Hundreds of donations to political parties are to be kept secret under plans being slipped through the House of Lords.

Labour and the Conservatives have been accused of collusion over plans to raise the threshold above which parties must report donations from £5,000 to £7,500. The move is opposed by heavyweight figures such as Lord Neill of Bladen, former chairman of the Committee on Standards in Public Life, who said that there was no real justification for the increase.

The Electoral Commission has said: “An increase of this level has the potential to reduce public confidence in the transparency and integrity of political funding.”

Michael Wills, the justice minister, who announced the changes, said that the levels had to be set at a level where the public could be confident nobody was “buying influence”.

Under amendments to the Political Parties and Elections Bill, the threshold at which donations to individual MPs and local parties need to be reported would also rise, from £1,000 to £1,500. Mr Wills said that this was to reduce the administrative burden that the process placed on volunteer activists. “We have to be careful about placing burdens on them, putting barriers in the way of this sort of activity, that might discourage these selfless volunteers from giving their time and effort,” he said.

Since the last general election the Conservatives alone have received 179 donations between £5,000.01 and £7,500 that, under the new arrangements, would not have to be declared.

The move is likely to be lucrative for political parties because it means people who want to give anonymously can give larger sums.

The Tories want local parties, which are funded by Lord Ashcroft’s marginal seats campaign, to be able to receive even more cash without declaring it. Jonathan Djanogly, the Shadow justice minister, said that the Tories were “reasonably satisfied” with the national threshold but wanted the local one raised from the £1,500 proposed by the Government to a figure of £3,000.

The Electoral Commission has made clear that it would campaign publicly against such a move.

Lord Neill, a crossbencher, told peers: “I don’t think any of these figures should be increased. There is no real justification for it. I don’t think it gives the right sort of feeling to the public in these days when parties are perhaps regarded with some suspicion.”

The Liberal Democrats are the only political party opposing the change. David Howarth, for the party, said that the proposals were “going too far in the direction of reducing transparency”. He said that he would caution Mr Wills “against making too many assumptions that public opinion would find this acceptable”.

From next year the Electoral Commission will also be able to make political parties show how money is being transferred between individual campaigns within the organisation.

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