Exclusive: Ex-Tory whip on why he lost his job and how he kept his soul
Asa Bennett talks to the former whip about his plans as a “free man” and why we should “thank the rich”
“If you spend a long time as a Whip, the iron of cynicism starts to corrode your soul.”
Andrew Mitchell’s poetic answer to suggestions that he could become Chief Whip is bitterly ironic, after doing exactly that a few months later and burning-out after problems dealing with the “plebs” at the Downing Street gates.
With Mitchell’s tale in mind, what would I find when I met Brooks Newmark? He spent five years as a Conservative whip in and out of government. Now he’s a backbencher, and can at last be frank about his experience.
For the non Westminster-insiders, a whip helps keep his fellow MPs in line, making sure they vote the right way as their lot want. They themselves are not allowed to speak out and are there to rigidly “toe the line”. Scenes like this from the BBC’s House of Cards would give you an idea, but we’re not suggesting Newmark ever advised MPs on “where to find a decent knocking shop”…
Newmark admits that he was lured to become a whip as he came to Parliament “from the outside”. Before I meet him, a waggish tweeter suggests I ask him if he was ever part of the CIA. A farcical idea, although Newmark seems to have mastered the art of discretion. When he talks, every word sounds like it has been considered.
He isn’t a carbon-copy Westminster insider, having moved over to the UK at the age of 9 from across the Atlantic. He was originally born in Westport, Conneticut – yes, his New England accent is still intact.
An alumnus of Harvard, Oxford’s Worcester College and then Harvard Business School, Newmark went into the City for more than 20 years. His business career took off, with Newmark estimated to be worth £3.2 million.
Showing off his new office with a high-rise view over Parliament Square, it’s clear life outside of the Whips’ office can have its upsides. Recently rejoining the Treasury select committee (after a stint pre-Whip), Newmark can’t hide his eagerness to get to grips the new economic issues. Why did he ever let himself be muzzled as a party whip?
“I didn’t really understand fully how Parliament works,” he replies. He took on the job hoping that it’d be a stepping stone to a higher calling (as John Major did, becoming prime minister seven years after his time as whip). However, Newmark was disappointed to be overlooked, getting “caught in the Whips Office for five years”.
Newmark gets rather reflective on his career, as one of the casualities from this year’s reshuffle, telling me that it was “fairly frustrating when you feel you have a lot to contribute”.
“I’ve taken my vow of silence for long enough, now I can speak up on things I feel strong about.”
Rumours persist that Newmark was sacked for his prolific tweeting, with comments on Downton Abbey, Spooks and one particular film review of Bridesmaids – “‘Guys it may be a chick flick but it was hysterically funny!”.
Newmark is dismissive of the idea, “I’d be surprised if the odd tweet I did was the thing that tipped it”, but his own theory is the less-clear “for whatever reason, the PM wanted a clean sweep out of the whips office”.
Newmark is cooler at the mention of another former whip who has taken to Twitter with aplomb, Michael Fabricant. What does he think of Fabricant and his “OMG” and “twank” ridden tweets.? “Oh Michael, he’s just looking for attention”, Newmark drily replies.
Nevertheless, Newmark remains optimistic, telling me that he hopes if he does well on the Treasury select committee, “maybe in the next one or two reshuffles… I’ll have a chance to have a speaking role instead of being a mute at the whip’s office”.
So what can we expect from Newmark?
Dear reader, he wants you to know he understands you, even if he is a “poacher turned gamekeeper”. Setting himself out as an “ally of business and the City, and certainly an advocate for the City”, he tells me that if you want to contact him – you’ll “have a sympathetic ear”. As a local Essex MP (for Braintree), he has blazed a trail in promoting local businesses.
He’s not afraid to match his pro-business claims with his rhetoric, praising the City as a “centre of excellence [with] some of the smartest people in the world working there”.
“There is no point in people beating up the banks when we rely on the banks to provide the liquidity we’re going to need,” he warns.
Newmark is very much a free-markets man. Banking licenses should be relaxed so asset management and private equity firms can compete.
“It’s still effectively an oligopoly out there where very few banks are there to provide loans to businesses and individuals” he says, going on to float the idea of providing “more licenses to other bona fide institutions”.
The benefit? Newmark points to the “huge pool of capital” they have to offer.
He takes a swipe at the “contradictory” message from politicians, as they press banks to shore up their balance sheets while also lending more.
“We have 650 politicians here all banging the drum saying banks should be lending more”.
Does he put it down to a lack of financial understanding among many MPs? “Certainly”.
The private sector, for Newmark, needs to drive the economic recovery.
“In Gordon Brown’s time, for every four jobs created – 3 were in the public sector and 1 in the private sector. We need to invert that”
As befitting a former whip, he’s well-versed in Tory lines – pointing to 1m jobs created in the private sector to balance public sector job losses of half a million.
Newmark would set out his stall as a believer of “flatter, simpler” taxes.
