Tories attack 'profligacy' of party leadership: Fowler urged to account for 'sorry state of finances in light of pounds 19m deficit'

THE CONSERVATIVE leadership was lambasted by rank-and-file party critics yesterday for feeding 'their addiction to profligacy' with a pounds 19m deficit.

Calling on Sir Norman Fowler, the party chairman, to account for 'the sorry state' of party finances, Mike Baker, chairman of the trustees of the rebel Charter Movement, said that the Conservatives' financial position had worsened 'to the point at which it is having a deep and damaging effect on party members everywhere'.

In the absence of an official balance sheet, the movement published its own analysis of party finances, and pointed out the irony that Conservative members had fewer rights 'than those given to trade union members by Conservative governments'.

Urging a Commons Home Affairs Select Committee investigation to consider legislation to ensure democratic accountability of all political parties, the movement called for the implementation of a number of basic principles: 'The Conservative Party should not be financed from abroad. It should not be financed by or on behalf of foreign governments.

'It should not be financed by those who have no vote in United Kingdom elections. It should not be financed in a furtive way. It should not be financed by excessively large donations or loans from those who are not prepared to be publicly identified. It should not be financed without proper accounts to its members, for its income, its expenditure and its reserves (or its debts).'

Having asked Sir Norman how many sources had given the party donations in excess of pounds 1m, pounds 500,000, pounds 250,000 and pounds 100,000, the movement said: 'There have to be limits to donations from any one source and there have to be sources from which no donations at all are acceptable.

'There should be a formal policy on this, approved by Central Council.' But while the Central Council is the party's most representative body, it lacks defined authority and power.

As for the 'spendthrift ways' of the party machine, the movement said that the cost of the party headquarters in Westminster's Smith Square had risen by 56 per cent in four years to pounds 2.2m in 1991-92, while general administrative expenditure had increased 'by a truly astonishing 164 per cent', to nearly pounds 4.2m. 'In the four years to March 1988, Central Office spent in all pounds 34m. In the four years since then - excluding Central Office modernisation (nearly pounds 3.8m) - they spent pounds 64m, almost double. Now the chickens have come home to roost but, remarkably, nobody has been held responsible and nobody has said sorry.' It said that instead of accountability, those responsible for party funds had practised evasion and economy - 'with the truth'.

Replying to a report that Central Office had refused to acknowledge that the party was in debt, saying 'we have deficits, not debts', the movement said that amounted 'to an acknowledgement that there are funds available to it that at least equal the accumulated deficit. This would mean funds of pounds 19m or more . . .

'If Central Office does not have a debt, then a massive secret is being kept from party members. If Central Office does have a debt, then party members are entitled to be told how it is to be cleared - and only a full explanation will reassure those constituencies who think their reserves might be plundered.'

Called to Account. Charter Movement, 2 Devon Cottages, West Common, Gerrards Cross, Buckinghamshire SL9 7RG.