A legal loophole in England has allowed branches of political parties to claim hundreds of thousands of pounds of public cash during the Covid crisis – even as millions of ordinary people were frozen out of help.
A Freedom of Information investigation by HuffPost UK has revealed more than 22 local branches of political parties were handed £10,000 grants to pay their business rates for high street campaign offices.
Branches of the ruling Tory Party claimed by far the most, a total of £150,000, with 15 Conservative Associations (CAs) applying to town halls for money or being handed it automatically. Seven Constituency Labour Parties (CLPs) claimed £70,000 in total. Two branches of the Conservative Party and one branch of Labour repaid their share of the cash.
Chancellor Rishi Sunak set up a series of support schemes last year, giving councils the job of handing out money.
No political party has been found yet to have successfully claimed in Scotland or Wales, where devolved governments issued stricter guidance to town halls.
The Scottish government told councils: “No part of the grant shall be used to fund any activity or material which is party political in intention, use, or presentation, or appears to be designed to affect support for a political party.”
In Wales, it was underlined to councils that grants were “targeted at supporting hospitality, leisure, retail, tourism and supply chain businesses”, adding: “Applicants have had to demonstrate a material impact on their business to be eligible for funding.”
In England, however, the guidelines were more open, with organisations asked only to show they were forced to close during lockdown, and that their premises were subject to business rates.
The Conservative Party has said associations are “no different from other organisations in facing challenging times”.
But it comes as small businesses complain of long delays to their grant applications to councils, and as millions of hard-pressed self-employed people remain cut off from government support altogether.
Excluded UK, a campaign group set up to support those frozen out of state aid during Covid, said handing cash to political parties while businesses were folding was “very unjust”.
Rachel Flower, founder of the campaign, said there had been a “postcode lottery”, with different councils “applying the rules differently” for businesses, with a “large number” of Excluded members refused any grant.
She said: “It seems very unfair that grants are being used in this way yet not for the small businesses for which we were all led to believe that they were intended.”
The local parties who claimed include:
Conservative Associations of serving ministers, attorney general Suella Braverman, foreign office minister Nigel Adams and solicitor general Michael Ellis;
The Tory Party branch of first secretary of state Damian Green and David Davis, though HuffPost understands the latter was returned;
Ten Conservative Associations who claimed from a Tory-led town hall, with five who claimed from Labour, Lib Dem or hung councils;
Seven local Labour Party branches, including Stella Creasy’s Walthamstow, though HuffPost understands Walthamstow CLP subsequently returned the payment.
Our Freedom of Information requests also uncovered that grants and supports were handed to clubs that may raise cash for parties, including £162,000 that went to various Conservative clubs and £68,000 to Labour clubs. Parties do not run these organisations, however, and not all will be involved in raising political funds.
Covid grants handed out to Tory associations
Local associations select and campaign for parliamentary candidates.
Ashford Conservative Association (Tory MP Damien Green): £10,000
Bassetlaw Conservative Association (Tory MP Brendan Clarke-Smith): £10,000
Beverley and Holderness Conservative Association (Tory MP Graham Stewart): £10,000
Haltemprice Conservative Association (Tory MP David Davis): £10,000, which was later returned
Tatton Conservative Association (Tory MP Esther McVey): £10,000, which was later returned
Crewe and Nantwich Conservative Association (Tory MP Kieran Mullan): £10,000
Westmorland and Lonsdale Conservative Association (no local Tory MP): £10,000
Fareham Conservative Association (Tory MP Suella Braverman): £10,000
Harrogate and Knaresborough Conservative Association (Tory MP Andrew Jones): £10,000
Hemel Hempstead Conservative Association (Tory MP Mike Penning): £10,000
Romford Conservative Association (Tory MP Andrew Rosindell): £10,000
Selby and Ainsty Constituency Conservative Association (Tory MP Nigel Adams): £10,000
Shipley Conservative Association (Tory MP Philip Davies): £10,000
Northampton Central Conservative Association (Tory MPs Michael Ellis, Andrew Lewer and Andrea Leadsom), £10,000
South Suffolk Conservative Association (Tory MP James Cartlidge): £10,000
Democracy campaigners have hit out at the trend of local party branches accepting public cash.
Steve Goodrich, senior research manger with anti-corruption group Transparency International UK, said: “There are heightened sensitivities about the use of public funds during the current crisis, and especially so when they are received by political parties.
“Whilst it may be permissible for constituency parties to accept government support, doing so may risk appearing as self-serving, especially by those who have not been eligible for assistance.
“Given the current low levels of trust in politics, it would be prudent for them to think carefully about the broader impacts of them applying for this funding, especially when these organisations would be ineligible for similar relief in other parts of the UK.”
Tom Brake, director of Unlock Democracy, a non-partisan pressure group campaigning for a written UK constitution, said: “People will be really unimpressed to learn that politicians, often already in receipt of taxpayers’ support, have seen their parties benefit from covid business grants too.
“The UK government would have been well advised to look over the border to Scotland, where such payments were prohibited.”
Covid grants handed to Constituency Labour Parties
Dartford Labour Party (no Labour MP): £10,000
Ipswich Labour Party (no Labour MP): £10,000
St Albans Labour Party (no Labour MP): £10,000
South Suffolk Labour Party (no Labour MP): £10,000
Suffolk County Labour Party (no Labour MP): £10,000
Walthamstow Labour Party (Labour MP Stella Creasy): £10,000, which was later returned
Workington Labour Party (no Labour MP): £10,000
A Conservative Party spokesperson said that councils decide whether a Tory Association is eligible.
They added: “Local political associations are no different from other organisations in facing challenging times. The purpose of the coronavirus support schemes is to protect small organisations and prevent local job losses.
“The funding from these schemes is in line with government guidance.”
But Esther McVey, the former work and pensions secretary who has campaigned against supermarkets claiming rates relief, said her local party Tatton Conservative Association had only been handed the cash because of an automatic process at Cheshire East Council – and had handed it back because it would have been inappropriate to keep it.
The Labour Party, meanwhile, declined to comment.
Labour MP Stella Creasy said her CLP did not apply for the cash but was paid the grant automatically by the local authority. The money was repaid by the CLP last year, when this became apparent.
Creasy said: ’’Walthamstow CLP pays rates as a small business and so was automatically given this grant, without applying for it, by the local authority.
“When the officers of the CLP realised what had happened, they took steps to repay it.”
Editor’s note: An earlier version of this story stated only that Tatton Conservative Association had received the grant but not that it had been returned. We amended it when we were made aware that the cash had been given back.