Unsettling Accounts
By E. N. Ronn
A noteworthy feature of the radical right in Great Britain (indeed the English speaking world) has been the under representation of the professional classes in its ranks.
Why it is that doctors, lawyers and academics are willing to join the ranks of French, Italian and Spanish patriots, but not (generally speaking) our own, is a debate for another day.
The consequences of this unhappy situation are almost uniformly damaging, both in ways that are blindingly obvious (for example, the difficulty in finding competent and sympathetic professionals to assist with legal, accounting and regulatory matters) and in ways that are less immediately apparent.
One of those consequences is that it is all too easy for a glib and unscrupulous leader to deceive his idealistic but badly informed followers, who are singularly ill equipped to get at the truth, or even to see it when (to those with a better knowledge of business than is to be found in the ranks of what remains an overwhelmingly working-class movement) it is already in the public domain.
This problem, which would exist anyway, given the movement’s socio-economic base, is greatly aggravated by a culture of secrecy that is an unhappy legacy from the days of the late John Tyndall. He was understandably concerned to play down the weakness of the BNP in the 1980s (it had, one very senior former official has told me, only 350 paid up members at the time when Derek Beackon won his Millwall seat: even allowing for the fact that at that time a good many of the party’s activists were not paid up members, it is doubtful whether the numbers involved in 1993 were much over 700 to 800), and did not therefore publish accounts, keeping the true figures to himself and the Inland Revenue.
One of the results of this “need to know” approach was the creation of a climate of opinion in which the withholding of basic information about the BNP from the members was widely accepted, though it is not as a reasonable practice. A party belongs to its members, not its chairman.
As it happened, the end of JT’s long tenure as chairman of the BNP coincided with the coming into force of the less than snappily named Political Parties, Elections and Referendums Act 2000 (“PPERA”). PPERA made it compulsory for political parties to file their accounts with a new regulator, the Electoral Commission. It also imposed a requirement for audit by external accountants on parties whose turnover exceeded a statutory threshold.
Worthy of more than passing comment is the curiosity (see p. 15 of the BNP Statement of Accounts for the year ended 31st December 2005) that statutory audit under PPERA works very differently from any other audit, for the auditor is not answerable to the members of the party in general meeting (as might be expected) but to the treasurer. This is a strange inversion of the usual purpose of audit, which is an external check for the members’ benefit on the probity and competence of an organisation’s officers.
In any normal political party, it might therefore be expected that the members would appoint an auditor of their own, especially when turnover stands at £672,246, which is no trivial sum. In Nick Griffin’s BNP that does not happen, and any suggestion that it should would be as well received as the proverbial bacon butty at a bar-mitzvah.
Even so, the BNP’s statutory accounts, available on line on the Electoral Commission’s web site, reveal much of interest to the discerning eye.
The accounts begin with a long introduction by Nick Griffin, who candidly admits (p. 2) that an unfortunate result of the party’s impressive effort in the 2005 general election: “ . . . was that the party centre seriously overstretched itself financially, with our potential for growth in the second part of the year seriously hampered by the resulting fiscal austerity”.
Just how seriously the party is overstretched (and why) will be seen by those who read on. With extraordinary chutzpah (learnt perhaps from his unlikely new neo-con friends) Griffin claims (p. 3) that the BNP has gone “to extraordinary lengths to comply with every single requirement to ensure financial transparency. . .” This statement is demonstrably untrue, and contradicted by later pages in the same report.
Interestingly for anyone inclined to believe sweet talk about reform from the Griffin clique, Griffin continue at p. 6 with a bold reassertion of the Leadership Principle (or Führerprinzip, in the original German). The party leader, he says: “has sole control of and responsibility for, the administration, finances, strategy, policy development and tactical decisions. As the party grows, more and more of this responsibility is delegated, but the underlying Leadership Principle is unaffected by such day-to-day arrangements.”
Other officers have to drink the poisoned chalice of responsibility without power, for (in Griffin’s own words):
“The party also has a fund-raising body, the Trafalgar Club, which is administered by [the Administration] Dept. Under the party constitution the National Treasurer is not permitted to handle this body’s finances, although it is of course subject to overview by him and subject to the (sic) full external audit.”The National Treasurer is thus in the unhappy position of having statutory responsibility for the Trafalgar Club’s accounts under s. 43 of PPERA, including their consolidation with the party’s other accounts, but no control over them. Rather him than me!
While, moreover “the party is structured into political regions” they are (p. 7) all “under the remit of the Regional Accounting Unit for their financial administration.” The significance of that point is that monies raised locally for local campaigning can be taken by the centre at will in order to fund a deficit for which the national leadership is responsible.
A bizarre feature of the BNP accounts is the very different figures for membership that appear at pp. 10 and 13. At p. 10, we are told that paid up membership was down on 2004 from 7,916 to 6,008, whereas at p. 13 the figures are 6,502 for 2005 and 6,356 for 2004. Plainly both sets of figures cannot be correct.
