KPMG stops providing MPs with free researchers

“KPMG has quietly abandoned a longstanding practice of making donations in kind to MPs and political parties by providing researchers to help in formulating policy and legislation.

The decision by the accounting giant, which has been criticised for its role as auditor to the collapsed construction giant Carillion, comes after figures released by the Electoral Commission in March showed that donations by the big four auditors tumbled by 91% during the 2017 election campaign compared to that of 2015. …

Donations in kind from KPMG, PricewaterhouseCoopers and Deloitte were widespread in the 15 years running up to the 2015 election, with KPMG making £198,093 worth of donations in kind in 2015, falling to £40,575in 2017.

The practice has been criticised by outsiders, who argue that it helps secure long-term political influence, although the firms say they are politically neutral. Prem Sikka, a professor of accounting at the University of Sheffield, said: “The firms don’t make donations. The money is an investment to secure desirable outcomes.”

He cited as an example the abolition of the Audit Commission under the coalition government, which allowed the big four firms into the £100m-a-year local government market for the first time from 2015.

However, such political donations have tumbled after the Labour leader, Jeremy Corbyn, decided to abandon them. Secondments have traditionally been provided to opposition parties, sometimes in considerable numbers, because they do not have the same access to the civil service as government.

… Instead, political donations by the big four firms have become increasingly concentrated on paying former ministers to speak at corporate events. George Osborne, the former chancellor who now edits the Evening Standard, reported in April 2017 that he expected to be paid £65,901 for giving a speech to PwC in Ireland; Nick Clegg, the former deputy prime minister, received £18,000 in December 2016 for giving a speech to PwC. Ken Clarke received £11,500 in fees for giving speeches to KPMG in Leeds and Manchester in May 2016 while Michael Gove collected £5,000 from PwC in December 2016 and £4,000 from Ernst & Young in May 2017, again for speeches.

The big four came under fire earlier this month as part of a highly critical report by MPs on the business and work and pensions committees on the collapse of the construction giant Carillion. Rachel Reeves, the business select chair, said they had a “parasitical relationship” with companies, getting paid even if they went under and called for the Competition and Markets Authority to look at breaking them up “to increase competition and deal with conflicts of interest”. …”

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