The Labour Party leader, Mr Pat Rabbitte, has called for strict limits on private donations to political parties in a move signalling acceptance that the business funding of politics is here to stay.
Coming after Fine Gael reversed its policy of refusing corporate donations, Mr Rabbitte's statement means that the united Opposition campaign for an outright ban has dissipated. Mr Rabbitte said yesterday that while he remained personally in favour of banning corporate donations, "the problem is the Government isn't".
Mr Rabbitte yesterday suggested that there should be a cap of €500 on donations to individual candidates and €1000 to political parties, and that the source of such donations should be made public. This represents a major change from his predecessor, Mr Ruairí Quinn, who said before the May general election that an absolute ban on corporate donations was a party pre-condition for entering Government.
A senior party source said yesterday that the Fine Gael decision meant there was now no chance of a united Opposition stance against business funding of politics. In that context, he said, Labour could not disadvantage itself by refusing donations from trade unions and small local businesses.
Mr Rabbitte said it appeared corporate funding would continue and Fianna Fáil and Fine Gael would therefore have a "competitive advantage" should Labour refuse to accept such funding.
"Therefore the sensible position is to decrease the limits and require everything to be declared."
He also said that his legal advice was that no distinction could be made between donations from corporate bodies and individuals. While there has been no formal decision made to change their position, several senior party figures said yesterday they were aware of Mr Rabbitte's thinking on the issue, and that the position he outlined was unlikely to cause major divisions within Labour.
The Minister for the Environment, Mr Cullen, signalled in October that he was planning to amend the legislation that limits party election spending and the size of donations. He is understood to be considering increasing the size of donations and election spending allowed, while retaining the requirement that the source of such donations be made public.
Mr Rabbitte said yesterday he would strongly oppose this. "The legislation was disgracefully abused" during this year's general election campaign, he told RTÉ's Today with Pat Kenny programme. In his own constituency "huge spending by Fianna Fáil and Sinn Féin occurred before the election was called" and therefore was not counted towards the overall election spending of these parties.
"I would prefer to see the funding of politics by the State, but if we do have a donations system it ought to be capped and transparent."