Conservative MP for Wealden signed energy pact with Iceland while in office and will now work for importer of Icelandic power

A former Conservative minister who signed an energy pact with Iceland's government has taken a second job, less than a year after he left office, working for a Tory donor who plans to import Icelandic electricity.

Charles Hendry, MP for Wealden, signed a bilateral agreement while energy minister to bring power harnessed from Iceland's volcanoes to Britain through undersea cables. He will now be paid £18,000 a year to advise the Atlantic Supergrid Corporation, which is researching the scope for a transmission cable connecting Iceland to Britain, the register of MPs' interests shows. The firm is controlled by Edmund Truell, the venture capitalist who has donated at least £280,000 to the Tories.

The disclosures raise questions about whether it is right for any former minister to profit from a job so closely related to their government brief, and whether a Conservative donor is getting a potential commercial advantage through a former Tory minister.

Ed Miliband said earlier this month that he would stop MPs from taking second jobs if Labour wins the next election. A YouGov poll last month showed that 56% of voters support a ban on MPs holding second jobs.

The advisory committee on business appointments, which examines new appointments of ministers and senior civil servants, signed off Hendry's new job last month. But committee members are not compelled to ask about the political affiliations of potential employers.

Caroline Flint, the shadow energy minister, said that Hendry's job is an obvious and surprising example of a gaping loophole in current rules that is being abused by former ministers. "There are meant to be rules in place to stop the revolving door between government and private companies and prevent ex-ministers from taking advantage of their positions. Charles Hendry has questions to answer to reassure the public that there is nothing inappropriate about his position with the Atlantic Supergrid Corporation," she said.

Tamasin Cave, a director of Spinwatch, an NGO that campaigns on lobbying, questioned the role of the committee in signing off this job. "The committee's role is to put a check on these revolving doors. [Hendry's new job] reinforces the popular impression of a 'cosy club' of donors and advisers with an inside track to government making decisions in their own interest," she said. Hendry was energy minister from May 2010 to September 2012, in charge of electricity generation. In May 2010, he met officials from Atlantic Supergrid and discussed the feasibility of a new cable at a conference in Iceland.

During the visit, he signed a memorandum of understanding with the Icelandic government about co-operating on energy issues and researching ways to exploit Iceland's geothermal energy, establishing undersea cables to transport energy and exchange information on the oil and gas industries. The head of Iceland's national grid discussed the plan with Hendry.

There are two existing international "interconnector" cables from Britain, to France and the Netherlands, but nine more are either in construction, in formal planning or undergoing feasibility studies.

Hendry will be paid to work one and a half days a week. The role will be in addition to his MP salary of about £66,400. He told the advisory committee on business appointments that he would like to accept the commission through his company Bombo Ltd.

Truell, 49, an adviser to Boris Johnson and founder of the Tungsten Corporation, owns many companies, but one of his two main investment vehicles is Rockhopper Investments Ltd. It is the sole capital provider to Atlantic Supergrid and owns more than 70% of the total profits, according to Truell's declaration of interests.

Truell has given the Conservatives £129,000 since 2010, while a firm he runs called Flexible Securities has given the party another £150,000 since 2007.

Hendry has maintained a good relationship with Cameron since leaving government and is the prime minister's trade envoy to Azerbaijan, Kazakhstan and Turkmenistan. In June he told an oil conference in Baku that Britain is the largest investor in Azerbaijan and the energy sector has a principal place in bilateral cooperation.

In response to queries from the Guardian, Hendry confirmed that he had met a representative of the corporation in May 2010 in Iceland, but said he had no idea of Truell's involvement until earlier this year.

"If his [Truell's] name had been mentioned in any discussions … it had not registered with me as it was not a name I was familiar with and he was not someone who had been involved in energy issues during my time as a minister. It was much later again that learned that he was a party donor," he said.

He denied claims that his future work for the partnership would give a Tory donor a potential commercial advantage, saying that the committee had restricted his future contacts with the Department of Energy and Climate Change. "As with all such consents, there is, rightly, a complete restriction on ex-ministers lobbying their former departments. As a minister, I was not in a position to give contracts nor did I favour one particular interconnector over another. I also initiated discussions with the Channel Islands, Ireland and Norway," he said.

He added that this is a long-term project that could be good for the UK in the future. "If it can help deliver secure, affordable low-carbon electricity to UK consumers, it is something which is in the national interest," he said.

A spokeswoman for the committee said that while Hendry had official dealings with ASC while a minister, he said these did not include discussions about technical specifications or costings. "The committee also took into account that Mr Hendry did not have confidential information about any competitors that could be of use to ASC. His former department, DECC, has also confirmed this was the case," she said.

MPs' second jobs



Members of the public are more concerned about the kind of second jobs that MPs have than the amount of money they earn from them, an opinion poll suggests.

The academics Rosie Campbell and Philip Cowley have recently published research, carried out with YouGov, that shows quite striking differences in public attitudes to MPs' second jobs depending on what they do.

Polls show that, in broad terms, a majority of people are opposed to the idea of MPs having second jobs. But, to explore attitudes in greater depth, YouGov asked respondents to rate two fictitious MPs and then explored how their ratings varied when new information about their outside interests was added.

Taking on a non-executive directorship after becoming an MP produced the worst result. The MP's ratings fell by 27 points when respondents were told that he earned £10,000 a year this way, and only marginally more when told he earned £50,000 a year this way.

MPs who had been lawyers or GPs in their pre-Westminter life also saw their popularity decline if they continued to work once entering parliament, and their popularity declined markedly the more they were earning. But the fictitious GP MP was much more popular than his fictitious lawyer counterpart.

Interestingly, the only fictitious candidate not affected by having a second job was the one who set up a company before entering parliament and continued to run it. Even if he was earning £50,000 from the role, his popularity did not decline from its baseline.

"If the aim of any income cap [for MPs] is to make politicians more popular, then we need to realise that the issue for the public is not just the sums of money involved but both the sums and the source," Campbell and Cowley wrote in a blog publicising their findings. "Continue to earn £50k from a company that you had set up before becoming an MP, and the public do not especially seem to mind." Andrew Sparrow