Private equity: sleeps with the fishes

Union boss Jack Dromey isn’t exactly the biggest fan of private equity. But comparing a bunch of ex-investment bankers and management consultants to Europe’s most notorious criminal organisation might be pushing it a bit.

Last Updated: 31 Aug 2010

In a TUC debate on private equity this morning, Dromey told delegates that the industry ‘makes the Cosa Nostra look like a model of openness and transparency by comparison’.

And he wasn’t finished there: ‘They take our members’ jobs, they pile our companies with debt, they fleece all of us by not paying their fair share of tax and then expect us to be grateful’.

Dromey is a well-known figure on the left of the Labour Party – he has been deputy general secretary of the Transport and General Workers Union since 2003 (after getting trounced in the election by Tony Woodley), and is also the husband of Harriet Harman, Labour’s newly-elected deputy leader.

And he is no stranger to intrigue himself. In 2006, he was forced to deny all knowledge of the £3.5bn loans that sparked the cash-for-peerages scandal – despite being Labour Party treasurer at the time.

The mafia comparison is Dromey’s favourite witticism – he also used it at the Treasury Select Committee hearing on the industry in June, when he told politicians: “Until the [recent union] campaign, more was known about the Cosa Nostra than private equity.” (It was just as good the second time around, though)

But the question is: with private’s equity public reputation in tatters, who is more likely to be more offended by the comparison? If Dromey is not careful, he and Harman might be waking up next to a horse’s head before they know it...

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