At root, Miliband's Party problem is our problem too

By Paul Goodman
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Ed Miliband displays what child psychiatrists call a "pattern of behavior".  Confronted with a problem he can no longer avoid, he moves late and does little, a response that voters have seen again and again.  First on immigration, then on welfare, then on borrowing, he has half-closed the door on Labour's respective problems - wanting to let in lots of immigrants, soak taxpayers for lots of welfare, and borrow lots of money on the never-never - thereby inviting his left and the unions to push it open again.  "Weak weak weak" comes the cry and the briefings from Downing Street and CCHQ, and they are as right as they are repetitious.

His speech today on Labour and the unions offers more of the same.  No-one anywhere - not Polly Toynbee, not Owen Jones, not Laurie Penny - believes he would be making it were he not in a hole and trying to dig himself out.  It follows that the proposals in his speech won't have been thought through, and that as an answer to Labour's problems it will only pose further questions.  These will duly be asked by Grant Shapps, Dan Hodges, this site and many others, keeping the Unite story on TV and in the headlines as the summer days stretch gloriously on.

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Michael Hintze deserves his knighthood

By Harry Phibbs
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Congratulations to Michael Hintze who has been awarded a knighthood. Mr Hintze is very rich - a billionaire if measured in US dollars, although probably not quite in terms of sterling. His hedge fund CQS is among the top perfomers in the world. This is a success not just for its investors but also for the rest of us, helping to create jobs and wealth around the globe.

Mr Hintze was ahead of the pack in warning that the scale of toxic debt due to sub-prime mortgages meant some UK bank balance sheets were less than solid. A pity more people didn't listen at the time.

It is not surprising that Mr Hintze takes an interest in politics. His family were refugees from Communism - twice. His grandparents fled Russia after the 1917 Bolshevik Revolution. To escape Communism they went to China. Whoops. Michael was born in the Chinese city of Harbin. Again a Communist takeover prompted a departure and so he grew up in Sydney.

With his wife Dorothy he has set up the Hintze Family Charitable Foundation. It has made donations of over £30 million in recent years - £1 million to the Old Vic, £2.5 million to the Nation Gallery, £3 million to Wandsworth Museum which was saved from closure. In fact Wandsworth has done particularly well out of him - he is a local resident and is fond of the borough. A new inpatient centre at the Trinity Hospice there is another cause he has supported.

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New Tory rebellion after advisers to ministers are asked to share bedrooms at party conference

By Tim Montgomerie
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I'm not sure if it's a sign of the difficult financial position facing the party or a sign of financial responsibility but the Special Advisers to Tory ministers are furious that they are being asked to share hotel rooms at this year's Birmingham party conference. Some have threatened not to attend if they don't get a room of their own.

Last year ConHome noted the huge cost of attending party conference since the move from seaside resorts to major cities. It appears that the party is now feeling the pinch too.

Tory MPs shouldn't vote for more state funding of party politics

By Tim Montgomerie
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On Telegraph blogs yesterday Ben Brogan suggested that David Cameron might try to resurrect the boundary reforms by offering the Liberal Democrats a deal on party funding. This might, for example, involve extra state funding for political parties in return for a cap on big private and union giving. The Tory leader might have a double motivation for this. The latest Electoral Commission figures confirmed rumours that the Conservative Party is finding it much harder to raise funds. The steep decline in Tory membership is also a problem for Tory coffers.

I don't, however, think this is even a starter. Nick Clegg has been very clear that his party won't now support boundary reform. This is partly because of petulance at the Tory Lords rebellion but also because boundary reforms will hurt Lib Dem MPs. As many as five LIb Dem MPs may lose their seats because of changes to constituency boundaries. I doubt that Cameron could get Tory MPs to vote for more state funding of political parties either. The rebellion might not be as big as against the Lords Bill but I wouldn't be surprised if it was very substantial.

If Britain did embrace greater taxpayer subsidy of political parties it would probably introduce a per-vote-grant. This would mean, for example, that parties would get an annual sum for every vote they got at the previous election. If it was £1-per-vote the Tories would get £10,703,654 per year. If it was 50p-per-vote it would still be over £5 million. In a time of austerity are the British people going to support that? The other objection to this model is that it entrenches incumbency. It gives existing parties an advantage over new, insurgent parties. That's a barrier to entry that Conservatives should oppose. And who gets the money? Every party or those just with MPs? If it's every party then the BNP could get a big public subsidy.

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It's a crisis? Send for Fallon!

By Paul Goodman
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Michael Fallon's long media weekend began last Saturday afternoon when he got early notice of the Sunday Times's Peter Cruddas expose, and it ended last Monday evening with a Jeremy Paxman interview on Newsnight.  Between the two, Fallon was grilled by Andrew Neil on the Sunday Politics, Dermot Murnaghan on Murnaghan, Jon Snow on Channel Four News...a strike force of interviewers as fearsome as the famous 1970s quartet of West Indies bowlers - plus others.  Nor this long innings unique.  During the run-up to the budget, Fallon was crouching at the crease; as the Leverson enquiry loomed, Fallon was at the wicket.  The MP for Sevenoaks is the Conservative Party's man for all media seasons.

