The City must stand up and be counted at this election: Its future is now at stake

By Havard Hughes, Director of Public and Regulatory Affairs at MRM

It must have seemed like a jolly jape, dreamt up behind the Parliamentary bike sheds. The coalition had a brilliant wheeze to stitch up the unions by introducing a spending cap at elections. No longer would Labour have access to limitless pots of cash from their union barons. Better still, the brothers would be forced to reveal their shadowy party-political hand. But this little noticed land grab has had unforeseen consequences. With the general election now 99 days away, it could mean that City voices are silenced – just as plans to ratchet up taxes and regulation are being debated and an EU referendum looms.

So panicked are some groups in the City that rumours abound that many are contemplating a protracted period of silence. If this were to be the case, it would not only be a gross abdication of duty, but a disservice to both democracy and these groups’ members. According to a report prepared for The CityUK, the UK financial and professional services sectors contributed some £174bn to the UK economy in 2012, paid £65bn in tax in 2012-13, and employed 2m people. This makes the City the UK’s most important industry. The idea that no-one will speak for it during the next few months, and possibly for years afterwards, is surely absurd. The idea that no-one will speak up for financial services when we potentially have a referendum on leaving the EU in 2017 is positively sinister.

So what is this new law? Essentially, those spending money during election campaigns in a way that can be seen as “party political” must now account for this spending and register with the authorities. There is also an upper limit, policed by the Electoral Commission, as to what is acceptable. These changes came from the Lobbying Act, which updated the lugubriously named Political Parties, Elections and Referendums Act.

That sounds simple enough. The unions can no longer funnel their members’ hard-earned subs to boost friendly MPs without putting the whole thing in the public domain. More significantly, the legion of state-funded campaign groups that have mushroomed in recent years will have to publicly disclose if they are essentially campaigning for MPs and parties that will keep funnelling them taxpayers’ money.

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