EXCLUSIVE

Tom Gordon

Scottish Political Editor

THE Scottish Liberal Democrats took £25,000 from a senior Tory donor to boost their spending in the referendum, the Sunday Herald can reveal.

The LibDems accepted the donation from Jitesh Gadhia, a London-based investment banker and member of the Prime Minister's inner circle, just days before the ballot on September 18.

Although there was nothing illegal about the cash injection, the SNP claimed it showed the Scottish LibDems had been reduced to "a wholly owned subsidiary of the Tory party".

The financial overlap between the parties is awkward for UK LibDem leader Nick Clegg, as he is trying to turn around terrible opinion polls by stressing his party's differences with their Conservative coalition partners.

Gadhia, a senior advisor at US global investment firm Blackstone, has given £225,000 to the Conservatives in the last five years.

By donating £50,000 in 2009, 2010, 2012 and 2014, he secured himself a place in the party's elite "Leader's Club" for high value donors.

The club's members enjoy dinners with David Cameron and other senior Conservative ministers, including Chancellor George Osborne.

In 2013, Gadhia was part of a UK trade mission to India led by Cameron, and was last year appointed to the board of the Treasury's banking recovery arm, UK Financial Investments Ltd.

However, despite his rock-solid Tory connections, Electoral Commission records show that two days before the referendum Gadhia gave £25,000 to the LibDems "Scottish State Party".

After the referendum, the 44-year-old resumed donating to the Tories, giving £8,020 to the Conservative Friends of India group in October.

The Sunday Herald understands the money was given to the LibDems to promote a No vote, as the official Better Together campaign was near its legal spending limit.

Under the rules of the referendum, the main Yes and No campaigns were allowed to spend £1.5m in the final 16-week "designated period", while party limits were set according to their share of the vote in the 2011 Holyrood election.

To avoid breaching its spending limit, Better Together accepted no large donations after July.

As the referendum neared, the Scottish Tories were also close to their £399,000 limit.

However the Scottish LibDems, who had a £204,000 limit but far less cash, had spending capacity to spare, meaning they could be used as a conduit for pro-Union finance.

Besides £25,000 from Gadhia on September 16, the LibDems also took £50,000 from Better Together donor Donald Houston just before polling day.

Houston, a hotel and distillery tycoon who had already given Better Together £800,000, had no history of giving money to a political party.

However the parent company for many of his firms, Lincoln-based Rain Dance Investments Ltd, gave the LibDems £50,000 on September 9.

Like Gadhia's £25,000, the money from Houston went to the LibDems "Scottish State Party".

The owner of Ardnamurchan Estate, Glenborrodale Castle and the Adelphi Distillery, 54-year-old Houston was the second biggest donor to Better Together after author JK Rowling, who gave £1m.

The LibDems ultimately spend £187,585 of their £204,000 limit, almost 40% of which came from Houston and Gadhia's eleventh-hour donations.

A senior SNP source said: "The LibDems have become a wholly owned subsidiary of the Tory Party - at a time when the polls are predicting a LibDem wipe out, the news that they are taking money from a long-standing Tory donor underlines why they have zero credibility in Scotland."

Gadhia declined to comment.

Houston could not be contacted.

The LibDems said: "Scottish LibDems were campaigning for a stronger Scotland in the UK. These donations reflect that. We are grateful for the support from all donors who supported our efforts to keep Scotland in the UK."