Billionaire Mittal gives Labour £2m donation

The party yesterday issued a statement thanking the Indian steel billionaire, who has an estimated fortune of almost £15bn, for his "very generous donation" and "continued support". The donation was received yesterday and matches the record £2m given to Labour by Lord Sainsbury before the last general election.

It is believed to be the third donation the businessman has made to the Labour Party. It follows a £16,000 gift in 1997 and a controversial gift of £125,000 in May 2001, which prompted a row over Downing Street's intervention to help Mr Mittal buy a Romanian company. Two months after the donation Tony Blair wrote to Adrian Nastase, his Romanian counterpart, in support of Mr Mittal's attempt to buy the Romanian steel firm Sidex. The deal was signed in July 2001, two days after Mr Blair's letter was written.

Mr Mittal is famously publicity-shy and he seldom talks about his riches. But his wealth has quadrupled in the past year, jumping from £3.5bn to an estimated £14.8bn, according to the The Sunday Times Rich List, which makes him the wealthiest resident of the UK.

He is known to have spent lavishly on an extravagant wedding for his daughter. The wedding, at the 17th-century chateau, Vaux le Vicomte, is said to have cost £30m and was attended by Kylie Minogue and Bollywood film stars. Last year, the steel tycoon spent £57m for a house in Kensington Palace Gardens owned by Bernie Ecclestone, the Formula One entrepreneur whose £1m donation to the Labour Party was returned.

In a rare interview last year, Mr Mittal said that he was "really disappointed by the amount of fuss there was" about his donation to Labour in 2001. He said he had donated the £125,000 because he was supportive of the Labour leadership and its policies. "I like Tony Blair and I love the party," he said. He had not anticipated the Government would intervene on his behalf in 2001 donation and was "expecting nothing," he said.

Mr Mittal praised Labour's "significant and very positive impact" to prosperity in Britain yesterday, adding: "I believe that the Labour Party has made a significant and very positive impact on the overall prosperity of the United Kingdom since it came to office in 1997.

"The party has set out long-term investment plans to further improve education, health, employment, skills and technology and I am supportive of the work it is doing in these fields.

But Labour's decision to release the news of the £2m donation while the media was dealing with the aftermath of the London bombs will raise questions about the timing.

The party is not required to release the information about the donation, until the Electoral Commission publishes its list of quarterly donations from political parties.

The Labour Party denied yesterday that by releasing the information it was trying to bury the story under the extensive media coverage of the terrorist attacks.

"The electoral rules are that we have to register it with the Electoral Commission," a spokesman said. "We have chosen to go public on it as well. We are grateful to everyone who contributes whatever they can to the Labour Party."

Labour faced an outcry about burying bad news almost two weeks ago when it released at 5pm on a Friday reports written by John Birt, the Prime Minister's strategic adviser just before the G8 and the Olympic decision.

* The Home Office said that Louise Casey, Tony Blair's antisocial behaviour adviser, had apologised for an after-dinner speech where she boasted about how she got "hammered" and threatened to "deck" officials. Ms Casey, in a speech which was recorded, also appeared to ridicule Tony Blair's anti-binge drinking initiative.A statement said: "Louise has acknowledged some of these remarks were ill-judged and inappropriate."