MPs angered by need to disclose losses: Lloyd's names deplore change in rules (CORRECTED)

CORRECTION (PUBLISHED 20 JANUARY 1994) APPENDED TO THIS ARTICLE

THE EXTENT of losses by Tory MPs who are Lloyd's underwriters will be disclosed for the first time next month as a result of changes to rules covering the Commons directory of members' interests.

The losses, running into six figures for several MPs, are causing the Lloyd's 'names' at Westminster extreme concern, and they are angry at being forced to disclose their financial affairs. Some fear that their predicament will be worsened by claims from Monday's earthquake in California.

For some years, MPs have been required to list their membership of Lloyd's in the register but, for the first time, they are being asked to disclose the name of their syndicate and whether it was an 'open' year, which means they face unlimited losses for that year.

Some of the names are furious that the information will allow accurate estimates to be made of their personal losses. Sir Geoffrey Johnson-Smith, Tory chairman of the Commons members' interests committee, said: 'It will be a nice exercise for the Labour research department on a wet afternoon.' Sir Geoffrey, a name who is facing a six-figure loss, added: 'Not many MPs can stand losses of pounds 100,000 a year for a number of years.'

James Pawsey, the Tory MP for Rugby and Kenilworth, a member of the Merritt 418 Syndicate (1985), which is facing open losses, said that 'a considerable number' of MPs were involved. The Merritt action group has already rejected the Lloyd's settlement offer, which set the losses at 525 per cent of the investment. A name investing the average 'line' of pounds 25,000 in the syndicate would face losses of pounds 131,000.

Mr Pawsey wrote to six Tory colleagues who are names to discuss the losses, including David Faber, Roger Knapman, Richard Shepherd and Phillip Oppenheim, parliamentary aide to Kenneth Clarke, the Chancellor. Not all are members of the heavily-criticised 418 syndicate, which sustained losses over asbestos claims in the United States.

Although the losses are unlikely to lead to any MPs being disqualified by being made bankrupt, some members are facing continuing financial embarrassment. About 23 Tory MPs are Lloyd's names, including two Cabinet ministers, Peter Brooke and David Hunt, and Sir Norman Fowler, the Tory party chairman. Ian Lang, Secretary of State for Scotland, ceased to be an underwriter in 1990.

Those Tory names facing heavy losses are believed to have informed the whips' office about the extent of their private financial difficulties. There are also rumours at Westminster that some may seek help if necessary through the party network.

CORRECTION

Owing to an error in editing, remarks were wrongly attributed to Sir Geoffrey Johnson Smith, Conservative MP for Wealden, in yesterday's Independent. As a result, it was also wrongly said that Sir Geoffrey was a name at Lloyd's and that he was facing losses in six figures. This referred to another MP. We would like to apologise to Sir Geoffrey.