How Lord Alli – seen by some as an eccentric mix of Rasputin and Willy Wonka – schmoozed his way back to the heart of the Labour Party

One warm evening in early summer last year the thrum of conversation and ­laughter rang out from a penthouse apartment in the heart of fashionable Covent Garden.

As the champagne-sipping guests craned their necks to catch a glimpse of the guest of honour, caterers were busy readying the dining table laden with sparkling glassware for the inevitable toasts.

The scene was the £18 million London home of Labour grandee Lord (Waheed) Alli and the occasion a celebration to mark the astonishing ascent of Sue Gray from civil servant and Covid Partygate enforcer to Sir Keir Starmer’s newly unveiled chief of staff and right-hand woman.

Starmer and the team who would accompany him into Downing Street a year later were all there. And the guest of honour? None other than former prime minister Sir Tony Blair, Labour’s most successful ever leader and three time election winner.

The extent of Lord Alli’s largesse – suits and glasses for Starmer, designer frocks and the services of a personal dresser for Starmer’s wife Victoria, has triggered worrying questions about what kind of influence he exerts on the Government

in 2000, Alli he was to be found accompanying the then Prince of Wales on a visit to the Caribbean

For Lord Alli, who had been bankrolling Blair’s party since the heady days of New Labour, the jolly gathering was a ­Heaven-sent opportunity to cement his place as its pre-eminent powerbroker.

Seating Boris Johnson’s nemesis Ms Gray next to Sir Tony was a masterstroke. The architect of the 1998 Good Friday Agreement and the woman who mysteriously interrupted her career as a bureaucrat to run a pub in Ulster’s ‘bandit country’ ­during the height of the Troubles will surely have had much to talk about.

She could reminisce not just about her days pulling pints at the Cove Bar near Newry, Co Down, but also her two years as a senior figure in the Northern Ireland Executive at Stormont.

The dinner party could not have gone better for Lord Alli, smoothing his transition from networker to a key figure as Starmer drew up his timetable for seizing power at the upcoming General Election.

Ennobled by Blair, the diminutive television and fashion tycoon with a £200 million fortune had been a fixture in Labour circles for more than two decades – including an unlikely stint as an emissary in war-torn Iraq, of which more later.

His sprawling mansion in Kent was where his close friend Lord (Peter) Mandelson drew up Labour’s 1997 election ‘grid’ – the day-to-day timetable for the campaign. And it was also where he hosted an annual summer party with a Ferris wheel, dodgems and hot air balloon rides attended by the likes of Elisabeth Murdoch, influential daughter of the media magnate Rupert.

Alli, one of only a handful of gay Muslim politicians in the world, was a convivial host and generous with his money. Sought-after Prada handbags and Paul Smith shirts were frequently doled out to friends and staff. After Blair, his star faded. Under Ed Miliband and ­Jeremy Corbyn, he was cast to the margins. That hurt the peer.

Sir Tony Blair, pictured, was a guest of honour at the£18 million London home of Lord  Alli to mark the ascent of Sue Gray from civil servant to Sir Keir Starmer’s newly unveiled chief of staff

For Lord Alli, pictured, the jolly gathering was a ­Heaven-sent opportunity to cement his place as its pre-eminent powerbroker

Lord Alli received a Downing Street pass, after the election, unprecedented for a party donor

Despite his close friendship with Mandelson – or perhaps because of it – some in the Labour Party viewed him as an eccentric hybrid of Rasputin and Willy Wonka, writing cheques to secure his way into the company of political superstars with whom he ingratiated himself with lavish hospitality.

He has, however, risen again. In 2022 Sir Keir and other Shadow Cabinet members were among the feted summer party guests in Kent, and Lord Alli has since cemented his pivotal position in Labour’s highest ranks. Not bad for the South London-born son of immigrants who left his comprehensive school at 16 to support his parents. His Muslim father, a mechanic, was from a poor background in ­Guyana, where his family were indentured labourers, while his Hindu mother, a nurse, was from Trinidad.