That is not the only interesting information to be derived from p. 10, no, not by a long way. Under the sub-heading “staff” we learn that in the year ended 31st December 2005: “ . . . the party had nine full-time members of staff, plus a number pf part-time central administration workers. It also utilises the services of a number of self-employed experts who are paid for specific work carried out from time to time as required.”
As with the membership figures, Nick can’t add up (given this failing, it is perhaps unsurprising that, as he boasted to the Mail on Sunday on 9th April 2006, he was the biggest bankrupt in the history of the Leeds & Holbeck Building Society!), for at p. 12, he lists only seven permanent members of staff, though by note 5 at p. 24 we are back to nine.
The wages bill for this establishment is demonstrably the principal cause of the party’s financial woes, but this is not the only extravagance noted in the accounts, for at p. 11 we learn that the cost of Mark Collett’s toy printing set was £70,000 (more than a tenth of the party’s total income). One of my well placed sources in Yorks. BNP tells me that this equipment was thrashed to death at the 2005 general election, and is now of little value, certainly much less than the depreciated figure of £51,671 given at note 6 to the accounts (p. 25). It follows that the party’s balance sheet is in fact even weaker than the recorded cumulative deficit of £52,512 (p. 22) suggests.
Page 13 is certainly unlucky for some, as the admissions in the closing paragraph are remarkable. This paragraph is a gem: “As the party were (sic) only able to find an auditor in the latter part of 2004, the question of setting up a system of internal control could not be addressed until the beginning of 2005, and whilst making progress there is still significant progress to be made. At the same time the banks began to withdraw normal banking services from the party, and therefore a considerable amount of expenditure was paid for by cash, which because of the nature of cash transactions was not subject to such strict control as cheque expenditure, and was not always recorded.”
Put into plain English, despite Griffin’s boasts that the party is attracting more middle class supporters, it is unable (Griffin having driven Mike Newland out) to find within its own ranks a competent accountant who can set up a system of internal controls, and needs to engage its external auditor to put such controls in place.
Worse still, an “Arthur Daley” cash payments system was employed despite a permanent staff of nine, who could or at any rate should have written up sales and purchase ledgers, for cash as well as cheques. The directors of any trading company with a turn over of £672,246 who made such damaging admissions would be in serious trouble with the Department of Trade and Industry, and very rightly so. The Leeds & Holbeck’s biggest bankrupt simply brazens it out.
Detailed analysis of the income and expenditure account is informative. Expenditure exceeds income by an alarming £94,711. No less alarming is where the money goes. Only £31,792 was spent on campaigning, whereas an admitted (but as I shall demonstrate, seriously understated) £247,592 went on staff costs, and £168,555 on management and administration.
In fact the wages bill was really £292,212, of which £44,260 is described (note 3 at p. 20) as a recharge of staff costs to commercial activities, so that on a superficial reading of the accounts, the full extent of the wages bill is not apparent.
The breakdown of staff costs at p. 20 makes for interesting if not very illuminating reading. The total of £171,306 for professional fees is extraordinary, especially as it does not include the audit fee of £5,306, which appears separately at note 7 on p. 21. The inference must be that “professional fees” amount to disguised wages paid to persons describing themselves as independent contractors to (rather than employees of) the party, so as to save on employers’ national insurance contributions (NICs). Quite why £9,836 was spent on insurance is unclear, whilst the payment of £11,338 for taxes is difficult to understand. Perhaps it relates to payment of NICs, but we are not told. It is certainly a lot of money.
The management and administration charges at p. 20 will also make disturbing reading for the rank and file members of the BNP, who make large sacrifices to donate to the party. Motor expenses of £13,359, telephone bills of £30,741 and travel and entertainment costs of £63,216 reek of a leadership living high off the hog on the widow’s mite. The drunken party thrown by Napoleon, the pigs’ corrupt and tyrannical leader, at the end of Animal Farm comes to mind. I wonder why? Who incidentally received the rent of £12,998 recorded in note 5 at p. 20?
In any normal party, these questions would be raised with the treasurer and auditors, to be answered in the presence of the members in general meeting, before the accounts were received and approved. Since the BNP does not hold an AGM, there is no opportunity for any member so to do, even though the leadership is spending their money (and some more on top, hence the carried forward deficit).
After the party, the hangover. It is scarcely surprising that the auditors, Silvers (who will surely approve of the party’s rapprochement with Zionism) express their concern at the position: “Whilst the accounts have been prepared on the basis that the party is a going concern, given the fact that for the last two years the party has incurred a deficit, and that the Balance Sheet is now in deficit, there is an element of doubt as to its ability to continue as a going concern. There are however funds available within the ‘Regional Accounting Unit’ and the possibility of donations to rectify the situation.”
Recorded donations for the first quarter of 2006 were £1,028, and for the second, £5,500. Donations in these sums are not going to solve the BNP’s problems. Without raiding branch and regional funds within the ‘Regional Accounting Unit’ to pay for the wages and entertainment bills, or large scale redundancies, the BNP is bust.
Unsettling Accounts
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