George Osborne has been accused of dragging the reputation of politicians “deeper into the gutter” by trading his insider knowledge of government to Donald Trump’s favourite investment firm – and pulling in the highest-ever earnings of a sitting MP.
As his successor Chancellor Philip Hammond delivered the government’s latest austerity budget on Wednesday, the register of MPs’ interests was published – and the full details emerged of Osborne’s lucrative new contract with US money manager BlackRock which will see him collect at least £650,000 a year for just one day’s work a week.
Osborne’s £13,500-a-day earnings at BlackRock may be substantial, but they are a piffling amount for a firm which makes more than $13m (£10.7m) profit each day, advising clients including President Trump, who has praised BlackRock for “great returns”.
But Osborne’s huge pay packet is not his only income. Over the past six months the former chancellor pocketed almost £800,000 for 15 speeches, some of which caused him to miss a series of crucial votes in parliament, including on Brexit – although he was paired with an opposition MP who was also unable to make the vote so that his absence did not affect the outcome.
He also collects a £120,000-a-year “stipend” from a US Republican thinktank, and received an estimated £100,000 advance for his forthcoming book Age of Unreason which explores the rise of “populist nationalism”. Then there is an annual dividend of £44,000 from his family’s upmarket wallpaper business, Osborne & Little – and it is all on top of his £75,000 salary as the Right Honourable member for Tatton.
Andrew Gwynne, shadow Cabinet Office minister, said it was outrageous that Osborne’s annual pay from his one-day a week job is more than many of his constituents “will see in their lifetime, [and] all whilst still claiming his full salary as an MP”.
“It is an outrage that whilst the country was listening to the chancellor sentencing us to austerity until at least 2025 – Osborne was banking almost £1m trading in his experience as a failed former chancellor and failed EU negotiator. .
“Claims from this government that they represent working people, shows how detached from reality they are.”
Osborne’s post-chancellorship fortune will be boosted further by bonuses he expects to be granted by BlackRock. His final take will depend on how much profit the world’s largest fund manager makes. The firm, which manages more than $5tn worth of investors’ money including “a lot of” Trump’s fortune, made profits of $4.6bn last year.
BlackRock declined to specify how Osborne’s bonus and share awards will be calculated – but they may well be big. Last year, BlackRock’s chief executive, Larry Fink, collected a bonus worth 2,766% times his basic pay, taking his total yearly earnings to £25.8m.
While he was in office, Osborne met with BlackRock bosses five times, and members of his team at No 11 met with the firm 22 times in his last two years at the Treasury. His former righthand man, Rupert Harrison, who was described as the architect of the government’s pension reforms, left government to become BlackRock’s chief macro-strategist in 2015.
BlackRock president Robert Kapito said the pension reforms that Osborne introduced in the 2014 budget helped transform $25bn of pension savings into “money in motion” and the firm aimed to “put a lot of effort into putting together more retirement products to capitalise on this market”.
Both Osborne and Harrison have promised they will not lobby the government on behalf of BlackRock, but Osborne has made clear that he intends to work with BlackRock on UK pensions. “BlackRock wants better outcomes for pensioners and savers – and I want to help them deliver that,” Osborne said in BlackRock’s official announcement.
Fink said: “At the centre of our mission is helping people around the world save and invest for retirement, and George’s insights will help our clients achieve their goals.”