So would he want a system like Hong Kong, with its 16% flat tax? Newmark says not as “they don’t have a huge social care responsibility as we do in this country”.
He lavishes praise on the Laffer Curve, drawing out the lessons on tax as “not being about political gestures but collecting revenue”.
No fairer taxes, “broadest shoulders must bear the biggest burden” shtick? Newmark doesn’t quite sign up to that.
“We have to thank the rich for the contribution they make to our country because the top 1% pay 28% of tax collected, which is then used for all the social and welfare benefits that we have. My own perspective on the argument is the top 1% of the country are bearing the biggest burden.”
Newmark certainly isn’t one to beat around the bush then.
Politicians love to talk about effective taxation, so how would Newmark re-do our tax system? To his credit, he has an idea.
“A flatter simpler tax at 20% - VAT, the base rate of income tax, corporation tax and inheritance tax at 20%. We could do this at the lower end while maintaining the high end at around 40%.”
His business brain kicks in as he quickly adds a disclaimer – “you’d need to flesh through those numbers to make sure they balance out”.
The Bank of England and governor Mervyn King would have the most to fear from Newmark’s presence on the Treasury committee. He has been a long-standing critic of their programmes of quantitative easing, saying about it in 2009 “QE is the crack cocaine of monetarism. If all else fails, print money”.
Newmark laughs and neatly avoids my bait, but he makes clear his scepticism.
“I’ve never been a fan of QE. It ultimately debases your currency. If there’s enough of it, it stores up inflation later on down the road.”
His plan, if the Bank governor comes before the committee anytime soon is to grill him on “how he quantifies the benefits”.
“What concerns me is there is a race to the bottom, with not just the UK, but the US printing cash, the Europeans printing cash and the Japanese still printing cash after all these years”.
Newmark is clearly a sceptic. I remind him of the 2nd part of his comment that –“if all else fails, print more money”. Has the Bank run out of ideas?
Newmark sounds like he subtly agrees – describing QE as “something you do at the absolutely last resort”.
“We did that last resort when we did the first £200bn, what has been the marginal impact of further QE?”
“I’ll certainly remain sceptical about it that in the same way that lowering interest rates will have a very marginal impact. Interest rates are at a historic low. Is it going to be the decider given they’re at a 200 year low? Is it going to be the decider in making that investment, yes or no? I suspect not.”
For Newmark, the key is inspiring business confidence. He proudly talks of the Seed Enterprise Investment Scheme (which he has been personally touting around the country), as a programme to “unlock the cash that’s out there”.
“If you back a small business, a start-up less than 2 years old, less than 25 people and less than £100,000 of capital and you put in 10k to back the start up, you’ll receive 50% of that, top-sliced off your income tax. If you hold that investment for three years, it is capital gains tax free.”
He is firmly behind the coalition’s programme, even the “cuts” that Labour bemoan. The difference between the coalition and Labour’s rate of spending cuts, he quips, is like the “6 minute abs and 7 minute abs” from There’s Something About Mary. “It’s dancing on the head of a pin really. A marginal difference,” he adds.
I offer Newmark an easy target – would he say Labour was the party for entrepreneurs?
He seizes the question - “Absolutely not! The mood music from Labour is to attack the rich, the entrepreneurs and anyone who is willing to take a risk with their own money”.
Would Newmark say the same for the other non-Tory party, the LibDems?
He tries to deadbat the question with a “they’re our partners and government policy is very much their policy”.
No doubt many LibDems would grit their teeth at the idea that their party now spouted “government” policy. I remind Newmark that the LibDem conference was full of slogans you wouldn’t see Tories spout like “fairer taxes for tougher times”.
If Newmark is suggesting that LibDem figures like businessman Lord Oakeshott were fully supportive of government policy (having attacked “incompetent” and “pitiful” government projects and the “tax-free funkhole” of London, who needs enemies?
At the mention of Lord Oakeshott, Newmark stays quiet for a good five seconds (I counted). Perhaps some tension given Newmark worked as a whip while Lord Oakeshott was a government treasury spokesman?
At last, he tells me:
“Lord Oakeshott is highly critical of his protégé Nick Clegg. Whatever comes out of his mouth is not particularly helpful, he has got a lot of anger issues that he needs to deal with”.
With Newmark’s experience, what does he have to say about the City of London?
He speaks sympathetically of “a series of errors, mistakes and bad things…by a few people at the top”. It wasn’t helped by a lack of understanding of what products were actually being sold, whether it be CLOs, CDOs or derivatives.
“Boards need to be much more educated about the products they sell,” he says, drawing on a meeting he had with a Bear Stearns board member who admitted not understanding what derivatives were.
Newmark goes on to link the reputation of bankers with politicians as he tells me:
“Historically, these have been respected characters, but we need to clean it up.”
“We all collectively need to earn that respect back!”
With a smile, he adds – “that’s a good line to end on I think!”
And with that, our chat draws to a close.
Perhaps the ex-whip Newmark has been like a political Derren Brown, guiding this conversation the whole time…