Is our Party almost insolvent?

TrueLabour Tue Nov 28, 2006 at 06:29:48 PM GMT Print-friendly version Facebook

Three days ago Politicalbetting.com asked that question.   http://politicalbetting.com/index.php/page/2/

Today we have official Labour statements saying according to the BBC.  
"Labour said it was in the midst of a difficult financial year."   "two of our commercial loans from individual supporters had not been rescheduled and repayment is due".
 




" The party is in discussions with those two individuals as any organisation that is seeking to manage its cash flow in difficult circumstances would do."
"The individuals are understood to be Sir Christopher Evans, who is owed £1m, and Gordon Crawford, who lent £500,000. "
Yes the other parties have loans but the Tories still have a £30m asset to sell to reduce their £35m debt.

For our party it looks much more serious.  We have 2 loans that we need to pay but cannot and we also seem unable to borrow from other sources to cover the debt.   One article says that we have £14m due to pay over the next year.
One NEC Member says that "the NEC is personally liable for the debts". It is the lead story on Newsnight.


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Is our Party almost insolvent? | 23 comments (23 topical)

Re: Is our Party almost insolvent? (#1)

by Andrea on Tue Nov 28, 2006 at 06:43:45 PM GMT

All the loans to Labour can be viewed here:
http://www.electoralcommission.org.uk/regulatory-issues/labpartyloans.cfm

The situation in terms of loans for other parties is:
Conservatives: £35.3m
Labour: £23.4m
Lib Dems: £1.1m
SNP: £525, 393
Plaid Cymru: £352,000
Respect: £34, 878
UKIP: £19,200


Re: Is our Party almost insolvent? (#2)

by TrueLabour on Tue Nov 28, 2006 at 06:59:34 PM GMT

Thanks Andrea but can we keep the discussion to our party.   We are the only one that has had to state we have problems paying the loans that are due.


[ Parent ]

Re: Is our Party almost insolvent? (#3)

by swatantra on Tue Nov 28, 2006 at 07:13:10 PM GMT

I hate to say this, but how could the Party Treasurer allow this to happen. I know Dromhy wasn't kept fully informed about loans/donations but such a huge shortfall in the accounts should have raised some alarm bells. We were spending money like confetti at the last election and somebody is going to have to carry the can.


[ Parent ]

Re: Is our Party almost insolvent? (#4)

by TrueLabour on Tue Nov 28, 2006 at 07:24:07 PM GMT

Jack said that he did not know about them and was kept in the dark.   This has not been refuted by Tony Blair or Matt Carter.   So they seem to have known about it but Jack did not.   Ian Mc has also apparantley denied knowing who the individual donors were.

Channel 4 News tonight says that one of the donors Sir Christopher Evans, (owed £1m) has given the party 3 months to pay or it is implied that legal action will follow!


[ Parent ]

Re: Is our Party almost insolvent? (#5)

by swatantra on Tue Nov 28, 2006 at 07:36:39 PM GMT

We are in a sort of Catch 22 here. The 'loans' could be converted into donations, even at this late stage. Some of the lenders would have preferred to have given the money outright in the first place. But we can't declare these donations retrospectively! Especially with this Police Enquiry going on. What an abolute fiasco.


[ Parent ]

Re: Is our Party almost insolvent? (#6)

by Andrea on Tue Nov 28, 2006 at 07:52:25 PM GMT

I'm so sorry!
(Actually the first link it's just Labour related and it's the source of all Labour loans, who made them and the repayment date)


[ Parent ]

Re: Is our Party almost insolvent? (#7)

by Mark Wadsworth on Tue Nov 28, 2006 at 09:09:56 PM GMT

True Labour, what's the problem, if every Labour member stumps up £100 or so, that should cover it.


Re: Is our Party almost insolvent? (#8)

by TrueLabour on Tue Nov 28, 2006 at 09:22:31 PM GMT

Mark you must still believe in Father Xmas!

What does our Party Chairman have to say about these liabilities?   Surely she should be the one speaking to the Members about it?    

We do not even have the reassurance that the reasons we got into this mess have been tackled.

When is the next NEC meeting?


[ Parent ]

Re: Is our Party almost insolvent? (#9)

by swatantra on Tue Nov 28, 2006 at 09:34:42 PM GMT

I think I got a call from Hazel about a month ago asking me to increase my monthly DD to the Party; I did from £5 to £10 per month. Sorry its all I can afford at the moment Hazel! We've got along way to go before we pay off all those loans.


[ Parent ]

Re: Is our Party almost insolvent? (#11)

by Andrea on Tue Nov 28, 2006 at 09:40:04 PM GMT

I think the next NEC meeting is in January


[ Parent ]

Re: Is our Party almost insolvent? (#10)

by Juvenal on Tue Nov 28, 2006 at 09:36:44 PM GMT

How many of our members are able to cough up £100?  And how many would be willing to bail out the party, given it's got into this situation in the first place.

The question is - if you can no longer 'link' a place in the Lords with a loan, how many rich people will come forward to help the party?  


