What does the Zac Goldsmith case mean for election expense controls in future?

It’s always tempting to view the verdict of investigations through a partisan filter – if ‘your side’ does not get punished, it’s a great result by a wise team of investigators; if on the other hand it does get punished, it’s a muddle-headed verdict from dangerously ignorant investigators, whether that means the police, the courts or a regulator.

However, the case of Conservative MP Zac Goldsmith’s election expenses raises important issues which deserve a more careful consideration than the immediate partisan filter. Some are longer-term ones about how regulation of election expenditure is changing as the methods people use alter; others are short-term ones relevant to agents of all parties who need to know what, if anything, the verdict means they could or should do differently the next time they fill in an election expense return form and put their signature at the bottom of it.

The Electoral Commission has investigated the general election expense returns from Zac Goldsmith and decided not to refer the matter to the police. The Commission concluded that there is good evidence to believe his campaign “may” have broken the election expense limits, but decided that it was not appropriate in this case to refer matters on to the police.

Therefore, it would be wrong for future agents or candidates to think, “If I do all the things Zac Goldsmith’s campaign did, that’s all ok as it would be within the rules” – that is not what the Commission concluded.

However, in reaching its decisions the Electoral Commission did express its own views on how some parts of the law should be interpreted. These views do not have the same force as legal precedence in a court case, but arguing that you followed the rules because you followed the Commission’s advice is a very strong defence – both in arguing that you did not break the rules and also (as a fall back) in arguing that even if someone takes a different view, it would not be in the public interest to prosecute you for following the Electoral Commission’s advice. On that basis, agents in future can take the following approaches.

Apportioning costs for reusable items

The Electoral Commission stated that it is acceptable for posters containing a candidate’s name to have only some of the costs apportioned against the current election on the basis that the candidate may re-stand in future and reuse the posters. A 50% allocation (implying one re-use) was seen as justifiable. This would not apply in the case of posters clearly linked to a specific polling day.

If a poster is split between more than one expense return for the same polling day, e.g. between local council and Westminster limits, then the split must reflect the relative prominence of the different content on the poster. (On this basis the Commission said it would have been “more appropriate” for the Goldsmith campaign to allocate its poster costs differently.)

How to split costs of multi-purpose leaflets

Where more than one election is happening at the same time, it is common for election leaflets to mention them and therefore for the costs to be split between the different limits. How such splitting of costs should be made has not been thoroughly tested in the courts, but it is common practice to make the split based on relative surface area – and this approach is also the one the Electoral Commission took, looking at “how much space was devoted to information about the council election candidates”.

Undelivered leaflets do not have to be counted against expense returns

Views and common practice on this point have varied across parties and over time, though no-one objected to cases such as Labour having to bin large numbers of leaflets following the tragic death of then leader John Smith in 1994. The Electoral Commission stressed in its verdict that, “The guidance issued by the Commission states that candidates and agents must include the value of everything used in the regulated period, not what is purchased”.

Renting and purchasing assets from the local party

The Electoral Commission took a broad view on what is acceptable for a local party to purchase and then rent at a fraction of that cost to campaign. Therefore it saw no problem with the local party buying electric trikes and then renting them to the campaign at a low daily cost nor with it buying jackets and then selling them to volunteers who wore them during the campaign with no jacket costs therefore counted against the expense limits.

Wider issues

Each of these individual verdicts have considerable merit and add up to useful guidance for agents in future. However, the Commission found respects in which the rules were likely not followed in its view:

This would have resulted in an overspend of £966 against the limit for the ‘short campaign period’. When looking at the amount spent over the whole campaign period (i.e. an aggregation of the ‘long’ and ‘short’ periods), even taking the potential under-reporting in the short period into account, the total expenditure remains below £35,000. This was within the aggregated limit of £39,856 for both periods.

As I said shortly after the ruling,

What is disturbing about this logic is that it implies that in future a campaign could under-spend during the long campaign and so have a defence against over-spending in the short campaign. However, the evidence about when people make up their minds to vote is that it mostly happens either before any of the campaigns start, or just before polling day. Therefore shifting expense from the long to the short campaign would confer an electoral benefit, and undermines one of the reasons for having separate long and short campaign periods.

As this was not the only reason the Commission gave for ending the case at this point, it would be foolish as well as unethical for future candidates to deliberately set out to use this defence. But it is a worrying sign about the attitude the Electoral Commission may take in future cases.

Add to this the more general change in the way in which different limits are being used by all parties:

We now have a long and short campaign period in which limits apply to constituency candidate election expenditure and those limits are relatively low. However, the national limits which also apply during that time are much more generous and there is no restriction on a party using its national limit in a very geographically concentrated way.

Therefore, a candidate in a marginal seat can do lots of extra campaigning beyond the constituency limit as long as it is of a form that can be charged against the party’s national limit.

What does this mean in practice? Well, for example it means that instead of a candidate writing a letter to local residents, candidates get their party leader to write to their residents instead.

Change who the letter is from and bingo, it no longer counts against the local limit – even if it still names the constituency and even if it urges people to vote for that candidate’s party.

The net result is that the rules are encouraging all parties to nationalise their election campaigns far more, talking less about local candidates and more about national leaders.

Of course, many voters were and will be interested to hear your views and those of other party leaders. But the overall encouragement the rules provide to nationalise campaigns, taking the emphasis away from the attributes of local candidates and further encouraging the presidentialisation of our politics, runs quite against what we should be doing to improve the health of our democracy. Moreover, the widespread ability to charge campaigning against the national limit greatly undermines the power and the point of the constituency limits.

We should be seeking greater focus on whether or not individuals, particularly incumbent MPs, are doing or would do a good job. As you said, we should also be tackling the influence of big money on elections.

Yet what is happening with election expenses is doing the opposite. Regrettably, my predictions from before the 2010 general election have turned out to be right: amongst all parties we saw a shift towards ‘national’ campaigning. It’s legal, it’s what Parliament explicitly decided (because proposals to avoid this from David Heath MP were not adapted) but it is still something we should seek to change.

The overall result is that the system of constituency expense controls is being seriously eroded – by generous views of the Electoral Commission allowing limits to be offset against each other in a way that Parliament never expressed any intention to permit, and also by the offsetting which Parliament did decide to permit.

That is why reform is needed.

UPDATE: Reform is needed all the more one Parliamentary cycle on as I wrote about in Constituency expense limits are dying off in the UK, but neither politicians nor the regulator will act.