Funding loophole 'will close'

Unionist and Conservative politicians want the loophole closed

A loophole which allows political parties in Northern Ireland to raise money abroad will be closed, the government has confirmed.

The minister with responsibility for the funding of political parties, John Spellar, said the exemption should end when the current one expires next year.

Mr Spellar's statement sets out that the exemption will end in February 2005.

He said the decision takes into account the changed political landscape since the exemption was first made.

Mr Spellar, who was responding to a written parliamentary question on Thursday, said the decision was taken following consultation with the political parties in the province and with the Irish Government.

Four years ago, the law was changed to prevent parties from accepting donations of more than £200 from donors who were not UK-based individuals or companies.

Northern Ireland parties were exempted from these restrictions, mainly because of the importance placed by nationalist politicians on the ability to raise funds in the Irish Republic and further afield.

Anonymous donations

The minister says that there is a reasonable demand in many quarters for greater transparency and accountability - but that that must be set against the continuing fear of intimidation and Ireland's special role in Northern Ireland's political life.

It is not yet clear whether Northern Ireland parties will still be allowed to maintain the anonymity of financial donors - or to continue to fundraise in the Irish Republic.

There will be a consultation on these two issues with the government inviting submissions to arrive before the end of June.

Sinn Fein's Mitchel McLaughlin said the decision was a "further attack on the democratic process".

"While the proposed changes will have little or no effect on Sinn Féin's international lobbying and publicity operations, it is nonetheless further evidence of just how far the British government is prepared to go in attempts to restrict Sinn Féin's growing influence," he said.

Alliance leader David Ford said his party had been pressing the British and Irish governments to introduce parallel legislation which would allow properly accounted for political funds to be transferred between the Irish Republic and Northern Ireland.

Mr Ford said this would mean that parties which operate on both sides of the border would have to declare their fundraising to the relevant authorities, but once they had done this they could move the money as they see fit for legitimate purposes.