Labour income from unions below 50%

More than half the Labour Party's income now comes from sources other than the trade union movement.

Figures released yesterday by the party in advance of the publication of the annual report in two weeks' time show that in 1996, 54.8 per cent of the party's income of pounds 17.1m came from individuals and fund-raising rather than the trade unions, the traditional source of income. This is the first time in the party's near century of existence that trade unions have not been the source of over half its tincome, but with 45 per cent still coming from unions, Labour is still highly dependent on their goodwill especially as its current overdraft stands at pounds 4.75m.

Figures for 1986, also a year preceding an election, show that 77.1 per cent of income came from trade unions and only 2.1 per cent from fund- raising compared with 36.9 per cent in 1996.

Labour's income increased dramatically from pounds 12.5m in 1995 to pounds 17.1m, helped by the use of professional fund-raising agencies who, on a commission basis, ring party members to contribute to party funds. Labour says that it now receives pounds 5m per year in standing orders.

It still receives relatively little in direct donations from business but it raises considerable sums from letting out space at its annual conference and from pounds 500 a head corporate dinners.

The release of the figures was designed to take the heat of Labour following the debacle over the shareholdings of Lord Simon, the former BP chairman and now a junior minister at the DTI. Labour said that when it publishes the full figures later this month, they will reveal the identity of any donors of sums over pounds 5,000. However, the figures will not reveal amounts given to the so called "blind trust" used to finance Tony Blair's office when he was leader of the opposition and set up by Michael Levy, the music producer and Mr Blair's tennis partner who was made a peer in the recent honours list. In a further move to deflect criticism of Labour's financial affairs, the chairman of the Parliamentary Labour Party, Clive Soley, wrote to William Hague asking him whether he had taken any action over Conservative Party funding.

Mr Soley said: "Aside from a vague promise to ban foreign donations and reveal the names of major donors we have no clear sign that you are determined to clean up the taint of dishonesty that covers Tory party funding."

Mr Soley said that there had been an increase in "loans payable" of pounds 3m in the latest Tory accounts and an increase in donations from pounds 12.7m to pounds 18.8m, "the vast majority of which cannot be traced from any known UK source". Mr Soley also said Mr Hague should return the pounds 360,000 donated to the Conservatives by fugitive Cypriot businessman Asil Nadir.

Conservative Central Office rebutted Mr Soley's remarks, saying that Mr Hague had already created a board of treasurers to oversee the opening up of the party's funding.