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azzuri · 'Our Scotland' Fossil Joined: 12 Sep 2005 Posts: 3797

see - http://www.theherald.co.uk/politics/60419.html

Loans row ‘has eroded public trust’

The row over party funding has unfairly reduced the standing of politicians, Lord Falconer admitted last night.

The Lord chancellor said that although the "vast majority" of British politics was "utterly uncorrupt", he conceded the secret loans scandal had damaged public trust in the political process.

"There was very considerable concern about the loans issue," Lord Falconer said.

Giving evidence to the constitutional affairs committee, the Lord chancellor said there needed to be greater transparency in the process and signalled his support for a cap on political donations and loans.

The Labour party will publish its proposals on party funding within about a month, Lord Falconer said.

His comments came after back-bench MPs launched an internet petition calling for the stable of Westminster politics to be "cleaned up" with an immediate halt to the appointment of new peers.

Angus MacNeil, the SNP MP for the Western Isles, whose complaint to the police led to the Scotland Yard investigation into allegations of cash for honours, highlighted the "happy coincidence" of donors giving money to parties and then ending up in the Lords. He described it as representing "almost a two-finger sign given to the public and saying: 'It's only a coincidence, lads, there's nothing much you can do about it. It's business as usual.' This is the end of business as usual."

Urging the public to sign the petition on www.cleanupwestminster.com Elfyn Llwyd, the leader of Plaid Cymru, said there had been a great deal of wrongdoing by several parties and what was urgently needed was "to clean up this stable".

"There has been one arrest," he said. "I believe it's been done with the understanding of somebody above. It might even reach to the office of No 10."

The person arrested, and released on bail, is Des Smith, a former government adviser on academy schools, who reportedly said sponsors of the schools could be given honours.

Mr Llwyd said he expected the police to interview Lord Levy, the prime minister's chief fundraiser and staff in No 10, "probably" including Tony Blair himself.

Martin Bell, the former independent MP who stood on an anti-sleaze ticket after the cash-for-questions scandal a decade ago, declared: "Out of great scandals come great reforms," adding: "We have a huge opportunity here to launch and maintain a campaign for honest politics."

During prime minister's questions, Mr Blair batted away questions about the controversy, saying: "I've no intention of giving a running commentary on this but I can say I'm delighted so many successful people support the Labour party and quite right too."

The online petition was denounced by veteran Labour MP Gwyneth Dunwoody, who described it as "a damn cheek".

She added: "The suggestion that somehow or other the whole of British politics is corrupt is not only fundamentally wrong, it's actually undermining the whole democratic system."

I'm absolutely amazed that they sent this guy out to comment on this issue - Lord Falconer - one of the guys the speculation surrounds. The arrogance of this Labour government is really starting to anger me - this sort of behaviour will be remembered for a decade after they are booted out of power.

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wisnaeme

Gung-ho · Nationalist Joined: 22 Jan 2006 Posts: 103

And Now some of them want the money back Labour could be in for some cash flow problems.

Labour faces financial crisis as backers demand return of loans
GERRI PEEV
POLITICAL CORRESPONDENT
TWO of Labour's millionaire bankrollers are demanding the party pays back £1.5 million of their secret loans in a move that threatens to throw the party's finances into turmoil.

Gordon Crawford, founder of a London software company, has openly called for his money back, while Nigel Morris, the US-based financial services entrepreneur, is believed to be the other creditor.

The timing - just weeks before the crucial May local elections in England - could not be worse for the party, which is fighting against a Conservative Party that boosted its coffers by £6.2 million between January and March.

A further two bankrollers - including Rod Aldridge, of Capita, the outsourcing firm - are also expected to serve notice on their loans, leaving Labour to foot a £3.5 million bill by October. The demands could force the party to sell its flagship central London headquarters, worth £6 million.

Mr Crawford, who was not one of the backers nominated for an honour or peerage, made it clear he wanted his cash back.

"The money was a commercial loan and it has already reached the end of its term," he said. "Last month I notified the party that it will be repaid. We are now in the period where it is due."

John Prescott, the Deputy Prime Minister, played down the potential impact of the pay demands. "We will meet our commitments; that is not a problem for us," he said.

Meanwhile, Scotland Yard has been urged to widen its investigation into the cash for honours case to examine whether seven criminal offences have been committed, including bribery and fraud.

Transparency International, an anti-corruption watchdog, has passed its legal analysis of the case to police.

The row has renewed the government's interest in reforming the House of Lords. Peter Hain, the Northern Ireland Secretary, confirmed that MPs would have a chance to vote on a "great reforming bill" on the House of Lords within the next session of parliament.
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