Original article by Ethan Shone republished from OpenDemocracy under a Creative Commons Attribution-NonCommercial 4.0 International licence. 

Labour top brass including Keir Starmer gave Bloomberg ‘exclusive’ look at party’s financial plan at private meeting

Labour leader Keir Starmer, shadow chancellor Rachel Reeves, and four other senior party figures met with a major media and financial information conglomerate weeks after it donated £150,000 to the party – sparking concerns of “cash for access” from transparency campaigners.

The meeting between Labour and the Bloomberg group, which took place in Edinburgh on 8 December last year, was described as “suspicious” and “highly unusual” by two Labour sources.

The private roundtable event came shortly after the US business conglomerate, majority owned by American businessman and politician Michael Bloomberg, made its first donation to Labour in seven years. The donation was made by a Bloomberg subsidiary called Bloomberg Trading Facility Limited.

The party used the meeting to offer Bloomberg and others in attendance “an exclusive dive” into its flagship financial services policy document, which was published the following month, according to a social media post by a person involved in coordinating the event.

Labour did not deny that the meeting was connected to the donation, with a spokesperson telling openDemocracy: “It is standard practice for the Labour Party to meet with the private sector.” The party did not reply to openDemocracy’s query about whether Bloomberg was given exclusive access to the flagship financial services policy document. Bloomberg declined to comment for this story.

The Edinburgh event was facilitated by Sovereign Strategy, a lobbying firm that has represented Bloomberg for almost two decades, which promises to get its clients’ “messages heard at the highest levels of government”, according to the firm’s website.

Lobbyists often hold such events to introduce their clients to Labour frontbenchers so they can try to shape the party’s policy on issues relevant to their businesses.

But two Labour sources, who spoke to openDemocracy on the condition of anonymity to avoid retaliation for appearing critical of the party’s leadership, said the Edinburgh meeting was “highly unusual” and “suspicious” due to the sheer number of senior politicians present.

Starmer and Reeves were joined at the event by shadow business secretary Jonathan Reynolds, shadow City minister Tulip Siddiq, as well as Scottish Labour leader Anas Sarwar and Daniel Johnson MSP, the party’s business spokesperson in Holyrood.

Other comparable meetings are typically attended by only one or two shadow ministers. openDemocracy has analysed more than 200 meetings attended by Labour frontbenchers in the past year based on publicly available data and triangulation through multiple sources, and found the Edinburgh meeting involved far more senior figures than any other.

The meeting took place less than two weeks after Bloomberg Trading Facility Ltd, a subsidiary of Bloomberg LP, donated £150,000 to Labour – with the conglomerate becoming one of the party’s top corporate donors for all of 2023 in a single day, according to Electoral Commission records.

A Bloomberg company last made a cash donation to the Labour Party in late 2016, when it gave the party £60,000. The firm has since handed the Conservatives £260,000, most recently donating £100,000 in June 2022.

Simon Youel, the head of policy and advocacy at not-for-profit advocacy group Positive Money, told openDemocracy that voters should be worried by the timing of the meeting – which took place as Labour finalised a key document to set out its policy on the financial services sector.

“What is most concerning is that weeks after this meeting, Labour published a plan for financial services that reads like a love letter to Big Finance, with much in there that could have been written by the industry itself,” Youel said.

Labour spent months drafting its financial services report, bringing in a staffer from City consultancy Oliver Wyman to put it together. After its publication in January, Reeves and Siddiq threw a lavish, no-press-allowed reception in the City of London’s famed Guildhall to thank the industry for its contributions.

In a since-deleted LinkedIn post, a Sovereign Strategy staffer said the roundtable discussion had a focus on the “outlook for the financial services industry and an exclusive dive into Labour’s launch of the financial services review”.

Youel added: “Rachel Reeves herself has acknowledged New Labour’s errors in relying on an under-regulated financial sector to generate wealth, yet the party seems set on repeating the mistake of letting the City of London dictate policy-making, which inevitably the public will again be left paying the price for.”

