UKIP donor defects to Tories

The UK Independence Party today suffered a massive blow as billionaire donor Paul Sykes announced he was defecting to the Tories.

The Eurosceptic businessman gave Michael Howard a huge boost by announcing that he was pulling his funding of UKIP over its plans to field candidates in Conservative seats.

However, UKIP leader Roger Knapman dismissed calls for him to quit in favour of Robert Kilroy- Silk, claiming that activists would be committing "hari kiri" if it embarked on a leadership battle.

The double crisis of the loss of Mr Sykes's millions and leadership plotting shattered the anti-EU party's morale just days after its annual conference celebrated its success in this summer's European elections. Mr Sykes, who donated ?1 million towards UKIP's ?2 million campaigning this year, said that the party had "blown it" following its decision this weekend to field candidates in every seat in Britain, including those held by Eurosceptic Tories.

He said: "Better policies seem to be coming out of the Conservative Party than I have heard in many, many years.

"It looks like they're waking up to the fact that it is not a bad idea to make our own laws in our parliament by own people, rather than importing them from unelected Brussels."

He denied that he had been in any talks with Mr Howard about ditching his backing for UKIP, saying: "I have had no meetings, I have just been listening, like other people are, to what has been said."

Tories are extremely wary of Mr Sykes's previous promises to offer money and he made clear today that he had not yet made up his mind whether to transfer funds to the Conservatives.

"I haven't decided that yet. What I have decided on is not to assist UKIP at the next general election.

"I will continue to campaign and am warming to what I am hearing from the Conservative party," he said.

Mr Sykes said that his most important priority was to stop Labour from getting re-elected and the anti-EU party posed little threat to the Government. An embattled Mr Knapman dismissed suggestions that he should step aside as his supporters pointed out that it was Mr Kilroy-Silk who had led the drive to "kill" the Tories in every seat.

Mr Kilroy-Silk ignited the leadership row on Sunday by saying that he had a "gentleman's agreement" with the UKIP leader that he would take over the reins after June's European, local and Greater London Authority elections.

Speaking at his home in Dorset, former Tory MP Mr Knapman denied that he had any gentleman's agreement with the former television presenter to hand over power after this year's elections.

"There has never been a discussion with me about it, let alone an agreement," he said.