More Crony Contracts

With the current government, any pretence at a process or fairness has all but disappeared. Cronyism is alive and kicking in this and previous Tory administrations.

The old mantra, ‘It’s not what you know, but who you know’, is particularly relevant in respect of the awarding of government contracts.  On paper, there are very stringent rules in place. In practice, these rules seem to have been ignored repeatedly, resulting in friends and family of those in power having undue influence and often making themselves, or the companies they represent, rich in the process.

It emerged last year that Education Secretary Gillian Keegan’s partner Michael, 60, was not only a Crown Representative with the Cabinet Office responsible for the government relationships with suppliers, but he also held, at that time, a board role with the IT company Centerprise International. That by itself is enough to suggest a conflict of interest, but between October 2019 and May 2020, the Ministry of Defence gave the IT company 17 contracts worth an estimated £24 million. The Cabinet Office dismissed reports of any conflict of interest, saying he was not involved in the bidding process. After the award, he agreed to remove himself from any discussions regarding bidding for future public sector contracts.

More recent revelations are even more damning. It appears that the deal with Centerprise was paid for from the same pot of cash earmarked to rebuild classrooms at risk of collapse because they contain the potentially deadly concrete.

“As a Twitter, now X, user commented, “Is anyone surprised! Meet Michael Keegan, current husband of Education Secretary, Gillian Keegan. He works as an ‘advisor’ to the government in the crown office so how the feck has his company been awarded millions in public IT contracts?”

That revelation came hot on the heels of the news that Tory MP, Dr Liam Fox, received a £20,000 donation from a Covid-19 testing company that he reportedly recommended to the then Health Secretary, Matt Hancock.

According to an email seen by the BBC and the legal campaign group the Good Law Project, Dr Fox recommended SureScreen Diagnostics to then Health Secretary, Matt Hancock, in 2020.  The company was later awarded a £500 million testing contract by the Department of Health and Social Care.

Lack of transparency in Boris Johnson’s Government

Evidence of a lack of transparency in Boris Johnson’s Government continues, long after he left office. The latest revelation is that the MP Theresa Villiers held the post of Environment Secretary while having over £70,000 in shares in the oil and gas giant, Shell.

Her financial interests in the company were only revealed in August 2023 in the Register of Members Financial Interests, and, according to these records, she only declared them a few weeks earlier.

Good Law Project’s Head of Engagement, Ellie Mae O’Hagan, said: “This is not just another example of the Tories ducking transparency, it also raises serious questions about whether the Government’s duty to protect our environment was completely compromised by a Secretary of State’s financial interests in big polluters in the middle of a climate emergency.”

Some MPs continue to milk the system

A Mirror report has revealed that the Home Secretary Suella Braverman claimed £25,000 in household expenses when she was staying rent free in her parents’ home.

While her expense claims are all within the rules, the Tory MP, who earns £67,505 on top of her MP’s salary of £84,144, has been accused of exploiting a loophole in the system.

The Mirror found that the Home Secretary used the expenses to pay the household bills on her £1.2 million family home in Bushey, Herts.

Braverman reportedly said she “fully funds” the home she stays at in Fareham, Hants, but, according to the paper, she failed to mention it is her parents’ house, which costs her nothing in rent.

Not many will be surprised to learn that Nadine Dorries failed to declare any cash she received from her second job as a TV presenter. The ex-Tory MP didn’t declare a single penny in earnings from nearly a year of presenting a high profile TV show – while largely absent from her day job as an MP.

Meanwhile, research by the Lib Dems revealed Ms Dorries didn’t mention her Mid-Bedfordshire constituency once in any of her Commons speeches since the last election in 2019.

She continued to employ her daughter on a taxpayer-funded salary of up to £49,000, despite her living two hours’ travel from both Ms Dorries’ constituency and from Parliament.

Then there is Prime Minister Rishi Sunak, who was chided by Parliament’s standards guardian last month for failing to declare his wife’s financial interest in a childcare firm that stood to benefit from government policy. Standards Commissioner, Daniel Greenberg, said Sunak broke the code of conduct for government ministers, but said the mistake was “inadvertent” and that the Prime Minister should not be sanctioned for the error. People on social media were quick to recognise the irony in these statements by asking whether not paying their taxes or their parking fines could also be described as ‘inadvertent mistakes’.  

