Lib Dems Savage Slaughter & May's £22m Treasury Bill
The £22m credit-crunch related bill handed to the Treasury by Slaughter and May has been heavily criticised by the Lib Dems. The figures were released following a parliamentary question and showed that Slaughters was paid £22,150,000 for ‘financial stability related’ advice during 2008/09. Lord Oakeshott, the Lib Dem Treasury spokesman, said: ‘This payment is simply mind blowing. It comes to £175,000 for every single equity partner of the law firm. ‘How can the Treasury defend allowing the firm to run up …
The £22m credit-crunch related bill handed to the Treasury by Slaughter and May has been heavily criticised by the Lib Dems. The figures were released following a parliamentary question and showed that Slaughters was paid £22,150,000 for ‘financial stability related’ advice during 2008/09.
Lord Oakeshott, the Lib Dem Treasury spokesman, said: ‘This payment is simply mind blowing. It comes to £175,000 for every single equity partner of the law firm.
‘How can the Treasury defend allowing the firm to run up such an astronomical bill, the equivalent to 22,000 billable hours of partners’ time at £1,000 an hour.
‘Even if the financial crisis meant that there was no time to shop around at the start for the best legal deal, the Treasury should then have driven a much harder bargain, not left them like a fleet of legal taxis in Whitehall with their meters running for months on end.
‘The Treasury thinks they know it all, but they are babes in arms on commercial contracts.’
Also revealed in the figures were charges to other firms including Allen and Overy £713,000, Linklaters £225,000, Freshfields £41,000 and Clifford Chance £1,000 for making the tea advice they provided.
Although the bill might make the tax-paying public wince, Slaughter and May’s practice partner Paul Olney set out some justification in the Gazette : ‘We acknowledge it is a significant sum of money, but this covers work over a long period of time covering a range of projects including Northern Rock, bank bailouts and the collapse of Icelandic banks. In the context of the scale, novelty and difficulty of the work involved, and the period of time it covered, we do not consider the fees to be unreasonable. Indeed, we believe our competitors would have charged much more.’
June 25, 2009
Without a proper breakdown, it is really impossible to judge whether this is outrageous or totally reasonable but any angry public will no doubt lap it up anyway.
June 25, 2009
The public sector has made a fine cash cow in this economic crisis though.
June 25, 2009
“Making the tea”? Who edited this article? Bozo the Clown?
June 25, 2009
I expect the fees have been grossed up to take account of tax!
Would be interesting to see what Slaughters would do if the government just refused to pay. We should at least compare what was spent on the nationalisation of other banks by other governments.
June 25, 2009
I agree with the comment that it’s impossible to say without a breakdown. Don’t forget that this is taxable! HM Revenue & Customs will get the 15% back in VAT and also tax the LLP Corporation tax at 37% ? or otherwise when the Partners draw their income at 40 or maybe now 50% as to income tax. Once you take that into account, is it so bad? I should add – I’m no tax expert! A lot of people will have been making many personal sacrifices (not getting home, seeing kids etc.)
June 25, 2009
Given the results, it was great advice too!
June 25, 2009
And the partners still froze our salaries… On an unrelated point – could you please ensure to write “Slaughter and May”? We seriously do no like the “&”….
June 25, 2009
Get over it guys, seriously. It doesn’t make you sound like PR gurus or lawyers with amazing attention to detail – just like wankers.
On a separate note: can you please ensure you include the Angel logo before Freshfields Bruckhaus Deringer LLP’s name, whenever used? In the right shade of blue. Many thanks.