RUTH Davidson has suffered another blow to her leadership of the Scottish Tories after it emerged that one of the Conservatives' biggest donors north of the Border is facing questions about his company finances.
Malcolm Scott, who as Scottish Tory treasurer has to balance the party books, is under pressure to explain why several of his own companies are overdue filing their accounts. After donating around £1.6 million over the years, Scott’s financial support for the Conservatives has also dried up.
Davidson was elected leader earlier this month as her party faces mounting financial challenges. The decision by the Scottish Tories’ one-time paymaster, Lord Laidlaw, to stop his donations led to the party laying off staff and moving to smaller offices.
The developments resulted in the party relying even more heavily on cash transfers from London and the big-ticket dinners organised by veteran supporter, Sir Jack Harvie.
Scott, a property and grain millionaire based in Edinburgh, has been another reliable source of support.The party treasurer has made a raft of personal and corporate donations to the UK Conservatives and helped fund campaigns in Scotland.
The businessman is also heavily involved in two other bodies, Fresh Start and Scottish Leaders, which either raise money or stage dinners for the Tories.
The Sunday Times Rich List previously estimated he was worth around £100m, a figure Scott has described as “optimistic”.
The Sunday Herald can now reveal that parts of Scott’s business empire are experiencing problems complying with their legal obligations to file accounts. Five of of the “large” companies he either owns or controls are over four months late in filing accounts.
The holding company for Scott’s firms, Dunalastair Philip Wilson Ltd, flagged up a “material uncertainty” in its 2009 accounts which potentially “cast doubt on the group’s ability to continue as a going concern”.
The issues cited for the “material uncertainty” included the continued financial support of the group’s bankers, and factors surrounding the global credit markets.
The same accounts added: “At 31st March 2008, a tax liability of £400,000 existed in the [retirement and death benefit] scheme as a result of a breach of HM Revenue & Customs permissible borrowing limits.” Dunalastair, which is still trading, is listed as the “principal employer” of the scheme.
Despite the cautionary sections in the accounts, the document did state: “The directors have a reasonable expectation that the group and the company have adequate resources to continue in operational existence for the forseeable future.”
Another four of Scott’s firms – Swarland (Grain Driers) Ltd, Prestonpans (Trading) Ltd, Dunalastair (Ireland) Ltd, and Philip Wilson (Grain) Ltd – were also supposed to have filed accounts by the end of June. According to Companies House, penalties are imposed on firms that miss the deadline for filing accounts, while it is a criminal offence not to submit accounts.
Scott’s current lack of donations to the Tories also suggest the businessman is tightening his belt.
Of the near-£1.6m he and his companies have given to the party, the bulk was handed over between 2007 and last year. Scott’s only recorded donation in 2011, despite it being a Holyrood election year, was for a private plane to fly William Hague to Edinburgh, worth £4200.
Two of the firms overdue on their accounts have made donations in the past. But there may be better news for Scott. It was reported last month that he could make £15m if he sells his luxury hotel in the French ski resort of Courchevel. Meanwhile, the Scottish Tories are under fire over Davidson’s handling of her front-bench appointments this week at Holyrood. Davidson won the leadership election, but only won the support of a minority of MSPs. Some MSPs who opposed her were said to have turned down the initial posts they were offered.
John McGlynn, a party donor, said: “The appointments process has been a disaster. It is actually embarrassing.” He also claimed that allegations Davidson had benefited from party establishment support during the contest remained raw.
“The problem with this election is the unanswered questions. Until these are resolved Ruth will struggle to establish legitimacy. The group of MSPs have to be utterly satisfied on these issues.”
On the failure of central office to launch an independent investigation, he said: “Any right thinking person has to wonder why people who have nothing to hide are not backing transparency.”
Asked yesterday about why his companies were late in filing their accounts, Malcolm Scott said: “Let me speak to my accountant and get back to you. There’s no issue. Everything is fine on the corporate side.”
Labour MSP Drew Smith said: “It’s hard to know whether it’s more serious to be trading whilst company accounts are overdue, or trading as a Tory in Scotland. It says a lot about the current Tories if their treasurer can’t put his own house in order.”
James Dornan, SNP MSP for Glasgow Cathcart, said: “First Ruth Davidson struggles to win support from her group, and now it looks like she’s not going to have any cash to fund the local government election campaign.”
A spokesman for the Scottish Tories said: “We won’t be commenting.”
