Conservative MP Michael Fallon has stood down as chairman of the remuneration committee of Tullett Prebon, the money broking firm offering to help its staff move to countries with more favourable tax regimes.
The company's website had named Fallon, a senior member of the parliamentary Treasury select committee, as chairman of the remuneration committee until about two weeks ago, though it is unclear when his role was changed. Until last night the website did not list him as having any role on the remuneration committee, although the company was expected to change this overnight to make it clear he is still a member. The committee is now chaired by fellow non-executive and former banker Rupert Robson.
Changing the chairman might be seen as helping to keep Fallon away from any direct criticism of the decision by Tullett Prebon to tell staff that it "will seek to facilitate, where possible and appropriate, relocation to the company's other offices around the world which have more certain taxation regimes". It followed last Wednesday's announcement of a 50% super tax on bonuses which has led to warnings that the City will endure a mass exodus of star financiers. The website lists Fallon, who joined the board in 2004, as a member of the audit and nominations committees.
Fallon is a highly respected member of the Treasury select committee, which has had a high profile role during the financial crisis . He is often described as a front-runner to replace its chairman, the Labour MP John McFall, if there is a change of government next year.
Lord Myners, the City minister, used a speech in London today to reassure financiers that the tax on bonuses over £25,000 was a one-off. "From the engagement I've had with the banking industry to date I'm fairly clear that it's not going to … be extended further. We've made it very clear it's a one-off tax," Myners stressed.
Bankers are scheduled to meet Treasury officials to discuss the implications of the tax and how it will work in practice. Earlier Myners had opened a debate in the House of Lords on the pre-budget report, telling peers that "these have been testing times".
A spokesman for Tullett Prebon told the Guardian this week that the decision to make it easier for staff to move abroad was not a political one and stressed that the company did not make political donations. Of the changing role for Fallon, the Tullett spokesman said: "The company periodically rotates the chairmen of its committees and on this occasion felt it was appropriate to do so, particularly bearing in mind that Michael Fallon has an election to fight in the new year and this gives him freedom to do so."