Will a million pounds make you a "Sir" or a "Lord" in Britain today?

That's what British police are investigating, following complaints that Prime Minister Tony Blair's Labour party rewarded four big financial backers with the promise of seats in the House of Lords, the unelected upper house of parliament that wields considerable influence.

The murky controversy has intensified pressure on Blair to step down and revived a debate about how politics should be funded here.

Infuriated members of Parliament (MPs), including some on the Labour side, warn that democracy is being compromised by dirty money. The scandal has further disenchanted a public already apathetic about the political process, and it is acutely awkward for Blair, who arrived in office in 1997 with a promise to wipe out the "sleaze" that poisoned the previous administration of John Major.

"The Labour Party has been caught cold," says Ian Gibson, a Labour MP. Though it has yet to be definitely proven that benefactors were promised in advance a reward for their cash, MPs have noted that every donor who has given Labour more than a million pounds has received a knighthood (entitling usage of honorific "Sir") or peerage (entitling usage of honorific "Lord").

"People don't give money for nothing and that is how all this is being construed by the public," says Mr. Gibson. "Some of these [donors] got knighthoods and even became government ministers.... We have to move to a system of state funding."

State funding is the norm in France, Germany, and other European countries, where individual and group donations to parties are capped or banned altogether.

Its advantages are a level playing field between parties and greater transparency. The disadvantage is that taxpayers will have to foot the bill, and parties will probably find loopholes, perhaps through lobby groups doing their spending for them. Critics also note that state funding in Germany did not stop former chancellor Helmut Kohl from getting engulfed in a scandal over secret private donations.

British parties have long relied on their memberships and on affiliations - Labour with the union movement, the Conservatives with big business - for their funding. But with party memberships falling fast, and old affiliations not what they used to be, income has shriveled.

All three big parties have turned to benefactors to bail them out. Blair introduced new rules in 1998 to oblige parties to declare all donations over £5,000 ($8,700), but loans don't have to be reported.

The Conservatives have said they too have benefited from big loans, but Blair is under scrutiny because as prime minister, he alone among politicians has the power to nominate individuals to lordships, knighthoods, and other honors.

Labour - Blair's party - has admitted it raised £14 million ($23.4 million) last year in secret loans from 12 millionaires to bankroll its election campaign.

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