Hard to tell after wiring is modified like this, but...it's probably either a wire crimped and bare in the sharp corner inside the clubmans, or inside the headlight bucket, or something along those lines. If the keyswitch is getting warm, there's a short somewhere that is pulling current that should not be. Check inside the headlight bucket first, then those wires you surely beat up a bit when trying to put them through clubmans. The insulation is many years old, and brittle now.