Sleaze watchdog calls for crackdown on ‘shadowy’ funding of British politics

But standards chief admits he has no power to act – saying it’s up to ‘the voters’ to punish rule-breaking

A crackdown on ‘dark money’ in British politics is being proposed by a sleaze watchdog, but it is admitting only voters can punish leaders who break the rules.

Secrecy surrounding who is funding online campaigns and “shadowy” unincorporated associations – often the super-rich donating to the Conservatives – must be lifted, the committee on standards in public life says.

Its report will also urge the government to close a loophole allowing firms to make political donations from profits made abroad, using shell companies.

Lord Evans, the head of the committee, has previously warned of a growing belief that top politicians are “choosing to disregard the norms of ethics and propriety” the UK has grown used to.

“Stronger enforcement” of campaign finance is needed, he said – while pointing out the watchdog can only make recommendations and does not carry out investigations.

Political leaders are “chosen by the voters”, Lord Evans said, adding: “That’s the fundamental aspect of accountability in our system

“You can’t get around the fact that we are a democracy and it is for the voters to decide who they want to take these political decisions.”

In April, the committee called for Boris Johnson to lose the power to decide whether his ministers are investigated for sleaze – but the prime minister ignored the recommendation.

It means there has been no inquiry into whether Matt Hancock broke the ministerial code by appointing his close friend and then lover to “scrutinise” his department – before he was forced to quit.

Meanwhile, the Electoral Commission is losing the power to prosecute law-breaking, just weeks after it launched an investigation into Mr Johnson’s controversial flat refurbishment.

“We can’t tell the government what to do, we can’t instruct parliament on what to do,” Lord Evans admitted, on BBC Radio 4.

The Conservatives have registered at least nine unincorporated associations with the Electoral Commission – including the famous Carlton Club, founded in 1832.

They can legally funnel large amounts of cash to parties, appointing officeholders and trustees with little disclosure of where the money is coming from.

Lord Evans warned the associations “can sometimes look slightly shadowy because you don’t know who has given money to them”.

“They can then contribute funds to campaigns and we believe there needs to be greater transparency about who is giving money to those unincorporated associations,” he argued.

On the lack of transparency for digital campaigning, Lord Evans said: “You can’t necessarily tell who is saying what to which groups of voters.”

And he added: “At the moment, there are no rules that say British-registered companies have to pay for their campaign donations out of UK derived funds.

“Companies in the UK should be paying for their donations to elections through profits derived from their activities here. That makes it much harder to use shell companies.”