EXCL Lib Dem bosses called to emergency finance meeting as row over staff layoffs brews
Lib Dem bosses have been summoned to an emergency board meeting amid a financial crisis in the party that is set to see up to quarter of staff laid off.
Board members are expecting an “angry” exchange of views at the summit next week, with some blaming the current turmoil on bungled financial management.
It was revealed last week that up to 20 Lib Dem staffers face the chop after a black hole worth hundreds of thousands of pounds was discovered in party coffers.
Lib Dem chief executive Sir Nick Harvey has blamed the issue on “donation fatigue” after three years of major election and referendum campaigns in Britain.
But senior Lib Dem insiders told PoliticsHome the party had exacerbated the issue by misreading the books and taking on a string of extra staff it could not afford.
“Had the figures been read right all along it would have been a tough year,” one source explained.
“But it wouldn't have been the kind of tough year where in October you realise you have to sack a quarter of your staff.”
Another said: “It is fair to say that there have been failures in financial management that have contributed to the problem.”
Lib Dem president Sal Brinton called the special board meeting, which will take place on Tuesday evening.
Sources said the party had been struggling to control its finances since former chief executive Tim Gordon - said to have an “iron grip” on the issue - stood down in 2017.
Current chief executive Sir Nick said the party was cutting down on staff to “marshall our available firepower” towards campaigning for upcoming elections.
“In common with both other parties we have seen a dip in our income in the year after an election, made all the more acute after two elections (and a referendum) in two years,” he wrote in a blog for the Liberal Democrat Voice website.
“Donation fatigue and lower revenues are understandable at this point.”
He added: “This is a phenomenon we have seen many times before. Politics is a cyclical business, with parties consolidating after elections and then building up again before the next.”
The Lib Dems have around 80 staff members at their central London headquarters and dotted around the country.
At a meeting last week they were told around 20 could take voluntary redundancy, with compulsory redundancies to come afterwards if needed.
The party has attracted new members since the EU referendum but was left with a £700,000 deficit on its books in 2017.
Figures from the Electoral Commission show the Lib Dems received almost £2m in donations in the first three quarters of 2018 - compared with £5.5m for Labour and £12m for the Conservatives.
A Lib Dem spokesperson said: “We are in the process of carrying out a reorganisation which will see a reduction in the number of staff at our headquarters.
“We are focussing our resources to carry on leading the fight against Brexit and taking on power and privilege to build a country where everyone has the opportunity to succeed.
“Since gaining seats in last year’s general glection the Liberal Democrats have been winning seats in council by-elections across the country and are leading the fight to stop Brexit through a People’s Vote.”