Home maker: Michael Howard with his wife Sandra, who was adept at doing up ‘wrecks’
Former Conservative party leader Michael Howard says he would be much better off financially if he had never gone into politics.
Lord Howard tells Donna Ferguson that he earned twice as much as a barrister than he did as a politician.
He cut crime by 18 per cent as Home Secretary in John Major’s government and says he didn’t go into politics for the money, but to make a difference and improve the lives of others.
He became a Conservative life peer, Baron Howard of Lympne, in 2010.
Now 82, he and his wife Sandra, 83, live in a six-bedroom house overlooking Romney Marsh in Kent. They also own a two-bedroom flat in Pimlico, Central London. They have two adult children together, Nick and Larissa, and stepson Sholto.
What did your parents teach you about money?
They told me not to get into debt, which was pretty sound advice that on the whole, I’ve more or less kept to.
My parents were shopkeepers. They mostly sold ladies’ fashionwear. They were entrepreneurial in a modest kind of way.
We were reasonably comfortably off, but we certainly weren’t rich. I went to state schools – a local primary school, and then Llanelli grammar school. Money wasn’t talked about that much. They talked about the business a bit but not their personal finances.
Growing up, money wasn’t something I thought about a lot. But I was aware that quite a lot of people were quite hard up and that some people were quite wealthy.
Have you ever struggled to make ends meet?
When I first went into politics at the age of 41 I suffered a very sharp fall in income, particularly when I became a Junior Minister in 1985 after earning quite a bit as a barrister.
You pay income tax in arrears as a barrister, and so I had to pay the tax bill for my relatively large barrister’s income out of my relatively small Ministerial income.
What I should have done, when I was working as a barrister, was to set aside the money to pay the taxman. But of course, I thought I was going to be doing well the following year and so could pay the tax out of that year’s income. It is only when you suffer a sharp drop in income that it becomes difficult.
We solved this problem because my wife Sandra is happily very good at doing up houses. We would move quite a lot into a wreck, live in the wreck while she did it up and then sell it and buy another wreck. We did that, I think, three times between 1985 and 1995.
It was a challenging time. I don’t know quite what we would have done if Sandra hadn’t been able to do up these houses.
Why did you go into politics?
It certainly wasn’t for the money. I probably earned double my MP’s salary as a barrister.
I’d be much better off today if I’d never gone into politics at all and had stayed as a barrister.
It was 1983 when I got into the House of Commons. I had wanted to go into politics for a long time. It’s a cliche, but most people who do so – whichever side of the political divide they are on – want to make a difference. You think you can make things better for people. Although obviously there are very different views as to how you might achieve that.
I do feel like I did make a difference – I think some people would disagree – but I think I did.
For example, I remember being told as Home Secretary there wasn’t anything I could do about the rise in crime. I didn’t accept that advice and in 1997, at the end of my four years as Home Secretary, nearly a million fewer crimes a year were being committed. It was very hard work. We encountered a huge amount of opposition and it was a constant struggle – but at the end of it, there was an 18 per cent fall in crime. So I certainly feel I made an impact there.
What is the most expensive thing you bought for fun?
My car was stolen a few weeks ago, a grey Prius, with everything in it while parked in Central London as we were at a friend’s party. I’ve just bought another car, which is the most expensive thing I’ve ever bought, apart from houses. It’s nothing terribly racy, it’s a used Lexus – a grey one. It cost me several thousand pounds.
What is your biggest money mistake?
Selling our home in Central London to buy our home in my constituency in Kent in 1994. If I had been prepared to borrow more to buy in Kent, and kept the house we had in London, that would have been a very good move. House prices shot up after that, particularly in Central London. I made the mistake of being cautious.
The best money decision you have made?
Buying a bachelor flat opposite the river in Chelsea when I was 29. It was a very good investment. If you can manage to get on the housing ladder when you are young, I think it’s a very sensible thing to do.
Esteemed company: Lord Howard with Lady Thatcher in 1994
Do you save into a pension?
Not anymore but I did when I was a barrister and when I was an MP. Now, I receive my parliamentary pension. I haven’t touched the one I saved into as a barrister yet.
I’m sure I will have to, pretty soon. I think it’s important to save into one. I started mine when I was in my 30s and I’m horrified by the number of people who think it’s unimportant. Many think they can’t afford the payments. Others are prioritising getting on the housing ladder. But if you leave it too late, it becomes much more difficult to build up enough of a pension that will enable you to have a comfortable retirement.
Do you invest directly in the stock market?
Yes, via stocks and shares ISAs, with mixed results. I pick the stocks myself and that’s probably the trouble! I’ve had some good experiences but I probably take too many risks. I like investing in smaller British companies in the hope that they can grow and do well. Sometimes they do – and sometimes they don’t. I try not to dwell on it.
Do you own any property?
We have a small two-bedroom flat in Pimlico and a rather ugly six-bedroom house in Kent in a wonderful position that overlooks Romney Marsh and the Channel. I absolutely love it. It’s the only house I’ve ever lived in to which I have been emotionally attached. I have no idea what it’s worth.
The one little luxury you treat yourself to?
A holiday, almost every year, to the island of Grenada in the Caribbean, for ten days or a fortnight, with my wife. It probably costs us a few thousand pounds, including the fare. We always stay in the same hotel, usually in the same room, near a fantastic beach. We love the people there.
If you were Chancellor, what would you do?
Try to ease the tax on businesses, especially small ones. If businesses do well and prosper, there are more jobs and more wealth in the country, and we’re all better off.
Do you donate money to charity?
I am the vice president of Hospice UK, which I chaired for eight years. I donate both my time and my money – I think hospices do a wonderful job and it’s always been a privilege to be associated with the hospice movement.
What is your number one financial priority?
To have enough money to pay for care if my wife and I need it, without calling on my children for help.
- Michael Howard is a supporter of Hospice UK, the national charity for hospice and end of life care, which works to ensure everyone affected by death, dying and bereavement gets the care and support they need.
