Boris Johnson has hugged Barclays too close

The Mayor of London's links with the bank risk damaging reputations in London.

The news today that Barclays have been hit with huge fines for their involvement in the interest rate fixing scandal will have caused great anxiety at City Hall.

While no senior politician can claim to have kept the bank at arms length, there is no politician who has hugged them closer than Boris Johnson. In fact, even before he was first elected Mayor of London, Boris was determined to bring Barclays and boss Bob Diamond into his court.

Asked in April 2008 why he hadn’t named any of his advisers yet, Boris quickly revealed that Diamond was top of his list. Speaking to LBC radio, Johnson said he was “delighted” that Bob would head his new mayoral charity explaining that Diamond was “an extremely wealthy man, and I know how much money they make at Barclays because they rip me off with their charges the whole time."

Diamond and other City big-wigs were singed up to an elite “London Business Club” where the mayor extracted large donations over plates of poached eggs and smoked salmon.

According to one report: “The newly refurbished Savoy played host to the likes of ITIS and Streetcar chairman Sir Trevor Chinn, Goldman Sachs head of economics Jim O’Neill and former chief economist and deputy chairman of Man Group Stanley Fink. They were rubbing shoulders along the breakfast table with incoming Barclays chief executive Bob Diamond, who flipped open his chequebook to deliver a £50,000 donation over the meal.” Boris would later welcome a further £1m in charitable donations from the bank.

Such generosity comes at a price and Boris has since taken to the Telegraph to dismiss attacks on the banking industry as “neosocialist claptrap” and told Londoners to stop “whingeing” about house prices pushed up by city bonuses.

He claimed that a tax on banker bonuses would force thousands to flee the country and campaigned relentlessly for the Conservative government to cut the top rate of tax. While every other politician in Britain was desperate to distance themselves from the bankers, Boris - under the advice of his policy chief Anthony Browne - just hugged them closer. Browne has since gone on to become the head of the British Bankers Association.

When Boris announced that he was launching a central London bike hire scheme it was only natural that Diamond’s bank would be approached.

Boris failed to finance the bikes through advertising like other European schemes. In fact despite promising the bikes “at no cost to the taxpayer” (pdf), Boris’s Barclays Bikes have since cost taxpayers £120m with only “up to” £50m set to come back from the bank. Later one City Hall source told the Standard that the Barclays deal amounted to “payback” for Boris’s support during the financial crisis.

Full details of this payback have never been fully revealed, with City Hall claiming commercial confidentiality on the deal. However a London Assembly investigation into the agreement warned that Boris had risked damaging TfL’s own brand if Barclays later “suffered major reputational damage”.

With calls today for a criminal investigation into the bank, that fear has now been dramatically realised. And in typical style Boris was quick today to insist that “the whole banking industry” should come clean over the scandal.

Whether or not this will be enough to stem criticism of his own relationship with the bank remains to be seen. But with his mayoralty so visibly tied to Barclays and its senior management, Boris will now hope that other banks absorb some of that reputational damage fast.

 

Boris Johnson poses during the launch of the London Cycle Hire bicycle scheme in 2010. Photograph: Getty Images

Adam Bienkov is a blogger and journalist covering London politics and the Mayoralty. He blogs mostly at AdamBienkov.com

Photo: Paul Sweeney
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Glasgow North East Labour MP Paul Sweeney: “Yes badges were cool in 2014 – now it's Jeremy”

The son of a shipbuilder harnessed the Corbyn surge to win over pro-Scottish independence voters.

In 2014, on the eve of the Scottish independence referendum, a young BAE graduate called Paul Sweeney introduced Gordon Brown.  He was there because of a referendum that “sent you into a black hole and spat you back out”, as he puts it. In his case, this started with a letter warning of the impact of independence on the shipbuilding industry, which led to a photoshoot, an appearance on the 6 o’clock news, and eventually the warm-up act for a former Prime Minister.

“Glasgow did feel like the ground was moving under your feet,” Sweeney says.  “It was exhilarating, terrifying.” But unlike Sweeney, most young Glaswegians were swept up in the independence movement, and the north east of the city where he lived was one of the strongest areas for Yes.

Brown’s speech was widely acclaimed for saving the union. But in Glasgow, voters were disappointed, and in the general election, Labour campaigners “were really told where to go”. Glasgow North East, a traditional Labour seat, fell to the Scottish National Party.

And yet, just two years and a snap election later, Sweeney is sitting in Westminster’s Portcullis House, as the constituency’s new Labour MP. How?

