Ukip demotes Neil Hamilton as party fears over sleaze grow

Former Tory minister Neil Hamilton has been axed from his role as Ukip's campaigns director.

He has been replaced by the party's director of communications, Patrick O'Flynn. Although insiders claim Hamilton's demotion resulted from fears that his political disgrace after the late 1990s "cash for questions" scandal left Ukip vulnerable to accusations of sleaze, O'Flynn said: "The party leadership decided we were entering a particularly active phase of the campaign, where communicating the message becomes the most important thing. As a result of that, the leader and chairman asked me to take on the additional role of campaigns director early in March."

Hamilton refused to comment on his demotion, which the party kept quiet in a bid to minimise negative publicity. He failed to correct Jonathan Dimbleby when introduced as European campaigns director on Radio 4's Any Questions? a fortnight ago. Regarding Hamilton's omission, O'Flynn explained: "It would have been rather awkward to say 'Actually that's wrong' live on air."

Hamilton is understood to be retaining his position as vice chairman of the party, but his role leading Ukip's European and council election campaigns was in danger from early last month after he upset colleagues by publicly accusing Ukip's main donor, Yorkshire-based tycoon Paul Sykes, of failing to deliver the finances he had promised.

A senior source within Ukip, who asked not to be named, said of Hamilton: "He's been demoted to regional support. After he criticised Paul Sykes, Sykes said the party wouldn't see a penny of his money if Neil was in charge of the campaign." The source added that Nigel Farage was not happy with Hamilton's criticism of Sykes at the party's spring conference, but added: "Nigel still has some regard for his political skills."

There is widespread resentment of Hamilton among party members who see him as a "Tory with baggage". O'Flynn conceded that Ukip supporters tend to take a dim view of party officials formerly affiliated with the Conservatives, but denied there was a targeted dislike of Hamilton.

O'Flynn said: "A lot of our members, perhaps even most, who have come from parties other than the Conservatives or who have not been involved in party politics before, are likely to not necessarily view former Conservative members as being their favourites within the party, but I don't think there's anything specific directed at Neil."

Ukip has strengthened its position in the polls again in recent weeks after two debates between Farage and Nick Clegg, despite questions being raised over the Ukip leader's finances last week. The latest polling conducted by Opinium/Observer reveals that Ukip has increased its share of the UK vote to 18%, far outstripping the Liberal Democrats at 7%.

Although Ukip has sought to minimise its exposure to expenses-related scandals, the Electoral Commission announced last week that Farage has "questions to answer" over the use of his British office.

The Times had reported that he was given an office by Ukip supporters to use rent-free 15 years ago, but only registered the donation, which he listed as a £1,100 non-cash premises gift, in 2004. The Electoral Commission has asked Farage to explain why he did not register the office every year.

A Ukip spokesman said: "As was always envisaged, Neil Hamilton is now focusing his work as deputy chairman on regional campaigning and motivation and fundraising."