11/11/04 - Report to Ceann Comhairle re European elections of 11 June 2004

Election spending

Part V of the Electoral Acts sets out the basis on which expenses may be incurred on behalf of candidates and political parties at a European election. The provisions of Part V which are relevant to the supervisory role of the Standards Commission at a European election are set out below.

2.6 Definition of election expenses

Section 31(1) of the Electoral Acts, by reference to paragraph 1 of the Schedule to the Electoral Acts, provides a definition of what are election expenses. This is set out in more detail in Chapter 4 below.

Section 31(2) of the Electoral Acts provides that where a donation of property, goods or services is received free or below cost, and is used at the election during the election period, it is regarded as an election expense which must be accounted for at its full commercial price, subject to an allowance for any normal or general discount.

Paragraph 2 of the Schedule to the Electoral Acts provides a list of items which are not regarded as election expenses. These items are also set out in Chapter 4.

Section 31(3) of the Electoral Acts provides that in the case of a European election, the "election period" is from the date of the order appointing polling day up until polling day. The election period at the 2004 European election was from 7 May 2004 to 11 June 2004. The election agents of candidates and the national agents of political parties were required to account for all goods, property or services used for electoral purposes during this period.

Section 34 of the Electoral Acts provides that payment must not be made in respect of any election expense incurred at a European election if a claim for payment has not been received by the relevant agent within 45 days of the date of the election. The election expense must, however, be accounted for in the Election Expenses Statement.

Section 35 of the Electoral Acts provides for the resolution of disputes relating to claims for payment of election expenses which were received within the 45 day period.

2.7 Appointment of agents

Each political party with candidates contesting a European election is required under section 28(1) of the Electoral Acts to appoint a national agent for the purpose of incurring expenditure on the party's behalf at the election. The party must notify the Standards Commission of the name and office address of the national agent. The Standards Commission publishes details of the national agents appointed by each political party in Iris Oifigiúil.

Each candidate at the European election is required under section 28(2) of the Electoral Acts to appoint an election agent for the purpose of incurring expenditure on the candidate's behalf at the election. A candidate may act as his/her own election agent. In such circumstances, the candidate will be subject to the provisions of the legislation both as a candidate and as an election agent. The returning officer for each constituency is required under section 28(6)(b) of the Electoral Acts to notify the Standards Commission of the names and addresses of the candidates standing for election in the constituency together with details of the election agents appointed by those candidates.

Pursuant to section 28(4) of the Electoral Acts a candidate or a political party may revoke the appointment of an election agent or a national agent and, in accordance with section 28(5) of the Electoral Acts, appoint another person to act as election agent or as national agent.

In accordance with section 31(5) of the Electoral Acts, election agents and national agents may authorise (within specified financial limits) other persons to incur expenditure on their behalf at a European election. Election agents and national agents must account for expenditure incurred by such authorised persons.

2.8 Spending limits for the European election

Section 33(1)(a) of the Electoral Acts provides that the Minister for the Environment, Heritage and Local Government may make an order determining the spending limits for a European election. An order (Statutory Instrument Number 87 of 2004), setting the spending limit for the 2004 European election at €230,000 per candidate, inclusive of VAT, was made by the Minister on 3 March 2004.

In accordance with section 33(1)(b) of the Electoral Acts, a candidate of a political party may assign part, or all, of his/her expenditure limit to a political party for spending by the party's national agent. The amount assigned to the party must be agreed in writing between the party and the candidate. It should be noted that the legislation is not specific with regard to when this assignment should be made. It would be prudent and good practice to agree the amount to be assigned before any expenses are incurred in relation to the election. There is no obligation on a candidate to assign any part of the spending limit to the political party.

Under section 33(3) of the Electoral Acts the total amount available to the national agent of a political party to spend at the election is the sum of the amounts assigned by each of the party's candidates to the party. Whatever amount is assigned to the party by a candidate is not available for spending by the candidate's election agent. Total expenditure in respect of a candidate by both the candidate's election agent and the party's national agent may not exceed the spending limit applying to the candidate.

2.9 Election Expenses Statements

The national agent of a political party, the election agent of a candidate and any person incurring election expenses pursuant to section 31(7) (referred to at paragraph 2.16 below) is required under section 36 of the Electoral Acts to furnish an Election Expenses Statement to the Standards Commission. The Election Expenses Statement must be provided within 56 days after polling day at a European election.

The Election Expenses Statement must show all election expenses incurred by the agent or person at the election (including expenses incurred by "authorised persons"). It must also include details of items which were provided free or below cost as well as details of any claims which are in dispute and details of claims for payment which were not received within 45 days after polling day.

Section 31(9) of the Electoral Acts provides that a receipt, invoice or voucher must be provided for every payment of an election expense exceeding €126.97.

Section 36(2) of the Electoral Acts provides that an Election Expenses Statement must be accompanied by a Statutory Declaration stating that, to the best of the agent's knowledge and belief, the Election Expenses Statement is correct in every material respect and that all reasonable action has been taken to ensure its accuracy.

