Page last updated at 17:59 GMT, Friday, 20 November 2009

Ashcroft Tory donation probe 'could drag on'

Lord Ashcroft
Lord Ashcroft has become an influential figure at Tory HQ

The Electoral Commission has refused to say whether it will complete a probe into £5m of donations to the Tory party before the next general election.

The Unlock Democracy group says the probe into the gifts by Bearwood Corporate Services must not "drag on into the general election and beyond".

But the election watchdog said it would not speculate on when the investigation was likely to be concluded.

Bearwood is controlled by Conservative deputy chairman Lord Ashcroft.

The probe, which was launched in January following six months of preliminary investigations, is looking at whether Bearwood is "carrying on business in the UK" - a legal requirement for donors to British political parties.

The company, which has given £4.74m to the Conservative Party since 2003, is registered in the UK but Lord Ashcroft is known to have extensive business interests in Belize, a former British colony and tax haven.

The Conservatives have insisted the donations were "legal and permissible".

Lord Ashcroft was made a Conservative peer in 2000 after giving an assurance that he would pay UK taxes, but has since refused to discuss his tax affairs, saying they were private

If the watchdog ordered the Conservatives to repay the cash it would deprive the party of vital funds to fight the election campaign, which is widely expected in May.

Lib Dem ruling

It comes as the Electoral Commission completed a long-running investigation into a £2.4m donation to the Liberal Democrats by a company linked to a convicted fraudster, ruling that no regulations had been broken and that the party could keep the money.

Peter Facey, director of Unlock Democracy, a civil liberties pressure group, said: "We welcome the conclusion of this investigation as it means the Electoral Commission can now prioritise their investigation into Bearwood Corporate Services. It is a case of one down, one to go.

"This investigation cannot be allowed to drag on into the general election and beyond. We also find it ironic that the independent watchdog whose job is to ensure transparency in party funding hesitates to confirm publically who is in charge of the investigation."

An Electoral Commission spokeswoman said she would not speculate on when the investigation would be concluded, telling BBC News: "We are investigating the matter fully, as you would expect".

She said donations by Bearwood Corporate Services had been "under investigation for some time," but rejected comparisons with the Lib Dem investigation, saying "each case is different".

Lord Ashcroft has become a powerful figure at Conservative HQ, where he is credited with devising the party's marginal seat strategy, pouring resources into constituencies where Labour MPs are defending small majority.

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