THE CONSERVATIVE Party has been boosted by the electoral commission’s decision that £5 million (€5.5m) worth of donations from a company controlled by billionaire Michael Ashcroft are legal under British law and do not have to be paid back.
However, the commission expressed exasperation at the decision of senior Conservative officials to refuse to appear before it, and at Lord Ashcroft’s decision not to supply it with internal papers from his company, Bearwood Corporate Services.
In a pointed statement, the commission said it had now asked to meet Conservative officials “to ensure that they are clear about their responsibilities for complying with the law”.
It rejected the central charge made by Labour MP Tony Mann that Bearwood – which is controlled by Lord Ashcroft – was not carrying on business in the UK and was, therefore, ineligible to donate money to political parties.
Claiming a “clean bill of health” last night, the Conservatives said the donations from Bearwood are “legal, permissible and correctly reported”, while Lord Ashcroft’s non-domicile tax status means he is “in the same position” as Labour and Liberal Democrat peers.
However, the Labour Party is not about to let up on its attacks upon Lord Ashcroft, who was given a peerage in 2001 when he promised to become a full-time resident – which should have made him eligible for full UK taxes.
The public administration committee of the House of Commons has now – to the fury of Tories – called on Lord Ashcroft to give evidence in public on March 18th.
The select committee has six Labour, three Conservative and two Liberal Democrat members – reflecting the balance of parties in the Commons – and, like all such committees, tries to work on the basis of consensus.
Though the electoral commission has accepted that Bearwood operates in the UK, there is no doubt that the money donated to the Conservatives – which has funded its efforts to win up to 160 marginal seats – has come from Belize, where Lord Ashcroft has major investments.
Donations from overseas companies are prohibited by law. The ultimate source of the Ashcroft millions that have helped bankroll the Tories in the past appears to be Belize, the Caribbean tax haven that the billionaire has claimed in the past to be his home.
Defending its decision not to let officials appear before the commission, the Conservatives said it had wanted to speak to seven of them “for up to three hours each” in “the run-up to a general election”.
“Understandably, we simply wanted to clarify whether these interviews were necessary or reasonable,” said a spokesman.
Labour’s Peter Mandelson said the Conservatives’ admission yesterday that party leader David Cameron had only found out in the last month that Lord Ashcroft had not met his 2001 tax pledges are astonishing. “At a press conference in December 2007 David Cameron said that he had asked Lord Ashcroft and was given the ‘reassurance that the guarantees he made at the time are being met’,” said Mr Mandelson.
“So either David Cameron was misleading the British people in December 2007, or he was being misled.”
Meanwhile, the latest opinion poll showed that the Tories’ lead in 100 all-important marginal seats is now down to just 2 per cent and not enough to produce a Tory majority. The gap is now at its closest since shortly after Gordon Brown became prime minister in the autumn of 2007: 39 per cent of voters said they would vote Conservative and 37 per cent said Labour.