In the weeks running up to the May election, the Conservatives spent pounds 20m, Labour went through pounds 13m and the Liberal Democrats spent pounds 3m on their national publicity drives. A Labour spokesman said yesterday: "This thing just spirals and spirals; the parties spend and spend and spend again. It is madness."
It is thought that if a ceiling had been imposed on national election budgets in May, it would have been based on a limit of between pounds 5m and pounds 10m, ensuring that Labour and the Tories faced each other on a level playing field.
There is also a strong suspicion at Westminster that Tony Blair is keen to end the charge that New Labour is dancing to the unions' tune because of its reliance on the unions' elections contributions. So there is party advantage in this too. Because Labour has less access to business finance than the Conservatives, it has a vested interest in introducing curbs on spending.
The introduction of proportional representation for the European parliamentary elections in 1999 is being used for the revision of electoral rules, including a ban on candidates standing on misleading labels - like ''Literal Democrat'' - as well as the cap on election spending sprees.
Mr Straw believes that current restraint on election spending is out of date, because it came into force at a time when most cash was invested in local, constituency-based efforts. That is why there are fixed limits on individual candidates' spending.
"We did not have the mass media, even the poster signs that we now have," Mr Straw had told the Commons Home Affairs Select Committee. "There was less use made of the media that existed. There is a need to modernise our approach to election spending."
The Government is already committed to enacting legislation obliging parties to declare the source of all donations above a minimum figure of about pounds 5,000, along with a ban on foreign funding.
But in a memorandum to the select committee, Mr Straw now says: "If a regional list system is to be introduced for elections to the European Parliament, there will need to be new rules governing electoral expenditure, since the emphasis will be much more on the promotion of parties rather than individual candidates.
"Any examination of the rules governing election expenses could also cover the possibility of imposing limits on expenditure at the national level by political parties."
Lord Holme, the Liberal Democrats' election campaign manager, told The Independent at his party's conference in Eastbourne yesterday: "We shouldn't say that everyone has to be as poor as us. But the amounts that were spent this year come as close as you can get to buying votes."
The big expense in national propaganda campaigns is for posters put up on advertising hoardings across the country, with additional money going on newspaper advertising, and seductive election broadcasts.
Mr Straw also says in his memorandum that proportional representation for the European parliamentary elections, the Scottish Parliament and the Welsh Assembly, will require the registration of political parties, because the system to be used requires parties to offer electors lists of approved candidates. He plans to use the registration process to filter out spurious parties designed to deceive and mislead the voters.
All parties - and many voters - have suffered from the activities of such candidates. In the 1994 European elections, Adrian Saunders, now Liberal Democrat for Torbay, was defeated by 700 votes after a candidate put himself forward as a Literal Democrat in Devon & Plymouth East. A legal challenge by the Liberal Democrats was rejected.
In Hackney South and Shoreditch, where Brian Sedgemore was defending a solid Labour majority, a New Labour candidate received 2,436 votes - an astonishing 7.2 per cent of votes cast - and many people complained after voting for him that they had been deceived.
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