Key facts
- The UK's Representation of the People Bill has been delayed, allowing the new prime minister to shape its legislation.
- The bill addresses political donations amid concerns over the influence of mega-donors, including cryptocurrency billionaire Christopher Harborne.
- Donations of £1 million or more now constitute over a third of private donations to UK parties, up from 1% in 2015.
- A 2023 increase in the election spending cap has incentivized parties to seek larger contributions from wealthy individuals.
- Proposed reforms include limits on donations from overseas citizens and checks on foreign actors, but some MPs want stricter caps.
The UK's Representation of the People Bill, which includes measures to reform political donations, has been delayed by the incoming prime minister, Andy Burnham. This pause allows his new administration to shape the legislation, particularly in light of ongoing scrutiny over large political contributions.
Concerns are mounting that mega-donations are corrupting the British political system, with the proportion of private donations from individuals or companies giving £1 million or more rising to over a third in 2024, from just 1% in 2015. Steve Goodrich, head of research at Transparency International, described this trend as an 'Americanisation of British politics, where money talks the loudest.'
This surge in big money is partly attributed to a 2023 decision by the Conservative government to increase the election spending cap by 80%, leading parties to seek larger sums from wealthy donors. The super-rich are increasingly funneling money towards parties promising tax cuts and deregulation, with a notable affinity between those who made fortunes from cryptocurrencies and tech, and right-wing politicians.
The Representation of the People Bill proposes an annual £100,000 limit on donations from British citizens living abroad and new checks on foreign actors using shell companies. However, some MPs believe these measures are too timid. Proposals for a permanent ban on cryptocurrency donations and significant reductions in campaign spending limits have been put forward. Goodrich highlighted that there is currently no limit on how much UK individuals or companies can donate to parties.
MPs Stella Creasy and Alex Sobel have proposed capping donations at £100,000 and £1 million, respectively. Creasy's proposed cap could have resulted in Reform UK losing an estimated 85% of its registered donations in 2025. However, significant reform faces political hurdles, as both the Conservative and Labour parties have historically benefited from large donations, creating a standoff on limiting contributions.