Government should stop funding lobbying by charities

A new discussion paper Sock Puppets: How the government lobbies itself and why has been published by the right-wing thinktank, Institute of Economic Affairs. This report argues that, when government funds charities to lobby itself, it is subverting democracy and debasing the concept of charity. It says that this is an unnecessary and wasteful use of taxpayers’ money, and by skewing the public debate and political process, genuine civil society is being cold-shouldered.

Amongst it’s key points are that:

* In the last fifteen years, state funding of charities in Britain has increased significantly while restrictions on political lobbying by charities have been relaxed. 27,000 charities are now dependent on the government for more than 75 per cent of their income and the ‘voluntary sector’ receives more money from the state than it receives in voluntary donations.
* It has been argued that state funding weakens the independence of charities, making them less inclined to criticise government policy. This paper argues that there is a deeper problem if government funds and/or creates pressure groups with the intention of creating a ‘sock puppet’ version of civil society which creates the illusion of grassroots support for new legislation. These state-funded activists engage in direct lobbying (of politicians) and indirect lobbying (of the public) using taxpayers’ money, thereby blurring the distinction between public and private action.
* State-funded charities and NGOs usually campaign for causes which do not enjoy widespread support amongst the general public (e.g. foreign aid, temperance, identity politics). They typically lobby for bigger government, higher taxes, greater regulation and the creation of new agencies to oversee and enforce new laws. In many cases, they call for increased funding for themselves and their associated departments. In public choice terms, they are ‘concentrated interests’ compelling the taxpayer to meet the costs that come from their policies being implemented, as well as the costs of the lobbying itself.

In response, the paper proposes solutions including:

* Government funding of a charity or other non-profit organisation is not used to promote the organisations’ interests in the policy sphere. Campaigning and education around such interests should be entirely privately financed.
* The government is not financing charities in such a way that there are people working within that charity whose interests might be strongly aligned with the continuation of government funding and who have an ability or incentive to campaign in favour of more government funding.
* Politicians and bureaucrats who wish to pursue unpopular - or even popular - political causes should not be able to do so by setting up a charitable or NGO-front that gives the veneer of independence.

Sock Puppets: How the government lobbies itself and why (pdf file)

IEA press release - Government should stop funding lobbying by charities

Paul Treloar - 11 June 2012 01:43 PM

* Politicians and bureaucrats who wish to pursue unpopular - or even popular - political causes should not be able to do so by setting up a charitable or NGO-front that gives the veneer of independence.

While companies and wealthy individuals should be able to do say by funding, for example, the Institute of Economic Affairs.

Picking up on your point Gareth, there’s a very good blog from Toby Blume, CEO of Urban Forum, making similar points, as well as raising some interesting questions about the funding of IEA itself.

The IEA seem to be suggesting that we leave the vulnerable, the marginalised and those who lack a voice to fend for themselves. If the public aren’t interested in supporting ex-offenders, or Gypsies, or asylum seekers or homeless people or the victims of domestic violence – all groups that traditionally struggle to secure funding – then let them suffer. It’s tough but the market has spoken.

IEA criticise charities for “…typically lobby(ing) for bigger government, higher taxes, greater regulation and the creation of new agencies to oversee and enforce new laws”. Or, you could say, for advocating in the interests of their beneficiaries…quite obviously unlike big businesses’ lobbying efforts. Can it actually be called lobbying if it isn’t reflecting the lobbyist’s interests? Or is it simply that the IEA are ideologically opposed to state intervention, taxes and regulation? That sounds remarkably politically motivated and not quite the ‘independent research institute’ the IEA’s website claims to be.  Who are they advocating for?

Sock puppets? What utter nonsense!