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Summary

Legislation to prevent excessive spending by electoral candidates in the United Kingdom has been in place since 1883. The UK’s system of regulating campaign financing focuses on limiting the expenditure of political parties and individual candidates, rather than limits on donations that can be received by these parties and individuals, combined with a transparent reporting system of donations received and election expenditure incurred. Spending limits are imposed on parties, individual candidates, and third parties. Donations above a certain amount must be reported. Political parties receive a certain amount of broadcasting time on national television and radio free of charge.

Introduction

Legislation to prevent excessive spending by electoral candidates in the UK has been in place since the Corrupt and Illegal Practices Prevention Act 1883.[1] The current law regarding campaign financing in the UK is contained in the Representation of the People Act 1983;[2] the Political Parties, Elections and Referendums Act 2000;[3] and the Political Parties and Elections Act 2009.[4] The UK’s system of regulating campaign financing focuses on limiting the expenditure of political parties and individual candidates, rather than limiting the donations that can be received by these parties and individuals.

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II. Limits on Spending and Donations

A. Spending Limits

There are three types of distinguishable regulated expenditures during a general election:

  • “Campaign expenditure” incurred to promote a party or its policies in general (see Part II(A)(1))
  • “Election expenditure” incurred on promoting a specific candidate (see Part II(A)(2))
  • “Controlled expenditure” incurred by registered third parties to promote parties or candidates (see Part II(A)(3))
  • 1. Party Spending Limits

    The Political Parties, Elections and Referendums Act 2000 subjects political parties to campaign spending limits (known as “campaign expenditure”) one year prior to a general election.[5] The definition of campaign expenditure for political parties extends to “party political broadcasts, advertising, unsolicited material to electors, manifesto or other policy documents, market research and canvassing, media/publicity, transport, rallies or other events.”[6] The law requires that any notional expenditure (incurred when another person pays the cost that the political party would have otherwise had to pay) be counted as a campaign expenditure incurred by the party.[7]

    The limit on campaign expenditures by a party in a parliamentary general election is either a set amount in each part of the UK (£810,000 (about US$1.16 million) in England, £120,000 (about US$172,000) in Scotland, £60,000 (about US$86,000) in Wales), or £30,000 (about US$43,000) multiplied by the number of constituencies (seats) contested by the party in that part of the UK, whichever is greater.[8] In Northern Ireland the limit is simply £30,000 multiplied by the number of constituencies contested by the party.[9] Different limits apply to elections for the European Parliament, the Scottish Parliament, the National Assembly for Wales, and the Northern Ireland Assembly, and when elections overlap.[10]

    In the 2015 general election the campaign expenditures were £15.58 million (approximately US$22 million) for the Conservative Party, £12 million (about US$17 million) for the Labour Party, and £3.5 million (about US$5 million) for the Liberal Democrats.[11]303">11

    2. Candidate Spending Limits

    Spending by individual candidates on their election expenses is generally excluded from the definition of campaign expenditure in the Political Parties, Elections and Referendums Act 2000[12] and is regulated instead through the Representation of People Act 1983, as amended bythe Political Parties, Elections and Referendums Act 2000 and the Political Parties and Elections Act 2009.

    Under those statutes, candidates for elections have spending limits that they cannot exceed (known as “election expenditure”), and they may not incur personal election expenses of more than £600 (about US$850).[13] These limits are set through secondary legislation by the Secretary of State and may be changed only when the Secretary of State “considers that the variation is expedient in consequence of changes in the value of money” or upon the recommendation of the Electoral Commission.[14]

    Prior to 2009, the law allowed electoral candidates to spend large amounts in the period prior to becoming a candidate. The Political Parties and Elections Act 2009 amended the law to provide for a “pre-candidacy”  period and short campaign period during which spending would be controlled. Under the provisions of this Act the pre-candidacy period, also known as the “long campaign” period, begins fifty-five months from the day Parliament first met.[15] The “short campaign” period begins when an individual officially becomes a candidate. The earliest date that a person can officially become a candidate is the day that Parliament is dissolved, which generally occurs twenty-five working days before polling day.[16] In 2015, for example, Parliament was dissolved on March 30, 2015, and polling day was May 7, 2015.[17]

    The spending limits vary for the “long campaign” and “short campaign.” In the 2015 election, the long campaign began on December 19, 2014, and ran until March 30, 2015, when the short campaign commenced and more stringent spending restrictions came into force.[18] For the long campaign period of the 2015 general election, the limits on candidate spending were £30,700 (approximately US$43,700) plus 9 pence (p) per voter in rural constituencies and 6p per voter in borough seats.[19] During the short campaign period, these limits were drastically reduced to £8,700 (approximately US$12,380) plus 9p per voter in the rural constituencies and 6p per voter in borough seats.[20]

