City Building LLP, which has been the subject of a number of allegations in the wake of Mr Purcell’s controversial departure from the council earlier this month, will no longer host a stall at the gathering in Glasgow.
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It is understood the firm had paid up to £9,000 of public money for the stall, but it is unclear if the money will be returned.
The move comes after a ruling by Glasgow council chiefs to block its arm’s-length companies -- or ALEOs -- including City Building, Cordia and Culture and Sport Glasgow, from making what amounts to donations to political parties.
The authority’s chief executive, George Black, who made the ruling on Friday, said he had not previously realised taking space at party conferences amounted to a political contribution.
City Building had a stall at last weekend’s SNP conference in Aviemore, which was staffed on Saturday. However, when it became public on Sunday that Mr Black had called time on ALEOs spending money at political events, the firm packed up and left.
City Building is understood to have booked and paid for space at the Labour conference several months ago. Prime Minister Gordon Brown is expected to use the last set-piece event before a widely anticipated May 6 General Election to rally his party.
A City Building spokesman said: “Given the Glasgow City Council advice that ALEOs should no longer attend party political events we have decided not to attend this week’s Labour Party conference.”
The ban followed revelations that City Building had donated £2,000 to Labour at a dinner and spent more than £50,000 taking exhibition space at Labour Party conferences.
Mr Black said the company had “not understood the connection between taking a table at this political party event and making a donation”.
He added: “City Building has agreed in hindsight it ought to have realised the nature of the event.”
Last night, SNP sources raised eyebrows at the £9,000 figure, claiming City Building was only charged £1,800 for its two-day Aviemore presence.
The source said: “While we understand the figures aren’t confirmed there’s a massive gulf between this and what we received.”
The Sunday Herald revealed at the weekend that another quango run by one of Mr Purcell’s former advisers, Ian Manson, paid Labour Party donor Willie Haughey almost £700,000 in a land deal.
Clyde Gateway Developments paid the cash to the businessman last year for his interest in a site at Camp Road, Rutherglen. Mr Haughey repeated last night that he would report himself to Audit Scotland for investigation to clear his name.