Politics: Labour wants funding inquiry to be widened

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Sir Patrick Neill's inquiry into political funding should cover commercial sponsorship of party events, Labour said last night, after MPs complained of firms "trying to buy favours" without actually giving cash. Fran Abrams looks at the growing list of firms prepared to hand out canapes to politicians.

On the Sunday morning of Labour's annual conference, delegates were treated to a free breakfast at one of Brighton's Grand Hotel. Gordon Brown provided the words of welcome and an arms manufacturer provided the croissants.

The Welfare-to-Work breakfast, paid for by British Aerospace, was just one of a growing number of party events with the mark of a commercial organisation on them. Everything from wallets containing conference agendas to stairs in the conference centre can attract sponsorship.

Paul Flynn, Labour MP for Newport West, complained about the phenomenon at a Parliamentary Labour Party meeting last week. He has called for a full review of links with private companies.

"Granny Farms Incorporated and Crud Swallowers PLC have not suddenly been converted to the merits of fair pensions or the minimum wage," he said yesterday. "They are financing the Labour Party in order to buy favours from Government." Despite raising the issue before, he had received little encouragement from party officials.

In answer to a letter from Mr Flynn the party's finance director, Paul Blagbrough, insisted that the sponsorship arrangements were based on advice from Sir Gordon Downey, Parliamentary Commissioner for Standards. They did not give "preferred access" to ministers and there was no need for a review, he said.

Last night, though, the party said it believed sponsorship should be included in Sir Patrick's inquiry. "We feel it's an area that will have to be looked at," a spokeswoman said. "We will make our contribution to the inquiry and await guidance from it when he concludes."

At this year's conference, long-term sponsors were joined by newer names. The Co-operative Wholesale Society, a traditional backer, paid pounds 14,000 for plastic document wallets with its name on and a leaflet inside about its activities. Granada Television, which visits all the conferences, hosted a reception for North-west delegates and was delighted to win a few warm words from Tony Blair.

Other backers provoked more disquiet, though. Some delegates complained about the link-up with British Aerospace, which sells Hawk jets to Indonesia. Last year there was similar comment after another arms manufacturer, Racal Electronics, bought space on each step of the conference centre staircase.

British Gas bought a table at a fund-raising dinner last year and visits all the conferences, while Mirror Group Newspapers, part owner of The Independent, regularly pays for a disco at Labour's gathering. A drugs company, Novartis, recently paid for an induction conference for new Labour MPs.

Others that have paid for drinks and canapes include Eastern Group, an electricity company, and the North and Mid Cheshire Training and Enterprise Council. Chris Blythe, chief executive of the council, which spent pounds 4,500 on sponsoring a regional delegates' event in Brighton, said he felt the money was well spent.

Last night the row over tobacco sponsorship of Formula One rumbled on as it was announced that the Public Health Minister, Tessa Jowell, would be called to explain the sport's exemption from a proposed ban to a Commons committee on European legislation.

Representatives of darts and other sports affected by tobacco sponsorship are to meet the Prime Minister after a promise by Peter Mandelson to the Tories' industry spokesman, John Redwood, in a television interview on Sunday. Darts representatives say that like Formula One their sport holds global events in Britain and is entirely dependent on tobacco sponsorship.