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Boris Johnson’s new ethics adviser works for arms company

Exclusive: Lord Geidt, tasked with clearing up government sleaze scandal, is a paid adviser to an arms company with history of corruption allegations

profile2.jpg Seth Thévoz close-up Peter Geoghegan
Martin Williams Seth Thévoz Peter Geoghegan
28 April 2021, 4.13pm
Boris Johnson's government's new ethics adviser is under fire for links to arms company, BAE
PA Images / Alamy Stock Photo

The government’s new ministerial ethics adviser, Lord Geidt, is paid by the global arms company BAE Systems, openDemocracy can reveal.

As former private secretary to the Queen, the government said Christopher Geidt had a “distinguished record of impartial public service” and would clear up the sleaze scandal engulfing Westminster.

But Geidt is also a member of the International Advisory Board for BAE Systems, which has long faced allegations of corruption and bribery.

The newly appointed independent adviser on ministerial interests also holds paid positions at telecoms company Theia Group Inc, and multi-billion-pound asset management giant Schroders PLC, which has wide-ranging financial interests across a huge range of sectors, according to the Register of Members Interests.

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Opposition MPs have raised concerns about conflicts of interests between Geidt’s “inappropriate” commercial roles and his new job as Johnson’s ethics advisor.

BAE has been repeatedly criticised for selling weapons to Saudi Arabia, and was recently accused of being party to war crimes in Yemen.

It is also a major government contractor, having won billions of pounds worth of deals from ministerial departments since Boris Johnson became prime minister. They include a series of Test and Trace contracts from the Department of Health, valued at more than £7.9m.

Records produced by Transparency International also show that BAE Systems has enjoyed more access to government ministers than any other company in the past ten years, with at least 209 meetings since 2012. This year, it has also employed two private lobbying firms, including Finsbury Group – an agency founded by the brother of former Conservative home secretary, Amber Rudd.

It's ironic that the new independent adviser on Ministers’ Interests has many declarable interests of his own

Labour MP Margaret Hodge, the former chair of the public accounts committee said: “It is inappropriate for the ethics adviser, Lord Geidt, to have commercial interests that could come into conflict with the role. Especially when those interests relate to a company in receipt of major public contracts and millions in taxpayers' money.”

As the government’s adviser for ministerial ethics, Geidt will be tasked with handling the mounting sleaze and corruption scandal surrounding Downing Street.

While the government’s ethics adviser might normally be a serving civil servant, free from any outside financial interests, openDemocracy understands that Lord Geidt will continue his work for private companies.

His appointment also means that an updated list of ministers’ financial interests can now be published – finally revealing any private donations made to Johnson for the refurbishment of his flat. It will also reveal the outside earnings of more than a hundred ministers since July 2020.

The Cabinet Office said Geidt will not be involved in, or have sight of any government contracts or commercial issues.

Scottish National Party MP Alison Thewliss said: “While it's good to see the UK Tory government finally getting round to appointing an independent adviser on Ministers’ Interests, it's pretty ironic that Lord Geidt has many declarable interests of his own.

“With the Tories riddled with conflicts of interest, it's more important than ever that the person appointed to uphold the Ministerial Code and oversee the behaviour of those ministers is beyond question.”

Former shadow chancellor John McDonnell said: “With Lord Geist not being a civil servant but having such a wide range of commercial interests with government contractual links, it’s difficult to see how inevitable conflicts of interest can be avoided.”

BAE Systems sold £15bn worth of arms and services to Saudi Arabia’s military during the country’s 2015-2020 bombing campaign in Yemen. In 2019, it was accused of being party to war crimes, after schools, hospitals and civilians were hit.

A court ruled that UK sales to the repressive regime were unlawful, saying the government had made no attempt to assess “whether the Saudi-led coalition had committed violations of international humanitarian law in the past, during the Yemen conflict”.

Geidt will not be allowed to investigate anything unless the PM asks him to do so – even if the prime minister is the person accused of wrongdoing

The arms company agreed to pay out £300m in penalties in 2010, following long-running corruption investigations. It admitted to false accounting and making misleading statements in relation to allegations of corruption.

A number of former officials and senior civil servants have taken up posts at BAE system after leaving office. The ‘revolving door’ between government and business has been criticised recently during the scandal over David Cameron’s lobbying for the failed financier Lex Greensill.

‘Scandalous’ hush-up

The ethics adviser role has been vacant ever since the previous holder, Alex Allan, quit in November over the prime minister’s refusal to take action on his inquiry into bullying allegations against home secretary Priti Patel.

Allan concluded that Patel’s conduct “amounted to behaviour that can be described as bullying”. But Johnson, as the sole arbiter of the rules, said Patel had not breached the ministerial code and refused to sack her.

Without an ethics adviser for more than five months, the government delayed publication of the register of ministerial interests, which meant the entire government was in breach of the rules.

The ‘scandalous’ hush-up allowed private donations made to Johnson for the refurbishment of his flat to be kept secret for months.

Today, the Electoral Commission launched an investigation into the funding, saying it had “reasonable grounds to suspect that an offence or offences may have occurred”.

Limited powers

With growing calls for transparency over financial interests in government, there is concern that the new adviser’s terms of remit have barely changed from those of his predecessor

Lord Jonathan Evans, the chair of the Committee on Standards in Public Life, had previously made a formal recommendation that the system needed to change, to let the independent adviser “initiate” their own investigations.

Under current rules, Geidt will not be allowed to investigate anything unless the prime minister explicitly asks him to do so. And this applies even when the prime minister is the person accused of wrongdoing.

Margaret Hodge told openDemocracy: “The current scope and remit for the ethics adviser are hopeless. Under the current rules only the prime minister can initiate an independent investigation into wrongdoing in government, including against his own conduct.

“Given the number of serious allegations the prime minister faces, this poses huge challenges. If the terms of references do not change radically then the position is completely worthless.”

Given the serious allegations the PM faces... if the adviser's remit does not change then the position is worthless

Evans’ recommendation had been met with widespread support, including from Allan, who said the reform was needed. Parliament’s Public Administration & Constitutional Affairs Committee also came out in support of the reform. And when the committee grilled cabinet secretary Simon Case on Monday, he, too, indicated that he thought it was a good idea.

Yet the allegedly ‘new’ terms of reference fall well short of letting the independent adviser “initiate” investigations. Instead, Geidt will merely be able to “advise” the prime minister – who can then reject that advice.

Alistair Graham, a former chair of the Committee on Standards in Public Life said: "I'm not surprised. I suspect that most prime ministers would like a right of veto, and Johnson in particular."

Johnson has experience of ignoring formal advice. In December 2020, he became the first prime minister in history to overrule the Lords’ vetting body, the House of Lords Appointments Commission (HoLAC), when it deemed that billionaire Tory donor Peter Cruddas was “improper” to be a peer. It came after an Appeal Judge ruled that Cruddas had offered fellow donors favourable access to ministers in exchange for Tory party donations.

Prime ministers Tony Blair, Gordon Brown, David Cameron and Theresa May had always followed HoLAC recommendations blocking “unsuitable” peerage nominees – even when they strongly disagreed with them. But Johnson simply ignored HoLAC’s advice. Similarly, under these ‘new’ terms, Johnson will remain free to ignore Geidt’s advice over ethics and financial interests.

Downing Street confirmed that Geidt will be undertaking his own investigation of the Number 11 flat refurb, now known as the ‘Cash For Curtains’ scandal.

Speaking in the Commons today, Johnson said he had “personally” paid the refurb bill, but would not say who had paid initially, nor if he had received any money to cover the costs.

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