Evidence submitted by Peter Bradley
I am grateful for the opportunity to submit
to the Committee's inquiry the findings of research which I have
recently undertaken into the funding of local political campaigning
which, in my view, raise concerns which have been largely overlooked
in the recent controversy about the funding of national parties.
SUMMARY
My findings show how expenditure on local campaigning
prior to the regulated short campaign can decisively influence
election results in favour of the party with the greatest resources.
They illustrate how a targeted funding strategy
was a key if not the determining factor in the results in a large
number of marginal seats which changed hands at the 2005 general
election.
They also indicate how, especially when Government
majorities are small or a significant number of seats are marginal,
such strategies could decide the outcome of entire general elections.
My findings lead me to the conclusion that Parliament
should as a matter of urgency introduce controls to ensure that
the capacity to raise, target and spend funds locally does not
become the determining factor in election results.
I recommend the introduction of a limit on local
campaign expenditure throughout the electoral cycle as a means
of restoring something like a level playing field between the
parties in the most closely contested seats.
I also recommend in the interests of transparency
that the sources and amounts of funding received by each local
party throughout the electoral cycle be made public at the calling
of each election and that further donations should not be permissible
during the short campaign.
RESEARCH
As you will see from the table which I enclose,
I have surveyed a number of marginal seats where the contest between
the parties was at its most intense in the run-up to last May's
general election.
My sample is drawn from those 93 constituencies
in which, according to the Electoral Commission's records, the
local Conservative Association benefited from donations from a
consortium which comprised Lord Ashcroft's Bearwood Corporate
Services Ltd, Lord Leonard Steinberg and an organisation known
as the Midlands Industrial Council with which Mr Robert Edmiston
is associated.
The consortium had earlier made public its intention
to target funding on what it considered to be key battleground
seats. I have sought to establish whether its strategy proved
effective and, if so, what conclusions should be drawn from it.
The partners contributed over £1.3 million
to what I have identified as three categories of constituency:
— those Labour and Liberal Democrat
seats they aimed to win in 2005;
— those Labour and LD seats they
aim to win at the next election; and
— Conservative marginals they
were defending in 2005.
A small minority, including Kensington &
Chelsea and Witney, appear to be less strategic targets.
In some cases, the consortium's donations made
up a very significant proportion of the local Conservative Association's
external funding. In my former constituency of The Wrekin, for
example, the £55,742 which the Conservatives received from
Lord Steinberg and the Midlands Industrial Council constituted
the total amount of the donations it reported to the Electoral
Commission.
In other cases, the consortium's support represented
only part of a much larger total. In Welwyn & Hatfield, Bearwood's
donation of £15,000 in April 2005, though significant, was
only a fraction of the £180,382 which the Conservative Association
declared to the Electoral Commission for the period 2001-05.
I am not suggesting that other parties have
not sought electoral advantage by outspending their rivals. But
I am not aware that any party has set out to do so as strategically,
systematically and with such significant resources as the Conservatives
at the last election.
The consortium's clear premise was that in marginal
seats the party with the most money to spend on campaigning ought
to have a decisive advantage at elections and its strategy was
designed to ensure that they did.
The key issue, in my view, is whether the consortium
was right and, if so, whether it is desirable to allow one candidate's
ability to outspend another to determine election results.
FINDINGS
In his recently published book Dirty politics,
dirty times (pp 295-6), Lord Ashcroft concludes that, on analysing
last May's election results,
— "it soon became clear that we
had been wasting neither our time nor our resources. Of the 33
candidates who won seats from Labour or the LDs, no fewer than
25 had received support from the fund that I had set up with Leonard
Steinberg and the Midlands Industrial Group."
He went on to observe, with regard to the future,
that
— "...we made real progress in
other seats which I am hopeful will be winnable at the next election
in 2009 or 2010."
Lord Ashcroft's analysis is born out by my own.
As you will see from my table, I have adopted as my sample those
seats among the 93 supported by the consortium which were gained
by the Conservatives.
While by definition they will have benefited
from the consortium's donations, the source of their funding is
less important in this context than the overall quantum and, in
particular, the spending advantage it may have given them. I have
therefore taken into account the total value of donations available
to the competing parties and plotted the differential between
them. I have also assumed a close link between funds received
and funds spent.
