Porter to pay £12m to settle council corruption scandal

Dame Shirley Porter, the central figure in the biggest local government corruption scandal of the late 20th century, has agreed to pay £12.3m to settle the court case against her, bringing to an end a decade-long legal dispute.

The former Tory leader of Westminster Council in London owed £42m, the cost of a scheme to move council tenants out of key electoral wards to secure a Tory victory in local elections 14 years ago.

Dame Shirley, now 73, who has lived in Israel since the scandal broke, claimed in 2002 that she could not pay because she had assets worth only £300,000, despite being the daughter of the founder of the Tesco supermarket chain.

But Westminster Council later succeeded in freezing £34m of the Porter family assets. Yesterday's deal, brokered by the Audit Commission, is subject to agreement by the courts in the British Virgin Islands, where the assets are held in family trusts.

Kit Malthouse, deputy leader of the council, said: "While we would have preferred that the debt be paid in full, we have had to be pragmatic and weigh in the balance the costs and risks of litigation overseas ... I believe this is a good settlement for the council."

Ken Livingstone, the Mayor of London, said: "No one believes[she] does not have the money to pay in full the debts she owes Westminster residents. And no one will understand why she should get special treatment."