23AUG

Peers table four caps on party donors

3 min read

19:09UTC

The Lords gave the Representation of the People Bill its Second Reading on 14 September; four of the 73 amendments since tabled would limit how much one donor can give.

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PoliticsAssessed

Key takeaway

None of the four Lords donor caps would touch money given before the law takes effect.

The House of Lords gave the Representation of the People Bill its Second Reading, the first debate on a bill's principle, on 14 September⁠¹. The Bill reached peers after the Commons passed it at Third Reading. Committee stage, where peers go through it line by line, had no sitting date as of 5 October, and 73 amendments were tabled for it⁠².

Four would limit how much one donor can give, the ceiling the Commons declined to write in when it added a cryptoasset ban and an overseas-elector cap instead:

- Baroness Hayter of Kentish Town (Labour) would cut the cap on gifts from overseas electors from £100,000 to £10,000. - Lord Carter of Haslemere would let ministers set an annual cap for every donor by order, on an Electoral Commission recommendation. - Lord Cromwell would cap individuals at £100,000 every five years and a party's total donation income at £7m a year. - Lord Carlile of Berriew would cap any UK-resident donor at £5m a year, counting connected persons together.

The designs differ most on who sets the number. Carter's leaves it to a ministerial order and the regulator's advice, so Parliament would not vote on a figure; Cromwell's and Carlile's write one into the Bill, and either would stop a single donor giving Reform UK what Ben Delo gave it in September. As tabled, none of the four reaches a gift made before the new law takes effect.

Conservative frontbench peers argued against retrospective rules at Second Reading⁠³. The Bill already reaches back once, though: its cryptoasset ban is backdated to 25 March.

Deep Analysis

In plain English

A bill becomes law only after both the House of Commons and the House of Lords agree its text. The Commons passed this one, a wide Reform of how elections and party money work, in early September. In the Lords, Second Reading is the general debate. Committee comes next, when peers go through the bill line by line and vote on changes, called amendments. Under the 2000 party-funding law, one person can give a party any amount. Four peers want one. Each proposal would only apply after the law starts, so money already given would be untouched.

Deep Analysis

Root Causes

Article 7 of the European Convention on Human Rights bars creating a criminal offence for past conduct. Lord Cromwell's design carries criminal offences, so it could only ever apply to future gifts.

A civil clawback of money already given would engage the protection of property in Article 1 of the Convention's First Protocol. A party could argue in court that it lawfully owns a banked gift.

Timing sits with the Government. A Lords committee of the whole House meets when ministers' business managers schedule it, so the gap between Second Reading and committee is set by the Government, not by the peers tabling amendments.

What could happen next?

Consequence
Without a committee date, a cap cannot become law before the Lords timetable allows, and every week of delay extends the period in which unlimited gifts stay legal.
Short term · Assessed
Risk
If the Lords adds a cap and the Commons removes it, the Bill enters ping-pong between the Houses, delaying its other provisions, including voter ID changes.
Medium term · Suggested
Precedent
The Bill's backdated cryptoasset ban gives peers who want retrospective caps a precedent inside the same Act.
Short term · Suggested

Source Landscape

This story draws on neutral-leaning sources

Primary parallel: Sir Hayden Phillips's review of party funding recommended a cap on individual donations in 2007, and cross-party talks on it collapsed later that year. The Committee on Standards in Public Life proposed a cap again in 2011, and no government legislated for either.

Counter-parallel: Parliament can legislate backwards when it chooses. The War Damage Act 1965 reversed the House of Lords' 1964 Burmah Oil judgment with retrospective effect, cancelling compensation the courts had already found was owed.

Immediate: the four caps fall unevenly on different parties. Lord Cromwell's text would cap companies at £500,000 and trade unions at £1m over five years, which would reach Labour's affiliated union income as well as large individual donors.

Structural: Cromwell's £7m-a-year ceiling on a party's total donation income would bind the biggest fundraisers in an election year. Lord Carlile's design adds a single £5m aggregate for connected persons, aimed at gifts split across family members, companies and trusts.

Consensus view: Conservative frontbench peers, among them Baroness Finn and Baroness O'Neill of Bexley, argued at Second Reading that rules should not reach back to gifts that were lawful when made. On that view, any cap Parliament agrees starts on the day the Act takes effect.

Counter-view: The same Bill already backdates its cryptoasset ban to 25 March, and the Electoral Commission said that moratorium was meant to apply retrospectively. Lord Pack and Lord Wallace of Saltaire, for the Liberal Democrats, have re-tabled the Royal Commission on caps that the Commons defeated.

Key tension: Whether ministers, who resisted a cap in the Commons, will back any of the four designs once committee opens.

First Reported In

Update #18 · Legal advice halts England's council mergers

House of Lords· 7 Oct 2026

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Causes and effects

Caused by

Rayner's finance Bill goes to the Lords

The Commons Third Reading sent the Bill to the Lords for Second Reading.

Occurred 2 Sept 2026

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Commons refuses a cap on donations

Peers tabled donation caps of the kind the Commons refused to write into the Bill.

Occurred 2 Sept 2026

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This Event

Peers table four caps on party donors

Every cap design before the Lords is prospective, so the size of the next election's war chests is being settled before any limit exists.

Different Perspectives

Rhun ap Iorwerth / Welsh Government (Plaid Cymru)

Ap Iorwerth presented six priorities to the Senedd on 22 September without numeric targets or a named partner party, promising to work across the chamber where there is common ground. He says his government will be judged on results.

Michael Marra / Scottish Labour

Marra won the leadership on 19 September, and three days later his 17 MSPs backed Swinney's right-to-decide motion once their child-poverty amendment was written in. He says Scottish Labour's task is to tell voters what it stands for.

Andy Burnham / Labour Party

Burnham told conference in Liverpool on 29 September that Labour's next manifesto will commit to changing the electoral system, and invited every party into a National Commission on Electoral Reform. He has not named a replacement system, and no chair or remit has been published.

Conservative Party (frontbench peers and Kemi Badenoch)

Conservative frontbench peers argued against retrospective rules at the Lords Second Reading on 14 September, a position that protects gifts made before any cap. Kemi Badenoch rejected Burnham's electoral reform commission on 2 October, accusing him of using it to entrench the left.

Reform UK

Reform denied wrongdoing after the Channel 4 News programme, called the sting a hoax by climate activists and said it would cooperate with the Metropolitan Police. In the same month it announced £36m gifts from Ben Delo and Christopher Harborne.

Steff Aquarone / Liberal Democrats (North Norfolk)

Aquarone told Rayner in the Commons on 7 September that North Norfolk District Council had spent money preparing for a reorganisation the Government has now withdrawn. He puts the cost of the cancelled merger on districts in the four areas.