Blair 'open to debate' on funding

David Blunkett says state funding "inevitable"

Downing Street has stopped short of endorsing comments by senior Labour figures backing state funding for political parties.

Home Secretary David Blunkett indicated that he believed the state funding of UK political parties was inevitable.

People are saying we're in the pockets of business

John Prescott

He was speaking on the day Deputy Prime Minister John Prescott renewed his backing for state funding arguing it was the only way to make the political system "properly accountable".

The Conservatives said full state funding of political parties was "undemocratic and inneffective".

And they accused Labour of being "obsessed" with throwing taxpayers money at problems.

'Complex' issue

The row come amid a fresh wave of sleaze allegations against the Labour Party.

A spokesman for Tony Blair said the funding issue was "complex" and required a cross-party consensus before progress could be made.

He added that there was an ongoing debate in all the parties at the moment.

The Electoral Commission would be looking at the issue and the prime minister was was "happy to let that debate go on".

Unions

Mr Blunkett said political parties could not fulfil their democratic function without money.

"I think in the end if people are going to ridicule anyone and suspect anyone who gives funds to political parties we end up with the inevitable," he told BBC Radio 4's Today programme.

Mr Prescott told The Times that fending off allegations of sleaze attached to large political donations "is a problem for us".

"If the finance comes from the unions everyone says we're are in the pocket of the unions," he told the newspaper.

"Tony Blair has changed a lot of that and we're now getting contributions from business.

"But people are now saying we're in the pockets of business and implying all kinds of things."

He said political parties had to be financed somehow and there was "nowhere in the world" where funding came entirely from membership subscriptions.

"I think the only system under which you can be properly accountable is state financing within set limits of expenditure and advertising," Mr Prescott said.

Sleaze allegations

Shadow Cabinet Office minister Tim Collins said state funding of parties was "neither inevitable nor appropriate".

The public do not want yet more promises from Labour that they will be virtuous in the future

Tim Collins, shadow cabinet office minister

He said it "tackles none of the root causes of the scandals over Labour fundraising".

If Labour wanted to "clean up" politics it should set up an independent body to investigate allegations of impropriety, Mr Collins said.

He said he had written to the Committee on Standards in Public Life asking them to consider an independent review mechanism for political donations.

"The public do not want yet more promises from Labour that they will be virtuous in the future.

"We want to know what they have been getting up to in the recent past and what they are trying to get away with now," he said.

'National security'

Labour has been dogged by sleaze allegations since, amid public pressure, it decided to return a £1m donation from Formula One boss Bernie Ecclestone, after motor racing gained a stay of excecution from a ban on tobacco advertising.

More recently there was the row over steel magnate Lakshmi Mittal's £125,000 donation.

And over the weekend, fresh controversy grew over the £32m contract for smallpox vaccine given to a Labour donor without putting it out to tender.

F1 boss Bernie Ecclestone's donation caused an uproar

The government has defended awarding the contract to Powderject Pharmaceuticals, headed by Labour donor Paul Drayson.

It says the process used was necessary in the interests of "national security".

Health Secretary Alan Milburn said PowderJect was the "only company capable of supplying the appropriate vaccine in the appropriate time to ensure the right protection for the British people."

Labour party chairman Charles Clarke said the party had never allowed donations to influence policy.

But he said it was considering, as part of its rolling policy review, whether there was a case for more extensive state funding of political parties.

Labour made political donations transparent when the party came to office by setting up a statutory register of gifts to parties.