    For the 2015 general election, candidates collectively spent approximately £14 million (approximately US$19.9 million).[21]

    3. Third-Party Spending Limits

    Individuals or groups that do not stand in an election but aim to promote or disparage electoral candidates are also subject to controls and restrictions on the campaigning that they can do. They may incur expenditure (referred to as “controlled expenditure”[22] by holding public meetings or organizing public displays, or by issuing advertisements, circulars, or publications. They can spend up to £500 (approximately US$700) in a general election to promote or disparage a particular candidate’s electoral prospects if they do so independently and without the candidate’s prior knowledge.[23]

    Third parties (also referred to as “non-party campaigners”[24] may register with the Electoral Commission to be “recognised third parties.” Recognized third parties may make controlled expenditures promoting one party or opposing another in general parliamentary elections totaling £319,800 (about US$456,000) in England, £55,400 (about US$79,000) in Scotland, £44,000 (about US$63,000) in Wales, and £30,800 (about US$44,000) in Northern Ireland in the 365 days before the election.[25] For third parties who have not registered, the limit of expenditure permitted is £20,000 (about US$28,000) in England and £10,000 (about US$14,000) in Scotland, Wales, and Northern Ireland.[26] There is also a maximum campaign limit of £9,750 (about US$14,000) per constituency, and any third party that incurs expenditure greater than that amount commits an offense.[27] Recognized third parties must complete a return that specifies all controlled expenditure that was incurred during the relevant period.[28]

    For the 2015 general election, around £3 million (approximately US$4.27) was spent by registered third parties.[29]

    B. Limits on Donations

    1. Limits on Donations to Parties

    There are no limits on the amount of donations that political parties may receive; however, there are laws that govern who may be a donor, as well as limits, noted above, on spending by political parties on campaign expenditure. The aim of the law is to regulate donations to political parties through transparency, as political parties must make their finances public.[30]

    Political parties may accept donations above £200 (about US$280) only from “permissible donors.”[31] Donations are defined in the Political Parties, Elections and Referendums Act 2000 to include “gifts of money and property; subscriptions and affiliation fees; sponsorship; money spent on behalf of a party; the provision of property, services, or facilities; or the lending of money other than at commercial rates.”[32] A “permissible donor” is defined to include an individual registered on a UK electoral register, a UK-registered political party, a UK-registered company, a UK-registered trade union, a UK-registered building society, a UK-registered limited liability partnership, or a UK-based unincorporated association.[33] Additionally, only individuals who are resident, ordinarily resident, and domiciled in the UK for the purposes of income tax may make donations of over £7,500 (about US$10,700).[34]

    Until the Electoral Administration Act 2006,[35] donors to political parties were legally obliged to report their donations to the Electoral Commission by January 31 of the year after the donation was made if they donated more than £7,500.[36] The Electoral Administration Act 2006 repealed the applicable section of the Political Parties, Elections and Referendums Act 2000 because “in practice this provision has been of little use.”[37] In addition, under the Political Parties and Elections Act 2009, donors that provide over £7,500 to a political party must make a written declaration to the Party, including their full name and address, and an acknowledgement that they are resident, ordinarily resident, and domiciled in the UK for income tax purposes; that they are the person providing the donation; and that they have not received a benefit from anyone in return for making the donation.[38] This requirement is aimed at ensuring that the person donating the money is the true donor, and not acting on anyone’s behalf.[39] It is an offense for the personto knowingly provide false information on the declaration, as well as for the party to receive such a donation without a declaration.[40]

    Foreign donors, other than registered British electors living abroad, are not considered to be permissible donors. If a donation is received from a donor that does not fall into  these categories, the political party must return the donation or, if the donor cannot be identified, return the money to the Electoral Commission.[41] If the Electoral Commission believes that a political party has received a donation from a nonpermissible source, they may seek a forfeiture order in court for the value of the donation.[42]

    Donations over £7,500 to the main political party offices, or over £1,500 (about US$2,100) to constituency or local party offices, must be reported to the Electoral Commission. These reports must be made on a quarterly basis, and every week during a general election campaign.[43] Loans must be reported in the same way as donations.[44]

    2. Limits on Donations to Candidates

    There are no limits on the donations that electoral candidates may receive during the regulated period before an election, other than that, similar to political parties, donations over £50 (about US$70) must come from permissible donors, who are UK-based sources.[45] Members of registered political parties or holders of elected offices are known as “regulated donees,” and donations that they may accept outside the regulated period are also regulated. These individuals may accept donations or loans over the amount of £500 (about US$700) only from permissible donors.[46] Donations or loans larger than £1500  from one source must be reported to the Electoral Commission.[47]

