Frank Hester will be the biggest Conservative donor in history, contributing £10m towards Rishi Sunak’s election and potentially another £5m on top of that – if the party keeps his money. A new name who first appeared on the donor scene last year, his contribution could make up almost half of the £34m the Tories are allowed to raise in the year before the next general election. However, pressure has been growing all week for Sunak and his party chair, Richard Holden, to hand back Hester’s cash after the Guardian reported that Hester had said looking at Diane Abbott makes you “want to hate all black women” and that the MP “should be shot”. Sunak belatedly acknowledged that the remarks, made in 2019, were “racist and wrong”, and Hester has apologised for making “rude” comments, while maintaining that they had nothing to do with Abbott’s gender or the colour of her skin, and that he abhors racism. And so, as it stands, the money remains in Conservative coffers and is likely to be bankrolling Sunak’s election campaign already. Even some Tories believe Sunak should hand it back given the outcry over Hester’s remarks. But the question in Conservative circles is whether the party can afford to return the money at this late stage. “Nope, no way, not going to happen. They’ll have spent it and I don’t see where they’d get that amount of money from again. It’s so much. And they are in election mode now,” said one former senior Conservative official on whether the party would hand back Hester’s £15m. The ex-political adviser said he was “gobsmacked” by the size of the cash sums that had come from the Leeds businessman, who has made his money from his company TPP, which has NHS contracts to provide the computing systems that look after 60m medical records. But he said the party would undoubtedly “style it out” rather than bow to calls for the cash to be returned, despite Labour’s jibes and campaign literature about how the Tories are funding their campaign on the back of Hester’s money. On the face of it, the Conservatives are outgunning Labour in terms of how much they have raised in the last year. The Tories generated £53m while Labour brought in £38m, if you include the £11.5m in public funds allocated to opposition parties. However, the picture looks different if you strip out the £10m contributed to the Conservative Foundation in the will of John Sainsbury, which is intended to be used in the longer term for candidate bursaries rather than general election spending. If the Conservatives had to hand back £10m out of £43m, while Labour had £38m for election spending, it would show Keir Starmer’s party potentially ahead in terms of financial firepower. Peter Geoghegan, the author of the book Democracy for Sale and a Substack of the same name, said the Tories were responsible for starting an “arms race” on donations from private individuals and companies by raising election spending limits by 80% from £19.5m to £34m last year. At the time, the assumption was that the Conservatives would outperform Labour significantly in terms of fundraising. Having raised the spending stakes, the Tory party finances are now starting to look over-reliant on a small number of very large donations in light of the Hester affair. “What’s really interesting is they feel like they can’t give it back, which suggests their finances are not robust,” said Geoghegan. “They have had big headline numbers but the Hester money is a massive chunk of that. “They have gone through a lot of donors. They lost a lot of traditional money after Brexit, which hasn’t come back. And the hedge fund donors from the Brexit years are not giving money in the same way. “So the Tories have a real structural problem, which is: who gives you money when you look like you’re not going to be in power any more? Who is willing to take a bet on helping you? They’ve done very well but it’s a couple of big donors, one of whom is Hester. If he’s out of the picture, it’s not clear who they replace him with.” With many of the old donors petering out after the turmoil of Theresa May, Boris Johnson and Liz Truss, and while power is fading away from Sunak and towards Starmer, the Conservatives have had to turn to new funding sources. Apart from Hester, there are a handful of very large and mostly new donors. These include Mohamed Mansour, who gave £5m last year and is a businessman and a former Egyptian government minister under the military ruler Hosni Mubarak. Another is Graham Edwards, the party treasurer and property investor behind Telereal Trillium, who has given at least £4m, and a third is Amit Lohia, a textiles magnate known as the “Prince of Polyester”, who has given at least £2m. All of them are relatively recent donors, in contrast to longstanding contributors such as the JCB boss, Anthony Bamford, who together with companies and family has given £10m over a period of decades. Campaign groups are hoping the furore around Hester’s remarks might prompt all parties to reconsider the case for reform of party funding to end the reliance on big donors, which has been made for decades. Daniel Bruce, the chief executive of Transparency International, said: “There’s just far too much big money sloshing around our Westminster politics in particular and that’s only going to get worse because the amount parties can spend on their election campaigning has been massively ratcheted up very quietly. There is no cap at all on how much a donor can give to an individual party.” In 2011 a report from the committee on standards in public life called Ending the Big Donor Culture recommended a £10,000 cap on how much an individual could give to a party each year. Tom Brake, the director of the campaign group Unlock Democracy, said there was a growing “dependency on larger and larger private donations, particularly from superdonors,” across the parties and it was “time to slam the door on the access and influence this money buys”. He said: “A strict £5,000 annual cap for individuals or companies would almost completely eliminate this risk. It would also encourage parties to reach out to a much larger base and rebuild mass membership, which used to be a feature of political parties. And it would stop the funding arms race the government has triggered.”