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Straw proposes party spending cut Straw: 'End excessive spending'
(about 1 hour later)
Justice Secretary Jack Straw has called for an end to the "damaging arms race" in election spending with proposals for a curb on funding during campaigns. Jack Straw has put forward measures to beef up the Electoral Commission's powers to tackle "excessive" spending by political parties.
He intends to introduce a Bill before the summer recess to reform the Electoral Commission and place more controls on candidates' spending. The justice secretary said the amounts spent by the two main parties - Labour and the Tories - before elections had spiralled into a "spending arms race".
It follows Sir Hayden Phillips' inquiry into the future of party funding in the wake of the cash-for-honours row. He said a White Paper proposed to tackle the problem by redefining what counted as campaign spending.
Tory Francis Maude said union donations to Labour was preventing reform. But the Tories said union donations to Labour were preventing reform.
Mr Straw said legislation could only be effective with the support of all parties and members of the public. Mr Straw told MPs the White Paper on party finance and expenditure would build on proposals by senior civil servant Sir Hayden Phillips, which called for reform of the Electoral Commission, tighter controls on expenditure and a move towards state funding, linked to a cap on donations.
'Undue patronage' 'Clear signal'
The plans, contained in a white paper, would build on Sir Hayden's proposals, he said. Under the plans the Electoral Commission would have "more effective investigatory powers, enabling it to access information from anybody where it suspects a breach of the rules".
"It's excessive spending by parties and candidates that gives rise to the wider problems with party finance that we see today," he told MPs. There would be "robust civil sanctions, with criminal proceedings as an alternative".
"Strengthening the Electoral Commission will send a clear signal that politics and politicians are effectively scrutinised - never above the law," Mr Straw said.
The White Paper proposes a return to the system of "triggering" which would regulate all candidates' spending up to the point they are elected.
Mr Straw said he was ready for a "debate" on a curb on donations - but did not indicate any maximum figure.
'Regret'
Sir Hayden had proposed a cap at £50,000 on individual donations in his review of funding.
Mr Straw said to introduce caps "we would not only have to have all the main parties with us, but the public, the taxpayers, as well" because any limit would involve enhanced state funding.
"That is not the case at present," he said, adding that it was a "matter of great regret" that cross-party talks chaired by Sir Hayden had broken down after the Tories walked out.
The two biggest parties - Labour and the Conservatives - spent £90m in the 12 months before the 2005 general election, up from £65m in the 12 months before the 2001 poll, he said.The two biggest parties - Labour and the Conservatives - spent £90m in the 12 months before the 2005 general election, up from £65m in the 12 months before the 2001 poll, he said.
"In the interests of democracy ... stop this damaging arms race," he said."In the interests of democracy ... stop this damaging arms race," he said.
Mr Maude, the shadow Cabinet Office minister, said he agreed party funding reform was "very much needed in order to restore trust in our politics to deal with the perception that large donations, whether by individuals or organisations can buy undue influence or patronage". 'Restore trust'
Lord Ashcroft The Tories said trade union donations should be included within a limit on donations while Labour wanted an end to the use of Conservative backer Lord Ashcroft's millions being targeted on marginal seats.
Shadow Cabinet Office Minister Francis Maude said he agreed party funding reform was "very much needed in order to restore trust in our politics to deal with the perception that large donations, whether by individuals or organisations can buy undue influence or patronage".
However, he argued that 92% of Labour's income was from the unions.However, he argued that 92% of Labour's income was from the unions.
"It is precisely Labour's dependence on these unions bosses and the big donor culture that's preventing the reform that our politics desperately needs," he said."It is precisely Labour's dependence on these unions bosses and the big donor culture that's preventing the reform that our politics desperately needs," he said.
The move to cap donations is likely to be seen as an attempt to limit the influence of major donors, such as the wealthy Conservative backer Lord Ashcroft.The move to cap donations is likely to be seen as an attempt to limit the influence of major donors, such as the wealthy Conservative backer Lord Ashcroft.
Union donations may also be included in the spending limits, which is likely to prove unpopular with Labour backbenchers.
The proposals follow 18 months of cross-party talks which stalled in October, amid failure to agree on a raft of recommendations in a review of party funding by Sir Hayden, a former civil servant.
The Tories said trade union donations should be included within a limit on donations while Labour wanted an end to the use of Lord Ashcroft's millions being targeted on marginal seats.
In December, Prime Minister Gordon Brown pledged to push through the reforms, following revelations that gifts of more than £650,000 had been given to Labour by businessman David Abrahams using proxy donors.In December, Prime Minister Gordon Brown pledged to push through the reforms, following revelations that gifts of more than £650,000 had been given to Labour by businessman David Abrahams using proxy donors.
Mr Brown said Sir Hayden's proposals, which include a £50,000 cap on individual donations, provided a comprehensive framework for reform.
He stressed everything was up for negotiation, including a possible extension of public funding - although he acknowledged that was likely to be controversial with voters.