This article is more than 1 year old

This article is more than 1 year old

One in five members of the House of Lords are working as consultants or advisers to private businesses at the same time as serving in parliament, the Guardian can reveal.

An analysis of the Register of Lords’ Interests shows 169 peers reported working as advisers earlier this year, with more than a dozen registering that they were also paid by foreign governments on top of the expenses they are entitled to as peers.

The consultancies range from a former Conservative MP advising the company of a Romanian businessman facing extradition, through to a former chief of defence staff who advises the government of Bahrain.

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The worlds of finance, energy, mining and defence are extensively represented among peers’ clients. Unlike MPs, peers are considered part-time public servants, which allows them to pursue other business. Peers are permitted to work as advisers for private interests, as long as they are properly declared.

The findings include:

A leading Labour peer, Lord Levy, has apologised after admitting failing to register three private interests connecting him to a billionaire Russian businessman.

Fifteen peers are working for or advising foreign governments, including a former coalition government cabinet minister and a former chief of defence staff.

Thirty-eight peers indicated they provide public affairs or strategic advice, an area of particular sensitivity because such work can easily stray into lobbying.

Eighty-three peers have declared an interest in finance or banking, with HSBC, Santander and Royal Bank of Scotland among those to have provided paid roles as directors or paid advisers to peers.

Twenty-seven have declared an interest in energy firms, with the same number reporting an interest in companies working in the defence or security sectors.

The coalition government’s Cabinet Office minister, Francis Maude, listed a string of foreign government clients, including the governments of Lesotho, Omanand New South Wales, the Canadian treasury, and the Australian Digital Health Agency.

Lord Maude also advises the government of Bahrain on public sector efficiency, despite continued reports of human rights abuse.

His business partner, Simone Finn, was an aide to Maude during the coalition government. She is also now a peer. FMA Partners did not respond to invitations to comment.

The former chief of defence staff David Richards, styled Lord Richards of Herstmonceux, lists the king and government of Bahrain as his “personal clients”, via his company Palliser Associates. He has also previously advised the government of Jordan.

He is also the chair and director of Equilibrium Gulf and Equilibrium Global, two companies described in his register as providing “geostrategic advice to governments and companies”.

Richards said his work for the Bahraini government was known to the British ambassador and the Foreign Office and was being conducted “with the singular and honourable purpose of seeking to advance and to facilitate the wide-ranging reform programme within Bahrain”.

He said he could not comment on allegations of human rights abuse, but: “What I am able to say is that my work and, to my knowledge, the work of my fellow peers is entirely consistent with improving the kingdom’s human rights footprint”.

There is no rule preventing peers from working for foreign governments. However, such work is becoming controversial amid growing concern in Westminster about attempts by foreign governments to obtain influence over British democracy.

This month the home secretary, Sajid Javid, said he was considering introducing a US-style foreign agent registration act that would require those representing nation states to notify the government and provide information about their work.

Transparency International UK’s policy director, Duncan Hames, said peers’ work for outside parties created a risk of conflict of interest.

“It is particularly alarming that there are peers sitting in parliament who are working for foreign governments, and even more so considering the human rights records of these regimes,” he said. “Allowing this sort of outside work to continue only furthers the erosion of public confidence in the integrity of our parliament.”

Following the Guardian’s report on Thursday that one in three peers rarely contributed for a full year, the Electoral Reform Society called for urgent reform and warned its own research indicated only 4% of people felt represented by Westminster.

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“While many peers work hard, this system is ripe for abuse and some continue to use their positions to freeload on the public purse. Without the light of democratic scrutiny, peers can take advantage of the situation with impunity,” said Willie Sullivan, senior director at the ERS.

A House of Lords spokesperson said: “The code of conduct requires members to register all financial interests, and relevant non-financial interests. They must also declare relevant interests when speaking in debates and participating in other parliamentary activities, such as tabling questions to the government. This is important as it ensures members’ interests are transparent and can be assessed against their parliamentary activities. Members are banned by longstanding rules from providing any parliamentary advice or services, in return for financial reward.

He continued: “Members are not full-time politicians and bring their wealth of expertise from a range of sectors including charities, academia and business to their work in the House of Lords. What matters is that their interests are transparent and public, as is the case.”

Michael Levy

The Guardian has established that the Labour peer Michael Levy failed to declare three interests linking him to Moshe Kantor, a billionaire Russian fertiliser businessman and philanthropist.

He admitted the “unintended oversight” following inquiries about his work as a financial consultant to a Luxembourg firm called Rotco SA, which he did declare. When first asked about what his work for the company involved, Levy refused to answer.

That initial refusal to respond exposes a gap in the framework governing peers’ interests. Parliamentarians are not required to identify the ultimate beneficiaries of their work, or of any firms that hire them as consultants.

After subsequent inquiries revealed multiple links between the company and Kantor, a spokesperson for Rotco confirmed Levy’s work had been for the benefit of the businessman.

“Rotco’s client Dr Kantor is extremely proud of all his work and activities in the charitable world and delighted with the help and advice that Lord Levy gives,” she said.

Levy subsequently accepted that he had failed to register his positions with three entities: Kantor Foundation, Kantor Charitable Foundation and Kantor Trustees. The interests have now been added to his register, along with Levy’s family charitable trust.

“I have apologised to the clerk for what was an unintended oversight,” he said. “I have made every effort to act with total integrity in my being a member of the House of Lords and also in all my charitable work.”

Andrew Robathan

In a separate case, a Conservative peer wrote an opinion piece criticising Romanian police as corrupt without disclosing that he had been hired by the company of a Romanian businessman sought on corruption charges.

The former Conservative MP Lord Robathan included his work for the Nova Group, which is owned by the Romanian Adamescu family, on his register of interests. The Romanian government is seeking the extradition of Alexander Adamescu on corruption charges, which he denies.

Robathan has publicly supported Adamescu, and provided surety of £20,000 at a bail hearing for him.

Last year Robathan published an article on the website ConservativeHome attacking Romania’s anti-corruption police and extradition procedures as corrupt. He did not mention his connection to Adamescu.

Robathan said he was “almost certain” that ConservativeHome knew of his role advising the Adamescus. “My involvement and concern over Romania came about because of my acquaintance with Alexander,” he said.

“I wanted to raise his case in the article, but it was thought that it would be better to focus on the substance and facts of the wider issue, because that would be of greater interest.”

ConservativeHome said it was not aware of the relationship.