The Editor of "The Daily Telegraph" gets it wrong!

Charles Moore wrote to "The Times" (letters November 9) "Mary Ann Sieghart flatters me as the "one man (who) has the power to remove Iain Duncan Smith". In fact, the people with that power are Conservative MPs and, for the first time, the Party’s national membership."

This is not the case. Only the MPs have the power to remove the Leader of the Party.

In spite of the fact that 160,000 members voted for Iain Duncan Smith, 83 MPs – a majority of the Parliamentary Party - can dismiss him and once dismissed he cannot stand again. Who devised these rules? – why the MPs of course.

It is an essential element of democracy that those that elect a Leader should be the same as those that remove a Leader. The Leader should be elected for a period of say three years and then automatically come up for re-election by the members.

                                                                                       August 2002

Introduction

Today the British public are better informed than ever about our democratic processes and they realise that democratic fault lines run through the two main Parties. They ask why the taxpayer should fund the Labour and Conservative parties in order that the self-perpetuating oligarchies that control them can maintain their control.

Both parties are fundamentally undemocratic. Each operates the discredited Electoral College system where a member’s vote has less value than an MP’s vote. Each has an unelected, unaccountable chairman.

Democracy is a process in which you determine the will of the majority. That will can only be determined if all members are able to participate and each member has a vote of equal value and the vote is exercised by way of a secret ballot.

Unless the political parties are made democratic and accountable to their members, state funding will merely change the public perception of corruption by individuals making large donations to one of corruption by the State. Without strict requirements being in place before a political party receives state funding there is a financial scandal waiting to happen

At present the Conservative Party receives over £3,000,000 per annum from the State for "research" and policy development. Where does research begin and political propaganda end? In any case money that would have been spent on research without state funding can now be spent on political propaganda. Every Member of Parliament can now claim £70,000 per annum from the State for research. This amounts in total to over £11,000,000, just for the Conservative Party. Yet five years ago the Conservative Party paid for its research out of its own pocket.

Even today with all the focus on party funding there is still a temptation for an individual to try and buy influence. David Davis turned down two potential donations when he was Party Chairman because the donors attached conditions to the donation. In the one case they wanted to be on the candidates list and in the other case they wanted a change in Party policy.

Membership of the two Parties is in long term decline. Since 1951 Conservative Party membership has fallen from 2.8million to approximately 250,000. In the same period Labour membership has fallen from 1 million to 250,000.

It is the decline in membership which has exacerbated the financial difficulties which the two Parties now face. If this decline in membership could be reversed then the Parties would be well on the way to overcoming their financial problems. Both Parties have failed to understand that in order to increase their membership they have to become more democratic. Members now demand rights and benefits as members of a political Party. The Labour Party brought in "One Member One Vote" (OMOV) in a limited way in 1994, and in 1998 the Conservative Party brought in "One Member One Vote" for the Leadership election whilst restricting the number of candidates the membership could vote for to two. Other than these partial reforms the two parties have remained fundamentally undemocratic. Nevertheless these small reforms had a considerable impact. In the first week after the Labour Party adopted OMOV they acquired 10,000 new members. In the first Leadership election held by the Conservatives after their reform 80% of members participated in the ballot.

Time for the Parties to change is running out and a measure of State Funding, granted in such a way that it would encourage membership, will be necessary for a transitional period during which they can reinvigorate themselves.

During recent years, as the Parties became more desperate for funds there have been a number of abuses in fund raising

It is estimated that Conservative Party membership was 2.8million in 1951, falling to 1.5million by 1975 at the time of the Houghton Report into the financing of political Parties. By 1987 it was 650,000. At the beginning of 1993 Sir Norman Fowler, the Conservative Party Chairman of Organisation estimated it was 500,000. Today it is 250,000.

It can be seen from these figures that the Conservative Party has lost on average 50,000 (net) members every year for the last 50 years. In each year between 10-20% new members are recruited. This means that the total loss of members amounts to 90,000 per annum with 40,000 new members joining.

The average age of a Conservative Party member is 65 and rising. Actuarially this means that 45% of the Party’s existing members will be dead within 10 years. An examination of these figures shows that Conservative Party members mainly consist of people born before the Second World War. By their nature and upbringing they tend to believe in the deferential nature of the voluntary Party. It is the age of the men and women that sit on selection committees which is one of the barriers to selecting women candidates or candidates from the ethnic minorities. Elderly people tend to believe that a woman’s place is in the home.

