John Swinney admits 'ring-fenced' donations for a second independence referendum have been spent by SNP

His revelation comes five years after concerns over the whereabouts of the supposedly "ring-fenced" cash led to Police Scotland's Operation Branchform investigation and the conviction of the SNP's former chief executive Peter Murrell last week.

The donations were raised through an online fundraiser, promoted by the SNP's then leader Nicola Sturgeon in 2017, who was seeking to hold a second independence referendum in the wake of the Brexit vote in 2016.

The SNP pledged it would be "ring-fenced" for a future referendum, but questions about its use have been asked for years after it appeared to disappear from the party's accounts.

The party has previously denied it was used in the snap General Election of 2017, but never gave a clear account of where the money was.

It was questions around the fund in 2021 which saw the then party treasurer resign claiming he was not being allowed to see the books by Peter Murrell. Three members of the party's finance committee also resigned citing similar issues.

And it was a report to the police about the "missing money" which triggered its £2m five year long investigation.

Now, in the wake of Murrell's conviction for embezzling more than £400,000 of SNP money, questions about the "ring-fenced fund" have been raised again.

Today John Swinney was asked directly what had happened to the money.

He said: "That money is part of the resources that are available within the Scottish National Party to support its independence objectives. And the SNP is a party of independence. And that's what we campaign for. We just campaigned for Scottish independence at the Scottish Parliament elections.

He added: "I'm saying it's part of the ongoing activities of the Scottish National Party and we're the party that campaigns for independence and we've just fought an election campaign in which we had a very, very strong anchoring of our campaign for independence. So if that's not the use of the resources, then I'm not sure I understand what the resources are for."

Pressed on the fact that the money was supposed to have been "ring-fenced" as pledged he said: "What's important is that the SNP's resources are used for the purposes for which they are intended. And that's exactly what I want to make sure is the case."

Asked again if those who donated deserved to know exactly how the money was used, given there has been no second referendum, Mr Swinney said: "What I'm saying is that the SNP is a party of independence that uses its resources to support the arguments for independence."

Opposition parties said his "confession" proved there needed to be a wider inquiry into how the SNP found itself the victim of embezzlement.

Scottish Labour deputy leader Jackie Baillie said: “SNP members and supporters donated their hard-earned money believing it would be used for a future referendum campaign. John Swinney has now admitted that it became part of the SNP’s general resources.

“People will rightly ask whether they were misled. They will rightly ask why the SNP continues to resist scrutiny. And they will rightly ask why John Swinney is so desperate to avoid a full inquiry.

“Up to one million pounds may now have been stolen from SNP members - they and the public deserve answers about this criminal enterprise masquerading as a political party."

Scottish Conservative leader Russell Findlay said: “John Swinney’s confession that the SNP spent ‘ringfenced’ referendum money on other things is damning.

“SNP members are still being hoodwinked about how Swinney and Nicola Sturgeon enabled Peter Murrell’s 12-year-long theft of their cash by shutting down scrutiny.

“Swinney’s small-town bank manager routine just won’t cut it for those whose hard-earned cash was either stolen by Sturgeon’s husband or mis-spent by the SNP.

“This surely destroys any residual trust in this shady political party whose tactics of dishonesty, intolerance and omerta increasingly resemble that of an organised crime group.”

And former SNP MP, Joanna Cherry, who resigned from the party's NEC in 2021 over transparency issues, said on X: "I see John Swinney has finally admitted that the “ring fenced” fund for a second indyref was spent on other things.

"Apart from the deceit perpetrated on the donors this does rather beg the question of how the SNP would fund a second indyref campaign if they got a section 30 order."

John Swinney has said repeatedly the party has since changed its governance procedures, and its financial checks and balances now involve three people.

Pressed again today on a parliamentary inquiry, he said: "I think what we've done is we've addressed the issues about which people are concerned. We've had a governance review. The party's democratically formulated its response.

"I've made a number of commitments to the party about how internal governance will be taken forward in an open and transparent fashion, and that's been delivered."