Dark Money Investigations

‘A corruption of Conservatism’: how a cartel of Tory MPs broke British politics

In an extract from his new book, Peter Geoghegan shows how the European Research Group became a tightly organised ‘party within a party’ that set the UK on course for a no-deal Brexit.

Peter Geoghegan
Peter Geoghegan
6 August 2020
'Morphed into a no deal sect'
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John Stillwell/PA Archive/PA Images

On a sweltering summer’s day in late June 2018, John Bolton arrived at a private meeting in London. There were no British officials to greet Donald Trump’s bellicose national security advisor, just a small delegation from what was fast becoming one of the most influential voices in British politics: the European Research Group of Conservative MPs. Leading the delegation was the one-time Tory party leader and former cabinet minister Iain Duncan Smith, who had first met his “good friend” Bolton more than a quarter of a century earlier.

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The Eurosceptic backbenchers were agitated. Theresa May was due to unveil her Brexit plans at Chequers a few days later. The ERG was worried that Britain might not leave the customs union and single market – which could severely limit any future free trade deals, not least with the US. Bolton asked, “Is there any way we can help?"

Over the course of an hour, Bolton reassured his British friends that Trump was an enthusiastic Brexit supporter. The president would soon prove his commitment publicly. Two weeks after the ERG’s meeting with Bolton, the US president caused a diplomatic incident during a visit to Britain when he told the Sun that May’s Chequers plans for a customs arrangement with the EU would “probably kill” a deal with the US. It was unusual for a president who so often showed little interest in the detail of major pieces of domestic legislation to take such a defined position on the prime minister’s proposal.

The ERG’s private discussion with John Bolton was not a one-off. A small group on the libertarian and Eurosceptic right of British politics has long looked to the US for inspiration. These transatlantic connections grew and strengthened rapidly, away from the public view, in the years before and after the EU referendum. A network of pro-Brexit politicians, journalists and lobbyists pushed for the UK to move away from European regulation, and towards the US. They deployed the same tools that had proved so successful inside the Beltway for decades: relentlessly on-message think-tanks and academics funded by corporate donors; well-organised ‘astroturf’ groups designed to look like grassroots supporters; and, crucially, small, highly-organised groups of influential politicians such as the ERG.

The ERG was taken over as an already existing vehicle. It morphed into a no-deal Brexit sect.

Guto Bebb, former Tory MP and ERG member

A few days after his meeting with Bolton, Iain Duncan Smith dismissed the conversation as a “friendly chat”. “Just because you’re in government doesn’t stop you talking with people you know and are friends with,” he told a BBC reporter. But over the following months, Duncan Smith and his colleagues in the ERG would show themselves to be increasingly capable of directing the British government. The ERG would eventually force May’s Brexit deal off the table and the prime minister out of office, and pave the way for Boris Johnson. They would, for a time, become one of the most influential forces in British politics.

This is the story of how a fringe Conservative party pressure group was transformed into a highly disciplined, secretive party within a party that changed the course of British politics – and how taxpayer money, anonymous private donations and a hidebound parliamentary system helped them do it.

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The European Research Group began in the imagination of an idealistic Oxford undergraduate. It was the spring of 1993 and Daniel Hannan was finishing a history degree at Oriel College. He was twenty-two and had a fondness for Aleister Crowley, the flamboyant occultist who once described democracy as an “imbecile and nauseating cult of weakness”. Hannan, who had been raised in Peru by British parents, had a different view of politics. In his view, Britons did not have enough control of their own affairs.

A few years earlier, he had set up a Eurosceptic student society called the Oxford Campaign for an Independent Britain. Hannan was particularly vexed by the Maastricht Bill that led to the creation of the European Union. In Oxford’s student union he quoted Aristotle, Shakespeare and William Pitt the Younger in tirades against deeper European integration. As his university days neared their end, he wrote to the 22 Conservative MPs who had rebelled against the Maastricht Bill the previous summer, including Bill Cash and Teddy Taylor. Hannan offered his services as a researcher. Around a dozen replied. The ERG was born, with Hannan as its first secretary.

The ERG was not the only Eurosceptic organisation to emerge on the margins of the Conservative party at that time. Traditionally, the Tories had been seen as the more pro-European of the UK’s two major parties. Ted Heath’s Conservative government brought the country into the then European Economic Community. Margaret Thatcher was an early, vigorous supporter of the common market at a time when many senior Labour figures were wary of a ‘capitalist club’ led from Brussels.

This changed through the 1980s as Labour began to embrace the vision of a ‘social Europe’. In September 1988, European Commission president Jacques Delors was given a standing ovation when he told delegates at the British Trades Union Congress in Bournemouth that Europe would guarantee workers’ rights.

