Labour accused of misusing £2m

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The Independent Online

Political Correspondent

Labour is to investigate allegations that up to £2m of taxpayers' money was used to buy the support of party members to secure a safe parliamentary seat in Birmingham.

The claims relate to the distribution of housing renovation grants in inner-city wards, but the immediate focus of the inquiry is expected to be the Sparkbrook seat held by Labour's former deputy leader Roy Hattersley, who is stepping down at the next election.

Rival party factions have been exploiting the 1989 Local Government and Housing Act to help residents in their areas to leapfrog more than 9,000 residents on the waiting list for grant applications to be approved. Many of the queue-jumpers are Labour members.

The area of most concern is Small Heath ward, part of theconstituency of the same name currently represented by Roger Godsiff. Because of boundary changes, the constituency will disappear at the next election and the Small Heath ward will became part of Sparkbrook.

Tom Sawyer, Labour's general secretary, said: "There are very serious allegations and I will be initiating an immediate inquiry. I have no intention of allowing misconduct of any individual members of the party to harm the reputation of Birmingham council or the Birmingham Labour Party."

The investigation has the backing of Theresa Stewart, the leader of Birmingham City Council, who also pledged to call in the district auditor.

Jeff Rooker, Labour MP for Birmingham Perry Barr, has called for a police investigation into a possible breach of local government corruption laws. The affair will draw comparisons with vote-rigging allegations against Dame Shirley Porter and other Westminster councillors who the district auditor, John Magill, said had misused £21m of public money on the "homes- for-votes" scheme.

But a Sparkbrook constituency source yesterday questioned whether there had been any illegality, saying that while Birmingham City Council's queuing system for grants was intended to match heavy demand for a limited supply of resources, unlike the Act it had no legal standing.