Greensill collapse: £ 335m of taxpayers’ cash at ‘increased risk’ due to ‘sadly inadequate’ control of firm David Cameron lobbied for | Politics news

Hundreds of millions of pounds of taxpayers’ money are at increased risk due to a lack of control of the now collapsed finance firm, for which David Cameron lobbied, a committee of MPs has found.

A new report from the House of Commons’ Public Accounting Committee (PAC) on the experiences that can be drawn from the death of Greensill capital, the group of MPs has examined a decision to allow the company to be a lender under government-supported COVID support schemes.

The state-owned British Business Bank approved Greensill as a lender for both the Coronavirus Business Interruption Loan Scheme (CBILS) as well as the Coronavirus Large Business Interruption Loan Scheme (CLBILS).

Greensill borrowed £ 400m under CLBILS, the maximum allowed to lend, and £ 18.5m under CBILS.

David Cameron and Lex Greensill on a trip to Saudi Arabia last January
The former prime minister with the company’s founder, Lex Greensill, on a trip to Saudi Arabia in January 2020

But in March this year, Greensill – who hired former prime minister Mr Cameron as an adviser – requested insolvency.

In their report, the PAC found that “up to £ 335 million of taxpayers’ money is at increased risk following British Business Bank’s failure to carry out adequate due diligence” at Greensill when the company applied to be an accredited lender under the COVID support schemes.

MPs concluded that the bank’s “approach to timely diligence in accrediting Greensill was deeply inadequate” and criticized the bank for finding the “wrong balance” between “making decisions quickly” during the pandemic and “protecting taxpayers’ interests”.

“In the case of Greensill, the bank was insufficiently curious about media reports questioning Greensill’s lending model, its overexposure to borrowers and ethical standards until the problems were clear and hundreds of millions of taxpayers’ money were left uncovered,” their report added.

They also found that “lack of information sharing across the government” had “once again hampered sound decision-making in the government’s response to the pandemic and given Greensill access to taxpayer-funded schemes”.

Please use the Chrome browser for a more accessible video player

Cameron asked about messages sent to ministers

The PAC also said the government “had not yet identified the broader experience from its accreditation of Greensill or from its COVID-19 business support schemes”, adding that it was “essential that these experiences be identified”.

In further criticism of the bank, MPs said it had been “insufficiently curious when identifying where money lent through the schemes, including by Greensill, has ultimately gone off”.

In a series of recommendations, MPs called on the bank to review its accreditation process, and for itself, the Ministry of Finance and the Department of Business, Energy and Industry Strategy to publish a “complete report on experience” by July next year.

Subscribe to the All Out Politics podcast at Apple Podcasts, Google Podcasts, Spotify, Speaker

Sir. Cameron has been reported to have earned around £ 7 million during his two and a half year part-time job for Greensill before its collapse, including a salary of £ 720,000 a year.

Earlier this year, the former prime minister was revealed to have bombed ministers and officials – as well as the Bank of England – with WhatsApps, text messages and emails in his quest to win Greensill access to government-backed COVID support schemes.

Labor MP Dame Meg Hillier, chair of the PAC, said: “The British Business Bank only needed to read the newspaper to be aware of serious questions about Greensill’s lending model, overexposure to borrowers and its ethical standards – but it did ‘I started seriously dive into these issues before the problems were clear and hundreds of millions of taxpayers’ money were already in jeopardy.

“It declared itself ‘very surprised’ to discover where these taxpayer-subsidized loans had gone on their guard, in breach of its own lending and accreditation rules.”

A government spokesman said: “The government was not involved in the decision to accredit Greensill.

“The decision was taken independently by the British Business Bank in accordance with their usual procedures.”

Leave a Comment