Parties rapped over donation reporting

Political parties were urged to improve their disclosure of financial support today after more than £300,000 of donations were declared late.

The Electoral Commission said late reporting was "not acceptable" as it emerged the Tories received almost £217,000 in 2005 without declaring the money on the Register of Donations.

Labour, the Greens and the UK Independence Party also made disclosures which were at least six months overdue and there were still more to be declared, the Electoral Commission said.

The late declarations came alongside the regular quarterly update of the Register of Donations, which included loans for the first time since the cash-for-honours row broke.

The Labour Party reported more than £28 million, the vast majority of which was received before the latest accounting period of April to June, it said.

The Tories declared more than £2.8 million of loans which the Electoral Commission said had been received during the second quarter of 2006.

The Liberal Democrats' declaration of £584,000 is also understood to include donations from prior to the reporting period.

The Electoral Commission said it was "disappointed" that not all parties had declared their loans voluntarily ahead of September 11, when they will be statutorily obliged to do so.

Chief executive Peter Wardle said: "Full disclosure of both donations and loans is vital to address public concern about the transparency of political party funding.

"The fact that the main parties seem to be struggling with the level of disclosure that we have called for on a voluntary basis suggests that they are ill-prepared to comply with the new laws that Parliament has put in place.

"We will do all we can to ensure the parties understand the new requirements, but they need to take them seriously to restore public confidence."

Regular quarterly figures for the second quarter of 2006 showed £10.7 million had been donated to 16 parties between April and June.

Labour received £3.4 million, the Tories £5.9 million and the Lib Dems £783,000.

Another £309,639 was declared for 2005 which should have been registered with the Electoral Commission by the end of February.

They included £216,933 to Conservative Party associations, £9,500 to Labour, £27,543 to the UK Independence Party and £1,200 to the Greens.

These donations only came to light when they were spotted in parties' annual accounts. The Electoral Commission said there were more to come.

"Some parties have also told the Commission that there are further donations which should have been reported, but which do not appear in today's figure," it said.

"The Commission has given the parties until September 30, 2006 to report these further donations."

The Commission added: "Whilst the vast majority of donations are reported on time, the Commission believes that late reporting of donations is not acceptable.

"We will continue to highlight the instances where donations are reported late and we expect the parties to improve their reporting systems."

In addition, the three main parties reported loans totalling more than £31.5 million.

Labour declared £28,200,693.85, the Tories £2,812,000 and the Lib Dems £584,239.08.

"The Commission is disappointed that, despite public commitments, not all parties have made sufficient efforts to provide details of loans made to their accounting units, and in some cases to their national headquarters," it added.

"Given this situation, it is clear that all parties will need to make immediate efforts if they are to be in a position to comply with the requirement in the Electoral Administration Act to report loans on the same basis as donations from September."

There was confusion earlier when the Electoral Commission's literature appeared to show that Labour's newly-declared loans had been received in a three-month period this year.

The Commission clarified later that the loans had been declared, rather than received, during the reporting period April 1 to June 30.

The parties had interpreted the voluntary code in different ways with the Tories reporting only those received during the period.

Labour and the Lib Dems had declared previous loans as well, the Commission said.

The Tories' £2,812,000 of declared loans included sums of £2.5 million and £300,000 from Allied Irish Bank.

Labour's borrowing, totalling £28,200,693.85, included £13.5 million from the Co-operative and Unity Trust banks as well as a series of loans which emerged earlier this year.

They were: £517,000 from Gordon Crawford; £1,068,638.85 from Barry Townsley; £1,033,000 from Andrew Rosenfeld; £2,168,305 from Lord Sainsbury of Turville; £2,455,250 and £300,000 from Sir David Garrard; £258,500 from Sir Gulam Noon; £1 million from Professor Sir Christopher Evans; £1,500,000 from Dr Chair Patel; £400,000 from Derek Tullett; £1 million from Nigel Morris; £1 million from Rod Aldridge; and £2 million from Richard Caring.

The Lib Dems declared £584,239.08 of loans, the biggest of which were £250,000 from Lord Alliance, £125,000 from Paul Marshall and £100,000 from Lord Razzall.

Labour general secretary Peter Watt said the Tories had failed to reveal the full extent of their loans.

"The Labour Party has declared all its current loans as will be required by legislation which will come into force this September.

"It appears that the Tories have only declared loans taken out in the last quarter. In addition to this they still have not declared who their overseas lender was.

"If the Labour Party was to declare in the same way as the Conservatives, we would have had no loans to declare for this quarter.

"However, if the Conservative Party was to report in the same way as the Labour Party, it appears they would be declaring loans totalling more than £39 million."

He added: "Labour has always and continues to lead the way in the transparency of party funding."