Cut foreign political donations, says UK government ethics adviser

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Sir Keir Starmer’s adviser on culture has called on the government to “protect electoral integrity” by limiting donations from companies to UK-made profits, fearing that Elon Musk could disrupt British politics with a large donation to Reform UK.

Doug Chalmers, chairman of the Government’s Committee on Living Standards, told the Financial Times that the law should also be changed so that political donations made by businesses do not exceed their after-tax profits for the two previous years.

“What is at stake here is the fundamental fact that only those who have the right to vote and do business in the UK should be able to fund our political parties and therefore influence the outcome of UK elections,” Chalmers said. “It is an important step that needs to be taken to address security in the UK elections.”

Chalmers was speaking after Reform UK leader Nigel Farage said he had met Elon Musk and the US tech billionaire. he was thinking of giving more money to a large party.

The revelation raised concerns at Westminster that Musk’s financial intervention could have a major and lasting impact on British politics, giving Reform UK the resources to turn it into a country. reliable car power.

It also explained about a long term tip in electoral law which means that foreign nationals can make donations to UK political parties through British-owned businesses although they are prohibited from giving directly.

The United Kingdom’s Electoral Commission, the UK’s electoral body, said on Wednesday that it is in talks with the government about changing the law to ensure that only benefits available in the UK can be given to political parties.

Vijay Rangarajan, head of the Electoral Commission, said “the system needs to be strengthened . . . to protect the electoral process from foreign interference”.

But the proposals put forward by Chalmers and Rangarajan are likely to reduce the contribution of Musk, whose company has made a profit of £90mn in the UK over the past two years.

According to their latest accounts, X’s UK media company, Twitter UK, made a pre-tax profit of £14.5mn in 2021 and 2022, while Starlink Internet Services UK Ltd made a pre-tax profit of £226,000 in 2022 and 2023.

Tesla Motors Ltd, the UK subsidiary of Musk’s electric car company and in which it is the largest shareholder with a 13 percent stake, made a profit of $74mn before tax for 2022 and 2023.

Musk’s AI company xAI was also incorporated in the UK last week, giving him a new vehicle to fund Reform. It has not published any accounts yet.

The Standards for Our Lives Committee has required that corporate political donations only be made from profits made in the UK since 1998.

Chalmers said he was “encouraged that the government has publicly stated that it is looking at this area”.

Labor pledged in its election manifesto to “protect democracy by strengthening rules on donations to political parties”, citing concerns about foreign interference.

Government officials told the FT they were looking at changing the rules to limit corporate donations to UK-made profits, but said no legislation would be introduced next year.

A number of countries have strict laws against people who have too much power in elections. In France, companies are not allowed to donate to parties or candidates, while individuals are allowed to donate up to €7,500 a year.

In Finland, no single donor can donate more than €30,000 per year, according to Transparency International.