Who pulls the strings? Why we need transparency of political donations in Northern Ireland

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1 Who pulls the strings? Why we need transparency of political donations in Northern Ireland September 2012

2 Successful politics delivers the power to take major decisions affecting economic and social life. It is essential, therefore, that political parties obtain their funding in ways free of suspicion that donors are able to receive favours or improper influence in return. Political party finance: Ending the big donor culture Committee on Standards in Public Life, November 2011 Introduction Friends of the Earth believes transparency is essential for a healthy democracy and that a healthy democracy is a prerequisite for a healthy environment. Northern Ireland citizens are the only people in the UK or Ireland who cannot see the names of the individuals and organisations that give large sums of money to political parties. The issue of transparency is particularly important in Northern Ireland where a mandatory coalition system operates. The Survey of Public Attitudes Towards Conduct in Public Life (on behalf of the Committee on Standards in Public Life) found that 71 per cent of respondents thought donors to political parties expected some influence or favour in return. The survey also found that 77 per cent of people thought MPs decisions were influenced by donations, and 85 per cent thought MPs did favours for donors. Clearly, people do not have confidence that politicians are making decisions in the public interest. People s lack of confidence is reflected in falling turnout at election time. The current batch of MLAs was elected by less than 56 per cent of the electorate. The two biggest parties, the DUP and Sinn Féin, received a combined mandate from less than 32 per cent of the electorate. So, nearly half of the eligible voters felt so disengaged with the democratic system that they didn t vote, and more than two thirds decided not to vote for the two parties that dominate Northern Ireland politics. Democracy in Northern Ireland is not in a healthy condition. In the rest of the UK citizens have been able to see a register of major political donors (kept by the Electoral Commission) since 2001, but in Northern Ireland our donor register, which has been kept since 2007 (also by the Electoral Commission), is hidden from view by temporary emergency legislation, renewed every two years. If politicians can take money from anonymous sources, that money can influence their actions without the fear of public scrutiny. This has major implications for objective decision making, in the best interests of all the electorate in Northern Ireland. Public and stakeholder opinion of the Northern Ireland Planning System (December 2011), a report produced by Queen s University, Belfast for Friends of the Earth, revealed serious concerns about the relationship of planning decisions to the public interest and the need for greater transparency. The electorate has a right to know if politicians are making decisions in the public interest, or in the interests of their donors.

3 Busting the myths Opponents of transparency make a number of arguments to support their position. They usually fall into one of the following: 1. The time isn t right; 2. There is no time available in Westminster to draft new legislation; 3. Parties need donations from individuals to survive; or 4. The Electoral Commission monitors donations so there is nothing to worry about. This briefing will attempt to demonstrate how these arguments don t stack up. 1. Political parties claim they want to see full transparency in donations, but that the time is not right. Representatives from political parties often cite three primary reasons why the time is not right for transparency of donations: The security threat, particularly from dissident Republican activity; The threat of intimidation, either from paramilitaries or from activists from other political parties; and The risk to businesses from boycotts. These arguments appear compelling, but in reality they are unsubstantiated and illogical. Unsubstantiated The PSNI does not have a distinct category of crimes relating to political party affiliation. It is hard to see, therefore, what the evidence is for the claims that donors are at significant risk. Without a doubt the perception of intimidation and threats is real. But that is the reality of politics anywhere. Since 2005 sectarian crime has accounted for about 1 per cent of total crime. Threats and intimidation relating to political party affiliation, therefore, will likely account for a small proportion of this 1 per cent. Business people are significantly more likely to be the victims of burglary or fraud than sectarian intimidation because of party affiliation. There is no evidence to support the assertion that local businesses are threatened by boycotts because of the owner s political affiliations. Even if boycotts were established, history reveals them to be ineffective. A global boycott against the Swiss multinational Nestlé has been in operation since Nestlé remains the world s largest food company by sales with a profit in 2011 of $35.65 billion. The Nestlé boycott is well organised, supported by many development charities, and endorsed by celebrities, and still remains ineffective. Other, equally ineffective, boycotts have been organised against Tesco, Nike, Israel, and more. None of them have had a noticeable impact. The Electoral Commission publishes the accounts of political party spending during elections. Such accounts include details of companies that have provided goods and services to parties during an election campaign. Publishing these details does not appear to harm the businesses involved. While there is a perception among the business community that there is a risk of intimidation or boycott, there is no evidence that there is a significant real world risk. If political parties are sincere about their desire to transform Northern Ireland into a fully functioning democracy they should cease pandering to this unfounded perception, and should instead show leadership.

