John Redwood and other underground MPs for wealth and asset managers have been accused of having a conflict of interest because they cannot fairly represent their constituents against the deep pockets of UK industry of investment.
MPs’ incomes have come under scrutiny since former Conservative cabinet minister Owen Paterson resigned last week amid a lobbying scandal. The MP for North Shropshire has been paid over £ 110,000 a year to defend several companies, which is against parliamentary rules.
MPs receive a base salary of £ 81,932, but there is currently no cap on how much more they can earn.
Portfolio advisor examined the register of deputies’ interests and found that at least nine MPs are on the payrolls of investment firms, occupying a variety of roles ranging from board advisers to consultants and speakers at events. Their additional income reaches hundreds of thousands of pounds per year.
Robin Powell, editor-in-chief of Evidence-Based Investor, said no MPs should be in extra paid employment, but he has “an even bigger problem with MPs paid by asset managers.”
Powell claims the UK asset management industry is dysfunctional, poor value for money and has been poorly vetted by the Financial Conduct Authority. “These are matters that Parliament should take very seriously, so having MPs working for this industry at a time like this is unnecessary and inappropriate.”
John Redwood’s £ 200,000 salary
As Charles Stanley’s chief global strategist, Redwood (pictured) is one of the most visible black MPs to the investment industry.
Documents from November 1 show the Wokingham MP making £ 48,000 per quarter for 50 hours of work per month with the wealth manager, which includes writing a market review and two investment report times a week, the chairmanship of the investment committee and oral and written presentations. This works out to around £ 16,000 per month and £ 193,000 for the whole year.
On June 24, Charles Stanley awarded him a bonus of £ 35,000 for the work done during the past year, although he did not record any overtime.
Redwood is also a member of the advisory board of Epic private equity which pays him £ 5,000 a year in exchange for three hours of work per quarter.
Charles Stanley declined to comment.
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JOh Baron is another deputy improving its income through the investment sector. Longtime MP for Basildon and Billericay and IInvestor column journalist to throwran a wealth management company dedicated to investment trusts and AND F This year, next to City analyst Chris Grant. He holds a majority stake in the company, who has has attracted £ 30million in assets under management since its soft launch in January.
Baron receives £ 800 per month for his monthly FT investment column Investor column magazine, although all charges are waived in lieu of donating the newspaper to charities of its choice.
Supplement the income with lucrative speaking gigs
Others supplemented their income by accepting lucrative concerts.
Health Secretary Sajid Javid was paid £ 20,000 by Munizich & Co for an online speech he gave to clients of the fixed income manager.
Former Prime Minister Theresa May has garnered more than £ 757,000 in speaking engagements since April 2020, notably for JP Morgan Chase and Amundi Asset Management. However, most of this money goes to pay employees, maintain May’s “continued involvement in public life” and support her charitable work. Payments are made to Theresa May Limited’s office, from which she receives £ 85,000 per year with a planned commitment of 24 hours per month.
Wyre Forest MP Mark Garnier currently receives £ 10,000 per year, in quarterly installments, for work performed as a keynote speaker for BRI Wealth Management from April 1, 2019 to March 31, 2022. This includes speaking at the of eight client events and writing occasional articles. for customer newsletters, a total of 64 working hours.
MPs moonlighting with specialized investment managers
Many other deputies are remunerated in an advisory capacity.
Former Brexit Minister David Davis, who claimed the German auto industry would save the UK from a bad deal when it left the EU, is an advisor to THI Investments, the € 1.8 billion single family office of the Hagenmeyer family, which made its fortune in the automotive industry. Davis receives £ 34,000 for 16 hours of work per year for his work with THI Investments.
Andrew Mitchell, grossed £ 183,000 for 34.5 days of work in various financial advisory roles for Investec and Ernst & Young. Since 2019 he has been a senior advisor to specialist manager Arch Emerging Markets Partners, where he receives £ 15,000 plus VAT each year for 2.5 working days plus commission for the introduction of any new business.
Welsh MP Alun Cairns receives £ 30,000 a year from a Singaporean property investment firm and Wimbledon representative Stephen Hammond receives £ 60,000 a year for advising an alternatives manager in London. Cairns works up to 84 hours per year for Elite Capital Partners while Hammond spends between 50 and 100 hours working at Darwin Alternative Investments.
All nine deputies except one Portfolio advisor identified on the payroll of investment firms were from the Conservative Party.
Liberal Democrat Leader Ed Davey receives £ 4.5,000 every three months for 12 hours of work on the advisory board of specialist asset manager Next Energy Capital.
Conservative Party funded by individuals who made their fortunes in the city
Powell says that the potential influence of the fund industry lobby on elected officials is also alarming, noting that “several asset management companies make regular donations.”
He says “many deputies previously worked in the City, and many hope to be offered a lucrative job if they lose their seat ”.
Javid had a career in investment banking, working for companies like Deutsche Bank, before entering politics. After resigning from his brief tenure as Chancellor, he served on JP Morgan Emea’s Advisory Board on August 17, 2020, where he was awarded a generous sum of £ 150,000 for “providing advice on the global economy, major industries and geopolitics ”. He stepped down from the post after being appointed to cabinet in June.
“The fund industry lobby is extremely powerful and influential,” he says. “I not have a political party allegiance, but it must be said that the Conservative Party is largely funded by individuals who have made their fortunes in financial services.
“For all of these reasons, I would rather have our MPs fight for consumers, not for industry,” said Powell.
Low wages and job security lure MPs into second jobs
Not everyone agrees that the underground work of deputies in the investment sector is a problem.
Fairview Investing Director Ben Yearsley said: “Iit is not fashionable to say, but I don’t care if they get a second job as long as they’re doing their main job, which is being a member of Parliament, properly.
Yearsley believes MPs aren’t paid enough, so it’s understandable that they want a second job.
They also have less job security now that Boris Johnson plans to repeal the Fixed-Term Parliament Act, which set a five-year period between ballots and barred the PM from calling a general election as he sees fit.
“Boris could call an election after Christmas or whatever and you could find yourself out of a job after two or three years,” Yearsley says.