Boris Johnson Tries to Ride Out Greensill Lobbying Storm

(Bloomberg) -- Boris Johnson is trying to ride out a lobbying scandal that is threatening to puncture the surge in popularity the British prime minister has enjoyed following the U.K.’s rapid coronavirus vaccination program.

Critics have accused the ruling Conservative party of “sleaze” and called for an overhaul of the U.K.’s lobbying rules after it emerged former premier David Cameron lobbied ministers on behalf of the now insolvent finance firm Greensill Capital. A top civil servant was also advising the company while still being employed by the government.

The controversy has drawn attention to the revolving door between government and business -- and risks reviving memories of the lobbying scandals that plagued the Conservative government of the 1990s and helped usher in 13 years of Labour rule.

“This story could make them look like the same old Conservatives,” said Chris Curtis, senior research manager at polling company Opinium. “What this has effectively done is knocked the main story about vaccines off the top spot.”

‘Tory Sleaze’

As the scandal deepens, more public figures are being dragged into its vortex. The Telegraph newspaper reported that former Metropolitan Police Commissioner Bernard Hogan-Howe was a paid adviser to Greensill while he was still sitting on the board at the Cabinet Office.

The spotlight moved closer to Johnson himself late Wednesday. The Daily Mail newspaper reported the prime minister last June asked a senior aide to look into Saudi Arabia’s proposed takeover of Newcastle United Football Club at the behest of Crown Prince Mohammed bin Salman. The investor group led by Saudi Arabia’s Public Investment Fund ultimately abandoned the plan last year.

The number of formal probes is also increasing.

The government defeated opposition calls for a full parliamentary inquiry on Wednesday. Instead, Johnson has promised a narrower probe into the Greensill affair led by Nigel Boardman, who has served the government as an adviser.

But Parliament’s Treasury Committee is preparing to open its own inquiry into how the Chancellor of the Exchequer Rishi Sunak responded to Greensill’s overtures, while the Committee on Standards in Public Life is reviewing lobbying rules. Other parliamentary committees are expected to follow suit.

‘Influence Peddler’s Paradise’

More questions are likely to be raised when Eric Pickles, chairman of the advisory body which monitors the conduct of former ministers and public officials, appears before the Public Administration and Constitutional Affairs Committee on Thursday.

Sunak and Cameron are set to be called give evidence in separate parliamentary committees, the Financial Times said.

Johnson is also facing pressure in his own party to overhaul the rules on lobbying. Some Tory members of Parliament also publicly criticized them during Wednesday’s debate in the House of Commons.

Bob Sealy, who represents the Isle of Wight, described the U.K. as an “influence peddler’s paradise.”

Opposition Labour Leader Keir Starmer told lawmakers that Greensill represented only the “tip of the iceberg.”

‘Tory Sleaze’

“Dodgy contracts, privileged access, jobs for their mates,” he said. “This is the return of Tory sleaze.”

But the Greensill affair hasn’t cut through with voters -- yet -- in the same way as the cash-for-questions affair and sex scandals that plagued John Major’s premiership in the 1990s.

“Greensill is a little bit too dull for most people,” said Tim Bale, professor of politics at Queen Mary University of London. “Cameron is also yesterday’s man, and in many people’s eyes the pandemic is so important it blots out the sun.”

However, that perception could change if it can be shown that taxpayers’ money has been wasted, Opinium’s Curtis said.

The Labour Party has sought to do to just that, highlighting how contracts for personal protective equipment were awarded with little transparency to firms with close connections to the Tories during the coronavirus crisis.

Big Money

Cameron’s efforts have also put the spotlight on the network of former ministers now advising companies in the private sector.

Almost every prime minister or chancellor of the past 30 years took up a job in the finance industry after leaving office: Major became an adviser to Credit Suisse Group AG, Tony Blair to JPMorgan Chase & Co. and Gordon Brown to Pimco.

In more recent years, lawmakers have gravitated toward the technology sector: former Deputy Prime Minister Nick Clegg now works for Facebook Inc., while Cameron also advises Fiserv, a fintech firm, and Afiniti, an artificial intelligence business.

When running for office, Cameron predicted that lobbying was “the next big scandal waiting to happen” and promised to clamp down on what he called “the far-too-cosy relationship between politics, government, business and money.” In 2014, his coalition government acted.

It passed a bill that required consultant lobbyists to sign a register and curbed campaign contributions by third-party organizations.

Loopholes

The problem with the rules as they stand is that they don’t cover all people who undertake lobbying, said Vanessa Pine, director of public affairs agency Atlas Partners. It’s because they don’t extend to people working in-house for companies or trade bodies.

“To put an end to cronyism and close this loophole, transparency rules should apply to everyone,” she said. “Ministers, MPs, senior civil servants, agency and in house lobbyists alike.”

A spokesman for the Cabinet Office said permission must be obtained before civil servants take up outside appointments and it can only be given if there is no conflict of interest.

MPs are currently required to disclose their financial interests, and are banned from receiving any payment or benefit for promoting a particular political cause. After they leave parliament, these requirements no longer apply.

Disclosure

Ministers face additional requirements: their departments are required to disclose their meetings with lobbyists every quarter. For two years after they leave office, they must also consult the Advisory Committee on Business Appointments when taking on any new roles.

In a statement on Sunday, Cameron said he hadn’t broken any rules in his work for Greensill. He didn’t need to report his role to ACOBA because the two-year cooling-off period had elapsed.

The British system is “woefully opaque,” said Steve Goodrich, senior research manager at Transparency International U.K., a pressure group.

“Neither the statutory lobbying register nor departmental disclosures do what they are supposed to do: show who is trying to influence government, when, how and for what purpose,” he said.

That kind of information, he explained, is a legal requirement in the U.S., Canada and Ireland.

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