Ex-Tory donor Arron Banks gives £1m to UKIP

media captionUKIP leader Nigel Farage: "Mr Nobody has bitten back"

Former Conservative supporter Arron Banks is donating £1m to UKIP.

He said he had been intending to give £100,000, but had raised that to £1m after William Hague downplayed his past significance to the Tories.

The former foreign secretary said he had never heard of Mr Banks, who previously gave £25,000 to his party.

UKIP leader Nigel Farage said he was "delighted" by the donation, which he said would go to support the party's general election campaign.

The move follows the defections of two Tory MPs - Mark Reckless and Douglas Carswell.

Mr Banks told journalists he had been a Conservative "all his life" but believed the UK would be better off outside the EU, which he described as a "closed shop for bankrupt countries".

Analysis by political correspondent Ross Hawkins

The ruder their opponents get, the more UKIP like it. Arron Banks says he gave 10 times as much as planned to the party because William Hague suggested he was a nobody.

That suits a party that thrives on playing the outsider. So will the money, of course.

Fighting a series of by-elections a few months before a general election won't come cheap. But expectations about the latest announcement were very high.

A man whose name meant nothing to Mr Hague - and many others - before today donating to UKIP won't worry Conservatives nearly as much as defecting MPs.

And it won't come close to overshadowing the tax cuts announced in the prime minister's conference speech.

The businessman, who co-founded the Brightside insurance firm and now runs the Go Skippy business, said he had been upset by Mr Hague's comments after his defection was revealed.

"I woke up this morning intending to donate £100,000 to UKIP and I understand Mr Hague called me a nobody.

"So, in light of that and because I am a strong advocate of leaving the European Union, I have decided today to donate £1m to the party and not the £100,000 we originally agreed."

media captionWilliam Hague says Conservatives at the conference remain 'upbeat' despite defections to UKIP

Suggesting he would rethink his allegiance if the Tories reconsidered their position on Europe, he added: "They (the Conservatives) win when they are conviction politicians. They do not win when they are as they are now".

Mr Banks said he was "absolutely convinced" that other business people would seek to "bankroll" UKIP in the run-up to next year's general election.

Mr Farage said his new recruit had "bitten back" in the face of Conservative barbs.

He said the party needed money as it did not have access to funding from the trade unions, or the financial support available to opposition parties in the House of Commons.

Reacting to Mr Banks' switch earlier on the final day of the Conservative conference in Birmingham, Mr Hague had said: "The conference has fully moved on from the defection of one MP on Saturday and the gentleman you're talking about is not a senior figure in this party, not someone I know at all."

UKIP's finances

According to its latest statement of accounts, UKIP's income in 2013 was £2,479,314, of which donations accounted for £1.373,031.

This was double the total amount it received in the previous year - £1,227,802 - and the party's income now stands at the highest it has ever been.

Nigel Farage's party raised £1.4m from April to June this year - £170,000 more than the Lib Dems. It also topped the list of highest gifts to any single party, after receiving just over £1m from Paul Sykes, a former Tory donor, over the same period.

UKIP and the Conservatives are at odds over how much Mr Banks has given to the Tories.

A spokesman for Mr Farage said Mr Banks funded the Chipping Sodbury office of the South Gloucestershire Conservatives "to the tune of £250,000".

But the Conservative Party agent in Chipping Sodbury, Sonia Williams, said the support given by Mr Banks was "nothing like the order of magnitude" of the sums claimed by UKIP.


She estimated the total support given by Mr Banks was "probably around the £22,000 mark".

The Conservatives say Mr Banks donated a total of £25,000, split between two Conservative branches, and loaned £75,000 to one branch in 2007. They said he had not made any donations since 2009.

These figures were confirmed by the Electoral Commission, which said the two recorded donations were of £20,000 in 2007 and £5,000 in 2009.

It said the £75,000 loan had been made by a company called Panacea Finance, part of the Brightside insurance group co-founded by Mr Banks.

BBC political editor Nick Robinson said there would be relief that the latest Conservative to switch to UKIP was "not a big figure", but added: "Having said that, it is the theme of this conference underlying the surface, which is 'could they stop the Tories winning?'"

The Conservatives say that electing them at next May's general election is the only way for people to ensure there is a referendum on UK membership of the European Union.

More on this story