THE CONSERVATIVES have been fined after failing to declare most of a donation which paid for the lavish refurbishment of the Downing Street flat. 

The Electoral Commission released its findings of the probe into the renovations this morning, ramping up the pressure on the Prime Minister following revelations that his staff held a Christmas party last year. 

In their report, the elections watchdog said it had uncovered "serious failings" in the party's compliance systems, which led to just £15,000 of a £67,801.72 donation being declared.

It said the failure was "not the first time" the party had been sanctioned for similar breaches, and "Such repeat non-compliance risks undermining public confidence in the political finance regime."

The watchdog also said statements provided from the Conservative party, that the money was a "‘gift to the nation’ rather than a donation to the party" and "a ministerial matter" were "not supported by the evidence subsequently obtained."

READ MORE: Electoral Commission to probe Johnson's Downing Street flat refurbishment

A £67,801.72 donation from Huntswood Associates Limited, whose director is Tory peer Lord Brownlow, was made on October 19 2020.

However only £15,000 of his donation was declared by the Conservatives, while the "remaining £52,801.72 was not", according to the watchdog's report.

It stated: "The evidence showed that the Conservative Party received a donation of £67,801.72 from Huntswood Associates Limited in October 2020 – £52,801.72 of which was to cover the cost of three invoices relating to the refurbishment of Downing Street.

"£15,000 was reported as a donation in the party’s Q4 2020 donation report; the remaining £52,801.72 was not."

The Commission concluded that "the full amount of the £67,801.72 was a donation and should have been reported to the Commission."

It added: "We also concluded that the reference to the payment made by the party for the refurbishment in the party’s financial records was not accurately recorded.

"The investigation found that decisions relating to the handling and recording of these transactions reflected serious failings in the party’s compliance systems."

The watchdog said the donation by Lord Brownlow was "incorrectly described in internal records and the full value of the donation was not correctly identified and reported." 

It added that other donations had been made towards the renovations of the Downing Street flat, however they were "not judged to reportable donations".

READ MORE: Downing St denies Tory party funded Boris Johnson's £60k flat refurb

More than £112,000 was paid by Lord Brownlow or his company Huntswood Associates towards the renovations.

Downing Street said at the time the Prime Minister had personally met the cost of the works.

Based on the Commission's report, it is unclear as to why Lord Brownlow also paid for the works, but does outline a reversal of the payments between his company, him personally, the party and the Cabinet Office in March this year.

It explained:"Following discussion and agreement between Cabinet Office, 10 Downing Street, the party and Lord Brownlow, between 9 and 23 March 2021:

- the supplier paid Lord Brownlow £112,549.12, of which Lord Brownlow returned £52,801.72 to the supplier

- the supplier then paid £52,801.72 to Cabinet Office, the sum Cabinet Office had originally paid to the supplier

- Cabinet Office then paid the party £52,801.72, the sum the party had paid Cabinet Office originally

- the party paid £52,801.72 to Huntswood Associates

"The net effect was that Lord Brownlow, Huntswood Associates, Cabinet Office and the party had been repaid.

"Any payments between the Prime Minister and the supplier are outside the scope of our investigation."

The Commission has fined the party £17,800 for failing to report the £52,801.72 donation. 

In the full report, the commission explained the Conservatives had recorded a payment of £52,801.72 as a "blind trust loan" but no trust had been established, and added that the record was "materially inaccurate". 

It added: "Internal accounting records are essential for ensuring that the party is able to comply fully with other statutory requirements. That is particularly the case for a party with a significant volume of financial transactions.

"The references to this transaction as a “blind trust loan” did not accurately reflect the circumstances. As a result, the party’s records indicated that it would be reimbursed when it had no guarantee of that, and therefore misrepresented its financial position."

The Tories are considering whether to appeal the fine.

A party spokesman said: “The Conservative Party has received notification from the Electoral Commission that, in their judgment, the manner in which a payment was reported represented a technical breach of reporting requirements under the Political Parties, Elections and Referendums Act.

“We have been in constant contact with the Electoral Commission with regards to this matter and have sought their advice as to how the transaction should be reported since it was made.

“We are considering whether to appeal this decision and will make a decision within 28 working days.”