Two major potential abuses are left open by the proposed reform of party funding by the committee on standards in public life (Cap on donations could cost Labour dear, 30 August). One is the influence of banks. Although donations are to be controlled, there will be no control on loans. Loans are a large issue ? Labour is �10m in debt, the Tories �2.6m. The ability to make loans not only buys influence directly but also longer-term, by making parties beholden to debt. The need to repay loans, at a given time, may make parties susceptible to influence.
Second, the proposed limit on donations from any single donor would not stop structured finance from linked groups. A hot issue in US politics is the influence of the American Israel Public Affairs Committee. Endorsement by Aipac does not bring candidates a large single donation from Aipac itself but rather a number of donations from related organisations ? yet the net effect is a well-organised funding machine, worth millions, with considerable political influence. The political legitimacy of Aipac is not at issue but it shows how any large source of finance could be structured to circumvent the proposed rules.
The standards committee proposes an impartial state body should provide parties' funding instead of large individual donors, although even this will skew and dictate the "rules of politics". Parties have become dependant on funding to support expensive PR campaigns because they have rapidly dwindling membership ? with no one to conduct canvassing. Would it be right for public funding to perpetuate this? Shouldn't the political success of parties depend on public support rather than public funding?
Nathan Allonby
North Shields, Tyne and Wear
Source: http://www.guardian.co.uk/politics/2011/aug/31/donor-effect-political-funding
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