In a video from the event, Starmer can be heard telling the attendees: “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 video, which Labour released on the day of the meeting, made no reference to who was at the event or what was discussed.

Bloomberg holds a unique position within the financial sector, providing hardware, software, data and advisory services to all manner of financial services institutions.

Its computer systems, Bloomberg Terminals, are used by banks, institutional investors and financial analysts all over the world to access high-level investment data and place financial transactions. The company also has a news division and TV channel that employ over 2700 journalists in 120 countries, according to its website. Its eponymous billionaire founder and majority owner, Michael Bloomberg, is a fixture in US politics and one of the richest people in the world. He was mayor of New York City for 12 years, before running for President as recently as 2020.

Youel said that access to frontbench politicians could give Bloomberg a “value-add” for its clients, raising “serious concerns around cash for access in our democracy”.

The roundtable was also attended by investment manager Baillie Gifford, Aegon Asset Management and NatWest Group. For several months in 2022, NatWest provided a member of staff to Jonathan Reynolds’ office, valued at £13,800.

A Labour Party spokesperson said: “Donations from corporate entities are declared in line with Electoral Commission rules. Labour is proud to engage with the financial services sector as we develop policies to grow our economy after 14 years of Tory chaos and decline.”

Scottish Labour refused to provide any additional details about the meeting, with a spokesperson saying only that the party “meets with a range of stakeholders to discuss a range of issues”.

They added: “Boosting economic growth is at the heart of our plans to deliver a fairer and more prosperous Scotland, and we are working in partnership with both businesses and trade unions to deliver that.”

Partnership with business
Lobbyist Sovereign Strategy has in recent months strengthened its links to the Labour Party, which is widely expected to win this year’s general election.

Keir Starmer is featured in a brochure published by the lobbying firm in September 2022. The Labour leader is pictured posing for a photo alongside Sovereign chairman Alan Donnelly, a former Labour MEP, in front of a display bearing Bloomberg’s branding.

The brochure goes on to quote a senior Bloomberg executive as saying that the firm has “expanded our influence with key decision-makers”.

Sovereign Strategy also donated £5,000 to deputy leader Angela Rayner “for campaigning activities” last month, according to the register of members’ financial interests. Just over a week after the donation from Sovereign to Rayner, Starmer met with Mike Bloomberg, the billionaire co-founder of Bloomberg, to discuss “Labour’s partnership with business”, .

This donation appears to be a breach of the Public Affairs Code set out by the Public Relations and Communications Association (PRCA), a trade body representing UK lobbyists including Sovereign Strategy. A breach of the code could result in a member being reprimanded or their membership of the organisation being suspended.

Section 8 of the code – a set of rules on the proper lobbying of governments – states that PRCA members must not “make any award of payment in money or in kind… to any MP”. There is no suggestion of wrongdoing on Rayner’s part.

A spokesperson for Sovereign told openDemocracy the donation was made by the company’s chairman in a personal capacity, but was unwilling to provide any further details. A Labour source, however, confirmed the donation was from the company and made by its company bank account.

The PRCA said it was reviewing the information openDemocracy provided.

In January this year, a senior account manager at Sovereign who was involved in organising the Edinburgh roundtable joined the executive committee of Labour Business, an affiliate of the party that focuses on fostering links between Labour and the business community, in January.

The Sovereign staffer in question previously worked for the Labour Party for a number of years in the business relations and endorsements team.

They are one of a large number of former Labour staffers to have left their positions at the party to join Westminster consultancies and lobbying firms the past 18 months, as firms look to beef-up their Labour bona fides in anticipation of a Conservative wipeout at the next election.

Steve Goodrich, the head of research and investigations at Transparency International UK, told openDemocracy: “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.

“Until we reduce the cost of politics, cases like these will continue to undermine public trust in our democracy, which is already perilously low.”

Original article by Ethan Shone republished from OpenDemocracy under a Creative Commons Attribution-NonCommercial 4.0 International licence. 

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