The issue of who the Big 4 did fund before the election seems to have been of some (actually, considerable) interest since the figures for the Tories were posted here.
I’m grateful to commentator Infrequent Observer for updating the data to cover all the major political parties. As he or she put it:
Just to bring some balance to the story, below is a table detailing donations received by the Labour and Lib-Dem Partys from the same audit firms for the same period. It seems all parties benefit from ‘pro bono’ work to some extent. I am not saying I agree with it, just pointing out it isn’t just the Tories that accepted donations. I guess consideration also needs to be given to whether the support was offered by the audit firms (demonstrates leanings by firm toward one party over the other) or asked for by the parties (demonstrates more resources required by one party over the other). The answer to this may inform why the numbers are as they are.
Firm Labour Conservative Lib Dem Deloitte
£13,500.00
£323,501.75
£0.00
Ernst & Young
£0.00
£63,989.08
£0.00
Grant Thornton
£0.00
£15,000.00
£0.00
KPMG
£284,766.00
£435,973.00
£242,587.24
PWC
£184,193.00
£533,063.68
£78,710.00
Total
£468,459.00
£1,371,527.51
£321,297.24
I note what Infrequent Observer says.
But let me also be candid, I note considerable bias.
And that justifies my belief that:
a) Nothing these firms says is objective;
b) These firms have sought to use their influence to capture public revenue streams for their private benefit.
Don’t get me wrong: I’m not for a minute suggesting impropriety. But that was never needed. I’m simply saying their lobbying to a particular party achieved results from which they can very obviously gain, and that must have been a foreseeable, and anticipated outcome.
And I can say I find that distasteful. Because I do.
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What gets your ire more Richard; that these companies lobby the parties or that the parties accept these ‘donations’?
What would be interesting to chart is the date on which these ‘donations’ came in? I would postulate that whomever the party that was highest in opinion polls or whomever had just made a big increase in the polls would have benefited financially, everyone likes to back a winning horse.
To that end, if you went back to the 1997 donation figures I wouldn’t be surprised if you saw a similar bias towards New Labour. The companies no doubt saw which way the wind was blowing and wanted to get some favours owed to them early on.
fyi: not a conservative if anyone thinks of calling me a party tribalist.
“Don’t get me wrong: I’m not for a minute suggesting impropriety. But that was never needed. I’m simply saying their lobbying to a particular party achieved results from which they can very obviously gain, and that must have been a foreseeable, and anticipated outcome.”
Isn’t this just the same as the unions funding Labour, as a Labour vistory gives gains to the unions? I guess the unions are abit more overt about their political alliances though!
@Greg
Nor are unions asked to tell the government that there is no tax gap
I don’t think any of us are naive enough to think only one party or firm engages in lobbying. In January 1997, Bernie Ecclestone donated £1m to Labour. In November of that year the Government announced that F1 would be exempt from the tobacco ban. The ensuing media furore was huge.
The quantum is little different here and in the light of the decision with regards to the Audit Commission is, in my opinion, no less worthy of comment.
@ Richard, no but i’m sure there are plenty of statements made by the unions which are designed to further their own cause.
@Deeply Depressed
Blair was pretty sickening too
I agree
It’s why we still need to reform party funding
I don;t see the Tories dealing with it
I just see them union bashing
@Greg
Of course
But as I said – no one is buying their advice at the same time
Isn’t the sad truth of this simply that most people act in their own self-interest? Everyone tries to protect their own position, very few care for the good of the nation as a whole.
This is why Keynesianism never exists (I was going to say works, but the truth is, it has never been tred in the UK): because the right always wants reduced public spending and lower taxes (as they mainly pay the taxes) whereas the left always wants higher public spending and higher taxes (because they are disproportionately lower earners and employees/beneficiaries of the State).
But to my knowledge, there has never been a union that has proposed reducing public spending during a boom, or a right-wing think tank that has advocated increasing public spending in a recession.
So Richard, you say “nothing these firms say is objective”: isn’t the real truth that nothing anybody says is objective.
IMHO this is why we need state funding for political parties. Of course it will rankle with many people in the wake of the expenses scandal. And I must admit that the idea of putting my hand in my pocket to fund the Conservative party (or the Lib Dems based on their current activities) isn’t hugely appealing. But the alternative – where big business buys elections – is far worse.
Another reform that New Labour should have made, but didn’t… 😳
I presume these are non-cash donations? The amounts are therefore going to be dependent upon the resources the respective parties required and what the firms were prepared to offer.
There is obviously an element of self-interest, but Labour did have the machinery of government at its disposal whereas the Conservatives did not.
