Ruth Turner is Blair’s official Downing Street Adviser on Government Relations. There are allegations that she was deeply involved in the covert funding programme. Obviously that is crucially important if this rotten business is exposed to be an influence peddling operation.

Capita has contracts, largely with government controlled entities, worth £3 billion. Capita dominates government outsourcing with 34% of the market in administration and processing for government departments and local councils. In 2004, 52% of Capita’s revenue came from public sector outsourcing, £1.3 billion in revenue due largely to an explosion in demand for its services in line with New Labour’s controversial outsourcing policy.

Government relations is clearly of critical importance to Capita. So a £1m secret loan from the CEO to the governing party at the request of the Prime Minister’s Special Envoy is of public interest.

Guido has a lot of questions for Ruth Turner, the most important being, did she at any time have any dealings with Capita, its lobbyists or the CEO, Rod Aldridge?

One party seems keen to pursue the issue of Loans for Lordships – the Scottish Nationalists. Obviously they must be clean, canny Connery is too tight to loan ‘em cash.

In any event young Angus MacNeil MP wrote to Commissioner Ian Blair last week, and Scotland Yard has now confirmed to him that it will investigate the matter further. 1933 was the last time someone was convicted of selling peerages. The law is the law Mr Levy.

Guido suspects that his high calibre readership knows more about Loans for Lordships than is already in the public domain. Let me remind you how easy it is to anonymously pass on information – no need for secrets to be torturously extracted. Guido’s blog relies on you for information.

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If your firm’s turnover was up 11%, profits up 18% and dividends up 20%, you would be feeling pretty good about things. Wouldn’t you just be feeling so very good if you owned £50 million worth of shares in Capita, the government’s favourite outsourcer?

Now if Lord Levy, Tony Blair’s special envoy and tennis buddy, reminds you of all the good things the Labour party has done; public-private partnerships, outsourcing, privatising the collection of the TV licence, privatising the keeping of criminal records, congestion charging, bringing in management consultancies to government departments and councils. Well, if he asked you to do a good turn, you would want to, wouldn’t you?

If you had £3.4 billion of business in the pipeline, wouldn’t it be a good idea to be helpful? Could it be anything but good for business?

No one would know, it would be secret, this thing would be a little secret. Only you, Lord Levy and a few people in Downing Street would know. Tony Blair would know. That could only be good, couldn’t it? They might do another good thing for you. Yes. “Lord Aldridge”, that would be good…

Although a young Guido did fail to become an accountant (well, failed to complete the course due to a surplus of imagination) he learnt how to read balance sheets and yet still can’t figure out Labour’s balance sheet. From the Labour Party’s 2004 Annual Report :

“The Labour Party at the year-end had agreed overdraft and long term loan facilities with the Co-operative Bank and Unity Trust Bank totalling £11.5 million. “ (Secured against property.)

They paid £640,000 interest on “Bank loans” implying a commercially competitive rate of 5.56% from the Co-Op and trade union backed Unity bank. Note 17 of the Financial Statement shows the loan repayment schedule, it also has under the heading “Other Loans” nothing listed for 2004. So presumably the £14 million of Loans for Lordships was all raised in 2005, at a rate of more than a million a month? Page 14 of the report lists the individuals and organisations who gave over £5,000. Notable is pint-sized Derek Tullett (in for, we now know, £400,000). Tullet is a City moneybroker and bitter rival of Michael Spencer, the Tory moneybags backer. Derek’s management practises include forcing underperfoming Jewish staff to dress up in Nazi uniforms – which resulted in a hefty six-figure compensation payout at an industrial tribune.

Guido notices that Labour also raised £6 million from dinners – another shakedown that can be charged by corporations to expenses, lobbyists love this dodge. It gets round making tiresome corporate governance declarations.

We will have to wait until September to see an account for 2005, it will certainly make interesting reading. The interest bill for the Loans for Lordships should, at commercial rates, be at least £775,000. It is too late now to cook the books retrospectively. Either the interest has been paid or it hasn’t. Any attempt to cover it up at this stage will involve falsifying accounts, something the Labour party NEC will not, presumably, be in any mood to countenance. No interest payments will mean the whole “it’s a loan” thing will be proven to be a lie – but we know that already. They told us only yesterday they could not reveal the names because it was confidential. Today they broke that confidence. Things are unravelling.

Alan B’stard’s return as a Labour MP and the Downing Street adviser on “Prices for Peerages” is of course fiction, in reality that job is done by Ruth Turner in the PM’s office. (Guido supects that Shaun Woodward won’t be in the front row of the B’stard play’s first night. )

Labour has released the names of the “lenders” after saying only yesterday that they could not possibly break their confidences.

Funding Facts:

• 80% of Labour’s election funding came from the covert Loans for Lordship program.
• Every donor who has given the party more than £1 million has been given a knighthood or a peerage.
• Three quarters of those individuals who have given more than £50,000 to the Labour Party since 2001 have received an honour.

This recent EDM from Gordon Prentice takes on an amusing dimension today:

EDM 1604 ABUSES OF HONOURS 08.02.2006

That this House notes that since the Honours (Prevention of Abuses) Act 1925 was put on the Statute Book there has been only one prosecution, in 1933; and believes with the passage of such a long time without prosecutions, organisations such as the Specialist Schools and Academies Trust should be reminded of its existence.

What most sickens Guido is the defence the whole political class is adopting – “everyone does it.” That is not a defence, it is an admission of guilt.

Indications are that an attempt at agenda seizing will be made by the Tories with an announcement tomorrow. They will advocate limits on individual donations (thought to be as low as in the thousands). If true it could be a clever ruse, firstly it puts the Labour party on the back foot on the whole Loans for Lordships issue and shows leadership on the odourous political funding agenda.

Tim Montgomerie has been campaigning for a £100,000 limit on party donations, which seems reasonable, but Guido expects the proposed cap to be in five-figures. The effect of this will be that non-party organisations will get funding (as with political action committees in the U.S.). Effectively political funding will be diversified and less controlled centrally by the parties, this can only be a good thing. The situation where the Labour party is funded and controlled from within No. 10 is just unhealthy. The Sunday Telegraph reports that;

A certificate putting forward a nominee for a peerage – and misleadingly stating they did not have a financial relationship with the party – was filled in inside No 10… Ruth Turner, the Prime Minister’s head of government relations, played a key part in arranging the application, as well as at least one other. They were then taken to the hospital bedside of Ian McCartney, the Labour Party chairman, who signed them. The certificates were then sent to the House of Lords Appointments Commission, whose members are understood to be “concerned” that they might have been misled about the financial relationship between nominees for peerages and political parties.

If true it will implicate No. 10 with involvement in Lying for Loans for Lordships. A potentially lethal development.

Incidentally on Betfair the “Blair Switch” market has seen the odds on Blair going this summer slashed in the last few days. The odds on him going between April and June have dropped from 8/1 to 4/1 and between July and September from 10/1 to 6/1. Guido has been backing him to go in September as a consequence of a stalking horse candidate coming forward or even a real election challenge at the Labour party conference. There is a mechanism in the Labour party constitution to allow this, 52 MPs rebelled in the Education Bill, Jack Dromey and the TGWU are getting restless, Brown’s smile is wearing thin – are we at the tipping point? Punters seem to be thinking we could be…