Those people born after the War appear to have joined the Party – stayed a few years – then left. Hence the rising age of the Party. The post war generation were brought up in the age of democracy.

The Party’s approach to membership may be summed up in the membership manual launched at the 1994 Conference. In posing the question "Why do we need members?" of the six reasons given No. 1 was "for the money" and No. 3 "for further funds". The Party has not understood that money is a means to an end and not an end in itself.

Party organisation in many weak constituencies is non existent. 130 Constituencies have effectively no Party organisation. Without radical change the Conservative Party as a Party of mass membership will cease to exist.

In order to understand the reasons for the decline of the Conservative Party we need to go right back to the origins of the voluntary part of the Party. . I set out below a brief history of the Conservative and Labour Parties showing the links between democracy, membership and fund raising. I also set out the way in which State Funding could be used to strengthen those links.

The Conservative Party

The Conservative Party operated under a structure created in the 19^th century

The Reform Act of 1867 brought an extra one million voters on to the electoral register. As a result of this the Conservative Working Men’s Clubs created the National Union of Conservative Associations. The working class origin of the National Union ensured a strong sense of deference to the Parliamentary party. Indeed the National Union was referred to as "the handmaiden of the Parliamentary party". It was not until World War 1 that a President of the National Union was not a member of the House of Lords.

Conservative Central Office was created by Disraeli as his own private office. The three separate parts of the Conservative Party were thus brought into being – the Parliamentary party, the voluntary party and the professional part of the Party.

In the 1880’s Lord Randolph Churchill unsuccessfully called for the accountability of Conservative Central Office – the first time an attempt was made to create a democratic Conservative Party. Thus the two conflicting strands of deference and democratic accountability run through the history of the Conservative Party with deference being the dominant factor.

The end of World War II was a political watershed with the Conservative Party suffering one of its greatest electoral defeats in 1945. There is a remarkable similarity to the state of the Conservative Party today to that which existed in 1945. The membership then was 250,000 and consisted of mainly elderly people. The organisation in the constituencies was weak. The Party had very little money. Lord Woolton became Chairman and by 1951 the membership of the Party was 2.8 million. He believed that the Party had forgotten the ordinary people. He raised £1 million in small donations (the equivalent of £10 million today). The desire for equality and a new era had brought the Labour Party to power. The Conservative Party responded to the challenge by bringing in the Maxwell Fyffe reforms. The most important of which were

to limit the amount of money a Member of Parliament could donate to a Constituency Association to £100.

to recommend that Central Office should publish its accounts.

To have postal ballots for the officers of The National Union.

The £100 limit on the donation a Member of Parliament could give to his Constituency Association was brought in to stop the practice of wealthy people buying seats.

These simple organisational reforms, the change in attitude, the involvement of the Party in developing policies, in other words a cultural change right across the Party completely changed its fortunes.

The second Maxwell Fyfffe recommendation to publish Central Office accounts was not implemented in full until 1993, some 45 years after the recommendation. During that time the ordinary party member could not force the Party to publish Accounts because the Conservative Party then had no legal existence. In a tax case in 1981 - Conservative and Unionist Central Office v. Burrell (HM Inspector of Taxes) – which was to determine whether Central Office should pay corporation Tax or Income Tax on its investment income – it was decided that not only did it not have a legal existence it was not even an unincorporated association. The democratic power of the ordinary member was non existent. You cannot easily change a body that is said not to exist.

The political success of the Conservative Party during the 1950’s and early 1960’s led to reduced interest in making the Party more democratic but the defeat by the Labour Party in the General election of 1964 brought attention to the lack of democracy in choosing the Leader of the Party. Edward Heath became the first Leader of the Party to be democratically elected by Conservative Members of Parliament.

The late 1960’s and early 1970’s saw the Young Conservatives which at this time is reported to have had 250,000 members – today there are approximately 4,500 members of Conservative Future - try to bring democracy to the whole party when they published a pamphlet called "Set the Party free".

In 1970 the National Union Executive Committee set up a committee chaired by Lord Chelmer to investigate "the extent to which the Conservative Party in all its aspects outside Parliament might be made more democratic." A motion which called on the Executive Committee to prepare rules based the principles of the Chelmer Report was passed at the Central Council in 1973, but an amendment was also carried postponing action until after the General Election. After the Election the motion was quietly abandoned and nothing further happened.

