Controversial Lib Dem peerage

Yesterday’s Sunday Times reported that one of the Liberal Democrat nominations on the forthcoming list of new life peers is millionaire businessman Rumi Verjee.

(The Sunday Times story is hidden behind a paywall but you can read a summary on the Indian news website ZeeNews.com).

Of course, no one outside the leader’s office – not even Sunday Times journalists – knows who is on the list. The list may not yet have been finalised. But that has not stopped the criticism.

Critics of Verjee’s nomination have raised three issues. The first is one faced by any wealthy donor receiving an honour. Verjee (through his company Brompton Capital Limited) has made donations to the Liberal Democrats totalling £775,000 since May 2010, which has led to predictable if unfounded allegations by a Labour MP. Second, at the Labour Party’s request, the Electoral Commission is examining whether these donations are “impermissible”, although Verjee and the party are likely to be cleared of any wrongdoing. And third, it has been suggested that Verjee’s offshore business interests are at odds with recent statements by leading Liberal Democrat ministers critical of offshore operations.

Provided the Electoral Commission gives the all-clear, no laws have been broken, and much of the controversy is the product of Labour’s muckraking (in an area where a certain phrase about pots and kettles springs to mind). The question of policy on offshore interests is one for the leader to answer, not Verjee.

The fundamental problem is not Verjee’s wealth or business affairs. Rather, this sort of controversy, even if unfair, underlines the problem of having a legislature (the House of Lords) that is nominated rather than elected. If there is any fault, it belongs to the system of patronage and the politicians who uphold it.