Burnham withdraws support for political donation cap as unions lobby

Prime Minister Andy Burnham has withdrawn government support for amendments to the Representation of the People Bill that would cap domestic political donations. The decision reverses a position indicated in May, when Burnham suggested support for a £500,000 limit to guard against undue influence. According to government sources, the administration will not back amendments capping the amount a person or organisation can give in a single donation.

The move follows a lobbying campaign by Labour’s trade union backers, who argued that strict caps could undermine their ability to donate to the party. The GMB union wrote to 80 Labour MPs last month, warning that the amendments risked "significant unintended consequences" due to existing statutory regulations on union political expenditure. The government now prioritises other manifesto commitments, such as lowering the voting age to 16 and curbing foreign interference, while capping donations by British people living abroad at £100,000.

Stella Creasy, a Labour backbencher who tabled an amendment calling for a donations cap, has modified her proposal in response. She now proposes a £500,000 cap that would be gradually reduced until ministers intervene to set a preferred level. Creasy argued that large donations undermine democratic trust, stating that the public would not forgive the government for missing the chance to clean up Westminster.

However, ministerial support remains crucial for securing enough votes to pass the amendment. Those close to the process say capping donations is not a priority for Burnham and is not a subject over which it would be worth triggering a fight with Labour’s biggest backers. The bill returns to the Commons for its remaining stages next week, where it is expected to be one of the most contested issues of Burnham’s early tenure.

Other Labour MPs plan to use the next stage of the bill to introduce clauses banning cryptocurrency donations and addressing social media misinformation. Some also want Burnham to back their idea of a national commission on changing the voting system, a position the former Greater Manchester mayor has repeatedly supported in the past.

The withdrawal has angered activists and Labour MPs, including Rushanara Ali, who helped write the bill when she was a minister in the communities department. Ali recently described the bill as too "timid" and "incremental", urging Burnham to strengthen it with amendments. The Electoral Reform Society has also criticised the move, noting that huge donations have a corrosive effect on trust in politics.