HC Deb 31 January 1996 vol 270 cc1003-10 3.35 pm
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. The Bill would require the disclosure of the source of donations, prohibit donations from overseas sources and require the publication of accounts.

Once again, the funding of political parties is on the agenda, put there by no less a person than the Prime Minister. Only last Thursday, at Prime Minister's Question Time, he raised the question of Labour party funding when he said: We know who pays 50 per cent. of the money that the Labour party gets."—[Official Report, 25 January 1996; Vol. 270, c. 476.] He was quite right: we do all know.

The Prime Minister seems very keen to publicise the source of funding of the Labour party—and why not? It is no secret. Party accounts make it quite clear, and the law makes strict provision with regard to the operation of trade union political funds. Unfortunately, no such transparency applies to the funding of the Tory party. Shrouded in mystery and obscurity, a host of secretive companies and organisations were created after the war to funnel secret loot into the Tory party, and our Prime Minister seems to want to keep it that way. What a perfect example of saying one thing and doing another.

The Bill is a simple measure. It has three main aims—to prohibit donations from foreign nationals not normally resident in this country and from overseas companies and Governments; to ensure the recording and publication of donations above a certain limit—I am not tied to a particular figure, but the limit would probably be about £1,000; and to require political parties to publish full income and expenditure accounts in the same way as companies and trade unions.

The issue is so unremarkable that in 1949 the House passed a motion requiring parties to publish accounts. Unfortunately, it has not yet been properly activated by the Tory party. We know that the matter is of considerable concern not just to Opposition Members but to many members and supporters of the Tory party. It may also be of interest to those who do their business with the Royal Bank of Scotland, which seems to have allowed the Tory party a huge overdraft—at one stage hitting nearly £16 million. My Scottish colleagues may wonder whether small businesses that bank with the Royal Bank of Scotland receive such helpful treatment if they encounter cash-flow crises in their day-to-day affairs.

Publication might also help the Prime Minister, who was very confused about the sources of Tory funding a couple of years ago. He now ducks questions about the use of Downing street for Tory party functions. I have here an invitation to the winter ball in aid of Conservative party marginal seats, which states: You will shortly be receiving (or may already have received) an invitation to the launch reception at 10 Downing Street. The Prime Minister has even less idea of what is going on around the country. When I raised the point with him at Question Time on 19 October 1993, he said that he must let me into a secret: There are a great many secret sources and they are all cheese and wine parties up and down the country."—[Official Report, 19 October 1993; Vol. 230, c. 144.] One wonders how much wine and cheese the Tories stuffed into that fugitive from justice, Asil Nadir, who, as they have now admitted, donated more than £400,000. One wonders whether they will pay that money back to the unfortunate people who lost heavily in the crash of Polly Peck. One also wonders why they could not confirm the donation immediately, and why they were careless enough to dump the records of donations so that they were unable to provide the receiver with facts and figures. And one must wonder whether they will repay the money donated by ex-Nissan boss Octav Botnar, who is currently hiding in Switzerland to evade the attentions of the Inland Revenue. What about Mr. Virani—another heavy donator to Tory funds who ended up inside? Who are the real villains' friends here—Botnar, Virani and Nadir?

There might also be concern as to how much foreign business men, particularly Greek shipowners, have donated. We could then match the figure with the amount lost to the Treasury each year through the tax loophole that benefits them—foreign domicile tax status. It is an interesting provision and such an unusual arrangement that we are one of only four countries in western Europe to have it. The others are Switzerland, Luxembourg and the Channel Islands, which are all well-known tax havens.

It would also be instructive to find out how much money has come from Hong Kong. It appears that the Tories have still not shaken off that habit. Even this year, it is reported that the Foreign Secretary attended fund-raising meetings during his recent visit, even though one presumes that his trip to Hong Kong was funded by the British taxpayer. One wonders whether, following the deterioration of relations between China and Britain, Hong Kong business men were as generous with their donations as they have been, but that will not stop that lot trying to get money from them.

What is remarkable is that legislation forbidding foreign donations has been in place in the United States, Germany, Canada and other countries for some years and is accepted as normal. The British public have a right to know whether one of the main political parties is in hock to foreign business men, companies or, indeed, countries.

The publication of donations was introduced a number of years ago in the United States, which was followed by other countries, including Australia. It does not seem to provide any particular difficulties for them. Is not it surprising that the Conservatives are so keen to invoke the right to silence in this case? Of course, they might be following the precept that they chant regularly from the Dispatch Box that, "Those who have nothing to hide have nothing to fear." Perhaps they are concerned that people might detect—how can I put it delicately—a strong statistical correlation between donations to the Tory party and the provision of knighthoods, peerages, and now, places on quangos, let alone ministerial access for companies.

