Links between the Labour Party and the developer of the controversial Caltongate project in Edinburgh have come under renewed scrutiny following the disclosure that the company, Mountgrange, made a £4,000 donation for a champagne reception at a Scottish Labour Party fund-raising dinner.
The company’s decision to sponsor the event was called “unwise” by Margo MacDonald, the independent MSP for the Lothians, while Ewan Aitken, the leader of the Labour group in Edinburgh City Council, accepted that his party’s association with Mountgrange had harmed “perception” of Labour.
The £300 million Caltongate project in Edinburgh’s Old Town has has been opposed by conservationists, but was supported by some members of the former Labour administration.
The company’s donation has attracted criticism because it was made in February as elections approached, and Labour’s majority the City Council was in doubt. Bob Cairns, a former Edinburgh convenor of planning said his party should not “have touched the money with a bargepole”.
In October, it was disclosed that Donald Anderson, the former leader of Edinburgh council, had been appointed Scottish director of PPS, a public relations company promoting Caltongate on behalf of Mountrange.
Ms MacDonald said: “It was pretty well established that some councillors had a very close working relationship with the company. That is case – and that allows you to judge whether it was wise of the company to have a champagne reception for Labour, and declare it during an election campaign. That is not clever at all,” she said.
Mr Aitken insisted that the Labour group on the city council was unaware of the donation until after the event, a fund-raising business dinner held in Glasgow on behalf of the Scottish Labour Party.
He said: “You heard what Bob [Cairns] said. I don’t think the association has helped the perception. But the notion that we were embroiled in something is simply not the case,” said Mr Aitken.
Meanwhile, Mr Anderson who was then still councillor for Kaimes in Edinburgh - said that he had attended the dinner but had only become aware of the Mountgrange sponsorship during the vote of thanks.
Scottish Labour officials stressed that fund-raising dinners were common to all parties, and that other businesses had registered similar sponsorship donations on this occasion.
Mountgrange’s donation is, however, the only one to have been made by the company to any political party which has been listed by the Electoral Commission.
A spokesman for the company said it had been invited to sponsor the event by Labour: “Given that the audience was largely senior business figures with whom we may do business, we were happy to agree to sponsor this on a commercial basis.”
The picture shows Donald Anderson.