Key facts
- Reform announced receiving £72 million in donations from cryptocurrency billionaires Ben Delo and Christopher Harborne.
- The UK government plans to amend legislation to impose tougher residency requirements on political donors.
- Donors may need to prove ongoing physical presence in the UK, with a minimum residency requirement of the remainder of the calendar year of return plus a full year.
- Nigel Farage acknowledged Reform could fall foul of government moves to clamp down on foreign donors.
- Trade unions condemned attempts to compare wealthy individual donors with union members' contributions.
- The government is considering spending limits for political parties.
The UK government is preparing to introduce amendments to legislation in the House of Lords that could invalidate Reform's recent £72 million in donations. The proposed changes aim to strengthen residency requirements for political donors, a move likely to be contested by Reform and its leader, Nigel Farage.
Reform announced that two cryptocurrency billionaires, Ben Delo and Christopher Harborne, who have previously lived overseas, each donated £36 million to the party. Senior Labour figures and unions had urged the government to review party funding rules in light of these substantial contributions.
Government sources indicated that the plans to tighten residency rules, which would require donors to prove an ongoing physical presence in the UK, have been in development for weeks. These measures are intended to align with existing government policies on residency for other areas, such as tax status.
Nigel Farage acknowledged that Reform might face challenges with the new rules, though the party maintains its donations are compliant with current legislation and previously approved parliamentary measures. Current rules restrict donations from expatriates to £100,000, with a 12-month waiting period after their return to the UK, backdated to March 25 of this year.
Ministers are considering an amendment that would extend this residency requirement to the remainder of the calendar year of return, plus an additional full year. This could delay Reform's ability to accept the £72 million until January 2028. Delo, who had been based in Hong Kong, stated in April his intention to return to the UK, while Harborne, previously in Thailand, is believed to have registered to vote in Hampshire in June.
Farage asserted that the donations are "100% compliant with the law today." Lady Taylor, a Labour minister in the Lords, confirmed to peers that the government was examining ways to strengthen residency requirements, including ensuring alignment with broader government policy on the length of time spent in the UK.
Angela Rayner, a Labour figure, criticized Reform's comparison of the billionaire donations to trade union members' contributions, calling the former an attempt by "offshore billionaires" to influence democracy. Trade unions are expected to issue a statement condemning such comparisons and urging further government action on political donations. Paul Nowak, head of Britain's union movement, called for action to prevent the wealthy from "corrupting our politics."
While some unions, like Unite, have backed limits on individual domestic donations, others, such as GMB, fear such measures could be used by future right-wing governments to curb union donations. Government sources indicated that calls to apply changes to unions were not under active consideration, but spending limits for parties are being reviewed.
Philip Rycroft, who previously reported on tightening electoral law for overseas donations, stated that the Reform donations raise broader questions about donation and spending caps, suggesting a need for a thorough review of the current system. MPs and peers are working on amendments to the bill to introduce donation caps and prevent spending limit increases without Electoral Commission approval.