Finance bosses choose Labour as election draws closer
Published: 02:06 PM,Jun 25,2024 | EDITED : 06:06 PM,Jun 25,2024
Several top financial services figures have strongly backed the Labour Party while campaigning for the UK general election gathered force. Electoral commission records and conversations with donors show that efforts by the traditionally left-wing party to rebrand itself as the party of business are bearing fruit.
Founder of legal search firm SSQ, Gareth Quarry, said that he and his wife have made “four or five donations to Labour since the election was called, with the total now at about £350,000. He previously supported the Conservatives. But after former prime minister Boris Johnson had spoken about his total disregard toward business, the historic party of business “then couldn’t give a monkey’s”, Quarry said.
“The Tories have at every step of the way gone about creating havoc, creating uncertainty and putting me as a business owner on the back foot. I got to know a number of Labour Party shadow front bench and realised how impressive and sensible and prudent they were and with a real will and ambition for change.” Matthew Oakeshott, whose career in the financial district of London – known as ‘the City’ – has spanned Warburg and his own real estate investor Olim Property, said he was helping to fund Labour, Liberal Democrat and Green Party candidates. “I’ve never been a Conservative, but I feel more comfortable now with Labour,” he said. “Rachel Reeves (shadow chancellor) I have a high opinion of and have known for many years.” As Labour has fostered closer ties with the City, other financiers have given money in the first quarter of 2024, including retired hedge fund boss Martin Taylor and Gibson Dunn partner Charlie Falconer. Environmental entrepreneur Dale Vince told the Financial Times earlier this month that he had topped up his donations to Labour by £1m the day after the election was called, taking his total to £5m.
Some City figures have stayed with the Tories. Michael Spencer, the founder of electronic markets and post-trade business NEX Group, which he sold in 2018, said: “You may well have read in the press that very recently I gave £250,000 to the Conservative Party towards the election campaign. Furthermore, I have made very many smaller donations to individual MPs.” Healthcare software tycoon Frank Hester gave £150,000 to the Conservatives on 8 March, adding to the £5m he donated in January. Lord Michael Hintze, founder of asset manager CQS, donated £50,000 to the Conservatives.
According to TheCityUK, the financial services sector’s trade body, the next government should scrap the bank levy and surcharge tax to address “uncompetitive” rates on UK lenders. The taxes, introduced after the 2008 financial crisis, “are key elements of the UK’s internationally uncompetitive total tax rate for banks” and should be phased out. TheCityUK wrote in its election manifesto, published on 7 June.
The levy targets balance sheet liability and equity. Short-term liability are taxed at 0.1pc and long-term liabilities at 0.05pc. The Office for Budget Responsibility estimates that the bank levy will raise £1.4bn for the 2024 fiscal year. The surcharge, a tax on bank profits, was cut from 8pc to 3pc in April 2023. The surcharge reduction is set to cost the exchequer £1bn a year by the 2026 fiscal year.
The financial services sector pays more corporation tax than any other sector and is the largest net exporting industry, TheCityUK wrote in its manifesto. Chief executive of TheCityUK, Miles Celic, said: “Financial and related professional services are the pulse of the UK economy. The industry is a major national employer, supports people at every stage of their life, and is an enabler of cross-economy growth.
“We want to see a new era of policy certainty and collaboration between government and industry to ensure it can make an even greater contribution to driving investment, innovation, and growth across the country,” he added.
Founder of legal search firm SSQ, Gareth Quarry, said that he and his wife have made “four or five donations to Labour since the election was called, with the total now at about £350,000. He previously supported the Conservatives. But after former prime minister Boris Johnson had spoken about his total disregard toward business, the historic party of business “then couldn’t give a monkey’s”, Quarry said.
“The Tories have at every step of the way gone about creating havoc, creating uncertainty and putting me as a business owner on the back foot. I got to know a number of Labour Party shadow front bench and realised how impressive and sensible and prudent they were and with a real will and ambition for change.” Matthew Oakeshott, whose career in the financial district of London – known as ‘the City’ – has spanned Warburg and his own real estate investor Olim Property, said he was helping to fund Labour, Liberal Democrat and Green Party candidates. “I’ve never been a Conservative, but I feel more comfortable now with Labour,” he said. “Rachel Reeves (shadow chancellor) I have a high opinion of and have known for many years.” As Labour has fostered closer ties with the City, other financiers have given money in the first quarter of 2024, including retired hedge fund boss Martin Taylor and Gibson Dunn partner Charlie Falconer. Environmental entrepreneur Dale Vince told the Financial Times earlier this month that he had topped up his donations to Labour by £1m the day after the election was called, taking his total to £5m.
Some City figures have stayed with the Tories. Michael Spencer, the founder of electronic markets and post-trade business NEX Group, which he sold in 2018, said: “You may well have read in the press that very recently I gave £250,000 to the Conservative Party towards the election campaign. Furthermore, I have made very many smaller donations to individual MPs.” Healthcare software tycoon Frank Hester gave £150,000 to the Conservatives on 8 March, adding to the £5m he donated in January. Lord Michael Hintze, founder of asset manager CQS, donated £50,000 to the Conservatives.
According to TheCityUK, the financial services sector’s trade body, the next government should scrap the bank levy and surcharge tax to address “uncompetitive” rates on UK lenders. The taxes, introduced after the 2008 financial crisis, “are key elements of the UK’s internationally uncompetitive total tax rate for banks” and should be phased out. TheCityUK wrote in its election manifesto, published on 7 June.
The levy targets balance sheet liability and equity. Short-term liability are taxed at 0.1pc and long-term liabilities at 0.05pc. The Office for Budget Responsibility estimates that the bank levy will raise £1.4bn for the 2024 fiscal year. The surcharge, a tax on bank profits, was cut from 8pc to 3pc in April 2023. The surcharge reduction is set to cost the exchequer £1bn a year by the 2026 fiscal year.
The financial services sector pays more corporation tax than any other sector and is the largest net exporting industry, TheCityUK wrote in its manifesto. Chief executive of TheCityUK, Miles Celic, said: “Financial and related professional services are the pulse of the UK economy. The industry is a major national employer, supports people at every stage of their life, and is an enabler of cross-economy growth.
“We want to see a new era of policy certainty and collaboration between government and industry to ensure it can make an even greater contribution to driving investment, innovation, and growth across the country,” he added.