Taxpayer-funded activism declines in England, but soars regionally & in the EU says new IEA report

28 Feb 2019 09:44 AM

IEA releases the next in a series of research on use of public money to lobby government

Following on from research published between 2012 and 2014, a new report from the Institute of Economic Affairs finds that the use of public money to oppose free market policies has become less blatant in England, while remaining common occurrence in Scotland, Wales, and the European Union.

The report “Hand in Glove? A re-examination of state-funded activism” highlights evidence which suggests that campaigning with money from central government has declined in the UK. This change may have been brought on by a combination of austerity measures, new grant standards, and the creation of quangos to act on behalf of activist groups and as advocacy organisations in their own right.

But while activist groups in the UK appear to be receiving less money from Whitehall, state-funded activism is not on the decline regionally. It appears to have grown in Scotland and Wales. Despite budget cuts in recent years, local councils are still able to find money for like-minded pressure groups to support their activities.

State-funded activism continues to be endemic at the EU level. The majority of organisations mentioned in IEA research in 2013 receive more money from EU bodies now than they did in 2011, and most of them rely on the EU for the majority of their income.

Quango-style pressure groups that receive state funding, labelled ‘sock puppets’ in previous IEA research, tend to lobby for politics favoured by politicians and/or civil servants. While there have been improvements in some areas, mutual back-scratching and feather-nesting remains, notably in the green sector and nanny state sector.

With ‘civil society’ dominated by taxpayer-funded organisations, there is a risk that important stake-holders, not least ordinary consumers, are squeezed out of decision making.

Key points

State-funded activism in the UK

Activist groups appear to be receiving less money from Whitehall than they did five years ago. It is difficult to ascertain whether this is because of budget cuts or because of the new grant standards. Whatever the reason, the use of public money to oppose the free market has become less blatant in England while remaining common in Scotland, Wales and the EU.

The devolved governments of Scotland and Wales are funding campaign groups such as Alcohol Focus Scotland, Stonewall, the Scottish Fair Trade Forum, Obesity Action Scotland and Action on Smoking and Health.
Local authorities are funding campaign groups such as Balance Northeast, Sustain, Fresh, the Birmingham Food Council, Food Active and Give Up Loving Pop.

Increase in state-funding for the European Commission’s favoured ‘civil society’ organizations

Of the civil society groups that were members of the European Year of Citizen Alliance in 2013, more than 70 per cent rely on EU funding for most of their income.

The EU continues to be the major benefactor of a range of partisan political pressure groups and pro-EU think tanks, including Friends of Europe (€1,085,907, 39 per cent of income) and the Socialist Educational International (€102,233, 42 per cent of income).

The European Movement is heavily funded by the European Commission (over half its budget in 2016), as is European Alternatives (€300,000 of its €500,000 budget).
Both taxpayer-funded groups actively oppose Brexit and supported the October 2018 People’s Vote march calling for a second referendum.

Most of the big ‘green’ NGOs have seen their EU funding increase since 2011 and a multitude of like-minded groups receive grants from a €20 million EU programme.

Commenting on the report, author Christopher Snowdon, Head of Lifestyle Economics at the Institute of Economic Affairs said:

“Despite ‘austerity’, millions of pounds of taxpayers’ money continue to be used to fund political lobby groups. The problem is endemic at the EU level, and the devolved governments of Scotland and Wales are not far behind.

“Even local authorities, which have seen the biggest squeeze in their budgets, are effectively paying people to lobby the government for higher taxes and more regulation. These organisations have the right to be heard, but there is no justification for the government giving them a slush fund to amplify their voice.”

Notes to editors:

For media enquiries please contact Nerissa Chesterfield, Head of Communications: nchesterfield@iea.org.uk 020 7799 8920 or 07791 390 268

To download the IEA’s paper “Still Hand in Glove? A re-examination of state-funded activism” click here.

Author Christopher Snowdon is Head of Lifestyle Economics at the Institute of Economic Affairs.

The IEA has published several reports, also written by Christopher Snowdon, on state-funded activism, including “Sock Puppets: How the government lobbies itself, and why” (2012), “Euro Puppets: The European Commission’s remaking of civil society” (2013), and “The Sock Doctrine” (2014).

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems and seeks to provide analysis in order to improve the public understanding of economics.

The IEA is a registered educational charity and independent of all political parties.