The political success of the Conservative Party during the 1980’s deflected any attempt at democratic reform. Equally successful were the attempts by Alistair McAlpine, the Party Treasurer to obtain large sums of money from a relatively small number of wealthy individuals. This success made Central Office increasingly reliant on the few wealthy individuals rather than the mass membership in Conservative Associations. Subsequent events were to prove how financially vulnerable the party was to rely on approximately 200 wealthy individuals rather than the mass membership of the Party. Lose 50 donations in a recession and you lose 25% of your income. Corporate donations now account for a reducing part of the Party’s total income.

The 1987 General Election was a turning point in terms of finance. Having finished the election with an overdraft the party embarked on an expensive refurbishment of Central Office and the expenditure generally began to run out of control With seven Party Chairmen (appointed by the Leader) in eight years each Chairman appeared to adopt the motto – spend the money – win an Election – become a Minister – leave the problem to the successor, with the honourable exception of Sir Norman Fowler. By 1993 there was £19 million accumulated deficit and a bank overdraft of £15 million. In 1996 the revenue deficit had been reduced to £7 million and the overdraft to £2 million. A huge but largely unexplained rise in income to £42 million in 1997 produced a surplus of £7 million. This was just before the General Election. The Party is now at the end of 2001 once again in deficit, despite receiving over £4,000,000 in State funding.

It was under Lord Woolton’s chairmanship that the scheme was introduced by which each Parliamentary Constituency was given a quota to be paid to Conservative Central Office. The quota is based on the number of votes cast in a General Election. It was highly successful when introduced, but today the constituencies are either reluctant or unable to pay any quota. This puts Central Office at a disadvantage compared to Labour’s HQ at Walworth Road. The Labour Party gets approximately two thirds of all membership subscriptions paid to Walworth Road

Politically the strain of having three separate parts of the Conservative Party began to surface in the 1980s. Central Office was the private office of the Leader of the Party and it is still the Leader of the Party alone who appoints the Party Chairman and the Party Treasurer.

The major deficiency is that there is no democratic accountability and Central Office is dominated by the requirements of just one part of the Party – the Party at Westminster

What is required now is a Party Constitution which embraces all sections i.e. the Party at Westminster, the Party in the European Parliament, the Party in local government and the voluntary Party, all brought together with a unified structure served by the professional organisation, and in which democratic accountability is the essential element. The necessity for this unified structure was recognised by Sir Norman Fowler when he created a Board of Management but as Sir Norman appointed all members of the Board, the essential element of democratic accountability was missing. This has now changed and on the present Party Board there are five elected representatives of the voluntary party, but they are elected effectively by constituency chairmen.

Every member of the Party elects the Leader of the Party. An elected Leader derives his or her authority from the whole of the Party. 80% of members participated in voting in the Leadership election in 2001.

Research conducted by I.C.M. shows that a majority of Conservative Party members want to have a vote in the election of the Party’s officers, which would include the Party Chairman and the Party Treasurer. Even now the Party is not genuinely democratic. The members of the Party cannot change the Constitution of the Party on the simple basis of One Member, One Vote. That is the real test of democracy.

The Labour Party

Similar problems to those which affect the Conservative Party have beset the Labour Party. From a high of 1.0 million members in 1951 Labour Party membership declined to 250,000 in 1993. However, whereas the Conservative Party has always relied on its mass membership for fighting elections, the Labour Party traditionally turned to the Trade Unions.

The Trade Unions provide a substantial part of the Labour Party’s income. The late 1960s and the 1970s saw the increasing dominance of the Trade Unions in the Labour Party which culminated in the winter of discontent in 1978/79 It was brought home to the British public that the Labour Party was wholly undemocratic and it became unelectable. Neil Kinnock understood this and tried to reform the Labour Party as did his successor John Smith. Although John Smith had some success with OMOV (one man one vote) there are still democratic fault lines within the Labour Party with the Trade Unions still controlling 50% of the votes at the Party’s conference. Of the £18.50 minimum subscription to the Labour Party £6.25 remains in the constituency, and £12.25 goes to Labour Headquarters. There has recently been proposed a substantial increase in these figures.

