No10 distanced itself from reports Labour plans to bring in a £100,000 annual cap on political donations, amid claims hard right billionaire Elon Musk wants to give Nigel Farage’s Reform UK $100million.

The X owner, who helped bankroll hard right Republican Donald Trump’s return to the White House, is said to be mulling giving Reform £79million, an amount unremarkable in US terms but massive for UK politics.

However Keir Starmer’s party made reform of the donation system part of its election manifesto after a string of controversies about the source of cash flowing into Conservative coffers.

Its manifesto included a pledge to ‘protect democracy by strengthening the rules around donations to political parties’.

Labour has also been hit by a major row over donations made by party peer Lord Alli to Sir Keir and his top team since the election.

The Guardian reported it was looking at a six-figure annual cap, which may come in at some point in the second half of this parliament.

However a No10 source said that a cap was ‘not a current priority’.

Mr Musk is a dual South African/US citizen and foreign nationals are barred from directly donating to UK political parties. However he could make one through the UK arm of one of his firms – and his father Errol has claimed he could claim UK citizenship, because he is eligible through his mother.

Mr Musk has already vocally expressed his distaste for the Labour leader, branding him ‘two-tier Kier’ over unfounded claims that racist rioters and their supporters online were treated too harshly after violence in Southport and elsewhere in the summer.

He even suggested that Sir Keir was setting up detainment camps in the Falkland Islands for rioters, a claim which he was later forced to retract.

Musk will serve in an unofficial capacity in Trump’s administration focused on slashing government waste. His political action committee America Pac spent more than $200million (£158million) to help ensure a Trump win, including a $1m-a-day giveaway lottery in the marginal state of Pennsylvania.

Now The Times has reported that senior Conservative figures and business leaders believe there is a real possibility of Musk making a huge donation to Mr Farage’s party.

Farage said he was unsure if Musk was planning to donate any money to Reform but the pair were in frequent contact and were good friends.

To put Musk’s rumoured donation in context, Reform UK raised a total of £1.6million over the whole general election campaign in the summer.

Political parties are required to provide weekly reports of donations of more than £11,180, after the Government increased the threshold from £7,500 in January.

Labour received more than twice the amount of donations than the Conservatives in the final week of the General Election campaign, new figures from the Electoral Commission have shown.

The party raised £465,600 in private donations in the last week before polling day, bringing its total raised for the whole election to £9.5million.

The Conservatives raised just £225,587 in private donations over the same period, bringing their total for the whole election to £1.8million.

A Ministry of Housing, Communities and Local Government spokesman told the Guardian: ‘As set out in the manifesto, we are working to strengthen the rules around donations to political parties to ensure we maintain trust in our electoral system. We will set out more details on this in due course.’