My headline findings are as follows:
1. 24 of the 36 Conservative gains had been
targeted by the three donors, including 23 of 31 from Labour and
one of five from the Liberal Democrats.
[The Conservatives also lost three seats to
the Liberal Democrats, despite targeting two of them, Taunton
and Westmoreland & Lonsdale.]
2. The Conservatives outspent Labour (and
the Liberal Democrats in one seat) in 19 of the 24 targeted seats
it won.
3. The Conservatives exceeded the national
swing in 20 of those 24 gains.
4. The average swing in the targeted seats
the Conservatives won was 4.5% against a national average of 3.1%.
5. The Conservatives spent, overall, 2.4
times as much as Labour (and the Liberal Democrats in one seat)
in the 24 targeted seats it gained, but
— in three seats it outspent Labour
by over 10 times:
— Welwyn & Hatfield—swing
8.0%;
— Northampton South—swing 5.0%;
and
— in three seats it outspent Labour
by between five and 10 times:
— Lancaster & Wyre—swing
4.4%;
— Scarborough & Whitby—swing
5.1%; and
— Peterborough—swing 6.9%.
— in five seats it outspent Labour
by between two and five times:
— Rugby & Kenilworth—swing
4.1%;
— Wellingborough—swing 2.9%;
— Preseli Pembrokeshire—swing
4.8%; and
It is of course impossible to attribute to each
seat the precise reasons or balance of reasons for any given election
result. But these findings appear to confirm the causal relationship
not only between funding and electoral advantage but also between
wide differentials and high swings.
In closely fought marginal seats in which local
issues are increasingly significant, a candidate's capacity to
get his/her message across to the electorate is clearly of key
importance. The way in which much of the additional resources
were spent shows too that those with the most funding have a considerable
and, it appears, often a critical advantage over their rivals.
I set out below case studies which illustrate
how the Conservatives exploited their funding advantage in the
target seats.
— The Wrekin: the Conservative
candidate was able to outspend me by a factor of 11 to 1 and secured
a swing of 5.4%. That meant that on a regular basis over a protracted
period before the short campaign, he was able to take out paid
for advertorials in a series of weekly local papers with a wide
local readership.
Of perhaps greater significance, at a time when
I could afford to print just one constituency-wide newsletter
which my local party activists and volunteers struggled to hand-deliver
to as much of a large constituency as they could reach, my opponent
was able to produce campaign material on almost a weekly basis
which was frequently posted to every household in the constituency.
— Hammersmith & Fulham: the
Conservatives were able to outspend Labour by two to one and gained
a swing of 7.3%. They employed techniques similar to those employed
in The Wrekin and elsewhere.
It is also alleged that they employed individuals
to campaign on their behalf by, for example, displaying placards
at tube stations. In another London constituency, it is suggested
that the Conservatives employed a professional public relations
company to support their campaign.
— Gravesham: the Conservatives
could outspend Labour by a factor of 2.5 and achieved a swing
of 6.3%. Their candidate (now MP), Adam Holloway, told Channel
4 News (29 March 2005) that "without the Ashcroft money I
don't think I'd have done it." When asked "did Lord
Ashcroft's money help you win the seat?", he responded: "definitely,
I mean he gave me £25,000. That meant that every month in
the year before the election I was able to put out a leaflet to
every household."
CONCLUSIONS
As I have suggested, the issue is whether one
party's significant financial advantage over its principal rivals
is either fair or desirable. I believe that it is neither. While
campaigning inevitably costs money, access to funding must not
be allowed to become the decisive factor in the outcome of elections.
In my view, the source of funds, whether raised
locally or from third parties, is not the central issue. The channelling
by external donors of substantial funds to several targeted seats
poses a particular problem, not least in the influence they may
enjoy or be seen to enjoy with national parties or Governments.
But it is also unacceptable for one party to secure an electoral
advantage over another simply because it has wealthier local supporters.
The issue which my research has highlighted and which I believe
requires the most urgent attention is that of differential spending
by whatever means.
