political commentator * author * publisher * bookseller * radio presenter * blogger * Conservative candidate * former lobbyist * Jack Russell owner * West Ham United fanatic * Email iain AT iaindale DOT com
Thursday, February 22, 2007
UKIP Forced to Pay Back £367,000
Sky News are reporting that UKIP's finances are to be investigated by the Electoral Commission. There are some major discrepancies in their financial accounts and they have been ordered to pay back more than £367,697 of 'unacceptable donations' and fined £1,000 for the late filing of their accounts. I wrote about this back in January HERE. Natutally it was all dismissed as a storm in a teacup at the time. Rather like the LibDems dismissed the furore about Michael Brown. Which reminds me, I wonder how the Electoral Commission is getting on with that particular investigation...
Interesting because at the end of 2004, which is the last date for which they have published accounts, their cash stood at £32k. Most of their income in that year was received as donations-in-kind or services. Are they due for a name change to the UK Insolvency Party?
ReplyDeletePerhaps being a lunatic xenophobe and basic accounting skills just don't mix.
ReplyDeleteUtterly scandalous. Alan Brown's donations are to be repaid - not to Mr. Brown, but to the Treasury; so "pay back" is an inappropriate term - fine would be more honest. The reason for this? Mr. Brown was not on the electoral register. Big deal, neither was I at the last election when I turned up to vote, having forgotten to fill in the damned forms we seem to get every year. Mr Brown conducted his business in this country and paid his due taxes. This is a tenuous technicality and smacks of vindictiveness.
ReplyDeleteNo political party seems to manage donors cash with probity...how could we ever rust them with taxpayers' cash ?
ReplyDeleteThis is somewhat careless of them isn't it?
ReplyDeleteVery interesting, and it raises questions in my mind.
ReplyDeleteA mistake? A technicality? Fraud?
(by the way the questions above, lest there be any confusion, are related to the EU Accounts of these past ten or so years that that the auditors have refused to sign).
Still, thank you for reminding me to vote UKIP next time.
No wonder they want to change their name before the creditors call. What a shower.
ReplyDeleteAnd who was in charge of the south east accounts? Nigella Farago!
Why do parties require such large amounts of money?
ReplyDeleteIf you have well motivated activists you can run high profile campaigns at remarkably little cost.
The Save Bedford Hospital party has been set up and run for less than £200, yet we have received massive coverage on local radio, regional TV, and the local newspapers; not to mention that you can set up a web blog for free (www.vote4barry.blogspot.com)
What if UKIP do fold? Who would notice?
ReplyDeleteEven if UKIP were to disappear into bankruptcy, which I don't think it will, the Tories will not get those votes back, which is what they have been relying on in this interesting little campaign. If only Central Office would spend half the time it has spent on digging up dirt about UKIP on producing policies that would attract voters. Too much to hope for, I guess.
ReplyDeleteInteresting. £367K represents a considerable proportion of UKIP's entire donations over the last two years, and the accounts would seem to indicate that there is no way the party could repay all that at short notice. How did they mess up on such a scale?
ReplyDelete*Mark Williams, just to correct your 9:12pm, UKIP's 2005 accounts are now published, and available HERE (pdf file).
Just like Lab/Con, they're technically insolvent, but at least they seem to be retaining a surplus, they've reduced their net liabilities from over £100K (Dec.03) to under £50K at Dec.05. So they're moving in the right direction, financially (er, notwithstanding the substance of Iain's post!)
Also of interest is that between 2004 and 2005, UKIP benefited by £1.5m where third parties either provided goods or services to them free of charge, or else paid the bills for them.
UKIP's statement is here. The answer is that Alan Brown did not fill in his Electoral Register form and was thus not a UK citizen in 2005; since he has been a regular donor to UKIP over the kast few years, there was no reason for UKIP to suspect that there was anything amiss.
ReplyDeleteOh, and you asked about the investigation into Michael Brown? Well, it seems that the Electoral Commission isn't too worried about the £2.4m that he donated. Their statement is here.