Twelve days later, prime minister Margaret Thatcher offered a withering riposte. In a now famous address at the College of Europe in Bruges, Thatcher complained bitterly that she had “not successfully rolled back the frontiers of the state in Britain, only to see them reimposed at a European level with a European superstate exercising a new dominance from Brussels”. It was a watershed moment in British relations with the European project. A once vocally Europhile prime minister was turning her face against Brussels.

Shortly afterwards, a twenty-year-old Oxford drop-out named Patrick Robertson set up the Eurosceptic Bruges Group. By the middle of the 1990s, the Bruges Group’s membership would include more than 130 Tory MPs. Thatcher, by then out of office, was the first honorary president.

Opposition to Europe – and particularly the threat of federalism – was growing across the political right. In 1995, expatriate financier James Goldsmith set up the Referendum Party. Goldsmith had been a notorious corporate raider and bon vivant. During the 1970s, he often played poker with Lord Lucan, who would later vanish after killing his children’s nanny and trying to murder his wife, and spoke approvingly of a military coup to topple what he believed was a socialist conspiracy led by Harold Wilson’s Labour Party. Now the pugnacious tycoon put £20m of his own fortune into Eurosceptic politics.

In 1997, the self-explanatory Referendum Party ran almost 550 general election candidates on a single issue. (Future Conservative home secretary Priti Patel was press officer.) The party did badly but took Conservative votes in key seats. Most famously, Goldsmith himself ran against disgraced former Tory minister David Mellor in Putney. Mellor’s concession speech after losing his seat to Labour is worth watching on YouTube. He bellows at Goldsmith to “get back to Mexico knowing your attempt to buy the British political system has failed” while a wild-eyed Goldsmith grins maniacally and claps his hands, leading the crowd in a chant of “Out, Out, Out”.

Although Labour had swept into power with a thumping majority, Euroscepticism was stirring. Tory MP Zac Goldsmith, who inherited a £284 million fortune from his father, later described the Referendum Party as a “rebel army” of valiant Brexiters who saved the UK. Historians have pointed to the Referendum Party as a catalyst for UKIP’s later success.

The European Research Group, by contrast, was a far less showy affair. A dozen or so Tory MPs met regularly to discuss European affairs at breakfast meetings in the Attlee Room in the House of Commons. Guests included members of the Bruges Group, the libertarian pressure group the Freedom Association, and a young journalist named Michael Gove.

The first chairman was Tory MP Michael Spicer. Educated in Vienna and at Cambridge, Spicer had been removed as a minister in 1990 over his opposition to the Exchange Rate Mechanism. He believed that the EU was fundamentally undemocratic, later comparing it with China and Russia. The real driving force, however, was Hannan. At the time, he was sharing a flat in Soho with future Conservative and UKIP MP Mark Reckless. The pair hung a huge Union Jack over the fire escape and threw parties. Destiny was calling. “Don’t ever make the mistake of thinking Dan was a young fogey,” Douglas Carswell, who credited Hannan with converting him to Euroscepticism, told The Guardian. “This was a radicalised streak of thinking.”

Instead of radical Conservative change, British voters shifted to the pro-European New Labour. The challenge for the ERG and others became keeping the Eurosceptic debate alive. Hannan rallied around opposition to the proposed European single currency, which Tony Blair had praised. The ERG published a paper making the business case against the euro. Hannan helped set up the pressure group Business for Sterling to fight a widely expected referendum on joining the European currency – in the end, it never materialised.

Business for Sterling was in some ways a prototype for Vote Leave. Dominic Cummings was the director, and below him were many of the same staff and supporters. The anti-Euro campaign, however, also took pains to say it did not want to leave the EU. “I got involved initially in Business for Sterling,” one-time ERG member Guto Bebb told me. “I thought that Europe needed reform. I wanted a two-speed Europe, not Brexit.” In 2018, Bebb resigned as a Conservative minister to campaign for a second EU referendum.

In stark contrast to its very public presence in the years after the Brexit vote, the ERG flew almost entirely under the radar during Hannan’s tenure. Occasionally, its links with like-minded European movements did raise quizzical eyebrows. Jorg Haider, former leader of the far-right Austrian Freedom Party, claimed that he had been in frequent contact with the group during the mid-1990s. In 1998, Labour MP Andrew MacKinlay told the House of Commons that he had received a mysterious package to his Westminster office addressed to the treasurer of the European Research Group. Inside were one hundred cheques and a Midland Bank paying-in book for an account in the name of the Danish Referendum Campaign Account.

