The Conservatives’ London mayoral candidate has received nearly 40% of his campaign donations from the former party treasurer Lord Ashcroft, who has been at the centre of a decade of offshore tax controversies.
Shaun Bailey, the challenger to Labour’s Sadiq Khan, has raised £255,000 in cash since the beginning of 2020, according to Electoral Commission records, but has been in effect heavily reliant on a £100,000 Ashcroft donation to keep his faltering campaign alive.
Labour seized on the disclosure to accuse Bailey of being out of touch – while the Conservatives accused their opponents of spending too much time on PR, in one of the first skirmishes of the London mayoral election due in early May.
Ashcroft was a heavy donor to the Conservatives in the previous decade but confirmed in 2010 he had been not domiciled in the UK for tax purposes throughout that period – although it was widely believed he was. So-called non-doms only pay UK tax on their UK income.
The businessman and financier subsequently said he would change his tax status to comply with a change in the law requiring members of the House of Lords to be domiciled in the UK.
Ashcroft subsequently resigned his seat at Westminster in 2015 to concentrate on other interests and had appeared to be drifting apart from the Conservatives, although he retained his peerage and title.
A company Ashcroft is linked to, Medacs Healthcare, an existing contractor to the NHS, was also recently awarded a £350m contract to provide Covid-19 lab testing to the NHS. Ashcroft is non-executive chairman of its owner Impellam Group.
Last month, when news of the contract emerged, Ashcroft’s spokesman said he was not involved in the negotiation of the contract with the Department of Health and Social Care and did not know about it until after it had been awarded.
Campaign insiders say Bailey has struggled to recruit other big-name donors despite promises of help from the prime minister. Boris Johnson, partly because he is so far behind Khan in the polls.
Late last month, Bailey had to release his three most senior media advisers because of lack of funds. Campaign sources said at the time that the Conservatives had to “focus resources on ground campaigning and digital”.
The Conservative is polling at 28% to Khan’s 49%, according to a survey conducted by Redfield & Wilton Strategies last month, which would put the Labour incumbent on course for a record-breaking win in 20 years of mayoral contests.
Labour also highlighted other names on Bailey’s donor list, including the construction company Keltbray, owned by the Tory donor Brendan Kerr, which gave £25,000 in July. Keltbray owned a joint venture waste company from 2008 to 2011 with the crime boss David Hunt called Keltbray Hunt.
A spokeswoman for Kerr has previously said the construction magnate did not have any association with Hunt. “The only dealings between them relate to a subsidiary company of the Keltbray Group, of which Mr Kerr is the majority stakeholder, entering a joint venture in the company Keltbray Hunt.”
The party also picked out some Bailey donors dating back to 2018. They included Michael Tory, a former head of investment banking at Lehman Brothers at the time of its collapse, who donated £2,500 that year.
Angela Rayner, Labour’s deputy leader, said: “If the Tory candidate cares at all about standing up for Londoners then he will start by respecting London’s values when it comes to accepting political donations.”
But a spokesman for Bailey said Labour should focus on voters’ issues: “If Labour really cared about Londoners’ values, they would tell their mayoral candidate to stop funding his PR budget and start cutting crime.”
