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Blair sold house of lords seats for secret loans { March 21 2006 }

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   http://seattlepi.nwsource.com/national/1103AP_Britain_Loan_Scandal.html

http://seattlepi.nwsource.com/national/1103AP_Britain_Loan_Scandal.html

Tuesday, March 21, 2006 · Last updated 12:18 p.m. PT

Blair caught up in seats-for-sale probe

By BETH GARDINER
ASSOCIATED PRESS WRITER


LONDON -- Police opened an investigation Tuesday into allegations that Prime Minister Tony Blair sold seats in the House of Lords in exchange for secret loans to his governing Labour Party, another twist in a political furor that has prompted calls for Blair to leave his job.

Public trust in Blair has taken a pummeling in the week-and-a-half since the loans became public, adding new weight to long-standing charges that those who support Labour financially are frequently nominated for peerages in the Lords or titles like knight, dame and Commander of the Order of the British Empire.

Blair says he has not made such nominations in exchange for party funding and that all his Lords nominees are well-qualified for seats in Parliament's upper chamber.

However, the party has acknowledged it accepted and did not disclose loans of almost $25 million from 12 supporters. Four of the 12 were nominated for a seat in the House of Lords, although three later withdrew their names.

Keeping the money secret was not illegal. The law requires that only gifts, not loans, to political parties be made public.

Nonetheless, the political damage to Blair - who won office in 1997 promising clean government after a string of Conservative scandals - has been substantial.

Even senior party figures like the Labour treasurer and the deputy prime minister have said they were unaware of the loans until they were revealed in a newspaper report.

And a poll released over the weekend showed that nearly half of Britons believed the "cash for honors" charges were true, and more than 70 percent believed Blair's government was at least as sleazy as that of his predecessor, John Major.

That is a worrying statistic for Blair, who trounced Major in 1997 after pinning the term "sleaze" on his government.

London's Metropolitan Police said Tuesday they had received three complaints alleging Labour may have violated a 1925 law on abuses in honor nominations, passed after Prime Minister David Lloyd George sold titles for personal gain.

Police said lawmaker Angus MacNeil, a member of the minority Scottish National Party, had made one of the complaints, but they would not reveal who filed the others. Neither Blair nor any other Labour official was named in the complaints, police said.

The prime minister has tried to contain the political damage by releasing the lenders' names and calling on the opposition Conservatives to name people who have given them loans, a suggestion they have refused. Leaders of all the main political parties are allowed to make nominations to the House of Lords. The nominations are then screened by an independent commission.

The government also says it will seek to close the legal loophole that lets parties keep loans secret.

That has not been enough to quiet the calls for Blair to leave office soon, which have been growing louder and more numerous since the story broke.

The left-leaning Guardian newspaper, in an editorial Monday, said that after nine years in office "he should go this year," the first time it has called for his resignation.

"Adrift in Iraq, ... caught in a net of soft loans which looks worse by the hour, ... Mr. Blair risks becoming a leader without purpose beyond power," the newspaper said. "The longer he waits, the greater his troubles will be and the greater the damage to his party, the country and his reputation."

The influential Economist magazine ran a picture of a waving Blair on its cover last week beside the words: "The final days of Tony Blair."

"If Britain's prime minister is not thinking about stepping down, he should be," the magazine said.

Under Britain's parliamentary system, voters elect a political party, not a prime minister. So Blair could resign at any time, and whoever the Labour Party chooses as its new leader would succeed him as prime minister.

Treasury chief Gordon Brown, the government's powerful No. 2, would be widely expected to get the job.

Blair, who was re-elected to a third term last year with a drastically reduced majority, has said he will not run again but intends to serve his full third term.

Under the British system, leaders generally go into elections having already headed their party for several years, so most believe Blair will quit by 2008 at the latest to give Brown a year to serve as prime minister before facing the voters. The next election is expected in 2009.

John Rentoul, a Blair biographer, said that despite the latest allegations, the summer of 2007 is the most likely time for the prime minister to step aside.

The "cash for honors" fracas makes it less likely Blair will leave office soon, Rentoul argued.

"He's stubborn," the biographer said. "He wants to go when things are looking good for him, not bad."




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