“Someone is running a fund-raising exercise from the House for that group, which could bring the House into disrepute,” said McKinlay. At the time, Hannan was running the ERG from Westminster. Two years later, the Danes rejected adopting the Euro in a referendum, by 53 per cent to 47.

By then, Hannan had stepped down from the European Research Group to become a Conservative member of the European Parliament. Hannan used his speaking time in the chamber to rail against the “illiberal” and “Bonapartist” European project. He had always maintained that the goal of the ERG was reform. “From day one it was conciliatory, the idea was to build a consensus around a looser relationship with the EU,” he later said.

A former colleague describes Hannan’s agenda as far more radical. “He wanted to take the institutions down from the inside,” says Edward McMillan-Scott, a former Conservative MEP who served alongside Hannan in Brussels and Strasbourg before defecting to the Liberal Democrats in 2010. “He used to say, ‘I don’t want to do anything but get out of the European Union, and if possible break the European Union up.’”

In the European Parliament, Hannan aligned himself with right-wing politicians opposed to immigration and regulation. (A parliamentary group he led was forced to return more than half a million euros after an investigation into its spending, which included a quarter of a million euros on a conference in Miami.) Hannan was particularly obsessed with restoring the sovereignty he believed had been lost to Brussels. He incessantly railed against the European Courts of Justice and the role of EU institutions in British life. When The Guardian published a long feature about Hannan in September 2016, the paper titled it ‘The man who brought you Brexit’.

Through the early 2000s, there was little sign that the ERG would become anything more than a recondite backbench outfit. With Hannan away in Brussels, and with domestic politics dominated by a stridently pro-EU Labour party, Eurosceptics struggled to get attention. The ERG was run by a succession of less distinctive characters, the most noteworthy of them being Matthew Glanville, future brother-in-law of the future chair Jacob Rees-Mogg. (Glanville’s wife, Annunziata, became a Brexit Party MEP in May 2019 before leaving Nigel Farage’s party to advocate a Conservative vote in the general election.)

Guto Bebb was introduced to the ERG by his friend, then ERG chair Chris Heaton-Harris, shortly after becoming an MP in 2010. At the time the group met around twice a term, often on the terrace at Westminster. “The European Research Group was exactly what it was. There was a lot of research,” recalls Bebb. “It was really good at going into detail of things like what was happening at the European Council. It was pretty nerdy. Which appealed to me.”

The group’s headcount hovered around 20 Conservative MPs and a handful of Eurosceptic peers. Members included a number of Tories who would later be branded as sell-outs for their opposition to a hard Brexit: John Bercow, Oliver Letwin, David Gauke. Their ethos was less ‘Brexit do or die’ and more ‘what do the latest reforms to the Common Agricultural Policy mean for British farming?’

Conservative Eurosceptics did have one notable success in these wilderness years: they convinced David Cameron to make his ill-fated pledge to give British voters a say on EU membership. Wary of the pressure from the increasingly organised right of his party, the prime minister’s 2015 general election manifesto committed to a referendum on Europe. When the Conservatives won an unpredicted majority, the ERG was ready. Bebb received a phone call from Heaton-Harris. His old friend asked if he would support a Leave vote. Bebb declined, and left the group. The ERG did not take a public position on Brexit, but it campaigned behind the scenes. Prominent members such as Michael Gove, Chris Grayling, Iain Duncan Smith and Liam Fox joined Vote Leave.

After the shock result, the ERG quickly changed shape, emerging as a vocal and highly organised opponent of a soft exit from the EU, pushing the Tory party ever further to the right and, eventually, toppling Theresa May. Its members started to appear frequently on television, listed as ERG spokespeople. Supporters such as Dominic Raab, Priti Patel and Jacob Rees-Mogg were given key cabinet roles. None had been involved with the group before the referendum, said Bebb. “The ERG was taken over as an already existing vehicle. It morphed into a no-deal Brexit sect.”

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If Daniel Hannan created the ERG, it was Conservative MP Steve Baker who moulded it into what The Economist has described as “the closest thing Britain has produced to sans-culottes”. Baker is easily underestimated. Slightly built, with a piercing stare and a keen eye for detail, the Conservative MP for Wycombe since 2010 can come across more like a zealot than a sharp political operator. He once said that the EU “needs to be wholly torn down”. But the former Royal Air Force engineer has a flair for organisation that would be the envy of any Leninist sect.

In September 2015, Baker led a successful rebellion over Prime Minister David Cameron’s proposals to loosen the strict ban on government institutions being involved in campaigning – known as ‘purdah’. What looked like a rather technical victory severely curtailed Cameron’s ability to use the machine of government to push pro-EU messages in the crucial final month before the referendum.

