On Wednesday 9 September, the Metropolitan Police announced they were opening an investigation into allegations that Reform UK broke laws around party funding and donations. The news of the investigation comes after a Channel 4 investigation appeared to show party officials suggesting ways to circumvent laws prohibiting donations to the UK political parties by foreign nationals.
The law around donations to political parties is outlined in the Political Parties, Elections and Referendums Act 2000 (PPERA), shaping how political parties are funded and how that funding is scrutinised. Before 2000, party funding in the UK was almost entirely unregulated – there was no legal requirement for parties to disclose where their money came from. This fuelled repeated scandals and accusations of “cash for access” or foreign influence over British politics. Following recommendations from the Neill Committee’s 1998 report on party funding, PPERA was introduced to bring transparency and accountability to the system, and to protect UK democracy from covert or foreign interference.
PPERA established the Electoral Commission, an independent body responsible for regulating political finance and overseeing elections and referendums. The Act also introduced the concept of “permissible donors” – only UK-registered electors, UK-registered companies, trade unions, and certain other UK-based organisations may legally donate to political parties. Parties must check that donations come from a permissible source before accepting them.
PPERA allows donations from a wide range of permissible sources and does not cap the size of individual donations – a wealthy individual can legally give a party millions of pounds, provided they are UK-registered. This is often criticised as a loophole, since it permits significant influence from rich individuals.
The Act does not allow for anonymous or foreign donations, donations from impermissible sources (such as foreign companies or individuals not on a UK electoral register), and evasion of reporting rules through multiple small donations designed to stay under the threshold – this is a specific criminal offence.
This is not the first time Reform’s finances have attracted scrutiny in recent months. Nigel Farage faced questions over an undeclared £5m gift from Thailand-based businessman Christopher Harborne, which he said was for personal security; Farage insists he had no obligation to declare a personal gift made before taking his seat. Separately, police are examining around £500,000 in donations routed through TISUN Investments, a company controlled by deputy leader Richard Tice, plus sums from Fiona Cottrell, mother of an aide with a US fraud conviction.
Some commentators have raised questions as to why foreign citizens not resident in the UK would seek to donate to British political parties in the first place, and what impact this could have for democracy in the UK if parties were to become dependent on such income streams. As the world becomes ever more interconnected, enforcing the law around donations becomes increasingly difficult. This could be used as a reason to argue in favour of state funding for political parties, although the public appetite for this is likely to be extremely limited. It also raises extremely complex questions around which parties to fund and how to calculate the amount they should receive.
Last week, it was announced that Reform UK had received two donations of £36m, one from Ben Delo and one from Christopher Harborne, both British businessmen who made their money in cryptocurrency.
These donations are the largest donations ever received by a UK political party, far exceeding the £9m the party received from Christopher Harborne initially. Ben Delo’s past includes being granted a presidential pardon by President Trump after he pleaded guilty to charges under anti-money laundering laws. Whilst the investigation into Reform UK could take some time – as could Parliament’s probe into Farage’s personal finances – it has already had a negative impact on the party’s polling with voters. Although Reform has been keen to dismiss these allegations as an attempt by the “establishment” to undermine them, voters have shown scepticism over Reform’s and Farage’s claims about the allegations to date.