FF hit by €1.5m debt as donations laws kick in

FIANNA FÁIL has run up debts of €1.5 million following three costly electoral campaigns last year that severely hit the party’s finances.

An informed party source confirmed to the Irish Examiner that the combination of last year’s General Election and the abortion and Nice referenda had left the party facing debts approaching €1.5m.

One of the reasons behind the dramatic downturn in the party’s financial situation has been the impact of legislation introduced last year that capped corporate donations to the party at €6,350. Previously the party had been able to rely on large donations from business interests to a much greater extent than its political rivals.

Faced with a situation where it had to seek small donations from a far greater pool of donors, Fianna Fáil electoral finances sustained a significant hit. The financial position of the party is unlikely to improve in the medium term as it faces into a number of costly election campaigns during 2004. In addition to next summer’s local and European elections the party may also face a prospective Presidential election before November if the Presidency is contested.

The disclosure comes after Environment Minister Martin Cullen signalled he intends to amend the Electoral Act to allow a substantial increase in corporate donations to political parties. The Minister’s motives for initiating this change have been questioned by opposition parties. Fine Gael’s environment spokesman Bernard Allen said any plans to abolish the limits would be fought while his Labour Party counterpart Eamon Gilmore accused Mr Cullen of trying to build up a “war chest” for future campaigns. It is widely accepted within political circles that Fianna Fáil would be the major beneficiary of any easing of the cap.

Under the legislation introduced by Mr Cullen’s predecessor at Environment, Noel Dempsey, political parties are allowed to accept donations from one source of up to €6,348 in any given year. The limit for an individual politician is €2,539 per donor.

In an interview at the weekend, the Minister said he was not convinced of the merit of imposing limits on corporate donations. He went on to say he believed the public should not be laden with the costs of funding the political system and corporate bodies should be encouraged to do so.

The party no longer possesses major assets in the wake of selling its Mount Street headquarters. Overheads have also increased over the past five years as the organisation has expanded. A Fianna Fáil spokesman said yesterday the party did not discuss its financial situation.

Willie O’Dea yesterday became the first FF minister to publicly express doubts about any major change in the current limits. The junior Minister for Justice said he would not oppose an increase in line with inflation or the consumer price index but said he would be “uncomfortable” with parties being overly reliant on large corporate entities.

There has been some speculation Fine Gael may also be in debt, particularly in light of the party’s self-imposed ban on corporate donations under Michael Noonan’s leadership (a policy revoked by current leader Enda Kenny). However, a spokesman said the party was “absolutely solvent”.

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