How Britain’s political elite broke the development bargain

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I’ve begun writing a book on British corruption — the growing propensity of politicians to monetise their office. I’m reading investigative journalism, parliamentary reports and wonk treatises, and interviewing everyone from party donors to spies. Yet I’ve learnt most from a book that isn’t about the UK at all. Gambling on Development by Stefan Dercon focuses on much poorer countries. But reading about ruling elites who loot their states, I kept seeing parallels with today’s Britain.

First, a caveat: the UK remains cleaner than most countries. It has almost no petty corruption. Teachers, doctors and civil servants don’t take bribes, for instance. But the world’s first developing country is now “undeveloping”, with real wages lower and many public services worse than in 2006. And I know immigrants to Britain from countries such as Nigeria or Russia who nod with recognition at recent stories of elite self-dealing: the Conservative peer Michelle Mone, who lied about her relationship with a medical equipment company that won more than £200mn in state contracts during the pandemic; David Cameron, now foreign secretary, who lobbied to get state-backed loans for the since-collapsed Greensill Capital; Boris Johnson’s catalogue of scandals.

Dercon argues that a country tends to develop once its elite strikes a “development bargain”. This entails the haves deciding they want national development, instead of just dividing goodies among themselves. Autocracies can strike development bargains and so can democracies. What matters is the elite’s choice to develop. Examples of development bargains are China from 1979, India from 1991 and Ethiopia until the recent civil war.

Britain’s development bargain has broken down. The ruling Conservatives learnt from four straight election victories that voters would back them no matter what. Meanwhile, the party lost its common project. Some Conservatives never believed in Brexit, some quietly stopped believing and for some it’s a quasi-religious cause, not reasoned economics. Some Tories are liberals, some far-right and others the sort of grifters who attach themselves to any long-term ruling party (see South Africa’s African National Congress). Tories call for low taxes but have imposed Britain’s highest tax burden since the second world war.

When a common project dies, what remains is self-advancement. The British case study was the “Covid VIP lane” of 2020, in which well-connected Tories such as Mone benefited from uncontested government contracts to supply personal protective equipment that often didn’t work. Dercon tells a similar story from Sierra Leone’s 2014-16 Ebola outbreak: “Whenever he could, the president had awarded all Ebola-related contracts to a small network of businessmen . . . allegedly with close connections to the president’s All People’s Congress government.”

Self-dealing elites target their country’s main natural resource: oil in Nigeria, the wealth of top-end London in the UK. They forever promise to diversify the economy away from the natural resource, but somehow this never happens.

London now has two distinct elites — one, in Mayfair and the City, of private affluence, and the other, at Westminster, of public squalor. Predictably, the one has begun buying the other, chiefly through donations to the Tory party, up three- or fourfold in real terms from 2001 to 2019. Take Johnson. As prime minister, he celebrated his wedding at the Cotswolds estate of Tory donor Anthony Bamford and, after leaving Downing Street, lived for months in a £20mn Knightsbridge property belonging to Bamford’s wife, paying only a concessionary rent. (There is no suggestion of wrongdoing by the Bamfords.)

Britain’s wealth-power nexus remains under-scrutinised. Tory donors are less well known than some irrelevant MPs. Andrew Feinstein, a former ANC MP who runs Shadow World Investigations, says: “In South Africa, in a township, people can discuss details of corruption deals at seminar level. Britons have only a vague sense of what happened with the Covid VIP lane, and so on.”

This is finally changing. In a December poll by WeThink for Byline Times, just 1 per cent of respondents described Britain’s government as “very honest”. Record numbers of Britons say that politicians are “out for themselves”. The Tories will probably finally lose power this year.

A ruling elite often strikes a development bargain when misrule threatens its legitimacy. China’s Communist party did after Mao’s death. Britain’s elite may be getting there.

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