"Ban business funding of politics"

[Chris Burford]

The fruits of New Labour's risky but tactical approach to capitalist 
influence over the electoral process. Could US business get to this point??

Chris Burford

London



Ban party funding, says CBI chief

By Michael Harrison, Business Editor

20 May 2002

Political donations from companies should be banned and replaced by a 
system of state funding of parties, the leader of British industry said 
yesterday.

Sir John Egan, the new president of the Confederation of British Industry, 
said it had become too risky for businessmen to make donations and for 
political parties to accept them because of the ensuing allegations of sleaze.

"It is a very, very dangerous area," Sir John said. "This is a risky thing 
to be doing. I advised the previous government that the money should be 
coming from the state. Any money from individuals should be limited to a 
very small amount ­ £100 or something like that. Many of the issues the 
newspapers have been raising about payments from various companies for 
favours don't look very attractive. It doesn't look very nice."

Sir John's call for state funding of parties follows a series of 
embarrassing disclosures about business donations to Labour.

Senior figures in the Government, including Charles Clarke, the Labour 
Party chairman, and David Blunkett, the Home Secretary, have expressed 
support for state funding.

A spokesman for the Labour Party said it welcomed the CBI's contribution to 
the debate but stressed that the Government's own reforms had made 
donations more transparent. "The extension of state funding would require a 
consensus across the parties and that consensus does not exist at present," 
he said. "We want a real debate."

Mr Blair admitted last week that fund-raising was one of the aspects of his 
job he "liked least". He is understood privately to back state funding but 
is wary of public opinion and knows the Conservatives' opposition to the 
idea in effect rules it out.

Paul Flynn, the Labour MP for Newport West, yesterday supported Sir John's 
stance on state funding. "It would take away the suspicion of corruption of 
political parties," he said.

"It should be sold to the public as a long overdue reform but unfortunately 
it has come out the wrong way with all the stories about sleaze."