Baker is often said to possess an innate understanding of the concerns that motivate grassroots conservatives. “Steve Baker is very good at talking to the Conservative mind,” remarked veteran Eurosceptic Roland Smith. “If you feel you are one cog in a historical enterprise that is the United Kingdom, he completely taps into that.” Daniel Hannan’s old friend Mark Reckless privately described the ERG as “a backwater with little real influence on policy till the arrival of Steve Baker”.

Baker took over as ERG chairman in 2016. On his watch, it mushroomed from a talking shop with a dozen active members into a well-drilled political machine that could persuade as many as a hundred MPs to toe the line. “They have their own leader, their own whip, MPs are furnished with what to think and what to ask. Nothing is ever made public. They don’t even say who is a member and who isn’t,” says one source close to the inner workings of the group.

Baker reorganised the ERG into an inner core comprising a handful of MPs, Eurosceptic Tory MEP Syed Kamall, peers such as David Owen and Nigel Lawson, and trade lobbyist Shanker Singham. The steering committee, chaired by veteran Eurosceptic Tory MP Bernard Jenkin and aided by former cabinet ministers such as Owen Paterson and Theresa Villiers, met weekly in Iain Duncan Smith’s parliamentary office to plan strategy. Notes were never taken. A much wider group of ERG ‘supporters’ was organised through a very active WhatsApp group, incongruously titled ‘ERG DExEU/DIT Suppt Group’.

The ERG had one main aim: to ensure a hard, clean Brexit with minimal or no payments to Brussels, minimal reliance on EU judgments, and maximum flexibility to deregulate the British economy and sign free trade deals around the world.

The fervour with which Baker approached the task of leading the ERG mirrored other aspects of his life. He is a born-again Christian; baptised by full-body immersion off the coast of Cornwall, he has spoken of being guided by a higher power. He is also a committed disciple of the laissez-faire Austrian economics advocated by Thatcher and Reagan. Baker has called for the deregulation of carcinogenic white asbestos and has consistently argued for an end to the state’s involvement in the banking system.

“The bail-out of the banks incensed him as being a flagrant abuse of power by one class of people over another. This was a key motivation, in my opinion, for him to go into politics,” says Toby Baxendale, who first met Baker a few years before he became an MP and has remained close to him ever since. In the EU, Baker also saw “an elite political class enriching itself as the expense of the poorest”, Baxendale told me.

Baker keeps a silver coin in his breast pocket to remind him of what he believes to be an impending financial collapse, and has advocated a return to the gold standard. (After the EU referendum he invested £70,000 in a company that urged people to buy gold as ‘insurance’ against a no-deal Brexit. The firm later went into administration.) This faith in monetarism brought him into the orbit of dark money-funded US conservative groups. In 2015, American Principles in Action, bankrolled by the Koch brothers and hedge fund billionaire Robert Mercer, paid for Baker to attend a conference on global finance in Jackson Hole, Wyoming. A separate Koch-funded outfit picked up the tab for his attendance at similar events in the UK, Italy and the US.

Baker has also been a guest at the Antigua Forum in Guatemala. Billed as “the accelerator for freedom”, the invitation-only gathering has featured an unlikely smattering of libertarian-minded figures from around the world. Among those speaking alongside Baker were a former adviser to Vladimir Putin credited with implementing Russia’s flat income tax, an Ivorian politician close to the country’s notorious former president Laurent Gbagbo, and staff from British think-tanks such as the Adam Smith Institute and the Institute of Economic Affairs.

Baker was also a member of the Freedom Association. When writer and comedian David Baddiel described the Freedom Association, set up in the 1970s by right-wing Tories vehemently opposed to trade unions and Irish Republicanism, as a “slightly posher version of the BNP” in a radio interview in 2011, Baker wrote a letter of complaint to the BBC. The broadcaster apologised.

In the wake of the vote to leave the EU, Baker saw the ERG as a chance to shift Conservative Party policy from within. British politics has had pressure groups in its major parties for a long time. The Trotskyist Militant Tendency was a constant thorn in the side of Labour leaders before being purged in the 1980s. Alex Salmond was briefly expelled from the Scottish National Party for his membership of the 79 Group. The League of Empire Loyalists and the Monday Club kept a strain of imperial white supremacist nostalgia alive in the Conservative Party from the 1950s through the 1970s.

But rarely has a pressure group exerted as much influence on a governing party as the ERG. Conservative ministers and whips felt compelled to work with them. ERG members had advance notice of key decisions. The group was even given a private briefing before Theresa May delivered her key Lancaster House speech in January 2017, which committed her to leaving the European Union’s single market and customs union. It was Eurosceptic red meat. As the prime minister would soon discover, the ERG would accept nothing less substantial.

