David Cameron appointed Lex Greensill first as a senior adviser and then as a “crown representative” of the UK government in 2014. Greensill was, at the same time, an aggressive financial engineer, involved in the use of derivatives to lend to firms against their future income. He even persuaded the government to let his firm offer this service to Britain’s pharmacies.
Bill Crothers was a civil servant in charge of spending the government’s money. First, he helped bring Greensill into his role doling out major government contracts. Then in 2016, after leaving Whitehall less than a year earlier, Crothers joined Greensill’s company. In 2018 that company won a lucrative government contract, providing £1.2bn in loans to pharmacies, taking a fee for every loan.
In the same year, Cameron himself became a paid adviser to Greensill’s company in a perfect example of the Whitehall revolving-door operation. It was in that role, as the Covid-19 pandemic hit, that the former prime minister allegedly lobbied Chancellor Rishi Sunak to hand government loans to the stricken financial firm, even as it headed towards bankruptcy.
Meanwhile, in an entirely separate development, Jennifer Arcuri has stated that she had a four-year relationship with the then mayor of London Boris Johnson as he doled out £126,000 of contracts to her firm and invited her on lucrative trade missions. According to the New York Times, Johnson and his ministers handed $11bn of taxpayers’ money during the pandemic “to companies either run by friends and associates of politicians in the Conservative Party, or with no prior experience or a history of controversy”.
In short, we are adrift in a sea of corruption, past and present. If you’ve been anywhere near power, you know how this works. None of it is done in secret. It’s done with the connivance and the blind eye of everyone who sees it happen. Nobody asks awkward questions such as, why is this guy even in the room? Nobody who wants a promotion or an invite to the summer party, that is.
Sure, there are formal standards, such as the ones that require Crothers to have permission from a committee to take up his new job, or that lobbyists have to declare their interests, and that ministers should declare contact with them and any conflict of interest. But these are mere formalities. Johnson has not yet confirmed whether he will give evidence to the Greater London Authority inquiry into his alleged relationship with Arcuri.
The tragedy is that most of British capitalism is not corrupt. There is a strongly competitive culture between firms but also a culture of prudence and respect for the letter of the law that, in my experience, reaches right down into middle management.
It is the system of government that’s corrupt. The mania for privatising public services may have subsided, but the privatisation of governance has not. Over the past 20 years, with Blairism as the instigator, the UK’s system of governance has become a network of commercial relationships, largely divorced from parliament and beyond its scrutiny.
Take the “Crown Representative system” itself. It was introduced in 2011 to allow major strategic firms – such as CapGemini, Microsoft and Vodafone – to act as the purchaser of government services on behalf of the government. Recognising the risks of employing the poacher as head gamekeeper, the arrangement was governed until 2019 by a “Strategic Supplier Risk Management Policy” published on the government website, detailing all kinds of safeguards against conflict of interest.
Then, in recognition of the “now well-developed relationships with, and understanding of” its strategic suppliers, the risk management policy was scrapped in favour of one-to-one “memorandums of understanding” between government and these big firms. These are not published on the government website and, as a result, the implicit conflict of interest in the entire arrangement is to be policed only by the two parties to the deal themselves. The suppliers are responsible for supplying the government with “the information it needs”. Thus the conflict of interest has been created, institutionalised and ultimately disappeared into a world of business secrecy.
Yet nobody seems to care. The press, which got worked up into a frenzy if any Corbyn associates strayed into a dodgy Facebook group, is tiptoeing carefully around the eggshells of the Greensill case. Nobody thought to ask about Arcuri when Johnson appeared at his Union Jack-festooned press conference on 29 March.
Nor is the public particularly exercised about these revelations. If they were, the tabloids – whose editors retain a strong gut sense of what matters to small-town Britain – would be all over the stories of Greensill and Cameron, Johnson and Arcuri, and the Covid cronyism scandals.
The reason why can be understood allegorically by watching the UK’s most popular serial drama, Line of Duty. We are now in the sixth season of this “bent copper” drama in which the police force of just a single British city has been found to contain numerous serial killers and organised criminals, while both the council and the national policing regulators are riddled with corruption.
While nobody in their right mind thinks Line of Duty is real, its metaphoric truth is: when dealing with the commercialised and fragmented British state, you have to assume that everybody is on the make, everyone is gaming the system, everyone has something to hide, and that behind every investigation there is a cover-up.
Beyond this general feeling of numbness and indifference towards malfeasance in public office, there is also something more specific. For a minority of the electorate, so long as Johnson and his ministers go on delivering a steady diet of prejudice, illiberalism and provocations against “wokeness”, they will be forgiven any mistake. Tens of thousands of elderly people dead because of an unconscionably late lockdown? Christmas cancelled? The fishing industry destroyed? A trade border now drawn in the Irish Sea? None of it matters so long as Johnson, Priti Patel and the rest are prepared to fight the culture war.
But it should matter and the opposition needs to make it matter. Labour’s Rachel Reeves has carved out a strong position by meticulously pursuing evidence and explanations over the Covid cronyism scandals. Translating this into a potent political narrative requires Labour to go further.
As it stands, 5,000 jobs in some of Britain’s most strategic and high-tech steel plants are at risk because Liberty Steel, which was financed by Greensill, is on the brink of collapse. The government will be obliged to step in, either through nationalisation or a major ownership stake, should Liberty go under. Meanwhile, among Britain’s pharmacies, emergency measures are in place for the government to pay prescription bills directly, cutting out the now bankrupt middleman of Greensill’s finance arm.
The injection of private ownership and financial engineering, in sectors as diverse as steel and pharmacies, has proven destabilising and unnecessary. It has lined the pockets of the finance men while inserting layer after layer of opacity into the accountability system that should run between parliament, government and private sector suppliers.
I want Labour to commit, morally and philosophically, to ending it. Not just reversing rail privatisation, or renationalising the Post Office, but extricating the financial engineers from the entire machinery of government.
The grasping, sticky-fingered con artist is an archetype well recognised in the working-class communities where Labour needs to win. Every working-class person can tell the difference between the loveable rogue – the Del Boy and Private Walker types – from the person who rings your grandma and steals her savings over the phone, or clads your building with flammable material, leaving your apartment unsellable.
There is a huge residue of anger and resentment at the way rogue corporations and financiers are disfiguring everyday life – even if most people would never be able to understand the complexities of Greensill, Liberty Steel and their world.
Labour needs to do what Keir Starmer promised to do more generically: make this an issue of moral socialism. As I’ve argued here before, graft and favouritism are not incidental methodologies for Johnson’s Conservatives. They are a way of life. To enrich oneself and one’s friends, and to stay in office, while waging a 24/7 culture war against liberalism and the left – that is now the Tories’ raison d’être. It’s time to make them pay a political price.