Labour worried by Clegg's plan to cap party donations

 

Nick Clegg is to try to break the deadlock between the Conservatives and Labour over how Britain's political parties are funded.

The Deputy Prime Minister, who is responsible for reforming the political system, is considering ideas including a £50,000 cap on individual donations to parties so they do not rely on rich backers. In return, parties could qualify for tax relief on small donations in the same way as charities.

Although the Liberal Democrats have traditionally supported handing more taxpayers' money to parties, Mr Clegg is wary of proposing a huge rise in state funding while the Government is imposing big spending cuts.

Labour is nervous about his planned reforms. It suspects Mr Clegg is in cahoots with the Tories to produce reforms that harm Labour by including its trade-union donations in any cap. "That could bankrupt us," one Labour source said. Allies of Mr Clegg insist he wants to reach an all-party consensus. However, they do not rule out legislation if no deal can be reached. "This is not a stitch-up, it is a serious attempt at reform. But Labour cannot have a veto," one said.

Mr Clegg said it is unhealthy for Labour to rely largely on trade-union donations and taxpayers' grants to opposition parties. The Liberal Democrats lost their opposition money when they entered the Coalition last year and their officials are keen to see a new settlement on funding.

The Government's proposals will be finalised after an independent inquiry into political funding reports in October. The Committee on Standards in Public Life, chaired by Sir Christopher Kelly, will draw up its report next month. It is considering a cap on donations, with parties compensated by tax relief or matching state funds for small donations.

In evidence to the committee, the Tories and Liberal Democrats backed a £50,000 ceiling on donations, while Labour floated the idea of a much lower £500 cap.

Recent attempts to reform funding stalled after failing to resolve the big question of Labour's union links. The Tories want their donations included in any cap, but Labour argues it should be exempt because union-affiliation fees represent small gifts by three million members who pay the political levy.

Official figures published yesterday by the Electoral Commission highlighted Labour's dependence on its union founders. Between April and June, unions contributed about £2.7m of the £3.2m received by Labour. The biggest payments were from Unite, Unison, the GMB, the shopworkers' union Usdaw and the CWU communication workers' union.

Labour received £178,234 from individuals and £124,026 from companies. Labour also benefited from opposition party grants of £1.6m.

Between April and June, the Tories received donations that totalled about £4.2m, including £2.4m from individuals and £1m from companies.

The Liberal Democrats attracted £972,954 in donations, including £261,903 from individuals and £569,329 from companies, including two venture-capital firms – Brompton Capital Ltd and C&C Alpha Group.

Travel
travel
Voices
A family sit and enjoy a quiet train journey
voicesForcing us to overhear dull phone conversations is an offensive act, says Simon Kelner
Arts and Entertainment
The cast of The Big Bang Theory in a still from the show
tvBig Bang Theory filming delayed by contract dispute over actors' pay
Sport
England celebrate a wicket for Moeen Ali
sportMoeen Ali stars with five wickets as Cook's men level India series
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
Morrissey pictured in 2013
people
Life and Style
The director of Wall-E Andrew Stanton with Angus MacLane's Lego model
gadgetsDesign made in Pixar animator’s spare time could get retail release
News
peopleGuitarist, who played with Aerosmith, Lou Reed and Alice Cooper among others, was 71
Travel
travel
News
Robyn Lawley
people
News
people
News
i100  ... he was into holy war way before it was on trend
Arts and Entertainment
High-flyer: Chris Pratt in 'Guardians of the Galaxy'
filmThe film is surprisingly witty, but could do with taking itself more seriously, says Geoffrey Macnab
News
people
Life and Style
food + drinkVegetarians enjoy food as much as anyone else, writes Susan Elkin
Life and Style
lifeDon't get caught up on climaxing
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

SAP Business Analyst - Data Migration, £75,000, Manchester

£60000 - £75000 per annum + competitive: Progressive Recruitment: Senior SAP B...

SAP Data Migration Consultant, circa £65,000, Manchester

£55000 - £75000 per annum: Progressive Recruitment: Senior SAP Data Migration ...

SAP Data Migration Consultant, circa £65,000, Manchester

£55000 - £75000 per annum: Progressive Recruitment: Senior SAP Data Migration ...

MS Dynamics NAV Developer

£45000 - £50000 per annum + Benefits: Progressive Recruitment: MS Dynamics NAV...

Day In a Page

Save the tiger: The day America’s love of backyard tigers led to a horrific bloodbath

The day America’s love of backyard tigers led to a horrific bloodbath

With only six per cent of the US population of these amazing big cats held in zoos, the Zanesville incident in 2011 was inevitable
Samuel Beckett's biographer reveals secrets of the writer's time as a French Resistance spy

How Samuel Beckett became a French Resistance spy

As this year's Samuel Beckett festival opens in Enniskillen, James Knowlson, recalls how the Irish writer risked his life for liberty and narrowly escaped capture by the Gestapo
We will remember them: relatives still honour those who fought in the Great War

We will remember them

Relatives still honour those who fought in the Great War
Star Wars Episode VII is being shot on film - and now Kodak is launching a last-ditch bid to keep celluloid alive

Kodak's last-ditch bid to keep celluloid alive

Director J J Abrams and a few digital refuseniks shoot movies on film. Simon Usborne wonders what the fuss is about
Once stilted and melodramatic, Hollywood is giving acting in video games a makeover

Acting in video games gets a makeover

David Crookes meets two of the genre's most popular voices
Could our smartphones soon be diagnosing diseases via Health Kit and Google Fit?

Could smartphones soon be diagnosing diseases?

Health Kit and Google Fit have been described as "the beginning of a health revolution"
Ryanair has turned on the 'charm offensive' but can we learn to love the cut-price carrier again?

Can we learn to love Ryanair again?

Four recent travellers give their verdicts on the carrier's improved customer service
Billionaire founder of Spanx launches range of jeans that offers

Spanx launches range of jeans

The jeans come in two styles, multiple cuts and three washes and will go on sale in the UK in October
10 best over-ear headphones

Aural pleasure: 10 best over-ear headphones

Listen to your favourite tracks with this selection, offering everything from lambskin earmuffs to stainless steel
Commonwealth Games 2014: David Millar ready to serve up gold for his beloved Scotland in the end

Commonwealth Games

David Millar ready to serve up gold for his beloved Scotland in the end
UCI Mountain Bike World Cup 2014: Downhill all the way to the top for the Atherton siblings

UCI Mountain Bike World Cup

Downhill all the way to the top for the Atherton siblings
Save the tiger: The animals bred for bones on China’s tiger farms

The animals bred for bones on China’s tiger farms

The big cats kept in captivity to perform for paying audiences and then, when dead, their bodies used to fortify wine
A former custard factory, a Midlands bog and a Leeds cemetery all included in top 50 hidden spots in the UK

A former custard factory, a Midlands bog and a Leeds cemetery

Introducing the top 50 hidden spots in Britain
Ebola epidemic: Plagued by fear

Ebola epidemic: Plagued by fear

How a disease that has claimed fewer than 2,000 victims in its history has earned a place in the darkest corner of the public's imagination
Chris Pratt: From 'Parks and Recreation' to 'Guardians of the Galaxy'

From 'Parks and Recreation' to 'Guardians of the Galaxy'

He was homeless in Hawaii when he got his big break. Now the comic actor Chris Pratt is Hollywood's new favourite action star