The Labour Party's new finance director is set to quit his post after only a month in the job. Howard Attree has also warned the party may be unable to find the £20m need to bankroll the next general election campaign.
His decision to leave the Millbank headquarters has been viewed by observers as a setback for the party as it gears up for the general election expected in just over a year.
Party officials fear that some big financial backers may be hesitating over donating money to Labour because a new Parliamentary Bill could force them to disclose how much they have given.
If backers fail to come up with the cash, Labour will be forced to beg the Unions for £10m when they meet later this month at a conference on a new financing agreement for the party.
Attree’s review of Labour’s finances is expected to recommend a full-time director be appointed. He had worked part-time for Labour since retiring from his previous post as treasurer of Brighton and Hove Council.
One reason for the falling Labour finances is a decline in the party membership.