Mammon’s Hold on the Labour Party

Finance firms gave Labour £2m in two years before banker bonuses U-turn

One might have hoped the great financial crash of 2008 would end, once and for all, Labour’s unseemly dalliance with the masters of high finance. But it seems the Party has learned nothing, as this reckless affair has been rekindled under Sir Keir Starmer.

Not only are we still paying for the sins of Bankers past, but Labour seems doomed to relive its failed romance, as mammon’s temptations lure Labour into another ruinous liaison with the money men of the City.

Bankers and City-linked firms have handed Labour the equivalent of £2m since the party launched its charm offensive on big business in 2022, analysis of Electoral Commission data shows.

This unseemly torrent coincides with Labour unveiling policies that could have come straight out of a masonic lodge meeting for bankers, Lawyers and Tories. The chequered board with its one-legged funny handshakes followed by solemn promises that have gifted away what’s left of our nation’s wealth. Ever the spurned lover, Labour debases itself to win favour from indifferent, Bankers…

This is a Labour Party happy to cap child benefits but not bankers’ bonuses…

The Faustian Pact Between Labour and the City

Recently Labour’s brazen financial tryst was on full display at a recent business conference, where banking giant HSBC sponsored the event and its executive was invited on stage to fawn over Shadow Chancellor Rachel Reeves.

Reeves went on to field questions from the press about the party’s U-turn 24 hours earlier on reintroducing the cap on bankers’ bonuses scrapped by the Conservatives last year.

Meanwhile, the wider Labour movement voiced outrage at the party’s cringing U-turn on a popular policy to curb excessive banker bonuses. Such craven behaviour exposes the sordid trade at the heart of this affair: money for influence, cash for compliance, lucre for loyalties.

The general secretary of the Labour-affiliated Fire Brigades Union (FBU) Matt Wrack hit out at the policy on X (formerly Twitter), describing it as “an utterly daft approach”.

“Tackling abuse by wealthy bankers would be a popular move and a vote winner,” he said. “The desperation from Starmer’s team to win approval from the people who run the finance industry is appalling.”

This of an utterly daft approach from Labour
Tackling abuse by wealthy bankers would be a popular move and a vote winner.
The desperation from Starmer’s team to win approval from the people who run the finance industry is appalling https://t.co/V8kufksGgu

— Matt Wrack (@MattWrack) January 31, 2024

The secondments and revolving door between Labour and City financers reek of the same stale corruption. MPs like Jonathan Reynolds and Tulip Siddiq accept corporate staff into their offices, while consultancies and lobbying firms with financial clients embed their people in Labour’s ranks.

SInce February last year, HSBC has provided a senior policy manager to work part-time in the office of shadow business secretary Jonathan Reynolds. It follows similar arrangements with NatWest and consultant lobbyist firm the Lowick Group in 2022.

MP Tulip Siddiq, who picked up Reynolds’ previous brief as shadow City minister following his promotion, has also benefited from secondments. In November, the international lobbying firm Global Counsel provided Siddiq with a member of staff who works in her office as a policy specialist – Harry Palmer, a senior associate in Global Counsel’s financial services practice.

Global Counsel, which is chaired by Labour grandee and Starmer adviser Peter Mandelson, recently published a list of UK lobbying clients for the first time since early 2022. They include the Bank of America and JP Morgan Chase.

Another secondee to the party in Siddiq’s office was brought in from City consultancy Oliver Wyman, with a specific brief to engage with financial industry bodies and feed into the party’s work on winning over the sector, according to the Guardian.

This insidious infiltration sees banking interests burrow into the very marrow of Labour policy-making.

Opendemocracy reports City consultants and professional services firms have also provided frontbenchers with staff, either on full secondments or alongside their primary roles. Both Ernst & Young and Grant Thornton LLP have members of staff currently working in Keir Starmer’s office, PricewaterhouseCoopers has donated more than £96,000 worth of staff time to the party, and consultants Beringa recently seconded a staffer to the team of Darren Jones, who is shadow chief secretary to the Treasury.

Overall, the value of secondments from firms with significant interests in the financial services sector totals more than £430,000 since January 2022.

Hedge fund first-timers and returning donors

Almost half of the total £2m from the wider finance sector that has flooded into Labour has come from individuals in the hedge fund, asset management and private equity sectors. Of this £980,000, just over £400,000 was given directly to the Starmerite campaign group Labour Together.

