Probe launched into Tory party funding

PUBLISHED: 18:15 23 February 2009 | UPDATED: 22:14 26 October 2009

Mike Hobday: 'What stake does Lord Ashcroft have in Welwyn Hatfield election?'

Mike Hobday: 'What stake does Lord Ashcroft have in Welwyn Hatfield election?'

A PAYMENT of £15,000 made to Welwyn Hatfield Conservatives is among donations totalling nearly £5m that are being investigated by the official elections watchdog. The Electoral Commission has launched an inquiry into donations made to the Tories by Bearwo

A PAYMENT of £15,000 made to Welwyn Hatfield Conservatives is among donations totalling nearly £5m that are being investigated by the official elections watchdog.

The Electoral Commission has launched an inquiry into donations made to the Tories by Bearwood Corporate Services.

The company, owned by the party's deputy chairman Lord Ashcroft, has handed over £4,736,297.42 since February 2003.

This includes a one-off payment of £15,000 to Welwyn Hatfield Conservative Association on April 15, 2005.

To be eligible to make donations to a political party, a company must be registered in the UK and operate its business here.

In this case, the legality of the payments has been questioned due to confusion over the tax status of Lord Ashcroft, who was raised in the former British colony of Belize and is understood to have extensive business interests in the country.

Conservative Central Office described the donations as both "legal and permissible".

Welwyn Hatfield party agent Benedict McAleenan said: "Some time before the last election the local party received a donation from a company owned by Lord Ashcroft.

"As with all donations, it was checked with two strict tests: is the company registered in the UK and is it actively trading in the UK?

"That's what the law says should happen."

He added: "Our compliance department at head office was satisfied both tests were met fully, so the donation was accepted."

However, Welwyn Hatfield Labour party candidate Mike Hobday said: "I am surprised the local Conservatives would take money from such a controversial source.

"This is very different to donations being made by local people who obviously have an interest in who the MP for Welwyn Hatfield is.

"What stake does Lord Ashcroft, based in Central America, have in the outcome of elections in Welwyn Hatfield?"

Mr Hobday added if the Electoral Commission finds the donation to be in breach of legislation, he would expect it to be repaid.

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