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Monday, November 16, 2020

Living in a chumocracy

The Sunday Times carried an important article yesterday in which it revealed that the government has awarded £1.5bn of taxpayers’ money to companies linked to the Conservative Party during the coronavirus pandemic. None of the firms were prominent government suppliers before this year.

They say that in normal times, ministers must advertise contracts for privately provided services so that any company has a chance of securing the work. A person’s connections are not supposed to help. The government is also legally required to publish details of awarded contracts within 30 days, so the public knows how its money is being spent.

However, during the pandemic, neither has happened. Facing a sudden need to deliver millions of items of PPE, test kits and vaccines, ministers used emergency procedures to award work directly:

According to Tussell, a data provider on official spending, Whitehall departments have taken an average of 72 days to publicise who has received money, meaning public debate has often moved on before decisions can be scrutinised.

It is a less straightforward situation than the bribery or “cash-for-questions” scandal investigated by Nolan. As the government mounted a war effort to combat Covid-19, it has instead resembled more of a “chumocracy”.

This is a world in which ministers have turned to friends with links to the Conservatives because of a mixture of trust, convenience and a panicked need to deliver, rather than a desire to benefit themselves financially.

The end result, however, is arguably similar: friends of the Conservatives have played a central role in responding to the pandemic, securing high-profile positions and contracts along the way.

This pattern of conduct became visible in May, with Britain in lockdown, when Boris Johnson and the health secretary Matt Hancock turned to trusted contacts to run parts of the pandemic response. Baroness Harding, a Conservative peer and the wife of John Penrose, a Tory MP, was appointed to run NHS Test and Trace. The former TalkTalk executive, 53, had spent a career in the private sector before Hancock awarded her the position, announcing it in a tweet.

In the same month Kate Bingham, a family friend of Johnson’s whose husband, Jesse Norman, is a Tory MP and Treasury minister, was appointed to oversee the vaccines taskforce. She accepted the position after decades in venture capital, having received a personal call from the prime minister. According to a speech that Bingham, 55, gave to a group of US venture capitalists, she responded to Johnson’s offer by saying: “I’m not a vaccine expert, why should I be the right person?” Then there is the layer of “chums” who have been brought in as advisers and intermediaries between Whitehall and outside companies. Some have sat in on meetings with ministers and contacts who go on to secure lucrative contracts.

In March, for example, Lord Feldman of Elstree, former chairman of the Conservative Party, was quietly appointed as an unpaid adviser to Lord Bethell, a hereditary peer and nightclub baron turned health minister.

According to a government source, Feldman’s role, which was never announced publicly, was to assist Bethell, 53, in his “work with industry” during the pandemic.

That included sitting in on a phone call on April 6 between Bethell and Meller Designs, which supplies high-street shops with home and beauty products. It is owned by David Meller, who would have been a familiar face to Feldman.

Meller, 60, is a Tory donor who has given more than £63,000. Most of that came during Feldman’s spell as chairman, when he was responsible for fundraising. Meller Designs later secured £163m in PPE contracts.

Three days later, on April 9, Owen Paterson, a Conservative MP and former secretary of state for Northern Ireland, took part in a phone call with Bethell and Randox, a Northern Irish diagnostics company. Randox pays Paterson £100,000 a year as a consultant.

It is also linked to Harding, who sits on the board of the Jockey Club, the horse racing body. Its biggest annual event, the Grand National, is sponsored by the company. Paterson’s late wife, Rose, also sat on the Jockey Club board.

It is unclear why Paterson, 64, was on the call, but government sources say it was a “courtesy call” to discuss testing and the MP was involved because of his role for Randox. The company has received £479m in government testing contracts this year, acquiring more orders even after it had to recall half a million tests because of safety concerns.

Whole organisations have achieved remarkable penetration within Whitehall during the pandemic, often under the cloak of secrecy. They include Portland Communications, a political lobbying firm whose clients include HSBC, Pfizer and BAE Systems. It employs a number of former Tory advisers.

In March its chairman, George Pascoe-Watson, was parachuted into government, again without any announcement, to advise Harding and Bethell on strategy and communications. It is understood that Pascoe-Watson, a former political editor of The Sun, participated in their daily calls, prompting civil servants to raise concerns about “appropriate channels”. 
A source said: “Nothing happened. They loved him.” 

Pascoe-Watson appears to have made the most of his access, sending advance information about policy to paying clients. He also defended the government against criticism on social media, while failing to disclose his role.

For instance, when The Sunday Times revealed that Bingham had charged the taxpayer £670,000 for boutique PR consultants last week, he responded on Twitter: “Only in this country could we shaft a true hero.”

He also said that Bingham and Harding, whom he advises, should be cherished. “We should celebrate that two highly distinguished women are in critical roles in this country,” he said.

For months, Pascoe-Watson was joined by Lord O’Shaughnessy, a Tory peer who served as David Cameron’s policy chief. Today it can be revealed that he was both a paid “external adviser” to the Department of Health and Social Care (DHSC) and a paid Portland adviser at the same time.

The apparent conflict of interest went further when, in May, O’Shaughnessy took part in a call with Bethell and Boston Consulting Group (BCG), a client of Portland’s. BCG has received £21m in Covid-19 contracts, with some of its advisers paid £7,000 a day.

Go over to the Times website and read the full article. It is little wonder that the former head of MI5, Lord Evans of Weardale said, in a speech in his role as chairman of the committee on standards in public life: “the perception is taking root that too many in public life, including some in our political leadership, are choosing to disregard the norms of ethics and propriety that have explicitly governed public life for the last 25 years and that, when contraventions of ethical standards occur, nothing happens”.

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