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Labour has hosted major party donors at No 10 for a drinks reception, as the party comes under growing pressure from MPs and unions to consider a donations cap.
The Guardian understands that high-level donors, including business leaders and philanthropists, were hosted by cabinet ministers in Downing Street for an evening reception on Tuesday. Donors from the party’s Rose Network give thousands of pounds a year to the party.
Andy Burnham is under increased pressure from MPs to consider new restrictions for domestic donors after Reform UK received £72m from two cryptobillionaires, Ben Delo and Christopher Harborne, over the course of 48 hours. A Labour source said the donors event had been organised in advance of the Reform donations news.
Over the weekend, Labour also stepped up fundraising from members, directly in response to the donations. The party’s chair, Bridget Phillipson, sent out two fundraising emails – understood to have both raised significant sums – calling on members to step up.
The Labour email said Reform had secured “record-breaking financial backing – but for us it has to be a call to action … We cannot let less than a handful of extraordinarily wealthy crypto-billionaires simply drown Labour’s message out in elections to come [with] Reform dominating what voters see and hear, Labour fighting to be heard.”
The follow-up email had a message from Phillipson saying: “When I saw that two crypto-billionaires had given Reform £72m, I had the same thought you probably did: how do you compete with that?
“Then I watched the response from Labour supporters. People donated what they could … One person can’t match £72m. But thousands of us, standing together, can make sure Labour is as well-resourced for the fight ahead as it is possible to be.”
On Tuesday, trade union leaders at the TUC stopped short of backing a cap on political donations, but called for further action on big money in politics.
General secretaries have been split on a call for unions to back a specific cap on individual donors to political parties while protecting trade union donations, which the TUC said were the “cleanest money in politics” because they came from workers’ subscriptions.
The TUC’s general secretary, Paul Nowak, said the donations to Reform were “a blatant attempt to effect a corporate takeover of our politics” and this should “ring alarm bells”.
Downing Street, however, will take some succour from the warmer tone of union chiefs towards the party leadership at the annual TUC gathering in Brighton this week.
Since 2020, Labour has received almost £43m from affiliated trade unions, which raise their money through individual workers’ membership fees.
Sharon Graham, the general secretary of Unite, who had previously threatened to break the link with Labour, said Andy Burnham had earned the party a “second hearing”.
Several other union leaders spoke of warm chats with the prime minister since he took office, and felt they were getting more of a hearing than when Keir Starmer was in No 10.
However, despite welcoming the “Burnham bounce”, which they saw as giving Labour a better chance of fighting off the Reform threat, they warned there were key tests ahead for the government, including at the budget.
Labour is under significant financial pressure, especially after several byelections, including the Greater Manchester mayoralty.
Its most recent accounts filed with the Electoral Commission show Labour has lost more than a fifth of its membership in the space of a year, though party sources have said membership had gone up in anticipation of a possible leadership election, and since Burnham became prime minister.
Income from donations has dropped by 84% since the election year, a drop that would be expected but is still significant. Last year, the party reported a £2.6m deficit. One union leader said the party was still “millions” in the red.
However, Labour’s outgoing general secretary, Hollie Ridley, was understood to have told the party’s governing national executive committee that finances were healthy. She said the party was in its strongest financial position since the general election, due to spending discipline and increased fundraising efforts.