[ Parent ]

Re: Is our Party almost insolvent? (#12)

by Andrea on Wed Nov 29, 2006 at 09:04:36 AM GMT

It gets even more serious:
http://www.timesonline.co.uk/article/0,,2-2477253,00.html

How does the party got in such a mess and why were they allowed to do such a mess without anyone (or least many) realizing it sooner?


Re: Is our Party almost insolvent? (#13)

by TrueLabour on Wed Nov 29, 2006 at 09:47:09 AM GMT

The people responsible for this mess are Tony Blair, Matt Carter and the previous Chair Ian Mc and current Chair Hazel Blears.   Hazel has also been on the NEC for some while and yet she seems to be more focused on her own campaign to be deputy leader rather than "Chairing" the Labour party.

All Hazel says in the media is "look at the Tories...".    No Hazel we are looking at you and wondering just what do you do to properly Chair the party?

Since some of the loanees actually have said that they wanted to donate rather than loan the money,  it appears that the spin machine won over common sense.  

Guardian today says that it is £17m that needs to be repaid in short term.http://politics.guardian.co.uk/funding/story/0,,1959393,00.html
"Lady Prosser, a former party treasurer, told BBC Radio 4's PM programme: "It's hard to see where the money's going to come from. But someone has to pay something to enable democracy to flourish - political parties cost money to run.""


[ Parent ]

Re: Is our Party almost insolvent? (#14)

by CitizenAndreas on Wed Nov 29, 2006 at 09:53:20 AM GMT

I'm not sure if electoral law has been breached in this case. The law itself says little more than commercial terms.

This means that interpretation of the law is vague. Unsecured loans have been hovering around the 6% for a while, so I'm not sure how the reporter can suggest that high street buyers couldn't get a rate of 6.5%.

Since the law is not more specific about the commercial terms I would guess that Labour is in the clear for this.


[ Parent ]

Re: Is our Party almost insolvent? (#15)

by Glass House on Wed Nov 29, 2006 at 10:13:11 AM GMT

I agree. I wonder who the "financial experts" who have questioned this have links to the Tory party?


[ Parent ]

Re: Is our Party almost insolvent? (#16)

by NeilF on Wed Nov 29, 2006 at 10:39:33 AM GMT

What's interesting about this whole debacle is just how sidelined the NEC seem to have been in the strategic functioning of the party in recent years.  I hope that we'll never have a situation like this again.  Our next leader and deputy should restore some authority to the NEC, who are ultimately legally responsible for the financial welfare of the party and accountable to members.


[ Parent ]

Re: Is our Party almost insolvent? (#17)

by TrueLabour on Wed Nov 29, 2006 at 10:52:29 AM GMT

Spot on Neil.   The NEC really need to start holding the Leader and Chair to account.    At an earlier NEC meeting they were all told that the NEC members were personally liable if the Labour party defaulted so <u>they ought to be taking a very active interest in these matters!</u>

Sadly the reports from the Sept and Nov NEC meetings show few signs that they are spending much time on this matter and seem to be ignoring the personal financial risk involved.


[ Parent ]

Re: Is our Party almost insolvent? (#18)

by Mark Wadsworth on Wed Nov 29, 2006 at 03:46:10 PM GMT

BTW, the Labour Party is not "almost insolvent" it IS insolvent, its liabilities are much larger than its assets. Take it from a Certified Accoutants.


Re: Is our Party almost insolvent? (#19)

by MM on Wed Nov 29, 2006 at 04:15:30 PM GMT

Perhaps when Gordon takes over as leader, money will start flooding in from various 'City' sources?  I'm sure he will be appointing his own 'Lord Levy' to do his fundrasing.


Re: Is our Party almost insolvent? (#20)

by TrueLabour on Wed Nov 29, 2006 at 04:27:12 PM GMT

But Gordon cannot offer peerages now for the cash.

And he needs to keep the unions sweet as we rely upon them more than we did 10 years ago.

We also have to spend £1m on the leadership elections next year, so where is the cash coming from to fund next May's elections?


[ Parent ]

Re: Is our Party almost insolvent? (#21)

by swatantra on Thu Nov 30, 2006 at 08:48:27 AM GMT

Gordon would never dream of offering peerages for cash. No, we need to get an elected second Chamber in place asap and provide State Funding for the three main parties asap. And introduce PR in all elections. But sadly no mention of any of these in the Queens Speech; what a missed opportunity. The Govt is getting stale and is bereft of imagination


[ Parent ]

Re: Is our Party almost insolvent? (#22)

by Mark Wadsworth on Thu Nov 30, 2006 at 09:51:53 AM GMT

I'd certainly go along with elected second chamber and full PR. But taxpayer funding for parties is not the answer - parties are taxpayer funded in e.g. Germany and Helmut Kohl still got involved in a huge great secret donations scandal.


[ Parent ]

Re: Is our Party almost insolvent? (#23)

by Richard on Thu Nov 30, 2006 at 10:39:02 AM GMT

Local elections are mainly funded from local parties. Surely all CLPs have some money in their accounts. My own CLP has some properties it owes. We may need to look at CLP giving x% from accounts to Central office. Not a popular move but we need to be realistic.


Is our Party almost insolvent? | 23 comments (23 topical)