British election spending laws explained – and why they need updating

The Electoral Commission is investigating allegations regarding spending by the Vote Leave campaign in the 2016 referendum. Andy Rain/EPA

Back in November 2017, the Electoral Commission reopened investigations into allegations that Vote Leave, the official exit campaign in the 2016 referendum on UK membership of the European Union, had breached spending rules.

Into 2018 this was a story that had rather bubbled under the surface. However, a slow drip of revelations regarding the work of Cambridge Analytica, unearthed by The Guardian, The Observer and Channel 4 News have brought the issue to the front and centre. It is worth reminding ourselves how the case got here, and what it means for the electoral integrity of the UK.

The rules

During referendums in the UK, there are strict spending rules which designate the amount of money official, or “designated”, campaigns are allowed to spend. In 2016, Vote Leave and Britain Stronger in Europe had a limit of £7m.

The £7m spending limit, however, only related to spending by the official campaign for each side – Remain and Leave. The 2000 Political Parties, Elections and Referendums Act (PPERA) also allowed for any number of third party organisations to campaign to either remain, or leave, the EU. On the Leave side, these “registered campaigners” included the groups BeLeave and Veterans for Britain.

The recent allegation laid at the door of Vote Leave is that it colluded with BeLeave – although the commission is also investigating a potential collusion with Veterans for Britain. The commission’s investigation will look at whether the official campaign effectively funnelled money to these other groups, telling them how to spend it (very much against the rules), to circumvent the strict £7m limit. Senior figures from within Vote Leave, including the foreign secretary Boris Johnson, have denied any wrongdoing and said Vote Leave acted within the rules.

Potential punishment

The Electoral Commission doesn’t have a great number of sanctions up its sleeve for any breaches of the rules. If rules are broken they can administer a fine from £200 to £20,000. This would be for a breach of the PPERA, which largely acts as the legislative and regulatory framework for electoral law in the UK.

The level of a fine depends on any number of factors decided by the commission, such as “the seriousness of an offence or contravention” or the “harm caused by the offence or contravention”. So while predictions are, to use a technical political science term, a mugs game, if the allegations reported in The Guardian that Vote Leave did assist in BeLeave’s branding are proved true – and part of a broader collusion – any proven breach could carry the maximum fine.

In 2017, the commission levied a record fine of £70,000 against the Conservative party for filing inaccurate spending with relation to the 2015 general election. At the time, the commission wrote:

This is the third investigation we have recently concluded where the largest political parties have failed to report up to six-figure sums following major elections, and have been fined as result. There is a risk that some political parties might come to view the payment of these fines as a cost of doing business.

The commission has since opened investigations into the spending returns of the Conservatives, the Green party, Labour, the Liberal Democrats and the Women’s Equality party in the 2017 general election.

There are some who’ve said these are merely concerns of “ultra-Remainers who cannot fathom that the country wants Brexit”, or that they are effectively a “displacement activity” for those that don’t want to face up to the larger cultural and political divides that influenced the referendum result. But, this presents a false dichotomy.

It is possible to simultaneously hold the opinion that the referendum revealed fault lines in British politics, that the overspending allegations won’t reverse the result and that that the alleged collusion raises serious questions regarding the electoral integrity of institutions held to be central to democracy. This should not be the preserve of partisan point scoring.

Money is hydraulic

There is much that we do not know about the role money plays in British elections. One thing we do, is that money is like hydraulics. Much like water it can become uncontrollable and, whatever the placement of legal obstacles, it will eventually find a way around and into the political system.

Counting of votes in the EU referendum gets underway in Glasgow. John Linton/PA Archive

Whatever comes of the allegations being investigated by the Electoral Commission, there is now a considerable case for a review into electoral law in the UK as it currently stands. PPERA received Royal Assent in the year 2000. Legislation in this area should be reviewed and updated to take into account the current environment and reflect a changing society.

The current regulations regarding the use of internet campaigning were written in a time of “mini-discs and the millennium bug”, as the Electoral Reform Society put it. The world in the year 2000 is very different to the world in 2018. Electoral law should reflect this.

This is not a partisan political point. That these charges have resurfaced suggests that there is now a case to look again at updating our current regulations which, as it stands, may well be unfit for purpose. To borrow a phrase, perhaps it is time to take back control.