Coalition parties return donation that was bequeathed by Joan Edwards to 'whichever government is in office'

The Conservatives and Liberal Democrats have agreed to give up a £520,000 donation from an elderly woman who wanted it to go to the government of the day, following criticism that they had accepted the money for party political purposes.

Nick Clegg ordered his party to hand over £100,000 to the Treasury and minutes later the Conservatives followed suit by relinquishing their £420,000 gift.

The decision to accept the money had been branded as "dodgy as hell" because the will of Joan Edwards suggested she would have been more likely to want the cash to go to the nation.

A copy of the document was tracked down by the Daily Mail, which found she asked for it to be given to "whichever government is in office at the date of my death for the government in their absolute discretion to use as they may think fit".

Both parties initially insisted early on Wednesday morning that it was up to the executors of the will to make a decision.

But less than an hour later, they had decided to give up the donations after MPs on all sides rounded on the coalition parties.

Steve Webb, the Liberal Democrat pensions minister, gave the first hint that his party would give up the money when he told BBC News that Edwards's wishes should be honoured.

His sentiments were echoed by senior Tories, including Conor Burns, the MP for Bournemouth West. He said on Twitter: "Whoever decided to accept a penny of Joan Edwards's money for the party has very poor judgment. We must return it before the morning is out."

Another Tory MP, Zac Goldsmith, said: "This needs to be sorted out now. No one can truly believe this lady wanted her money squandered on electioneering."

Lib Dem sources said that the executors of Edwards's will, who are legally in charge of her estate, had decided to donate to the Conservatives and the Liberal Democrats after consulting the Treasury solicitor and attorney general's office.

But after Nick Clegg saw the wording of the will on Tuesday night, he took the decision to hand it to the Treasury.

A party spokesman said: "The Liberal Democrats have taken the decision to pass the donation granted to us by the executors of Ms Edwards's will to the Treasury. Party officials have been instructed to contact the Treasury to make the necessary arrangements.

"The decision to give the money to the political parties was taken solely by the executors of the will. The party accepted the donation in good faith on the advice of the executors and on the understanding that they had sought advice from the Treasury solicitors and the attorney general's office."

Part of Joan Edwards's will, which said the money should go to 'whichever government is in office at the date of my death'.

A Tory spokesman said: "The solicitors for the deceased, acting as the executors, informed the Conservative party that it was a beneficiary of the will.

"However, to put the matter beyond doubt, we have decided to pass the money to the Treasury. As with all other donations to the exchequer, the money will be used to reduce the national debt."

In a further twist, solicitors Davis Wood insisted they had specifically checked with Edwards what she wanted to happen.

"The will was drafted by a solicitor at Davis Wood in 2001," a statement said. "At the time of the instructions received from the late Miss Edwards, the solicitor specifically checked with Miss Edwards about the unusual nature of her proposed bequest and it was confirmed by Miss Edwards at the time of her instruction that her estate was to be left to whichever political party formed the government at the date of her death."

Records show Joan Lilian Edwards was born in Bristol in 1921 and lived there all her life, but never married. She working variously as a nurse and midwife. She had lived in a three-bedroom council house in the city from 1931 until her death last year.

Friends told the Mail that she had never appeared to show an interest in politics and would have wanted the government to do something good with her money.

Edwards, who lived in Fishponds, a residential area about three miles from the city centre, died on 22 September last year.

Her will was drawn up in September 2001 with her executors named as the partners of Davis Wood. It was signed by Edwards in neat, old-fashioned writing.

The will left instructions for any debts, her funeral expenses and fees relating to sorting out her affairs to be paid before bequeathing the rest.

Another clause says she should be cremated and no service held for her. But she asked "that the vicar of St John's Church at Lodge Causeway Fishponds Bristol may be consulted over my funeral to see whether he would preside thereover".

Peter Wood, one of the partners who acted as executor, said on Tuesday: "I'd love to be more helpful but I'm going to have to say I have no comment at the moment. I really can't take it any further."

Asked about the suggestion that it was the executors' interpretation that the money should go to the parties, Wood said: "I'd be getting into areas I don't want to comment. I have read all of that. I can't take it any further."

Calls for the money to be returned first came from several Labour politicians.

Lord Prescott, the former deputy prime minister, said the Tories and Lib Dems "must hand back the £500k Joan Edwards left to the nation", and started a campaign to work out what to do with "Joan's half million".

Meanwhile, Jim Murphy, the shadow defence secretary, called for further investigation.

"Unless [the] explanation of this is much clearer [and] more credible this looks dodgy as hell by Tories [and] Libs," he tweeted.

Alistair Graham, the former chairman of the committee on standards in public life, also put pressure on the parties to give the money back.

He said they seemed to have "very quickly distributed the loot between the two of them" without conducting sufficient checks.