Private sector lobbyists embedded into Labour’s shadow cabinet teams

More than a dozen private sector lobbyists and consultants have been embedded in the shadow cabinet teams, after Labour approached businesses for help with shaping its policies.

The party is understood to have sent out an appeal to private companies to send staff to assist it with policy work, particularly in complex areas such as artificial intelligence (AI).

One of the firms, Faculty AI, told staff in an internal memo, leaked to the Guardian, that Labour had called on it for expertise, and that it had amended its ethical policies to allow for a staff member to work with the party for one to two days a week.

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Other firms to send staff include FGS Global, whose clients include the Czech billionaire bidding for Royal Mail, Daniel Křetínský. The PR and lobbying firm has a member of staff seconded to the office of Rachel Reeves, the shadow chancellor.

Reeves’ deputy, Darren Jones, has also taken on an employee from Baringa, a management consultancy that specialises in central government efficiency savings, and Arup, an engineering firm. Both the people seconded from the private sector have been given parliamentary passes, allowing them access to the Westminster estate.

The move to embrace secondments opens Labour up to criticism that its policies may be influenced by private sector interests. Momentum, the leftwing campaign group, said: “The role of lobbyists operating as secondees drafting policy poses major questions about conflicts of interest distorting the priorities of an incoming Labour government. The shadow cabinet must ensure policy is based on real Labour values and democratic processes rather than big businesses buying improper influence.”

However, the party said: “The Labour Party is serious about growing our economy and seizing the opportunities in the technology and financial sectors after 14 years of Tory chaos, decline and wasted opportunity,” a spokesperson said. “We have standard secondment agreements which have been declared transparently in the usual manner.” It is understood not all the secondees are working on policy.

Faculty AI has a staff member working in the office of Peter Kyle, the shadow science and technology secretary. The firm is known for its work for the Vote Leave campaign when it was hired by Dominic Cummings during the Brexit referendum, for which it was paid £114,000. It was also given a coronavirus-related contract to collect and analyse the tweets of UK citizens during the pandemic, alarming privacy campaigners who said it amounted to mass surveillance.

After Faculty’s prominence in the Brexit campaign, it made a rule that the company “doesn’t do party politics” but this has now been amended to allow it to help Labour with policy work related to AI. Its new rule reads: “We don’t do party politics (but will help with AI policy)”.

A leaked memo from Faculty shows it justified the decision to send a staff member to work for Labour to its employees, saying: “Labour requested a Faculty secondee to help them shape their AI policy as part of their programme for government. This is to help them if they are elected, not to help them get elected.

“Large management consultancies often help governments-in-waiting prepare for power, but for Labour to want to work with a firm of our size is a coup, and testament to our people and quality of work.

“The work is already under way, with [redacted] working with Labour 1-2 days per week. He could be there until the election, and will draw on wider expertise across Faculty where needed. The work is strictly about policy development only. However, the work could contravene an (unintended) literal reading of our ethical principle ‘We don’t do party politics’ as previously drafted.”

Another person, seconded from Global Counsel, the advisory and lobbying firm founded by Peter Mandelson, has worked for Tulip Siddiq, a member of the shadow Treasury team.

A string of seconded staff also come from the thinktank Labour Together, which is funded by the donors Trevor Chinn and Martin Taylor who are both high-profile financiers.

The Guardian reported last year that a HSBC employee was seconded to the shadow business team working for Jonathan Reynolds, despite the financial firm coming in for criticism over its links with China.

Graeme Swan, a partner at Baringa, said there had been a “general request from Labour to the management consultancy market for support, and we responded”.

He added: “Baringa working on the project is making, we hope, good sense for the project’s outcomes. We have knowledge that political parties will find useful and we were also able to talk to a wide range of other companies and seek their views, therefore hopefully making the eventual policies better.

“Meanwhile, it made good business sense for us because it gave us access to a broad range of thinking from all the sources Labour were using – so, as well as passing on information, we learned a lot too.”

An Arup spokesperson said: “We offer guidance to all major UK political parties, sharing knowledge and best practice that will help address complex challenges like achieving net zero goals and constructing sustainable infrastructure.”

• The Scott Trust, through its investment in Mercuri, owns a minority stake in Faculty.