2.10 Overspending

In accordance with sections 40(b) and 43(2)(a) of the Electoral Acts an election agent will have overspent at the election if the amount of expenditure incurred by him/her exceeds the amount of the expenditure limit retained by the candidate pursuant to section 33(1)(b) of the Electoral Acts referred to in paragraph 2.8 above.

The national agent of a political party will have overspent if the total amount of expenditure incurred by him/her exceeds the total sum assigned to the party by the party's candidates pursuant to section 33(2) of the Electoral Acts referred to in paragraph 2.8 above. A national agent will also be deemed to have overspent if the amount of expenditure incurred by him/her on a particular candidate exceeds the amount assigned to the party by that candidate.

The consequences of an overspend by an election agent or a national agent at the election are :

i) it is an offence punishable by a fine of up to €1,269.74 (section 43(2)(a) and 43(5) of the Electoral Acts);

ii) a person can petition the High Court to set aside the result of the election (section 45 of the Electoral Acts);

iii) where the overspend has been incurred by the national agent of a political party the amount of the overspend may be deducted from any payment which may be due to the party from the Exchequer under the Electoral Acts (section 40(a) of the Electoral Acts);

iv) where the overspend has been incurred by the candidate's election agent the amount of the overspend may be deducted from any reimbursement of election expenses due to the candidate under section 21 of the Electoral Acts (section 40(b) of the Electoral Acts).

2.11 Offences and penalties relating to spending at a European election

Section 31(8A) provides that it is an offence by a candidate or a political party to fail to furnish to the candidate's election agent or to the national agent of the political party, as appropriate, relevant details of expenses incurred before the appointment of the agent, in sufficient time to enable the agent to carry out his or her duties. There is no penalty specified in the legislation in relation to this offence.

In addition to the above offence, the following offences and penalties are provided for in section 43 of the Electoral Acts:

- Where a person, who is not authorised to do so (including the candidate after the appointment of his/her election agent), incurs expenditure or makes a payment in relation to the election, he or she, on conviction, can be fined up to €1,269.74.

- The penalty if an election agent or national agent is found guilty of the offence of breaching the expenditure limits is a fine of up to €1,269.74.

- Payment of claims by an election agent or national agent which were received more than 45 days after polling day can result in a fine of up to €1,269.74.

- Failure to make such enquiries and maintain such records as are necessary for the purpose of furnishing an Election Expenses Statement and making a Statutory Declaration may result in a fine of up to €1,269.74.

- Failure by an election agent, a national agent or "other person" (notified to the Standards Commission in accordance with section 31(7) of the Electoral Acts) to furnish an Election Expenses Statement and Statutory Declaration to the Standards Commission by the statutory deadline can result in a fine of up to
€1,269.74 and an on-going fine of up to €126.97 per day for each day, after a conviction, on which the material is still outstanding.

- If requested to furnish to the Standards Commission supplementary information in relation to an Election Expenses Statement, failure to do so can result in a fine of up to €1,269.74.

- If an election agent, a national agent or "other person" (notified to the Standards Commission in accordance with section 31(7) of the Electoral Acts) knowingly furnishes a false or misleading Election Expenses Statement to the Standards Commission the penalty is a fine of up to €25,394.76 and/or up to 3 years imprisonment.

- Failure to furnish to the Standards Commission, within 7 days after the date of the order, a copy of a court order for the payment of a disputed claim may result in a fine of up to €1,269.74.

- The penalty for a publisher of a newspaper, etc., who is found guilty of publishing any advertisement or notice in relation to the European election, in contravention of section 31(10) of the Electoral Acts, is a fine of up to 1,269.74.

2.12 Reimbursement of election expenses

Section 21(2) of the Electoral Acts provides that the Minister for the Environment, Heritage and Local Government may make regulations providing for the reimbursement of election expenses to qualified candidates at a European election. Regulations (Statutory Instrument No. 122 of 1999) made by the Minister for the Environment and Local Government on 5 May 1999 applied in relation to the 2004 European election. These regulations provide for a reimbursement of up to
€38,092.14 (IR£30,000) to qualified candidates. In order to qualify, candidates at a European election must either:

(i) have been elected, or

(ii) if not elected, have exceeded, at any stage of the counting of votes at the election, one quarter of the quota for the constituency.

The maximum amount which may be reimbursed to a qualified candidate is the lesser of €38,092.14 or the actual expenses incurred on the candidate. Expenses incurred by a political party on a qualified candidate in his/her constituency are reckonable under section 33(5) of the Electoral Acts for the purposes of calculating the amount which may be reimbursed to the candidate.

A candidate must apply to the Standards Commission for a reimbursement of his/her election expenses. Section 21(d) of the Electoral Acts provides that the Standards Commission must certify to the Minister for Finance that a reimbursement of election expenses may be paid and must provide details to the Minister of the amount to be reimbursed.

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