Minister pledges action on 'mega-donors' as Labour resists immediate cap on political giving

The government has announced a cross-departmental task force to examine curbs on "mega-donors" in British politics, but ministers resisted immediate pressure to impose a cap on UK-based donations amid accusations of partisanship from Reform UK. Florence Eshalomi, the communities minister, told the Commons that the prime minister was "determined to tackle the UK-based issue of mega-donors" and that the new team would "work at pace to find a solution without unintended consequences".

The commitment came as MPs debated the Representation of the People Bill, which already contains a £100,000 annual cap on donations from British citizens living overseas. Labour MP Stella Creasy led calls to go further, tabling amendments that would impose an immediate £500,000 limit on UK-based donors, reducing to £100,000 in the second calendar year, with ministers empowered to set a permanent cap. Her proposals, signed by more than 60 MPs, would have exempted trade unions, which she described as "already well regulated" and a source of "clean money".

Creasy told the House that "obscene wealth is increasingly dictating who is heard, whether we like it or not, what issues are being prioritised and whose interests shape policy decisions". She pointed to a surge in donations of £1m or more over the past decade, naming among others the British billionaire Christopher Harborne, a Thailand-based businessman who is one of Reform's biggest backers. Last year Harborne gave a single donation of £9m to Reform—the largest single gift to a UK political party by a living person. There are currently no restrictions on the amount of money UK-based donors can give to parties or politicians.

Reform UK's Danny Kruger condemned the bill as a "flagrantly partisan attempt to kneecap" his party. The MP for East Wiltshire, a former Conservative, highlighted the millions of pounds donated by trade unions to Labour and accused the government of seeking to "restore trust in the class of politicians and in the political parties that have got us into the mess that we are in". He said: "The claim is made that this bill will defend democracy, but actually it's a flagrantly partisan attempt to kneecap Reform UK."

Eshalomi defended the bill, saying it "already contains a package of significant measures designed to strengthen the political finance regime whilst ensuring that legitimate donors can continue to fund election campaigns". She said the new task force would find a solution without unintended consequences, adding: "I can reassure members that once these solutions have been found, we would want them in force as soon as possible." Full details of the team's remit have yet to be confirmed.

The Liberal Democrats proposed establishing a royal commission to recommend a cap on donations and examine the effectiveness of existing campaign expenditure limits. The proposal was rejected by 427 votes to 85. Green MP Ellie Chowns backed Creasy's case for a cap but suggested a lower limit of £50,000 a year. Conservative shadow housing secretary Katie Lam said protecting UK democracy from foreign influence was a "noble aim", but cautioned that government changes had not always been produced with "proper care and attention".

In March, the government announced it would ban cryptocurrency donations and cap overseas British citizens' gifts at £100,000 annually. Ministers later said overseas voters moving to the UK would be prevented from donating more than £100,000 for a year after their arrival, and announced tougher checks on company donations. The bill also extends the right to vote to 16- and 17-year-olds. MPs approved the bill at third reading by 411 votes to 102, majority 309, and it will now undergo further scrutiny in the House of Lords.