As I begin writing it is Sunday afternoon, during one of the wars waged in our name in recent years. My children lie asleep and my wife is out for a nice long walk. I put my feet up on the sofa, settle my spectacles on my nose and scour the Sunday paper websites. A nice roast is in the oven ready for dinner this evening, and a cup of mahogany-brown tea (properly made in a pot), has put me in just the right mood. My sofa cushions are soft underneath me, the air is warm and stagnant. In these blissful circumstances what is it that I want to read about?
Naturally, about a scandal. But what kind of scandal? If one examines the political scandals that have given the greatest amount of pleasure to the British public, the scandals whose story is known in general outline to almost everyone and which are rehashed over and over again in the Sunday papers, one finds a fairly strong family resemblance running through the greater number of them. It’s sex. From Profumo to Thorpe to Archer to Mellor to Ashdown to Major and Currie to Blunkett to Sheridan those political scandals we love to read involve the sex lives of the powerful, or the nearly powerful. But those tawdry affairs where great (and not so great) men (it’s almost always men) have abused their dishonourable members are nothing to the real scandals – which suggest a canker at the heart of the system. These scandals involve money. The purchase of honours and favours – bribes to ease planning applications, money to award contracts, money to ask questions, or to influence policy. The sex scandals are the ones we remember, giving us a quick laugh before we move on to the next one involving a TV or music star – the financial scandals are those that undermine the system.
And the scandals used to be of such high quality. They involved big sums or the infrastructure of entire cities. Scottish scandals are very poor in comparison. The former leader of the Scottish Conservative party resigned following ineligible claims for £900 of taxi fares to the office of his former law firm; the former First Minister, Henry McLeish, resigned following an unregistered sublet of his offices and issues relating to expenses of, I think around £9,000. These are pretend scandals – pockets lined to some degree: cock ups not conspiracies. But resignations have resulted. And anyone getting into Scottish politics should realise that financial matters, even for sums as small as £900 (or £950) are going to be scrutinised. Our scandals are ridiculous poor in the grand scheme of things.
In 1980 Norman MacCaig wrote “Bruce and that spider – the truth”. Its moral is one modern Scottish politicians (modern politicians as a whole perhaps) apply thoughtlessly.
The spider tried again.
It was too stupid to learn from experience.
It swung like a black watch on a silver thread
before Bruce’s face.
As swung watches do it began
to hypnotise him.
Bruce shook his Norman head and muttered,
Damn the brute, I’m getting out of here.
And, being too stupid to learn from experience,
he fought the Battle of bannockburn. And won.
Moral? Experience teaches
that it doesn’t.
(The Poems of Norman MacCaig, pp 383 – 4).
Experience teaches that it doesn’t. A moral evidenced by the fact that yet another Scottish political leader faces resignation after being ensnared in a financial scandal over relatively small amounts of money.
The electoral rules in the Political Parties, Elections and Referendums Act 2000 (enacted at the instigation of a Labour government) provide that the only permissible donors to political parties are those listed in s 54 of that Act. This excludes individuals that are not on the electoral register, such as residents of Jersey. Further, s 62 of the Act provides that once donations of more than £5,000 have been made any further donation of more than £1,000 must be registered with the Electoral Commission or (where there are separate accounting units within a party) donations of £1,000 must be registered. These rules are then applied to individual members running for office within political parties by Sch 7 to the Act.
In relation to s 54 of the Act it is provided by s 61 that
“(1) A person commits an offence if he—
(a) knowingly enters into, or
(b) knowingly does any act in furtherance of,
any arrangement which facilitates or is likely to facilitate, whether by means of any concealment or disguise or otherwise, the making of donations to a registered party by any person or body other than a permissible donor.”
In relation to Sch 7 para 6 prohibits the receipt of donations from impermissible donors (for example people from Jersey) and Sch 7 para 9 applies s 61 to instances of evasion. This is an offence – albeit one which requires the relevant party (in case of leadership elections, the candidate – the regulated donee – to “knowingly” enter into an arrangement which breaches the law.
Sch 7 para 12 then makes it an offence if the regulated donee (the candidate) fails to register the donations and state how impermissible donations were dealt with.
So, how does this affect sister Wendy, sibling of the great Douglas “MIss Hoolie” Alexander?
