The diminishing returns of political party membership and funding

by Charlie_East_West on July 31, 2013

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The Electoral Commission has just published the statement of accounts for the major political parties in 2012 – and it makes grim reading for the Lib Dems.

The Lib Dems raised £6.02m in 2012 but spent £6.4m – which results in a deficit of around £400,000. Over the same period, its membership fell from 48,934 to 42,501, a fall of 35% since 2010 (when it stood at 65,038). This makes it the lowest annual membership figure in the Lib Dems 23-year history. If the Lib Dems continue on this sharp descent of membership, then UKIP (with around 30,000 members) will soon overtake them as the third largest party in terms of membership.

Labour showed a drop in membership – from 193,300 to 187,537. But, in terms of funding, Labour, has shown its 2012 finances to be in a pretty good place. They showed a total income of £33m – aided by the £6.7m of state/short money for an opposition party. The overall figure was up from £31.2m in 2011. As their total expenditure in 2012 was £30.2m, this left a surplus of £2.8m. However, this is all before a future fall out from Ed Miliband’s crazy proposal to change the rules of engagement about trade union funding. It is predicted that around 90% of trade union funding towards Labour will disappear when the new opt-in system promised by Ed Miliband is introduced.

As for the Tories – they raised £24.2m, up from £23.7m last year, and they spent £23.3m. This leaves a rather nice surplus – especially when adding the additional hidden wealth generation that is plopped into the party coffers from fat cat city influencers/funders. This overall rosy financial situation for the Tories is in stark contrast to George Osborne’s economic management of UK plc.

As a party that falsely claims to be transparent, the Tories still refuse to release details of their membership figures. This is estimated at around 150,000. The income from Tory members has fallen from £863,000 to £747,000 in 2012 – a drop of 13%. Perhaps the right wing goose steppers have decided to swivel their eyes towards Nigel Farage.

There are a few key themes that emerge from all of this:-

1) Ed Miliband needs to be careful what he wishes for. If his proposal for an individual opt-in system of trade union funding is implemented, then Labour has a financial time bomb lurking down a darkened alleyway.

2) The Tories remain financially flush from their undisclosed ill gotten gains outside of membership financing.

3) The Lib Dems are paying a hefty price for their coalition with the Tories. As an ideologically flip flopping, manifesto destroying and austerity enabling political party, they are now seen as Tory puppets. They have lost trust. They are now exposed as the exact opposite of everything that they used to claim to care about. Whatever happened to their pre election claim to be a party for social justice? The membership is dropping off a cliff as a result of three years of ideological dismantling. Cutting to the chase, most people now see the Lib Dems as having displayed the worst betrayal in party political history. Vote Lib Dem in 2010 = Tories in power. Most people voted Lib Dem for that scenario to be avoided.

4) Overall party membership is woefully low. Political affiliation has become marginalised due to a collective lack of trust in political parties. It is now a club for wonks, tribal believers and those with vested interests.

5) It is time for state funding. This would potentially eliminate cloak and dagger funding and create some sort of financial level playing field for the main parties. Perhaps a 5% levy on MP’s salaries would help contribute towards such an initiative?

Political party membership is dwindling, and therefore this presents a clear and present danger to party funding. The lack of trust in our tribal, corrupt and reactionary politics is now beginning to bite hard on party finances. Unless a workable solution is agreed upon, we will see austerity being applied on the mechanisms deep within our party political machines – and this presents a threat to the campaiging process, especially during elections.

Something has to change. But, the question remains, will it change?

{ 12 comments… read them below or add one }

Jackie South July 31, 2013 at 1:06 pm

An interesting and thought-provoking piece, Charlie.

At this point in the cycle, all three main parties should be hoping to be stacking up healthy surpluses so that they have enough in the tank for the general election. The 2014 Euro elections would dent these surpluses a little, even without Miliband slashing away at Labour’s financial wrists.

