In thrall to the lobbyists: As PM delays crackdown, network with hotline to No.10 is revealed



'Revolving door': It's claimed that David Cameron's close friends have access to the heart of government

David Cameron was last night accused of pandering to the lobbying industry – as it emerged an extraordinary network of his own friends has taken up key positions in the sector.



Campaigners claimed a planned crackdown on the industry had been delayed because of the influence of a string of powerful lobbyists, who include a number of close friends of and former advisers to the Prime Minister.



They warned that lobbyists had successfully established a ‘revolving door’ between Mr Cameron’s inner circle and the industry, giving their clients direct access to the heart of Government.



Downing Street was on the defensive yesterday over the Coalition’s failure to impose a statutory register of lobbyists, but insisted it would go ahead in the wake of the scandal that engulfed former Defence Secretary Liam Fox.

In February last year Mr Cameron warned that lobbying was ‘the next big scandal waiting to happen’.

A crackdown on the industry was included in the Coalition agreement last year, and Deputy Prime Minister Nick Clegg pledged it would be put in place this year.



Change is now likely to be delayed until at least 2013 – with lobbyists hoping it could be put off still further once the row over Dr Fox has died down. Aides to Mr Clegg – whose wife Miriam is a senior figure at law firm DLA Piper, which offers lobbying services – was unable to say why it had been delayed.

Government sources said it was ‘absolute nonsense’ to suggest that ministers had put off action because of the influence of friends in the lobbying industry.



But Tamasin Cave, of the Alliance for Lobbying Transparency, accused ministers of ‘pandering’ to the industry, which is thought to be worth £2billion a year in the UK.

She said: ‘Lobbyists have clearly been successful in persuading their friends in Government to delay and water down regulation that is long overdue. The revolving door between Team Cameron and the lobbying industry is particularly well oiled. If you pay someone who is mates with David Cameron you get a much louder voice in Government than an ordinary person – that is how lobbying works.’



Key players with close links to the Prime Minister include his own Tory constituency association president Lord Chadlington, who is chief executive of the powerful Huntsworth group, which runs a number of lobbying firms.



His companies include the lobbying firm Quiller, which employs former key Tory aides, including Mr Cameron’s former campaign director George Bridges, who was at Eton with the Prime Minister. Other Quiller executives include Mr Cameron’s former aide Stephen Parkinson and Malcolm Morton, a former adviser to the Cabinet Office Minister Mark Harper, now in charge of regulating the lobbyists.

Other key Cameron friends in the lobbying industry include the disgraced former MP Andrew MacKay, who was once his right-hand man in the Commons and now works at Burston Marsteller.



Mr MacKay’s wife Julie Kirkbride, who also quit Parliament in the wake of the expenses scandal, is a lobbyist at Tetra Strategy, which made headlines earlier this month for its role in introducing a businessman to Dr Fox’s unofficial adviser Adam Werritty.



Another major player is former MP Tim Collins, Mr Cameron’s former colleague in the Tory research department, who holds a senior position at Bell Pottinger.



Tory MP Jesse Norman yesterday described lobbying as a ‘canker on the body politic’. Fellow Tory Douglas Carswell said: ‘The lobbying industry is not pretty, not democratic and needs cleaning up.’



But Peter Bingle, of Bell Pottinger, insisted it was essential that business and interest groups were ‘able to talk to Government’.



Downing Street last night said lobbying reforms had not been delayed and that no timetable had been set in the Coalition agreement.





Hedge fund baron Hintze - sugar daddy to Cameron and Co



By Keith Gladdis, Arthur Martin and Richard Pendlebury



Last updated at 1:54 AM on 18th October 2011

Money man: Michael Hintze who has given the Conservative Party over £1million

A millionaire hedge fund baron who bankrolled former Defence Secretary Liam Fox made a series of personal donations and gifts to a string of senior Cabinet Ministers, including the Prime Minister and Chancellor, it emerged last night.



Soldier turned banker Michael Hintze has given at least £1.2million to the Conservative Party and provided a further £2.5million in loans since 2005.



Mr Hintze, 58, also gave more than £100,000 to the Atlantic Bridge charity set up by Dr Fox and run by his self-styled adviser Adam Werritty.



Now the Daily Mail can reveal how other senior Tories have received individual gifts and donations from the banker.

Prime Minister David Cameron and Chancellor George Osborne are among the top Tories who have benefited personally from the former Goldman Sachs banker.



Home Secretary Theresa May, Foreign Secretary William Hague and new Defence Secretary Philip Hammond also received gifts or donations from Mr Hintze or his company, CQS Management. Even London Mayor Boris Johnson and former Tory leadership candidate David Davis have been backed by the banker.

His generosity makes him one of the biggest Conservative Party donors behind Lord Ashcroft and has raised concerns about his influence.



Labour MP John Mann has asked the Electoral Commission to investigate. He said: ‘Michael Hintze is the new Godfather of Tory donations.



‘He is putting his money behind the key people in the party very deliberately. People never give money for nothing. They want something in return, they want influence.

