Funding of Political Parties (Hansard, 16 June 1993)

§ Mr. John Spellar (Warley, West)
I beg to move, That leave be given to bring in a Bill to regulate the funding of political parties, and for connected purposes. Let me make it clear that it is not about state funding for political parties; it is principally about regulating outside donations.
The Bill has three main aims: first, to prohibit donations by foreign nationals not normally resident in this country, and by overseas companies and overseas Governments; secondly, to ensure the recording and publication of donations above a certain limit, probably about £1,000; thirdly, to require political parties to publish income and expenditure accounts, in the same way as companies and trade unions do.
I am sure that such measures would be welcomed, not only by the Opposition but by many Conservatives, particularly those who support the Charter movement and who are demanding openness in their own party. I hope that the chairman of the Conservative party will be able to enlighten the Home Affairs Committee about many of these matters later today.
The House passed a resolution as far back as December 1949 that political parties, and all other organisations having political action as one of their aims, should publish annually full and adequate statements of their accounts. Perhaps 40 years is enough time for even the Tory party to catch up.
Why is party funding, particularly funding of the Conservative party, such a relevant issue today? After all, the brewers have been involved in Tory politics for centuries; even today their influence is fairly substantial. Various shadowy organisations, such as British United Industrialists, have been funnelling money into Tory coffers for years. It is nearly 50 years since the so-called River companies were set up as a secret conduit for funds for the Tory party which it wanted to keep hidden from public gaze.
It has also been clear for many years, to put it delicately, that there has been a strong statistical link between donations from companies and the chances of their bosses getting knighthoods and peerages. I am sure that that is a matter of coincidence. It has also been a long-running scandal that the Conservative party does not publish proper accounts, even for its own members.
Recent events—particularly the case of Mr. Asil Nadir —have made this a major and burning public issue. We are talking about some very big money. Donations to the central Tory party came to an estimated £7.5 million in 1989, £7.9 million in 1990, £15.8 million in 1991, and a whopping £20.7 million in 1992. Donations from constituency associations and published donations in company accounts came to only a small percentage of this. So where is the rest coming from? It has become increasingly clear that it comes from extremely wealthy individuals, both at home and abroad.

§ Mr. David Winnick (Walsall, North)
Such as Asil Nadir?

§ Mr. Spellar
I am not sure whether Asil Nadir should be regarded as a domestic or overseas donor in this context. We have an estimate of his donation, admitted by the Tory party, of £400,000. The press has reported figures ranging 868 up to £1.5 million. It has also been reported that moneys were being accepted from him when it was clear that his business was in a shaky state. We do not know whether the money came out of his own pocket or from his company without even being legally reported. I am sure that his creditors will be most interested in knowing that. We hope that the chairman of the Conservative party will shed some light on the matter.
British pension funds—and that means, in real terms, ordinary British pensioners—lost some £2 billion when Polly Peck crashed. We know that Asil Nadir received considerable support. What the public want to know about Asil Nadir and others is, what did they pay and what did they get for it? We know what Asil Nadir got. He did not get his knighthood, but he got seven Tory Members of Parliament, including Ministers, to press his case.
What did the others get and what did they pay? What of some of the other dubious donors whose names have been linked with Tory funding?

§ Mr. David Evans (Welwyn Hatfield)
What about Robert Maxwell?

§ Mr. Spellar
I am very pleased to hear that the Bill has all-party support. It shows that there is a great demand for it and it is extremely helpful to know that it is widely supported, even from such a dubious source.
What about Mr. Gerald Ronson, who was briefly a guest of Her Majesty's Government, who is alleged to have made donations through companies, possibly in the Virgin Islands? Jack Lyons was convicted of fraud and stripped of his knighthood and Nazmu Virani is now facing fraud charges regarding false loans from BCCI.
It is said that one of the benefits to donors was a tax break for foreign business men who are given tax exemptions equalled only in Switzerland, the Channel Islands and Luxembourg. How much is that costing the taxpayer? Is it not ironic that, when the Secretary of State for Social Security, the mad axeman of the Government, is prepared to savage the welfare state, the Government are forgoing substantial tax income from people who already have more money than they need? It is even reported that the Prime Minister hosted a fund-raising dinner for some of them.
One alleged beneficiary is John Latsis, who was extremely friendly with the Greek colonels. Another is Mr. Li Ka Shing, a Hong Kong billionaire who is well connected in Beijing. He is alleged to have given about half a million pounds.
It is ironic that the Tories made so much fuss about money going from Moscow to the Communist party. It seems that Communist-connected money is acceptable from Beijing but not from Moscow. It is also said that the Prime Minister dropped off for a special dinner in Hong Kong. We want to know the facts, and so do the public.
Why should overseas plutocrats take such an interest in our affairs to the tune of an estimated £7 million in 1991–92 alone? It is not just a question of foreign business men; it is believed that foreign Governments are also involved. The Governments of Brunei, Malaysia and Saudi Arabia have all been mentioned in articles. Is the British Government's foreign policy up for sale? What is the truth and how many others are there? The public have a right to know.
869 The United States have sensibly banned foreign donations and we should follow that example. It is an outrage that the Tory party should be wrapped up in such secrecy and be dependent on excessively large donations or loans from those who are not prepared to be publicly identified.
More than 100 years ago, in 1883, Lord Randolph Churchill told the Tory party conference in Birmingham: When you allow secret expenditure, you will certainly have corrupt expenditure. It is equally absurd that the Government are not prepared to provide proper accounts showing where the money goes and the level of their debts. It is only when we get a revelation like the spending on the legal bill of the right hon. Member for Kingston upon Thames (Mr. Lamont) that the facts come out. The response of the Tory donors was drastic: half a million pounds was the estimate from the current vice-chairman of the Tory party.
Perhaps that is why the Government are so reticent, but, as Professor Keith Ewing said in evidence to the Home Affairs Select Committee, Those who have nothing to hide have nothing to fear". The Select Committee may come up with other measures. All I am hoping to do is to enable light to be shed on the dark and sleazy world of Tory political finance which has been hidden from the public gaze for too long.