The official records reveal that Martin Taylor, a hedge fund manager dabbling in emerging markets, has become a leading patron of Labour. He was a major donor under Miliband but withheld his largesse during Corbyn’s tenure. Yet Taylor gave handsomely to Starmer’s leadership bid in 2020 and has since bestowed over £300,000, much of it funnelled through Labour Together to fund favored MPs.

Meanwhile Stuart Roden, former Merrill Lynch director, has been welcomed into Labour’s embrace under Starmer, providing £180,000 last year. Despite his roles at investment firms, Roden also sits on a right-leaning think tank founded by Conservative Duncan-Smith.

Other new Labor benefactors hail from the heights of banking – asset manager Kasim Kutay (£50,000), Grayden Reece-Smith (£45,000), Andrew Dyson (£25,000) and Garret Turley (£25,000).

David Blood, ex-Goldman Sachs executive now at a hedge fund, gave £100,000 in 2022 – his first UK political donation. And Irish hedge fund baron John Armitage, Tory donor in 2020, has offered over £100,000 to Labour’s coffers.

Fran Boait, co-executive director of Positive Money, said: “It’s hardly surprising Labour’s latest policies read like a love letter to the City when they’re being bankrolled by them.

“Labour must remember that it was chummy relationships with the finance sector that ushered in an era of weak regulation before the crash, ultimately costing the party power.

“This is precisely why we’ve called for caps on donations to political parties: to prevent politics being captured by vested private interests.”

Former chair of Lloyds Bank Victor Blank has also returned to the fold under Starmer, giving £125,000 since 2022, while Bank of London founder Anthony Watson has upped his contributions significantly, providing £167,500 to the party and a small handful of MPs including shadow health secretary Wes Streeting.

Emeritus professor of accounting at the University of Essex, Prem Sikka, described the close ties between political parties and the financial sector as “part of institutionalised corruption”.

Sikka, who sits in the House of Lords as a Labour peer, added: “Big business and the ultra-wealthy fund political parties in order to influence the policymaking and political agenda. They are effectively making an investment, and the return they expect may come in the form of honours, jobs, crony contracts, lax regulation or ineffective policy.

“It is unacceptable for Labour to continue with the practices which have been used by the Conservative Party.”

But a Labour spokesperson insisted: “Private sector support via secondments in no way influences or impacts upon Labour Party policy – we will always be driven by what is in the best interests of the country.”

Your Health and Wealth Sold Out

What is more surprising (some would argue more disappointing) is to see a cohort of extremely senior Labour Shadow Cabinet members taking large donations from the private healthcare sector. 

Four Labour frontbenchers reach the top 10 in the private healthcare entities and donations from those companies.

Sir Keir Starmer, the Leader of the Opposition and a prospective Prime Minister, has found himself enriched by the tune of £157,500.00 from donors associated with the private healthcare sector. Yvette Cooper, the Shadow Home Secretary, boasts an even more substantial sum of £295,205.00. Meanwhile, Dan Jarvis, juggling his role as the Mayor of South Yorkshire, has managed to secure a handsome £137,500.00 in donations from the private health industry. As for the Shadow Secretary of State for Health, the individual who would be entrusted with overseeing the NHS under a Labour government, his pockets have been lined with an impressive £193,725.00 in contributions.

They say there’s no such thing as a free lunch, and indeed, these sums of money are far from inconsequential. The private healthcare sector doesn’t shell out its riches for nothing.

Total all, on just the donations to the shadow Labour front bench, it’s a staggering £783.930. When you consider each pound contributed carries the expectation of influence and favours. You can only wonder what strings may be attached to such hefty donations.

You just have to ask the same questions you do when you see a Tory get a bung…What is expected in return? Surely, it is not a gesture of goodwill or a mere act of philanthropy.

No, it is a calculated investment, an attempt to exert influence, and perhaps even to shape policy decisions to benefit their wealthy benefactors.

The future of our National Health Service hangs in the balance, and it is disheartening to witness potential leaders of our country succumbing to the allure of private healthcare donations.

Mammon’s temptations have lured Labour into the arms of high financiers and with its other Succubus love for privet health, the bargain is complete.

Some may defend Labour, claiming their tryst with the City brings jobs and growth. But we know where such bargains with mammon lead. Labour already struck this Faustian pact in the Blair years, and it ended in economic catastrophe. The party would do better to heed the Biblical warning: “For what shall it profit a man, if he shall gain the whole world, and lose his own soul?”

The Faustian bargain complete, all that remains is for Starmer to start trumpeting the beneficence of inequality and why sweatshops lift living standards. Workers’ expectations sink lower as both parties compete in pandering to boardrooms. The race to the bottom begins…