Labour on the rack as Ecclestone affair resurfaces

Published on Tuesday 16 April 2002 01:00

THE Bernie Ecclestone affair returned to haunt Tony Blair yesterday as Downing Street struggled to shrug off allegations that the Labour Party was in hock to big business.

With No 10 under siege over a string of claims that the government had favoured business donors to Labour, the opposition demanded Mr Blair come clean about the role of his key adviser, Jonathan Powell, in securing a 1 million donation from Mr Ecclestone, the Formula One chief.

Two senior figures from motor racing claimed yesterday that Mr Powell had been instrumental in initiating discussions with Mr Ecclestone about making a possible donation to Labour prior to the 1997 election - allegations strenuously denied by Mr Powell.

The revelations raised fresh doubts about Labour’s relations with big business and prompted calls for Downing Street to clarify the role of Mr Powell, a backroom operator who is one of the most powerful men in the No 10 hierarchy.

According to David Ward, a former Labour aide who now works for the international automobile association (FIA), he was approached by Mr Powell in 1996 to inquire whether Mr Ecclestone would become a Labour donor.

Mr Ward’s account was corroborated by Max Mosley, the FIA president, who said the revelations about Mr Powell were "quite accurate".

Shortly after Mr Ecclestone made his donation, it is alleged Mr Powell arranged a meeting between the Formula One chief and Mr Blair at Downing Street. Just days later, the government announced Formula One would be exempt from a proposed ban on tobacco advertising.

The event marked one of the darkest days of Mr Blair’s first administration, forcing the Prime Minister to appear on television to defend his reputation for honesty.

Despite the evidence from Mr Ward and Mr Mosley, the Labour Party disputed Mr Ward’s version of events and insisted Mr Powell had not been involved in soliciting a donation from Mr Ecclestone.

But Dr Liam Fox, the shadow health secretary, said it was clear Labour’s policy making and its political funding were inextricably linked.

"It seems the Labour Party is for sale," he said.