The inquiry also recommends greater transparency and accountability from the government. Unfortunately, the trend is in the opposite direction.
It is a formality of British politics that when a big scandal breaks, a public inquiry is formed. Sometimes a scandal is so bad that it warrants more than one. So far, the Greensill affair, the worst lobbying scandal in a generation, has racked up no fewer than eight separate inquiries.
The first to report its “interim” findings — that of the Committee on Standards in Public Life — has recommended that former ministers and civil servants who enter the private sector should be barred from lobbying for up to five years, as opposed to the current two-year limit. Chaired by Lord Jonathan Evans, a former MI5 chief, the committee said the ban should, if possible, be made legally enforceable.
“If an applicant had a particularly senior role, or where contacts made or privileged information received will remain relevant after two years, a longer ban may be necessary to ensure former officials lobbying government are not directly benefiting from their time in office when they do so,” Evans said in his report.
When Lobbying Becomes Stalking
The inquiry has revealed how the former premier David Cameron, who had joined the supply chain finance provider Greensill as an advisor in 2018, blitzed government ministers, including the Chancellor of the Exchequer Rishi Sunak, and officials at 10 Downing Street, the Treasury and Bank of England with around 80 text, WhatsApp and email messages during the first four months of the coronavirus crisis. One member of the Treasury Select Committee likened it more to “stalking than lobbying”.
Cameron was desperate to secure Greensill access to Covid support. Once he had, he tried to increase the amount the company could receive. In June, he urged both Sunak and vaccines minister Nadhim Zahawi to increase the maximum loan Greensill could make under the Treasury’s Coronavirus Large Business Interruption Loan Scheme (CLBILS) from £50 million to £200 million. The difference, Cameron said, was “rather crucial”.
By that time Greensill was on the ropes. A number of its client companies had already collapsed. Attention was shifting to the financial menage á trois Greensill had formed with its primary backer, Soft Bank, and Swiss mega-lender Credit Suisse. Greensill was also under investigation by German banking regulator BaFin and the Association of German Banks, an industry group, over its German subsidiary Greensill Bank’s huge exposure to a single client: UK-based steel magnate Sanjeev Gupta.
The company needed money fast. And thanks to Cameron’s tireless lobbying, it got it. Greensill was able to make loans totalling £418 million under the government’s coronavirus lending schemes, £335 million of which was guaranteed by the British Business Bank. Most of that money ended up going to Greensill’s biggest client, Gupta’s GFG Alliance.
Special Treatment
Greensill Capital was the only non-bank financial firm to administer the emergency coronavirus loan schemes. It was also exempt from the capital adequacy and stress tests that are normally applied to lenders. The only apparent reason for this special treatment was Cameron’s persistent lobbying, none of which was included in departmental disclosures. This patent disregard for transparency and accountability is par for the course in British government today, says the Committee on Standards in Public Life:
“It is too difficult to find out who is lobbying government, information is often released too late, descriptions of the content of government meetings are ambiguous and lack necessary detail, transparency data is scattered, disparate, and not easily cross-referenced, and information in the public interest is often excluded from data releases completely. Reforms are needed to the accessibility, quality, and timeliness of government data and to the scope of transparency rules. The rules and guidance on informal lobbying and alternative forms of communication also require improvement and greater clarity.”
Other recommendations made by the Committee include a two-year ban on ministers and senior officials taking a job in their policy area once they leave office, new guidance on the use of modern forms of communication (texts and WhatsApp messages), closing the loophole on not disclosing “informal lobbying” (such as drinks and/or dinner) and lobbying information being published more regularly and in more detail.
These, of course, are all recommendations; they are not legally binding. Their implementation depends entirely on the government of the day.
Government By WhatsApp
It’s far from clear whether today’s government, with all its skeleton-filled closets, will actually be interested in greater disclosure. If anything, the trend is in the opposite direction. The government is adopting an increasingly hostile response to requests made under the Freedom of Information Act. According to a new report in The Guardian, the disregard for transparency and accountability in government is so widespread that ministers and civil servants are now using self-deleting messages for much of their internal communication.
Continue reading on Naked Capitalism
Nick Corbishley 