Conservative party PM David Cameron visits Canary Wharf
Hedge funds, financiers and private equity firms contributed more than a quarter of all donations to the Conservative party in the past year.
The latest research from the Bureau has mapped for the first time precisely which business sectors contributed to the Tories in the year ending June 30.
Our trawl of 450 separate donations given to Conservative Central Office by individuals, companies and limited liability partnerships reveals that 27%, or £3.3m, of the £12.18m donated to the party came from hedge funds, financiers and private equity firms.
The findings come amid growing concerns that some parts of the financial sector, termed ‘asset strippers’ or ‘predator financiers’ by some commentators, profit from financial instability.
The Bureau’s investigation, on the eve of the Tories annual conference in Manchester, shows the proportion of donations to the Conservatives from the entire financial services sector has now reached 51.4% – up 0.6% from last year. This means the City’s financial influence over the Tories has deepened in the past 12 months.
Our analysis also shows:
- Fifty City donors paid over £50,000 in the 12-month period covered by our study – which would gain them a face-to-face meeting with David Cameron as possible members of the Conservative party’s Leader’s Group.
- The hedge fund industry, the largest contributor across all business sectors, donated £1.38m (11.4%) to Central Office. Three individuals (Michael Farmer, Lord Stanley Fink and Andrew Law) contributed a combined total of £636,300.
- Financiers were the second-biggest group of Conservative Party donors from all business sectors, accounting for £1.3m. The top financier donor was David Rowland, who contributed £1.16m and is linked to Banque Havilland and hedge fund Blackfish Capital Management. Private equity financiers, such as Alexander Knaster and Edmund Truell, gave £565,400.
- Outside the City, the sector that donated the most to the Conservatives was industry, including manufacturing and defence. This sector contributed £913,411 (7.5%). The biggest donation from this sector was £300,000 and came from JCB Research.
- A commitment to reduce corporation tax from 28% to 23% by April 2014 for companies whose annual profits exceed £1.5m.
- Exempting UK resident companies from corporation tax on all profits for their foreign branches.
- A reduced tax rate to 5.75% on the treasury functions of large corporations in tax havens.
- Reducing stamp duty tax for bulk purchases of residential property.
- Planning reforms that propose to create a presumption to approval for schemes that are considered ‘sustainable’.
- A firm commitment to oppose a Europe-wide financial transaction tax.
Dr. Stuart Wilks-Heeg, executive director of Democratic Audit, which monitors the state of democracy in the UK, said: ‘The coalition agreement included clear undertakings to take big money out of politics but there appears to be no sign of this happening. What this study tellingly reveals is the scale of the Conservative party’s reliance on a variety of City interests at a time when the Conservative-led government is attempting to kick banking reform into the long grass.’
Conservative party funding, like that of the Labour party, has seen a dramatic fall from last year, which covered a 10-month general election campaign. The Conservatives have seen a £21.94m fall in donations from the same period last year.
While the Conservative party is now reliant on the City for the bulk of its money, trade union funding now accounts for 91.3% of cash and non-cash donations to the Labour party’s central office, up from 59.9% in the year up to June 30 2010, according to the Electoral Commission.
As donations from the financial services sector to the Conservative party have risen, Labour’s support from companies and individuals has fallen sharply since Ed Miliband came to power. Between July 2001 and June 2010, private donations accounted for between 31.5% and 43.1% of party cash. Since July 2010, that figure has nose-dived to 6.6%.
Additional reporting by the Bureau’s political party funding team – Lucy Keating, David Pegg, Maeve McClenaghan and Emma Slater.
Sign up for email alerts from the Bureau here.
October 1st, 2011 at 9:34 am (#)
This is a great piece of research – the kind of facts we really need to know. It would be useful to have some kind of elaboration on who these people are and what they do (eg Michael Farmer, Lord Stanley Fink and Andrew Law) and maybe some interviews with party donors talking about why they do it (so we can decide for ourselves if their motives sound convincing!) Perhaps this isn’t your job as investigative journalists, but I’d like to read such an article, if anyone from other outlets is going to get to work on your material…
October 1st, 2011 at 4:42 pm (#)
Very interesting. So, 51% of Tory funding is coming from the financial services sector, which is costing the UK billions every year in tax evasion and tax avoidance schemes particularly through the City of London, one of the world’s largest tax havens and overseers of the shadow banking system. It is clear the Conservatives will act against the public interest at every opportunity.
October 1st, 2011 at 4:46 pm (#)
Good work.
The Tory lead governmnet have shown they are reluctant to take on the banks and the Financial Sector in the City of London.
Even though David Cameron has promised to track down those bankers who have cheated there is scant evidence the Government have any real appetite for taking on the powerful Financial Insitutions.
Like in the US these firms are hugely powerful and spend millions on lobbying politicians and decision makers.They will do anything to preserve their ability to operate the way they desire ,to fight effective regulation;and award themselves obscene rewards.
In the US at least the SEC is taking on the Wall St firms for market abuses during the Mortgage sub prime fiasco ;the FSA over here appear to be sitting on their hands.
In British Retail banking why is it that not one senior banker has been charged with breaking regulatory law in the PPI mis-selling scam?
Why was Eric Daniels and Helen Weir of Lloyds Bank not been asked to account for their firm extensive mis-selling?Their bonuses were partly derived from this scandulous mis-selling.
I used to work for Lloyds Private Bank and Wealth Division and came across some very questionnable practices and in trying to report my concerns I was fired for my troubles.
I am fighting back and have set up a whistle blowing website ;-
http://www.dontbankonlloydsethics.com
Week by week I am exposing what I experienced working for Lloyds Bank.
It is not a pretty story with a happy ending.
October 1st, 2011 at 10:25 pm (#)
Can someone explain if it is BIJ editorial policy to refer to the Conservative Party as the Tories? Do you routinely refer to the Labour Party as the Socialists or do you just reserve pejorative terms for one party?
Thank you for pointing out that the Labour Party is significantly more dependent on one narrow group than the Conservatives who still get about half of their incomes from little people like me.
(Editor’s note: a cursory glance show that the following papers use the word ‘Tory’ or ‘Tories’ this weekend to describe the Conservatives – the UK Press Association, the Telegraph, the Guardian, BBC News, AP, Bloomberg, Herald Scotland, the Mirror, The Independent… the list goes on for another 800 odd articles. It is not pejorative and is not used as such.)
October 3rd, 2011 at 8:37 pm (#)
Phil it goes without saying that labour is funded by the trade union movement,after all they were the founders of the party its also so that any one who joins a union is given the choice as to whether they wish to pay the political levy or to opt out.much more democratic than the millions handed over by the CEOs.often with no referal to shareholders and often under a cloak of secrecy.
October 4th, 2011 at 10:53 am (#)
This research is excellent but someone please tell me what we can do about this corruption.