The Cost of Democracy

Party funding has given rise to great controversy since 1997, and continues to do so. In recent years, row has followed row - from million-pound donations, to the so-called 'loans for peerages' affair. The question was the subject of an official investigation by Sir Hayden Phillips, whose blueprint for reform was produced in March 2007. This book charts the evolution of the party funding problem in recent years and explores the weaknesses of the Political Parties, Elections and Referendums Act 2000, which was enacted in a vain attempt to clean up British politics.

The book sets out a number of core principles which should inform the development of public policy in this field, and examines the different strategies for the implementation of these principles. Having regard to the experience of othercountries, including Canada, Germany and Sweden, a radical framework ofreform is proposed, designed to address the emerging crisis of party government with serious implications for democracy itself. The main concern is with the development of bold reform initiatives to encourage political parties to recruit and retain members, and give members rights in relation to the government and administration of these parties.

This thoughtful yet hard-hitting account by one of the leading scholars in the field will be of interest to constitutional lawyers and political scientists, as well as journalists and those with an interest in the way we are governed.

Preface
1 A Drama Unfolds
Introduction
The Conservative Funding Legacy
The 'Arms Race'
The Labour Party's Response
Questions for the Labour Party
The Ecclestone Affair
The Neill Committee
Conclusion
2 Regulatory Objectives
The Prevention of Corruption and Conflicts of Interest
Equality of Opportunity and Fair Competition for Political Office
A Need to Ensure that Political Parties are Adequately Funded
Promoting Citizen Participation in the Funding of Political Parties
Respect for the Nature and Diversity of Party Structure
The Protection of Human Rights
Conclusion
3 Regulatory Methods
Introduction
Transparency and Disclosure
Contribution Controls
Spending Controls
State Aid and Public Funding
Self-Regulation or State Regulation?
Supervision and Enforcement
Conclusion
4 Party Autonomy and Public Accountability
Introduction
Diversity of Party Structure
The Principle of Party Autonomy
Autonomy of Party Organisation: The Role of Legislation
Autonomy and Legality
From Autonomy to Accountability: Registration and Party Identity
State Supervision: Registration and Financial Accountability
Conclusion
5 Donations to Political Parties: The Regulatory Framework
Introduction
Disclosure and Corruption
Who May Donate to Political Parties?
The Mechanics of Reporting and Disclosure
Who Does Donate to Political Parties?
The Problem of Avoidance
Loopholes in the Regulatory Framework
Conclusion
6 From 'Sleaze' to 'High-Value Donors' to Loans
Introduction
'Sleaze': The Continuing Problem of Political Donations
The Labour Party's Response
'High-Value Donors': The Labour Party
'High-Value Donors': The Conservative Party
The Loans Affair: A New Problem Erupts
Implications and Consequences of the Loans Affair
Conclusion
7 Spending Limits in Election Campaigns
Regulatory Challenges
The Victorian Legacy: Candidate Limits
The Problem of Third Parties
Spending Limits on Political Parties
Calculating and Enforcing the Limit
Spending Limits and Third Parties
Spending Limits in Practice - The First Cycle
The General Election 2005
Conclusion
8 The Role of the State: Supporting Candidates and Political Parties
Introduction
Regulatory Challenges
Responsibility of the State
Meeting the State's Responsibility
Party Political Broadcasts: Transferring the State's Obligations
New Forms of State Support
Proposals for Additional State Support
Reluctance and Resistance to Change
Tax Relief - A False Trail
Conclusion
9 Lessons from Canada
Introduction
Political Parties in Canada
The Election Expenses Act 1974
The Parties and their Funds
Bill C-24, Political Donations and State Funding
The Impact of Bill C-24
Bill C-24 and Party Structure
Conclusion
10 Building on PPERA
Introduction
The Next Step - Regulatory Objectives
The Problems with Contribution Limits
Donations - Let the Members Decide
A Focus on Spending
State Aid: Building on the British Model?
Making a Fresh Start - Back to Houghton
Qualifying Conditions for State Support
Promoting Democracy: A Quid Pro Quo
Conclusion
Appendices
Appendix 1: Exchange of Letters between the Labour Party and Sir Patrick Neill QC
Appendix 2: Annual Accounts of the Political Parties
Appendix 3: The Structure of the Labour Party
Appendix 4: From Election Funding to Political Funding in Germany
Appendix 5: State Funding in Sweden - Party Autonomy and Public Funding

“...an authoritative account of party funding. It deserves to become the standard work on the subject.” –  Vernon Bogdanor, The Times Higher Education Supplement

“This thoughtful yet hard-hitting account provides a route map through the complex maze and is an unsurpassable text book on one of the building blocks of British democracy. For anybody interested in the way we are governed and the fair and transparent funding of politics it is well worth paying the price.” –  Chris McLaughlin, Tribune

“…Sir Hayden does not have the monopoly on good ideas for party reform. There are other academics in the country who have come up with alternative, but similar proposals. May I ask my right hon. Friend to look at the work of Professor Keith Ewing…” –  Mr. Tom Watson (West Bromwich, East) (Lab), Reference from the House of Commons

“Ewing does a thorough job in identifying the problems in the system.” –  Émile Meyer, Unlock Democracy

“In this timely new book, Keith Ewing addresses the root causes of the current cash-for-honours affair…” –  Richard Muir, Progress Magazine

“...The Cost of Democracy is an exemplary lesson in how to address the vexed issue of party funding in particular context...The general discussion of regulatory objectives and methods in chapters two and three can hardly be bettered. And the exploration of how these objectives and methods apply in the United Kingdom is both illuminating and thought provoking.” –  Andrew Geddis, Public Law Review

“K. D. Ewing provides an excellent survey of the problems facing British parties in the light of the 'cash for peerages' funding scandal…this book will prove valuable to anyone interested in current debates on party funding. It deserves to shape the future development of Britain's party finance regime.” –  Thomas Quinn, Political Studies Review, Vol 6, No. 2

“The book is a model of clarity, superbly structured and extremely well written: it will provide students and others with an excellent introduction to the subject and political participants with a clinical appreciation of the current situation...a very substantial contribution to debates about what will be done next, through his clear analysis of the contemporary scene. The book is required reading for all concerned with the nature of British politics.” –  Ron Johnston, Representation

“Ewing's book is an excellent contribution to the debate on the funding of political parties. It examines the ways that legal regulations can be used to advance democratic ideals, but in a way that appreciates the practical implications for UK politics. As a result, its arguments and proposals are realistic. The text also provides a valuable and accessible account of the history of and trend toward the legal regulation of political parties, as well an analysis of the
data on party funding held by the Electoral Commission. As with any text on this topic, there is much to take issue with. The Cost of Democracy provides a persuasive and original take on the funding of political parties, and will be an important reference point in future debates on this issue.” –  Jacob Rowbottom, Public Law