Thanks for your donation!Last week our friend Andrew Smith did a guest post about the problem of party funding at Holyrood, specifically citing the proportion of the SNP’s funding which comes from Brian Souter. Egregious donors to the larger parties abound, though, and Soutar is just the closest example to home.

Take Michael Brown, who handed the Lib Dems £2.4m he’d acquired through fraud. Last year he started a seven year sentence after being captured in the Dominican Republic: the stolen assets, which the Lib Dems received, have never been returned.

Labour’s examples are less shocking, perhaps – well, almost all the other examples are less shocking – but they’re substantial too. David Abrahams used “three employees as fronts to fund the Labour party nearly £600,000“. Bernie Ecclestone handed over (then withdrew) a £1m donation amidst accusations that the money was tied to an exemption for his pet business, Formula One.

The Tories, well, it’s harder to tell with the Tories, given how central to their purpose it is to skew the rules in favour of big business at our expense. Their policy really does seem to be for sale to the highest bidder.

However, political parties have to be funded. Capping donations and just taking smaller donations from members is one route, but it also limits parties and doesn’t give them an incentive to appeal beyond their base.

At the end of Andrew’s piece he says he doesn’t think anyone is considering public funding, and that he’d opt out if it might fund UKIP (a position he comes back from a bit in the comments).

So what might the alternative be? Why not consider it a tax rebate instead, and add a second form below the existing ballot paper which gives people the opportunity to allocate a pound from their taxes to the party they voted for, or indeed to any other party standing? Or to opt out and have that pound stay with the Treasury if they prefer?

Andrew Rawnsley argued yesterday that the parties would have to become mass organisations again, which is admirable but sounds a bit optimistic. Might this rebate idea not be one small way to rebuild connections (in both directions) between the wider non-joining public and the parties? Might the public feel a bit more invested, and the parties feel a bit more pressure to appeal beyond their base?

The cost would be minimal – even if no-one opted out, the “rebate” from Holyrood 2011 would amount to less than £2m – the turnout was 1,991,051. For a comparison (assuming a final cost of £1.6bn and a road distance of 6.7km), the total cost of this entire scheme for Scotland would be less than the price of ten metres of the unnecessary additional Forth Road Bridge. Yes: the bridge and its roads will cost more than a quarter of a million pounds per metre. Sorry to get sidetracked.

And this kind of sum would be on a convenient scale to fund an election campaign. Take the 2010 UK General Election. 29,687,604 votes cast: £31.5m spent (see 2.3 of the Electoral Commission’s report). Sure, some people would give their “rebate” to parties you or I might find unpleasant, but unpleasant people fund unpleasant parties already, and typically with much larger sums.

Alongside a £5000 cap on donations, this would turn politics over to the public, or at least the electorate (if you don’t vote, your “rebate” goes back to the Treasury, sorry). In a marginal seat where someone’s voting tactically, perhaps they’d donate their £1 to the party they’d really like to see win, and that way that party would be marginally more likely to win next time. It’s no substitute for proportional representation, but it might help ameliorate some of the worst winner-takes-all effects of the current system. Power to the people!