Dozens of MPs have called for a parliamentary inquiry into allegations of insider trading surrounding Kwasi Kwarteng’s budget.
In a letter to Treasury select committee chairman Mel Stride, the 31 MPs said the chancellor’s contact with financial traders in the run-up to the policy change should be reviewed “without delay”.
Mr Kwarteng is reported to have met privately with at least one trader who profited from the fall in the value of the pound in the weeks leading up to the budget.
He also admitted attending a private party for financiers just hours before he delivered his speech to the House of Commons, where he was allegedly “pushed on” by hedge fund managers.
The MPs said any “suggestion or suspicion of private individuals using privileged access to profit from our country’s economic difficulties must be fully investigated”.
Signatories to the letter include Dame Margaret Hodge, who is the former chair of the Public Accounts Committee, and John McDonnell, the former shadow chancellor.
“As Members of Parliament and civil servants for our constituents, we are writing to request that, as Chair of the Treasury Select Committee, you use your full powers to investigate allegations of insider trading prior to the recent value crash per pound against the US dollar,” the 31 Labor backbenchers said.
They added: “Any suggestion or suspicion of private individuals using privileged access to profit from our country’s economic difficulties must be fully investigated.” Our voters are already deeply angry that financial traders are enriching their personal fortunes by betting against Britain. Any political assistance received in this process would be unacceptable.
“We are therefore calling on you to immediately launch a Treasury Select Committee investigation into all contacts between the Chancellor of the Exchequer, the Prime Minister and financial traders in recent weeks. Transparency is desperately needed.”
Mr Kwarteng’s budget included tens of billions of pounds in unfunded tax cuts, prompting an immediate plunge in the value of the pound and a spike in government debt yields.
The unusually sharp market moves left plenty of room for traders to profit by shorting sterling, but also caused significant financial volatility – eroding the asset base of pension funds.
Interest rates are expected to rise to 6 per cent as a result of the policies, despite a partial reversal by Mr Kwarteng and Liz Truss on scrapping the top tax rate.
Before entering politics, Mr Kwarteng worked as a financial analyst in the City as well as for a hedge fund.
Labor MP Carl Turner, one of the letter’s signatories, told The Independent that the budget allegations were “incredibly serious”.
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