Unions have branded private equity chiefs as “arrogant” and “evasive” following their appearance before the Treasury Select Committee last week.
The power brokers were appearing before MPs as part of an ongoing investigation into whether the private equity industry ought to be more transparent and tightly regulated.
Critics of private equity deals have argued that they lead to huge job cuts and that the directors enjoy generous tax breaks.
Paul Maloney, national organiser for the AA section of the GMB union, told Personnel Today: “The equity chiefs got off lightly. They didn’t answer a single question without showing arrogance and evasiveness. Questions still remain unanswered.
“They effectively stuck two fingers up at the committee and continue to line their pockets with what are essentially tax-free payments,” Maloney said.
Paul Kenny, GMB general secretary, accused the firms of being short-term asset strippers and of axeing jobs. He said: “They are not in it for the long haul, they are in it for making money fast and they don’t care who gets hurt in the process.”
But all four businessmen denied the union allegations, insisting their industry created jobs. They argued their deals generated good returns for millions of individuals through their pension funds. Dominic Murphy, KKR managing partner, even said private equity was “a force for good”.
Jack Dromey, deputy general secretary of the super union Unite, told the committee that private equity firms were enjoying a tax loophole.
“It is to deny social responsibility to go from a public company to a world of private equity where you have people making fortunes in secret while the workers pay the price,” he said.
Dromey called for more transparency in future deals. “We have provided sufficient evidence to call for action, and what we now need is for the government to be on the side of the law, which should be changed,” he said.