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Firms forming the Prime Minister’s new Business Council of corporate executives have collectively been fined nearly a billion pounds by regulators over the past decade for a string of rule breaches – from bribery to money laundering and workers’ rights violations.
The Business Council, launched by No 10 on Wednesday, will meet officials “throughout the year” to discuss economic growth, giving them the ear of the Prime Minister directly.
No 10 says the council will have a regular meeting with the Prime Minister in Downing Street to “share intelligence directly from the shop floor to help boost the UK economy and create jobs”. The first meeting will take place next month.
Eight of the 15 firms on the Government’s new Business Council have been fined for breaking industry rules or the law over the past decade, Byline Times analysis shows.
The Council includes Chief Executives from:
- BT Group – fined £6.6 million since 2014 for price fixing (Ofcom, 2020), consumer protection breaches (Ofcom, 2020) and more
- Nationwide Building Society – fined over £9 million since 2014 for major banking and insurance violations
- Unilever – fines of £190,000 for labour standards and health and safety breaches
- Rolls-Royce – received a fine of £510,000,000 in 2017 by the Serious Fraud Office for bribery offences in Indonesia, Thailand, India, Russia, Nigeria, China and Malaysia.
- Scottish Power – fined nearly £4.4m since 2014, much of which related to failing to reach smart meter installation targets alongside other energy giants
- Barratt Developments – fined £343,000 since 2014, including a £75,000 fine last year from the Environment Agency for unauthorised discharges into waterways in Bradford in 2020/2021
- Lloyds Banking Group – 37 regulator or court rulings against the parent company since 2014 – the most of any firm on the Business Council. It includes 12 labour standards violations and 10 pension plan errors. Lloyds’ insurance arm received a £117m fine in 2015 over the mis-selling of Payment Protection Insurance, as well as over £90m in 2021 for misleading home insurance renewal information. In 2020, Lloyds Bank and subsidiaries paid £64 million fines in settlement of findings by the FCA that they did not fairly handle mortgage customers in payment difficulties or arrears, Violation Tracker reports.
Rolls-Royce and Lloyds are in the top 10 most fined companies in the United Kingdom for regulation breaches.
Firms which have escaped regulators’ ire include OMass Therapeutics, Raspberry PI, Principality Building Society, Informed Solutions and Castore.
As No 10 noted, the firms on the Council employ over 200,000 employees from across the United Kingdom. But collectively they have faced at least 80 sanctions or fines from regulators since 2014, with 19 coming from the Environment Agency, 15 from the Competition and Markets Authority and 11 from the pensions regulator.
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Prime Minister Rishi Sunak said: “Coming from a small business family, I know how integral business is to communities and the wider economy. Without the jobs, growth, and innovation created by UK firms, the country simply wouldn’t function. That’s why I’m getting businesses in for a regular update on how well we are doing in delivering for business – straight from the shop floor.”
But Andy Agathangelou, Founder of the campaign group Transparency Task Force said the Government’s new Business Council was “riddled” with organisations that collectively have faced huge fines in recent years.
“We are all therefore left wondering whether there have been grave errors of judgement on which organisations to include – if organisations were selected despite their appalling violations record; or if it’s even worse than that: that no due diligence checks were carried out at all. Either way, both the substance and optics around this are alarming.”
Fran Boait, co-executive director of Positive Money, said the Government was rewarding failure: “That you can be fined millions and still have the ear of the government speaks to the huge influence vested interests have over our public policymaking.
“Rewarding firms with such patently poor records with a say over how the economy runs is as good as giving them a free pass to continue acting out of line.
“Seats at the table should be filled by those who can represent the public interest, or else we risk doubling down on deregulation, which will end up costing us all dearly.”
The Prime Minister’s spokesman told Byline Times: “This about having the right mix of businesses, both small and large. They are significant employers and contributors to our economy. It’s important that the government listens to the voice of business.
“I think you’re referring to some specific instances which have been picked up by regulators and addressed by those companies. But that is not a reason to shut out companies that employ in some cases tens of thousands of people and contribute significantly to the economy.”
Byline Times analysed Violation Tracker UK data to assess the types of fines received by the Business Council firms over the past decade. Labour standards and pension plan violations made up the plurality. But in terms of fines levied, banking and insurance rule breaches were the most severe.
Juliet Michaelson, co-director of climate charity Possible, added that having companies who have been fined for environmental breaches advising the government on business was like “asking a fox to work on chicken safety policies.”
“The government business council hopes to bring a real-world perspective on how the economy is impacting businesses, but to ignore climate and environmental issues in that perspective is woefully wrong when they go hand-in-hand.
“We are in a climate crisis and that isn’t going away. What we need going forward is strong leadership from politicians and business leaders to be able to work on policies that will benefit the public, the economy, and the climate. How can we trust them to do that if they have already failed the climate before?” Michaelson asked.
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