But in recent weeks, the extent of his largesse – suits and glasses for Starmer, designer frocks and the services of a personal dresser for Starmer’s wife Victoria, as well as opening up his homes to Starmer and other ministers – has triggered worrying questions about what kind of influence he exerts on the Government.

Is he merely a generous benefactor, as he has always insisted, or is something more sinister going on? He is now the subject of two inquiries launched by Parliament’s standards watchdog. It began over an alleged failure to register interests and has been expanded after a subsequent complaint to consider his declaration of a company based in the tax-friendly British Virgin Islands.

Lord Alli said the omission was an ‘unintentional error’, adding: ‘I hadn’t realised that it wasn’t listed on my register of interests’. He has since declared his ­directorship of the company.

We know that, having showered Starmer and other senior ­ministers with £310,000 in gifts and services, he received a Downing Street pass, after the election, unprecedented for a party donor. This fact alone sparked widespread accusations of cash for access. Remarkably, even after the pass was returned, he was spotted in Downing Street on at least one other occasion.

According to Whitehall sources, the pass was arranged by ­Starmer’s then chief of staff Sue Gray, which makes his seating plan at that dinner party last summer seem an even greater stroke of genius.

According to Whitehall sources, the pass was arranged by ­Starmer’s then chief of staff Sue Gray

It has since emerged that before the election he not only accompanied Gray to ‘access talks’, he also worked with her to design the official policy matrix of announcements for Labour’s first 100 days in power

 It has since emerged that before the election he not only accompanied Gray to ‘access talks’, where Shadow ministers gave government officials notice of their priorities, he also worked with her to design the official policy matrix of announcements for Labour’s first 100 days in power.

How disappointing it must be for him then that this oh-so useful relationship came to a shuddering halt this week with the deposing of Ms Gray before Starmer even reached today’s landmark of 100 days at No 10.

And how ironic that she was ousted in part because of her failure to recognise the political damage caused by Lord Alli’s gift-giving as well as the myriad leaks, in-fighting and scandals about alleged freebies – from Taylor Swift concerts to football matches – that have overshadowed Starmer’s fledgling administration.

Of course, there have been no repercussions for Waheed Alli, but then he is the man who has ­bankrolled half the Cabinet. Among them are figures such as ­ambitious Health Secretary Wes Streeting who complains that Lord Alli has been unfairly ­targeted, saying: ‘He has ­contributed so much and never asked for ­anything in return.’

He may not have asked for anything, but this is not the whole story, according to figures at the House of Lords where, over 26 years, his contributions to political discourse can be counted almost on the fingers of one hand.

‘What Waheed would really like,’ says one associate, ‘is to be offered a job. What he would love is a desk at No 10, somewhere or something inside Labour Party HQ.’

What is intriguing is why such an offer has never been forthcoming. The closest to an official role may have been his aforementioned ­visits to Iraq at the height of the insurgency against British and American troops in 2005 after the Gulf War. He referenced those excursions during a Lords debate on Syria in 2013 when he claimed he had been ‘dispatched’ to Baghdad seven times. He did not elaborate, though the Cabinet Office has received freedom of information requests demanding answers.

Dispatched by whom is unclear. In his memoir Blair doesn’t even mention it – probably because Alli’s mission to help form a stable government was a failure. ­Britain’s preferred candidate for Iraqi leader, Iyad Allawi, not only had no enthusiasm for Alli’s meddling – the peer apparently wanted ‘focus groups’ to coordinate campaign messaging – but was also very unpopular with the electorate and he lost heavily.

During that same debate Alli disclosed that he had had ­multiple meetings with brutal Syrian dictator Bashar al-Assad – but at whose request and when is similarly unknown. What is known, however, is the identity of those who accompanied him.

The Labour Party’s then general secretary Margaret McDonagh was said to have arrived with Alli to Iraq full of the ‘classic New Labour ploys’ of analysing polling data, something that was not just unheard of but also extraordinarily inappropriate in a warzone.

