20.The Committee’s report endorsed and developed the Government’s proposals for a ban on foreign donations to political parties and for open declaration of donations at the level of £5,000 or above. The Act follows the Neill Committee report in using the concept of a “permissible donor”. The principal target is to require political parties to reject donations which are anonymous or which do not appear to be either from a person registered to vote in the United Kingdom or from a company incorporated in a member state of the European Union and carrying on business in the United Kingdom or from an unincorporated association having its main office and its principal sphere of operation in the United Kingdom.
21.The Neill Committee recommended, in general, against attracting any form of liability to donors or would-be donors themselves, except to the extent that they conspire with recipients to evade the recommended restrictions on receipts. There is, however, one significant exception to this general rule. The Committee recommended that, before a company makes a donation, it should be required to obtain the approval of its shareholders. The Government announced its general acceptance of this recommendation, but sought comment on how it should be implemented, in a separate consultation document published by the Department of Trade and Industry in March 1999 (DTI reference URN 99/757). This matter is now dealt with in Part IX of the Act. One further provision relating to donors is also now to be found in section 68 of the Act. This is to deal with a situation in which a donor makes a large number of donations at a level below that at which the recipient has to record and check them.
Background Overview of the Neill Committee report and the Government’s response Donations to political parties