‘Michael Hintze is a hedge fund boss and where he wants influence is over financial regulation. He does not have to ask Tory Ministers for anything, the act of giving simply changes their behaviour.

When they come to consider the issue of financial regulation they are much less likely to do something if it upsets someone who makes such generous donations.’



Mr Hintze made a personal donation of £10,000 to Dr Fox when the Conservative Party was in Opposition.

Other payments to senior Tories when in Opposition include £37,500 to Mr Osborne, £25,000 to Higher Education Secretary David Willetts and £1,200 to Mrs May.



Former Tory leadership candidate David Davis received £7,000, backbencher Adam Holloway £1,500 and Boris Johnson £5,000.

In addition, CQS made ‘non-cash donations’ to Mr Osborne of £1,254, while Foreign Secretary William Hague received £25,763 and Dr Fox a further £10,439.



Mr Cameron and Mr Osborne travelled from Newcastle to Biggin Hill in a plane paid for by Mr Hintze after the Conservative Party conference in March 2008.



In May that year Mr Cameron declared a donation from Mr Hintze to the Conservative Party that was used to pay for drinks receptions for Tory MPs and their partners.



Mr Mann has also raised concerns over potential donations Mr Hintze may have made to figures around the Conservatives, such as Mr Werritty.



His hedge fund has investments in companies that have contracts with the Ministry of Defence. Also, in the autumn of 2008, at the height of the global financial crisis, a CQS funds short-sold Bradford and Bingley shares.



Mr Mann said: ‘This raises the question over whether Adam Werritty was the only person with potential influence on the government who was being funded by Mr Hintze.’





Refugee from Communism who made a £700m fortune

One of Michael Hintze’s favourite and oft-quoted maxims is taken from Luke 12:48: ‘Unto whomsoever much is given, of him shall be much required.’

At the Belgravia headquarters of his $10billion CQS hedge fund, one employee is tasked solely with opening the flood of letters which arrive daily, asking the celebrated philanthropist for money.

‘Somebody has to read them, and treat those people with respect,’ Mr Hintze, a devout Roman Catholic, once explained. ‘They are not asking just because they want something for nothing.’

Quite. In the light of ongoing revelations one wonders how many of these pleas bore the Conservative Party crest. That Mr Hintze has given much to the Tories in recent years is beyond dispute. His loans and donations total around £4million.What he requires in return for such bankrolling is a question that the electorate can, today, quite fairly wonder.

His name was thrust into the spotlight when it emerged Mr Hintze’s hedge fund had sunk £21.5million



into a defence company which benefited from an announcement made by the Defence Secretary Liam Fox in July to replace the ageing fleet of Nimrod spy planes.

So was it for commercial gain or purely philanthropic reasons?

'My success has happened in the UK because of the context that the Conservative Party provided'

‘He is an ideologue, albeit one who is politically naive,’ argued an acquaintance. ‘When someone like-minded asks him to sign a cheque or give office space, he won’t hesitate.’

Whatever the motive or, indeed, the power he wields as a result of such largesse, Mr Hintze is a remarkable man from an extraordinary background.

He was born in the Chinese city of Harbin, to which his family had fled from Russia during the Bolshevik revolution.

Following the then recent seizure of power by the Chinese Communists the family moved again, this time to Australia.

Mr Hintze grew up in Sydney, raised by a single, secretary mother and educated by the austere Christian Brothers, whose examples, he says, has informed his later life. He studied physics and engineering at university, before joining the Australian Army, as a junior officer, for three years.

When he left he gained an MBA at Harvard Business School, where he met his wife Dorothy, and afterwards embarked on a blitzkrieg through the world’s great finance houses, working for Salomon Brothers in New York, then Goldman Sachs and CSFB in London, before setting up Convertible & Quantitative Strategies in 1999.

The £200million with which the fund was launched has since multiplied many times over, as has his wealth. In 2005 alone he was reported to have earned for himself as much as £60million; the latest Forbes List estimates his personal worth at around £700million. Not that you would guess by his lifestyle.

Unlike most other hedge-funders, who favour the gold-paved streets of Mayfair, he lives south of the Thames, in the relatively unglamorous borough of Wandsworth. His four children were all state-educated.

But while bling is not his thing, Mr Hintze has made an indelible mark in public life through his £25million patronage of the arts, education and good causes through the Hintze Family Charitable Foundation.

All very laudible. But Mr Hintze’s political donations invites more rigorous analysis.

Last year Mr Hintze, who holds dual British and Australian citizenship, said: ‘It is pretty clear to me that my success has happened in the UK because of the context that the Conservative Party provided.’

And he was grateful enough to repay that provision, very handsomely indeed.

We know this because the Adam Werritty affair is not the first time he has reluctantly revealed the extent to which he is the money man behind David Cameron’s Conservatives.

In 2006, during the New Labour government’s ‘cash for honours’ scandal, a loophole in political funding was exposed relating to loans serviced at commercial rates, which could remain secret.