That highlights the problem that the Tories face. They are kept together only by their monopoly of patronage through honours, quangos and political favours. They are a narrow oligarchy clinging to central state power, propped up by a few high-spending companies and individuals and by foreign interests. More and more, their previous supporters in industry and construction are deserting them, as they realise the harm that is being done to their businesses by Government policy.

Even Lord McAlpine, the previous treasurer of the Tory party, said only this week that the construction industry must explain to the government how its handling of the British economy has, over the past five years, systematically destroyed Britain's construction industry, and that this has to stop. Even that industry is deserting in the face of the Government's actions. Frankly, the Conservative party is knackered.

It was most instructive to watch the programme on Tory wives the other month. Look at what happened when they held constituency functions. Nearly all the participants were pensioners. That graphically illustrated what has been reported in the press, particularly The Daily Telegraph—that the Tory party is an elderly and aging party with an average age of 60. New blood is not coming into the party. Lots of those who stay do so only to belong to Conservative clubs, which reputedly have the best snooker tables. The Young Conservatives, which was once the largest youth movement in Europe outside the Komsomol, is down to 5,000 members and half of them are barmy. That is why the Tory party has had to cancel its youth conference. Meanwhile, the young Labour movement is at 25,000 and roaring ahead.

At councillor and Member of the European Parliament levels, Tory representatives are becoming an endangered species. That is why the Tories have to seek out and cover up the supply of dodgy money. The Bill is aimed at cleaning up the financing of British politics and ensuring that British parties are not up for sale. It would be considered normal in our fellow democracies and will be considered common sense by the voters of this country and I commend it to the House.

3.43 pm
Mr. David Shaw (Dover)

I oppose this Bill on the regulation of the funding of political parties. It contains more than a whiff of hypocrisy. The stench of hypocrisy surrounding it is much like that of the sewers before we privatised the water companies.

One objective of the Bill is to move Britain towards the state funding of political parties. That would be extremely damaging but Labour would like to do it. It is not about regulating those who financially support political parties but about keeping secret the millions of pounds of trade union support to Labour that would fall outside its terms. It is a classic case of Labour saying one thing and doing another.

Labour talks about disclosure of party funding and openness. The hon. Member for Warley, West (Mr. Spellar) said that there is no secrecy about Labour party funds. That statement is not true. There is a lot of secrecy when one starts to look at Labour party accounts. The Labour party makes many statements about disclosure and openness, but it says one thing and does another. The hon. Gentleman's entry in the Register of Members' Interests shows that he receives trade union funding from two sources but there is no disclosure of or openness about the amount of money that he gets from them. He is guilty of saying one thing and doing another.

The Conservative party's openness is revealed by the extent of the information that the hon. Member for Warley, West has been able to find. As he knows, we in the Conservative party go to a lot of wine and cheese parties and chicken dinners. Sometimes the cheese is not up to scratch; sometimes the chicken is not as nice as we would like it to be. But we know that we are raising an honest penny for the Conservative party's coffers. We do not pick up the phone, as does the Labour party, to call a friendly trade unionist to get thousands of pounds. We do the hard work of going around the chicken and cheese circuit to get money for the Conservative party.

I invite hon. Members to look at the Labour party's national executive committee reports. In the 1986 report they will find an advertisement by Robert Maxwell—funding the Labour party. If they look again, they will find an advertisement for a Soviet book shop—funding the Labour party. There was no reference in the speech of the hon. Member for Warley, West to the member of the other House who sits on the Labour Front Bench and who took £250,000 of pensioners' money three weeks before Robert Maxwell jumped overboard. That is how the Labour party and its Members fund themselves.

There is worse than that. The latest accounts of the Labour party reveal that 57 per cent. of its funds come from the trade unions. However, that is 57 per cent. of what we are told about. There are many entries in the Labour party's accounts that cannot be reconciled. For example, I have here some leaked minutes of the National Trade Union and Labour Party Committee. Donations called affiliation fees from trade unions add up to £3.6 million. The Labour party's accounts give the figure as £6.6 million. There is a lot of difference between £ 6.6 million and £3.6 million. Where is the £3 million?

Mr. Bruce Grocott (The Wrekin)

On a point of order, Madam Speaker.

Mr. Shaw

Where are the extra affiliation fees that the Labour party does not disclose in its accounts?

Madam Speaker

Order. I have a point of order.

Mr. Grocott

The hon. Gentleman is clearly arguing in favour of greater disclosure of party funding details, which is exactly what the Bill is about. He is making a speech in favour of the Bill which masquerades as one against it.

Madam Speaker

I do not interpret the speech of the hon. Member for Dover (Mr. Shaw) in that way. He is keeping himself in order. He has another minute or two in which to finish.

Mr. Shaw

I am grateful for your support, Madam Speaker.