That of course suggests that the Lib Dems are in a lot of trouble: 2013 will probably be more expensive for them than 2012 given the Eastleigh by-election and the county council elections (although there were less council elections over all than 2012). The Euros next year, along with another heavy year for local elections (e.g. the all out elections in London where they will be desparately trying to hold Kingston and Sutton). They are likely to have a fairly empty tank by the time the general election comes around.

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Charlie_East_West July 31, 2013 at 1:50 pm

Completely agree. The Lib Dems have also previously relied on a small army of activists and councillors to work their arses off during an election campaign – often on an unpaid voluntary basis. But, because of the recent local election culling of their councillors and the drop in members due to the coalition – such levels of active on the ground support cannot be relied upon at the next general election.

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George_East July 31, 2013 at 1:44 pm

You can’t make up the level of idiocy it takes to de-fund your own party in the year running up to the general election. Particularly in circumstances in which the public don’t give a fuck and the people being critical (the Tory Press, the Conservative Party, the Ultra-Blairites) will keep on being critical whatever you do. Pathetic.

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Charlie_East_West July 31, 2013 at 1:53 pm

Ed Miliband’s funding decision simply highlights the problem with Ed Miliband. A decent man who is displaying over intellectualised idealism and naivety.

He wants to force transparency over Tory funding. The only form of transparency he will get from the Tories here is the sound of laughter.

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George_East July 31, 2013 at 2:46 pm

I bet George Osborne cannot believe how Ed M walked straight into his trap on this.

NO ONE GIVES A TOSS ABOUT FALKIRK. It was an internal party matter that should have been dealt with. The Westminster Village has an attention span of a goldfish, it would have moved on to other things very quickly. Instead Ed M makes it a story that runs for a year (until the special conference next year) and ends with ‘victory’ meaning the defunding of the Party in the run up to the election.

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Charlie_East_West July 31, 2013 at 2:54 pm

The same trap was set and then sprung on austerity.

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George_East July 31, 2013 at 3:03 pm

Yep – walked straight into that one too. Same problem – desire to be taken seriously by the Westminster Village, not understanding that it will never happen.

Mike Killingworth July 31, 2013 at 7:41 pm

I’m not sure Ed M is as dim as you seem to think.

Consider: what’s the chance that both Tories and Lib Dems will have proposals on TU funding of political parties in their manifestoes? Proposals that will perhaps require TUs to be completely divorced from political parties.

Consider: the votes that Clegg has lost to Labour are largely those of former Social Democrats. What’s the best dog-whistle Ed M can come up with to keep them in his column?

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Charlie_East_West July 31, 2013 at 7:45 pm

It will seriously damage Labour’s finances.

Ed M has a million targets to pick in terms of enlightened policy development, and yet, he picks an issue that no one cares about.

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George_East July 31, 2013 at 8:34 pm

I don’t think he is dim at all. Quite the contrary I think he is very bright. I do think though he fails to understand that the Tories treat politics like a street fight. It’s naivite not stupidity that is his problem He wants to be seen to be ‘doing the right thing’ but fails to realise that nobody is watching. And just because your opponents want to de-fund you, doesn’t mean you have to do it yourself.

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Jackie_South July 31, 2013 at 8:10 pm

What is so tragic about the Ed Miliband decision is how stupid the Falkirk thing was in the first place: apparently the sole issue that led to the party inquiry, getting the police in etc, is a single case of a bloke signed up by Unite who decided to also sign up a couple of other members of his family without their knowledge. Not good, but hardly worth setting wheels in motion that financially screw the Labour Party for eternity.

And of course these two unwilling members would have been unlikely to vote in the selection anyway, so the real impact on the Falkirk selection was precisely the square root of f*** all.

The Tories must be pissing themselves laughing so much that the cabinet room now resembles a paddling pool.

The real problem in Falkirk of course is the party ineptness that let a membership in a rock solid seat dwindle to 100 members before the Unite membership drive.

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George_East July 31, 2013 at 8:35 pm

Two words explain that. Denis Canavan.

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