When May lost her majority in June 2017 and needed to soften her stance to have any hope of getting a Brexit deal through a divided parliament, she sought to pacify the ERG by bringing them into government. Steve Baker was made a junior minister in the Department for Exiting the European Union (DExEU). In January 2018, Suella Braverman, Baker’s nominal successor as ERG chair, joined him in the increasingly powerless Brexit department. The archly reactionary investment banker Jacob Rees-Mogg became the public face of the ERG. May and her whips hoped that ministerial baubles would placate the Eurosceptics.

The plan backfired completely. Baker showed scant regard for ministerial rules and conventions and continued to effectively lead the ERG from inside government, organising briefings for the group and attending meetings in the Commons that were not recorded in his ministerial diary. When this was exposed, Baker faced no sanction. Instead he resigned in July 2018, saying that he had been “blindsided” by May’s Chequers proposals that would have seen the UK remain in a customs arrangement with the EU, limiting the scope for free trade deals.

Baker was replaced in DExEU by another ERGer, Chris Heaton-Harris. A few months earlier, Heaton-Harris had written to every British university demanding lists of academics who were teaching about Brexit. Steve Baker was soon followed out the ministerial door by Braverman and fellow ERG supporter Dominic Raab. Both resigned in November 2018 in protest at the withdrawal agreement that May negotiated with Brussels, based on her Chequers proposals. Far from neutralising the ERG’s threat, May had increased the ERG’s standing.

“Chris Pincher and Julian Smith [Conservative whips] took the view that they could get the ERG to fall into line by bringing them into government,” says Bebb. “It simply didn’t work. It was a disaster.”

The ERG’s red line was trade. Trade had scarcely featured during the EU referendum, but in its aftermath it was often cited as the most compelling reason for Brexit. Britain had to be free to strike trade deals around the world. (The irony of leaving the world’s largest free trade block of near neighbours in the name of free trade with countries thousands of miles away was occasionally commented on.) As May’s withdrawal agreement, and the benighted Irish backstop, would have limited Britain’s ability to sign trade deals – particularly with the US – the ERG opposed it implacably.

Baker, Rees-Mogg and other senior ERG figures secured a vote of no confidence in the prime minister under Conservative Party rules in December 2018. Although May survived, the ERG effectively sank her withdrawal agreement. When Tory MP Anna Soubry resigned from the party in February 2019, she decried the ERG as “a party within a party” with “its own damaging agenda based on blind ideology”. One-time member Guto Bebb agrees. “I don’t think there was ever any intention to support May’s deal.”

The ERG’s fervent opposition – and tight whipping operation – ensured that May’s withdrawal agreement suffered two crushing defeats. The prime minister’s bill fell for a third time in March 2019, by 58 votes. Some senior ERG figures, including chair Jacob Rees-Mogg, did switch to support the government. But twenty-eight ERG members – the so-called ‘Spartans’ led by Baker – voted against, as did the group’s close colleagues in the Democratic Unionist Party. Had these pro-Brexit factions supported the prime minister, her deal would have gone through. May later announced her intention to resign and was replaced by Boris Johnson, a late convert to Brexit.

A party within a party, born in Daniel Hannan’s student digs, had brought down a Conservative prime minister and changed the course of Britain’s most significant peacetime policy. And it had achieved this thanks to a little-used Westminster convention that effectively allowed MPs to set up powerful caucuses funded by taxpayer money.

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Despite being formed in the early 1990s, the first time many people heard of the European Research Group was in early September 2017, when its then chair Suella Braverman appeared on Channel 4 News live from the lobby in the House of Commons. The ERG had started flexing its muscles publicly. The pressure group had circulated a letter warning Theresa May against signing a transitional deal with the EU that would keep the UK in the single market. Braverman, a junior government aide, trotted out familiar lines. “No deal is for sure better than a bad deal.” “Do justice to Brexit.” But then news anchor Krishnan Guru-Murthy changed the subject – to the ERG itself.

“Could you just explain to us what is the European Research Group,” Guru-Murthy asked, “because a lot of people are saying it is effectively a party within a party, it is a group of hardline Brexiters, some of whom are government ministers operating within the Conservative Party and taking public money, because a lot of you use public money to fund this group, the ERG.”

The inquisition seemed to catch Braverman off guard. Pressed about why the ERG’s membership was secret, the ERG chair said that she would “definitely provide” a list. None was ever published. Already people were starting to ask who were the members of the ERG, and why a partisan pressure group within Parliament was being underwritten by taxpayers.

