4 Feb 2011

Trade Minister in line for £3.6m share bonus

Channel 4 News has learned that David Cameron’s new Trade Minister is in line for a £3.6m share payout from banking giant HSBC – as the Government attempts to strike a deal on bankers’ bonuses.

HSBC told Channel 4 News that Lord Green of Hurstpierpoint – who was HSBC chairman until last month – was eligible for shares worth an expected £3.6m, if the bank decides he met various performance targets.

The disclosure came after the Cabinet Office published a list of Ministerial interests, which said that Lord Green had been awarded “payment in shares for 2010-11”.

HSBC told Channel 4 News that that related to a long-term incentive plan, awarded in 2007, and paid out last year. That bonus totalled £847,000. The £3.6m potential payout would be part of a similar plan for 2008, which matures this year.

The Business Department insisted tonight that all the shares would be donated directly to the Bishop Radford Trust, a Christian charity, which supports theological schools. Lord Green’s wife is a trustee of the charity.

However, the revelation that the Trade Minister is eligible for such a substantial bonus underlines the government’s close ties to the banking industry. Conservative and Liberal Democrat government members are currently locked in negotiation with the banks to try and secure a deal to boost lending and curb bonuses.

Lord Green of Hurstpierpoint (Getty)

Project Merlin

Channel 4 News understands that an agreement will be announced within two weeks. One Government member familiar with the talks said the four banks now involved in the “Project Merlin” talks would back a plan to tie lending targets to bonuses. The source said banks would agree to dock bonuses if they failed to meet an agreed target for lending to small and medium sized businesses.

Companies say they’re struggling to survive because banks are too cautious to lend them money in the wake of the financial crisis.

The Register of Ministers’ Interests highlights the healthy bank balances of many Government Ministers. Some 16 Ministers – including Chris Huhne, Andrew Mitchell, Ken Clarke and Francis Maude – have their assets organised into “blind trusts”. Such trusts enable Ministers to relinquish control of their assets to avoid a conflict of interest, while allowing them to keep any income.

Such financial arrangements are used by both Lib Dem and Conservative Ministers. An interest they also share, it turns out, includes beekeeping. David Cameron is President of the Oxfordshire Beekeepers’ Association while the Business Secretary, Vince Cable, is a patron of the Twickenham and Thames Valley Beekeepers’ Association.