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Sunday, April 14, 2024

Following the money

As is well-known it is not just the Tory Party who give special treatment to their donors, all the parties are at it. As if to remind us of that fact, the Guardian reports that senior members of the shadow cabinet have held a private meeting with a group of financial services companies to discuss the party’s banking policies just weeks after one of the companies donated £150,000 to the party.

The paper says that six senior Labour figures – including the leader, Keir Starmer, the shadow chancellor, Rachel Reeves, and the shadow business secretary, Jonathan Reynolds – attended the meeting in Edinburgh last December, according to an investigation by the website OpenDemocracy:

Companies in attendance included the investment managers Baillie Gifford and Aegon, as well as Bloomberg and NatWest. Bloomberg had just donated its largest sum in years through its trading subsidiary.

According to a now-deleted LinkedIn post by an employee of one of the companies at the meeting, Starmer and his ministerial team offered those in attendance an “exclusive dive” into the launch of its financial services policy.

The revelations have sparked concerns about the possibility the party is allowing its top donors to help shape policy in a way that could further their corporate interests.

Steve Goodrich, the head of research and investigations at Transparency International UK, said: “Parties should scrupulously avoid the perception that they’re offering privileged political access in return for cash. The next general election looks set to be the most expensive in modern times, so it’s crucial that politicians of all stripes avoid stumbling into quid pro quos in the rush for funds.”

A Labour party spokesperson said: “It is standard practice for the Labour party to meet with the private sector.”

Bloomberg declined to comment.

Starmer and Reeves have made it a priority to win back support from the City of London in recent years. They have embarked on a series of meetings with business leaders described as the “prawn cocktail offensive 2.0”, in reference to similar efforts by Tony Blair in the 1990s.

As part of that, the party has overhauled its approach to the financial services sector, including appointing a panel of 10 advisers from the City and clarifying that it will not reimpose a cap on bankers’ bonuses.

In December, shadow ministers travelled to Edinburgh to present the new panel and to highlight their commitment to boosting the sector. Tulip Siddiq, the shadow City minister, told the Financial Times before the visit that her party had stopped “sneering at business”.

The OpenDemocracy investigation has found that during the visit, Siddiq and her colleagues attended a roundtable meeting convened by Bloomberg and the lobbying group Sovereign Strategy. Other senior Labour figures who attended included Anas Sarwar, the party’s leader in Scotland, and Daniel Johnson, the member of the Scottish parliament for Edinburgh Southern.

Electoral Commission records show that Bloomberg Trading Facility – the company’s platform for trading financial investment products – gave Labour £150,000 about a month before the meeting, the largest sum given by any Bloomberg company since the Brexit referendum in 2016. That single donation made Bloomberg one of the party’s top corporate donors for the whole year.

One of the lobbyists involved in setting up the meeting posted afterwards on LinkedIn that it had offered “a very thorough discussion on Labour’s vision and priorities for economic growth, outlook for the financial services industry and an exclusive dive into Labour’s launch of the financial services policy review”.

Labour later published a video from the event showing Starmer speaking while his shadow ministers looked on. The party did not say which companies attended the meeting, but the video shows Starmer telling them: “What you now see is a Labour party that is fundamentally different to the Labour party that fought the last general election. Unrecognisably different. And very obviously pro-business.”

The following month, Labour announced its new financial services plan, in which it promised to cut down 10,000 pages of regulations and ruled out a windfall tax on bank profits.

All of this is standard practice in politics nowadays but it is sad that it took a deleted Linkedin post to highlight the meeting. If we can't reform the way political parties finance themselves then we should at least expect some transparency.
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