The former head of Whitehall procurement became an adviser to Greensill Capital while still working as a civil servant in a move approved by the Cabinet Office, it has emerged.
Downing Street has announced an independent review into how the failed firm secured Government contracts, following a series of reports on former prime minister David Cameron’s lobbying on behalf of the company.
Correspondence between the Cabinet Office and the head of the official Advisory Committee on Business Appointments (Acoba) has revealed that Bill Crothers joined Greensill as a part-time adviser to the board in 2015.
Mr Crothers was still working as a civil servant when he took up the advisory role, a move which he said was approved by a conflicts of interest policy and “supported by the Cabinet Office leadership”.
He left the civil service later that year, after three years as the Government’s chief commercial officer, and subsequently became a director at Greensill.
Labour called it an “extraordinary and shocking revelation” and stepped up demands for a parliamentary inquiry into the “Greensill scandal”.
A Cabinet Office spokesman said the “wide-ranging” independent review into the financial firm, led by senior lawyer Nigel Boardman, will also consider the situation surrounding Mr Crothers.
It came after The Times and Financial Times reported that Mr Crothers joined the board of the financial firm in 2016, less than a year after leaving his post as the government’s chief procurement officer.
The papers reported that he failed to obtain permission from Acoba, which is supposed to vet private sector appointments by former ministers and senior servants within two years of leaving their posts.
In a letter to civil service chief operating officer Alex Chisholm following the reports, Acoba chairman Lord Pickles questioned why the committee had not received an application from Mr Crothers in relation to his role at Greensill.
In correspondence which was published on Tuesday, Mr Chisholm said Mr Crothers had taken a role advising the board of Greensill in September 2015 while employed as a civil servant.
The move was approved through the Cabinet Office’s “internal conflicts of interest policy, which advises on how to address real or perceived conflicts of interest”, according to Mr Chisholm.
He added that as Mr Crothers was already working in an advisory capacity to Greensill before he left the civil service in November 2015, he was not required to submit an application to Acoba when he became a director in 2016.
This is an extraordinary and shocking revelation. The Conservatives have weakened the rules so much they may as well rip them up and start againRachel Reeves
In a letter to Lord Pickles, Mr Crothers claimed he did “completely respect the required process” and had been told no application was required to be submitted to the committee.
“It was seen as a way of me transitioning back into the private sector and was supported by the Cabinet Office leadership,” Mr Crothers said in the letter.
“This advisory role was not seen as contentious, and I believe not uncommon. I then left the civil service in good stead and with best wishes.”
In response, Lord Pickles criticised the “lack of transparency” around Mr Crothers’ part-time employment with Greensill, and urged the Cabinet Office to publish the conflicts of interest policy.
Shadow chancellor of the Duchy of Lancaster Rachel Reeves said: “This is an extraordinary and shocking revelation.
“The Conservatives have weakened the rules so much they may as well rip them up and start again.
“They must be kidding themselves if they think the current checks and measures they’ve got in place are working.
“They need to strengthen rules now and get everything about the Greensill scandal out in the open with a proper parliamentary inquiry.”
Greensill later collapsed into administration but not before Mr Cameron unsuccessfully lobbied ministers on its behalf for support through the Government’s Covid Corporate Financing Facility (CCFF).
The review will examine how the specialist bank – founded by Australian financier Lex Greensill – was granted access to a Covid loan scheme for businesses, putting hundreds of millions of pounds taxpayers’ money at risk.
A Cabinet Office spokesman said: “We have responded to the initial letter from Lord Pickles and will respond to his further letter in due course.
“The Boardman review into Greensill Capital and supply chain finance will be wide-ranging and will also consider the issues raised so the public can judge whether they were appropriately handled at the time.”