A Norfolk Labour Party has been criticised after it emerged it claimed thousands of pounds of public money intended to help businesses stay afloat through the Covid crisis.
The Norwich branch of the party received a £10,000 grant from the city council - which it controlled - at the height of the coronavirus pandemic.
Although the organisation was entitled to apply for the money, critics have condemned the decision to do so and called for the cash to be repaid.
The city council is also facing questions over its role in paying out the cash.
This newspaper began investigating the party’s accounts following a tip-off from a former member - who asked to remain anonymous - who said the public should be made aware of the payment.
“This is public money and they should have realised the party should not have taken it. It's unacceptable. For me, it’s a moral issue,” he said.
Covid business rate grants were set up early in the pandemic by then-chancellor Rishi Sunak, to “offer a lifeline to businesses who are struggling to survive”.
The grants were handled by local authorities and Labour-led Norwich City Council would have been responsible for checking the local party's application and awarding it the money.
A copy of the Norwich Labour Party (NLP)'s statement of accounts lists a business grant of £10,000 in income for 2020.
The accounts also reveal that at the time the party had total assets worth £447,106, including investments of £416,020.
It meant that at the end of the year, the party was able to say it was not in any great financial difficulty.
The document adds: “Our income remained reasonably stable thanks to ongoing fundraising and donations from supporters.”
The total receipts the party took in 2020 – including the grant - were £50,459, down from £69,310 in 2019 - a year which included a general election.
There were due to be local elections in 2020, but these were postponed due to the pandemic.
Political parties use funding from a variety of sources to support campaigning activities, printing costs and running offices. The NLP has an office at St Marks Church Hall, Hall Road, in the city.
In 2020, the NLP spent £47,673. By far its biggest expense was £28,379, which went towards campaigning costs. A further £7,000 went on property, £3,614 on office costs and £3,110 on fundraising. The year previously it spent £89,893. None of the money was spent on staffing.
The revelation about its Covid grant comes at a time when the pandemic has been back in the spotlight, with the ongoing enquiry into how the government handled the crisis.
The former Norwich Labour member who raised the issue said: “I found it unacceptable. For me, if anything is a grey area it is a political party taking the grant when their revenue was not affected by Covid at all."
He also raised questions about the council's role, given it was run by the party.
"There should have been more scrutiny of it at the time. I don’t think it was appropriate for the city council to make the decision.
"They looked at every application. It wasn’t just clicking a button and it was a grey area at the time.”
Lucy Galvin, leader of the Green Group at City Hall, said: "While NLP did nothing illegal in taking £10,000 from the Covid small business grants fund, many people will feel that this was not a proper use of public funds.
"We should expect the highest standards of propriety from political leaders. Many people will feel that a political party taking advantage of grants intended to support businesses and community groups during the pandemic does not meet those standards.
"Norwich Labour Party should immediately repay the £10,000."
David Thomas, Conservative candidate for Norwich South at the next election, said: “I think it’s disgraceful that money intended to keep struggling businesses and charities afloat was taken to fund political campaigning. This is taxpayers’ hard-earned money and should be repaid.
“This was not a case of having no money in the account and staff to pay, but a case of taking taxpayers’ money when sitting on nearly half a million pounds of assets.”
Mike Stonard, the current leader of Norwich City Council - who was listed as NLP chair and deputy treasurer in the 2020 statement of accounts - has not responded to requests for comment.
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Nick Williams, the local party treasurer and a former leader at City Hall, and the regional Labour Party also declined to comment.
A spokeswoman for Norwich City Council said: “Following guidance from central government at the time, the city council’s revenues and benefits team proactively reached out to numerous qualifying businesses in Norwich to let them know about the scheme and availability of the £10,000 funding.
"This was an absolute lifeline to so many businesses in the city at the time.
“The Labour Club in Hall Road was an eligible business. They were one of 2,073 small businesses in Norwich that received the grant.
“The grant money awarded to all these businesses does not have to be paid back. To suggest there was anything improper about qualifying businesses receiving one-off government grants is wholly inaccurate.”
HAVE OTHER PARTIES DONE THE SAME?
The grants were available for businesses, charities and other organisations with a “rateable value” of up to £15,000.
Larger grants were available for more substantial businesses.
Norwich Labour Party was not the only political group to take advantage of the grant during the pandemic.
A previous Huffington Post investigation revealed 22 others around the country had done so, including 15 Conservative associations and seven Labour parties.
At the time of the investigation, two Tory and one Labour branch had repaid the money.
The investigation did not name the NLP.
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