Political funds





A union can only spend resources on political activities if it has a political fund. Section 72, TULRCA lists the political activities that can only be carried out by a union if they use the fund. They include:


• donations to political parties or providing facilities and funding conferences; and




• producing or distributing literature, documents, films or adverts designed to persuade people to vote (or not) for a particular candidate.




To establish a political fund, unions must secure member support through a postal ballot which must be renewed every 10 years (Chapter VI, TULRCA). The CO hears member complaints about the political fund. Any member has always been free to opt out of making contributions to the political fund.




New restrictions on the political fund became law on 1 March 2018 (section 11, TUA 16, section 84. TULRCA). As a result of these changes, it is now unlawful to require new members to contribute to the political fund unless they have given prior notice of their willingness to contribute by submitting an opt-in notice. 



Here are the key features of the new political fund regime:


• the old rules (pre-TUA 16) continue to apply to any member who joined a union with an existing political fund before 1 March 2018. They have (as they have always had) the right to opt out of the political fund at any time;




• where a union already has a political fund, all new members who join the union after 1 March 2018 must “opt in” to the political fund in order for them to make contributions to it. It is against the law for unions to require new members to contribute to the political fund unless they have submitted an “opt in” notice. Members can withdraw their “opt-in” notice at any time, by giving one month’s notice;




• opt-in and opt-out notices must be in writing but members can use email or online forms provided by the union;




• unions with political funds must spell out on membership forms that members can choose whether to opt in and will not suffer any detriment if they decide not to;




• unions must remind new members annually of their right to opt-out of the political fund. In practice, unions are likely to inform everyone, rather than just new members, for example, using newsletters or the annual financial statement to members. Members must be notified of this right within eight weeks of the Annual Return to the CO;




• unions must send the CO a copy of this notification;




• union rule books must have been changed to reflect the new regime, with the changes must be approved by the CO; and




• where a union decides to have a political fund for the first time after 1 March 2018, all members, existing and new, must opt in before making contributions.




These were highly partisan changes, designed to attack Labour Party funding. Their serious constitutional implications were recognised by the House of Lords who appointed a cross-party select committee to investigate their impact on party political funding. These interventions resulted in some modification of the original proposals, but the broad proposals were implemented with no corresponding limit on individual or corporate donations to political parties by wealthy donors. 



Other restrictions on union political campaigning are found in the Lobbying Act 2014. These changes significantly limit unions’ power to campaign during elections. There has always been a cap on election spending by third parties including unions, but the Lobbying Act effectively cut the maximum spending cap on election campaigning by third parties in the run up to a general election by around 60%, as well as introducing a chilling lack of clarity as to what is permissible. Breach of the Lobbying Act is a criminal offence.



In addition, any union must register with the Electoral Commission if it intends to spend more than £20,000 in England (£10,000 in Scotland, Wales or Northern Ireland), and must account in detail for its spending to the Commission.