The cash for honours inquiry, 2006 to 2007

Date

March 2006 to July 2007

Relevant topic(s)

Democracy and participationDirect and representative democracyDemocracy and participationPressure groups

What happened?

In 2006 the police began investigating claims that people had been nominated for peerages after lending money to political parties. Labour had borrowed millions in undeclared loans before the 2005 election, and nominees for peerages had made such loans.

The inquiry lasted 16 months and led to the first questioning of a serving prime minister in a criminal inquiry, but no one was charged.

The police investigation began in March 2006 after a complaint from an SNP MP. All four nominees whose identities became public had made undeclared loans to Labour in 2005.
Labour borrowed £11,950,000 in undeclared loans from wealthy individuals between April and October 2005.
Lord Levy, Tony Blair's chief fundraiser, was arrested in July 2006 and again in January 2007. Blair was questioned by police on 14 December 2006 and again in January 2007, as a witness.
On 20 July 2007 the Crown Prosecution Service said there was 'insufficient evidence to provide a realistic prospect of conviction against any individual'. The offences considered included the Honours (Prevention of Abuses) Act 1925.

Why is it politically significant?

The affair raised questions about party funding and the appointment of peers, and fed the view that wealthy donors can buy influence. It links the participation crisis with debates about Lords reform and party finance.

How to use

Which arguments does it support?

Wealthy donors may buy influence

Reasoning: Nominees for peerages had lent large sums to the governing party.
Evidence: All four publicly identified nominees had made undeclared loans to Labour.
How it supports the argument: Labour borrowed £11.95 million in such loans in 2005.

Which counterarguments exist?

Limits of the evidence

No one was charged

The CPS found insufficient evidence for any prosecution, so the claims were never proved in court.

Other explanations

The vetting system raised the alarm

The House of Lords Appointments Commission had queried some of the nominees before the police inquiry began.

Concepts and connections

Concepts it illustrates

Legitimacy Democratic deficit

Related examples

Cash for questions, 1994 to 1997

Sources and verification

EventMarch 2006 to July 2007

Added to bank11 November 2026

Last checked11 November 2026

Next check due11 May 2027

3
No charges in UK funding probe
Publisher Al JazeeraPublished 20 July 2007Type NewsChecked 4 November 2026
Opened
2
5 minute guide: cash for honours
Publisher Channel 4 NewsPublished 2007Type NewsChecked 4 November 2026
Opened
1
Public Administration Select Committee, Second Report of Session 2007–08
Publisher House of CommonsPublished 11 December 2007Type OfficialChecked 4 November 2026
Opened

About this example

Is it still current?

Concluded

The development has ended or been reversed, but remains useful evidence.

Why it is in the bank

Shows concerns about money in politics and the appointment of peers.

✓Relevance to the specification
✓Strength and reliability of the evidence
✓Importance to a wider political debate
✓Usefulness in evaluative essays
✓Connections to other topics
✓Sufficiently current
✓Adds something new to the bank

Editorial status

Approved

Signed off for students.

Origin: AI draft (Claude) · Reviewer: Editor

Every fact on this page has been checked against original sources.