Party funding is an issue that needs to be resolved. State funding is not the answer in my opinion (for the same reason as it is not the answer to higher education funding) – it breaks the link between those receiving funds (political parties) and those giving the funds (the taxpayer). This would have serious implications on accountability and grassroots influence. It would also create a huge barrier to entry if it were to be combined with a ban on private funding.
Personally I think that there should be no donations from the state and private donations should be capped at £5k per year, per individual/ per organisation (including unions). That way political parties would need to connect with the public as a matter of survival and would likely have to reduce their army of spinners and bag carriers.
@Howard
Who decides how much each party gets? Is it based on results at the last general election? If so the governing party is always going to be at an advantage.
By the way Mad Foetus is bang on.
@Pat Good question. I’d give the three main parties equal amounts. On the smaller parties – not sure. Maybe proportionate to their opinion poll showing. I agree there is an issue about barriers to entry.
@NeilI’d argue that breaking the link between those receiving the funds and those giving the funds is PRECISELY what you want to do. Once you’ve done that, the only way an individual can influence the election result is with their vote – not their chequebook. One person, one vote – that’s what it’s about.
@Richard Murphy
Any figures for private equity houses and their principals?
Rather than fretting about the monkies let’s worry about the organ grinders!
@Howard
No one will be able to infleunce policy if donations are capped at a nominal amount per individual and organisation. Political parties would have to engage with the public to build their membership and raise funds to pay the bills. That means they would need to be more consultative and involve the grassroots in the political process.
The problems with state funding are twofold: once political parties realise such a source of funding, the amount of funding will inevitably increase substantially with no benefit to the taxpayer.
Second, political parties will no longer need the public or the grassroots. The Westminster elite will be able to dominate politics even more than they do now. It would be impossible for a grassroots movement to get of the ground because its access to state funding would be linked to representation in the Commons (zero).
@Neil
I often hear this form Tories
I wonder why?
@Richard Murphy
Hi Richard – what do you often hear? Do I presume that you would prefer state funding for political parties?
There are plenty of folk on this blog who think that the media has a fair influence. And i’m not sure how you can stop that without resorting to drastic measures.
@Neil
I hear union bashing
I would like a mix – state core funding and top up donations – to a strict limit
I have a few points:-
1. Parties distort democracy. How many times do ex-MPs complain that they had to vote under pressure from the whips rather than their own consciences? Of course, MPs owe a huge debt to the party to get elected,
but if there were no parties the electorate would have to be more knowledgable of their representatives.
2. State funding would address the issue of dubious donors but minority parties would get very little and we would remain a two party system. Also state funding didn’t work in Italy.
3. Donors expect a payback. It’s clear from the financial pages (and perfectly illustrated on Dragon’s Den) that most ‘business’ people wouldn’t part with their cash unless they were expecting a return plus interest. They didn’t get to where they are by being generous. So when a party is given a large donation you can be sure it comes with strings attached.
@Howard
So the Lib Dems with 21 % of the vote would get the same as Labour/Tories who poll 37/38%? What if a fourth party comes along – what % of the vote would they have to get to qualify for equal funding? 10,15,20%? How far would the Lib Dems have to slide down the polls to be ineligible for equal funding – 10,15%? They are at 12% in some polls at the moment.
1) ‘or asked for by the parties (demonstrates more resources required by one party over the other)’
To me, this more suggests what the parties are offering.
2) With comments about union funding etc, and everyone pursuing own interests, the comparative has to be kept in mind of the scale of these big 4 – there is little to compare, globally, with their power.
@Pat
Well, the leader debates were conducted on the basis of each party leader having equal screen time, so I was taking that as a starting point for the funding mix really. But obviously there would have to be a huge debate before the details of state funding could be worked out.
I think Richard’s point on Neil’s contribution is that the Tories usually want a really low organisational donation limit to screw the unions. But in fact I’d argue that the limit should be £5,000 per union member rather than per union, if we had that system.
Why do you think this amounts to lobbying? What actually happens is that the accounting firms show their public spirited nature by seconding a few managers or senior managers to the main opposition party in order to help them evaluate policy options. This makes a lot of sense for the opposition parties because the typical party worker doesn’t have a clue about tax legislation but the party in power can use the resources at the Treasury to field any questions on tax policy.
The notional value of the donation seems quite high because for the purposes of transparency it is valued at the staff member’s normal charge out rate which might be £250-300 per hour. There is no lobbying and the sort of 27 year old secondee who would be working for the party will be far too junior to have any political clout.
Clearly there are mutual benefits, but the benefits to the Big 4 firms are essentially no different from other forms of pro bono work. Andersen were “rehabilitated” after their work for the Labour Party and they benefitted from government contracts after being barred by the Conservatives following the DeLorean affair, but there are no special favours, merely good corporate citizenship.