Dark Money Investigations: News

Fresh lobbying row after minister fails to declare ownership of PR firm

Exclusive: Government labelled a ‘cesspit of sleaze’ after Tory MP Paul Scully failed to declare his private company in the register of interests

Martin Williams
21 April 2021, 11.26am
Tory minister Paul Scully has failed to declare his ownership of a PR firm
Russell Moore / Alamy Stock Photo

A government minister could face a parliamentary inquiry after failing to disclose that he owns a private PR company.

Parliamentary rules require MPs to declare any significant shareholdings, but small business minister Paul Scully has not declared his ownership of a public relations firm that he set up in 2019.

A government spokesman said the company had never traded or paid Scully a salary. But official records say it is “active” – and without any transparency it’s impossible to check what the business has been doing since 2019.

Opposition MPs have criticised Scully for failing to follow parliamentary rules. openDemocracy understands an MP is now considering making a complaint against Scully with the Parliamentary Commissioner for Standards.

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Scully is the owner and sole director of Lamarr Project Ltd, a “public relations and communications” business which he set up in 2019.

Parliament’s transparency rules state that MPs should declare any shareholdings that “amount to more than 15% of the issued share capital of that company” – even if no salary is paid.

It comes amid a growing scandal over David Cameron’s efforts to lobby the government for Greensill, the failed finance company. Seven inquiries are now probing the relationship between ministers and private businesses, while the government has also faced repeated accusations of cronyism and transparency failures.

How many more examples do we need before government ministers understand that they need to come clean?

“Yet another minister has failed to meet even the most basic transparency requirements,” said Labour MP Margaret Hodge, former chair of the Public Accounts Committee. “Parliament and the public have a right to know this key information.

"How many more examples do we need before government ministers understand that they need to come clean and be fully transparent with us?”

As well as disclosing their shareholdings, MPs are expected to make public anything that “might reasonably be thought by others to influence his or her actions or words”. A guide to the rules explains: “This might include an unpaid employment or directorship, or directorship of a company not currently trading.”

Scully’s undeclared company is the latest in a string of government transparency failures that have sparked accusations of sleaze. Last month openDemocracy revealed a “scandalous” breach of the Ministerial Code after the government failed to publish an updated register of ministerial interests for months, allowing large payments to ministers have been kept secret.

Michael Gove was also urged to “come clean over whether or not he misled Parliament” after claims he made about appointing a new government ethics adviser.

Responding to news of Scully’s undeclared PR company, Labour said: "The minister has legitimate questions to answer and given the wider issues of Tory sleaze he would be wise to be totally upfront now."

Fleur Anderson, a member of Labour’s shadow cabinet, told openDemocracy: "What are they all hiding? The government can't keep treating voters with contempt and must at least meet the very minimum required of them in the Ministerial Code and reveal any potential conflicts of interest.

"This is yet another reason why there needs to be an up to date financial Register of Ministers' Interests which the Conservatives have been deliberately delaying.”

This Tory government is mired in a cesspit of sleaze and cronyism they can't run away from

The SNP’s Pete Wishart also criticised Scully, saying the government had become a “cesspit of sleaze and cronyism”.

He said: “This is just the latest on top of the Greensill scandal, COVID and NHS contracts for Tory donors and family members, and the personal intervention from Boris Johnson at a Saudi prince’s request all prove that this Tory government is dominated and driven by cronyism – and the people of Scotland want nothing to do with it.

“This Tory government is mired in a cesspit of sleaze and cronyism they can't run away from – and the scandals keep coming.”

A government spokesman said: “Minister Scully has carried out no remunerated employment through the Lamarr Project Ltd since his appointment and the company has never traded.

“The Ministerial Code sets out the process by which Ministers should declare and manage potential conflicts of interest. Minister Scully complied with the obligations to declare and manage potential conflict of interests as set out in the Ministerial Code in full following his appointment as a BEIS Minister.”

It is not the first time Scully has faced criticism over lobbying and PR. Before he joined parliament, he co-founded a business called Nudge Factory which is now listed on the official lobbying register.

It boasts of “extensive experience of working across national and regional political environments, from engaging with Secretaries of State to liaising with local authorities”.

Nudge Factor has worked for clients including British American Tobacco and Imperial Tobacco UK, as well as some of Britain’s biggest property companies, such as Hammerson plc and Alumno Group.

Nudge Factory previously claimed that Scully took a “clean break” from the business when he was elected as an MP in 2015, and has not worked for the company “in any way since February 2015”.

But Scully’s own financial declarations say that he switched to an “unpaid and informal” role as non-executive partner of Nudge Factory Ltd in June 2015 and continued to own shares.

According to Companies House, he did not officially resign as a director until October 2017.

Records show that his ex-wife, Emma Scully, whom he divorced last year, took over as finance director and company secretary, where she remains in post.

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