Following the death of John Smith in 1994, the new OMOV provisions were implemented for the Leadership election. The Labour Party can be criticised for the details of how OMOV was exercised, with the possibility of some members having up to 20 votes. However the significance of the election is that within the first week of the introduction of OMOV 10,000 people joined the Labour Party and between 1994 and 1997 Labour Party membership increased to 400,000. It has since fallen to 250,000 as those members that joined realised during the selection for the Leader of the Welsh Assembly and also during the selection for the candidate for Mayor of London that with its electoral college system the Labour party is fundamentally undemocratic. Of the 250,000 only 70,000 pay the full subscription. Nevertheless prior to 1997 the public perception of the Labour Party was changed and the Party had again become electable.

Due to the public relations impact of OMOV the British public does not realise that the ordinary members have only one third of the votes in the leadership election, the other two thirds go to the parliamentary party and the affiliated organisations. The discredited Electoral College system is used extensively in the Labour Party for elections. The Chairman of the Party is now appointed. You can be a member of the Party if you live anywhere in the world including Eire unless you live in Northern Ireland. It is a scandal that people living in the United Kingdom are barred from joining the Labour Party.

Now that the Labour Party is in government we are beginning to see many of the practices used by the Conservative Party to raise funds implemented by the Labour Party. Blind trusts, front companies, patronage, receptions at 10 Downing Street, big individual donations as exemplified by Mathew Harding and Bernie Ecclestone are all now being used by the Labour Party. The financial pressure on the Labour Party inevitably eased for a while as these practices brought in the cash but in this process it became highly vulnerable, just like the Conservative Party. It is a dangerous course of action.

As the perception of democracy beings to fade the Labour Party is following the same path as the Conservative Party with a declining membership.

Single Issue Pressure Groups

The two main political parties in Great Britain have fundamental democratic fault lines running through them. The ordinary Conservative and Labour Party members feel that they have no say or influence on the Party to which they belong. We are moving rapidly into the era of the Pressure Group. The young in particular have realised that due to the undemocratic nature of our two main political parties they are more likely to change policies by joining a pressure group rather than one of the main parties. The Royal Society for the Protection of Birds has a million members, four times the membership of the Conservative Party. Greenpeace has 400,000 mainly young members thus illustrating that young people will get involved with political issues if they feel that what they say counts.

The turnout at the last General Election was at 59% the lowest on record. A false comparison is often made with the election of 1918 but in that election 14% of the seats were not contested. Turnout of young people was particularly poor. Today people are better informed than ever and they are aware that 55% of legislation affecting the United Kingdom emanates from the European Union yet because of the closed Party list system the people cannot choose the person they wish to represent them in the European Parliament. They also see multi-national corporations like Microsoft that are more powerful than national governments. With the end of the "Cold War" there is now only one super power in the world and that is the United States. It is seen to exercise global power without global accountability both at a military level and an economic level. The imposition of tariffs on steel, the ignoring of the "Kyoto" agreement on the environment, the massive subsidy to its farmers are examples of decisions taken by the United Sates government which have a great impact on the rest of the world but in which the rest of the world had no say in the decision making process.

Young people are particularly concerned with the environment, third world aid and the economy. Is it any wonder that in these circumstances they see the politician at Westminster as at best ineffective and at worst irrelevant? Only by making our institutions at all levels including our political parties more democratic will we overcome the antipathy, which the people now feel towards democracy.

The next General Election could see the Liberal Party move into the vacuum created by the two main parties, not on a positive vote, but because the British Public have said "A plague on the Labour and Conservative houses".

People want to be involved in decision making which affects them. The speed of change is increasing and only democracy can force organisations to keep up with that change without the requirements for bloody or bloodless coups. Because of their undemocratic nature both the Labour and the Conservative Parties are caught in a time warp unable to change rapidly enough to meet the aspirations of the people. All our institutions are under attack because they belong to the age of deference whilst we are moving into the age of democracy.

The Conservative Party needs a constitution, which would make those that run the Party democratically accountable to the membership. The officers of the Party would be elected and those elected officers would control Conservative Central Office. Members of the Party feel that they must have a say in the way in which the Party works. Until this happens the Party will continue to decline.

The Labour Party also needs to become genuinely democratic. It cannot be right that a National Political party should be so dependent on the vested interests of a particular group – the Trade Unions.

State Funding

The State is already involved in the funding of political Parties the main areas being as follows:

Finance for the Office of the Leader of the Opposition.

