THE UK’s election watchdog has opened a probe into a major Labour donor after a donation of almost £600,000.
In an apparent breach of transparency laws, the Barnes & Richmond Labour Club and Institute could face action from the Electoral Commission – however, it says the Labour Party did not inform it of all donor rules.
The organisation donated £598,000 to Labour in December 2022 and is listed by the party’s headquarters as an unincorporated association, which is a legal term for organisations that aren’t registered companies or other formal bodies.
Under UK electoral law, unincorporated associations that give more than £25,000 in any given year must register themselves with the Electoral Commission.
The Barnes and Richmond Labour Club is not on in the register of unincorporated associations, according to reports by openDemocracy.
A former secretary of the organisation told openDemocracy the cash had come from the sale of the club's building, and a spokesperson for the club said the central Labour Party hadn’t informed it of this rule.
Labour did not respond to openDemocracy’s request for comment, and the publication said it “raises questions about Labour HQ’s rigour in ensuring its donors comply with electoral law”.
The donor rule was introduced in 2009 to ensure organisations could not be used as fronts for donations to political parties.
An Electoral Commission spokesperson said: “We have not received a notification from Barnes and Richmond Labour Club that they are an unincorporated association and they have made a political contribution above the £25,000 threshold in the 2022 calendar year.
“As such, we are contacting the club to find out more information about this matter and their status and we will then consider what, if any, action is appropriate.”
Chris Priest, a former secretary of both the club and the local Richmond Park Constituency Labour Party, told openDemocracy the Barnes and Richmond Labour Club had been run as a social club for Labour members and supporters, as well as an office.
Rose Whiffen of Transparency International said: “Unincorporated associations can be useful vehicles for local fundraising clubs to rally support for a political party in their area, but ambiguous and weak reporting requirements mean their financial arrangements are often kept from public view.
“Very few of these groups actually report the original source of their donations, making it far too easy for money of dubious origin to fund political parties. Clearly, [donors] should abide by the current rules, but to bring dark money out of the shadows, we need a significantly lower threshold for transparency over these donations.”