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David Cameron announces investigation into cash for access allegations will be led by Lord Gold

By Matthew Barrett
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Before giving a speech to launch extra NHS spending on dementia, David Cameron addressed the resignation of Conservative Party co-Treasurer Peter Cruddas, and announced the details of an internal inquiry to investigate the allegations made of donations for access to Downing Street:

"We have a robust and sensible system for raising money in the Conservative Party. All donations to the Party centrally above £7500 are declared to the Electoral Commission and must comply with UK Electoral Law. No donation is accepted before thorough compliance procedures have been gone through. But as I said yesterday, in the light of these events, I have ordered a full Party inquiry. This will be led by the Conservative peer Lord Gold, a distinguished lawyer and a former senior partner at Herbert Smith."

The Prime Minister then said that there have been three times when "significant donors" have had dinner at Downing Street:

"In the two years I have been Prime Minister, there have been three occasions on which significant donors have come to dinner in my flat. In addition there was a further thank you dinner, which included donors, in Downing Street itself shortly after the General Election. We will be publishing details today. None of these dinners were fund raising dinners, and none of these dinners were paid for by the taxpayer. I have known most of those attending for many years."

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Cameron appoints Maude and Feldman to lead on urgent cross-party talks over political funding

By Paul Goodman
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I understand from senior sources that the Prime Minister has asked Francis Maude and Andrew Feldman to lead on urgent cross-party talks over political funding.

Number 10 obviously wants to take control of the party funding story before Ed Miliband does so: brother David led the charge for Labour on Marr this morning.

It is a predictable move: Maude leads on political funding from the Cabinet Office, and Feldman is the party chairman who deals with the fund-raising side.

David Cameron said earlier today that there will be an internal enquiry into the Cruddas affair.  I have a suggestion for it which I'll make later this afternoon.

Cameron must act quickly and introduce strict new caps on donations to political parties

By Tim Montgomerie
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• Sunday update: Peter Cruddas has now resigned.

The Conservative Party has always run donor clubs and members of the more expensive donor clubs get better access to leading Tories than people who belong to cheaper donor clubs. Rightly or wrongly this is how political funding has worked for a long time and we all kind of knew it. What the Sunday Times story and video has done is to pull back the curtain on the relationship between donations and access any no prizes for predicting that the public will be disgusted.

The matter of accessing Downing Street: There will be particular concern that Peter Cruddas (the already outgoing Tory Treasurer who will now need to go more quickly) is appearing to sell access to Number 10 Downing Street and the Downing Street Policy Unit. It is one thing to offer access to the Tory leader in Tory HQ and to be able to influence the Tory policy unit but it is quite another to offer paid access to Government property and employees. There is no evidence or allegation that any individual business or donor has profited from their connections with Tory ministers but the buying of access will still cause upset.

The new nature of Tory donors: David Cameron has succeeded in diversifying the party's funding base but many of the newest donors to the party are driven by a desire to be close to power rather than by ideological factors. At the height of New Labour's power the people who gave to the Conservative Party tended to do so for genuinely ideological reasons but many of these have drifted away in recent years (in protest at party policy drift on, for example, climate change, Europe and attitudes to Israel). They've been replaced with more power-seeking donors. I have to add, however, that in all of my experience every long-term donor to the Tory Party that I've ever met has had an interest in the Conservative Party's success as an ideological project and not as a vehicle for their narrow interests. Donors in this sense play a great public service and support for politics should be respected, not suspected.

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Sunday Times says Tory donor invites donors to buy meetings with Prime Minister for £250,000

By Tim Montgomerie
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Big story breaking tonight on front of Sunday Times. This is what we know...

• The already outgoing Tory Treasurer Cruddas has been filmed secretly by The Sunday Times offering secret meetings with David Cameron in return for a donation of £250,000
• Mr Cruddas was secretly filmed meeting undercover reporters who posed as overseas wealth fund managers who made it clear they wanted to build a relationship with the Prime Minister and other senior ministers
• Mr Cruddas promoted a “premier league” of donors for anyone making six-figure sums
• He apparently suggests that such a donation would enable donors to lobby the PM directly on business issues and ensure their views are “fed in” to the Downing Street policy machine
• Premier league donors can ask the Prime Minister “practically any question that they want”, says Cruddas, and also meet the likes of William Hague and George Osborne.
• He says that the access would be "awesome for your business".

Cameron must reject £100 million taxpayer bailout for political parties

By Tim Montgomerie
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On the front page of this morning's Guardian is the news that an inquiry is to recommend that political parties receive £3 for every vote they receive at a general election. Based on the outcome of the last election this would equal £32 million for the Conservatives, £25.8 million for Labour and £20.4 million for the Liberal Democrats - all paid for by the taxpayer. This would be a windfall for parties that are struggling to retain members but is likely to be very unpopular with voters.

The subsidy would be also be a quid pro quo for the introduction of a £50,000 limit on donations to political parties. Big government money would replace money from big donors and big unions. The Guardian tells us that "donations of £50,001 or more accounted for 41% of Liberal Democrat income, 54% of Conservative and 76% of Labour party declared donation income." The high Labour percentage is explained by Ed Miliband's chronic dependence on the trade unions.

There was talk of a £10,000 cap but the Tory Co-Chairman Lord Feldman has objected. He wrote to the inquiry arguing that "a cap of £10,000 would hugely inhibit the ability of political parties to engage with the electorate." It is, I think, precisely the other way round. A high cap and state funding will actually increase the remoteness of political parties from the electorate. Not only will state funding of existing political parties make it harder for small parties to flourish it will also reduce the need for political parties to connect with and understand the concerns of ordinary voters and turn them into armies of small donors.

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