Deputy Leadership Campaign (Source - Wikipedia)
On 12 September 2006, Peter Hain announced his candidacy for the position of Deputy Leader of the Labour Party. In January 2007, Hain gave an interview to the New Statesman in which he made his pitch for the Deputy Leadership and referred to the Bush administration as "the most right-wing American administration, if not ever, then in living memory" and argued that "the neo-con agenda for America has been rejected by the people and I hope that will be the case for the future". Hain was eliminated in the second round of the Deputy Leadership election, coming fifth out of the six candidates, with Harriet Harman being the successful candidate.
Successfully nominated candidates
- Hilary Benn — 47 nominations.
- Hazel Blears  — 49 nominations.
- Jon Cruddas — 49 nominations.
- Peter Hain — 51 nominations.
- Harriet Harman — 65 nominations.
- Alan Johnson — 73 nominations.
All six declared candidates secured more than the 45 nominations from MPs that was the minimum requirement for them to get onto the ballot paper by close of nominations at 12:30 UTC+1 on 17 May 2007.
The election took place using Alternative Vote in an electoral college, with a third of the votes allocated to MPs and MEPs, a third to individual members of the Labour Party, and a third to individual members of affiliated organisations, mainly trade unions. So in the tables below, each of the first three columns adds up to 33.33%.
Harriet Harman won the contest, her victory heavily depending on support from individual party members with preference votes narrowing her opponent's lead and she only led in the final round. The final total percentage votes for the two main candidates after redistribution were almost identical to those of the final round of the 1981 contest.
The amount of donations made to each candidate for their campaigns were:
- Hilary Benn — £4,000
- Hazel Blears — £73,000
- Jon Cruddas — £143,000
- Peter Hain — £180,000-£200,000
- Harriet Harman — £46,000, plus £50,000 of her own loans
- Alan Johnson — £54,000
Resignation following Labour Party Deputy Leadership Donations Scandal
In January 2008, The Guardian reported that Hain had failed to declare some 20 donations worth a total of over £100,000 during his deputy leadership campaign and would be investigated by the Electoral Commission. Hain admitted "deeply regrettable administrative failings" but faced questioning on whether the oversight was due to changes in campaign manager possibly causing "chaos" during the campaign or the desire of some donors to remain private. Phil Taylor, the first campaign manager, said that Hain insisted on knowing who had donated and that it was legal. His campaign only reported a separate £82,000 of donations and the Guardian believes he stopped taking a personal interest in funding once the campaign ended though there was no evidence that he deliberately broke the law. Isaac Kaye, who had previously paid the National Party in South Africa, also made a payment to the campaign for Labour Deputy Leadership.
Taylor's successor was Steve Morgan, and it later emerged that four donations were channelled through a non-operating think tank, the Progressive Policies Forum (PPF) which may be connected with Morgan, who was named as a donor. On 12 January, Peter Hain released a statement saying that he wanted to get on with his job and it was absurd to think he had deliberately hidden anything. John Underwood, a trustee of the PPF, said that the donations and loans were "entirely permissible", though Hain said he would pay back a £25,000 interest-free loan.
On 24 January 2008, he resigned from several posts including his position as Work and Pensions secretary, after the Electoral Commission referred the failure to report donations to Metropolitan Police. He cited a desire to "clear his name" as the reason for his resignation. Peter Hain was the first person to resign from Gordon Brown's cabinet. He was replaced as Secretary of State for Wales by Paul Murphy, and as Secretary for Work and Pensions by James Purnell in a forced cabinet reshuffle.
Peter Hain's campaign failed to declare £103,156 of donations, contrary to electoral law. On 3 July 2008, the Metropolitan Police announced that they had referred Peter Hain's case to the Crown Prosecution Service. On 5 December 2008 the CPS announced that Hain would not be charged because Hain did not control the members' association Hain4Labour that funded his campaign.
In January 2009 the Standards and Privileges Committee of the House of Commons published its report into Peter Hain's failure to register donations. It concluded:
"In his brief but thorough memorandum, the Commissioner has reported the outcome of his inquiries involving 19 cases of late registration of donations, totalling over £100,000. We agree with the Commissioner that Mr Hain’s failure to register donations on this scale is both serious and substantial. We are bound to take this into account, notwithstanding the facts that Mr Hain has apologised unreservedly, and that he acted with commendable speed to rectify his omissions once he discovered them, without waiting for others to invite him to do so. Because of the seriousness and scale of this breach and noting the considerable, justified public concern that it has created, we would ordinarily have been minded to propose a heavier penalty. However, we accept that there was no intention to deceive and Mr Hain has already paid a high price for his omissions. We therefore recommend that Mr Hain apologise by means of a personal statement on the floor of the House."
