PETER HAIN failed to declare more than £100,000 in donations to his unsuccessful bid to become Labour's deputy leader, and admitted last night that he should have given the matter "higher personal priority".
The Welsh Secretary has faced a series of questions after it emerged six weeks ago he had failed to register some donations with the Electoral Commission, as candidates are obliged to do by law.
But Mr Hain conceded last night that the £82,000 he had originally declared was dwarfed by the £103,156 that he has now had to add to the total.
The Neath MP eventually came fifth in last year’s contest behind eventual winner Harriet Harman.
He said, “The fact is that during this period, I gave my campaign for office within the Labour Party second priority to my government responsibilities.
“I reasonably believed that the arrangements in place for my deputy leader campaign would be sufficient to ensure compliance with reporting requirements, but as it transpired, due to administrative failings this was not the case after early May.”
Problems came to light when it emerged in November Mr Hain had not declared a £5,000 donation from Jon Mendelsohn, who went on to become Laobur’s chief fund-raiser. The Western Mail revealed that he had also failed to register £1,300 from a fundraising dinner in Cardiff.
Mr Hain’s final total of more than £182,000 dwarfs the money raised by other candidates, including Ms Harman. He insisted the newly-revealed donations had come from people who were all “legally entitled” to contribute.
However, he acknowledged widespread bafflement at how such a large sum could have been received without being registered. “I understand that people will ask how I could have allowed this number of donations to go undeclared at the time,” he said. “I very much regret that these reports were not made on time. I should have given higher personal priority to the day-to-day administration and organisation of my campaign.”
Mr Hain, pictured right, also released a full list of the 17 gifts which were not declared.
They include £10,000 on June 4 from Mike Cuddy, who runs Neath-based building contractor the Cuddy Group.
A further £10,000 was received from the GMB trade union in September.
And some £26,613.75 in donations and a £25,000 interest-free loan were made by individuals through the Progressive Policies Forum think tank.
The pressure on Mr Hain, also Secretary of State for Work and Pensions, increased yesterday as Westminster’s new anti-sleaze watchdog announced it would investigate the way his campaign was funded.
Sir Christopher Kelly, the newly-appointed chairman of the Committee on Standards in Public Life, said the furore over Mr Hain’s campaign would be the subject of one of his first inquiries.
Sir Christopher, quizzed by MPs on the Public Administration Select Committee yesterday, said, “The committee will certainly discuss that [Mr Hain’s case] and see whether or not there are lessons to be learned from the experience. And I would guess – although I’m speaking for a committee that I haven’t yet met – that the committee would be concerned that even now not everyone appears to have understood the importance of being absolutely transparent about political donations.”
Mr Hain has already apologised for the errors, and said there were serious flaws in the way his campaign was organised.
An angry exchange has taken place between the two men who ran last year’s campaign over who was to blame. Former Hain aide Phil Taylor, who ran the bid until April, said all donations had been declared when he was in charge. But his replacement, Steve Morgan, said he had been appointed to “bring order to the chaos”.
Mr Hain said it became necessary to raise more cash after the contest finished in June last year because “unpaid invoices” emerged during the summer and autumn.
However, he learned on November 29 last year that these donations had not been declared within the required timescale, and “immediately” informed the Electoral Commission and released a public statement. A meeting with the Electoral Commission during which he provided details of the failures last night had been “very satisfactory”.
The Hain affair is an unwelcome distraction for Prime Minister Gordon Brown, whose early months in office were dogged by questions of party finance. Downing Street said yesterday Mr Brown retained full confidence in Mr Hain.
Plaid Cymru’s Parliamentary leader Elfyn Llwyd said last night, “It is clear that Mr Hain is in a serious position at the moment and whilst I accept that he cannot be expected to micro-manage everything his office does, an under-declaration of this magnitude is deeply concerning”.