New Christopher Steele allegations highlight vulnerability of British politics

In the polarised world of 2025, how much credence one puts in the Russian sources of Christopher Steele is probably a good guide to how one thinks about many other issues.

The former chief of MI6’s Russia desk was a huge thorn in Donald Trump’s side during his first presidential term. In the aftermath of Trump’s return to power with a strengthened mandate, Steele’s cause looks a more quixotic one. Yet a changed US approach to the Russia-Ukraine War is bound to prompt renewed interest in his allegations, particularly in Europe.

So Steele’s appearance last week on a podcast about Russian influence in Britain was particularly timely. In the ‘Follow the Money’ episode of ‘Sergei and the Westminster Spy-ring’, he gave presenters Carol Cadwalladr and Peter Jukes new insights into his evidence to the Intelligence and Security Committee of Parliament.

The Committee completed a report on Russian political interference in 2019. Its publication was delayed by the Johnson Government until after that year’s general election, and some of its contents remain redacted.

Steele was one of the Committee’s expert witnesses, and his account of his testimony may provide a clue to the missing material. Based on information from his Russian contacts, he believes that the GRU military intelligence service was funding supporters of Brexit in the run-up to the 2016 referendum.

There was definitely money involved. There was consciousness of loopholes in the British system, whether it was the Northern Ireland anonymous political donation issue, whether it was the Scottish Limited Partnerships, is it called, which then became I think Welsh Limited Partnerships. So there were various loopholes that the Russians became aware of. The impression was that their oligarchs, their business structures, had stumbled across these things, told the government, and then the government used it to fund intelligence operations.¹

The rule allowing anonymous political donations in Northern Ireland was abolished in 2018. However, the legislation was not backdated to provide transparency about the referendum period.

That means that we still do not know the ultimate source of the largest donation in Northern Irish political history, a £435,000 gift which the Democratic Unionist Party used to campaign for Brexit in England. The money was channelled through the Constitutional Research Council, an obscure organisation with some fairly esoteric links. Investigative journalist Peter Geoghegan revealed in 2017 that its chair was a former business partner of Prince Nawwaf Bin Abdul Aziz, past head of Saudi Arabia’s General Intelligence Presidency.

In this context, Steele’s comments are strikingly suggestive. That in itself is reason to be wary given the possibility that some of his sources might be passing on deliberate disinformation, designed to stoke existing political tensions.

Yet the vulnerability of British politics to foreign financial influence is not in doubt. The National Security Act 2023 is intended to address that threat, but measures such as a foreign agent register are unlikely to deter a determined covert actor on their own.

During the Act’s passage through Parliament, former MI5 Director-General Lord Evans supported a defeated amendment that would have required political parties to carry out due diligence on the true source of donations.

Under Evans’ chairmanship, the Committee on Standards in Public Life called for similar measures in a 2021 report on electoral finance, along with the range of other reforms.

Much of this agenda came close to being adopted by the Labour Party ahead of its election victory last year, according to Patrick Maguire and Gabriel Pogrund, two journalists who have taken the baton from their Times colleague Tim Shipman as chroniclers of contemporary British politics.

In an excerpt from their latest book, Get In, they reveal that Labour was planning to support an ‘outright ban’ on foreign donations, but reversed course after an intervention from Lord Alli, the party’s chief fundraiser.

..emails show that Morgan McSweeney, now Starmer’s chief of staff, gave the policy his backing. An adviser in Rayner’s team said he wanted to present the planned legislation as an attempt to stop people who don’t have “skin in the game” from “funnelling money in British democracy”.

However, a Labour official involved in discussions on the policy said the plans were abandoned after an intervention from Alli. “With a week to go Morgan pulled it … It turned out Waheed told Morgan to pull it, and so he did.” They said it was not clear why Alli intervened, and the peer did not respond to requests for comment.²

This is surely one of the many issues that Labour will have to return to as part of the great geopolitical rethink which Donald Trump is imposing on Europe.

1. Follow the Money, Sergei and the Westminster Spyring, 11 February 2025, c.37 min.

2. Patrick Maguire and Gabriel Pogrund, Labour dropped plan to ban foreign donors after Lord Alli intervened, Sunday Times, 3 February 2025.