Funding reform back on the table in effort to limit damage

 

The Conservatives mounted a rapid operation yesterday to limit the damage done by the boastful indiscretions of their chief fundraiser, Peter Cruddas.

It took only a matter of hours before the party machine had not only persuaded Mr Cruddas to resign, but had announced his replacement. He is Lord Fink, who quit only three weeks ago after three years as co-treasurer.

For the second stage of their damage limitation strategy the Conservatives are sending out feelers to the other main parties to see if they can revive talks on reforming the rules that govern the funding of political parties.

However, a spokesman was unable to say whether the two Tory negotiators – the Cabinet Office minister Francis Maude and the chairman of the party board, Andrew Feldman – would have a new offer to bring to the table.

The other parties agree that reform is needed, but Labour accuses the Conservatives of torpedoing previous talks by unreasonably insisting that wealthy individuals should be allowed to make substantial donations, of as much as £50,000 a year. The Conservatives say it was Labour's fault the talks broke down because it unreasonably insisted that union donations should be exempt from any agreed limit.

The Conservative deputy chairman, Michael Fallon, toured the broadcast studios yesterday to disown Mr Cruddas's recorded remarks, which implied that a "premier league" donor to the Tory party could buy access to political influence.

"He was blustering and he was wrong. He made a mistake. He over-boasted," Mr Fallon told Sky TV's Murnaghan programme. He insisted that even if Mr Cruddas had struck a deal with a genuine donor along the lines of the offer he was recorded making to undercover reporters, it would have been blocked by "the normal compliance check".

He described Mr Cruddas as someone who had been in the post for only a short time and had "very little understanding of the policy process".

Others reinforced the claim that Mr Cruddas was a newcomer. One Tory MP, speaking anonymously to The Independent, said: "I sat on the Board with [the former party treasurer] Michael Spencer and I've never heard of him."

But a Labour spokesman said: "This is not about some rogue supporter. This goes to the heart of David Cameron's operation. It's about his private dinners, his conduct, his party."

Mr Cruddas was appointed co-treasurer of the party in June 2011, but for nine months he was working alongside the more politically experienced Lord Fink. There was obvious relief from some Tories yesterday at the return of Lord Fink, a hedge fund manager who has given millions to the party.

Tory website offers price list for what donations buy

The Conservatives make no bones about the fact that you can buy access to their leaders if you are generous enough. There is even a price list on the party's website.

For £2,000: "A lively programme of drinks receptions, dinner and discussion groups."

For £2,500: "Discussions with leading industrialists, parliamentarians and City figures."

For £5,000: "Meet and debate with MPs at a series of political lunches and receptions."

For £10,000: "Dinner and political debate with eminent speakers from business and politics."

For £25,000: "Join senior figures from the Party at dinner, lunches, drinks receptions, election result events and important campaign lunches."

For £50,000: "Join David Cameron and other senior figures at dinners, post-PMQ lunches, drinks receptions, election result events and important campaign lunches."

The Liberal Democrats also have a scale of charges – £1,000, buys an invitation to Nick Clegg's reception at the party conference and "regular social events". Those paying £25,000 are promised "a regular programme of exclusive dinners and debates".

POLITICAL FUNDING THE BIG DONORS – AND THE REFORMS EACH PARTY WANTS

Conservatives

Main backers: The Conservatives have several mega-rich backers who have given more than £1m, which usually qualifies them for a seat in the House of Lords and a position in the party. They include Lord Ashcroft, who may have given more than £10m, half of it since David Cameron became leader, hedge fund managers Michael Farmer and Lord Fink, Lord Edmiston, a car salesman, and the financier, David Rowland. Peter Cruddas has given more than £700,000

View on reform: The Tories propose a cap of £50,000 a year to apply equally on individual, corporate or union donations, plus a limit on general election spending.

Labour

Main backers: Under Tony Blair, the Labour Party attracted a number of million pound-plus donors, the most generous being Lord Sainsbury, who gave more than £13m. One of the first was the Formula One boss Bernie Ecclestone, whose money had to be given back. Since the election, Labour's only major donors have been the big unions Unite, which gave £1.5m just in the third quarter of 2011, Unison which gave over £1.1m in the second half of 2011, and the GMB which gave over £980k in the same half-year.

View on reform: Labour would settle for a lower cap on individual donations such as the £10,000-a-year cap proposed by Sir Christopher Kelly, the former standards watchdog, but argue that the funds they get from unions are the sum of individual donations and should be subject to an across-the board cap. They say state funding is "not a priority" in the current economic climate.

Liberal Democrats

Main backers: The Lib Dems had a millionaire backer once, in Michael Brown, who gave £2.4m before the 2005 election but was later exposed as a fraudster. The only really substantial donor now is the family trust set up by the founders of the Methuen publishing firm, which gave nearly £910,000 in the second half of 2011.

View on reform: The Liberal Democrats support caps on donations and election spending, and believe that state funding is the eventual solution, though difficult to defend during a recession.

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