By Russell Bruce
This article contains information on SNP finances, all of which are in the public domain. The article is fully referenced. Given the police investigation we have avoided drawing conclusions on what are quotes or simply notes on some of the information taken from the accounts. We only know what was published in the SNP 2021 accounts, openly available from the Electoral Commission.
It is not surprising that there is much coverage of the police investigation into SNP accounts but the scale of the police presence at the home of Peter Murrell and Nicola Sturgeon did seem excessive given comparisons with the low key police presence during investigations at the homes of Michelle Mone and her husband Douglas Barrowman into the £203 million PPE contract awarded to PPE Medpro. Michelle Moan, oops Mone, is alleged to have canvassed for the contract to be awarded to PPE Medpro. The UK government is seeking to obtain the return of the £203 million award for PPE reportedly not fit for purpose and never used.
The sheer size of the police presence at the Murrells home was extraordinary and even the Daily Mail, such staunch supporters of the SNP, were highly critical and ‘appalled at McPlod’s raid’.
Then there is the apparent mystery of why the SNP no longer has a firm of accountants to carry out the 2022 audit. We now know they resigned 6 months ago but Humza Yousaf only learnt about it after he became First Minister. He, and it seems everybody else, had no idea about the Niesmann + Bischoff up-market campervan or to give it its posh name, motorhome.
It seems the campervan was bought because in January 2021 Covid lockdown was reintroduced that month. The plan supposedly was Nicola Sturgeon would be able campaign around Scotland at the Holyrood election without using hotels and making maximum use of social distancing on visits across Scotland. In any event lockdown was lifted and the fancy motorhome was never used. As it was locked and clamped, presumably for security, and parked at Murrell’s mother’s home in Dunfermline, it has not moved an inch in over 2 years, as broken in an exclusive by the Daily Mail. Somebody might have made a nice little earner for selling the story to the Daily Mail.
The police impounded the vehicle the same day they arrested Peter Murrell who was later released without charge. The Daily Mail exclusive was not published until Friday 8th April but has since been widely covered by the media in this country and abroad.
Some have asked why the campervan was not sold later in 2021. It should be remembered that during the latter Johnson PM years and the brief PM visit of Truss that the UK government was rather unstable and a general election may have come at any time.
Had the motorhome been used in the 2021 Holyrood campaign the cost would have had to be included in the party’s campaign expenses to meet Electoral Commission rules. The FT reports that it is the Electoral Commission’s understanding that the vehicle was never used for political campaigning and as such lies outwith the commission’s remit. In retrospect, if not also for other reasons the purchase of the motorhome and presence on the SNP’s books might not have been the wisest of decisions.
SNP accounts for the year January to December 2022
All we know is that no replacement auditor has yet been sourced. Some have suggested that a forensic examination should be carried out by independent accountants to meet the party’s obligation to file these with the Electoral Commission. To carry this out means a detailed examination of all revenues, plus paperwork to justify all expenditure; receipts, invoices and expenses claims etc and place these under the correct headings for a fully detailed and transparent set of accounts also showing monies due and with detail on the party’s end of year reserves. As the police have gone off with records and as we understand it computers there may be a question as to whether the necessary financial information is available for audit.
The NEC and the party treasurer is responsible for ensuring that proper accounts reflecting the SNP financial position are delivered to the Electoral Commission as required by the Commission by the deadline in early July. Since the Treasurer Colin Beattie has also now been arrested and released without charge and has stood down as treasurer somebody else will have to be made interim treasurer- see below. Then there is the question of the police having gone off with all the material required for the audit.
The SNP NEC it is reported as having 42 members. Whatever their experience this is bound to include a significant number of financial innocents. The suggestion from Kenny Anderson in this tweet of an NEC group of 12 with a financial skill set makes perfect sense. Mandatory training should also be required. As an example the Institute of Directors provides this to a range of organisations.
The other information that has also come to light is that the party’s former auditors, Johnston Carmichael, also audited the SNP Westminster group’s accounts. This is even more urgent to resolve or the group could lose the Short Money provided to opposition parties to enable them to carry out their role in keeping the government to account. The SNP received £1,177,842.87 for 2022/23. The Scottish police have no reason for wanting these records as none of the so called independence fund they are thought to be looking into could have found its way to the funds of the SNP Westminster group.
Exactly what the police are looking for is only known to them but we know the party is facing ‘fraud allegations’ in a police probe into £600,000 of so called ‘missing’ party donations, cash “earmarked” for a second independence referendum’. The probe was triggered after complaints from Alba and Salmond supporters and independence activist Sean Clerkin, not generally considered to be an expert in such matters. The SNP argue that all elections contested promote independence and are a path to making that more achievable, especially true of campaigns to remain the government of devolved Scotland. Holding sole purpose funds for a future event at an unknown date is not necessarily sound financial management at times when cash flow and cost of borrowing are immediate cost issues, especially for a year that included the campaign costs for the Holyrood election.
The accounts includes 2 paragraphs relating to the Referendum Appeal. (page12)
This states (Page 12) that “By December 2021 a total of £740,822 had been raised through the independence related appeals. These donations are also included in – and have been reconciled with the total amount for donations included in Party accounts from 2017 to 2021. Up until 31 December 2021 a total of £253,335 of expenditure had been applied against this income. The balance remains “earmarked” for independence related campaigning.