All Parties in Opposition with two or more MPs receive some financial assistance for their Leader’s office. This is a legitimate use of funds as it strengthens the democratic process by balancing out the inherent advantage a Party has in government. The funds should be publicly accounted for and not be excessive. The level of them should be the equivalent of the amount of money, which the Government spends, on political advisers. At present the Government employs over 80 political advisers at a cost of £5.1 million having almost doubled the number since the Labour Government took office. The number of political advisers employed by the Government should not exceed 50. This should produce a significant saving.

Free post at a Parliamentary election.

In the age of direct mail, computer targeting, E-mail, and the Internet, the "free post" could easily be scrapped without any detriment. It has increasingly come to be used by individuals for cheap subsidised publicity. The case for it to be continued is not strong for although it may help candidates who have no organisational back up, a candidate with serious intentions of trying to win an election would not be deterred by there being no free post.

Party Political Broadcasts (PPBs)

The British public is very sceptical about PPBs. Statistics included in them are usually slanted in favour of the Party broadcasting. However if the parties do benefit it is at the expense of the smaller Parties. There is, therefore, an inherent bias towards the status quo and as a result of this are dangerous for democracy. Increasingly large sums of money are spent by the Parties on these Broadcasts. That money would be saved if they were abolished.

MP’s expenses allowances.

There is a growing trend for functions which were done by a constituency association and paid for by the association to be done and paid for by the Member of Parliament. In 1948 the "Maxwell Fyffe" rules were adopted in the Conservative Party which limited the amount a Member of Parliament could give to his Association to £100. This was brought in because many Associations in choosing their parliamentary candidate were doing so on the basis of the amount of money the candidate would donate to the Association. There is a real danger of this practice once again becoming prevalent except that now most of the funding will be from the taxpayer. The current practice seems to have developed initially in the offices of European Members of Parliament where" information funds" and "high expense allowances" are normal. The further danger of this practice is that the Member of Parliament instead of relying on his Association or local grouping is able to dictate to the Association. The Association, as it no longer has to raise the money, rapidly goes into decline, becomes out of touch with its membership, becomes a small rump thus then justifying the MP dictating matters -–a vicious spiral. The practice should cease.

Since the beginning of 1992 when MP’s expense allowances were dramatically increased, many Constituency Associations have been and are still being subsidised by Members of Parliament out of their expense allowance. With the recent huge increase in these allowances many functions which used to be performed by the local Constituency Association are now being done by the MP’s office. Millions of pounds of state funding are going to constituencies by the back door. Already Members of Parliament are beginning to use this financial lever to control their Association and Constituency Associations are asking how much a prospective candidate will pay before choosing their Parliamentary candidate. This will further alienate the ordinary member from belonging to the Conservative or the Labour Parties.

Because of the scale of Tory losses in the last two General Elections the Party in the constituencies has lost a significant source of income. This source is now being exploited by the Labour Party.

Furthermore as the Constituencies have become weaker the Member of Parliament has become less accountable. No longer does the MP fear being asked to appear before a large Executive Council to account for his or her actions. It is not surprising therefore that the bonds which ensure loyalty to the Party have become weaker and an increasing number of Conservative Members of Parliament were able to be disloyal to the Party without having to account for their actions particularly during the 1992-97 parliament.

State Funding – Constituencies

The greater the membership of our political Parties the more the membership will represent the people rather than vested interests. The strength of our democracy rests on our having political Parties with mass membership. The Member of Parliament meets and is influenced by his local Association. The main objective of a Constituency Association is to fight and win elections. It can only do this if it has people and money. Membership and fund raising are, therefore, essential ingredients in every Association. Whenever Associations are not fighting elections they can be raising money. This keeps them together as a body. Anything that detracts from this weakens the Association. If an Association did not have to raise money it would inevitably only attract those people with high political motivation. 90% of Party members are content to attend fund raising activities without becoming deeply involved. They provide a stabilising influence on the extremist. Without the requirement for fund raising the politically motivated extremist would take over. State funding to the Constituencies would weaken them and, therefore, should not be done.

