Politics: Chasing the cash

In the past it had been an accepted fact of political life that the Conservatives would outspend Labour at general elections.

New Labour has been determined to rectify this handicap, and the fund raising mechanism had been drastically overhauled in recent years.

By the l992 election the gap had narrowed to pounds 11.2m by the Conservatives compared to pounds 10.6m by Labour.

In l996 the net income of the party was pounds 17.1m, and the expenditure pounds 17.7m. Out of that pounds 7.7m came from the unions and pounds 6.3m from fund raising, pounds 1.7m from membership subscriptions, and another pounds 1.4m from ancillary avenues such as publications. Contributions of more than pounds 5,000, including the pounds 1m given by Formula One boss Bernie Ecclestone, came from 55 donors.

In the run up to the election the director of finance, Paul Blagbrough, was officially in charge of fund raising. Others involved were head of finance David Hughes, and director of corporate relations, Nicky Lewis.

All of them reported to the general secretary Tom Sawyer. Jonathan Powell, Mr Blair's chief of staff, is also believed to have played a part in raising funds from corporate sources.

At the moment the party has an overdraft of pounds 4.5m with the Co-op bank, until the Ecclestone debacle it had hoped to repay a large portion of it by next year.

Apart from the traditional sources the party benefited from a blind trust set up for Tony Blair. By its very nature the identities of contributors to the Trust are not published.

Mr Blair's staff justified the secrecy surrounding the donors by claiming this means the party leader cannot be influenced by companies which give money.

Labour spin doctors suggested at first that Mr Ecclestone's contribution had been to the blind trust.