Ed Miliband demands inquiry as PM urges progress on political funding reform and says Peter Cruddas was right to resign
- Daniel Boffey, policy editor, and Haroon Siddique
- guardian.co.uk, Sunday 25 March 2012 17.08 BST
David Cameron described cash-for-access by Peter Cruddas as 'completely unacceptable' Link to this video
David Cameron has described revelations that the Tory party co-treasurer Peter Cruddas offered access to the prime minister and chancellor for up to £250,000 as "completely unacceptable" and said it was not the way the Conservatives raised money, as he faced demands for an independent inquiry.
Cruddas resigned after footage emerged of him apparently making the offer to undercover reporters. Cameron moved quickly to try to minimise damage, instructing the Cabinet Office minister, Francis Maude, and the Conservative party co-chairman Andrew Feldman to urgently progress talks on political funding, according to the influential ConservativeHome website.
Cameron said: "What happened was completely unacceptable. This is not the way that we raise money in the Conservative party, it shouldn't have happened. It's quite right that Peter Cruddas resigned. I'll make sure there is a proper party inquiry to make sure this can't happen again."
But the Labour leader, Ed Miliband, said the announcement of an internal inquiry did not to far enough, calling for "a full independent investigation to reassure the British public". He said the investigation should cover "what happened, who knew what happened and what contributions were made".
In a letter to the prime minister, the shadow minister Michael Dugher demanded that the prime minister disclose which Tory donors had visited Downing Street, Chequers or Dorneywood since May 2010 and what policy representations they had made, particularly on the top rate of income tax, which was cut in Wednesday's budget.
Confronted with the allegations, the Conservatives were at pains to stress that large political donations were not their sole preserve, as a number of senior Tory figures referenced Labour's support from the unions and the Formula 1 boss Bernie Ecclestone's infamous £1m donation to Tony Blair in 1997
The deputy prime minister, Nick Clegg, is charged with reforming the party funding system, and the chief secretary to the Treasury, Danny Alexander, said Cruddas's actions strengthened the case for change.
Describing Cruddas's behaviour as "utterly disgraceful", Alexander told BBC1's Andrew Marr Show: "What these headlines show today is the absolute necessity of having reforms to our party funding system to deal with this sort of taint that big donors might be able to influence … policy."
However, Alexander rejected the idea that "big money" influenced government, saying: "There's no prospect of donors influencing government policy but we need to make sure the system does not allow the perception to arise either."
The Tory peer Lord Fink is to replace Cruddas as the party's principal treasurer, it was announced on Sunday. Fink, a hedge fund millionaire, previously held the role until earlier this month, when it was taken over by Cruddas.
In his resignation statement on Saturday night, Cruddas, the senior Conservative official responsible for collecting donations for the party, said he deeply regretted the repercussions of his "bluster" during the recorded conversations.
He said: "Clearly there is no question of donors being able to influence policy or gain undue access to politicians. Specifically, it was categorically not the case that I could offer, or that David Cameron would consider, any access as a result of a donation. Similarly, I have never knowingly even met anyone from the No 10 policy unit.
"But in order to make that clear beyond doubt, I have regrettably decided to resign with immediate effect."
Cruddas, founder of the online trading company Currency Management Consultants, is heard in the recording discussing how much access different-sized donations would get, during an undercover operation run by the Sunday Times.
He is heard to say: "Two hundred grand to 250 is premier league … what you would get is, when we talk about your donations the first thing we want to do is get you at the Cameron/Osborne dinners.
"You do really pick up a lot of information and when you see the prime minister, you're seeing David Cameron, not the prime minister. But within that room everything is confidential – you can ask him practically any question you want.
"If you're unhappy about something, we will listen to you and put it into the policy committee at No 10 – we feed all feedback to the policy committee."
The Sunday Times claims the offer was made even though Cruddas knew the money would come from a fund in Liechtenstein that was not eligible to make donations under electoral law. Options said to have been discussed included creating a British subsidiary or using UK employees as conduits. The overseas clients were, in fact, reporters posing as wealth fund executives who had made clear they wished to develop contacts with the prime minister and other senior ministers to further their business.
The Conservative party deputy chairman, Michael Fallon, told Sky News the donation "would certainly not have got through our normal compliance checks". He said Cruddas had "over-boasted about what you could do with a particular donation".
The disclosures appear to contradict previous claims by the Conservatives that their high-value donor groups, such as the "leader's group", are for genuine supporters who do not seek to influence policy in return for their cash.
They also raise questions about the role of the prime minister. Months before taking office, Cameron warned that this type of "secret corporate lobbying" was the "next big scandal waiting to happen".
Yet the Sunday Times claims the meetings, at which Cruddas claimed "premier league" donors could lobby the prime minister directly, have not been declared to the public.