U.K. Lobbying Scandal Deepens as Hancock Accused of Cronyism
(Bloomberg) -- The controversy engulfing the U.K. government over its ties to business intensified as it emerged a second official held a position at Greensill Capital while still in his post, and Health Secretary Matt Hancock was accused of “cronyism” over the award of contracts to a company he owns shares in.
NHS Wales gave Topwood Ltd. two contracts worth 150,000 pounds ($206,000) for “confidential waste destruction” last month. Hancock, who is responsible for the National Health Service in England, has declared in the register of interests for members of Parliament he owns 15% of shares in the firm. His sister, Emily Gilruth, is a director of the firm, according to official records.
Prime Minister Boris Johnson’s spokesman, Jamie Davies, told reporters on Friday the premier has full confidence in Hancock.
“The health secretary acted entirely properly in these circumstances,” he said. “All declarations of interest have been made in accordance with the ministerial code. Ministers have no involvement in the awarding of these contracts, and no conflict of interest arises.”
Hancock’s connection with the company was first reported by the Health Service Journal.
The furore over lobbying began with former Prime Minister David Cameron’s advocating on behalf of Greensill but is rapidly widening to the potential overlap between official and personal interests and threatens to taint Boris Johnson’s Conservative administration.
Hancock’s connection to Topwood reveals the “cronyism at the heart of this government,” Jon Ashworth, health spokesman for the main opposition Labour Party, said on Twitter.
It comes after Labour leader Keir Starmer told MPs on Wednesday that the growing scandal surrounding Greensill Capital was “just the tip of the iceberg” for the government. “Dodgy contracts, privileged access, jobs for their mates,” he said. “This is the return of Tory sleaze.”
Davies said the government will “continue” to publish the list of ministers’ interest, without providing a date when it would do so.
The civil service is also under scrutiny over its ties with business. Late Thursday, it emerged that David Brierwood took up a post as a “Crown Representative” in the Cabinet Office in October 2014, joining Greensill two months later, his LinkedIn profile showed. A person familiar with the matter confirmed the two positions overlapped.
The former Morgan Stanley banker held both roles for more than three years before quitting his government post in June 2018. He left Greensill in February, and the lender collapsed in March.
Brierwood didn’t immediately respond to an email request. His dual roles were first reported by The Guardian. The Cabinet Office said in a statement that Brierwood’s government role didn’t touch on supply chain finance, Greensill’s specialist area.
“Crown representatives are recruited for their working knowledge of specific sectors to communicate government needs to the market and identify areas for cost savings to save money for the taxpayer,” Davies said. “They have no role in and do not participate in the procurement process, nor were they able to award any contracts.”
While there’s no suggestion Brierwood broke any rules, the fact that he was able to hold the two posts for more than three years will highlight that such a phenomenon was not uncommon.
It follows the revelation earlier this week that Bill Crothers joined Greensill as an adviser to its board in September 2015 -- two months before he left his post as the government’s Chief Commercial Officer.
The company’s founder, Lex Greensill, worked as a government adviser when David Cameron was prime minister -- and Cameron then took a post at the firm after leaving office.
He went on to lobby at least four current government ministers on behalf of the company, including Chancellor of the Exchequer Rishi Sunak and Hancock. Cameron served as prime minister between 2010 and 2016.
“All Crown Representatives go through regular propriety checks and cannot work with a supplier where there could be a conflict of interest,” the Cabinet Office said in a statement.
It added: “Crown Representatives do not participate in the procurement process nor are they able to award any contracts. They are part time senior executives recruited for their working knowledge of a sector to help ensure value for money for the taxpayer.”
Johnson has ordered an inquiry into supply chain financing and the government’s interactions with Greensill.
The controversy has instigated a series of parliamentary probes into the potential conflict of interest at stake for people holding a job in the public and private sector at the same time.
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