The Trump administration is planning to allocate $12 million in funding to two organisations founded by prominent Conservative figures in the UK, according to US government documents seen by the Guardian.

The proposed grants form part of a wider package of financial support for European organisations that are viewed favourably by the current US administration. However, the plans have already attracted criticism from former American officials, who argue that using US taxpayer money to fund politically connected groups overseas risks blurring the line between diplomacy and political influence.

According to the documents, $7 million has been earmarked for 878, a newly established British think tank that says it is dedicated to preserving Western civilisation, promoting Britain’s cultural heritage and reducing mass immigration.

The organisation was founded by former Conservative minister Jacob Rees Mogg alongside his former special adviser Dr Radomir Tylecote. Tylecote has previously appeared alongside former Prime Minister Liz Truss and has claimed that Britain is no longer functioning as a true democracy.

The State Department describes 878 as a unique non partisan organisation focused on advancing fundamental freedoms in the United Kingdom.

The group was incorporated in the UK earlier this year, with its website launching in July. It says registration as a US non profit organisation is still pending. Its name references the year 878, when King Alfred the Great defeated the Great Heathen Army.

A further $5 million has been set aside for Free Speech Union International, an international organisation linked to the Free Speech Union, which was founded by Conservative peer Toby Young.

The State Department says the funding would support the organisation’s work promoting free speech and opposing what it describes as excessive digital regulation across the UK, Europe and Australia.

The Free Speech Union says it is politically independent and exists to defend people facing consequences for expressing their views. It has supported individuals from across the political spectrum, including Reform UK leader Nigel Farage and Palestine Action protesters.

Critics, however, argue the organisation has increasingly become associated with campaigns that align with conservative culture war issues.

Rees Mogg, Young and Tylecote were all due to appear this week at the first UK edition of the Conservative Political Action Conference, organised by Liz Truss. Earlier this month, Young warned during an appearance on Rees Mogg’s GB News programme that Britain’s approach to regulating social media risked damaging relations with President Donald Trump and Vice President JD Vance.

The proposed funding presents an early diplomatic challenge for incoming Prime Minister Andy Burnham, who has pledged to be open with President Trump whenever the two governments disagree.

The announcement also comes after German Chancellor Friedrich Merz criticised similar proposals to fund conservative aligned organisations in Germany, saying he did not want the American government or organisations linked to it interfering in German elections.

A spokesperson for the US State Department said the proposed grants are still undergoing the department’s normal review process and no final decisions have been made.

They added that all foreign assistance programmes are designed to support the administration’s strategic priorities.

Both awards have been classified as sole source grants, meaning they would be awarded directly without a competitive bidding process.

The documents also show that a further $3 million has been allocated to the Jobs Foundation, a UK charity that promotes business as a force for economic growth and job creation.

The charity is led by Matthew Elliott, the former chief executive of the official Vote Leave campaign, while its chief executive is Georgiana Bristol, formerly of the TaxPayers’ Alliance.

The proposed funding would support research into reducing regulation with the aim of encouraging greater American investment.

Former US State Department officials have strongly criticised the plans, arguing they depart from the department’s normal procedures for awarding overseas grants.

Several former officials told the Guardian they believe there has been a concerted effort by Trump aligned figures within the State Department to direct taxpayer funding towards conservative and MAGA aligned organisations across Europe.

One former official described the process as “outrageous and absurd”, arguing that sole source grants are normally reserved for organisations with unique expertise and should not be used to avoid competitive funding processes.

Another described the proposals as poor stewardship of public money.

The funding plans are outlined in a congressional notification covering spending by the Bureau of Democracy, Human Rights and Labor. They follow a wider shift in US foreign assistance policy, including new programmes designed to strengthen what the administration describes as Western civilisation, promote the rule of law and deepen transatlantic ties.

According to the documents, the funding for 878 is intended to strengthen the partnership between the United States and Britain by addressing issues including mass migration, censorship, lawfare and supranational governance.

The organisation’s website also highlights priorities including national defence, energy security, industrial renewal and the promotion of Judeo Christian culture.

Responding to the reports, Toby Young said Free Speech Union International had expressed interest in applying for funding but had not yet submitted a formal application or received any grant.

Meanwhile, the Jobs Foundation confirmed it is being considered for funding to carry out international economic research. A spokesperson said the charity is politically independent and looks forward to working with the new Burnham government, just as it worked with the previous administration and opposition parties.