Peter Hain apologised to the House of Commons on 26 January 2009. His apology is set out below.
"My failure to declare to the Registrar of Members' Interests, within the time required, all of the donations to my campaign for the deputy leadership of the Labour Party was wrong," he said.
"I note that the Committee fully accepts that I acted with 'commendable speed to rectify' this once I had discovered the problem - indeed a month before any complaint was made against me - and that there was 'no intention to deceive'. I have always accepted full responsibility for this honest mistake and I apologise unreservedly to the House."
FULL DECLARATION OF DONATIONS
04.06.07 £10,000 Mike Cuddy
THE CONTROVERSIAL DINNER
On 20 January 2008 the Sunday Times reported on the following regarding the donations to Peter Hain's campaign:
PETER HAIN has been accused of “sailing close to the wind” over a string of campaign donations each for £1,000 - just 1p below the threshold at which they would have had to be declared.
The embattled work and pensions secretary - who is also the Welsh secretary - received the cheques from wealthy businessmen who were asked at a dinner in Cardiff to support Hain’s bid for the deputy leadership of the Labour party.
The Cabinet minister is already battling for his political life after he failed to declare £103,000 of campaign donations above the £1,000 cut-off point to the Electoral Commission. Gordon Brown said last week that Hain had been “incompetent”.
Hain’s wife, Elizabeth, a recruitment consultant and former Welsh woman of the year, and Shaun Woodward, the then broadcasting minister, were also at the dinner at the members-only Park House club last April.
One of the 12 businessmen present has told The Sunday Times that each guest at the four-course dinner was asked to make out a £1,000 cheque to Hain4Labour and send it to the Cardiff offices of Morgan Allen Moore, the lobbying firm run by Hain’s chief aide, Steve Morgan.
Among the donors were John Underwood, one of Hain’s campaign advisers and a director of the Cardiff-based public relations consultancy Freshwater. Another donor was Underwood’s boss at Freshwater, Steve Howell.
Howell acknowledged last night that his company had a contract with the Welsh Assembly.
But he insisted that he and Underwood made the donations in a personal capacity.
He said: “It is a free country. People can give money to political causes. There is a fundamental democratic issue here. It wasn’t anything to do with Freshwater. It was my own money. I have also given money to the Barack Obama campaign.”
The other guests included Russell Goodway, the chief executive of Cardiff Chamber of Commerce, Brian Morgan, chairman of the Welsh Whisky Company, Sir Roger Jones, the venture capitalist, and Frank Maloney, a Cardiff-based businessman who advised the rock radio station Xfm on its bid for a licence to broadcast in South Wales.
David Davies, Conservative MP for Monmouth, said: “Peter Hain is sailing very close to the wind. Politics has to be seen to be fair.”
A spokeswoman for Hain said: “All donations above the declarable threshold have been registered with the Electoral Commission and the Register of Members’ Interests. Peter is satisfied that no conflicts of interest arose from the financing of his deputy leadership campaign. Peter is getting on with his government jobs.”
Hain is the subject of two separate investigations by the Electoral Commission and the Commons standards commissioner.
He is also expected to face questions this week about a possible conflict involving the work of his wife who, under the name of Elizabeth Haywood, is managing director of KMC International, a headhunter that specialises in finding jobs for senior figures in the public sector.
KMC was given “preferred supplier status” by the Cabinet Office to fill Whitehall positions, including those to the DWP.
Hain has declared his wife’s professional interests to the most senior civil servants in the Welsh Office and the Department for Work and Pensions. Ray Ruddick, 55, the Newcastle builder who gave £196,850 to the Labour party on behalf of the Tyneside property developer David Abrahams, has been questioned under caution by the police.
He said that Janet Kidd, the secretary who also channelled illegal donations to Labour from Abrahams, had met police separately under the same terms.
In his autobiographical book "Outside In", there is curiously no mention of the Standards and Privileges Committee Report into Hain's failure to declare donations, nor to Peter Hain's apology to the House, a surprising omission as it is doubtful an MP could forget having to stand up and apologise to his contemporaries. In his book, Peter Hain described the Deputy Leadership bid and the subsequent fallout as "a searing experience, the biggest mistake of my political life". His wife Elizabeth and his family had not wanted him to run for the vacancy, nor had Howard Davies, his agent he describes as his "talisman".