The Hindu : Labour in a fresh sleaze row

Online edition of India's National Newspaper
Monday, May 13, 2002

International

International

Labour in a fresh sleaze row

By Hasan Suroor

LONDON MAY 12 . The Blair Government was today caught up in yet another all-too-familiar sleaze row, this time involving a £100,000 donation to the Labour party by the media tycoon, Richard Desmond, sometime shortly after his takeover of the Express group of newspapers was cleared by the Government last year without referring it to the Competition Commission despite protests by party MPs.

The donation, it was alleged, might have played a role in the decision to bypass the Commission which could have blocked the deal. While the Government dismissed the allegation as a "pathetic smear'', the Opposition insisted on an inquiry calling it the latest in a series of cash-for-favours `scandals' involving Labour and big business.

Mr. Desmond's background as a publisher of a number of pornographic titles lent spice to the row with critics accusing Labour's leading lights of `hobnobbing' with a `porno king'. A woman Labour MP, Kate Hoey, said she was disappointed that the party took a donation from "individuals whose actions harm women''.

The Tory chairman, David Davis, said the British Prime Minister, Tony Blair, had "a lot of explaining to do'' as the donation was said to have followed a meeting he had with Mr. Desmond at Downing Street. "The Prime Minister should make public the dates and times of all his meetings with Mr. Desmond,'' he said adding that it was important to establish whether the donation influenced the Government's decision to give a green signal to the £125 million Express takeover deal.

The Express group which publishes the Daily Express, Sunday Express and Daily Star was originally owned by the Labour peer and a staunch Blairite Lord Hollick, whereas Mr. Desmond had been a Tory supporter. His bid to take over the newspapers in November 2000 raised fears in Labour Party that he would turn them into Tory campaigners but Mr. Desmond was quick to dispel such fears in an interview to the Sunday Express. It is alleged that even as the Department of Trade and Industry (DTI) was considering whether or not to refer the takeover to the Competition Commission, Mr. Desmond met Mr. Blair and offered free advertising in his newspapers for Labour's upcoming election campaign.

The Labour party, however, preferred a donation which was then used by it to buy advertising space in Express newspapers. Within weeks of the meeting, the DTI cleared the deal overruling protests from party MPs that it should be referred to the Competition Commission. "The exact date of the donation is not unclear, but the fact that more than a year later it has not been declared by either Desmond or Labour has led to opposition claims that the timing of the donation was designed to keep a lid on a potential scandal in the run-up to last June's general election,'' The Observer said.

The DTI denied that the donation had anything to do with the decision to clear the deal, and a spokesperson for Mr. Desmond said the money was given in a "fully transparent manner''. Both Labour and Mr. Desmond's Northern & Shell which owns the Express group claimed that the donation would figure in their annual accounts later this year.

The controversy comes even as the Government is still smarting from attacks over the Hindujas' passport affair and the `help' it gave to the Indian steel magnate, Lakshmi Mittal, in clinching a deal with Romania after he made a donation to Labour election fund.

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