Why won’t the Tory party do the right thing and hand back ‘dirty’ money?

The prime minister promised ‘integrity, professionalism and accountability’, writes Sean O’Grady. Frank Hester’s racist remarks show the Conservatives know the price of such ethical ambitions – it’s about £10m

Frank Hester, who made a fortune from public sector contracts, became the Conservative Party’s biggest donor (TPP/Youtube)

When Rishi Sunak became prime minister, he declared that he stood for “integrity, professionalism and accountability”. That was how he intended to run his government and – it is reasonable to presume – his party as well. In those salad days, he was regarded as all of those things – and bright and competent with it. Maybe not so much now.

Still, he has now (belatedly) said the right thing about Frank Hester’s reported remarks about Diane Abbott – and condemned them as racist. But the question arises: will he do the right thing and hand the £10m that Hester gave the party back to this generous but flawed donor? It’s really what you’d colloquially call “dirty money” – no corruption is hereby meant or implied – because of its involvement with this extremely ugly row.

Imagine, for a moment, if it were some local businessperson in Sunak’s constituency who made the winning bid of £1,000 for a bottle of House of Commons scotch, signed by the PM, at the Richmond Conservative Association fundraising dinner. Then it emerged in the press that the businessperson had made some blatantly racist remarks about a female Black Labour councillor a few years back. Outrage. Ways would be found to return the £1,000, though the guy could probably keep the whisky, if only to help console himself.

That would be mostly that. Reversing the whole transaction and erasing it from the association’s reputation would be the obvious course of action – one imbued with the values of “integrity, professionalism and accountability”, in fact. The local MP would approve.

But the case of Hester is different. Different by £9,999,000, to be precise. Ten million quid, if it’s been spent or contractually committed, isn’t the kind of money that even the Tories and their rich friends can find very easily, assuming they’d even want to. It’s about half of their income for the year, and doing the right thing in this case is, well, awkward.

It might even have been a reason why it took Sunak so long to take his decision. His party is in electoral trouble enough without being skint and at risk of bankruptcy. At the moment, the previous uncertainty about what to do with Hester himself (he has since apologised for making “rude” comments about Abbott, but said they had “nothing to do with her gender nor colour of skin”) is being replicated over Hester’s money.

They don’t know what to do about returning it, and they haven’t got a ready explanation for why they shouldn’t, and thus ministers say different things on the media about whether it should go back, or whether the money is not relevant, or that they’d consider not taking any more cash from that quarter. They dither, and it’s not impressive.

Of course, the other factor is that the enormous size of the donation raises questions and hackles. Hester is a self-made man who believes the Tory party is best for the country. He is also, putting it as neutrally as possible, someone who owns a medical business that relies on substantial contracts from the National Health Service.

It might be, as some have suggested, that it should be Hester returning far larger sums of money to the NHS, because he isn’t the sort of chap that we want our taxpayers’ money going to. I can’t help but mention that the NHS is full of Black women at every level providing care and life-saving expertise, the women who, to use Hester’s own word, he has been so “rude” about. Or racist. He is a man who does not sit easily in that space, shall we say.

The £10m donation also raises once again the problem of funding our politics. Hester is an example of what can go wrong, but every party has had its problems, to say the least. As prime minister, Tony Blair was once questioned under caution during the so-called “cash for honours” scandal in the 2000s, and his reputation suffered an early knock from donations given by F1 tycoon Bernie Ecclestone.

You could also ask Nicola Sturgeon about how badly money and politics mix. Even the saintly Liberal Democrats have and their dodgy moments – and it was, after all, David Lloyd George who invented the modern practice of flogging a peerage to the highest bidder.

Countless efforts to reform the system have helped clean it up, only for the ingenuity of those involved to think up new ways of evading the rules – for example “lending” parties’ money rather than donating it, loans that are not expected to be paid back on any realistic timescale.

We abhor public money being spent on politicians, and the Labour Party can’t afford to abandon reliable trade union funding. The fact is that we just have to carry on and muddle through, set some limits to campaign spending and hope that the media and the relevant authorities, such as the Electoral Commission, can patrol the system to prevent the worst abuses.

It wasn’t that long ago that analysis by The Independent showed how a significant amount of Tory party donations came from just a handful of wealthy people. It emerged in 2021 that a group known as the “advisory board” had been developed to connect the party’s biggest financial backers with ministers.

Darren Hughes, chief executive of Electoral Reform Society said: “These figures [by The Independent] show just how concentrated donor power is in UK politics. Political debate shouldn’t be something bought by a few very wealthy individuals. The fact that a small group have provided such a large amount of political funding and gained the potential influence that comes with it is of great concern.”

The Hester affair will not be the last ugly donation incident. Until we have limits placed on the size of political donations and checks in place to keep an eye out for imaginative workarounds, “integrity, professionalism and accountability” remain mere lofty ambitions for any political party.