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22 April 2021

Cameron lobbied Treasury and Bank of England chiefs for Greensill

22 April 2021

David Cameron personally lobbied the top civil servant at the Treasury and the deputy governor of the Bank of England on behalf of the failed finance firm Greensill Capital, it has been disclosed.

Sir Tom Scholar, the permanent secretary at the Treasury, revealed that the former prime minister had called him on his mobile phone as well as sending a series of texts.

Separately, the Bank disclosed that Mr Cameron had set up a call between the firm’s founder, Australian financier Lex Greensill, and deputy governor Sir Jon Cunliffe.

It released a series of emails showing how he tried to enlist Sir Jon’s help when the Treasury rejected Greensill’s application to join one of the Government’s Covid support schemes.

Bank of England deputy governor Sir Jon Cunliffe (PA Archive)

The latest disclosures come after Boris Johnson earlier this month commissioned the senior lawyer Nigel Boardman to investigate after it emerged Mr Cameron had lobbied Chancellor Rishi Sunak and other ministers on the firm’s behalf.

Giving evidence to the Commons Public Accounts Committee, Sir Tom said he had been contacted by Mr Cameron in early April last year over a proposal Greensill had made to join the Government’s Covid Corporate Financing Facility (CCFF).

He said Mr Cameron had his official mobile number because he used to work for him when he was still in office.

“If a former minister that I have worked with asks to talk to me, I will always do that,” he said.

Could I ask you to do a one to one with Lex Greensill so that he can brief you on where we have got to?

“The call I took from Mr Cameron was not a substantive discussion of the proposal. It was simply a call to draw it to my attention. I said ‘Thank you very much, this is something we are looking at’.”

Sir Tom said that the proposal had been rejected by Treasury officials as it did not meet the criteria for the scheme.

However documents released by the Bank under the Freedom of Information Act show that Mr Cameron was reluctant to take no for an answer.

On April 3 2020, he emailed Sir Jon complaining that despite “numerous conversations” with the Treasury, Greensill had “failed to get anywhere”.

He said the firm had dealt with every objection that had been raised, but the Treasury appeared “hung up” on the fact that the CCFF was for “non-financial corporates”.

“This is surely irrelevant,” Mr Cameron said.

“At a time when we are – rightly – worried about how quickly banks can get loans out to small businesses, why are we potentially cutting off a market that already pumps cheap credit directly into SMEs.”

We were approached quite persistently from this company

He then emailed Sir Jon again on April 22 complaining that they had still not received the “green light” from the Treasury.

“I don’t want to put you to the trouble of a long email chain when ultimately this is an HMT call (and we continue to talk to them at every level) but could I ask you to do a one to one with Lex Greensill so that he can brief you on where we have got to,” he wrote.

A Bank note of call between Sir Jon and Mr Greensill said that the deputy governor made clear that the firm fell “outside the boundaries of the scheme”.

The collapse of Greensill – which filed for insolvency in March – has threatened thousands of UK jobs at Liberty Steel which was dependent on it for its financing.

In his evidence to the committee, Sir Tom said that Greensill had been dealt with in a “completely appropriate” way by the Treasury.

Everybody said we were too slow, not doing enough, should be more ambitious

“We were approached quite persistently from this company. We listened to what they said. We analysed it, we tested it and in the end, despite them submitting a series of successive proposals, we decided to reject them all,” he said.

Charles Roxburgh, the second permanent secretary at the Treasury, said the firm’s proposal to join the CCFF had been rejected for a number of reasons.

“They were proposing that special purpose vehicles could have access to the scheme and that was not consistent with the scheme’s design,” he said.

“They were suggesting that the CCFF should buy commercial paper that had non-standard terms and again that was not consistent with the design.”

Further proposals it put forward to improve the delivery of finance to small businesses active in the supply chains of large companies were, he said, also turned down.

The officials were pressed by Tory MP Sir Geoffrey Clifton-Brown as to why they spent so much time dealing with proposals which he described as “dodgy” and sounding “like a Ponzi scheme”.

Sir Tom said that at the time – at the start of the pandemic – the Treasury had been under “immense pressure” to do more to support business.

“Everybody said we were too slow, not doing enough, should be more ambitious, so we were investigating a whole series of ways in which we could support the flow of credit to businesses,” he said.

On Thursday night the Treasury released correspondence between Greensill and officials.

Some of the 30 pages of emails and documents were heavily redacted, but they show Sir Tom referring to Mr Cameron as “my old boss” and telling Mr Roxburgh the former prime minister wanted to know if the Chancellor had a “particular view” of the Greensill application.

A further release of information confirmed Treasury Economic Secretary John Glen had a text message exchange with Mr Cameron about the rejected Greensill proposal in June offering to “discuss with you privately this afternoon if that would be useful”.

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