Bayo Alaba, the Labour MP for Southend East & Rochford, has been suspended from the parliamentary party after referring himself for investigation over government Covid loans taken out by his businesses. The suspension follows questions from the Times about a bounceback loan issued to one of his companies during the pandemic, prompting Labour to launch an internal inquiry.
Background and Loan Details
Alaba, who became an MP in 2024, previously ran several businesses, including Alaba Properties Ltd. According to the Times, accounts for Alaba Properties Ltd indicate it took out a bounceback loan, though the exact amount has not been disclosed. Companies House records show two attempts to wind up the company in 2022, both of which were blocked. Such wind-up applications are only permitted when a company has no outstanding debts, raising questions about the company's financial status at the time.
The objections process that blocked the wind-up attempts was introduced by the Department for Business to address misuse of bounceback loans, specifically targeting business owners who tried to avoid repayment by striking off their companies. It remains unclear who intervened to block the wind-up, but the process was designed to prevent such avoidance tactics.
Alaba's Response and Party Action
Alaba has confirmed that he took out two bounceback loans and is now repaying them, according to the Times. However, he did not answer questions about why he attempted to wind up Alaba Properties Ltd or whether his companies were eligible for the loans. In a statement, Alaba said: “Like many businesses and entrepreneurs, I accessed financial support during the Covid-19 pandemic. I am wholeheartedly committed to ensuring that the liability is met in full. I’ve referred myself to the Labour party’s investigations process on the matter and I’ll cooperate fully.”
A Labour spokesperson confirmed that Alaba had referred the matter to the party, which would investigate. The spokesperson added: “The Labour party expects the highest standards from our elected representatives and we have robust processes in place to ensure those high standards are upheld. We cannot comment further while the investigation is ongoing.”
Political Reactions and Next Steps
Mike Wood, the shadow Cabinet Office minister, commented: “Alaba needs to come clean about whether he tried to avoid paying his debts, and ministers should tell us if they had to intervene to stop it. The public deserve the truth.” The investigation is ongoing, and the outcome could affect Alaba's parliamentary status and the Labour party's standing on financial integrity.
