Elitist image dogs Conservatives

By Kylie MacLellan and Golnar Motevalli

OXFORD (Reuters) - As Britain hurtles into the deepest slowdown in more than 15 years, a party funding scandal has reminded the country of its most enduring schism: class. This does not bode well for the opposition Conservatives.

In a more buoyant climate the scandal -- involving Conservative finance spokesman George Osborne, posh drinking clubs, a yacht and a Russian billionaire -- may have made little more than tasty fodder for the country's voracious media.

But as many Britons lay blame for mounting redundancies on rich City bankers -- who in their white-collared stripy shirts are often closely allied to the party of the wealthy and elite -- it could not have come at a worse time for the Conservatives.

Traditionally seen as a bedrock of the upper classes, the party had been striving to broaden its appeal: a quick glance at its past leaders and chairmen shows a list littered with Barons, Viscounts and Lords.

Since David Cameron became leader in 2005, the Conservatives, or Tories, have worked to secure working-class votes if they are to end 11 years of Labour rule at the next election, due by mid-2010.

But the scandal in late October, involving Osborne, Russian billionaire Oleg Deripaska and their mutual friend the banking heir Nathaniel Rothschild, brought the Conservatives' elite connections firmly back into view.

Rothschild alleged that Osborne, his friend since they were members of an exclusive drinking and dining club at Oxford University, had tried to solicit a large donation to the party from Deripaska, whose yacht he visited in the Mediterranean last August. Osborne denied seeking any such donation.

The focus of the scandal -- sources of party funding -- is a topic which has dogged both the main parties. But it was the Conservatives' association with friends in high places and the exposure of an old boys' network that did the damage.