Plaid investigated in £1m income breach
PLAID Cymru is under investigation by the Electoral Commission after failing to declare nearly £1m of income on time, we can reveal.
The party is in breach of the Political Parties, Elections and Referendums Act 2000 (PPERA) and is likely to face a financial penalty in the New Year.
Under the Act, parties are obliged to declare donations within 30 days of receiving them, but we have established that on at least 48 separate occasions between 2013 and 2018 Plaid did not comply with the legal requirement.
On April 25, 2018, the party retrospectively informed the Electoral Commission about a total of £976,562.08 that had not been declared in quarterly returns to the commission since 2013, as it should have been.
There is no suggestion that Plaid was seeking to conceal unlawful donations.
In fact, all the money at the centre of the inquiry relates to grants it received from two public sources: the House of
Commons and the Electoral Commission itself.
Some 37 of the 48 undeclared payments made to Plaid Cymru came from the House of Commons authorities in the form of so-called “Short Money”.
This is the common name given to the annual payment to opposition parties to help them with their costs.
It includes funding to assist an opposition party in carrying out its Parliamentary business, for opposition parties’ travel and associated expenses, and for the running costs of the Leader of the Opposition’s office.
“Short Money” is named after Edward Short (later Lord Glenamara), the then Leader of the House of Commons who first proposed the payments in 1974. They were intended to help opposition parties hold the governing party or parties to account, and to offset the government’s advantage in having access to Civil Service advice.
The late declared “Short Money” payments to Plaid Cymru totalled £268,083.09, and ranged from £361 to £33,346.80
The 11 late declared policy development grant payments made by the Electoral Commission to Plaid Cymru totalled £708,478.99 and varied between £7,579.11 and £113,604.75.
Section 55 of PPERA makes it clear that income from public sources is to be regarded as donations. The clause states: “Any payment out of public funds received by a registered party shall be regarded as a donation received by the party from a permissible donor.”
Section 65 of the same Act states: “A donation report shall be delivered to the Commission by the treasurer of the party in question within the period of 30 days beginning with the end of the reporting period to which it relates.”
The section goes on to state: “The treasurer of a registered party commits an offence if he fails to comply with the requirements in relation to a donation report.”
A Plaid Cymru source said: “This is very embarrassing for the party and should not have happened.
“It seems that quarterly donation returns were being provided by the party to the Electoral Commission before 2013, but they then suddenly stopped. Party members and others will wonder how it was possible for mistakes to be made repeatedly over a period of five years without being spotted.
“The law is very clear about the responsibility to report donations, even when they are in the form of grants from public funds.
“It’s all about making sure political parties are transparent about their sources of funding.
“Plaid Cymru should learn lessons from this, and ensure something like this never happens again.
“Officials of the party are concerned about the level of fine that could be imposed in advance of the 2021 Senedd election, at which the party aims to be elected to government in place of Labour.”
A spokeswoman for the Electoral Commission said: “We are currently in the process of carrying out an investigation involving Plaid Cymru. As this is an ongoing piece of work, no further detail will be provided at this stage but we will publish our conclusions in full once it is complete.”
A Plaid Cymru spokesman said; “The investigation by the Electoral Commission is historic in nature and has been fully reported by the party in its annual reports.”
“Plaid Cymru is co-operating fully with the Commission.”
The party’s most recent accounts for the 12 months to the end of December 2018 state: “Following an Electoral Commission routine audit held on May 9, 2018 it has been identified that there has been an administrative error relating to the quarterly reporting.
“The error represents an omission of detail in respect of expenditure reported to the Electoral Commission against the development grant.
“In relation to the Electoral Commission investigation into Short monies, the investigation was cleared with no financial penalty – the party’s position remains under review with the Electoral Commission.
“The party has now corrected the position but a regulatory fine may be levied for the administrative error – the amount of the penalty has not yet been quantified by the Electoral Commission and consequently no provision has been made in these financial statements for the penalty as the party officers are unable to make a reliable estimate of the quantum.”