POLITICS
22/05/2014 13:44 BST | Updated 22/05/2014 13:59 BST

Esther McVey Slammed For Taking Money From High-Cost Loan Boss

LEON NEAL via Getty Images
Former Minister for the Disabled Esther McVey poses for pictures outside 10 Downing Street in London, on October 7, 2013. McVey replaces Mark Hoban as Employment Minister as a government reshuffle began Monday. AFP PHOTO/Leon Neal (Photo credit should read LEON NEAL/AFP/Getty Images)

Employment minister Esther McVey has come under fire for accepting a £10,000 donation from the millionaire boss of a high-cost loan company that gives loans to people with poor credit ratings.

The Tory MP for Wirral West's constituency party received £10,000 from Henry Angest, head of the Arbuthnot Banking Group, which owns Everyday Loans, a firm that provides unsecured loans at annual interest rates of nearly 80%.

The rates are higher than those available to people in secured loans, but not as high as payday lenders like Wonga, whose APR (annual percentage rate) can be as high as 5853%.

Critics seized on the high-cost lender boss' donation to McVey due to her ministry, the Department for Work and Pensions, slashing benefits.

Labour MP Paul Flynn, member of the Public Accounts Committee, told the Daily Mail: "At the same time as working in a department which is being harsh and ruthless to people with tiny incomes, she is accepting money from someone in charge of a company exploiting the weakness of the most vulnerable.

"No politician should appear to be in hock to any donor, because it gives the impression that any decision taken is influenced by sponsorship."

Angest, chairman and chief executive of Arbuthnot Banking Group, has been a major Tory party donor, giving the party £7 million in loans and donations over the last decade. According to the Electoral Commission, he gave the party £17,500 in the first quarter of 2014.

Speaking to the Liverpool Echo, McVey defended her decision to accept the money by stressing that the Angest made the donation as an individual.

"This is a bank – and a bank that did not need a bailout from the taxpayer. And the donation came from an individual who is the chief executive officer of the bank, not through any company at all," she said.

An Arbuthnot Banking Group spokesman said: "This was a personal donation and is completely above board."