David Cameron is coming under increasing pressure to halt or reduce planned cuts to taxpayer funding to opposition parties, amid fears that both smaller parties and Labour will be hit hard.
Buried in George Osborne’s autumn statement was a proposal to slash £10m of so-called ‘Short Money’ - cash which helps politicians do their job at Westminster - by 19% from this April.
But with a Commons vote looming on the cuts, the Government could be defeated as a handful of Tory MPs are set to join a united opposition claiming the move would be “bad news for democracy”.
HuffPost UK has learned that the cuts are now expected to lead to redundancies for key Parliamentary support staff for the Democratic Unionist Party (DUP), the SDLP, Plaid Cymru and Greens as well as the SNP and Labour.
The DUP would lose upto three staff, while the SDLP, Greens and Plaid would be forced to cut at least one staff member each - all of them from small teams working on policy and scrutiny of the Government.
With a majority of just 12, Mr Cameron is being warned that he risks losing goodwill from parties that he may rely on over the coming Parliament. DUP leader Nigel Dodds told HuffPost UK that it was time for the Government to “think again”.
Just weeks from the planned date for the cuts, all parties are scrambling to assess the impact. It is understood that Labour is facing the loss of upto 20 policy advisers, known as ‘pads’, a move that would severely weaken its capability to provide effective Opposition.
Yet with the Tories increasing spending on their own special advisers by £800,000 to £9.2 million, including a 42% pay rise for the advisor credited with changing Mr Osborne’s haircut, MPs, peers and some ministers fear that the cuts would be seen as unfair.
The Tories already have the huge resources of the civil service to support them, as well as their own 94 ‘spads’, and ministers have privately warned that cutting Opposition resources will come back to haunt the party when it is forced out of office in the future.
Former Shadow Home Secretary David Davis has said the Short Money cut is “the wrong thing to do”, while former Tory Cabinet minister Lord Forsyth said: “Short money is supposed to enable the Opposition to operate in Parliament; it is nothing to do with party politics as such and is being cut.”
The Chancellor has been determined to reduce the amount of public money spent at Westminster, as part of the Government’s austerity plans for the public sector and as part of a wider pledge to ‘cut the cost of politics’.
The Conservatives point out that Short Money increased from £6 million in 2010-11 to £9 million in 2015-16. They add that funding per Labour increased from £20,000 in 2010 to £28,000 in 2015.
MPs believe that Downing Street is not as wedded to the cuts as the Treasury. Mr Osborne wants to cut by 19% both the £9.3 million spent on Short Money in 2015/16 and a £2m-a-year Policy Development Grant in the next financial year. Short money would be frozen in cash terms until 2020 thereafter.
Critics say the £10m in total savings to the Government are tiny compared to the Treasury’s overall budget savings but would have a devastating impact on Parliamentary scrutiny.
But just as with the Trade Union Bill’s assault on Labour’s funding, Mr Osborne infuriated the other parties by failing to consult them before making the unilateral announcement. And some in Parliament believe that the cuts will mean that some of the smaller parties will effectively ‘cease to function’ in terms of policy scrutiny.
Short Money is named after Ted Short, the former Commons leader who introduced the taxpayer cash for opposition parties in the 1970s. It is s calculated according to a complex formula related to their number of MPs and votes at the last general election.
The Commons Members Estimate Committee has limited powers to amend the proposed cuts but MPs believe it will require a motion debated on the floor of the House of Commons at some point in coming weeks.
The DUP has assessed that the combined impact of the cuts to short money and policy development grant would be a cut of £62,000 next year and £248,000 over the four remaining years of the Parliamentary term, a huge reduction that would cost the DUP up to 3 staff.
Mr Dodds told HuffPost UK: “I regret the lack of consultation that preceded the Government’s unilateral announcement about Short Money cuts. They would be well advised to think again, and actually consult with other parties in the Commons.
“And as and when they do, a much more equitable solution should clearly be found on this matter. It would be sensible and prudent for the government to follow this course of action.”
Labour points out that it trebled Short Money in 1999, when it had a huge majority and the Tories were at their weakest in years. Sir George Young – then Shadow Leader of the House – observed at the time “A healthy democracy depends on a well-briefed, well-resourced Opposition. That is good for government as well.”
Labour is expected to lose £1.4m every year under the cuts, with around £400,000 of the shortfall coming from cuts to ‘Policy Development Grant’, which is administered by the Electoral Commission.
The reduction means that Labour may lose upto 20 policy advisers split between Jeremy Corbyn’s leader’s office - which is funded entirely from Short Money - and others working for the Shadow Cabinet.