Officially, the ERG is one of five parliamentary research services; the others are connected to the four largest political parties in the Commons: the Conservatives, Labour, the Scottish Nationalists and the Liberal Democrats. The ERG is funded by MPs paying an annual subscription of £2,000 each, which they claim as an expense. Writing on openDemocracy right before Braverman’s appearance on Channel 4 News, veteran lobby journalist Jim Cusick detailed how more than 50 Conservative MPs had claimed subscription money from their expenses for ERG membership. At £2,000 each a year, this works out at around £340,000 in taxpayer money between 2010 and 2018.

“The public purse has been underwriting the ERG’s so-called research for years,” says Cusick. “And for years nobody knew anything about it. It was hiding in plain sight.”

In theory, every time an MP claimed £2,000 from their expenses for an ERG subscription the information was publicly available. But it was veiled in secrecy. Many Tory MPs listed their ERG payments simply as “other pooled research” on their public record, rather than as donations to the European Research Group. “When I phoned Jacob Rees-Mogg’s office staff, they told me that he wasn’t a member of the ERG and he hadn’t contributed. Even though he was,” recalls Cusick.

The true extent of the ERG’s funding is likely to be far higher than a few hundred thousand pounds. Data for payments to the ERG only goes back to 2010, when MPs were forced to publish details of their spending for the first time in the wake of the expenses scandal. Prior to that, almost no information had been published about the ERG at all. The group also has a separate bank account for private donations.

Taxpayer funding was crucial to the ERG’s success. It paid for the staff that oversaw the group’s transition from talking shop to well-drilled political force. In June 2015, committed Brexit supporter Christopher Howarth, son of long-term ERG member and former Tory defence minister Gerald Howarth, joined as a researcher. His arrival coincided with a pronounced change in ERG message discipline. Research briefings started to look more like public relations than analysis. Members were fed with statistics that supported leaving the European Union.

Whereas previously the ERG met at the occasional breakfast briefing, now they were in continual contact. The constantly updated WhatsApp group provided briefings for its MPs before they did interviews, circulated links to members’ articles and coordinated responses to breaking events. After reviewing a tranche of ERG WhatsApp messages, Steven Barnett, a communications professor at the University of Westminster, told Buzzfeed that he had never seen a political movement “coordinated with such apparent dedication outside of an election campaign”.

Detail of the ERG’s private funding is scant, but occasionally some shards of information slip into the public domain. In 2014, the group’s then researcher Robert Broadhurst disclosed to Parliament that his salary was partly funded by private donations. One donor was Norman Lamont, the Eurosceptic former Chancellor of the Exchequer. Lamont, a member of the House of Lords, said that he remembered contributing “about £1,000” to Broadhurst’s pay. “I probably felt that it was wrong that I was not contributing, and MPs were,” he said.

Lord Lamont also noted how the ERG had changed after the 2016 referendum. Whereas before it had, he said, largely consisted of “having breakfast once a month and hearing from Robert Broadhurst, and making up our own minds” and did not have a “collective policy”, after the Brexit vote it became “more of a sort of campaigning thing”.

The strident Euroscepticism of the ERG’s post-referendum incarnation proved far more attractive to private donors. Paul Dyer, a pro-Brexit businessman, gave £10,000. The ERG also received cash from the Constitutional Research Council, the shadowy group behind the Democratic Unionist Party’s secretive £435,000 Brexit donation. In December 2016, the CRC gave £6,500 to then chair Steve Baker for an ERG Christmas party. It was the only other donation on record from the CRC.

By then, Baker’s Eurosceptic cadres had become increasingly close to key figures in the DUP. Nigel Dodds, the party’s Westminster leader, was a regular at ERG meetings. Former DUP Westminster chief of staff Christopher Montgomery joined the ERG as a researcher, alongside Howarth. Like Dodds, Montgomery was a former Vote Leave board member. He had a long-standing personal relationship with the CRC’s chair Richard Cook, who was also a member of the ERG’s WhatsApp group. In December 2018, as Theresa May struggled against Eurosceptic opposition to her withdrawal agreement, Cook applauded Baker’s “outstanding leadership of Brexit” in the WhatsApp group. Baker was “a superstar in a parliament with too many political pygmies!” the Scottish businessman wrote.

