The Elephant in the Corner

Religion and Politics – anything for a quiet life

Posts Tagged ‘Co-Operative Bank

Let’s get this party started! – Part 1: The Labour Party

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In my last post “Who Pays the Piper?“, I indicated that political party funding would be where the real story of this election’s aftermath can be found, and said that somebody should take a closer look. Naturally, almost nobody wants to – certainly not my MP Humfrey Malins, who has never breathed a word on the subject in our long exchanges of emails. Not even when explicitly invited to do so.

Naturally, the mainstream media know their master’s voice, and also keep well away from the subject. As far as the general public is concerned, party funding is kept under wraps behind a wall of silence – which is pretty ironic considering that everything everyone needs to know is actually already in the public domain. Yes that’s right, folks, you can Google for it if need be. Even a professional journalist could find it – but of course they know their editors won’t publish anything they find, so that’s that.

Or is it? I think not. Let’s take a closer look at the finances of the Labour Party for starters. You may have heard Labour’s next big idea – that the banks should provide “a basic bank account” for everyone in Britain. Those of you with longer memories may recall that this socialistic holy grail wiped out the profitability of the Post Office back in the 1990’s. Millions were spent on (yet another) government-backed IT system that never saw the light of day.

This time round, the idea may well have some prominent backing. Why do I think so? Well, why else would the Co-Operative Bank plc have provided yet another £2 million credit facility to the Labour Party on 28th September 2009 at Base + 3%, to be repaid (or at least “reviewed”) on 31st October 2010? This facility appears to be entirely separate from the “Long standing” £2,610,000 credit facility at Base rate + 2% which is “reviewed” each June and December. Let’s face it, that sort of money can get one an awful lot of (behind the scenes) access – with or without the help of Stephen (“Taxi!”) Byers.

But the ones that really bother me are the names we hear of rather less. For instance, Unity Bank has a “long standing” credit facility of £1,540,000 available to Labour at “Unity rate + 2%”. Who or what is this bank? What does it (or perhaps more precisely, its directors) get in return for this kind of largesse? I’m guessing that a rocket salad with Alastair Darling doesn’t quite cover it.

And then there are the notable individuals. I have no problem at all with individuals donating their own money to causes they believe in – but I get a little jumpy about them offering large, open-ended loans, especially of the interest-free kind. If party supporters don’t want money in return for their loan, what do they want? If they don’t want anything, why not just make a donation and have done with it? And what about people who might be using proxies to make party donations (as suggested by the repeated £30,000 loans via from former Labour Party apparatchik Margaret McDonagh)?

Take for instance Dr. Chai Patel CBE. On 20th July 2005, Dr. Patel loaned £1.5 million to the Labour Party, interest free until 31st July 2010 and at 6.5% per annum thereafter. The loan is due to be reviewed on 30th September 2015, and let’s not forget that 5 years interest free is not to be sniffed at in any circumstances (especially when interest rates were higher than they are today). What kind of influence might this loan have obtained for Dr. Patel between 2005 and 2010? The short answer is that it very nearly got Dr. Patel into the House of Lords… before landing him in all sorts of hot water. You can read all about it here

You might respond that Dr. Patel’s cause is politically dead in the water. But can the same be said for the directors of Teescraft Engineering Limited? The company lent the Labour Party £20,000 interest free indefinitely on 31st July 2008. Something tells me we haven’t heard the last of either the company or its directors, and I will return to this subject in due course. Next time we’ll be looking at Conservative Party finances, but for now, let me leave you with a follow-on from last time’s closing statement.

When he who holds the gold makes the rules, those with rule-backed guns have two choices. They can either grab the gold and write their own rules, or carry out their orders. Either way, the general public have three choices: submit, resist or leave. You might call that democracy. I couldn’t possibly comment.

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Written by salternlight

March 23, 2010 at 6:47 pm