Gabriel Pogrund, Whitehall Correspondent
Sunday April 11 2021, 12.01am, The Sunday Times
David Cameron is at the centre of a lobbying scandal
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David Cameron took the disgraced financier Lex Greensill to a private meeting with Matt Hancock at which the pair lobbied the health secretary to introduce a payment scheme that was later offered within the NHS.
The former prime minister is at the centre of a lobbying scandal after it emerged he contacted ministers on behalf of Greensill Capital, a financial services company he advised and in which he held share options potentially worth tens of millions of pounds. It has since gone bust, threatening 55,000 jobs across the world, including 5,000 in Britain.
In October 2019, Cameron, 54, arranged and attended a “private drink” with Hancock and Greensill, the Australian banker whose firm wanted to introduce a scheme to remunerate doctors and nurses before their usual paydays. They were joined by Bill Crothers, the former head of government procurement who had become a director at Greensill Capital.
Matt Hancock, left, with David Cameron in 2015 on the Warren Hill gallops
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The meeting came two months after Greensill, 44, had emailed Hancock, 42, proposing a collaboration and claiming that senior NHS officials were “overwhelmingly positive” about the idea. After receiving the email, Hancock commissioned advice from civil servants.
One of those copied into the correspondence was Lord Prior, the chairman of NHS England and a minister in the Cameron adminstration.
It can separately be revealed that Prior, 66, who was awarded his peerage under Cameron, arranged meetings between Greensill and two of the NHS’s most powerful officials: Simon Stevens, its chief executive, and Dido Harding, then head of NHS Improvement. It is understood that Stevens met Greensill briefly at the behest of Prior.
The disclosure means that the health secretary is the fourth minister to become embroiled in the biggest lobbying scandal in a generation. The other three are chancellor Rishi Sunak, who told Cameron he had “pushed” officials to consider changing a government scheme, and two Treasury ministers.
There are no minutes of Hancock’s meeting with Cameron and Greensill. It is not logged in transparency releases and civil servants did not attend.
Allies of Hancock insist he fed relevant information back to officials at the Department of Health. They say that, while generally supportive of Greensill’s ideas, he encouraged him to work directly with NHS trusts on the basis that it was at no extra cost to staff or the taxpayer — and that other suppliers were free to offer the service.
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However, months after the encounter last April, NHS Shared Business Services (NHS SBS), a joint vehicle owned by Hancock’s department and a French IT firm, announced a pilot with Earnd — a payments start-up then owned by Greensill. It later said the scheme was being introduced to “all” NHS organisations.
In practice, it meant that 400,000 employees who used NHS SBS for their payroll services became entitled to use Earnd and download it onto their payroll app. Private firms cannot automatically house their services on such platforms and are typically required to bid to get potentially lucrative access to the health service’s vast workforce. In this instance there was no procurement process or open competition.
Earnd offered the scheme free to workers, who could opt to receive their wages on a daily or weekly basis. The organisation providing the immediate payment in such instances was Earnd, which would later recoup staff salaries from the NHS.
Greensill framed the scheme as benevolent, saying the aim was to help alleviate NHS workers’ stress during the pandemic. But two senior former employees say the plan was to convert the NHS’s future payments into bonds and sell them internationally. They also used the credibility of working with the NHS via the service, and a separate pharmacy scheme agreed by Cameron during his time in office, to demonstrate their credibility with investors.
The disgraced financier Lex Greensill
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The partnership still required individual trusts to opt in: in the end, some of the country’s biggest trusts, such as the Royal Free in London, signed up, and Earnd claimed that a further 21 trusts were taking part or in the process of doing so. But disruption caused by the pandemic slowed progress, and last month Earnd filed for administration.
The company’s collapse poses questions about the circumstances in which NHS SBS entered into the partnership. The entity is not a public body and there was no transparency surrounding the agreement.
Hancock, Harding and Prior will all face questions about what they knew and whether they granted Lex Greensill special treatment or access to officials.
After her meeting with Greensill, Harding is understood to have introduced the banker to Sir James Mackey, her predecessor as chief executive of NHS Improvement. He now runs an NHS trust at which he considered introducing the scheme. It did not ultimately proceed.
Last night NHS England said it did not take the proposals forward. Instead the scheme was rolled out with the support of NHS SBS, which is controlled by central government and a private company.
An NHS spokesperson said: “The NHS has a duty to support staff while using taxpayers’ money wisely, so officials do meet organisations that may be able to provide good-value services which are effective, and when ideas are taken forward, contracts are put through the appropriate and transparent tendering processes. The proposals were not taken forward in this case.”
The Department of Health said: “The wellbeing of NHS staff is the top priority of the department and the health secretary. Our approach was and is that local NHS employers are best placed to decide how different pay flexibilities fit with their overall pay-and-reward offer for their staff.”
A source close to Greensill claimed he did not intend to make profit from the Earnd-NHS partnership.
