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Greensill scandal - what are the key points to know?

Greensill scandal - what are the key points to know?

A row is ongoing regarding links between finance company Greensill Capital and senior government figures - here's a look at some of the key points...

 

What is the row about?

The row is centred around the lobbying of government ministers, or in other words, trying to persuade the government on particular matters.

The row is particularly focused on the activities of former Prime Minister David Cameron and finance company Greensill Capital, however, it has raised concerns about the lobbying of government ministers more generally. Companies that work with the government can stand to make lots of money from doing so, hence it is considered important that rules around procurement (finding and agreeing to terms of contracts) are fair.

The row has raised concerns that former politicians might be able to use their connections in order to get contracts for certain companies (at greater ease than other people) which they are connected to and stand to financially benefit from.

 

What did David Cameron actually do?

During his time as Prime Minister, Mr Cameron appointed Lex Greensill, the founder of Greensill Capital, as an unpaid senior adviser. In this role, Mr Greensill developed policies including a payment scheme for pharmacies, which it is understood his business benefitted from.

In 2018, more than 2 years after leaving Downing Street, David Cameron then started working for Greensill Capital. Since then, he has approached a number of government ministers on behalf of the company to try and secure access to a Coronavirus loan scheme known as the Covid Corporate Financing Facility, so that the company could issue loans using tax-payer money. 

It is understood that Cameron sent text messages to Rishi Sunak, sent an email to a Downing Street adviser and approached two junior ministers in the Treasury to try and secure access to the scheme. The firm was not given access to the scheme, however, the firm was allowed to issue loans using tens of millions of pounds of tax-payer funds through the Coronavirus Large Business Interruption Loan Scheme (CLBILS).

Ahead of the pandemic, Mr Cameron also met with Lex Greensill and Health Secretary Matt Hancock over a 'private drink' to discuss a new payment scheme for the NHS, according to The Sunday Times.

 

What is actually the problem here?

The concerns here are over whether David Cameron was able to have unfair influence and get Greensill Capital special access to Government schemes. There are perhaps very few people that can pick up the phone and speak to the Chancellor, and even fewer who can actually get a reply.

An official watchdog last month cleared Mr Cameron of any wrongdoing. Under current rules, people lobbying ministers or senior civil servants have to register to do so, though people lobbying on behalf of their organisation are not required to register. Many people have called for tougher rules on lobbying to be implemented.

Last month, Greensill Capital entered administration, costing 440 jobs. Thousands more jobs in companies which Greensill had helped finance are also at risk. 

 

What is being done about it?

The Government has said they will hold an inquiry that will be led by lawyer Nigel Boardman and will also look at suggestions to improve lobbying rules. Mr Boardman is due to report any findings to the Prime Minister by the end of June.

Labour and other opposition MPs have said the scandal has eroded trust in politics and that there needs to much more transparency over lobbying.

David Cameron has said he should have acted differently, but has claimed he broke "no codes of conduct and no government rules".