Labour’s political finance plans won’t stop Musk’s millions
A new Elections Bill is a great chance to protect British democracy from dark money and hidden influence — but Labour needs to seize it
Good news: Labour is finally talking about political donations.
For months, Keir Starmer has said little about the manifesto pledge to “protect democracy by strengthening the rules around donations to political parties.” Now, Number 10 is briefing that the government is drafting plans to reform political finance, particularly to stop Elon Musk from giving $100 million to Reform UK.
Good news, right? Well, yes and no.
Sky News reports that government officials are considering restricting corporate donations based on a company’s profits or revenue. Sky’s headline concedes that the “new rules may stop Elon Musk from making unlimited donations to Reform UK.” That ‘may’ is telling.
Restricting corporate donations is a good idea. Millions in dark money from loss-making, foreign-owned firms have flowed into British politics. In reality, there’s no justification for corporate donations at all—they often serve as a front for individuals hiding behind corporate entities to avoid public scrutiny.
But there’s a big problem: the proposed reforms won’t stop big money from buying British politics or prevent foreign interference from Musk.
Musk, Trump’s “first buddy,” is a South African-born U.S. citizen who, despite selling off Tesla stock, remains among the world’s richest men. He doesn’t live in the UK and epitomises the foreign influence British democracy is supposed to be protected from.
Yet, if Musk wants to donate to Nigel Farage and Reform, Labour’s proposed tweaks will barely slow him down. They “may” put a ceiling on his donations, but he could still funnel millions.
How? Musk could donate via Tesla’s UK arm, which made over £23 million in profit last year. That’s not “unlimited” but, in British politics, it’s close. (For context, Reform raised just £280,000 in the last three months of 2024.)
He could also channel money through UK-registered family members or use other dark money routes.
As Sam Power, a political finance expert at Bristol University, put it, Labour’s changes might “close the most glaring loopholes but wouldn’t do anything to address the elite power relations that liberal democracies are built on. If you are Elon Musk, or any other billionaire, you will find a way.”
Sky also reports that Labour believes Musk will donate to Reform before the next election, and they hope to pass their Elections Bill in time to block him.
This should be a reason to go as far as possible to clean up British politics. A Reform donor I spoke to expects Musk to donate “even if Labour changes the rules like they say they will.”
Right now, breaking election law holds no fear for Musk and Farage. The maximum Electoral Commission fine is £20,000—pocket change for Musk.
But there is some actual good news.
The Elections Bill—widely expected in the next King’s Speech—is an opportunity for serious political finance reform.
First, Starmer must reverse his position and cap political donations. Currently, anyone can donate unlimited amounts, making a mockery of democracy.
Over 11,000 people responded to our recent ‘safeguarding democracy’ survey, with the vast majority backing the cross-party Committee on Standards in Public Life’s recommendation of a £10,000 cap per donor.
We also need stricter reporting requirements, including lower disclosure thresholds—which the Conservatives raised before the election—to curb dark money.
Finally, the Electoral Commission must be strengthened. Boris Johnson stripped its independence, and it needs greater investigatory powers and the ability to levy meaningful fines.
More good news: A petition for tighter political donation rules has over 140,000 signatures (huge props to Jeremy Stone for setting it up). This has triggered a parliamentary debate on March 31. You can write to your MP urging them to support reform.
You can also support Democracy for Sale. We will keep investigating how dark money and vested interests are warping British democracy.
We will keep breaking stories and making noise about how this broken system can be fixed. Before it really is too late.
I might be naive, but surely any party's greatest asset is its volunteers which provide support free of charge. After that, a maximum allowable amount of donations for each and every party should be established.
I have written to my MP about this important issue recently and the reply I received was a little disappointing but expected, as it followed the party line. I have now sent her a further email highlighting the issues as I see them and included a link to this article, which expresses my concerns perfectly.