Finance / Theresa May ‘used well-established mechanism’ to set up blind trust
Theresa May ‘used well-established mechanism’ to set up blind trust
11 January 2017
Downing Street has insisted Theresa May used a "well-established mechanism" when she set up a blind trust to manage her financial interests on becoming Prime Minister.
The arrangement is often used by ministers to avoid conflicts of interest in their Government work and means they do not have to reveal their investments in full in the list of ministerial interests.
The placing of shares in a blind trust means ministers have no knowledge of how their interests are being invested to avoid accusations that their decision-making is unduly influenced.
The arrangement has proved controversial in the past, with Tony Blair attracting criticism while PM in 2002 when it emerged his wife Cherie had used money from his blind trust to buy two flats in Bristol.
Mrs May set up a blind trust when she became Prime Minister, despite serving in the Cabinet for six years as home secretary.
The arrangement was revealed in the Cabinet Office list of ministers' interests published last month.
Six other ministers hold shares managed by blind trusts.
A Number 10 spokeswoman said: "Blind trusts are a well-established mechanism for protecting ministers in the handling of their interests, as they are not involved in any decisions on the management, acquisition or disposal of items in the trust. She set it up when she became Prime Minister."
The spokeswoman also said the PM did not require a blind trust while home secretary.
"The Prime Minister has a far wider set of public duties than the home secretary," she said.
"Accordingly, the blind trust was established when she became Prime Minister."
Liberal Democrat leader Tim Farron said: “I’m sure the Prime Minister has nothing to hide but the public has a legitimate interest in what companies she invested in and who runs the trust.
“Theresa May promised the most transparent government in the world. This is an early test to see if her deeds match her words.”
On coming to power in 2007, Labour former prime minister Gordon Brown amended the ministerial code of conduct to remove a warning about the use of the arm’s-length trusts.
An earlier version of the code, which sets out guidance on ethics and procedure, said ministers may want to place investments in an externally managed blind trust, to avoid any appearance of conflict of interest.
But it added: “It should also be remembered that even with a trust the minister could be assumed to know the contents of the portfolio for at least a period after its creation, so the protection a trust offers against conflict of interest is not complete.”
Labour also called on Mrs May to reveal what she has invested in.
Shadow minister without portfolio Andrew Gwynne said: “Not even six months in the job and Theresa May’s government is starting to be defined by its secrecy and complete lack of transparency.
“If the Prime Minister has nothing to hide then she needs to reveal immediately where she has existing financial interests.
“In not being able to scrutinise the Prime Minister’s financial affairs it’s not possible to know if they present a conflict of interest with her government responsibilities.”
Photo from Hannah McKay / PA Wire