Sir Vince Cable admits to ME & MY MONEY some of his early financial decisions left a lot to be desired

Sir Vince Cable was leader of the Liberal Democrats from 2017-19, and the Secretary of State for Business in the Conservative-Lib Dem coalition government of 2010-15, writes York Membery. 

Born and raised in York, the 80-year-old was an economic adviser to the Kenyan government and the Commonwealth Secretariat, and later chief economist at Shell, before going into politics. 

The father of three lives in Twickenham, South-West London, which he represented as an MP, with his second wife Rachel. His first wife, Olympia, died of breast cancer in 2001, aged 57. 

Sir Vince, who appeared on Strictly Come Dancing in 2010, is a visiting professor at the London School of Economics.

What did your parents teach you about money?

I was one of two boys and grew up in York. My parents left school at 15 and started out as factory workers, and that was probably why they were quite thrifty and money-conscious. However, my father became a lecturer at a technical college so we gradually progressed from a terraced house with an outside loo to a detached house. 

That said, there wasn’t a great deal of spending or anything you could regard as extravagant. I worked as a milkman at the weekend while at school to make a few quid – and we were usually the last in our street to get a household appliance such as a fridge. 

Like my parents, I’ve never been spendthrift but at the same time believe that life is for living. I like staying in good hotels and went skiing until the pandemic and, while the spirit is still willing…

Have you ever struggled to make ends meet?

My first wife, Olympia, and I struggled financially after getting married in our 20s and we initially lived in quite a poky tenement flat in Glasgow. But I didn’t let that get in the way of, for instance, buying her a £700 Steinway grand piano on credit even though we couldn’t really afford it. Everything you should tell your children not to do, I did.

Have you ever been paid silly money?

I’ve done quite a lot of paid speaking but not for astronomical sums. If you’re an ex-prime minister you can be paid hundreds of thousands for giving a speech. But if you’re an ex-Cabinet minister and Lib Dem leader like me, you’re more likely to be paid a few thousand.

What was the best year of your financial life?

I enjoyed a bit of fame and fortune at the time of the financial crisis of 2008-9 and published a book, The Storm, in 2009 about the world economic crisis of the time, which became a best-seller.

It generated a lot of invitations to appear at book festivals and I also wrote a column for The Mail on Sunday, for a bit of extra money. So the years 2009-10 were probably my best. I was also comparatively well-paid in the five years that I was a minister during the coalition government of 2010-15.

The most expensive thing you have done for fun?

Going on the holiday of a lifetime to Cambodia and Laos for a couple of weeks with my wife Rachel last year to celebrate my 80th birthday. It cost about £18,000, in part because we flew business class due to the 12-hour flight, but my children chipped in towards the cost.

It was worth every penny, though, and we got to see Laos’s old royal capital Luang Prabang among other cultural sites.

What’s been your biggest money mistake?

Buying and selling property at the wrong time. My wife and I bought our first property, a red sandstone Glasgow tenement flat, at the beginning of one of these housing booms for £7,000-£8,000 – big money at the time, and sold it at the next downturn. I subsequently became wary about buying and selling properties.

The best money decision you have made?

Taking weekly dance classes and having my own personal trainer who puts me through a series of gruelling exercises. Together that costs close to £200 a week but keeps me fit. Dancing is also mentally very good for you.

Do you have a pension?

Yes – the pension arrangements for my generation of MPs were pretty good so it is possible to live comfortably after retirement. I’ve combined my Shell pension with my MP and Cabinet minister pension scheme.

Do you own any property?

I own a four-bedroom 1930s semi-detached house in Twickenham which I bought for £12,500 in 1974.

We’ve made a few improvements and I’m not sure what it’s worth now, but any family home in this part of London close to the railway station and the parks is going to be pretty valuable. My wife has a cottage in the New Forest.

If you were Chancellor what would you do?

I’d be honest about the fact that there’s no way of sustaining quality public services without a substantial increase in taxation, but nobody’s willing to say that.

The idea that we’re an over-taxed nation is nonsense – it’s about 38 per cent of GDP, whereas in Denmark it’s more than 50 per cent. Secondly, taxation should be tweaked so that it bears more heavily on the older generation, who have benefited from appreciating property prices, and does more for the young and particularly those with families.

What is your number one financial priority?

Hoarding money at my age doesn’t seem very sensible, so I’d like to do a bit more travelling while I can. At the same time, you can’t splash it about because you need to think about the future. So it’s a case of moderation in all things.

Thankfully I have no aspiration to owning a big, fancy car – I drive a ten-year-old Toyota Yaris.

• How To Be A Politician (Penguin), by Vince Cable, and Partnership & Politics In A Divided Decade (The Real Press), by Vince Cable and Rachel Smith, are both out now.