The party has yet to spell out full ‘doomsday scenarios’ but one option would be to share one adviser between two shadow ministers, as well as other cuts.
HuffPost understands that it is highly unlikely that Labour will simply seek new loans to cope with the funding loss, as it has spent years finally becoming debt- and loan-free under general secretary Iain McNicol. ‘We have to live within our means,” one source said. Taken with the planned £8m loss in funding due to the trade union bill, the party is having to look at deep staff cuts.
On the Policy Development Grant, the Electoral Commission has recently written to ministers to suggest that Labour and the Tories will suffer bigger cuts proportionately compared to the smaller parties.
The Liberal Democrats have objected to the cuts in Short Money too but they are largely cushioned from the impact because they have more than 100 peers in the House of Lords, whose policy support will be unaffected.
Critics point out that while ‘Short Money’ is to be cut, the equivalent ‘Cranborne Money’ for the Lords will be untouched. The independent Institute for Government has pointed out that the ‘cutting the cost of politics’ argument has been undermined by Mr Cameron’s creation of 233 new peers since he became Prime Minister - which has added a potential £70,000 to the taxpayer’s bill every day that the House of Lords sits.
A Cabinet Office spokesperson told HuffPost: "Since 2010, there has been a massive stealth increase in the cost of taxpayer funding of political parties. Short Money has soared by almost 50 per cent, and is set to rise further over this Parliament.
"It is only fair that political parties should play their role in tackling the huge deficit left by the last Labour government."
But as Government sources insisted all the parties should 'calm down' over the proposals, the Cabinet office hinted that the final detail would be more palatable.
"Discussions with political parties have been taking place about the best way to implement these changes and the Cabinet Office will shortly be publishing a consultation paper on delivering the savings to Short Money announced in the Autumn Statement.," the spokesperson said.
The Green Party estimates it will lose an estimated £40,280 from the changes, which means a "very experienced member of staff" will have to be made redundant from its small parliamentary team.
Caroline Lucas MP said: “Clearly this Government doesn’t like scrutiny.
“The cuts to funding to opposition parties will hinder them in carrying out the crucial role of properly analysing, amending and oppose legislation. Taken alongside attacks on trade unions and proposals to curb Freedom of Information it appears that the Conservatives are running scared.
“A functioning democracy needs proper scrutiny of the executive. There is no excuse for these short-sighted cuts – the Government should reverse this deeply political decision and let opposition parties get on with the job of holding the Ministers to account.”
The SDLP would also suffer. Dr Alasdair McDonnell, SDLP leader and MP for South Belfast, told HuffPost UK: “The SDLP maintains an effective and efficient Parliamentary team in Westminster, employing one part time and two full time members of staff to support our three MPs.
“Having a full quota of staff enables us to monitor and respond to the full range of Parliamentary activity. After all, Short Money was brought in to support opposition parties who don’t have the same access to the Civil Service and other resources.
“The reality is the 19% cut to Short Money will be particularly severe for small parties, who already pool their resources and operate with small teams. The SDLP would have to lose a staff member, effectively losing a third of our support team, undermining our ability to hold the Government to account and reducing the service we can provide the public.”
Katie Ghose, Chief Executive of the Electoral Reform Society, said: “The decision to cut public funding for opposition parties by a fifth is bad news for democracy.
"Short money is designed to level the playing field and ensure that opposition parties can hold the government of the day to account, so this cut could be deeply damaging for accountability. Indeed, an OECD report released just this week shows that Britain already has one of the lowest proportions of public funding for parties among developed countries, spending just a tenth of the European average.
“The whole party funding system is a complete mess as it is, but this measure risks making it worse. By removing public money from the mix, this cut risks making parties even more reliant on big donors – with all the potential for corruption that entails.
“Unilateral moves like this risk being seen simply as partisan attacks, and could make it even harder for parties to get round the table and thrash out a deal on the real problem – their over-reliance on big donors’ money. Until we see a cap on donations and a lower spending limit, taking away public money from opposition parties will just make things worse.
“We hope the government listens to the recommendations of the new cross-party Lords’ committee on party funding, which will report at the end of February. We need to move away from tit-for-tat changes and build a lasting party funding settlement.
A Lib Dem source said: "This is not a cut in the cost of politics; it is an attack on democracy.
"While on the one hand the Government wants to cut short money, they are spending £289 million this year alone on spinners and marketing.
"This proposal is a purely partisan move that will backfire on the Government disastrously.”Suggest a correction