Conservative MP Takes £60,000 Job at Firm Linked to Tax Haven

Conservative MP Takes £60,000 Job at Firm Linked to Tax Haven

Another parliamentarian has gained lucrative employment outside Westminster, reports Sam Bright

A Conservative MP has accepted a £60,000 second job at a firm linked to the tax haven of Bermuda, Byline Times can reveal.

Mike Penning, the representative for Hemel Hempstead, recently registered a new non-executive directorship at Tenacious Holdings Limited, worth £ 5,000 a month in exchange for 18 hours of work.

Penning already earns £43,992 from two other additional jobs. Taking into account his new role at Tenacious, and his MP’s salary of £84,144, Penning’s annual earnings now stretch to £188,136 – the majority of which are earned through the private sector – placing him in the top 1% of earners in the UK.

“As an MP my constituents will always come first. That remains the case whether I do paid work or unpaid work such as patronages of local charities and sports clubs,” Penning told Byline Times.

According to the company’s website, Tenacious is an “international consumer products group championing emerging plant-based ingredients, including CBD” – a chemical derived from the hemp plant. The firm’s website lists its headquarters in Mayfair, central London, and Miami, USA.

Two of the individuals listed on Companies House as persons with significant control of Tenacious Holdings are employees of Meritus Trust Company – which, according to its LinkedIn page, “provides unparalleled fiduciary services to select ultra-high-net-worth international families and multinational corporations”.

Both of these individuals are founding partners of Meritus, which is based in Bermuda, a tax haven which imposes no taxes on profits, income, dividends, or capital gains. In effect, the jurisdiction allows for the maximisation of profits and wealth through the minimisation of tax liabilities.

There are several reasons that a company may choose to be linked to a jurisdiction such as Bermuda – including privacy purposes – and we don’t know exactly what benefit Tenacious derives from its relationship with Meritus. Whatever the relationship, these sorts of arrangements are entirely legal – including those pertaining to taxation.

A spokesperson for Tenacious told Byline Times that the firm “is registered in the UK with a portfolio of international shareholders. The group, and its subsidiaries in the UK and the United States, pay all applicable local taxes.”

However, there are still questions to be answered about an MP receiving considerable financial compensation from a company linked to a tax haven. Bermuda was ranked by Oxfam as the world’s worst corporate tax haven in 2016, allegedly allowing companies to shift their tax responsibilities by using subsidiaries and other tax arrangements on the island.

“I am very pleased to have been invited to work with Tenacious Holdings to help them navigate the political and legislative landscape as they explore the medical benefits and opportunities of CBD,” Penning told Byline Times. “I have long been a supporter of prescribed medical cannabis to help children with severe epilepsy as I have seen first-hand the incredible results it can achieve and I have been frustrated by the bureaucratic delays blocking access to so many children who could benefit. Tenacious Holdings is one of the companies leading the way in this area and it is a fast-growing sector that could benefit the UK in many ways.”

APPG Allies

Meanwhile, this isn’t the only connection between the firm and parliamentarians. Tenacious is the secretariat of the all-party parliamentary group (APPG) for CBD products, coordinating the group’s activities. The APPG is co-chaired by Conservative MP Crispin Blunt and Baroness Zahida Manzoor – a Tory peer.

At the time of writing, the current website for the APPG notes that “Tenacious Labs has no direct or indirect financial arrangements with any political figures in any territory or country”. Due to Penning’s recent appointment, this claim is now false.

The APPG has lobbied the Government for relaxed restrictions on CBD use, with Blunt sending a letter in late April to Parliamentary Under-Secretary of State for Science, Research and Innovation, George Freeman, claiming that “The UK CBD industry is greatly concerned about the negative impact of current regulation and the difficulty of getting industry views… to Government”. Blunt proposed that coordination between the sector and the Government should be arranged through the APPG.

Conservative MP Gets Promotion at Energy FirmHe Was Called to Resign From

Sam Bright

In May, Parliament’s Committee on Standards recommended a new set of reforms to regulate APPGs – warning that they have “created the conditions for inappropriate influence and access”. The report goes on to warn that “if left unchecked, APPGs could represent the next great parliamentary scandal, with commercial entities effectively buying access to and influence of parliamentarians and decision-makers”.

The Committee also warned that the “risk of improper access and influence by hostile foreign actors through APPGs is real,” and that “there is also evidence that this risk has already materialised”.

There is no suggestion that Tenacious Labs has misused its position as secretariat of the APPG for CBD products. However, there are evidently pressing concerns that APPGs allow excessive influence on parliamentarians from private bodies.

Meritus, Crispin Blunt and the APPG for CBD products did not respond to our request for comment.