"The Electoral Commission has previously made clear its view that it was reasonable for the Liberal Democrats - based on the information available to them at the time - to regard the donations they received from 5th Avenue Partners Ltd in 2005, totalling just over £2.4m, as permissible.
It remains the Commissions view that the Liberal Democrats acted in good faith at that time, and the Commission is not re-opening the question of whether the party or its officers failed to carry out sufficient checks into the permissibility of the donations.
...
It is not clear to the Commission that 5th Avenue Partners Ltd was carrying on business in the UK at the time the donations were made."
So, the LibDems receive £2.4m from the company (which may or may not be eligible to donate) of an overseas-resident convicted fraudster, and they can keep the money because they were "acted in good faith at the time."
UKIP's donor, resident and working in the UK all of his life (and not convicted of fraud), fails to fill in a form and the Electoral Commission demand that all of the money for that year must be repaid.
Oh, yeah, that's fair, isn't it?
DK
The more rules that are introduced, the more political enemies will waste time accusing each other of breaking them - just look at the appalling cat-fights that have occurred within, as well as between, Council Groups since the introduction of the Standards Board for Councils.
ReplyDeleteAnd why do Parties spend in such a profligate fashion? I suggest its because politicians have, in an odd way, to be fantasists, and gradually other people's money - whether that of donors or taxpayers - becomes an illusion. "I need it, so I will always have it" they persuade themselves, and because successful politicians have something of the snakeoil salesmen about them, many of us trot along behind them, attempting to make their dreams a reality.
I'm with Gary here. The law that was breached was brought in to prevent parties being funded by overseas interests.
ReplyDeleteBut the donor in question is not some sinister alien.... he's English, lives in this country, earns his living here and pays his taxes here, votes here. Through some or other oversight he got left off the electoral register for a period. You have to say.... so what?
Where is the sense of perspective here? Utterly ridiculous.
Well Iain, happy as you are, you are basically encouraging the use of a law meant to catch out foreign donations to political parties, like the Lib Dem scandal (the Lib Dems have been cleared of any wrongdoing, buy the way...)for someone who lost a small piece of paper shoved through his letter box with a load of junkmail.
ReplyDeleteJaw droppingly astonishing decision.
But hey, at least UKIP didn't do what the Tories did and snaffle a loan of £31k from one of its branches and then refuse to give it back...
@anon 12:00am
ReplyDeleteI totally agree with you.
Yesterday I enthusiastically endorsed Norris' view of a withdrawal from Europe and said the Tories would definitely get my vote should Cameron make it official party polic. In my view a lot of UKIP voters would vote Tory if the withdrawal policy was on the manifesto.
It DOES NOT mean that the Tories will get the votes 'by default' should UKIP disappear - that would be a miscalculation of the first order. The reason people are voting UKIP is because current Tory policies are seen as pandering to Europe.
For God's sake - I can see this is obvious and I don't have all the Big Brains at Central Office working for me...
sheesh!
BTW, if gary 9:44pm is right, then that is an odious practice indeed...
This reminds me of Singapore, where the ruling party emasculates/eviscerates the opposition financially. Frankly, it has all the hallmarks of that kind of behaviour.
ReplyDeleteThis is an abuse/misuse of the legislation by the Commission, IMHO. The rules were designed to trap foreign donors, not people who slipped off and then returned to the electoral roll. But what else do you expect from a Government infested with pettifogging lawyers?
Seeing as the donor was and is eligible, if the Treasury had any shred of decency it should pass the monies back to the donor and then they can decide if they want to re-donate the cash.
This is interesting although I think that UKIP are a bit like the bluebottle in your lounge, they make an irritating noise but are basically harmless. If the Conservative party goes chasing after a couple of hundred thousand UKIP votes rather than a couple of million floating/ex-Labour votes then they won't win an election and won't deserve to.
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteWell if the UKIP financial backer is a real supporter would he not only ensure that he completed his annual electoral registration form, which incidently, there is in theory a fine of £1000 for those who do not complete it.
