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Nadhim Zahawi was rejected for a peerage by the Conservatives just weeks before he defected to Reform UK, Tory sources have told the Guardian.
The former chancellor asked Kemi Badenoch’s top team for a seat in the House of Lords but was rebuffed because he had been sacked as Tory chair in 2023 over his tax affairs.
Zahawi was announced on Monday as Reform’s newest recruit – and the most senior former Tory to join it – as the former MP claimed Britain was on the brink of “civil unrest” and only a government led by Nigel Farage could prevent it.
Both men faced awkward questions at a press conference where Zahawi was asked about his claim that Farage had made “offensive and racist” comments about him.
The Conservatives also revealed that Zahawi, who held a series of ministerial roles under Boris Johnson, had been in touch with senior party figures as recently as the end of last year.
“Nadhim asked for a peerage several times. Given he was sacked for his dodgy tax affairs, this was never going to happen,” a Tory source said. “His defection tells you everything you need to know about Reform being a repository for disgraced politicians.”
The Tories said the politician had got in touch with them, rather than the other way round. They pointed out that he joined Reform just weeks after Badenoch released her latest political honours list, on which he did not feature.
“While he wasn’t rudely rebuffed by us, he was never going to be made a peer,” the source added. “His defection came at a time that it was apparent he wasn’t going to get one.”
Appearing alongside Farage in London, the former chancellor said he had let his Tory membership lapse in December before deciding to join Reform, which he said he was doing because the UK needed “a glorious revolution”. He had been promised no specific role in Reform and was joining as a “foot soldier”, he added.
Zahawi, who stood down as the MP for Stratford-on-Avon at the last election, was sacked in 2023 as Conservative party chair by Rishi Sunak after he was found to have breached the ministerial code by failing to declare an HMRC investigation into his tax affairs.
Zahawi cited concerns about what he saw as threats to freedom of speech, the imposition of high taxes and the “big state”. Nick Candy, Reform’s treasurer and a personal friend, acted as a bridge and Farage said the party would be looking to the former MP to help bring in new donations.
Zahawi said: “My analysis is that a huge culprit is the over-mighty bureaucratic inertia that now dominates and runs the country, that has taken control of swathes of the economy and, with barely a shrug of the shoulders, restricts the individual liberty of each and every one of us.
“We can all see that our beautiful, ancient, kind, magical island story has reached a dark and dangerous chapter.”
However, he was repeatedly forced to defend Farage over allegations of racism and antisemitism, saying he would not be sitting beside him if he believed he had a “racist bone in his body”.
Thirty-four school contemporaries of Farage have come forward to claim they saw him behave in a racist or antisemitic manner, leading to questions over the Reform leader’s evolving denials.
A now-deleted tweet from 2015 was also brought up, in which Zahawi had written: “I’m not British born mr Nigel_Farage. I am as British as u r. Yr comments r offensive & racist. I wld be frightened 2 live in a country run by U.”
When questioned about this tweet on Monday, Zahawi said: “If I thought this man sitting next to me in any way had an issue with people of my colour or my background who have come to this country, who have integrated, assimilated, are proud of this country, worked hard in this country, paid millions of pounds in taxes in this country, invested in the country, I wouldn’t be sitting next to him.”
The tweet appeared to have been in response to a broadcast interview in 2015 in which Farage was asked if he was in favour of keeping laws that ban employment discrimination on the grounds of race or colour. Farage answered “no” though later claimed he had been “wilfully misrepresented”.
Zahawi also wrote a piece for the website ConservativeHome at the time, under the headline: “In Farage’s Britain, it would be legal to discriminate against me on the grounds of race.”
The Reform leader said Zahawi’s arrival would help to bolster the party’s credentials as a serious contender for government, adding: “Our weakness is that we lack frontline experience. People like Nadhim have been on the inside. They know how government works or how government does not work.”
After his defection was announced, Zahawi’s former party described him as the latest of a number of “has-been politicians looking for their next gravy train”.
“Their latest recruit used to say he’d be ‘frightened to live in a country’ run by Nigel Farage, which shows the level of loyalty for sale,” a Tory spokesperson added. “Reform want higher welfare spending and higher taxes. They are a one-man band with no plan for our country.”
Anna Turley, the Labour party chair, said of the defection: “This confirms what we already knew: Reform UK has no shame. Nadhim Zahawi is a discredited and disgraced politician who will be forever tied to the Tories’ shameful record of failure in government.
“Zahawi himself has previously repeatedly lambasted his new boss over his divisive and extreme rhetoric – and Farage has said that Zahawi has no principles and is only interested in climbing the greasy pole.”
