Levy to Labour: end union reliance
Labour's chief fundraiser under Tony Blair calls for cleanup of system including public funding for parties and cap on donations
The man who ran Tony Blair's fundraising operation has urged Labour to cut its "umbilical cord" with the trade unions and accept major reforms to party funding.
Lord Levy called on an inquiry into party funding to "clean up" the system to end Labour's reliance on unions and all parties' pursuit of big donors by capping donations and introducing state funding.
He said the public had not "squealed" when public funding for the leader of the opposition's office was increased and nor would they if parties became principally publicly funded.
"There is only one way you are going to stop these question marks and there are question marks and it is undoubtedly an issue that will continue to cause problems, cause friction and cause questions and that is if there can no longer be large donations to political parties," Levy said.
He said unions should act as conduits for small political donations, but when members ticked a box to pay the levy they should be able to choose which party received it or none at all. At the moment the unions decide to whom they donate, and the vast majority goes to Labour.
Levy, a self-made millionaire and close friend of Blair, acted as the party's chief fundraiser and then was Blair's special envoy to the Middle East until 2007. He was embroiled in the cash-for-honours row at the end of Blair's premiership when he was arrested twice; no charges were brought.
Levy was giving evidence to an inquiry by the committee on standards in public life into party funding, which has been set up to form the basis of new cross-party talks later this year. Previous talks on funding have collapsed because Labour and the Tories could not agree on whether to sever the link with unions, or cap donations and spending.
There now appears to be cro! ss-party appetite for reform, but the main stumbling block is perceived to be getting the public to agree to a cash injection in politics when spending is being reduced elsewhere. The government's coalition agreement said: "We will also pursue a detailed agreement on limiting donations and reforming party funding in order to remove big money from politics."
Levy told the committee that people donated in order to meet politicians so they could name-drop to their friends, but they never received commercial benefits from the meetings and peerages were never linked to donations although it would be "naive" to believe it never occurred to donors. He said the reforms could and should be put in place before the next election.
Lord Sainsbury, one of the Labour party's biggest donors who was later appointed to the government as a science minister echoed Levy's calls for reform to cap donations and expenditure. He suggested parties could be approximately 85% publicly funded, which would cost taxpayers roughly 50-60m a year.
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