‘Dear David,
Brexit, we were told, was all about regaining Britain’s “sovereignty” and being in control of our own destiny. But big money in British politics is a more significant threat to our future than unelected EU bureaucrats ever were.
Even though the Brussels bureaucrats have been removed from the equation, people still don’t feel they have a proper say in how this country operates. One big reason for that is the amount of money, often from opaque sources, sloshing around our political system.
Have you ever thought that the national picture painted by the likes of Boris Johnson, Nigel Farage, and Rishi Sunak differs significantly from the one you see when you look around your own family and friends? You’re not alone.
Britain ranks among the most socially liberal countries in the world on key issues, and a substantial majority now reject many of the established economic assumptions of recent decades. But you won’t see any of that reflected in the current government’s agenda. Westminster is becoming an island of irrelevance, increasingly detached from the concerns of ordinary people.
There’s a reason for that. The government cannot hear the concerns of ordinary people over the hubbub of wealthy donors and other lobbyists with shady financial backers.
As part of our Parliamentary work, we’ve been researching just how broken the system is. In this longer-than-usual email, we’d like to share some of that with you.
Dark Money and Foreign Influence
The UK has particularly lax campaign finance laws. As a result, many donations get through that probably shouldn’t. Yes, there are permissibility requirements in place, but there are plenty of ways to evade them if you want to.
The term “Dark money” refers to donations whose origins are untraceable. Because the ultimate source cannot be confirmed, there is no way of knowing whether that money comes from the kind of person or organisation that shouldn’t have influence over our lawmakers.
One example of dark money is the “Proxy Donation”. These are donations made by one person, who would not be a permitted donor, in the name of another who is. Some examples include:
- Ehud Sheleg, art dealer and former Conservative party treasurer, gave over £600k to the Tory party. Documents later showed that the money originated in a Russian account of Sheleg’s father-in-law – a former official in the old pro-Putin regime in Ukraine. Proxy donations are a complete blindspot in the law, so there was no legal mechanism to hold him accountable for it.
- Lubov Cherdukhin – back at it again – gave money to the Conservative party while her husband was receiving funds from business deals with sanctioned Russian oligarchs. She gave £50k to the Tories 8 days after Putin invaded Ukraine.
- Mohamad Amersi has given over £200k to the Conservatives and worked closely with Boris Johnson on key policy decisions. Prior to the donation, he was given a large deposit from a Kremlin-linked company secretly owned by Putin’s telecoms minister Leonid Reiman.
“Shell Companies” are another way for dubious donors to evade the rules. According to Transparency International, 14% of LLPs established in the UK between 2001-2021 (21,000 companies) show signs of being shell companies. Here are some examples:
- Conservative mega-donor Lubov Cherdukhin, who once paid £160k to play tennis with Boris Johnson, was being paid out by a shell company secretly owned by Russian senator and Putin ally Suleiman Kerimov, according to the BBC.
- The offshore company Aquind is owned by a former Russian oil magnate and a Russian arms manufacturer. The company has donated heavily to the Conservative party.
- Top Labour MPs Wes Streeting, Yvette Cooper, and Dan Jarvis received a combined £345,000 from a company called MPM Connect Ltd, which has no staff or website and is registered at an office where the secretary had never heard of the company.
“Unincorporated Associations” are nebulous groups with little oversight or legal classification. It’s essentially like ticking the “miscellaneous” box on a donation form when asked what kind of organisation you are.
- Tory minister Steve Baker’s “Covid Recovery Group” organisation (a parliamentary coalition of anti-lockdown Conservative MPs) received tens of thousands from a UA called the Recovery Alliance. It has no digital footprint, no registered members, and its finances are completely opaque. Opendemocracy has linked it to a number of other covid conspiracy campaigns and anti-lockdown groups.
- Richard Cook’s “Constitutional Research Group” – of which he is the only listed member and chair – gave £435,000 to the DUP’s Brexit campaign. No one knows for sure where the money came from, but investigative journalists discovered his involvement in a number of illicit trades, including underground trash-dumping and fire-arms sales.
- According to Byline Times, 29 different opaque UAs donated £14 million to the Conservative party between 2010-2022.
Big Money
Between 2001 and 2021, one-fifth of all political donations in the UK came from just ten men with an average age of 70. If that doesn’t indicate that we have a big problem, we’re really not sure what would.
While there’s nothing inherently wrong with political donations, huge amounts of money coming from multinational corporations and the mega-rich does raise questions about who really calls the shots. Especially when they seem to get things in return.
Here are some situations where extremely wealthy individuals and corporations used their financial heft to influence things:
- In 2021, the Conservatives received £400k in donations from oil and gas companies while the government was deciding on new oil and gas licences.
- More generally, the Tories took over a million from oil companies between 2019 and 2021.
- From 2020-2022, the Conservatives took £15 million from the financial services industry, which they were certainly kind to when it came to dealing with banker’s bonuses.
- Labour MP Wes Streeting received £15k from John Armitage, former Tory party donor and manager of a hedge fund that owns half a billion dollars in US health insurance and private healthcare. Streeting recently came out in support of private hospitals.
- The “Leader’s Group” is a dining club of Tory super-donors that has given over £130 million to the party since 2010. The club’s billionaires and business moguls have been known to dine with Boris Johnson.
- In 2022-2023, controversial groups, including gambling giants, climate sceptic organisations, and evangelical Christian groups, made over £1 million in donations for staffing the Labour front bench. Recipients include MPs Wes Streeting, Rachel Reeves, and Yvette Cooper. Reeves alone received nearly £250k.
- Recently, Crossbench peer Caroline Cox received large donations from American evangelical Christian activists against gay marriage that used hateful language about Muslims.
While the Conservatives often top the list when it comes to money in politics, remember that this is a cross-party systemic problem. The real issue is that the rules that are supposed to prevent the wealthy from buying influence just aren’t strong enough. We’ve allowed a situation to emerge where money can buy outcomes almost directly, and the mechanisms to detect the sources of that money are ineffective. Our system just isn’t fit for the 21st century.
The first step to fixing any problem is admitting that there is a problem. Our political system is addicted to money, to the extent that we’re now shutting real people’s voices out on a regular basis.
As you know, Open Britain’s mission these days is to deliver a democracy that works for everyone, not just the rich and powerful. That means a political system primarily driven by people, not primarily driven by money. That’s what democracy was always meant to be about.
As you might expect from what you’ve read above, we don’t take donations from shady think tanks or Russian oligarchs. All our work is funded directly by you, our supporters. We believe that having our work funded through small donations from a large number of people is the healthiest model of all, one that allows us to say what needs to be said to whoever needs to hear it. We hope you agree.
All the very best,
The Open Britain team
Open Britain is proud to be funded entirely
through small donations from our many supporters.
Your generosity makes all our work possible.
Thank you!‘
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