Super-rich donors are distorting UK politics. Why won’t Starmer fix it?

Barely two weeks later, Hong Kong-based cryptocurrency billionaire Ben Delo revealed that he had donated £4 million to Nigel Farage’s party – and that he planned to return home so he could keep donating. “I will move back to Britain early so I can contribute more to Reform,” Delo wrote in the Telegraph.

Delo certainly seems to have cash to burn. Since the Telegraph piece, Delo’s solicitors have been busy sending legal threats to social media accounts that reported his conviction in the US for failing to implement adequate anti-money-laundering controls in his crypto business. (He was pardoned by Donald Trump last year.)

This story is symptomatic of a much wider problem in British politics: the rise of “mega donors”. A decade ago, when I first started writing about political funding, £50,000 was an eye-catching donation. Now donors are small-fry unless they’re giving millions.

Even before Delo’s blockbuster donation, 75% of Reform’s funding had come from just three men. Thailand-based crypto tycoon Christopher Harborne has given Farage more than £20 million. The Tories and Labour have had their fair share of mega donors, too. 

We only have to look across the Atlantic, at the naked “pay-to-play” in Donald Trump’s White House, to see what happens when politics is captured by big money. The UK is no stranger to influence peddling in public office, too. Think of the billions of pounds in contracts doled out to politically-connected VIPs during the Covid pandemic, or the party donors that pepper the House of Lords’ red benches.  

The law has proved little impediment to bad behaviour. History shows that parties don’t mind breaking election legislation when the punishment comes after the count. The puny fines doled out to rule breakers are chalked off as “the cost of doing business” by political insiders. 

Labour came into office promising to clean up this rotten system. The Elections Bill currently going through Parliament contains some useful measures – a moratorium on donations in cryptocurrency, for example – but is timorous and piecemeal where it needed to be bold and ambitious. 

Politicians talk a lot about trust. But the Elections Bill will do little to tackle one of the biggest sources of distrust in British politics: the rise of big money. 

In less than a decade, the share of private political donations coming from individuals and companies giving £1 million or more has surged 35-fold, from just 1% in 2015 to over a third in 2024, according to research by Transparency International. At Democracy for Sale, we found that corporate donations have tripled over the past three general elections. 

So what can be done? Housing secretary Steve Reed has warned that “it is our patriotic duty to safeguard the British people’s right to freely choose their own government.” But are we only worried about foreign money? Shouldn’t we be concerned that anyone able to vote in the UK can give unlimited amounts to politics?

There is a tidy solution to this conundrum: a cap on all political donations, whether from individuals or companies, regardless of where they live. 

Caps on political donations are hardly a new idea. Numerous countries already have such limits, including Australia, France, Canada, and Belgium. Even the United States has a ceiling on campaign contributions of just under $1 million. (The problem, of course, is the limitless cash funnelled through Super Pacs.)

Suggested Reading

Richard Tice says he’s giving hope to millions – his tax affairs may tell a different story

Jonn Elledge

In the UK, experts and transparency campaigners have long advocated for a cap, but successive Labour and Conservative governments have seen more self-interest in keeping the money flowing in. But calls for a cap on political donations are growing louder inside Westminster.

Philip Rycroft, the former civil servant who led the independent review into foreign interference in British politics, explicitly suggested parliament should consider a cap on all individual donations “if it wishes to restore confidence in the political process and to keep big money out of UK politics”.

The All-Party Parliamentary Group for Fair Elections – the largest cross-party group in parliament – has called for caps on political donations. Its membership includes dozens of backbench Labour MPs.

Senior Labour figures have broken cover, too. Last year, David Blunkett told me that Starmer “should get on with” a donations cap to prevent British politics being bought by a handful of billionaires. More party grandees could join the former home secretary’s call as the Elections Bill winds its way through parliament in the coming weeks.

The question of the level at which a cap should be set has been much debated. But having established £100,000 for donations from Britons abroad, the government could simply set that as the annual limit for all donations. Such a move would also deliver that rarest of things in politics: a low-cost policy that is wildly popular. 

Polling by YouGov found that just 13% of people think that individuals should be allowed to give as much as they wish to political parties. Even among Reform voters, a cap is widely supported.

Critics ask how politics would be funded if private money was curtailed, but here, too, there are options. Spending limits, ridiculously inflated by the last Conservative government, can be radically reduced. Small donations could be match-funded. Public funding for parties, long a taboo, could be revisited.

Ben Delo has shown how easily Labour’s curbs on foreign money can be circumvented. Rather than playing party politics, Starmer needs to put the integrity of British democracy first and use his Elections Bill as what it is: a once-in-a-generation opportunity to take big money out of our politics.

Peter Geoghegan is editor of the award-winning investigative news site Democracy for Sale