LABOUR LAUNCHES CONSULTATION ON PARTY FUNDING
(2 June 2006)

Following the cash-for-peerages row, involving rich Labour party supporters like Dr Chai Patel who were asked to make large donations or loans allegedly in exchange for honours, the Labour Party has today started a period of consultation with party members on the future of party funding. The National Executive Committee (NEC) draft consultation document seeks the views of our party stakeholders on issues likes caps on party expenditure, limits on individual donations, financial transparency and tax relief /charitable status for political parties.

The consultation period for the NEC document extends until 31 July 2006. The responses will help form the basis of the Labour Party's submission to the Phillips review later this year. In a statement issued today, the party said

"The Labour Party believes it is right that as a country we continue to invest in our democracy, by supporting strong links between citizens and their democracy. People are not apathetic about political issues – one only needs to look at the enthusiasm demonstrated for tackling issues such as global poverty.

The Labour Party believes, however, that political parties play an essential role in sustaining our political institutions, without which we cannot have a healthy, participatory democracy.

As power is devolved at every level new institutions are being created at local, regional and European levels. These institutions need relationships with politicians. There has to be investment at all these levels to ensure healthy democracy.

It is important that the review respects the membership and constitution of political parties. We believe, for example, that all our affiliates – be they socialist societies, trade unions, Constituency Labour Parties - must remain an integral part of the Labour party and we must maintain our strong links with the Coop Party with whom we share a long and proud electoral tradition."

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