New party political donations revealed

Wednesday, 16 November 2005 12:00 AM

The three main political parties in Britain received more than £6.5 million in donations over the past three months, new figures reveal.

Labour received the most money between July and September with a total of £3,723,049 being donated, followed by the Conservatives with £2,361,483, and the Lib Dems who had £694,976 put into their coffers.

The Electoral Commission figures are likely to further fuel the debate about the amount donated by private individuals, as they show Labour benefited from a £2 million donation from steel magnate Lakshmi Mittal, while the Tories received £950,000 in personal donations.

Of that, £93,000 came from a new anonymous source, which has led to a leading think tank to call for a loophole which allows donors to remain anonymous behind unincorporated associations to be closed.

New Politics Network director Peter Facey said: "The intention of the Political Parties, Elections and Referendums Act 2000 was to prevent individuals from making anonymous donations, yet the loophole allowing unincorporated associations to make donations is now being stretched to breaking point.

"While the Conservatives are currently predominantly exploiting this loophole, if it isn't closed soon, other parties will almost certainly begin to follow suit."

Concerns have already been raised about the link between private donations and life peerages, and the Times reported this week that one in ten life peers created by Tony Blair since 1997 have been political donors to the party.

These include former music industry tycoon Lord Levy who is now the prime minister's special envoy to the Middle East, and Lord Drayson, who donated £1 million to the Labour party last year and is now a defence minister.

Appointments such as these, New Politics Network insists, erode public confidence in democracy.

Mr Facey added: "Mega-donations alienate the public from party politics. It doesn't help that so many major donors seem to be rewarded with honours and even membership of the House of Lords.

"A cap on individual donations is a necessary step if we are to connect people and politics and restore trust."

The Electoral Commission also criticised all three political parties for late submissions of donations, saying it was "disappointed and concerned" that they had not fully complied with financial reporting regulations.

It said it would be seeking explanations for the late reporting of payments from each party in due course.

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