Is Labour broke?

May 9, 2008 at 4:48 pm | Posted in British Politics, New Labour | 1 Comment
Tags: If It's Broke - Fix It, New Labour

Now this is would be a successful way of appealing to the country: Vote Labour – We’re As Broke As You!

Lib Deb Voice links to this Tribune article speculating that Labour’s finances are in such a sorry state that it could be on the verge of bankruptcy:

Labour chiefs have until the end of this month to plug a £4 million hole in the party’s finances and avert the possibility of a formal declaration of bankruptcy.

The financial crisis in the wake of the party’s drubbing at the local and London polls comes as Gordon Brown faces another humiliation with a possible defeat by the Tories in the Crewe and Nantwich by-election.

Auditors are due to sign off the party’s accounts soon after the end of May, but there are fears that they will refuse to do so and instead declare the party insolvent.

[…]

One Labour head office worker who has seen the books said: “Whether we sort out the immediate problem or not, we are still going to have to rely on millions of donations. The money is just not coming in.”

A note of caution: the article’s not particularly well-sourced and seems fleshed-out with conjecture. Also, there have been other warnings about Labour’s funding crises/impending bankruptcy in the past, and still the party’s been able to function with some degree of competence. But regardless of the caveats, I can’t image their finances are in any kind of state to fight the next election.

When the party’s lost so much resonance with the public that they aren’t even inclined to vote for you, let alone join your party or donate a penny of their hard-earned money, you’ve got to find funds from somewhere. That either means taking out expensive and ill-advised loans or being funded by wealthy donors who want something in exchange: a knighthood or peerage, or perhaps a package of ‘pro-business reforms’ that end up screwing the very people they went into politics to help.

Seriously, if the party doesn’t find the right message and the right methods to rebuild from the grassroots upwards, the Tories could have a very comfortable decade in power.