Exclusive:MP’s business will no longer be paid by lobbyist to chair pressure group after calls for second job rules ‘rewrite’

Transparency campaigners have called for a “drastic rewrite” of the rules governing MPs’ conduct, as it’s emerged that a lobbyist representing several clients facing investigations by the competitions watchdog is funding a pressure group of MPs pushing for reform of the regulator.

WPI Strategy has been paying a business co-owned by Conservative MP Bim Afolami £2,000 a month. Afolami told NationalWorld that he will no longer receive payment for the role, following criticism of the arrangement.

WPI also helps run the Regulatory Reform Group (RRG), which recently submitted a report to the government calling for changes to the UK’s regulators, while members of the group have urged reform in Parliament.

Among WPI’s listed clients are two firms set to face intense regulatory scrutiny from the Competitions and Markets Authority (CMA), potentially impacting on upcoming multi-billion pound mergers.

The links between WPI, Afolami and the RRG

Afolami began chairing the group in January this year. Warre Constable LLP - a family business co-owned with his wife - started receiving payments of £2,000 from WPI at the end of February, for 15 hours of work per month.

The MP for Hitchin and Harpenden registered two payments from WPI to the firm on 28 February and 30 March, and the latest register of members’ financial interests states that from 31 March, Warre Constable LLP will receive £2,000 per month to chair the group. This was registered on 2 May.

Contacted by NationalWorld about concerns raised by transparency campaigners over the arrangement between the RRG, Afolami and WPI, Afolami said his position as Chair of the RRG “has already ceased to be a paid role in any respect”.

He added: “This will be reflected in the next published register of interests”.

WPI will still provide so-called ‘secretariat services’ for the group, effectively funding its operations, with an in-kind donation of £7,500 to cover the year. One of WPI’s lobbying clients, Pension Insurance Corporation, provided in-kind support valued at £2,500 toward the production of a report by the RRG which was recently submitted to the government.

The report was welcomed by Treasury Minister Andrew Griffith, who described it as “timely”, adding that it “sets out the opportunities from getting regulatory systems right”.

He said: “The authors rightly remind us that for the economy to succeed, wider culture needs to acknowledge that risk has to be sensibly managed rather than avoided”.

'The MPs’ Code of Conduct needs another drastic rewrite'

Campaigners have expressed concern and confusion about the arrangement between WPI and the RRG, as they say it runs counter to the spirit of the rules for MPs around lobbying and paid advocacy.

Tom Brake, director of standards campaign group Unlock Democracy, said: "I struggle to get my head round this. [Mr Afolami’s business] receives in-kind support from consultant lobbyists WPI Strategy, for secretariat services for the Regulatory Reform Group which Mr Afolami chairs. The RRG submits a report to the government, presumably with a view to influencing government on the subject of regulatory reform, a matter of interest to at least some of WPI Strategy’s clients. Yet this isn't lobbying”.

“This is even more confusing when the Code of Conduct for MPs makes it clear that MPs may not make approaches to Ministers, in return for payment [cash or in kind]. If this is all in order, the MPs’ Code of Conduct needs another drastic rewrite”.

Rose Whiffen, Senior Research Officer at Transparency International UK, said: "Members of Parliament should not accept cash that may appear to be in exchange for lobbying and should be wary of being paid to participate in groups in a manner that could circumvent lobbying rules. It seems that despite recent changes, the restrictions on MPs' second jobs are still not tight enough”.

Afolami, who told NationalWorld that “no lobbying of any kind has taken place nor has any rule been broken,” has written to the Prime Minister about the group’s activities and has mentioned the RRG several times in Parliament while speaking in debates relating to regulatory matters, particularly on the CMA, which investigates mergers between companies that could see competition reduced. Another of the RRG’s members - the crossbench peer Lord Tyrie - chaired the CMA between June 2018 and September 2020.

The regulator recently blocked a large merger between the video game giants Microsoft and Activision Blizzard over concerns that the move would stifle innovation and lead to less choice for consumers. WPI previously acted on behalf of Microsoft in a separate capacity - producing a report on the benefits of technology in reducing “regional inequalities in health and social care” in the UK.

More CMA investigations ahead

However, NationalWorld can reveal that at least two of WPI’s current lobbying clients are facing CMA investigations of their own, which could disrupt planned merger acquisitions worth tens of billions.

In March, the CMA referred the anticipated $61 billion acquisition of cloud computing firm VMware by US chipmaker Broadcom for further investigation, over concerns that the merger could make computer servers more expensive. VMware is a lobbying client of WPI strategy.

Vodafone, another client of WPI, is in the process of a £15 billion merger with Three, which is likely to face significant scrutiny from the CMA over the impact on consumer prices. In addition, trade unions have raised concerns about likely job losses which would result from the merger.

WPI Strategy, Vodafone and VMware did not respond to NationalWorld’s requests for comment.