Labour may launch party cash inquiry

AN INQUIRY into the funding of political parties in Britain seems certain if Labour wins the forthcoming general election.

AN INQUIRY into the funding of political parties in Britain seems certain if Labour wins the forthcoming general election.

The issue has dogged the Prime Minister, Mr John Major, and the Conservative Party throughout this parliament.

Secrecy about overseas donations to the party, and the "cash for questions" scandal at Westminster, have fuelled Opposition charges of Tory "sleaze".

But the prime minister has resisted repeated calls to have the issue referred to the Nolan Commission on standards in public life.

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The most recent demand that he should do so followed press reports suggesting the Conservative Party has raised almost £50 million in the course of the past year.

Just two years ago the Tories were reportedly £19 million in the red. Mr Tony Blair, together with the leaders of all the minority parties, wrote to Mr Major on November 20th expressing "serious doubts" about this dramatic turnaround in his party's fortunes.

Urging Mr Major to allow an investigation by Lord Nolan, the party leaders said failure to do so would lead them to assume "that you believe there is something to hide over the sources of Tory party funding".

The Representation of the People Act imposes strict spending limits on candidates in parliamentary elections. But there is no constraint on party funding, and no requirement for more than the most cursory disclosure.

The Liberal Democrats favour state funding of political parties. Labour has stopped short of that, but would almost certainly support such a recommendation following an official inquiry. Meanwhile, the party says it operates its own code barring any overseas donations and requiring declaration of any gifts over £5,000.