Labour has been criticised for giving global banks access to parliament after taking an HSBC staffer into its shadow business team, despite the financial giant coming under fire over its links with China.
One senior policy manager from HSBC has been seconded to the team of Jonathan Reynolds, the shadow business secretary, and has been given a parliamentary pass since February.
The HSBC staff member works part time in Reynolds’s team to help with stakeholder engagement – liaising with businesses – as well as working part time for the bank.
The secondment has not been declared on his MPs’ register of interests because the HSBC employee’s time is understood to be a donation in kind to the party, rather than him personally.
It comes after Reynolds previously gave a secondment to a NatWest staffer to help with business liaison and took another secondee from a lobbying firm last year.
Labour has been working hard to show it is open to working more constructively with business under Keir Starmer after relations were strained in the Jeremy Corbyn era.
Its business day at the Labour party conference was oversubscribed in 2022, with firms and lobbying companies increasingly giving the party attention because it is so far ahead in the polls. In relation to the secondments, it is understood that Labour insists on strict separation between work for the party and work for the employer during a placement.
However, the presence of an HSBC policy expert at the heart of the shadow business team was criticised by pressure groups and critics of the bank’s closeness to the Chinese government and treatment of those leaving Hong Kong.
Tom Brake, director of Unlock Democracy, a campaign group pressing for a more democratic society, said: “Political parties should tread very carefully when inviting business secondees into the heart of their teams: firstly because those businesses will have their own agenda and priorities, and secondly because of the reputational risk of making the wrong choice.
“Picking HSBC as a partner, which attracted much criticism over its stance on Hong Kong, is a questionable decision.”
One critic of HSBC on China, Sir Iain Duncan Smith, the former Conservative leader, added: “HSBC’s record on China is appalling, freezing the pensions of British nationals overseas who left Hong Kong, having been told by China. You do begin to wonder if Labour feel secure in having HSBC sitting on their shoulder.”
Momentum, the leftwing pressure group within the Labour party, criticised the secondment on the grounds that a representative of the banking industry working within a Labour team was “frankly alarming”.
A spokesperson for the group said: “For Labour to be in bed with banks like HSBC at any time represents a worrying capitulation to corporate interests. For this news to emerge weeks after HSBC announced that it had doubled its quarterly profits to £4.3bn is even more galling. While millions struggle to make ends meet in a cost of living crisis, Labour is working hand in glove with profiteering bankers.
“The Labour leadership’s cosying up to the City of London isn’t just out of touch with the public mood. It risks the party embracing another disastrous round of deregulation in the name of freeing up private financing. Instead, Labour should be laying out a plan to tax bankers’ windfall profits, rein in bonuses and put our financial system to the work of people and planet.”
Labour party donations are increasingly coming from businesses as well as traditional trade union donors, with the help of Lord Levy, Tony Blair’s former fundraiser. Trevor Chinn, a financier and businessman, and Victor Blank, the former chairman of Lloyds Banking Group, who both donated during the New Labour and Miliband eras, have returned to giving money since Starmer became leader. The party also this year accepted £250,000 from Fran Perrin, daughter of Lord Sainsbury, who is part of the supermarket dynasty.
An HSBC spokesperson said: “HSBC maintains a politically neutral position. We regularly engage with a range of policymakers on issues affecting our customers.”
The bank has previously said on the controversy over its position on Hong Kong that it has “an enduring commitment to Hong Kong, its people and communities” but that “like all banks, we have to obey the law, and the instructions of the regulators, in every territory – including Hong Kong – in which we operate.”
NatWest had no comment.
