U.K.’s Cameron Greensill Controversy Grows as Hancock Drawn In

Bookmark

The controversy surrounding former U.K. Prime Minister David Cameron’s lobbying for Greensill Capital deepened, as the Sunday Times reported the firm was awarded a contract with the National Health Service after he held a private meeting with a cabinet minister.

Cameron arranged a private drink in 2019 with Health Secretary Matt Hancock and Australian financier Lex Greensill, after which the NHS began using a payment service from a Greensill Capital start-up, the Sunday Times said. The service allowed NHS employees, under strain from the coronavirus pandemic, to receive their wages in advance. The deal was done without a procurement process, the newspaper said.

The latest revelation about Cameron’s lobbying draws a new cabinet minister into the saga, and puts a renewed focus on accusations of cronyism in the Conservative Party. To date, government ministers have defended Cameron’s conduct, shrugging it off on the basis that his lobbying wasn’t successful. The Sunday Times NHS report suggests Cameron’s access did in fact pay off for Greensill.

The extent of Cameron’s lobbying on behalf of Greensill, which specialized in financing supply-chain invoices, only came to light after the company collapsed last month in one of the most spectacular financial blow-ups of recent years. The demise of Greensill has put thousands of U.K. jobs at risk because the future of companies in Sanjeev Gupta’s GFG Alliance -- including steel mills in Britain -- is in doubt without access to Greensill’s financing.

The new developments in the Greensill affair also come ahead of local and mayoral elections in Britain on May 6, with the latest national YouGov polling giving Johnson’s Tories an eight-point lead over Keir Starmer’s Labour Party. Johnson has enjoyed a boost in his popularity from the U.K.’s vaccination program, which has been the most successful in Europe, but the Greensill and cronyism claims may erode some of that goodwill.

Officials insist there was no impropriety when awarding the NHS contract. Hancock updated officials on the business that was discussed at his meeting with Greensill and Cameron, and he acted appropriately, according to a person familiar with the matter, speaking on condition of anonymity.

“The well-being of NHS staff is the top priority of the department and Health Secretary,” the Department for Health and Social Care said in a statement in response to the Sunday Times story. “Our approach was and is that local NHS employers are best placed to decide how different pay flexibilities fit with their overall pay and reward offer for their staff.”

This week Chancellor of the Exchequer Rishi Sunak also came under fire after it was revealed he had “pushed” officials to consider helping the finance firm get access to Britain’s pandemic corporate support program. Sunak and Cameron had exchanged text messages on the matter.

Prime Minister Boris Johnson himself had no involvement in awarding the NHS contract and the issue was not raised with him, according to a separate person familiar with the matter, speaking on condition of anonymity.

“Throughout the pandemic, an immense number of businesses contacted Downing Street with representations,” 10 Downing Street said in a statement. “These were passed on to relevant departments.”

Johnson’s government has been criticized throughout the coronavirus pandemic for a lack of transparency over the awarding of contracts, with many tenders going to companies or individuals with connections to the Conservative Party. On Friday, the opposition Liberal Democrats party said the “stench of cronyism emanates from this government.”

Cameron also lobbied the Bank of England about financial support for Greensill, the central bank has said, though a U.K. watchdog has cleared him of unregistered lobbying. Britain’s former prime minister is yet to comment publicly on the Greensill affair.

©2021 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.