Private money allowed the ERG to broaden its horizons. The group commissioned expensive private polling and drafted alternative proposals for the Irish border. Front groups such as StandUp4Brexit – coordinated by staff who worked for former Vote Leave chief technology officer Thomas Borwick – gave the appearance of a groundswell of popular support on social media for key ERG policies. Other similar ‘astroturf’ campaigns sprung up opposing Chequers and May’s withdrawal agreement. The ERG was even reported to be working with CTF Partners, the public relations firm run by Australian spin doctor Lynton Crosby which ran the 2015 and 2017 Conservative general election campaigns, and which donated money and staff to Boris Johnson’s successful Tory leadership bid.

Just how much money the ERG raises from private donors is impossible to gauge. The European Research Group is an unincorporated association. Like Richard Cook’s similar Constitutional Research Council, it doesn’t have to publish accounts or list its members. This means it has been able to exert an outsized influence on British politics with very little oversight or transparency about where its money comes from.

The ERG does have two bank accounts – one for private donations, the other for public funds. Asked about this arrangement in 2018, then chair Jacob Rees-Mogg said: “The research is publicly funded, but everything else isn’t and we’ve always been very careful to differentiate and make sure anything that isn’t justifiably a public and parliamentary expense is dealt with separately.”

Westminster has a regulator that oversees how taxpayer-funded parliamentary groups like the ERG operate. But the watchdog seems to take a very curious view of what the public should be told about how its money is spent.

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In January 2018, Jenna Corderoy, my colleague at openDemocracy, wrote an email to the Independent Parliamentary Standards Authority (IPSA). Citing the Freedom of Information Act, Corderoy asked the parliamentary watchdog for copies of research submitted to it by the ERG. IPSA had been set up in a hurry in 2009, as the MPs expenses scandal rocked Westminster. Amid a seemingly endless drip feed of stories about taxpayer-funded second homes and bath plugs charged to the public purse, the Labour government announced that it was establishing a watchdog to monitor MPs’ spending. For the first time, expenses would be scrutinised and published. Part of the remit of the Independent Parliamentary Standards Authority was to oversee research services funded by MPs’ expenses – like the European Research Group.

For years, IPSA had taken a very light-touch approach to the ERG. It asked few, if any, questions. In 2017, however, as press attention intensified on the ERG’s increasingly public Brexit lobbying, the regulator wrote to the group saying that it wanted reassurance that public money was not being misspent on party political campaigning. In response, the ERG sent the regulator samples of its publicly-funded research output.

Although Freedom of Information is often used by journalists, the law allows anyone to request information from a public body. A decent rule of thumb for FOI is that if the information has been paid for by taxpayers, then you should have a right to access it. The parliamentary watchdog took a different view. Releasing the documents could damage its relationship with the group, IPSA said in response to the request.

Corderoy, one of Britain’s most experienced FOI journalists, was undeterred. She appealed to the Information Commissioner’s Office, whose job it is to adjudicate on access to information. The timid regulator upheld the original judgement that research funded by taxpayer money should stay private. She appealed once again.

In early May 2019, Corderoy walked into a drab information rights tribunal in central London. She was twenty-nine and was representing herself against lawyers for both the parliamentary and information regulators. Corderoy, sporting a pair of shiny Doc Martens, was the only one not in a suit. She had spent months fighting the case in her spare time, reading previous judgements, constructing skeleton arguments. She told the court that the public must have access to the ERG’s research “in order to understand what kind of research these MPs have relied upon to mould their views on Brexit. And for history’s sake, we must be able to access these materials to understand how we have got to the point where a no-deal Brexit is a very real possibility.” The judges agreed.

Hundreds of ERG briefings were released. Most were quite short and read more like talking points than research. There were lines for MPs to take on key Brexit issues. ERG notes frequently accused the Conservative government – of which the ERG’s MPs were members – of failing to “address the positives” and “distorting statistics”. Reports by business groups were dismissed as false forecasts. Post-Brexit job losses should be described as jobs that would no longer be needed for EU migrants. IPSA had found that one briefing – which attacked the Labour Party for voting against a Brexit bill – had crossed the line into party politics, but on the whole the ERG’s output was, the regulator said, “factual and informative”.

Independent trade experts came to a very different conclusion. The ERG’s research was “superficial and selective”, said former UK trade official David Henig. The British taxpayer had spent a small fortune underwriting a highly political party within a party, and the regulator had fought tooth and nail to prevent any of its work from being released to the public.

It had taken Corderoy a year and a half and countless hours of work to force Parliament’s putative watchdog to hand over basic information. Her experience is far from unique. British government departments refuse to comply in full with more than half the Freedom of Information requests that they receive. The new Brexit departments created by Theresa May in 2016 are among the worst offenders.

I have lost count of the number of times I have asked for documents from ministerial meetings, only to be told that none exist. No minutes were taken. No notes were kept. Increasingly, there is no paper trail for crucial decisions.