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    III. Allocation of Free Broadcasting Time

    Political parties receive a certain amount of broadcasting time on national television and radio free of charge.[48] The formula  for the allocation, length, and frequency of party political broadcasts is determined by the independent communications regulator Ofcom (Office of Communications) for commercial broadcasters with public service obligations.[49] Ofcom’s rules provide that major parties can receive at least two free broadcasts, the length of which are determined by Ofcom, taking into account “the circumstances of a particular election, the nation in which it is held, and the individual party’s past electoral support and/or current support in that nation.”[50] The British Broadcasting Corporation is not regulated in this respect by Ofcom, but its charter agreement contains a provision that it will carry party political broadcasts.[51]

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    Prepared by Clare Feikert-Ahalt
    Senior Foreign Law Specialist
    March 2016


    [1] Corrupt and Illegal Practices Prevention Act 1883, 46 & 47 Vict. c. 51.

    [2] Representation of the People Act 1983, c. 2, http://www.legislation.gov.uk/ukpga/1983/2, archived at https://perma.cc/PZW4-R7WT.

    [3] Political Parties, Elections and Referendums Act 2000, c. 41, http://www.legislation.gov.uk/ukpga/2000/41, archived at https://perma.cc/CL4C-FEY8.

    [4] Political Parties and Elections Act 2009, c. 12, http://www.legislation.gov.uk/ukpga/2009/12, archived at https://perma.cc/E4HK-BRP8.

    [5] ELECTORAL COMMISSION, UK PARLIAMENTARY GENERAL ELECTION 2015, GUIDANCE FOR CANDIDATES AND AGENTS, PART 3 OF 6 – SPENDING AND DONATIONS 14, http://www.electoralcommission.org.uk/__data/assets/pdf_file/0004/173074/UKPGE-Part-3-Spending-and-donations.pdf (last visited Mar. 4, 2016), archived at https://perma. cc/4287-NULU; Political Parties, Elections and Referendums Act 2000, c. 41, § 72 & sched. 9.

    [6] Political Parties, Elections and Referendums Act 2000, c. 41, sched. 8.

    [7] Id. § 73.

    [8] Id. sched. 9, § 3(2) & (3). For example, if the party in question contested only one constituency in Wales, its limit would be £60,000, while if the party contested three constituencies in Wales, its limit would be £30,000 multiplied by three, or £90,000.

    [9] Id. sched. 9, § 3(4).

    [10] Id., sched. 9, §§ 4–11.

    [11] Matt Cardy, General Election 2015 Explained: Who Finances The Parties, Who Gets The Most – And How Much Does The Campaign Cost?, INDEPENDENT (London) (Apr. 17, 2015), http://www.independent.co.uk/news/uk/politics/generalelection/general-election-2015-explained-who-finances-the-parties-who-gets-the-most-and-how-much-does-the-10186008.html, archived at https://perma.cc/8J9Z-KU6Y.

    [12] Political Parties, Elections and Referendums Act 2000, c. 41, § 72(7).

    [13] The limits are currently set by Order under the Representation of the People Act 1983, c. 2, §§ 76–76A.

    [14] Representation of the People Act 1983, c. 2, § 76A. See, e.g., Representation of the People (Variation of Limits of Candidates’ Election Expenses) Order 2005, S.I. 2005/269, http://www.legislation.gov.uk/uksi/2005/269/made, archived at https://perma.cc/7J33-PBXS.

    [15] Representation of the People Act 1983, c. 2, § 76ZA.

    [16] ELECTORAL COMMISSION, supra note 5, at 6.

    [17] THE ELECTORAL COMMISSION, RETURN OF CANDIDATE SPENDING: UK PARLIAMENTARY GENERAL ELECTION(SHORT CAMPAIGN) GB, http://www.electoralcommission.org.uk/__data/assets/pdf_file/0006/181896/Explanatory-notes-return-candidate-spending-donations-Short-UKPGE-GB.pdf (last visited Mar. 2, 2016), archived at https://perma.cc/XHT5-4ZX5.

    [18] 2015 Election Campaign Officially Begins on Friday, BBC NEWS (Dec. 18, 2014), http://www.bbc.com/news/uk- politics-30477250, archived at https://perma.cc/JR96-2RYC.

    [19] Representation of the People Act 1983, c. 2, § 76ZA (amended by Representation of the People (Variation of Limits of Candidates’ Election Expenses) Order 2014, SI 2014/1870, http://www.legislation.gov.uk/uksi/2014/1870/ introduction/made, archived at https://perma.cc/5EGM-UWNW).

    [20] Id.

    [21] Cardy, supra note 11.