“From a very young age, I sensed an area that had fallen from a previous glory”

Sweeney, a fresh-faced 28, was ambitious for his constituency from a young age. “I was brought up in a Labour family – a working class family – in the north of Glasgow,” he tells me. “From a very young age, I sensed an area that had fallen from a previous glory.”

His mother, who worked in the Bank of Scotland, grew up in Milton, a housing scheme in northern Glasgow. “My mum used to talk about how it was a lovely area and lots of families there.” But by the time he was a child, drug abuse was on the increase, and “despair crept in”. Visiting his grandmother had to be done on foot: “You couldn’t drive a car in there because it would be vandalised.”

Sweeney’s father was a shipbuilder. In the 1990s, as shipyards fell silent, he was made redundant several times. “I remember getting up to see him off going to Barrow-in-Furness [in Cumbria],” Sweeney says. “I remember not getting much for Christmas because money was tight.” His father eventually became a taxi driver.

Sweeney, though, increasingly felt compelled to fight the decline. He studied politics and economics at Glasgow University and enrolled in the Territorial Army, before graduating and joining the defence giant BAE. In 2015, he moved to Scotland’s economic development agency, Scottish Enterprise.

At the same time, he joined Labour, inspired by the late John Smith, whom his parents called “the greatest leader my country never had”.  In 2009, he was doing his exams, when Sarah Brown, wife to then-prime minister Gordon Brown, called and asked him if he wanted to help Labour’s candidate Willie Bain in the Glasgow North East by-election.

Sweeney joined a team that included Kezia Dugdale, the future Scottish Labour leader. The Tory candidate was one Ruth Davidson. He recently reminisced with Dugdale about the by-election: “We were saying who would have thought all these changes would have happened in a relatively short period of time.

The Yes badges were the cool thing to have – now it was Jeremy

Bain won, but was swept from office by the SNP’s Anne McLaughlin in 2015 in such an upset that Sweeney started his 2017 campaign only hoping to reduce her 9,222 majority. With little funding, he relied on a team of young volunteers to design leaflets and door-knock.

Then something changed. Was it the Corbyn surge? “Absolutely – without a shadow of a doubt,” he replies.

Initially sceptical of Jeremy Corbyn, Sweeney believes his “vision of hope” revived Labour’s fortunes. In Dennistoun, a hipster neighbourhood known for its SNP and Green vote, all the posters in the windows were Labour ones. “It was sexy again,” he says. “The Yes badges were the cool thing to have on your school bag. Now it was Jeremy.”

One day, a group of young men began shouting at the canvassing team. “We thought, ‘Here we go,’ then it actually turned out they were shouting ‘C’mon the Jez, let’s get Jeremy in.’ It was people who you wouldn’t normally think would vote. I thought that was fantastic.”

All the same, Sweeney didn’t bother drafting a victory speech. He describes the count as “like you are flying through the air”.  When he knew he had won, his first thought was: “Oh, shit, I need to do an acceptance speech."

One of my best friends was killed in Afghanistan

Now safely landed in Westminster, Sweeney hopes to draw on his experience in industry and the military. The latter has taught him caution, not jingoism.

“One of my best friends was killed in Afghanistan,” he says. “It was a terrible time. It was just unbelievable. He went there because he wanted an experience. He wasn’t in the army as such – he was captain of the Scottish Lacrosse team.

“It does lead you to ask, ‘What are we doing? What is the meaning behind this? The intent is noble but there is a certain amount of ignorance about what needs to be done to achieve the political outcome.”

Afghanistan’s troubled Helmand Province, he points out, is the size of Wales: “We are trying to control it with 8,000 people.”

On Trident, an issue that traditionally divides Labour’s pacifists from its hawks, Sweeney’s view is also nuanced. “Trident actually saps services from other ship building industries,” he says. “There was a huge investment on the Clyde and money has to be diverted now. It is robbing Peter to pay Paul.”

Sweeney calls himself “restless” for change. He hates “energy vampires”, as he calls those that stand in the way. But while the spectre of economic neglect has clearly driven his career, he is also excited about ideas of nationalisation and regeneration.

“My family are steeped in the Clyde ship building,” he says. “Sitting on your dad’s shoulders watching these ships being launched – it is an extraordinary achievement.

“You can understand why it was so emotional when the ship building declined. It was part of their identity. These are the largest objects made by man. It is incredible to behold.”

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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