“Crown representatives” are directors of other companies and Tory donors

“Labour has warned that the crown representatives who are supposed to police public sector suppliers such as the failed construction company Carillion face potential conflicts of interest, as its own research showed that several hold external directorships and one was a Tory donor.

A dossier produced by the party showed that the former admiral Sir Robert Walmsley, who is responsible to the taxpayer for monitoring the outsourcing multinational Serco, also sits on the board as senior independent director of two defence contractors, Ultra Electronics and Cohort plc.

Daniel Green, the crown representative for the energy sector, is a Conservative donor who has given £330,000 to the party and £15,000 to Theresa May’s successful leadership campaign in 2016. His profile on the LinkedIn network says he is the chief executive of a private equity firm, Liquid Business.

Jon Trickett, the shadow minister for the Cabinet Office, said such relationships amounted to “an astonishing conflict of interest and yet other example of the chumocracy”. Some of the crown representatives, he added “turn out to be people who actually work for companies that have contracts with the government”.

The crown representative system was introduced under the coalition in 2011. They are supposed to work across government on a part-time basis to act as a focal point for key companies or groups of companies who supply the public sector. When a company is in trouble, or deemed high risk, a crown representative is supposed to work with that company to develop an improvement plan.

The system has come into acute focus after Carillion’s liquidation. Julie Scattergood, the crown representative responsible for Carillion, retired last summer and was not replaced until autumn – by then the company had delivered profit warnings in July and September.

Sean Collins, the crown representative for Vodafone and the telecoms infrastructure provider Arqiva, is a non-executive director at JT Group, providing telecoms expertise in the Channel Islands. William Priest, the representative for technology services companies IBM and DXC, is a non-executive director at Connexin, a wireless broadband company.

Carillion collapsed a week ago leaving 28,000 staff facing uncertain futures as the government and private sector companies scrambled to take on its contracts. It had a £900m deficit in its pension fund at the time of collapse and it is unclear if employee pensions can be paid out in full.

The chief secretary to the Treasury, Liz Truss, said on Sunday that the government did not know how much the closure would cost the taxpayer. When Truss was asked on ITV’s Peston on Sunday if it would cost “hundreds of millions”, she said: “Well, it will be a significant amount of money, it’s been a serious issue.”

A government white paper designed to give regulators greater powers to block or place conditions on takeovers that are deemed to put pension schemes at risk is also being drawn up for publication in March.

The Cabinet Office did not respond to a request for comment.”

https://www.theguardian.com/business/2018/jan/21/conflict-of-interests-rampant-in-firms-such-as-carillion-warns-labour