Lib Dems forced to dig deep to fight election

Chris Blackhurst reports on how the poorest main party hopes to raise pounds 2m to fill an empty war chest

Delegates to the annual Liberal Democrat conference in Glasgow, starting on Sunday week, will receive a stark message. "The political priorities, particularly in relation to our preparatory work for the general election, are stretching our fund-raising capacity to the limit."

This warning, contained in the annual accounts, comes from Tim Clement- Jones, chair of the party's federal finance and administrative committee.

The poorest of the three main parties, the Liberal Democrats have never been able to count on corporate or trade union largess. So, when Mr Clement- Jones reveals the party has an overdraft of pounds 150,000 with a general election less than two years away, something has to be done.

Officials say that at least pounds 2m is needed to fight the election. Last year the party had a total income of pounds 2.2m and spent every penny.

The annual minimum subscription is currently pounds 3, with the recommended amount pounds 24. But on average, admits Graham Elson, the party's general secretary, each of the 110,000 members gives much less than the recommended sum, about pounds 12. At Glasgow, a motion will be proposed to raise the sub to pounds 4 and the suggested figure to pounds 25. Its impact on the party's ability to fight the next election will be minimal, but other initiatives are being tried.

The Lib Dems were the first party to launch their own credit card - the so-called "Paddy card" - in conjunction with the Co-op Bank. Every time the card is used, the party gets 0.5 per cent commission.

Littlewoods football pools are another nice earner. Fill in a dedicated Lib Dem coupon and the party receives 12.5 per cent of the premium.

Another 40p goes into the coffers every time a member uses the party's own film development service. Travel and car breakdown deals with a cut for the party are next on the list. Direct-mail appeals will also be stepped up. "There will be a big push on standing orders and donations," said one insider.

With the Lib Dems eschewing some of the methods of their rivals - they do not go in for pounds 500-a-plate dinners and have achieved only mixed results from press advertising - greater emphasis is being placed on individual gifts, especially from wealthy business people.

Business Forum, the party's liaison group with industry leaders, is being reinvigorated. Companies are unlikely to donate, admits Mr Elson - unless they follow the trend of giving to all three parties to avoid a shareholder backlash - but their chiefs may reach into their pockets. "We see leading businessmen as individuals as our supporters, not corporations."

Likely business donors have been invited to listen to Paddy Ashdown's speech and to attend a Business Forum meeting the same evening. "We're looking at doing something with them," said Mr Elson, "but it will not be as furtive as the way the Labour Party behaves."

Against this backdrop, the party's increasing popularity among Asian business leaders is a welcome bonus. A trend that was dramatically highlighted by the gift of pounds 50,000 worth of computers from the one-time tycoon Nazmu Virani, has now become the focus for a major effort. Mr Elson said: "We understand their desire for the Asian community to be more involved in the political process." His senior colleague, Ramesh Dewan, a multi-millionaire, is aiming to attract "several hundred" Asian businessmen, each hopefully giving five-figure sums.

t The Liberal Democrats yesterday joined John Major and Labour in the phoney general election contest by declaring their own campaign would be considered launched at their conference later this month.

The party will also become the first in the United Kingdom to hold its national conference north of the border in an effort to reaffirm its commitment to Scotland and devolution.

Launching the agenda for the event in Glasgow, Jim Wallace, leader of the Scottish Liberal Democrats, said the party would use the conference to "kick off" its general election campaign - up to 20 months in advance of the actual contest.

He confirmed that the conference would culminate with a set of firm legislative priorities, the "Liberal Democrat Guarantee". Key features of the core policies will include a benefit transfer programme to provide an incentive to employers to train long-term unemployed people; measures to reduce car pollution and switch spending from roads to public transport; and nursery education for all three and four year-olds whose parents want it.

Representatives will also call for a pounds 1m limit on National Lottery prizes and the banning of the Instants scratch card game.