A Labour MP has written to the government’s most senior official to warn about what he said was the potential for conflicts of interest in Boris Johnson’s government if he implemented proposed policies that could potentially benefit major donors.
Ian Murray – who does not allege any wrongdoing – told Sir Mark Sedwill that with the new government promising rapid change, “it is particularly important that the public have confidence that decisions are being made in their interests and in the proper way”.
His letter pointed to a series of areas of potential focus, including proposed cuts to stamp duty when Johnson received donations of more than £60,000 from property developers during the recent Conservative party leadership campaign.
Murray, a supporter of the People’s Vote campaign, also noted Johnson’s much-touted plans for free ports including Bristol, when the owners of Bristol port gave £25,000 to his campaign; and policies to reform the NHS after he received £10,000 from Richard Girling, a leading UK investor in the private healthcare system.
1: Raising the 40% income tax threshold
Cost: £9bn. Only 12% of people in the UK earn more than £50,000 a year, so this pledge to move the 40% threshold up to £80,000 would help those on the highest incomes.
2. Increasing the starting point for national insurance contributions to £12,500
Cost: £11bn. At present people pay NICs when they earn £166 a week and income tax when they earn £12,500 a year. Johnson wants to gradually align the two systems by raising the NICs ceiling to an annual £12,500.
3. Raise education spending
Cost: £4.6bn. Theresa May’s successor says he will raise education spending to £5,000 for every secondary school pupil and £4,000 for each primary school pupil.
4. More police
Cost: £1.1bn. Johnson has promised an extra 20,000 officers.
5. Free TV licences for the over-75s
Cost: £250m. This would reverse the BBC – and George Osborne’s -decisions over this perk for pensioners.
6. Raising the level at which stamp duty is levied
Cost: £3.8bn. There have been reports that the incoming prime minister would like all house sales under £500,000 in England, Wales and Northern Ireland to be exempt from stamp duty.
7. Nationwide full fibre broadband coverage by 2025
Cost: unknown. Industry experts say this is not feasible in the time available, given coverage is currently less than 10%.
8. The creation of six free ports in the UK
Cost: unknown. Johnson said while on the hustings with Jeremy Hunt that he intended to create “about six” free ports – zones designated by the government to pay little or no tax in an attempt to boost economic activity.
9. Review HS2 and build HS3
Cost: unknown. One of Johnson’s big early decisions will be whether to scrap HS2 and spend the money on alternative rail infrastructure such as linking the big cities of the north through HS3. Any savings generated by scrapping HS2 will almost certainly be recycled into other transport projects.
10. Raising the national living wage
Cost: unknown. The government employs one in six of the people working in the UK, so it would be affected by Johnson’s promise to raise the national living wage.
Larry Elliott Economics editor
The letter highlights one of the principles of the ministerial code, which guides the behaviour of those in government, saying ministers “must ensure that no conflict arises, or could reasonably be perceived to arise, between their public duties and their private interests, financial or otherwise”.
Murray wrote to Sedwill, the cabinet secretary: “I am concerned that the following recent policy announcements made by the new prime minister could be perceived to give rise to conflicts of interest given financial interests he has registered with the House of Commons.”
Johnson has received a total of £62,000 from various property developers and investors, including Jamie Reuben. As London mayor, Johnson faced criticism for approving a £100m development by the family firm co-run by Reuben’s billionaire father, David.
During the leadership campaign it was reported that Johnson planned to raise the threshold for paying stamp duty from £125,000 to £500,000, and cut the top rate – for any price paid above £1.5m – from 12% to 7%, which would reduce the cost of high-end homes.
Murray’s letter also highlighted the appointment of Andrew Griffith, a senior Sky executive, after he lent Johnson his London home to use as an office during the leadership campaign.
It also cited any possible moves to review taxes on high-sugar drinks or tobacco, given that Johnson’s leadership campaign was headed for a period by Mark Fullbrook, who co-runs a firm that lobbies for both industries.
Fullbrook is a partner in lobbyists Crosby Textor Fullbrook Partners (CTFP). The company has said he took leave of absence to head Johnson’s campaign, and had no contact with the company’s clients during this period.
CTFP do not say who they work for in the UK, but emails seen by the Guardian show the company contacted councillors earlier this year on behalf of the tobacco giant Philip Morris to lobby over anti-smoking measures.
Separately, it has emerged that the Australian part of the same lobbying group, Crosby Textor Research Strategies Results, acts for the dairy multinational Parmalat, which produces a major flavoured milk brand that contains more sugar than Coca-Cola.
During the leadership campaign Johnson said he would reconsider a tax introduced last year on high-sugar drinks. Among his other tasks will be to follow up on a government consultation on new measures to curb tobacco use, including the possibility of cigarette firms being forced to pay for schemes.
Murray wrote to Sedwill: “The surest way for the prime minister to avoid any appearance of a conflict of interest on these issues is for him to now recuse himself from any discussion of policymaking on these topics.
“I would be very grateful if you could remind the prime minister of his obligations under the ministerial code, and encourage him to recuse himself in this way to maintain public confidence in the government’s policymaking process.”
Downing Street was contacted for comment.
