Could Labour’s cash crisis cripple the election campaign?

By Alex Smith / @alexsmith1982

A couple of important stories have done the rounds in the past 24 hours about Labour’s continued cash crisis, and the impact it could have on the party’s general election campaign.

The Sunday Times reported yesterday that:

“Labour’s banks have imposed a recruitment freeze on head office, and the party is operating just 20 of the 80 telephone lines it usually runs at its call centre in the months leading up to an election.”

Some of that apparent difficulty can be mitigated by the Labour’s new phone banks – which have allowed Labour supporters to take responsibility for speaking to voters away from the central party. It’s already been a huge success: in the first 90 days after its launch, 1,083 Labour members made 16,000 calls from their own homes – a resource that wil be hugely valuable during a short campaign.

But that can only achieve so much. With budgets tight – the party is still thought to have debts of around £15million – spending restraints will ultimately hamstring Labour’s ability to fight on the ground – particularly with Lord Ashcroft continuing to pour funds into key marginals.

Equally concerning is Jackie Ashley’s report – buried away in her comment piece in yesterday’s Observer – that internal Labour polling suggests that “Labour could return to the Commons with just 120 MPs or thereabouts, taking the party back to 1930s territory.”

That’s 45 fewer seats than the Tories got in 1997 and would be a net loss of some 236 seats from the last general election in 2005. Not all of those seats would fall to the Tories, who are unlikely to win anything like the 418 seats Labour won in ’97. But it would mean at least two terms in opposition – and perhaps longer.