Tories’ £50,000 from fatcats who cashed in on Carillion failure
SCANDAL OVER HEDGE FUND’S ELECTION DONATION
Interests lie with the privileged few, not Carillion employees JON TRICKETT LABOUR MINISTER ON TORY PARTY
THERESA May has been branded a “total hypocrite” for accepting £50,000 from a firm accused of making money off Carillion’s failure.
Naya Capital Management UK, which made the donation to the Tories a week before the general election last June, is one of a string of hedge funds that bet on the company’s share price falling.
The value fell more than two-thirds in July, with Naya reportedly making nearly £8million.
Carillion plunged into insolvency six months later.
Jon Trickett, Labour Shadow Cabinet Office Minister, said: “Theresa May is a total hypocrite.
“Despite promising to crack down on irresponsible businesses, her party is happy to accept cash from those who have pocketed millions of pounds from Carillion’s collapse.
“It shows that, yet again, the Conservatives’ interests lie with the privileged few, and not the thousands of Carillion employees that face losing their jobs.”
A register held by the Financial Conduct Authority states Naya held “short positions” in Carillion between 2015 and July 12, 2017 – two days after the construction giant issued its first profit warning.
Short-selling amounts to betting that a firm’s share price will fall.
The drop in Carillion’s shares happened within days at the start of July.
A Reuters report at the time claimed Naya, founded in 2012 by former Goldman Sachs banker Masroor Siddiqui, made £7.6million.
The London firm made its donation to the Conservative Party on June 1.
Labour said hedge funds or people linked to them donated almost a fifth of the cash the Tories received between the 2015 and 2017 elections.
Hedge funds invest money on behalf of their members, which can include pension funds and charities.
Donors who give £50,000 or more to the Conservative Party have the opportunity to attend private dinners with Theresa May and senior ministers.
A Tory Party spokesman said: “All donations to the Conservative Party are properly and transparently declared to the Electoral Commission, published by them, and comply fully with the law.”
Our revelation came as Mrs May was yesterday accused of negligence over the Carillion fiasco, in a heated clash during Prime Minister’s Questions.
Labour leader Jeremy Corbyn called for private firms to be “shown the door” by the Government, highlighting failures
This isn’t one isolated case of corporate failure and Government negligence JEREMY CORBYN HITTING OUT AT PRIME MINISTER YESTERDAY
by Virgin, Stagecoach, Capita and Atos to deliver on promises to the state.
Slamming contracts given to Carillion despite three profit warnings last year, he said: “This isn’t one isolated case of Government negligence and corporate failure, it’s a broken system.
“Under this Government, Virgin and Stagecoach can spectacularly mismanage the East Coast Main Line and be let off a £2billion payment.
“Capita and Atos can continue to wreck the lives, through damaging disability assessments, of many people and win more Government-funded contracts. These corporations need to be shown the door.”
The Labour leader went on: “We need our public services provided by public employees with a public service ethos.”
Mrs May accused Mr Corbyn of failing to recognise most UK employees worked in the private sector, adding: “We’re a customer of Carillion, not the manager of Carillion.”
The PM also said she had ordered the fast-tracking of an investigation into the collapse of the firm and the conduct of current and former directors.
It emerged Carillion had just £29million in cash by the time it went bust, while struggling under £900million debt and a £587million pension deficit.
The firm’s projects include the HS2 railway, Midland Metropolitan Hospital in Smethwick, near Birmingham, and Royal Liverpool Hospital. Meanwhile, shares in outsourcing giant Interserve initially dived yesterday after it emerged the Cabinet Office was monitoring its finances.
It is understood officials began this after the first of two profit warnings last year. Debts at Interserve, which has numerous public sector contracts, have spiralled to £513million.
The share price later recovered. Neil Wilson, senior market analyst at ETX Capital, said: “It’s no Carillion.”
Naya Capital did not return requests for comment last night.