However, the growing importance of local spending
has other unwelcome consequences which should not be overlooked.
In many of the sample seats hard cash helped
to compensate for and mask the lack of local political organisation
or active support on which candidates and parties ought, in my
view, to rely if they are to be genuinely engaged with and accountable
to the communities they seek to represent.
New technologies are inevitably making political
campaigning less reliant on grass roots support and activism and
more remote from communities and voters. Unrestricted access to
funding should not be allowed to exacerbate or accelerate the
process.
Moreover, most voters would have been unaware
of either the extent or the source of the financial support which
their candidates had received and would not have had access to
a complete record until the Electoral Commission's data was updated
after the election. I believe that for many, that information
could have had an important bearing on how they ultimately decided
to vote.
RECOMMENDATIONS
Ideally, I would like to see limits on fundraising
and annual expenditure at both national and local levels. Capping
what can be spent, who can donate and on what terms should help
reduce the competition for advantage between the major parties
which has given rise to the problems which have recently attracted
so much attention.
However, in my view the key is not so much what
is donated but what is spent and for what purpose.
If a local benefactor or group of supporters
wish to donate to or raise funds for their party, it would, I
believe, be unreasonable to prevent them from doing so. But it
would not be unreasonable to stop them from converting their financial
strength into an undue electoral advantage by significantly outspending
other local parties.
The Electoral Commission has told me that it
has not as yet undertaken its own appraisal of the problems which
I have identified. But it has proposed, and the Electoral Administration
Bill makes provision for the introduction of spending limits on
campaigning in the four month period before a general election.
Such a form of regulation is clearly unworkable
in the absence of fixed electoral cycles. Even if it were enforceable,
it would prove ineffective. Parties would simply adapt their campaign
strategies and deploy their spending advantage earlier in the
cycle.
The answer, in my view, is to cap annual expenditure
on campaigning throughout the cycle. Local parties would be free
to raise funds in excess of the cap and either bank them or pass
them on to their national party. But they would not be able to
spend above the annual limit established for any given constituency
on any activity associated with party political campaigning.
It is also important in my view that electors
know how local parties are funded before they cast their votes.
I would propose that there should be a requirement at the calling
of each election that all local parties contesting it publish
in the local press all donations and their sources throughout
an electoral cycle and that no further donations should be permitted
during the short campaign.
It is important to emphasise that I am not proposing
that all parties, irrespective of the size of their membership
or their previous electoral performance, should benefit from similar
levels of funding. Limits should be set which parties which do
not enjoy significant local support may find challenging. They
should also be sufficiently high to allow for rather more campaigning
than most constituencies currently see in the course of a year
but low enough to ensure that a party's spending power cannot
serve as a substitute for the activism of its members and volunteers.
In seats in which one party enjoys a sizeable
electoral majority, its current advantage is unlikely to be significantly
affected by what I am proposing. But in marginal seats, the introduction
of spending limits, even if it does not provide for parity of
funding, should nevertheless prevent one party from securing an
unwarranted advantage by significantly outspending its competitors.
These controls would not of course restrict
the legitimate activities of elected representatives, including
their communications with constituents.
ACCESS TO
INFORMATION
Finally, I found in the course of my research
that of the 37 Conservative MPs who, according to the Electoral
Commission, received financial support from the three donors,
only 23 have made declarations in the Register of Members Interests.
There may be innocent explanations for these omissions but there
should not be such widespread discrepancies between the two records.
I understand that it is intended that in future
the Register will be better aligned with the Electoral Commission's
database. In the meantime, I hope that the Committee will make
its own inquiries as to why 14 beneficiaries of financial support
should consider it unnecessary to make a declaration on the Register,
whether the guidance to Members should be clarified and whether,
in the interests of transparency and accountability, they should
now be encouraged to amend their entries.
I would conclude that it cannot be right that
elections should be decided not by who wins the political argument
but by a handful of wealthy backers in a handful of marginal seats.
But that is a very real prospect not only in a considerable number
of marginal constituencies but potentially for the next election
as a whole unless steps are taken now to prevent it.
I hope that the above is helpful and would be
happy to provide oral evidence if required.
Peter Bradley
March 2006
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