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Explained: Why Britain’s ‘struggling’ campaign finance laws are being reviewed amid anger at the Electoral Commission

There have long been calls to update the UK's electoral law (PA)

5 min read

The UK’s much-maligned electoral laws are due for a shake-up after calls for them to be brought into the digital age.

A review is being set up the Committee on Standards in Public Life (CSPL) which will look into campaign expenditure, regulation and enforcement by the Electoral Commission, police and prosecutors.

What is being reviewed?

The inquiry will have three aspects; to look at whether the Electoral Commission has the powers it needs to be a robust regulator of election finance in the 21st century.

It will assess both the civil sanctions and criminal prosecution regime and whether they work to deter and sanction breaches of election finance laws.

And it will examine the different regimes for party and candidate finance laws and consider if they should be put into a single framework.

What is not being investigated?

The CSPL say matters relating to the arrangements for funding political parties will not be looked into, as this review is about the regulation of election finance.

But the committee will look at foreign donations in elections through the mechanism of funding adverts on digital and social media platforms.

And they will not be looking into the “fairness” of the Brexit vote, saying they do “not consider individual cases and will not be looking at previous referendums or elections”.

Why now?

The CSPL last substantively reviewed the Electoral Commission in 2007, and says since then “digital campaigning has transformed the way in which parties and campaigners engage with voters, creating challenges for the regulation of election and referendum campaigns”.

It added: “With the Electoral Commission approaching its twentieth anniversary, the CSPL believes the time is right to return its focus to the regulator.”

How will it work?

There is a public consultation open for submissions until 5 pm on 31 July, and the CSPL will hold a series of meetings with political parties, campaign groups, Parliamentary bodies, law enforcement, academics and think tanks.

When will it report back?

The review is expected to run for approximately 12 months, and the report will be presented to the Prime Minister and published on the committee’s website in June next year.

Why is it needed?

There is a widespread belief that the Electoral Commission has been trying to enforce analogue regulations in the digital age, stretching back to the furore around the 2015 General Election and the use of battle buses and controversy over the difference between what parties log as national and local spending.

The Electoral Reform Society have repeatedly taken aim at what it sees as major loopholes in the legislation, such as a lack of real-time donation reporting and the fact parties are not required to break down their social media spend.

The campaign group says there is a “near-total lack of regulation of online political advertising”, and no single national database of online ads.

The Electoral Commission has also come under fire for a long-running investigation into whether the Leave side broke the spending rules in the EU referendum, which saw some fines levied but only eventually ended almost four years since the vote after the Met Police chose to close their inquiry into the Vote Leave group and campaigner Darren Grimes last month.

Conservative MP Peter Bone, a long-time critic of the body, brought up the matter at PMQs on 13 May, saying the "arrogant, incompetent and vindictive Electoral Commission suffered its final humiliation” and asked Boris Johnson to “ensure that politically corrupt, totally biased and morally bankrupt quango is abolished”.

What are the potential outcomes?

Mr Bone could get his wish, and the CSPL could decide the best way forward is to dismantle the body as it is known now and start again, with an updated set of regulations which cover digital campaigning, underpinned by new primary legislation.

What is for sure though is the loopholes around how spending is tallied up across parties, campaign groups and individuals will be tightened, and the system of civil and criminal sanctions will be toughened to act as a more of a deterrent to rule breakers.

What the body which oversees this will actually look like, though, remains to be seen.

What are the key players saying?

Announcing the review, CSPL chair Lord Evans said: “Our review will look at what the regulation of election finance should achieve and how it is regulated. 

“That will involve examining the Electoral Commission’s role as a regulator of election finance, along with the work of the police and CPS in this area. 

“We intend to look at electoral regulation from first principles – what really matters in this area? What values and principles should guide regulation of finance during elections?”

A spokesperson for the Electoral Commission said: “The review launched by the Committee on Standards in Public Life is a welcome look at the regulatory framework on election finance, enforced by the Commission, the police and the courts. 

"This framework ensures the integrity and transparency of democracy and political finance are maintained in the UK, and underpins public confidence in our democratic process.

“Since the current regulatory regime was established in 2000, the nature of campaigning at elections and referendums has changed; the use of digital campaigning techniques is significant and electoral laws are struggling to keep pace. 

“This makes CSPL’s work even more timely and valuable. We look forward to engaging with the Committee on this review, and to discussing how the framework can be updated to strengthen financial regulation and deliver greater voter confidence.”

And Darren Hughes, chief executive of the Electoral Reform Society, told PoliticsHome: “It’s clear there are major gaps in our electoral law that are putting democracy at risk. 

“Loopholes in Britain’s analogue-age campaign rules mean that donors based in foreign tax havens, or operating through untraceable shell companies can pump in money to influence our political parties. 

“Others allow for unscrupulous individuals to pay for anonymous ‘dark’ ads on line, or pump out disinformation during election periods to sway the result. We need to bring our electoral law into the digital age – and put voters first. 

“The committee is right to investigate this. As the chair notes, digital campaigning has ‘revolutionised the way parties and campaigners engage with voters’. But the legislation has remained 20 years out of date.”

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