“Of course, the SNP is the party of independence and, as such every action we take – directly or indirectly – is in support of winning independence. However, we continue to take a very strict approach to ensuring that this income supports expenditure directly related to the campaign for independence. We will ensure that an amount equivalent to the sums raised from these appeals will go directly to our work to secure a referendum and win independence”
Given the police investigation we have no comment to make regarding the above
Nothing from the following notes from the 2021 SNP accounts has any bearing on the police investigation or is intended to influence whatever they are doing. What is reported below is basic information from the 2021 accounts that are all in the public domain. It may be helpful to members and independence supporters who might not be sure of navigating the 36 pages of the full 2021 accounts.
The accounts note (Page 10) ‘as at 31May 2022, the annual salary of our Chief Executive is £79,750.‘ It has been widely reported that Peter Murrell gave a £107,620 loan to help with cash flow on June 20, 2021, according to the Electoral Commission. Two repayments – of £26,905 and £20,715 respectively – were made by the SNP in August and October of that year. That means there was exactly £60,000 left outstanding at the end of the financial year, as reported by The National last December. The £60,000 outstanding to Murrell at the end of the 2021 financial year is as detailed on page 34 of the accounts under Notes 22 Loans. The original amount should have been declared to the Electoral Commission in July 2021. Humza has now clearly been briefed on the 2021 accounts as he announced this week Murrell was still owed £60,000 as at December 2021 – information that has been in the public domain for 4 months.
It has now been acknowledged by Humza Yousaf that the SNP do indeed own this campervan. An amount of £80,632 is included as part of Tangible assets (Page 20). Note 18 on page 33 indicates that no depreciation was included for the campervan. The difference between the reported cost of round £105,000 and the £80,632 value in the books is probably because VAT charged on most vehicles is not reclaimable. This means it can be sold without VAT being added, when the police hand it back. There are different rules for working vehicles like taxis and delivery vans but VAT must be charged every time they are sold in future.
Cost of 2021 Holyrood election
The SNP spent £1,647,041 on securing a historic fourth term in 2021. This was the largest expenditure item in the 2021 accounts. There is an interesting comparison of relative spend efficiency compared to other parties on page 12.
SNP:£0.61per vote /£22,943 per MSP Conservative:£1.11 per vote /£43,853 per MSP Labour:£1.10 per vote /£53,473 per MSP Liberal Democrats:£1.33 per vote /£108,588 per MSP Scottish Greens:£0.91per vote /£28,988 per MSP
The cost of the spend per vote was sourced from the House of Commons Library. The fourth term is when the wheels are in danger of coming off and in 2021 they didn’t. The party has 3 years to get the wheel nuts secured before the next Holyrood election but less time when it comes to the General Election when seats are currently at risk according to present opinion polls. The Savanta poll gave Labour a 9% lead in the sizable sub sample for Glasgow.
Readers probably don’t know the SNP has reserves. Largely because of maximum expenditure on the Holyrood election these reserves were depleted during 2021. Income totaled £4,510,460 with the largest share £2,316,854 from membership subs. Next were donations at £695,351. Expenditure at £5,259,805 meant the end of 2021 saw a net deficit of £751,572 compared to a surplus of £1,090,421 in 2020 which was a year of low expenditure probably because 2021 would be a year of high expenditure. At the start of the 2021 reserves stood at £1,362,337. The deficit meant that the ‘Accumulated fund at the end of the year’ amounted to £610,765 at 31st December 2021. (Pages 19, 20 and page 35 (Note 23 Reserves).
SNP Branch funds at HQ
In the old days branches bought SNP membership cards from HQ. The price covered costs towards running SNP HQ. Today HQ collects membership subscriptions but 25% of what is collected is due to the branches. This is held in Branch Dividend accounts at HQ. Branches have their own bank accounts for local fundraising and paying the costs of running the branch. Both accounts are reported in the branch annual accounts and in the regular treasurer’s report to branch meetings.
The totality of these branch funds at HQ are accounted for as a liability (creditors) in the SNP accounts. Branch Dividend amounts due was £760,628 at 31 Dec 2021. This is item (b) in Note 25 Related party transactions. The other items are smaller related loans of £11,335 and the Loans from executive management (Murrell) of £60,000. Seen in this context these loans/branch credits can be viewed as part of a wider strategy to protect cash flow and reduce the need for or cost of bank borrowing. See also Note21 Creditors. In December 2020 branches held £783,021 at HQ compared to £760,628 at 31 December 2021.
An organisation with a similar membership size
Our team includes someone who worked for an international charity for 10 years. The charity had associate organisations around the world. Two in Europe including the UK, the US, one in South America plus Australia. The financial exchanges were therefore more complex than for the SNP due to international financial movements. Their annual audits were normally completed within 2 months.
The need for greater transparency is acknowledged but not a lot seems to be happening. Until the end of the police investigations and finding out if there are charges or not there remain issues about making full progress. We could at least get monthly membership figures. Information on the appointment of auditors both for the Party and the SNP Westminster group would be welcome news. The news today that the NEC have appointed Stuart McDonald MP as interim treasurer is welcome as is the speed with which the NEC have acted.
High levels of reputational advantage tend to endure though a period of decline but once lost rebuilding can be a slow difficult process. Is the party aware of this well researched trend in reputational change?
The SNP has problems with a resurgent Labour party, committed as it is to Brexit and an increasingly anti-devolution Tory party committed to suppressing democratic rights, making voting more difficult and for whom SNP problems are a convenient distraction from their issues of unstable government, losing ministers on an almost monthly basis. Taking lessons from any of the Westminster parties is no answer for Scotland and it is time to be open with the electorate that there are no solutions in following a Starmer or Sunak prescription and that the path is for Scotland to find it own way through the current difficulties because we are Europeans set on achieving the wealth and wellbeing of our Northern European neighbours.
This article was further edited shortly after first published