If we consider the trade union figures, we find no openness and disclosure. The minutes of the meeting say that Unison's donation to the Labour party is £700,000, but, when one goes to Unison's accounts£buried away on a page that is difficult to find, somewhere in the middle of a 50-page document£one finds that the figure is £1,989,000, equivalent to one sixth of Labour party expenditure.

That is not the whole story. The Labour party receives more money from Unison than is disclosed in that figure. Another £94,000 is disclosed as being for parliamentary activities. Once upon a time, we were told that the Labour party would disclose how that figure is made up, and that we would find out which Front-Bench Labour Members are receiving the money, but no such disclosures have yet been made. In that regard, Labour Front-Bench Members are guilty of saying one thing and doing another.

The Labour party does not disclose five other funds in its central accounts. The Industrial Research Trust, once mentioned in disclosures of the Leader of the Opposition and the deputy leader in the Register of Members' Interests, has now been excluded from public view and taken out—another example of saying one thing and doing another. No details are available for public scrutiny on the Labour leader's office fund—another example of saying one thing and doing another.

There are no disclosures of what the Lionel Cooke Memorial Fund is, of the details, of donors and of the size of donations. There are no disclosures of the details of the National Trade Union and Labour Party Committee funds, of the donors and of the size of donations. That is an example of the Labour party saying one thing about openness and disclosure, but doing another. [HON. MEMBERS: "Hypocrisy"] My hon. Friends may say the word "hypocrisy": I could not possibly comment.

The Labour party is in trouble. If we consider its membership and the NEC report, we find that the Labour party boasts an 85 per cent. retention rate. If we turn that statistic around, however, it means that 15 per cent. of the Labour party membership are either dying each year or are failing to renew their membership. The Labour party retains its members only for about six years on average and then they get fed up with the Labour party. The NEC report says: The party's growth in membership has brought little financial benefit centrally". There is still a high dependency on the trade unions in Labour party financing.

The Bill should be opposed because it is full of hypocrisy by the Labour party. In his speech, the hon. Member for Warley, West, in common with his Front-Bench colleagues, has been saying one thing and doing another.

Question put, pursuant to Standing Order No. 19 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of public business):—

The House divided: Ayes 163, Noes 62.

