Electoral Funding: Unincorporated Associations

I beg to move,

That this House has considered the role of unincorporated associations in electoral funding.

It is very good to see you in the Chair, Ms Dorries; I believe this is the first Westminster Hall debate I have participated in where you have been in the Chair.

I will introduce this somewhat obscure topic of the role of unincorporated associations in UK electoral funding by setting the scene. We begin in the Glasgow suburb of Clarkston, the type of place that is usually prefixed with “leafy”. As many hon. Members from Scottish constituencies, especially in the west, will know, it is composed of the mid-century, semi-detached houses that are a familiar sight across the west of Scotland and, I am sure, elsewhere. Anyone who has watched “Two Doors Down” on BBC Scotland might know what I am talking about.

In one of those houses lives a seemingly upstanding citizen by the name of Richard Cook, a former vice-chair of the Scottish Conservative party and former Scottish Conservative and Unionist candidate for East Renfrewshire. A cursory search turns up photos of Mr Cook with numerous Tory grandees, including the current leader of the Conservative and Unionist party in Scotland, Ruth Davidson, Member of the Scottish Parliament, and her interim replacement, Jackson Carlaw, the local MSP. There is also a photo of Mr Cook with the former Prime Minister, David Cameron, who came to East Renfrewshire to campaign for Mr Cook in 2010, in the election campaign that, as we all know, made Mr Cameron Prime Minister.

During that campaign, voters in East Renfrewshire were given an impression of a candidate in a Tory target seat who fitted the zeitgeist well—a waste management consultant who could almost have been hand-picked by Conservative campaign headquarters to represent the new, green Tories. His leaflets spoke about protecting green spaces and improving recycling.

Incredibly, during the campaign, the company that Mr Cook founded, DDR Recycling, was involved in a scam relating to the illegal shipment of waste tyres around the world, as confirmed by the Environment Agency in the UK. During investigations into those shipments, it was alleged that Mr Cook submitted false evidence to authorities in the United Kingdom and in the Republic of India investigating the case. That case is the loose thread that pulls apart the Scottish Conservative and Unionist candidate’s carefully managed public persona.

Thanks to the excellent work of investigative journalists such as Peter Geoghegan and Adam Ramsay at openDemocracy, we have been led carefully through a mystery tour of Mr Cook’s business dealings, which belied the conventional suburban milieu from which he came. DDR Recycling is now in liquidation, owing the UK taxpayer £150,000, but before that, it became embroiled in a Californian court case brought by an international haulage firm, which alleged $1.5 million of unpaid bills for waste shipments to South Korea.

That was only the beginning. Just before leaving DDR in 2014, Cook set up a company called Five Star Investment Management, with 75% of its shares held by the now late Prince Nawwaf bin Abdulaziz, a former head of Saudi Arabian intelligence, and the Saudi Arabian ambassador to the United Kingdom. A third partner, a Danish national by the name of Peter Haestrup, had previously been involved in a gun-running scandal in the Republic of India. That is only a glimpse into a dazzling array of international deals, including another $1 billion environmental project in the Islamic Republic of Pakistan, which looked to most trained observers like a litany of fraudulent deals.

While my hon. Friend wets his whistle, before he moves on from the role that journalists played in exposing the Constitutional Research Council and Mr Cook’s activities, will he acknowledge the role played by Jim Fitzpatrick of BBC Northern Ireland’s documentary series, “Spotlight”? His marvellous documentary, “Brexit, Dark Money and the DUP”, began this whole investigation and should be commended.

Order. That should be an intervention, not a speech.

Perhaps I can remind the Chamber that my hon. Friend’s name is Brendan O’Hara. I totally agree with him and commend those who have assisted in exposing dark money to the light.

Why is all that relevant to a debate about unincorporated associations in the political process? Mr Cook is the poster boy for the way in which UAs have been used to funnel vast swathes of dark money into our political process. Even worse, the Electoral Commission allows fraudsters such as him effectively to mark their own homework. The Electoral Commission gave me a very informative briefing ahead of this debate, and I will use its definition of an unincorporated association:

“UAs are associations of two or more people, which do not fall into any of the other categories of permissible donors, are carrying on business or other activities wholly or mainly in the UK and have their main office here. They are permitted to donate money to political parties, non-party campaigners, individuals in elective office such as MPs, and referendum campaigners.”

