In the financial year ending in March, 38 firms gave the Tories a total of pounds 605,315 - a drop of almost pounds 1.8m from the pounds 2.4m donated by 100 companies in the previous 12 months. The figures were compiled by the trade union- funded Labour Research Department (LRD).
Pro-European Tory MPs said last night that some businesspeople had been "turned off" the party because of William Hague's hardline opposition to the single currency. One of the companies which slashed its donation was Haymarket Publishing, chaired by Michael Heseltine, the prominent Europhile. His firm cut its gift from pounds 50,000 to just pounds 1,000 last year.
The LRD said the slump in donations highlighted the Tories' dependence on Michael Ashcroft, the party's treasurer and biggest donor, who has already pumped pounds 3m into the party and will give a further pounds 1m this year.
Two former treasurers said to be unhappy about the party's reliance on Mr Ashcroft cut their donations last year, according to the survey. The LRD said that Sir Graham Kirkham, chair of furniture group DFS, "has carried out his threat to withdraw financial support unless Michael Ashcroft was removed as chairman". His wife and son, however still gave money.
Lord Harris of Peckham's private investment company, which handed over pounds 224,000 in the previous year, withheld its backing in 1998, but resumed donations this year.
The Tories played down the haemorrhage of business support, saying it was a sign that companies were giving less to political parties generally. Nevertheless, the reduced or withheld donations will worry the party's leadership. In the 1980s, the party received pounds 5m a year from companies.
Four other companies which had previously given more than pounds 100,000, did not hand over any cash last year. They were shipping line P&O, building materials group Hanson, Eddie Healey's property group Stadium Developments and travel company Trailfinders.
The 38 companies which remained loyal reduced their total donations by almost 40 per cent on the previous year. The biggest cut came from cereals group Weetabix, whose cash injection dropped from pounds 274,000 to pounds 25,000. The LRD said: "The party's losses were only very partially offset by donations from four companies who either made a first-time donation or resumed giving after a break." They were property developer Castlemore Securities, electronics group Harris and Sheldon, insurance company Sun Life & Provincial and shipping firm James Fisher.
The survey also traced 10 company donations to Labour totalling pounds 139,500 in the year to December 1998. Most contributions - totalling pounds 100,000 - came from Caparo, the group headed by Lord Paul, who was made a Labour peer in 1996.
The Daily Mail and General Trust gave pounds 500 to Labour, despite the newspaper's support for the Tories. The LRD said the gift "confirmed the conversion of chair Viscount Rothermere to New Labour before his death".Reuse content