It’s ok for some

The bosses of the UK’s 100 biggest listed companies collected an average £500,000 pay rise last year, while many of the millions of people working for them saw their pay growth fail to keep up with soaring inflation, according to research by the High Pay Centre thinktank published in August, 2023.  FTSE 100 chief executives received an average pay rise of 16% last year, taking their median pay to £3.9m, up from £3.4m in 2021. Pascal Soriot, the CEO of the drug company AstraZeneca, was the highest paid executive last year, collecting £15.3m, up from £13.9m the previous year. Charles Woodburn, the boss of the arms manufacturer BAE Systems, was the second highest paid, collecting £10.7m. In third place was Albert Manifold, the leader of the building supplies company CRH, who was paid £10.4m.

Profits over People – Welsh Coal mine

Another investigation by ‘The Good Law Project’  has found more evidence of a private company protecting the interests of its shareholders over the needs of the local community. The company, Merthyr (South Wales) Ltd, is running a mine still operating in South Wales.

Permission to run coal mines in Wales was given on the condition that the company made deposits in a financial bond to secure restoration and aftercare. But John Major’s Conservative Government allowed some private companies to pay a larger initial cash price to buy a previously nationalised mine in exchange for a 10 year reprieve from having to pay into a restoration fund. Without the mandatory need to set aside funds for restoration, some private companies relied on income from new mining, often as mining extensions, to pay for the restoration of old mining. When that became harder because of the decline in domestic coal demand, along with prices, coal mine operators sometimes either exploited legal loopholes to evade those costs or declared bankruptcy.

 Merthyr (South Wales) has chosen to pay out £49.89m in dividends and royalties to its shareholders, whilst the restoration fund faces a shortfall of at least £50m. It is also using the same tired argument used by other mine owners that as “insufficient funds” have been set aside for restoration, they should continue mining at the site, even though planning permission ended almost a year ago. Estimates suggest that more than 300,000 tonnes have been extracted illegally since September 2022, prolonging an experience residents have described as a “local and environmental disaster”.

The shortfall could result in a huge liability for Merthyr Tydfil council. Having paid for this mine with their health and well-being over the last 16 years, local people face paying once again.

“To say it’s an eyesore is an understatement,” said Val Williams, a social historian who lives nearby.

She told BBC Radio Wales Breakfast: “Promises were made that it would be put back better than it was. I don’t see any possibility of that being fulfilled now, so I think at this moment it’s a lose-lose situation.

“People have lost their jobs and people have got an environmental disaster still left there.”

Charles 111 to get a 45% increase

While working people across all sectors are being made to fight for every penny increase in their take home pay, Charles III is to receive a huge pay rise from the UK taxpayer. According to a Treasury Report released on 20th July 2023, public funding of the monarchy will increase by 45% from 2025. It revealed the royal family’s grant is due to increase from £86m to £125m.

The monarchy’s annual budget, known as the sovereign grant, is pegged against the profits from the Crown Estate.

The review of the royal funding settlement was heavily spun by the Treasury to give the impression that the king would be taking a pay cut so that crown estate funds could instead be spent on public services.

In fact, the report reveals the monarchy is due to receive a huge pay increase, although the rise will not kick in for another two years.

Next year, the sovereign grant will remain unchanged at £86.3m. However, in 2025, the King’s public funding will increase by a projected £38.5m, giving the monarchy an annual stipend of £124.8m. In 2026, it will be £126m.

Lord Turnbull, a former cabinet secretary, Whitehall’s most senior civil servant, who was involved in official discussions over royal financing, accused the Treasury of seeking to obfuscate how the monarchy was funded.

He said that linking the royal finances to the profits of the crown estate was “silly” and was motivated by a desire to promote the idea that the king was paying for himself and was reducing the burden on the taxpayer.

“You get people writing in saying: ‘Isn’t it a good thing that the king is so sensitive to public opinion that he has waived some of the money he could have had?’ I think it’s bollocks. It is deliberate – that’s really what makes me so cross about it. It is a deliberate attempt to obfuscate how the thing works.”

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