The key phrase in that definition is,

“which do not fall into any of the other categories of permissible donors”.

That is what today’s debate is about. If the Minister answers only one question in this debate, I would like it to be this one: why, given all the ways in which individuals and organisations can donate money to political parties and groups in a transparent and straightforward manner, do we still allow this backdoor method, which seems to me to be easily exploited by those who would seek to obscure the provenance of funds?

My hon. Friend is giving an excellent speech. Is he surprised and disappointed, as I was, to learn that when SNP councillors lodged a motion asking Tory councils in North Ayrshire to make a statement on dark donations to local Tory branches, the Labour councillors abstained? Does he, like me, suspect that that is not unrelated to the much-denied informal confidence and supply arrangement that exists between Labour and Tory groups across Scotland?

[Mr Ian Austin in the Chair]

It sounds like “Better Together”.

The case that proves my argument beyond doubt is the unincorporated association that Richard Cook leads: the Constitutional Research Council, or CRC. He describes the CRC as a group

“to start promoting the Union in all its…parts”,

and while it is based in Scotland, critically, it has managed to spread its tentacles across the rest of these islands. The CRC is most famous—or should I say infamous?—for the £435,000 donation it made to the Democratic Unionist party during the Brexit referendum.

Will the hon. Gentleman give way?

Not at the moment, no.

That was a vast sum for a party whose election expenses do not normally even get past five figures. Some £280,000 of that donation was spent on a wrap-around advert in the Metro newspaper in the lead-up to the Brexit referendum, despite the fact that the only part of these islands where the Metro is not distributed is the part in which the DUP itself stands.

The bizarre situation, Mr Austin—it is good to see you in the Chair, sir; perhaps you will remember folks’ names, if they are allowed an intervention—allied with the fact that the advert itself closely resembled the type of advertising promoted in the official “Vote Leave” campaign, meant that the case soon came to the attention of those investigating illegal collusion between the campaigns, including this Parliament’s own Digital, Culture, Media and Sport Committee.

While the where or why of that collusion is not relevant to the debate, the vehicle used by the campaigns as a conduit for this cash—the CRC—is. Because the CRC is an unincorporated association, it could mask the ultimate sources of those funds. I will let the Committee report say it, as it is incredible.

Will the hon. Gentleman give way?

I will not, no. The Committee stated that

“this Committee and the wider public have no way of investigating the source of the £435,000 donation to the DUP made on behalf of the CRC and are prevented from even knowing whether it came from an organisation, whose membership had either sanctioned the donation or not, or from a wealthy individual.”

This is a political donation equivalent to twice the price of the average house in most parts of these islands. It is almost 60 times greater than the £7,500 threshold for naming normal political donors, but we know absolutely nothing about its source, and the Electoral Commission cannot tell us, as elected Members in this Parliament, how it verified that it was permissible.

Will my hon. Friend give way on this point?

I will briefly, yes.

I am extremely grateful. Sometimes this stuff is hiding in plain sight. The Electoral Commission figures released earlier today tell us that the Conservative party has received a total of £400,000, with one donation coming from the household of a former Putin Minister eight months after the Salisbury poisoning, which killed a British citizen, and the other one coming from a weapons dealer and gunrunner who is a personal friend of the President of Syria, Bashar al-Assad. Does my hon. Friend agree that if that money is not returned, it confirms the Tory party’s status as a complete moral sewer?

On that point, will the hon. Gentleman give way?

No, I will not. I will make it clear that I fundamentally agree with my hon. Friend the Member for Glasgow South (Stewart Malcolm McDonald), and the Minister will not be able to turn to civil servants to answer on behalf of the Conservative party, because this is purely political. Let me also make it clear that this is the exact opposite of the probity and good governance that we would expect from a properly functioning liberal parliamentary democracy. I am sure that I am not the only one to come to the same conclusion as the DCMS Committee—that the CRC used this method.

Let me quote the Committee again. It stated that

“in order to avoid having to disclose the source of this £435,000 donation, the CRC, deliberately and knowingly, exploited a loophole in the electoral law to funnel money to the Democratic Unionist Party in Northern Ireland.”

I am of course disappointed not to see, for the first time ever, a member of the Democratic Unionist party at a Westminster Hall debate.

Will the hon. Gentleman give way?