Most recently, Lord Alli allowed deputy prime minister Angela Rayner to use his £2 million New York apartment, where she enjoyed a holiday

Rayner, pictured, has said she did not believe she had broken any rules in accepting the freebie, though she did not declare that her then boyfriend, former MP Sam Tarry, had stayed there with her

A Blair source recalled: ‘Tony liked him and Waheed was very helpful on things like the TV party political broadcasts, but he always thought he was too much of a loose ­cannon. He wasn’t sure enough of him to give him a job’

Associating himself with powerful women at the top of the Labour movement was a pattern Lord Alli was to repeat many times over the years. Most recently he allowed deputy prime minister Angela Rayner to use his £2 million New York apartment, where she enjoyed a holiday.

Rayner has said she did not believe she had broken any rules in accepting the freebie, though she did not declare that her then boyfriend, former MP Sam Tarry, had stayed there with her.

Throughout his career, Lord Alli has been drawn to strong, more mature women. McDonagh, who died from brain cancer last year aged 61, and Alli were close friends for 25 years. She became Labour’s first woman general secretary in 1998, the year Alli went to the House of Lords.

When she was struck down by her terminal illness he loaned her sister, Dame Siobhain, herself a Labour MP, £1.2 million to buy a flat with ground-floor access which she shared with her sibling until her death. Alli was said to be devastated by her loss.

It was through Ms McDonagh that Alli first got to know Keir Starmer and, courtesy of his cheque book, made himself indispensable. ‘Keir is the first Labour leader since Blair he has been truly enthusiastic about. He thinks he’s got a vision,’ says a friend of the peer.

When Starmer swept to power, the usually camera-shy Alli was pictured in Downing Street. His presence there on July 5 was testament to his staying power.

Scrutiny of Labour accounts shows how vital he was, chairing the party’s election fighting fund and helping to raise a staggering £9.5 million, a sum which dwarfed the efforts of Tory treasurers who managed a meagre £1.9 million.

Among those who answered his call for funds was his former ­business – and romantic – partner Charlie Parsons, with whom he once lived and is still a close friend. Parsons donated £350,000 to Labour in the run-up to the election.

In 2000 Alli he was to be found accompanying the then Prince of Wales on a visit to the Caribbean. They made quite a sight, the prince and the colourful lord, as they picked their way through the potholes and open sewers that run through Georgetown, ­Guyana’s capital.

He owed his presence to another powerful woman, on this occasion his friend Baroness Amos, 70, a leading Blairite.

He was then much better known as the successful figure behind the Planet 24 TV firm which brought the Big Breakfast Show to Channel 4. Asked why he was on a royal tour, Alli diplomatically replied that he was there to see what he could learn.

If he hoped it might lead to that long-wanted job inside Labour, he was to be disappointed. A Blair source recalled: ‘Tony liked him and Waheed was very helpful on things like the TV party political broadcasts, but he always thought he was too much of a loose ­cannon. He wasn’t sure enough of him to give him a job.’

Instead, Waheed made it his business to cultivate powerful political people. It worked across the political divide. We can reveal that one of his closest friendships is with the Conservative grandee Viscount Astor, stepfather-in-law of David Cameron.

The two went into business. They collaborated on securing media intellectual property rights and made a lot of money.

‘We were partners and were ­successful,’ says Astor. One notable success was Silvergate, a company they later sold to the Disney family; another was sold to Sony.

‘We got on well,’ adds Astor whose wife is Samantha ­Cameron’s mother. ‘Waheed has become a close family friend, all my children know him. I don’t think we ever had a cross word, not even on politics.’

Alli, he says, is a ‘thoroughly decent person’ and is devoid of personal ambition.

A generous encomium. But then some might say that, thanks to his wads of money, he has anyway achieved political power without the tiresome inconvenience of having to stand for election.