Parties face cuts to election ad budgets

Spending by political parties on ads at general elections looks certain to be cut after the "cash for peerages" affair.

Labour and the Tories are expected to cut the legal campaign limit for election spending in an attempt to head off a backlash from taxpayers over the plan to increase state funding to parties to reduce their dependency on donors.

Parties are each allowed to spend up to £20 million on the election in the 12 months preceding it. David Cameron, the Conservative Party's leader, has proposed a £15 million limit for future elections.

The proposal will be considered in a review of party funding by Sir Hayden Phillips, a former top civil servant.

The Liberal Democrats also back a £15 million limit and have called for extra state funding for parties, to be funded in part by a 10 per cent cut in the Government's adspend.

Labour, Tory and Liberal Democrat officials said this week that advertising would be the most vulnerable element of their budgets if a lower limit is agreed.