    [22] “Controlled expenditure” is defined in section 85 of the Political Parties Elections and Referendums Act 2000 as “expenses incurred by or on behalf of the third party in connection with the production or publication of election material which is made available to the public at large or any section of the public (in whatever form and by whatever means).”

    [23] Political Parties, Elections and Referendums Act 2000, c. 41, pt. VI.

    [24] Non-Party Campaigners, ELECTORAL COMMISSION, http://www.electoralcommission.org.uk/i-am-a/party-or- campaigner/non-party-campaigners (last visited Mar. 8, 2016), archived at https://perma.cc/Z7V6-2PBY.

    [25] ELECTORAL COMMISSION, UK PARLIAMENTARY GENERAL ELECTION 2015: CAMPAIGN SPENDING REPORT ¶¶ 2.18, 2.19 (Feb. 2016), http://www.electoralcommission.org.uk/__data/assets/pdf_file/0006/197907/UKPGE-Spending-Report-2015.pdf, archived at https://perma.cc/83VH-6YXV. Only individual residents in the UK, registered UK overseas electors, a registered party, or a permissible donor within the Political Parties Elections and Referendums Act 2000 may give notification to the Electoral Committee and become a recognized third party. Political Parties, Elections and Referendums Act 2000, c. 41, §§ 88–95.

    [26] Political Parties, Elections and Referendums Act 2000, c. 41, § 94.

    [27] Id.

    [28] Id. §§ 96–100.

    [29] Cardy, supra note 11.

    [30] Political Parties, Elections and Referendums Act 2000, c. 41, §§ 80–84.

    [31] Id. § 54.

    [32] Id. § 50.

    [33] Id.§ 54.

    [34] Id. § 52(2ZA).

    [35] Electoral Administration Act 2006, c. 22, http://www.legislation.gov.uk/ukpga/2006/22/contents, archived at https://perma.cc/D6L2-QUZD.

    [36] Political Parties, Elections and Referendums Act 2000, c. 41, § 68.

    [37] Electoral Administration Act 2006, c. 22, Explanatory Notes, § 57, ¶ 303.

    [38] Political Parties, Elections and Referendums Act 2000, c. 41, § 54A, as amended by the Political Parties and Elections Act 2009, c. 12.

    [39] Political Parties and Elections Act 2009, c. 12, Explanatory Notes, § 9, ¶ 34.

    [40] Political Parties, Elections and Referendums Act 2000, c. 41, § 54A, as amended by the Political Parties and Elections Act 2009, c. 12.

    [41] Id. §§ 56–57.

    [42] Id. § 58.

    [43] Id. §§ 62–63. The form for reporting donations is available on the Electoral Commission’s website, at http://www.electoralcommission.org.uk/d__ata/assets/electoral_commission_pdf_file/0016/13507/form-rd1a-rd.pdf, archived at https://perma.cc/8Q2Y-VHCQ.

    [44] Political Parties, Elections and Referendums Act 2000, c. 41, pt. 4A, as amended by the Electoral Administration Act 2006, c. 22.

    [45] Representation of the People Act 1983, c. 2, sched. 2A.

    [46] Political Parties, Elections and Referendums Act 2000, c. 41, sched. 7.

    [47] Id.

    [48] Communications Act 2003, c. 21, § 333, http://www.legislation.gov.uk/ukpga/2003/21, archived at https://perma.cc/4HGY-TGU7.

    [49] Id. The current rules are available at Ofcom Rules on Party Political and Referendum Broadcasts, OFCOM (Mar. 21, 2013), http://stakeholders.ofcom.org.uk/broadcasting/guidance/programme-guidance/ppbrules, archived at https://perma.cc/9NP4-VKSJ. Guidance to assist broadcasters on how Ofcom usually interprets and applies the Broadcasting Code and its rules is found in Ofcom Guidance Notes, Section 6: Elections and Referendums, OFCOM (Mar. 21, 2013), http://stakeholders.ofcom.org.uk/binaries/broadcast/guidance/831193/section6.pdf, archived at https://perma.cc/893R-22KD.

    [50] Ofcom Rules on Party Political and Referendum Broadcasts, supra note 49, ¶ 13.

    [51] DEPARTMENT FOR CULTURE, MEDIA AND SPORT, BROADCASTING: AN AGREEMENT BETWEEN HER MAJESTY’S SECRETARY OF STATE FOR CULTURE, MEDIA AND SPORT AND THE BRITISH BROADCASTING CORPORATION, 2005–6, Cm. 6872, at 23, http://downloads.bbc.co.uk/bbctrust/assets/files/pdf/about/how_we_govern/agreement.pdf, archived at https://perma.cc/EX7W-QXBR.

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    Last Updated: 05/17/2016