State Funding – Headquarters

It is often said that Walworth Road or Smith Square are out of touch with the grass roots of their Parties. This is not surprising for both Parties are essentially undemocratic. The Labour Party is dominated by the Trade Unions. Conservative Central Office still acts as the private office of the Leader of the Conservative Party. The "members" of the Parties by direct elections do not control either Party organisation. There is, therefore, no democratic accountability. With this situation existing it is, therefore, understandable that Constituency Associations are sometimes reluctant to pass funds to their headquarters. It is essential that political Parties should have an elected Chairman and Treasurer answerable to the membership

With democratic accountability in place the stronger the bond would be between the headquarters of the Parties and the Constituency Associations thus encouraging Constituencies to finance more of the activities of headquarters and making headquarters reliant to a greater extent on the Constituencies. State funding could weaken that reliance and thus weaken the influence of Constituency Associations.

State Funding – Tax Relief

Generally speaking only the relatively wealthy complete tax returns. Out of the entire population only approximately 9,200,000 tax returns are submitted. It is therefore thought that any system of State funding based on tax relief would have a bias towards the Conservative Party. It is not a fair system for it would not encourage the poor to participate.

The Methods by which Parties are at present financed

The main source of income for Constituency Associations is and should be membership subscriptions, for this creates the greatest number of positive links between the Association and the electorate. Probably about half an Association’s income could be derived from this source. The other half being made up by fund raising activities such as draws, barbecues, dances etc.

At headquarters the Labour Party derives most of its income from a few large Trade Unions whilst Conservative Central Office derives the bulk of its income from a relatively few large individual donations and a relatively few large company donations. The motives for these large donations must be questioned.

Regarding Trade Unions and Companies the decisions are taken by a small number of people and secondly, often the size of the donation can only be such to make one suspect that influence is being sought for one reason or another.

Adequacy of funds for the tasks Parties perform

There is no limit to the amount of money that could be spent on propaganda, research etc. The more money a Party has the more it will spend. Expenditure is a bottomless pit. State funding, will find growing demands for it to be increased. Parties, like individuals, must live within their means. Even the prospect of state funding could encourage the Parties to overspend and inevitably any state funding would be biased towards the status quo – a danger for democracy. Just as there is a limit on how much may be spent in a constituency during an election campaign there should also be a limit on the amount that may be spent nationally. Special provisions should be made regarding the limits of expenditure in by-elections, where at present there is widespread abuse.

Desirability or otherwise of controls over sources of finance

The Electoral Commission should demand that the accounts of political organisations be filed and audited. It should ask for audited returns relating to particular fund raising activities.

The Commission should ask for audited financial statements, which would usually comprise:

An Income and Expenditure Account

A Balance Sheet (or more than one if considered appropriate for specific funds.)

Notes to the Accounts which would include a statement on the accounting policies adopted.

The Registrar should also ask for a copy of the organisation’s rules and constitution.

Statutory requirements on donors or recipients

Political parties should receive their income from individuals who are electors in the United Kingdom or hold a United Kingdom passport. Politics should not be influenced by organisations lobbying for particular causes or courses of action because of the amount of money they give to a political party. Similarly foreign governments, organisations or individuals should not be able to exercise undue influence by their financial contributions.

There is a financial level at which support for a political Party from individuals turns into financial influence. That limit should be set at (say £5,000) and should not be allowed to be exceeded.

There will no doubt be attempts to circumvent the limits by interest free loans, free advertising, sponsorship, etc and the Electoral Commission needs wide powers to prevent abuses.

Conclusions

At present the State directly funds political parties in the amount of £7.3million per annum. In addition, special advisors to the Government are paid £5.1million. The question that has now to be addressed is not so much as to whether there should be State Funding, but if it is to be justified on the basis that it is to enhance our democracy, what conditions and requirements have to be met by those recipients of the funding.

We have set out in this paper the links between party democracy, membership and fund raising. There is no doubt that healthy political parties should be capable of raising from the public sufficient funds to sustain themselves. It is equally clear that for their own internal reasons the two main parties have pursued large donations from a few individuals and in the process have created a public perception of sleaze. They have avoided the option of raising funds in small amounts from a large number of people because without democratic reform of the parties their pleas would fall on deaf ears.

The solution to their problem requires the recognition of the calamitous financial state that the parties are in and that State Funding should be strictly limited to assisting the parties to overcoming their temporary difficulties. There should be a time limit on the main element of funding. In order to eliminate the public perception of sleaze the maximum size of any donation from an individual should be limited to £5,000.00. The parties should be democratically accountable to their membership. The limit on donations becomes less important if the parties are democratically accountable to their members for it would make it more difficult to obtain influence in such circumstances. All these steps are taken to enhance democracy and should be conditions imposed on the parties prior to them receiving State Funding.