ReplyDeleteHis local council would have only removed him, if he had not completed the form for two consecutive years. And where is the clerical erorr - surely that means a mistake when filling out a form - but this fantastic supporter did not even fill out the form, hardly a clerical error.
Mind you, there are super league backers of the Labour party who may be on the register of electors, but they never vote ! Strange that.
DK:
ReplyDeleteWhy did you miss off the end of the Electoral Commission's statement about the Lib Dems?
It is not clear to the Commission that 5th Avenue Partners Ltd was carrying on business in the UK at the time the donations were made. If not, then the donations were impermissible. Under Section 58 of the Political Parties, Elections and Referendums Act 2000, the Commission has the power to apply to a court for an order that the party must forfeit to the Consolidated Fund an amount equal to the value of any impermissible donation. We are considering the available evidence and expect to reach a decision on whether to apply for such an order in the next few weeks.
It appears that we are still in the period of "a few weeks" since last October.
The case against UKIP is clear. The donor was not on the electoral register at the time the donation was made - end of story. The case against the Lib Dems is different, the question is whether the company was engaged in business at the time the donation was made, a more subjective test. Many people, including the judge in the HSBC v Brown case think that the company was not engaged in business, and the burden of truth is strictly on the Lib Dems to show that the company was in business (so the Electoral Commission may have been a little lax in letting them keep the money at the time). However the Electoral Commission made it clear when they first that if any evidence came to light regarding the Brown donation that showed that 5th Avenue Partners was not in business, then they would review that position. They knew perfectly well at the time that Brown was being investigated by the police, so they clearly expected that such evidence might be produced. If there is a complaint about the Electoral Commission it is not so much about double standards, it is about acting so slowly against the Lib Dems.
I do not like UKIP but if it is right that this has only arisen because the donor, who was resident in the UK, failed to send back that wretched form to his local authority then there is something wrong here. The state confiscating the money is out of all proportion to the wrong.
ReplyDeleteWe seem to get similar problems arising where regulators have a financial interest in imposing penalties, the interst being that they rely on the penalties for their funding. Often the people who have lost out have to pay the disproportionate regulatory fine.
The only organisation that does not suffer under this oppression is HMG, which makes many more serious mistakes without any penalty.
I accept that market forces and regulation have made the private sector very efficient and generally well governed to the extent it is streets ahead of HMG; but we seem to be reaching a stage where a bloated inefficient HMG is funding itself by imposing disproportionate penalties on others, without any one regulating or controlling it.
Why do UKIP have on their NEC Mr Bown if he could not be bothered to vote in the general election of 2005?
ReplyDeleteIt is bizarre.
What use is a party led by people who do not vote?
hf-I think well find out (big time) at the next GE.
ReplyDelete"We are considering the available evidence and expect to reach a decision on whether to apply for such an order in the next few weeks."
ReplyDeleteIt appears that we are still in the period of "a few weeks" since last October.
Really? Few for me implies, three or four. Maybe even six.
We are a few months from last October. Or, if you prefer, we are now precisely 17 -- that's seventeen -- weeks from when that statement was issued in Friday 27 October.
DK
When the Tories bought the freehold for Smith Square for way below its market value (as evidenced by the massive profit they made a few months later) from an offshore company wasn't that also an impermissible donation under the Act. It is reported that the Electoral Commission have looked at the sale of the property and found everything above board - but have they looked at the purchase of the freehold.
ReplyDeleteUKIP are bang ot rights however - they didn't check what the Act clearly tells them to check.
rush-is-right 7:42 am
ReplyDeleteIMO he is a Sinister Alien!none of them is a normal.What sort of idiots vote for a party that brings about the exact opposite result to its purported aims?
Seems to me like the Electoral Commission have "done a Wimbledon" and imposed a punishment out of all proportion to the admitted but in all respects technical offence.
ReplyDeleteWimbledon, for those who haven't heard, were thrown out of two cup competitions and fined 18 points for not getting international clearance for a new signing. The foreign club in question ? Cardiff City of the errrr...English League.
http://news.bbc.co.uk/sport1/hi/football/eng_conf/6339377.stm
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ReplyDelete