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From The Socialist newspaper, 19 April 2002

State Funding of Political Parties - Supping with the Devil?

NEW LABOUR is considering a proposal for its next manifesto for government funding of up to 50 million for political parties.

In a week where yet more Labour funding scandals have hit the news CLLR DAVE NELLIST, leader of the Socialist group on Coventry City Council, and a former Labour MP, looks at the issue of state funding of political parties.

LABOUR PARTY chair, Charles Clarke, has said that "democratic politics has to be funded either by state funding or by donations, whether from individual members, big donors or trade unions".

At one level you can understand his problem. Labour is apparently 10 million in debt and after five years' experience of right-wing government, its membership has fallen from over 400,000 in 1997 to under 250,000 today.

Not only has that reduced membership income, but there are now whole areas of the country where there is no Labour Party activity between elections - no public meetings, no socials, no campaigns or contact of any sort with working-class families from which, traditionally, Labour used to raise funds.

In February a group of trade unions affiliated to Labour decided to withhold affiliation fees worth 1.2 million. In key unions, such as Unison, GMB, FBU, RMT and CWU, pressure is building up to withhold, reduce or end the financial support given by the unions to Labour. As Glenn Kelly of the 'Free The Funds' campaign has said: "Why should unions feed the hand that bites us"!

Sleazy scandals

LABOUR'S ATTEMPT to secure the moral high ground with accusations of "sleaze" involving the previous Tory government has been severely dented since the Formula 1 affair of 1997, via Geoffrey Robinson and Peter Mandelson, to the current embarrassing revelations of donations from billionaire Lakshmi Mitall (who sought Tony Blair's help in his bid to profit from the privatisation of the Romanian steel industry) and over sponsorship at party conferences by multinationals, such as the US firm Enron, which spectacularly collapsed earlier this year.

But scandals over political funding are not confined to Britain - they are rarely out of the news in most countries.

In Australia in 1998 the Liberals (Australia's Tories) exploited that country's charity laws to gain themselves interest-free loans. In Belgium, 10 years ago, arms manufacturers Dassault and Augusta gave US $3 million to gain contracts and a former Deputy Prime Minister was assassinated, apparently to prevent him from disclosing the secret deals.

Two years ago in Ireland, following allegations that the former Prime Minister (Taoiseach) Charles Haughey received secret donations from supermarket boss Ben Dunne, T-shirts appeared with the slogan: "Ben there, Dunne that, bought the Taoiseach"!

Revelations of kickbacks to political parties surfaced in the 1990s from big business in Brazil, from drug traffickers in Colombia, from companies seeking privatisation in the Czech Republic, from oil companies in France, and from arms manufacturers (again) in India and Sweden.

Use of so-called non-profit organisations to evade election spending limits were revealed in Israel, secret slush funds of 400 million in South Korea, to say nothing of the torrent of allegations in Italy, Spain and the USA.

Election regulations or not, big business will always find a way to gain political influence.

A draft of an EU handbook on state financing of political parties, due out later this year, says: "Recent (unpublished) studies carried out by certain Western governments have revealed the leading role of some parts of big business in corrupting top politicians in developing nations and, thereby, in fostering civil wars fought for control of mineral resources. Whether it is a matter of the trade in armaments, diamonds, oil, tobacco, pharmaceuticals, or powdered milk, it is not necessary to be paranoid or a Marxist to be aware that what used to be called 'monopoly capitalism' has considerable vices".

Workers' representatives

FOR SMALL socialist parties, finance is essential. The Socialist Party is only funded by the regular subscriptions of its members, donations from supporters to our 'Fighting Fund' and by the sales of our paper, magazine and pamphlets.

To be a healthy socialist organisation we need to be funded by the millions, not by the millionaires.

If a socialist party received state funding it would be subject to the old adage "he who pays the piper calls the tune" - at the risk of having its politics determined by the need for the continuation of that funding, and its activities curtailed by the risk of withdrawal.

In any event, no capitalist state is going to want to maintain funds to a political organisation that seeks to fundamentally transform the way in which that society is organised.

The collection of large numbers of small donations from supporters is more than just a financial task, it's a regular contact with the class we represent. The very first Labour MPs, such as Keir Hardie, in the days before MPs were paid by the state, relied on weekly collections at factory gates for their wages - a powerful incentive to do a good job representing workers!

Today the Socialist Party continues that tradition by insisting that all of its elected representatives take no more that the average wage of a skilled worker and donate the balance of their salaries to campaigning for socialist change.

The best guarantee of a healthy socialist organisation is a bigger and more active membership able, by its campaigns and its reputation, to raise the money necessary to sustain the fight to transform society for ordinary working people and their families.

Politics in a capitalist society is dominated by big business and its kept parties. Socialists are fighting for a society in which all views (with the exception of fascists) could get a much fairer hearing. That would mean a socialist society which guaranteed access to channels of communication, press, TV, radio etc for all points of view in proportion to the support for those points of view in society.

Socialists should support the weakening of the dominance of politics by big business but have no illusions in the efficacy of electoral and financial regulation of capitalist parties.

And as far as state funding of politics is concerned - when you sup with the devil, use a long spoon!

There's already a degree of public financing of political parties at Westminster. Last year the Tories got 3.5 million and the Liberals got 1.5 million. The government's Electoral Commission has now announced additional grants this February for eight of the nine parties with MPs in the Commons, totalling 2 million a year, for "research work on policy". And in general elections, candidates get a free posting of election addresses and larger parties get free TV adverts.

Proposals in Britain for public funding seem to be narrow - limited to funds for establishment parties with representatives at Westminster, the Scottish Parliament, or the Welsh Assembly. That would clearly reinforce the status quo of politics where all main parties defend essentially the same ground, ensuring that the interests of big business come first. There will no doubt be an outcry from millions of people who will resent "their taxes" being used to finance parties which preside over unemployment, a vast gulf between the rich and the rest, and wholly inadequate health, education, housing and welfare services.

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In The Socialist 19 April 2002:

Fight Labour's Big Business Agenda

Vote Socialist: For A Fighting Voice On The Council

Venezuelan Masses Inflict Defeat On US Imperialism

State Funding of Political Parties - Supping with the Devil?

Lewisham: Ian Page and Sam Dias Winning Benefits For Local People

Ukraine Elections Expose Lack Of A Workers' Alternative

Israel/Palestine War: The Failure Of Capitalism - The Need For A Socialist Solution


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