The simplest way for these objectives to be achieved is for the State to pay a per capita amount (say £20.00) to each political party dependent on the number of audited members of the party paying a minimum subscription of £10.00. Such monies paid should be reduced each year by 20% thus eliminating the subsidy over five years. This would give the parties time to increase their membership to the point where they are self-financing.

It seems to me that we have become mesmerised by the electoral success of "New Labour" and are seeking to out do it on its own natural territory. "New Labour", like the Thatcher revolution of the 1980s is, in my view, a passing fad which will have its glory days and then be gone.

Margaret Thatcher made many enemies and might possibly be regarded as the most vilified Prime Minister in history. Even today, nearly 12 years after leaving office, she is still regarded by man as an ‘evil bitch’; heartless, selfish and cold. Tony Blair is considered distant, aloof, arrogant, mesmerised by rich superstars such as Posh and Becks and a poodle of President George Bush. He is seen to have a ‘pushy’ wife intent on furthering her own career and of ensuring that his children have the best possible education under the church/state system, topped up by private tuition. Yet one cannot deny his success electorally in drawing to the Labour Party people who would not vote for it in normal circumstances.

It is hardly surprising that young people are put off voting and distrust and despise all politicians. Iain Duncan Smith is regarded in much the same way as William Hague – a decent chap but hardly prime ministerial material and is seen as someone who opts for an Eton education for his son and who, by this fact alone, has no interest in the state system which 92% of our children have to endure whether they like it or not. This same group regards Blair as an opportunist who pays lip service to the state system by bussing his children to the London Oratory, one of the top comprehensives in the country…

The charge against Blair but one which our leaders seem incapable of exposing must surely be this: he has allowed his Chancellor to raise public spending to £500 billion plus by 2005/2006 in what may well turn out to be an unsustainable boom which may lead to higher taxes and secondly he is actively encouraging, by various tax credits, over one third of the population to become dependent on state benefits and state handouts for their sole source of income.

Too many people at the top of our Party are jockeying for positions and are playing the "who is going to be the next leader?" game. Too many others, some of our best known figures – Hague, Portillo and Dorrell – are content either to just serve their constituents and write occasional newspaper articles or to make television programmes on either musical composers or on the Euro. We are not even talking to ourselves let alone the country.

Take the foot and mouth crisis of the early months of last year. The Government’s handling of the situation was disastrous resulting in much greater slaughter than there need have been. At the time our then leader, William Hague, was pooh-poohed for suggesting that the Army be brought in immediately. It now transpires that if Hague’s suggestion had been taken up, the outbreak might have been contained sooner. we have had no word of apology from the Government, many of whose MPs on the back benches regard farmers as greedy, over-subscribed Tory voters who like hunting.

The Government is navigating choppy waters - it has plenty of problems, believing it can solve the continuing disquiet with public services, notably Health and education, by throwing taxpayers money at them willy-nilly. The reforms it promises will never come because it lacks the will to take on the public sector unions who are after all its paymasters and raison d’être. More and more people – even those on comparatively modest incomes – are taking out private health insurance or are paying for private health insurance or are paying for private tuition in the case education. In the matter of health, I have always felt it right for there to be a Health Service, free at the point of delivery, for all those who need treatment when they are ill. It does not matter to me who provides it, as long as there it’s there. Similarly, I have never been an enthusiastic supporter of the comprehensive system because it has meant the destruction of many fine grammar schools which had academically, although not socially, proved themselves over many years.

Why then am I, a man from the working class, not a socialist? Socialism has little appeal for me because it relies on rigid control, compulsion and destruction. The late Tony Crosland failed to close every grammar school in the country. Thirty-five years later and 25 after his death there are still over 160 of them in the country and to judge by the latest tables 90% of them occupy the top 50 places in terms of examination success. Socialists believe that the State knows what is best for the individual – and some of them, like Dennis Skinner MP will tell you that. Others, while believing in equality, will milch the current system when it suits them. Their line is: I really am a socialist BUT (with the emphasis on the word BUT).

I maintain that it is better for us not to try and outbid the Labour Party in the public spending stakes – it is dead water for us. We will never win the argument partly because many of our leaders, although not all, prefer to go private in the matter of health and education. In the past that has not been an insurmountable barrier – Margaret Thatcher won three elections even though she used private hospitals and sent her son to Harrow. But to counter this she had a couple of ‘big’ ideas, which appealed to many, notably the sale of council houses to sitting tenants and the taming of the Trade Unions. These had an appeal because in the case of council houses it gave people an opportunity to buy a property they might otherwise have rented for 40 or more years. The curbing of union power shoed that workers who were not in a union also had rights as they too were wealth creators. So we need a few ‘big’ ideas.