Division No. 41] [3.52 pm
AYES
Adams, Mrs Irene Burden, Richard
Allen, Graham Byers, Stephen
Armstrong, Hilary Callaghan, Jim
Ashdown, Rt Hon Paddy Campbell, Mrs Anne (C'bridge)
Ashton, Joe Campbell, Menzies (Fife NE)
Banks, Tony (Newham NW) Campbell-Savours, D N
Beith, Rt Hon A J Canavan, Dennis
Benn, Rt Hon Tony Cann, Jamie
Bennett, Andrew F Chidgey, David
Benton, Joe Chisholm, Malcolm
Betts, Clive Clapham, Michael
Bradley, Keith Clarke, Eric (Midlothian)
Bray, Dr Jeremy Clelland, David
Brown, N (N'c'tle upon Tyne E) Clwyd, Mrs Ann
Bruce, Malcolm (Gordon) Connarty, Michael
Corston, Jean Madden, Max
Cousins, Jim Mahon, Alice
Cox, Tom Marek, Dr John
Cummings, John Marshall, David (Shettleston)
Cunliffe, Lawrence Marshall, Jim (Leicester, S)
Cunningham, Jim (Covy SE) Martin, Michael J (Springburn)
Dalyell, Tam Martlew, Eric
Davidson, Ian Maxton, John
Davies, Bryan (Oldham C'tral) Meale, Alan
Davies, Chris (L'Boro & S'worth) Michie, Bill (Sheffield Heeley)
Davies, Ron (Caerphilly) Miller, Andrew
Denham, John Morgan, Rhodri
Dixon, Don Morley, Elliot
Dobson, Frank Morris, Rt Hon Alfred (Wy'nshawe)
Donohoe, Brian H Mudie, George
Dowd, Jim Mullin, Chris
Eastham, Ken Murphy, Paul
Etherington, Bill O'Brien, William (Normanton)
Evans, John (St Helens N) O'Hara, Edward
Ewing, Mrs Margaret Olner, Bill
Flynn, Paul Orme, Rt Hon Stanley
Foster, Rt Hon Derek Parry, Robert
Foster, Don (Bath) Pendry, Tom
Foulkes, George Pickthall, Colin
Fyfe, Maria Pike, Peter L
Galbraith, Sam Pope, Greg
Gapes, Mike Powell, Ray (Ogmore)
Garrett, John Prentice, Bridget (Lew'm E)
Godman, Dr Norman A Purchase, Ken
Godsiff, Roger Radice, Giles
Golding, Mrs Llin Randall, Stuart
Griffiths, Nigel (Edinburgh S) Rendel, David
Grocott, Bruce Roche, Mrs Barbara
Gunnell, John Rooker, Jeff
Hain, Peter Ross, Ernie (Dundee W)
Hall, Mike Ruddock, Joan
Hanson, David Salmond, Alex
Hardy, Peter Sheerman, Barry
Hinchliffe, David Sheldon, Rt Hon Robert
Hogg, Norman (Cumbernauld) Skinner, Dennis
Home Robertson, John Spearing, Nigel
Hood, Jimmy Spellar, John
Hoon, Geoffrey Squire, Rachel (Dunfermline W)
Hoyle, Doug Steel, Rt Hon Sir David
Hughes, Roy (Newport E) Steinberg, Gerry
Hughes, Simon (Southwark) Stevenson, George
Hutton, John Stott, Roger
Ingram, Adam Sutcliffe, Gerry
Jackson, Glenda (H'stead) Taylor, Mrs Ann (Dewsbury)
Jackson, Helen (Shef'ld, H) Taylor, Matthew (Truro)
Janner, Greville Tipping, Paddy
Jones, Barry (Alyn and D'side) Touhig, Don
Jones, Jon Owen (Cardiff C) Turner, Dennis
Jones, Martyn (Clwyd, SW) Tyler, Paul
Kaufman, Rt Hon Gerald Walker, Rt Hon Sir Harold
Khabra, Piara S Walley, Joan
Kilfoyle, Peter Wareing, Robert N
Litherland, Robert Watson, Mike
Lloyd, Tony (Stretford) Wigley, Dafydd
Llwyd, Elfyn Williams, Rt Hon Alan (Sw'n W)
Lynne, Ms Liz Williams, Alan W (Carmarthen)
McAllion, John Wilson, Brian
McAvoy, Thomas Winnick, David
Macdonald, Calum Wray, Jimmy
McFall, John Wright, Dr Tony
McKelvey, William
Mackinlay, Andrew Tellers for the Ayes:
MacShane, Denis Mr. Harry Barnes and
Ms Angela Eagle.
NOES
Alexander, Richard Beggs, Roy
Alison, Rt Hon Michael (Selby) Booth, Hartley
Ashby, David Brown, M (Brigg & Cl'thorpes)
Atkins, Rt Hon Robert Carrington, Matthew
Atkinson, David (Bour'mouth E) Cash, William
Banks, Matthew (Southport) Channon, Rt Hon Paul
Chapman, Sir Sydney Patnick, Sir Irvine
Dover, Den Pattie, Rt Hon Sir Geoffrey
Duncan-Smith, Iain Pawsey, James
Dunn, Bob Porter, David (Waveney)
Forsythe, Clifford (S Antrim) Riddick, Graham
Fry, Sir Peter Ross, William (E Londonderry)
Gallie, Phil Shaw, David (Dover)
Greenway, Harry (Ealing N) Shepherd, Sir Colin (Hereford)
Greenway, John (Ryedale) Skeet, Sir Trevor
Hamilton, Neil (Tatton) Smith, Sir Dudley (Warwick)
Hargreaves, Andrew Smyth, The Reverend Martin
Harris, David Sweeney, Walter
Hughes, Robert G (Harrow W) Taylor, Rt Hon John D (Strgfd)
Hunt, Rt Hon David (Wirral W) Thomason, Roy
Hunter, Andrew Thompson, Sir Donald (C'er V)
Jessel, Toby Townend, John (Bridlington)
Kellett-Bowman, Dame Elaine Townsend, Cyril D (Bexl'yh'th)
Knight, Dame Jill (Bir'm E'st'n) Tracey, Richard
Lamont, Rt Hon Norman Tredinnick, David
Lawrence, Sir Ivan Twinn, Dr Ian
Leigh, Edward Walker, Bill (N Tayside)
McCrea, The Reverend William Winterton, Nicholas (Macc'fld)
Marshall, John (Hendon S)
Martin, David (Portsmouth S) Tellers for the Noes:
Mitchell, Sir David (NW Hants) Mr. Paul Marland and
Montgomery, Sir Fergus Mr. Jaques Arnold.
Neubert, Sir Michael
Onslow, Rt Hon Sir Cranley

Question accordingly agreed to.

Bill ordered to be brought in by Mr. John Spellar, Mrs. Barbara Roche, Mr. Mike O'Brien, Mr. David Winnick, Ms Angela Eagle, Mr. D.N. Campbell-Savours, Mr. Andrew Mackinlay, Mr. Gordon McMaster, Mr. Chris Mullin and Mr. Denis MacShane.

    cc1009-10
  1. REGULATION OF FUNDING OF POLITICAL PARTIES 317 words