Well, first – she received a donation from a Jersey resident ineligible to vote in the UK. Her initial response was for her “fixer” Tom McCabe to claim that she had acted in good faith, that they hadn’t known about the problem until a day or two before. This changed to a suggestion that fall guy Charlie Gordon had screwed up. Gordon lost a front bench position as a result. At this point they accepted a breach of the law but maintained a position of ignorance – that they hadn’t known that it was from a non-Uk resident but believed it was a donation from a UK firm or company. The Labour party thought that had finished matters. However, the donor, Paul Green, then emerged to make clear that this donation was not through a company but personal and this was made clear (and appeared to have been understood). He had received a personal letter from Wendy Alexander thanking him for the donation, addressed to his Jersey postal address. The ignorance defence started to fall apart.
While I have sympathy for a view that a personal letter is not indicative of anything other than courtesy (I posted a comment to this effect on a thoughtful post by Will yesterday). However, there are two matters of concern. First to suggest that a donation from an individual is really from a company flies in the face of basic rules of company law. A company representative will incur personal liability if they do not make clear that they are acting on behalf of a company. In relation to a cheque, for example, s 349 (4) provides that
“If an officer of a company or a person on its behalf signs or authorises to be signed on behalf of the company any bill of exchange, promissory note, endorsement, cheque or order for money or goods in which the company’s name is not mentioned as required by subsection (1), he is liable to a fine; and he is further personally liable to the holder of the bill of exchange, promissory note, cheque or order for money or goods for the amount of it (unless it is duly paid by the company).”
Hence, any omission to name the company would impact on the director at civil and criminal level. Accordingly, the omission of a company name on the donation could be critical in determining good faith.
Second, the letter was addressed to Jersey. Now, it could be said – as it is by Chris Paul – that this is an administrative matter, suggesting that people do not necessarily read what is put in front of them. That may be the case, some people may not properly read their mortgage application or insurance proposal, but the law takes a dim view of that. One famous old contract case, L’estrange v Graucob  2 KB 344 indicates that signature of a document involves an assumption that the document was read by the signatory – and binds the signatory to the contents. To infer otherwise undermines the evidential value of written documents. It will be for Ms Alexander to establish that she did NOT read the letter and was NOT aware of its contents – and as we all know proof of a negative is highly problematic.
Ms Alexander then was in trouble. The Scottish press this morning was gunning for her (see, for example, Scotland on Sunday that tries to tie this in to a cash for honours issue). However, as the Sunday herald had originally broken the story last week, this week it provides the ammunition that will – in my view – finish off Wendy Alexander’s leadership.
First, it has shown that Ms Alexander knew about the problem weeks before she admitted to knowing about the problem. As the Sunday Herald notes
“The list [of donors] confirms a £950 donation had been made from Green, states his full Jersey address for the “purpose” of Electoral Commission registration, but questions its legality by stating: “Permissible?” “
Further this list has in its properties an indication that it came from a computer registered to Professor Brian Ashford, or Mr Wendy Alexander.
As is often the case with these trivial matters (and as was the case with taxigate, and officegate) it is the failure to be completely open at the beginning of the media investigations into the problems that causes the difficulties as subsequent disclosures reveal inconsistencies in the original story.
As damning though is the next part of the story. The document indicates an attempt to switch a donor. This may simply have been a typo, but the name in the column headed donor does not tally with the name in the column headed name/address for electoral commission purposes. If this is the case then Ms Alexander risks being involved in the rules relating to third party donations which have caught the Labour party at UK level. If true this also indicates potential evasion of electoral donation rules (as does the legitimate practice of seeking donations which fall just below the appropriate registration and publication limits).
The amounts are trivial. The principles are not. Wendy Alexander will have to go or she will end up damaging her party even further (as suggested by Will). For her position as regulated donee means that she personally is in the firing line if criminal actions are initiated. As of today she is staying, though, despite the request from the SNP for initiation of a police investigation. She is staying because her departure will increase the pressure on Harriet Harman who accepted a third party donation. She is staying because her primary loyalty seems to be, not to her party but, to Gordon Brown personally.
And where Westminster thrills to a scandal involving £600,000 of donations the future of the Scottish Labour leader rests on £950, a personal letter, and a word document.
(The title and opening two paragraphs come with apologies to the estimable Mr Blair)