Conservatives admit receiving loan from foreign national before election

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Indy Politics

The Conservative Party accepted a £25,000 loan from an unnamed foreign national before the election. The sum was part of £5m that the Tory party has repaid because the lenders did not want their names made public. All names will be given in private to the Electoral Commission, the party pledged yesterday.

Under electoral law, political parties are barred from accepting donations from foreign nationals, but that does not apply to loans made at commercial rates.

Francis Maude, the party chairman, confirmed yesterday on BBC 1's Politics Show that they had accepted a loan from an "utterly respectable" foreign national. "It represents a tiny proportion of the loans," he added.

He also admitted that other loans came from British citizens through offshore trusts. "That will have been the case with Labour as well," he said.

The Tories disclosed last week that they had repaid £5m to backers who loaned the money before the general election but later asked for it back, to avoid publicity. The names of 13 who are still owed money were published on Friday. Theresa May, the shadow Leader of the Commons, said that all the names would be given to the Electoral Commission.

"Obviously there are those who wish to remain confidential in a public sense, but the electoral commission will be able to come in and look at the terms of those loans and the names," she told BBC1's AM programme yesterday.

Labour has published details of £14m the party received in loans, after claims that it was selling peerages. These claims, which are under investigation by the police, have been denied by Tony Blair. The Science minister, Lord Sainsbury of Turville, has had to admit that he failed to disclose a loan. He appears to have confused the £2m donation that he had given the party with the separate £2m loan. Downing Street said an inquiry by Lord Sainsbury's personal secretary had cleared him of breaking the ministerial code. But the Scottish National Party MP, Angus MacNeil, has called for an investigation.

The Tory leader David Cameron is meeting Tony Blair tomorrow to discuss the future of party funding. London's Mayor, Ken Livingstone, suggested that the government should either increase state funds for political parties, or put a legal limit of £5m on the amount any party can spend on an election. The current limit if £25m.