Behind its name suggesting a cool intellectualism, the European Research Group (ERG) is one of the most powerful lobby groups pressing for a hard Brexit, though its machinations are all but invisible to the public. Chaired by Jacob Rees-Mogg, it brings together right-wing Conservative MPs who wish to see Britain leave not just the EU but also the single market and customs union. It is possible that their real intention is to make the chaotic Brexit so beloved of disaster capitalists inevitable.
In February 2017, the ERG sent Prime Minister Theresa May a letter setting out a list of hard Brexit demands. Conservative MP Nicky Morgan commented ‘This isn’t a letter, it is a ransom note. The ERG clearly think they have the prime minister as their hostage.’
Her colleague Anna Soubry has been equally scathing about the bullying tactics of the ERG, saying: ‘It feels like – and I think there’s evidence to support this – Theresa is in hock to these 35 hard Brexiteers. They don’t represent my party, but more importantly they don’t represent people who voted leave.’ Sourbry goes further saying that Jacob Rees-Mogg is now ‘running our country’ with Theresa May no longer ‘in charge’.
The ERG does not publish membership details or annual accounts, so its exact membership is unknown, as are its sources of funding. The best list we have of alleged members has been provided by Buzzfeed, who number the group’s membership at 70. However, it is known that in the period leading up to the EU referendum, several members of ERG were prominent Vote Leave campaigners, including Michael Gove, Iain Duncan Smith, Liam Fox, Chris Grayling, Priti Patel and Andrea Leadsom.
A 2017 report by OpenDemocracy found that more than a quarter of a million pounds had been channelled into the ERG through MPs’ official expenses. OpenDemocracy questioned why taxpayers’ money was ‘being used to fund an influential group of hard-line pro-Brexit Conservative MPs who are increasingly operating as a “party-within-a-party”‘.
What little is known about the ERG’s other funding includes the fact that it has received donations from GR Software & Research Limited, whose parent company, Pans (UK) Holdings Limited, is registered in the British Virgin Islands (a tax haven). Benjamin Leadsom, husband of leading Brexiter Andrea Leadsom, was listed as a director of GR Software & Research Limited, along with his brother-in-law, the hedge fund manager Peter de Putron. De Putron’s financial activities have been described as being cloaked in a ‘labyrinthine off-shore company structure, which has made it impossible to ascertain who his clients are’.
Prior to Rees-Mogg taking over, the ERG was chaired by Steve Baker, who is also closely associated with the Legatum Institute and the Cobden Centre. Baker then moved to the Brexit department as a minister, later resigning when the Prime Minister’s Chequers compromise failed to match his extreme version of Brexit.
Baker’s own financial arrangements have also come under some scrutiny, after an investigation by OpenDemocracy revealed that he had ‘taken money from an arms company while promoting the aerospace industry in parliament; accepted travel costs from the government of Equatorial Guinea before writing a report dismissing concerns about their human rights abuses; and accepted conference expenses from radical right wing American groups with links to Robert Mercer and the Koch brothers’.
Baker’s register of interests also shows him to have taken £6,500 from the highly secretive Constitutional Research Council to pay for ‘hospitality’ at an ERG conference. The same shadowy organisation channelled£435,000 from an unknown source into the Brexit campaign via the Democratic Unionist Party.
In 2016 Baker was reported to the police and the Electoral Commission after an email he had sent was leaked to the Times. In it, Baker wrote: ‘It is open to the Vote Leave family to create separate legal entities, each of which could spend £700,000: Vote Leave will be able to spend as much money as is necessary to win the referendum.’ The subsequent publication of the investigation by the Electoral Commission indicates that Vote Leave appear to have taken Baker’s advice, and in doing so to have breached electoral law.
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