SINCE WHEN ISN'T LOANING THE SOVEREIGN MONEY WORTH A TITLE?:

Secret loans: Blair warned but gave the go ahead (BRIAN BRADY, 3/19/06, Scotland on Sunday)

[I]n an extraordinary off the record interview with Scotland on Sunday, one of his closest allies revealed that:

• The Prime Minister and a select band of confidants involved had to "convince each other" that taking loans from party supporters was the right thing to do;

• Blair opted for the loans strategy because the party was "skint" and faced meltdown during the General Election campaign last year;

• The clinching argument was the belief that rival parties were using the system to swell their coffers.

This weekend, Blair and the Labour high command have also "gagged" Labour's treasurer to prevent him from exposing the identities of the party's multi-millionaire lenders, because they are protected by commercial "confidentiality clauses".

The Prime Minister entered into the deal with the group of lenders to ensure that their contributions could not be exposed at a later date.

However, it emerged last week that three Labour lenders - Sir David Garrard, Chai Patel and Barry Townsley - were on the list of nominations for elevation to the Lords signed by Party chairman Ian McCartney in October.