Why Clegg needs to kick the donor habit

Despite the Observer’s best efforts, it is hard to see what the Lib Dems have actually done wrong here. Indeed, given how high minded the “serious” press are being about smears at the moment, it is surprising to see an article so riddled with innuendo. So let’s clear a few points up.

Firstly, there is no issue here of a donor buying policy; quite the opposite. There is an argument that the party should not accept further donations from Sudhir Choudhrie unless he is cleared of any wrong doing, but that is another matter.

Secondly £95,000 is not, in party funding terms, that much money. Rajeev Syal and Oliver Laughland implicitly acknowledge this by trying to attract your attention with the much bigger £475,000 figure donated by “relatives’ companies” but we aren’t talking about his wife here but companies his son and nephew run. The former, Alpha Healthcare, has been donating to the party far longer (and is the subject of some other news reports). There is no suggestion that this money has in any way come from Sudhir Choudhrie himself. And if you’re going to bring nephews into it, where do you stop? Third cousins?

But there is a lesson here for Clegg that he would do well to heed. Politics and money are a toxic mix. Even when nobody can be said to have done anything wrong, too often it leads to the wrong sort of headlines. And one thing the Lib Dems can’t afford to be seen as, as they creep up the polls (and I have to admit I’m relatively optimistic about how we might do in the next general election), is just another part of the shameless political class.

Clegg has done himself a lot of good in coming out for stringent reform of MPs’ expenses (it happens that I disgree with him on some of the detail, but it is far reaching nonetheless). He has also made great play out of demanding a cap on donations of £25,000 (half the Tories half-hearted call for £50,000 which they failed to follow up with actual votes when the Political Parties and Elections Bill went through the Commons earlier this year). With the economic climate and public mood such as it is, I think now is the perfect time for him to go one step further. He should impose a cap on the party, regardless of what the law says, and call on the other parties to do the same.

At what point that cap should be should be considered. In an ideal world, he might consider self-imposing his own £25,000-per-year cap, but given the other parties are unlikely to play ball, at least in the short term, that might be going a little too far. But what about £25,000-per-quarter? It would be simpler to administer than an annual cap and would go some way to matching the rhetoric with action while not leaving the party at a massive competitive disadvantage.

And how would it affect the party in real terms? Well, for the most part, even our large donations are in the tens of thousands rather than the hundreds of thousands (and even millions). In 2008, only two companies donated more than £100,000 – the Joseph Rowntree Reform Trust Ltd. and Marcus Evans Ltd. (a non-cash donation). So in reality we would lose very little.

What we would gain is some degree of immunisation from this sort of story – and complete immunisation from things like the Michael Brown scandal. We would also be seen to be practicing what we preach – something we aren’t seen to be doing nearly often enough. In the longer term, I suspect that will be worth far more than a couple of hundred thousand pounds.


  1. I like the idea in principle but we would risk trying to fight with one hand tied behind our collective back if we did this ourselves while the other parties – already better funded than us – continue to get big donations. “A couple of hundred thousand pounds” is not an insignificant sum to the party – in a way that it might be to the Tories or Labour – and would pay for a lot of campaigning if directed that way.

    Would the press really give our position enough coverage that the man in the street would even know it was a position we’d taken? Would it stop them trying to dig dirt on high end donors? I’d suggest not…

  2. Reform in general, and in this area especially, is constantly frustrated by people who are prepared to do the right thing for fear of putting themselves at comparative disadvantage. I simply think that if we are serious about being seen to challenge the establishment, as opposed to being the establishment, we have to conduct ourselves differently. Are we serious about a new politics of trust or not?

  3. First kudos on actually tackling the subject. I think we are both of the same mind that something should be done about this.

    I have to say to be brutally honest while I like the idea in principle of a cap I dont want to see the party handicapped. I take your point about being the pioneers and being brave but I still prefer a system of vetting donors I am afraid in acknowledgement something must be done but we cant run at a handicap.

    We, rightly, panel candidates because we recognise that a bad candidate is bad for the parties image but I think that a bad donor is just the same. Because we panel candidates (and we do have an anything to declare section to that) I dont see why vetting of donors cannot be applied.

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