Top Tory donors in £5m push for Brexit

Grassroots campaign to leave EU launched in response to Government’s £9m leaflet

MAJOR Tory donors are preparing to fund a grassroots campaign to leave the European Union following David Cameron’s decision to spend more than £9 million on a pro-EU leaflet, The

Daily Telegraph can disclose. Members of the Midlands Industrial Council, a group of businessmen that has funded the Conservative Party for 20 years, are planning to donate between £4 million and £5 million to the anti-EU campaign over the next 10 weeks.

It will be seen as an attempt to redress the balance following the Government’s decision to spend £9.3 million of taxpayers’ money to send a proEU leaflet to every home in Britain.

David Wall, the Council’s secretary, said his members were “incandescent with rage” over Mr Cameron’s decision to send the leaflet.

Their decision will come as a major blow to the Prime Minister ahead of the June 23 referendum and is a sign of the anger among many traditional Tory backers at the decision to publish the leaflet, which has been described as “propaganda” by critics.

It came as the International Monetary Fund (IMF) warned that a “Brexit” would cause “severe regional and global damage” and cause “major challenges” for Britain.

Both Mr Cameron and George Osborne, the Chancellor, seized on the comments by the IMF, which downgraded its growth forecasts for the UK because of the risk of a “Brexit”.

However, campaigners pointed out that the IMF had been “consistently wrong” in past forecasts and had been forced to apologise to Mr Osborne in 2013 for predicting that his austerity measures would harm the economy.

“The IMF’s warnings about our exit from the EU are stark,” Mr Osborne said. “For the first time, we’re seeing the direct impact on our economy of the risks of leaving the EU.”

Since Mr Cameron became Prime Minister in 2010, members of the Midlands Industrial Council have donated between £1 million and £2 million to the Tory party every year.

Ahead of last year’s general election, the Council’s members supported between 40 and 50 Conservative MPs’ seats, as well as the central party.

Mr Wall joined the Grassroots Out movement’s board earlier this year.

He told The Daily Telegraph that five members of the Council, who are all Conservative Party donors, have already put around £500,000 into the Brexit campaign. Asked how much the Council might donate to the anti-EU campaign ahead of the referendum, Mr Wall said: “I would say there is a potential of £4 million or £5 million.”

The Electoral Commission must decide by tomorrow whether Grassroots Out or the rival Vote Leave group is made the official Brexit campaign.

The two sides have been at loggerheads for months over the designation, which will give the winner the right to raise £7 million during the 10-week campaign.

All other campaigns will have their spending capped at £700,000. Vote Leave is seen as the favourite because it is backed by senior Tory politicians, including Michael Gove, the Justice

Secretary. Grassroots Out comprises five parties – including the UK Independence Party (Ukip), the Liberal Party and the new Communist Party of Great Britain – and 14 other organisations such as Leave.EU, Labour Go, Conservative Grassroots and the Democracy Movement.

Ukip will be allowed to spend £4 million because of its large vote share at last year’s general election.

However, each of the other 18 groups making up Grassroots Out can still spend up to £700,000.

This means that the Midlands Industrial Council members can donate to the individual groups in order to increase substantially the money being funnelled into the Brexit campaign.

Mr Wall added: “I believe that significant sums will now to go Grassroots Movement – the umbrella organisation – or Grassroots Out, either one.”

Mr Wall said that most of the council’s 27 members – whom he described as a group of mainly male “self-made people” – wanted Britons to vote to leave the EU.

Mr Cameron’s decision to send out the leaflet “has hardened a lot of people’s attitudes in the last few days”, he said. Mr Wall added: “This leaflet they are sending out – a number of my members are incandescent with fury about it. They see that as a blatant misuse of power.”

Any donations were “hypothetical” at this stage and “will be made by permissible donors themselves”, he said.

But Mr Wall insisted that the donations to the Out campaign did not un- dermine Mr Cameron’s leadership nor show that the Council’s members did not respect the Prime Minister.

He said: “This is an issue of conscience. It isn’t that any of my members disrespect David Cameron in any way, shape or form.

“We do hold him in very high regard. But in this area we think he is wrong.”

In 2006, the Council agreed to publish “in the interests of transparency” a list of its supporters, which included Lord Bamford, the chairman of digger manufacturer JCB.

‘A number of my members are incandescent with fury about it. They see that as a blatant misuse of power’