Kebabing Labour's dodgy donors

Dave Statham, Brent East CLP, does not buy New Labour claims on corporate funding.

The Labour Party used to be funded by Party members and democratically-accountable union political funds, but this is fast-changing. Whereas back in 1986, 76% of Party income came from unions, by 1997 this was down to 30%. Meanwhile the proportion raised from donations of over £1,000 and "events and sponsorship" rose to the same 30%.

These changes encompass many worrying elements. Apart from the dilution of the trade union link inherent in the change and the absence of any democratic element in the company donations, the question of who is buying what looms large.

The 1997 Annual Report listed donations of over £5,000 - but only identified the donors without saying how much they gave, beyond the fact that it was more than £5,000. Unfortunately for the denizens of Millbank, companies are required to divulge political donations in their accounts; work done by the Labour Research Department reveals that large donors included:

• investment advisers GLC who gave £30,000 in the year to June 1997
• sheet metal group Caledonian Mining gave £20,000
• insurance company Sun Life & Provincial gave £15,000
• The largest donation came from the Political Animal Lobby who gave £1,052,000 - unfortunately for them the Government caved in to the hunting lobby and failed to back Mike Foster's bill
• The next largest donation was from Lord Paul's Caparo group which gave £76,000
• Creation Records with £24,838
• £5,000 each from Ranger Oil (UK) and Somers Handling.

Several of the other corporate donors have yet to file accounts for the relevant period so information is not yet available; for more details of the Labour Research Department visit their website at www.lrd.org.uk.

The donations of individuals such as Alan Sugar of electronics group Amstrad or Lord Hollick of United News and Media are more difficult to quantify as there is no requirement for them to divulge the details. But an interesting example of an individual donor is Lord Sainsbury of Turville, who was given his peerage by Blair and has since stood down as chair of the supermarket chain to become Minister for Science.

Sainsbury's figure in the list of sponsors of Party events along with Safeways and Tesco. Presumably Somerfield will figure in the 1998 Annual Report after the infamous Conference "tags". Another item to ponder is the £7,000 donation to the Labour Party Front Bench Research Fund from Mirror Group Newspapers in 1997. A recent revelation that Peter Gabriel and Jeremy Irons, who both feature in the over £5,000 list, have got contracts connected with the millennium dome raises shades of Mandygate. No firm figures are available on either the size of their donations beyond "over £5,000" or the value of the contracts although theses are said to be "five-figure" for Gabriel and "four-figure" for Irons.

While the dodgy donations received so far are within the law this may change if the report of the Neill Committee is implemented. The Committee's main proposals include full public disclosure of donations (including sponsorship and benefits in kind) of £5,000 or more at national level and £1,000 to constituencies, an end to blind trusts, a ban on anonymous donations over £50 and on foreign donations except from registered UK voters overseas, shareholder consent for company political donations and party accounts to be publicly available.

Many feel that the proposals do not go far enough. For instance current company law requires that any donation over £200 be declared in the company accounts. Why not apply this £200 limit to both corporate and individual donations? This would get round the problem of individuals making lots of small donations to avoid disclosure. Also why should company shareholders be the only ones to have a say - why should those who create the wealth not have a say? If workforces were balloted on whether or not political donations should be made from the fruits of their labours we might see some very different results!

The reference to sponsorship and benefits in kind is worthy of note; remember politicians whizzing round the country in helicopters? Anyone who thinks the cost of said chopper was disclosed in election expenses can't be a regular LLB reader.

The question of the buying of peerages is an area which the Neill Committee has not so far investigated, but it might be worthy of some examination. Under the Tories the link between company donations and peerages was striking and while no such pattern has yet emerged under New Labour it must be watched closely.

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