THE IRON LAW OF UNINTENDED CONSEQUENCES:

We want our money back (Christopher Hope, Jeff Randall and George Jones, 22/03/2006, Daily Telegraph)

Labour was plunged into a full-blown financial crisis last night after millionaire businessmen embarrassed by the disclosure that they had made "secret" loans insisted on the party paying back at least £6.5 million.

The threat of Labour being bankrupted by the loans scandal came as Scotland Yard announced that it had opened an investigation into the alleged sale of peerages.

At least five of the 12 businessmen who lent almost £14 million to Labour last year expect to be repaid, a survey by The Daily Telegraph has found.

The five - including Chai Patel, Rod Aldridge, Sir Christopher Evans and Barry Townsley - advanced £6.5 million in total. All said they wanted the money back. About £3.5 million is due this year, with the remainder expected in 2008.

Typically, the businessmen have charged 6.5 per cent interest, which means the figure eventually repaid by Labour will be much higher. City experts believe the party could be running up interest charges of £1 million a year.

Exposing the loans was supposed to be an easy way for the Left to take out Tony Blair, but they're imploding the whole party in their zeal to get him.

Posted by Orrin Judd at March 21, 2006 10:16 PM