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What is Greensill Capital and why is David Cameron facing an investigation?

Adam Forrest
·4-min read
What is Greensill Capital and why is David Cameron facing an investigation?
David Cameron (PA)
David Cameron (PA)

Downing Street has confirmed an inquiry into David Cameron’s dealings with finance firm Greensill Capital will be widened, after new details emerged in the lobbying affair.

The former Conservative party leader is facing a growing number of questions on his relationship with Lex Greensill, the Australian founder of financial firm Greensill Capital.

It emerged this week that one of Mr Cameron’s top civil servants, Bill Crothers, was able to joined Greensill on a part-time basis while still working for government. Labour called it “extraordinary and shocking” revelation.

Boris Johnson is said to be “personally concerned” at the latest development, and No 10 said the inquiry would also now look at how Mr Crothers was able to work for the public and private sector at the same time.

Earlier this month an investigation by the Sunday Times claimed Mr Greensill enriched himself through a government-backed loan scheme he designed after Mr Cameron gave him access to several Whitehall departments during his time at No 10.

It has emerged that Mr Cameron lobbied at least four Tory ministers on behalf of Greensill in recent years – including organising a “private drink” with the health secretary Matt Hancock.

The former Tory leader is said to been “candid” with friends about money, saying he stood to make around $60m from the firm before its collapse, according toThe Times.

Wasn’t Cameron cleared by a lobbying watchdog?

Mr Cameron was last week cleared of breaking lobbying rules by a watchdog after reportedly asking chancellor Rishi Sunak to support Greensill last year through the government’s Covid Corporate Financing Facility.

The Registrar of Consultant Lobbyists concluded that Mr Cameron was not required to declare himself on the register of consultant lobbyists.

But the former Tory PM is facing scrutiny over both his time at No 10 and his lobbying work for Greensill in recent years. It is alleged that Mr Greensill was given special access to government departments while Mr Cameron was in office so he could promote a financial product he specialised in.

The Pharmacy Early Payment Scheme saw banks swiftly reimburse pharmacists for providing NHS prescriptions, for a fee, before recovering the money from the government. Greensill Capital went on to provide funds for the scheme.

Boris Johnson and David Cameron together in 2012Getty Images
Boris Johnson and David Cameron together in 2012Getty Images

What will the inquiry announced by the PM investigate?

Mr Johnson has asked leading lawyer Nigel Boardman to look into “how business representatives engaged with government” in discussions over supply chain finance and how contracts were awarded.

Downing Street said Mr Boardman – an adviser to the business department and son of a Tory cabinet minister – would be given “carte blanche” to investigate fully. But No 10 also confirmed he would have no legal powers, and would not be suggesting any changes to current lobbying rules.

Labour is not satisfied the review will be enough – claiming it felt like a “cover up” and an “attempt to push bad behaviour into the long grass”.

Keir Starmer’s party is urging MPs to vote through a proposal to establish a full parliamentary inquiry into Mr Cameron’s lobbying activities – with the power to summon witnesses – in a bid to reform lobbying rules.

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What has the government’s response to the scandal been?

Ministers initially tried to defend Mr Cameron. Culture secretary Oliver Dowden back his long-term ally by saying the former PM was a “man of utmost integrity and I’ve no doubt at all he would have behaved properly”.

The cabinet minister said earlier this month: “As far as I can tell, no decision in government policy was changed as a result of any meetings that took place. They’d be properly declared.”

Mr Johnson has made no attempt to defend Mr Cameron, however. Speaking about the announced investigation, the PM claimed his inquiry chief Mr Boardman would be given “pretty much carte blanche to ask anybody whatever he needs”.

What’s been Cameron’s response?

Mr Cameron has insisted he broke no rules over his lobbying for Greensill, but admitted he should have communicated with the government “through only the most formal of channels”.

He said he understood public concern about his informal contacts – including by text message and email with ministers including Mr Hancock and Mr Sunak – acknowledging that he should have acted differently “so there can be no room for misinterpretation”.

He said he would comply with Mr Boardman’s inquiry into his activities.

What’s the impact of Greensill’s collapse?

Concerns over the future of the Liberty Steel company have been expressed after financial backer Greensill Capital went bust.

Liberty Steel employs around 5,000 workers at a number of sites across the UK. A government spokesman said: “The government is closely monitoring developments around Liberty Steel and continues to engage closely with the company, the broader UK steel industry and trade unions.”

Shadow business secretary Ed Miliband said ministers must have a “plan B” for the steel giant. “All options should be on the table, including public ownership.”

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