4 Illogical Political parties argue that if donors names are placed in the public domain they will be at risk of violence, intimidation, and boycotts. There are three problems with this argument: A. The names of all elected representatives, election candidates, election agents, and candidate sponsors are in the public domain. If the logic of this argument was followed then either everyone involved in politics should be anonymous, or everyone involved in politics should be in the public domain. If it is considered essential for a functioning democracy that elected representatives, candidates, election agents, and others, to be in the public domain, then it follows that the same is true for those funding parties, who are potentially influencing policy. B. On the one hand we are told Northern Ireland is a dangerous place and the time is not right for transparency, but on the other hand we are told Northern Ireland is open for business. Tourists are encouraged to visit, 2012 is hailed as Our Time, Our Place, and high profile events such as the Irish Open, and the Queen s Jubilee visit attest to normalisation and a successful peace process. It s hard to see how Northern Ireland can be both too dangerous, and peaceful and stable at the same time. C. Northern Ireland is not as unique as is often claimed. Threats, intimidation, and boycotts are a fact of political life all over the world. If the principle of transparency was considered paramount even in the aftermath of the worst terrorist attack in the UK, the attacks on the London public transport system on 7th July 2005, there is no rationale for arguing the principle should be suspended in Northern Ireland. If the threat of terrorism is a reason to keep the donor register secret, then surely every major donor in England, Scotland, and Wales in under threat. MPs that supported the Iraq war, or voted for draconian security measures will all have big donors contributing to their re-election, as will their parties, so why is it safe for those donors to be named, and not the ones giving money to Northern Ireland s parties? Furthermore, a Respect supporter in areas of England dominated by The English Defence League, or a BNP supporter in places with high Muslim populations could reasonably make the argument that they are at significant risk. Northern Ireland does not have a unique or unusual claim to political intimidation. 2. The Northern Ireland Office claims there is no Westminster time available to draft new legislation Whatever the Northern Ireland Office decides to do Westminster time will be required. The NIO has three options: i. Renew the temporary legislation that requires the Electoral Commission to keep the register of donors secret; ii. Allow the temporary legislation to lapse without renewing it; or iii. Draft new legislation to remove anonymity for future donors, but retain anonymity for legacy donors. Option i will require NIO time in the form of a public consultation, and Parliamentary time to debate and vote through the temporary legislation. Option ii will require Parliamentary time in order to clarify a discrepancy between the Northern Ireland (Miscellaneous Provisions) Act 2006 and the associated Explanatory notes. In Part 3: Donations for Political Purposes, the Explanatory notes state,

5 However, to guard against intimidation of legitimate donors, reports submitted before the end of October 2010 (or later, if this period is extended with the approval of Parliament) will remain confidential. It is evident that the legislation and the legislation s Explanatory notes have contradictory intent. The NIO would, therefore, have to draft new legislation to remedy this discrepancy. Realistically, option ii and option iii are the same. Or put another way, option ii is not an option. It is apparent that whatever course of action the NIO decides upon, Westminster time will be required. 3. If funders are discouraged to give money where will political parties get funds? Without funds there would be no politics The 13th Report from the Committee on Standards in Public Life, Chaired by Sir Christopher Kelly, made a number of recommendations to move party funding away from a reliance on donations. It recommended a cap on donations and an increase in public funding. Parties already receive large amounts of public money through the salaries and expenses of elected representatives. It would cost less than 3 per citizen per year to fund political parties. This would break the relationship between big business and big politics, making the politicians much more directly answerable to the electorate. Friends of the Earth believes there should be a full and open public debate on how political parties should be funded. Any funding mechanisms should have the support of the electorate, be transparent, and encourage people to engage with democracy. to the Public Register. If donors wish to remain anonymous they can simply donate below the thresholds. 4. The Electoral Commission monitors donations to political parties The role of the Electoral Commission is to ensure donations come from permissible sources, maintain the public register of donors, and publish parties accounts. It is not the job of the Electoral Commission to monitor party policies to check they haven t been influenced by donors. Conclusion Transparency is essential for a healthy functioning democracy. Secrecy is poisonous to public trust and confidence. For this principle to be overridden there must be overwhelming evidence. The arguments put forward by proponents of anonymity are unsubstantiated, illogical, and in some cases fallacious. Furthermore, transparency is supported by the people of Northern Ireland. According to the Electoral Commission s post-election research 2010, 62 per cent of people supported transparency. Only 10 per cent of respondents supported anonymity. In addition, the NIO consultation Donations and Loans to Northern Ireland Political Parties: The Confidentiality Arrangements (2010), found full transparency was supported by 77 per cent of respondents. Evidently, introducing transparency for donations to political parties would be a popular measure. Friends of the Earth therefore asserts that transparency of political party funding should be introduced without delay. It is worth pointing out that transparency does not prevent donors from funding political parties. Only those donations above the thresholds will be added

6 For more than 40 years we ve seen that the wellbeing of people and planet go hand in hand and it s been the inspiration for our campaigns. Together with thousands of people like you we ve secured safer food and water, defended wildlife and natural habitats, championed the move to clean energy and acted to keep our climate stable. Be a Friend of the Earth see things differently. Friends of the Earth Ltd 2012, company number registered office: Underwood Street, London N1 7JQ Tel: Fax: Website: Friends of the Earth Northern Ireland 7 Donegall Street Place Belfast BT1 2FN Tel: Fax: Website: Friends of the Earth Limited, a registered charity

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