The Blog

Bought and Sold? Campaign Finance and the Scottish Referendum

From a campaigning perspective big donations will always be welcome, but they alone can't ensure victory. The polls have been static on independence for some time, but with 18 months to go it's still all to play for.

It's only been a few weeks since Alex Salmond announced the date of next year's Scottish independence referendum, and yet the campaign has already seen its first threatened legal action.

The controversy followed the publication of the Better Together's campaign's finances. National Collective, a radical pro independence group published a number of serious allegations against Ian Taylor, the biggest single donor to the unionist campaign, which resulted in him threatening legal action. National Collective has refused to comply with Taylor's demands and are standing by their original piece.

The majority of the press attention may have focused on the nature of the allegations and the implications of the threats, but the publication of the donor lists has raised a number of other short and long term issues for both campaigns.

Better Together's total donations amounted to £1,118,451, with £500,000 coming from Taylor. There were also a handful of other significant donations which made up the bulk of the remaining total, with crime writer CJ Sansom donating £161,000, former Inverness Caledonian Thistle FC chairman Alan Savage donating £100,000 and Douglas Flint, former chairman of HSBC Holdings, donating £25,000. A further 27 people gave between £500 and £7,500, amounting to £54,066 in total

On paper their long term funding should be reasonably secure, with the campaign claiming to have a further £1 million pledged, although it will be interesting to see if the ongoing scrutiny has any impact on these outstanding donations. How many leading businessmen will want to see their interests and careers dissected across the blogsphere and national press?

The publication of Yes Scotland's accounts may not have sparked the controversy of 'donorgate', but they also provide some reasons for concern. The problem is that the campaign may have donations amounting to £1,747,797 (£342,000 from the SNP being a 'non-cash donation') but almost two thirds of their cash total came from the same source, national lottery winners Colin and Christine Weir who donated £1,000,000.

Obviously national lottery jackpot winners with a strong view on the national debate are few and far between, so their future fundraising strategy will need to focus on broadening the campaign's donor base. The sizeable donation from the SNP was inevitable at the start of the campaign, but considering the scale of the donation, and the fact that the lottery winning couple are SNP members, it'll do little to discourage the critics who accuse Yes Scotland of being too close to the Scottish Government.

The main issue for Yes Scotland is that their small donations (those below £7500) only amount to £112,000. Not only is this less than half of the corresponding figure for Better Together (£227,451), but they also come from a smaller pool of donors (7000 compared to Better Together's 9500) and they make up a far smaller percentage of the campaign's total donations (6.4% compared to 20%). Obviously while the majority of people oppose independence it's reasonable to expect the unionist campaign to more supporters and greater funding, however in order for the pro independence campaign to succeeed it will need to turn that around between now and 2014.

One problem is that it's unclear to what extent either campaign is engaging with the undecided public, a point which only benefits the status quo. Undoubtedly both sides will have good activists, but there needs to be a distinction drawn between the work of activists and the campaigns as a whole. The 9500 contributions to Better Together sound impressive, but they have come from across the UK and beyond, not just Scotland, and to put the 7000 for Yes Scotland in perspective it is less than one third of the SNP's membership (who will have donated disproportionately), and likewise some of them have come from abroad. It may be early days but there is little evidence that either campaign is getting a significant number of donations from people who weren't already involved in party politics.

In a recent speech Yes Scotland's Chief Executive Blair Jenkins claimed that his campaign "hold more events, get bigger turnouts and have much more enthused and energised volunteers" which may well be true, but if it is then it is yet to be reflected in their donor base.

Nobody wants to see a situation in which big money can decide election results, but to a point that already happens in Westminster and Holyrood. During the 2011 Scottish Parliamentary elections the SNP spent £1,141,662 on their campaign, compared to Labour who spent £816,889 and the Conservatives who spent £273,462. It would be ridiculous to argue that if the money had been equal the SNP wouldn't have won the election, of course they would, and probably by a similar margin, but the impact of money becomes more pertinent when considering closer results. The 2007 election saw the SNP outspending their opponents by over £250,000 and winning by a solitary seat after an election that went right to the wire. Did the money make a difference? Possibly not, but you would be hard pushed to conclusively say otherwise. If the referendum is to be as closely fought as many are predicting then money could make a big difference.

There is certainly no crime in political parties and campaigns raising, and spending, large sums of money. One thing the SNP's financial advantage has allowed them to do is invest in sophisticated canvassing and market research, having spent over £200,000 on it in the 2011 election period alone. As a result their intelligence has become far stronger and has allowed them to shape and target their messages far more effectively than their opponents.

From a campaigning perspective big donations will always be welcome, but they alone can't ensure victory. The polls have been static on independence for some time, but with 18 months to go it's still all to play for. In order to get a solid advantage the campaigns will need to do what Labour did in 1997 and what the SNP did in 2011, that is increase their support base and broaden their appeal to win over the significant chunk of the electorate that is still undecided. One thing the donor lists suggest is that both sides still have work to do in that department.