Monday, April 19

Labor calls for changes to lobbying law after Greensill dispute | Lobbying

The law should be changed to avoid the kind of lobbying carried out by David Cameron on behalf of financier Lex Greensill, Labor argued, after more details emerged about the extent of Greensill’s influence within the Cameron government.

Only outside lobbyists dealing with the government should be on a formal industry register, and not so-called “inside” lobbyists like Cameron, who took on an advocacy role for Greensill Capital after leaving Downing Street.

The former prime minister faces questions about allegations that he sent a series of text messages to the personal phone of Rishi Sunak, the chancellor, in April last year seeking special access to emergency Covid loans for Greensill Capital, which has now collapsed.

Labor says the former prime minister may not technically break any rules, despite reportedly holding stock options in Greensill Capital worth a potential millions of pounds before the company’s demise.

Rachel Reeves, the shadow chancellor of the Duchy of Lancaster, who is leading Labor efforts on claims of cronyism in government, has called for the law to be expanded to include roles like the one Cameron plays.

It comes as more information emerged about the great influence he enjoyed during Cameron’s tenure on # 10 from Lex Greensill, the Australian financier whose company became a leading provider of so-called supply chain finance, a way of providing quick funds to companies affected by bad debts.

Greensill, who was initially employed by Citigroup, oversaw a lucrative supply chain financing scheme that involved NHS payments to pharmacies. He became so embedded in Downing Street that in 2012 he had an official business card number 10 describing him as a “senior advisor.”

A section of official documents leaked to the Sunday Times showed that Cameron and then-cabinet secretary Jeremy Heywood gave Greensill enough authority, who sent emails saying his plan would be implemented “across the government. One message told officials that he was informing them primarily as a courtesy, adding: “We are not seeking your approval.”

Later, Heywood nominated Greensill for a CBE for “services to the economy,” despite officials questioning the value of his pharmacy payment plan. A Treasury official wrote in a memo about Greensill: “Get him under control, keep him from approaching departments unilaterally.”

Despite the concerns, what became known as the pharmacy’s previous payment scheme was introduced in 2012, initially run by Citigroup and later by Greensill Capital, with no apparent bidding process or the ability for other banks to submit bids. Since Greensill’s collapse, it has been nationalized.

Labor say the Greensill case demonstrates the significant gap in lobbying rules, pointing to estimates from the Transparency International campaign group suggesting that internal lobbying could account for about 80% of all lobbying activity.

Reeves said: “Given the cronyism that consumes the Conservative Party, it is crucial that the scope of the lobbying registry be broadened to include internal lobbyists. Otherwise, it is clearly a rule for them and another for everyone else. “

Cameron’s actions, and the access Greensill had throughout the government, “perfectly illustrates both the ineffectiveness of the current rules and the total disregard of conservative ministers for any self-managed integrity in lobbying,” he said. “In 2014, conservatives were more concerned with gagging charities and unions than tackling the real issues with business lobbying.”

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