Raising election spending limits in line with inflation

On 22 February 2021, Lord Rennard is due to ask Her Majesty’s Government “what representations they have received in support of their plans to increase the permitted expenditure limits for political parties at general elections; and what they plan the uprating in line with inflation for national spending limits to be”.

The question relates to a Government announcement on 3 December 2020 that it would increase the spending limits for candidates at the upcoming local council elections in England to reflect inflation. The Government argued it was right “to ensure a level playing field” in the spending of candidates and parties in local elections. However, it noted that the statutory spending limits that currently existed had, in many cases, not been changed since they were set 20 years previously.

The Government also stated that the changes to the May 2021 spending limits “makes no other substantive or real-terms change” to election spending, and that limits “remain consistent with the initial intent of spending limits”. In addition, it stated that in future this could be changed for other types of elections:

It is the Government’s intention to review party and candidate spending limits for all other polls (within the legislative competence of the UK Government) next year, with a view to uprating them in line with inflation since they were originally set. This will create a baseline for regular and consistent reviews of all limits in future. We will work with stakeholders, including the Electoral Commission and the Parliamentary Parties Panel, on this process.

What are party and candidate spending limits?

In the United Kingdom the regulation of party spending during an election is carried out by the Electoral Commission. The legislation underpinning this is complex and reflects the distinction between candidate and party spending during elections. A recent Supreme Court judgment provides the following overview:

Since the 19th century, legislation has imposed limits upon a candidate’s election expenses. The current statute is the Representation of the People Act 1983 (“RPA 1983”). Some of the rules and concepts in that act effectively date from Victorian times; others have been added by successive modern adjustments, and amendments have continued since 1983.

Until 2000 there were no rules about national expenditure by political parties. They were introduced by the Political Parties, Elections and Referendums Act 2000 (“PPERA 2000”). That act also made some amendments to RPA 1983.

The Electoral Commission, itself established by PPERA 2000, details the difference between party spending and candidate spending in guidance:

• Party campaign—spending on campaigning to promote the party and its policies generally. For example, national newspaper adverts for the party, or leaflets explaining party policy. It also includes spending on promoting candidates at elections where the party nominates a list of candidates for a region, instead of individual candidates for local areas.
• Candidate—spending on campaigning to promote a particular candidate or candidates in their local area. For example, leaflets or websites that focus on one or more candidates and their views.

Candidates are required to submit spending returns, showing spending during an election campaign, to local Returning Officers (RO). In major contests, such as general elections, copies of the candidate spending returns will be sent by ROs to the Electoral Commission. In the case of national party spending, political parties have to report spending to the Electoral Commission in a spending return.

How are the limits currently calculated?

Limits on spending vary according to the type of elections and the type of spending. For example, in the 2019 general election, guidance produced by the Electoral Commission

Using the example of the 2019 general election again, the Electoral Commission also produced guidance on spending limits that applied to national party campaign spending. There are two methods for calculating the spending limit during general election campaigns, with a party automatically receiving the method which provides a higher limit.

Broadly speaking a £30,000 limit for each constituency contested is used, although smaller parties that contest fewer seats might receive a different limit. In this case the limit uses a fixed sum for each part of Great Britain where seats are contested, rather than the number of seats contested. In Northern Ireland constituencies there is only the option of a limit of £30,000 per constituency contested.

In practice this means that during the 2019 general election, parties that contested every constituency were limited to party campaign spending of £19.5 million (£30,000 multiplied by 650).

Use of the current national spending limits

The Electoral Commission’s Political Finance Online Database provides information on the spending of each political party during election campaigns.

The Electoral Commission has not yet published complete spending data for the 2019 general election, due to the impacts of Covid-19. However, data from earlier general elections show that national party campaign spending limits have not been reached by any political party. In addition, they consistently demonstrate the Conservative party outspending other parties.

The Independent has calculated that uprating the spending limits for general elections to take account of inflation would raise the £19.5m national limit to around £33m.

Debate regarding caps on both national and candidate spending limits is often tied up with wider concerns regarding party finances. For example, Transparency International has argued a cap on donations and a lowering of national spending limits is one of the steps needed to “end the dominance of big money in UK politics”. Other commentators have argued that reform of electoral law is required for issues such as online political advertising or clarifying perceived ambiguities in authorising spending.

Read more

• Full Fact, Democratic Deficit? The Rules of Election Spending, 10 May 2017

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