But not only that. We need people who can communicate with the ordinary mass of the public. So it is no use choosing an old Etonian ‘Hooray Henry’ for this task. To reconnect with the voters we need to apologise for past mistakes – the ‘poll tax’ of the early 90s, the recession at that time and the ERM debacle already referred to. It is noticeable that these three major mistakes took place after we had been in government for more than 10 years. 33% of those who voted in 2001 supported us but 67% did not. We should find out why we were deserted by them and act accordingly. Certainly we need to broaden our appeal but do not let us sacrifice our principles in so doing. We seem to be caught in a dilemma as to whether or not we should cut taxes and how much we should spend on the public services. The general public is sceptical as to whether the Chancellor’s largesse will improve things more than marginally, yet they are unwilling to trust us. Unless and until we regain that trust and start talking sensibly about the public’s genuine concerns we are going to remain marginalised and seemingly irrelevant. Unless we can learn from past mistakes we will, I fear, continue to lose seats to the Liberal Democrats in particular. The recent death of the former Conservative MP for Lewes in East Sussex, Tim Rathbone, brought this home to me. In 1997 the Liberal Democrats overturned his majority of 12,000 by a thousand or so votes which in 2001 they managed to increase to 10,000. We have a lot of hard work to do when so called safe seats such as Lewes, Conservative for over 60 years, have been allowed to go down the pan.

We need our leaders to have vision and to stand up and say: "This is what we believe and this is how we will go about it". If we think the State should consume only 35% on the nation’s wealth and that people are better off in making some provision for themselves independent of the State, we should not be afraid to say so. We once won an election on the slogan – "Set the people free".

I believe that the distinction between income tax and national insurance should be abolished, so that people can actually see in one lump sum how much of their earnings they are handing back to the Government. The raising of the National Insurance contributions in the last Budget allowed Gordon Brown to claim, quite rightly, that he was not putting up income tax. All he has done is to raise the money in another way. The general public, companies and public corporations are undoubtedly paying more tax in 2002 than in 1997 although this is often camouflaged by ‘dodgy’ accounting practices. Yet there has been no mass revolt, no rioting and such - just a weary resignation, and a hope that things will improve. Our Party is incapable of giving a response because it is afraid of being dubbed ‘privatisors’ and miserly in respect of public spending. And I would be the first to admit that in a country where health and education are provided free by the State, the idea of providing for yourself and your family instead of the State acting as a universal ‘sugar daddy’ is not going to be very popular.

The universal complaint from both teachers and nurses is that they are not paid sufficiently well for the kind of work they do. (And with firemen now talking about a wage of £30,000 per year, who can blame them?) The NHS employs over 1,000,000 people, second only to the Red Army. To give them what they want would mean an unacceptable rise in taxation, borne by other workers, and companies already reeling under higher taxes and bureaucracy. Yet the vested interests seem completely oblivious of this and of the additional rights and protection they have been given since 1997. The truth is surely this: whatever we are given, we will always want more.

I end on a happier note. Here in Wales we do not have any Parliamentary representation at Westminster. In the Welsh Assembly, one of our Members was elected by the first pas the post system and the other eight through proportional representation. Although in a minority, we have some excellent Assembly Members who work hard for their constituents. Next year new elections will be held and I have just sent my ballot paper in nominating our South Wales Central candidates in order of preference 1 to 8. Our present two Assembly Members are seeking re-election . One of these is the youngest \Member of the present Assembly, (aged 17). We have two women candidates, a couple of students in their early 20’s. They come from varied backgrounds and are what I would call ‘in tune’ with the general public as a whole. Even though we may have an ageing membership, we do still have a long FO young people involved in the Party at the highest levels. We must continue to encourage them to participate and not be distracted by internal divisions over our attitude to certain specific issues, some of which are irrelevant to everyday life.

This Government needs to be exposed for what it is – bossy, meddling, bureaucratic, wedded to state interference, economical with the truth when it suits and a tendency to belittle anything it does not regard as part of the ‘project’.

Can we Conservatives rise to the occasion or is it too late?