One of the UK’s most influential rightwing thinktanks has deleted passages from its website promising access to government ministers in exchange for donations after the Guardian began making inquiries about its funding. The Adam Smith Institute, a neoliberal thinktank credited with inspiring some of the most controversial privatisations of the Thatcher and Major governments, offered…
One of the UK’s most influential rightwing thinktanks has deleted passages from its website promising access to government ministers in exchange for donations after the Guardian began making inquiries about its funding.
The Adam Smith Institute, a neoliberal thinktank credited with inspiring some of the most controversial privatisations of the Thatcher and Major governments, offered invitations to “power lunches and patrons dinners with influential figures, including politicians, ministers, journalists and academics” to anyone donating £1,000 a year.
The regulator, the Charity Commission, said on Friday that it had started examining the institute’s accounts for “potential areas of non-compliance” with accounting rules.
It is the second rightwing thinktank whose conduct is being examined by the commission for possible breaches of the rules.
Earlier this year the chief executive of the Institute of Economic Affairs was filmed by an undercover reporter appearing to promise a potential donor access to a minister in exchange for funding a report on agribusiness. The group says it is “spurious to suggest that the IEA is engaging in any kind of ‘cash for access’ system” and denies wrongdoing.
The Adam Smith Institute is made up of three different entities: a British company, a British charity and an American non-profit foundation, each with different rules on tax and the ability to carry out political activity.
In a 2012 book, Madsen Pirie, one of the institute’s founders, said: “It was a very messy patchwork and it took us years to sort it out. We used the term ‘Adam Smith Institute’ loosely to cover all our activities, no matter which heading they occurred under.”
Charities, which enjoy support from the British taxpayer, are required to be genuinely independent from other entities.
There are strict rules on how charities can spend their funds. Research and education are acceptable as long as they do not set out to promote a particular viewpoint, but political campaigning is banned.
The Guardian began making inquiries about the UK charity’s financial relationship with the UK company last week.
By Wednesday several passages on the institute’s website had been deleted, including the sentence: “We are a registered charity in the UK.” A lengthy passage describing a “two-pronged strategy for changing the world” was also deleted, as well as a section listing benefits for the institute’s financial backers. It is unclear why this was done.
Those contributing £1,000 a year were offered “opportunities to attend power lunches and patrons dinners with influential figures, including politicians, ministers, journalists and academics.”
Donors paying £5,000 a year were promised “a private events list, from which you can choose the Power Lunches and Patrons dinners you wish to attend.”
Financial accounts indicate that between at least 1993 and 2002 the UK company ASI Research was regularly loaned thousands of pounds by the UK charity Adam Smith Research Trust. The company began filing abbreviated accounts after 2002, making it impossible to see if the loans continued.
A spokesperson for the Adam Smith Institute explained that the UK charity reimbursed the UK company for costs it incurred in the course of business as a non-profit service company, rather than making grants.
“While it seems this structure was a common one some decades ago, it can on occasion lead to imbalances and hence the loan account that appeared in the 1990s,” the spokesperson said. “This complied with the advice of lawyers and accountants at the time and was fully reported in the public accounts of both bodies.”
The Charity Commission said: “All trustees of all charities must ensure they preserve their charity’s independence and make decisions that are solely in furtherance of their charity’s purposes.
“The public rightly expect trustees of charities to take these responsibilities seriously, and demonstrate accountability to the public for the way in which their charity is governed, and the work their charity undertakes.
“An important factor in demonstrating transparency is ensuring financial accounts are compliant with the accounting framework. We can confirm that we are examining the Adam Smith Research Trust’s financial accounts to examine potential areas of non-compliance with that framework.”
The development comes amid questions about the political campaigning activities of a network of thinktanks and groups linked to an address in Tufton Street in Westminster.