Laws supposed to make government more open have had the opposite effect. Supposedly publicly accessible information, such as the register of MPs’ interests, is so poorly presented as to be almost unusable. Freedom of Information, the transparency legislation that led to the MPs’ expenses scandal, “doesn’t work properly”, transparency campaigner Tamasin Cave told me. Government departments routinely obfuscate. Regulators err on taking the side of institutions, not the public. “The system is broken and nobody intends to fix it,” said Cave. “In all the windows of government, the curtains have been closed.”

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Politically, the ERG often found itself outmanoeuvred in the years after the EU referendum. The attempt to unseat May in late 2018 was a tactical disaster, at least initially. The group’s epitaph was written countless times. Yet when Boris Johnson unveiled his first cabinet in July 2019, it was well represented. Dominic Raab was back, this time as foreign secretary. Priti Patel was given the key home office role. Jacob Rees-Mogg became leader of the House of Commons. Steve Baker took up the chair of the ERG again, a role he had never really left. Johnson’s strident determination to leave the European Union “do or die” could have come from a taxpayer-funded ERG briefing note.

The success of the ERG demonstrates how a small, disciplined pressure group can pull British politics in directions that would have been unimaginable a few years earlier. The parliamentary convention for funding pooled research services provided an ideal vehicle for a committed band of ideologues, with the public picking up the tab. Anonymous private funding and a constant stream of WhatsApp messages helped the ERG push their agenda even more effectively. Without all this, Britain would almost certainly have left the European Union in March 2019 with the deal negotiated by Theresa May.

So why was the ERG so opposed to her deal? The group’s motivations were often discussed on late-night talk shows and in the pages of political magazines. Sovereignty. Identity. A dash of xenophobic Little Englandism. But when I asked former member Guto Bebb what drove the ERG, he gave me a one-word answer: “Deregulation.” Theresa May’s agreement would have bound the UK to continental standards that many in the ERG wanted to see loosened.

In October 2019, the ERG conspicuously backed Boris Johnson’s Withdrawal Agreement. The hastily rewritten text was almost a carbon copy of May’s, except in one crucial respect: by acquiescing to bespoke arrangements for Northern Ireland, it would leave Britain free to sign trade deals around the world. The ERG had thrown the DUP, their former comrades, under the bus. “I would ask the DUP to accept this compromise,” Steve Baker pleaded on BBC Radio 4. The DUP said: “Never.”

Johnson’s deal kept alive the ERG’s vision of a deregulated ‘Global Britain’. Daniel Hannan frequently talked of post-Brexit Britain imitating Singapore’s low-tax, low-regulation economy. “The ERG is Singapore on steroids,” says Guto Bebb, adding that many in the group were “climate change deniers” who “were quite happy to see Trump win”.

Another Tory MP, Tom Tugendhat, described the ERG as the antithesis of British Conservativism: “It’s a corruption of Conservatism. It is rampant libertarianism. It’s the very opposite of what it means to be a Conservative.”

Tugendhat’s point is a crucial one. The ERG did not just provide a home for fervent Brexiters; it was also the first really cohesive pressure group inside the Commons since Thatcher that strongly identified with US libertarianism. During the long years of arguing over Brexit, the ERG was the most vocal proponent of prioritising a trade deal with the US. ERG top brass frequently travelled across the US, spreading their message to receptive audiences. Jacob Rees-Mogg met with Steve Bannon to discuss how conservative movements could win in both countries. As hardline Republican caucuses had done on Capitol Hill, the ERG had successfully used the machinery of British party politics and funding to radically change the country.

The European Research Group has largely retreated from public view in recent months. Boris Johnson’s ‘stonking’ general election victory meant that the ERG no longer held the balance of power in Parliament. Instead, the ERG had become part of the Conservative mainstream. From being a clandestine cadre on the backbenches, the ERG started publishing group photos. Steve Baker returned as leader, then handed over the reins to Mark Francois. ERG members continued to issue broadsides against perceived backsliding on Brexit, but have remained faithful to Johnson.

Daniel Hannan, however, has emerged as one of the most vocal critics of the government’s COVID-19 strategy. In mid-February, as the virus was taking hold in Italy, Hannan tweeted that “the coronavirus isn't going to kill you. It really isn't.”. The father of the ERG was widely expected to be ennobled by Boris Johnson. But when the prime minister’s dissolution honours list was published in late July, Hannan’s name was missing. No official explanation was given.


This piece is taken from Peter Geoghegan's 'Democracy for Sale: Dark Money and Dirty Politics', published by Head of Zeus.

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