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4 months ago
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Links between senior government figures and the finance company, Greensill Capital are to be investigated by MPs and official bodies.
Among those in the spotlight is former Prime Minister David Cameron, who has been criticised for lobbying ministers on behalf of Greensill, a company in which he had a commercial interest and which collapsed earlier this year.
What is David Cameron said to have done?
David Cameron was prime minister from 2010 to 2016.
During this time, he appointed Lex Greensill as an unpaid adviser, and allowed him to develop a policy that would ensure small firms were paid more quickly. Mr Greensill's company, Greensill Capital, benefited from this scheme.
After leaving office, Mr Cameron was employed by Greensill Capital and tried unsuccessfully to lobby - in other words, to persuade the government - to give the firm more access to government-backed loans.
Mr Cameron contacted government ministers on several occasions:
Greensill Capital has now gone bust, throwing the future of thousands of workers at Liberty Steel, a company backed by the finance firm, into doubt.
image copyrightShutterstock
image captionLex Greensill was an unpaid adviser to then Prime Minister David CameronHow has the government reacted?
It announced a review into decisions made in government around Greensill's finance scheme and the role of Lex Greensill.
It will be headed by government lawyer Nicholas Boardman and will report back to Boris Johnson by the end of June.
Downing Street says the review will look at "how contracts were secured and how business representatives engaged with government".
Labour has criticised the scope of the review - which is not expected to have any legal powers.
The Commons Treasury Select Committee said it would launch an inquiry into the "lessons" from the firm's collapse, and "the appropriateness of HM Treasury's response to lobbying".
The National Audit Office has also said it is launching an investigation into Greensill Capital - namely, how it was allowed to offer government-backed loans during the pandemic.
What has David Cameron said?
Mr Cameron says he will "respond positively" to any requests to give evidence to the Treasury Select Committee.
However, this does not mean he will necessarily appear in person to answer MPs' questions.
After weeks of silence, the former prime minister issued a statement defending his involvement with Lex Greensill and Greensill Capital.
He admitted he should have contacted the government "through only the most formal of channels" when lobbying for a financial firm.
But he denied that he broke any codes of conduct or any government rules on lobbying.
What do the lobbying rules say?
The current rules state that "on leaving office, ministers will be prohibited from lobbying government for two years".
Mr Cameron stood down as prime minister in July 2016 and joined Greensill in August 2018.
Before accepting new jobs, former ministers are supposed to inform a body called the Advisory Committee on Business Appointments (Acoba).
Acoba advises civil servants and politicians on what they can and can't do after leaving public service.
However, although former ministers are required to contact Acoba, they are not obliged to act on its advice.
Are there unanswered questions?
A Sunday Times investigation claims many in Whitehall had serious reservations about Mr Greensill's original employment as a special adviser, and about the value of his early-payment scheme.
Mr Cameron's statement does not specify how much he was paid when he went to work for Greensill Capital. He had shares in the company, but he denies claims that he told friends he was set to earn as much as £60m from them.
Nor does Mr Cameron declare whether he lobbied any other ministers.
Who else has been involved?
It has been revealed that a senior civil servant took a part-time job as an adviser at Greensill Capital in 2015, while he was still on the civil service payroll.
Bill Crothers says his appointment was "agreed" by the Cabinet Office.
As a civil servant, Mr Crothers was not obliged to seek Acoba's advice.
Acoba's head, Lord Pickles, has told MPs the case highlights "a number of anomalies within the system that require... immediate address".
Why did Greensill Capital collapse?
image copyrightReuters
image captionLiberty Steel's future is in doubt after Greensill Capital's collapseQuestions had been asked before about the sustainability of Greensill's business since at least 2018.
But the final blow came last July, when one of its insurance companies withdrew cover that protected some of Greensill's investors.
Liberty Steel, Britain's third-largest steel producer, employing 3,000 people in England, Scotland and Wales, was receiving financial backing from Greensill.
Its future is now in doubt.
