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

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Richard Dawkins: We need a new party - the European Party

I was unqualified to vote in the EU referendum. So at least now we should hear from experts. 

It is just conceivable that Brexit will eventually turn out to be a good thing. I gravely doubt it, but I’m not qualified to judge. And that is the point. I wasn’t qualified to vote in the referendum. Nor were you, unless you have a PhD in economics or are an expert in a relevant field such as history. It’s grotesque that David Cameron, with the squalidly parochial aim of silencing the Ukip-leaning wing of his party, gambled away our future and handed it over to a rabble of ignorant voters like me.

I voted – under protest, because I never should have been asked to vote, but I did. In line with the precautionary principle, I knew enough to understand that such a significant, complex and intricate change as Brexit would drive a clumsy bull through hundreds of delicate china shops painstakingly stocked up over decades of European co-operation: financial agreements, manufacturing partnerships, international scholarships, research grants, cultural and edu­cational exchanges.

I voted Remain, too, because, though ­ignorant of the details, I could at least spot that the Leave arguments were visceral, emotional and often downright xenophobic. And I could see that the Remain arguments were predominantly rational and ­evidence-based. They were derided as “Project Fear”, but fear can be rational. The fear of a man stalked by a hungry polar bear is entirely different from the fear of a man who thinks that he has seen a ghost. The trick is to distinguish justified fear from irrational fear. Those who scorned Project Fear made not the slightest attempt to do so.

The single most shocking message conveyed during the referendum campaign was: “Don’t trust experts.” The British people are fed up with them, we were told. You, the voter, are the expert here. Despicable though the sentiment was, it unfortunately was true. Cameron made it true. By his unspeakable folly in calling the referendum, he promoted everyone to the rank of expert. You might as well call a nationwide plebiscite to decide whether Einstein got his algebra right, or let passengers vote on which runway the pilot should land on.

Scientists are experts only in their own limited field. I can’t judge the details of physics papers in the journal Nature, but I know that they’ve been refereed rigorously by experts chosen by an expert editor. Scientists who lie about their research results (and regrettably there are a few) face the likelihood that they’ll be rumbled when their experiments are repeated. In the world of science, faking your data is the cardinal sin. Do so and you’ll be drummed out of the profession without mercy and for ever.

A politician who lies will theoretically get payback at the next election. The trouble with Brexit is that there is no next election. Brexit is for keeps. Everyone now knows that the £350m slogan on the Brexit bus was a barefaced lie, but it’s too late. Even if the liars lose their seats at the next election (and they probably won’t), Brexit still means Brexit, and Brexit is irreversible. Long after the old people who voted Leave are dead and forgotten, the young who couldn’t be bothered to vote and now regret it will be reaping the consequences.

A slender majority of the British people, on one particular day in June last year when the polls had been going up and down like a Yo-Yo, gave their ill-informed and actively misled opinion. They were not asked what they wanted to get into, only what they wanted to get out of. They might have thought “Take back control” meant “Give control back to our sovereign parliament, which will decide the details”. Yes, well, look how that’s working out!

“The British people have spoken” has become an article of zealous faith. Even to suggest that parliament should have a little bitty say in the details is hysterically condemned as heresy, defying “the people”. British politics has become toxic. There is poison in the air. We thought that we had grown out of xenophobic bigotry and nationalistic jingoism. Or, at least, we thought it had been tamed, shamed into shutting its oafish mouth. The Brexit vote signalled an immediate rise in attacks on decent, hard-working Poles and others. Bigots have been handed a new licence. Senior judges who upheld the law were damned as “enemies of the people” and physically threatened.

Am I being elitist? Of course. What’s wrong with that? We want elite surgeons who know their anatomy, elite pilots who know how to fly, elite engineers to build safe bridges, elite athletes to win at the Olympics for Team GB, elite architects to design beautiful buildings, elite teachers and professors to educate the next generation and help them join the elite. In the same way, to decide the affairs of state, as we live in a representative democracy, we can at least hope to elect elite parliamentarians, guided and advised by elite, highly educated civil servants. Not politicians who abdicate their democratic responsibility and hand important decisions over to people like me.

What is to be done? Labour, the so-called opposition, has caved in to the doctrine of “the British people have spoken”. Only the Lib Dems and SNP are left standing. Unfortunately, the Lib Dem brand is tarnished by association with Cameron in the coalition.

Any good PR expert would prescribe a big makeover, a change of name. The “Euro­pean Party” would attract Labour voters and Labour MPs disillusioned with Jeremy Corbyn. The European Party would attract Europhile Tory MPs – and there are plenty of them. The European Party would attract a high proportion of the 48 per cent of us who voted Remain. The European Party would attract big donations. The European Party might not win the next election, but it would stand a better chance than Labour or the Lib Dems under their present name. And it would provide the proper opposition that we so sorely need.

This article first appeared in the 30 March 2017 issue of the New Statesman, Wanted: an opposition