Major donors call on Rishi Sunak to reform political funding system

Major donors from across the political spectrum have called on Rishi Sunak to reform the system after accusations of a lack of transparency around the flow of cash into Westminster.

Alexander Temerko, a Ukraine-born businessman who has given more than £1m to the Conservatives, said “corrections” were needed, while others called for an inquiry into the rules around political donations.

Chris Bryant, the chair of the Commons Standards Committee, called for a system that had “full, not cloudy or murky transparency”.

It comes after the prime minister warned MPs on Monday that they would have to “justify” all the money they accepted to their constituents and as Downing Street said politicians “should be in no doubt that the public will pay close attention”.

The reform calls came after it emerged that some businesses have donated significant amounts to individual MPs despite having no employees or operating from apparently empty offices, according to an investigation by Sky News and the Tortoise website.

The government of Qatar was the fourth-biggest donor, with its Ministry of Foreign Affairs giving nearly £250,000 worth of benefits in kind, Sky reported.

Asked if it was right that “companies that don't seem to exist” could donate to MPs, Mr Sunak said: “I think transparency is really important for the healthy functioning of democracy.”

He also warned it was important that MPs keep to strict rules on outside incomes after it was revealed that Theresa May was one of the highest earners in parliament, alongside shadow foreign secretary David Lammy, despite Labour leader Sir Keir Starmer’s opposition to MPs having second jobs.

Asked about companies that appear on the register, No 10 said that every MP “should be in no doubt that the public will pay close attention to that and they will obviously need to justify that to their constituents”.

Donations to political parties and individual politicians were “an essential part of the electoral process and the UK democratic institutions,” Mr Temerko told The Independent.

But he said the system had “loopholes”. He proposed an “all-party board of donors as a permanent, rotating expert group that could potentially propose some changes to the donation system and would also continuously monitor emerging conflicts and major public issues in individual cases – like something that is legal but perhaps not entirely ethical”.

Stephen Gosling, who has given £390,000 to the Lib Dems since 2019, called for an inquiry into the system but said it should be led by the public, not politicians.

“If it was led by politicians it would say ‘everybody could secretly give us millions and millions’,” he said. “Everybody has got a vested interest, apart from the public”.

He suggested that an inquiry could be in the form of a “citizen’s assembly”. He also called for a body, such as the Electoral Commission, to be charged with running a searchable database on the money going into Westminster, similar to the one created by Sky and Tortoise.

His call for an inquiry was backed by Tom Brake from Unlock Democracy, who said: “Some companies, donating large amounts to different politicians … reveal little or nothing about where donations come from. This has to change.”

The “Westminster Accounts” probe found that the third-biggest overall donor to individual MPs since the last election was a company called MPM Connect Ltd which is registered to an office in Hertfordshire with no website and, according to its accounts, no employees.

The company gave a total of £345,217 to three high-profile Labour MPs – shadow home secretary Yvette Cooper (£184,317), shadow health secretary Wes Streeting (£60,900) and former mayor of South Yorkshire Dan Jarvis (£100,000), Sky reported.

Ms Cooper later clarified that the money came from a long-standing Labour donor, who also used to donate to the Conservative Party.

Her spokesperson said that MPM Connect was an investment company in the employment sector owned by Peter Hearn, “a UK businessman and long-standing Labour supporter”.

“It has all been fully declared and compliant with all the rules.”

They added that MPM Connect was registered to their “accountant’s office, as is made very clear in its Companies House entry”.

Mr Jarvis issued a similar statement and said the money had been used to help run his offices in Barnsley and Westminster and “to provide a better service to my constituents”.

MP Christian Wakeford, the Bury South MP who defected to Labour early last year, told Tortoise he had not heard of IX Wireless, one of the top 15 biggest political donors apart from trade unions, until weeks after he received a donation.

He said he had been asked to put together a proposal to receive funding through the group of Tory MPs known as the Northern Research Group.

“The first I ever heard of IX Wireless is when I was told ‘this is something you need to put on the register of interests for compliance purposes’ – that was all I ever heard of them,” Wakeford told the website.

Tortoise reported that the company’s Blackburn premises, listed as the company’s head office, appeared to be unoccupied and letters sent there were returned to sender. The company did not respond to Tortoise’s requests for comment. The Independent has approached the company for comment.

A Conservative Party spokesperson: “The Conservative Party only accepts donations from permissible sources, namely individuals registered on the UK’s electoral roll or UK-registered companies. Donations are properly and transparently declared to the Electoral Commission, openly published by them, and comply fully with the law.

“The only alternative to private fundraising for political parties is the diversion of resources from public services like schools and the NHS to pay the salaries of professional political campaigners and spin doctors.”

Downing Street declined to comment further.