Follow the money

 ‘Who funds you?’ has become a running joke on Twitter among those working for the Institute for Economic Affairs (IEA), a free market think tank. It is a question those employed by the organisation are frequently asked by pious online Left-wingers. The implication on the part of their critics is that IEA spokespeople are simply parroting the (undisclosed) interests of their donors.

In one sense, this reflects an intolerant style of argument that has become ubiquitous in recent years. Rather than engaging generously with an opposing view, the conspiratorial style seeks first to impugn an individual’s motives. ‘I believe X because I am a good person, whereas you believe Y because you are paid to believe it’.

That said, when it comes to think tanks, it does seem reasonable to ask ‘Who funds you?’ – though not in the manner of a Twitter commissar.

Representatives from organisations such as the Taxpayer’s Alliance (TPA), the Institute for Public Policy Research (IPPR), the Adam Smith Institute, Demos and the IEA regularly feature as talking heads on political discussion programmes.

In a speech to Policy Exchange in October, the Home Secretary Sajid Javid MP said the think tank “has helped us shape policy. Last year Open Democracy reported that the TPA, the pro-Brexit website Brexit Central and the IEA were holding monthly strategy meetings attended by Conservative MPs.

All of which shows that think tanks wield significant influence in the development of public policy in Britain. And just as politicians must disclose donations, and charity trustees must disclose conflicts of interest, it is legitimate to ask where think tanks get their funding.

An investigation by The Times last year reported that think tanks are earning millions of pounds from private organisations that hope to wield influence in Whitehall, and often publish reports in areas of interest to their corporate sponsors.

For example, The Times investigation reported that Demos published a paper on the costs to the NHS of untreated ADHD. The paper was funded by Shire Pharmaceuticals, which, according to newspaper, sold £1.7 billion of ADHD medicine in 2016. Similarly, Policy Network published a report on the benefits of autonomous vehicles to the European economy – commissioned by Nissan.

The think tanks featured in The Times investigation defended the independence of their publications and stressed the editorial control they exercise over them. And it would be a mistake to assume that think tanks are pushing a particular line simply because they are in the pay of shadowy donors. But soft power – as well as the way it is exercised – matters a great deal in a liberal democracy.

The ability to get a piece of research off the ground often depends on the ability to secure funding for it, and this usually means finding a wealthy sponsor to back it. In other words, you are unlikely to find a wealthy corporate sponsor if you cannot find a topic that piques the interest of a wealthy corporate sponsor. The same applies as a general rule to trade union funding for left-leaning causes: they are hardly likely to hand money over to think tanks that are advocating a more hostile environment for trade unions.

Murky sources of funding are particularly worrying where think tanks have charitable status – like the IEA and Demos – and so must have a public benefit and remain non-partisan. I am not suggesting here that British think tanks are suspending their critical faculties in order to please their corporate donors, or that they have broken any laws, but funding-driven distortions in research have the power to skew public debate. And ‘lobbying’ on behalf of individuals or small groups is not compatible with charitable status.

The IEA, one of several think tanks that refuses to routinely disclose who its donors are, has fallen foul of the Charity Commission in the past. An undercover report by Unearthed, a wing of Greenpeace, found last year that the IEA had arranged for US donors who had pledged to donate £35,000 to have a private meeting with Brexit minister Steve Baker MP. The IEA denied breaching any laws governing its charitable status.

In addition to this, in December of last year the Charity Commission ordered the IEA to remove a report from its website – Plan A+: Creating a prosperous post-Brexit UK – because it was “not sufficiently balanced and neutral”. In 2018 the Charity Commission also ordered the Legatum Institute Foundation to take down a report – Brexit Inflection Point – from its website. The commission said the report “crossed a clear line” in terms of breaching impartiality rules.

Most think tanks have a very clear agenda, however that is not the problem. In fact, those working for public-facing think tanks rarely try to disguise their ideological position. Nor is there any evidence that donors are giving money to think tanks with guarantees that future research papers will echo their own corporate interests.1

The real issue is transparency – the public should have a right to know who funds organisations that wield such influence in public life. Many think tanks are indeed financially transparent, meaning people can draw their own conclusions about their research. However, according to Transparify, which ranks them based on their financial disclosure, several high profile think tanks continue to take money from sources which they choose not to disclose.

This matters when money translates into a form of soft power. Think tanks generate reports that can alter the direction of – some might even say distort – public debate. It doesn’t necessarily invalidate a report on, say, climate change to know that those who financed it have links to the oil industry. But is reasonable that readers are informed about such links.

One of the biggest issues in public life in Britain today is trust. The public lacks trust in politicians, in institutions, and in the way the country is being run. There is also a growing sense that politicians are too close to big business. Transparency in public life is essential to reversing this trend. As part of the democratic process, ‘Who funds you?’ is a vital question.