Labour attacks Hancock ‘cronyism’ over 15% stake in NHS supplier

UK health secretary Matt Hancock was on Friday accused by the opposition Labour party of “cronyism” after he declared he owned a minority stake in a company that is an approved supplier to NHS England and has won contracts with its Welsh counterpart. 

Topwood Limited, a company specialising in shredding and storage solutions, was placed on the NHS Shared Business Services framework in 2019, which allows the company to bid to provide services to NHS England. The link between Hancock, who is responsible for England’s health service, was first reported by the Health Service Journal.

Topwood was also awarded £300,000 in contracts by NHS Wales earlier this year, the Guido Fawkes website first reported, although Hancock is not responsible for the Welsh part of the health service.

Hancock declared that he held “over 15 per cent of issued share capital” in the company “under a delegated management arrangement” in the latest parliamentary register of interests as of March 2. The rules require all MPs to declare any financial interests that “others might reasonably consider to influence his or her actions or words” within 28 days. The register does not specify that Hancock’s sister, Emily Gilruth is named as a director of the company on Companies House.

Companies House documents show that 20 shares in Topwood were transferred to Hancock on February 1.

Labour’s shadow health secretary Jonathan Ashworth described the revelations as “shocking”, adding: “Sadly I suspect no one is surprised any more at the cronyism at the heart of this government.”

Justin Madders, the shadow health minister, said Hancock had “serious questions to answer” and called for a full inquiry and “immediate publication of all documents relating to Topwood’s acceptance on to the framework contract in 2019.”

The government said the health secretary had “acted entirely properly”, adding: “All declarations of interest have been made in accordance with the Ministerial Code. Ministers have no involvement in the awarding of these contracts, and no conflict of interest arises.”

Under the Ministerial Code, ministers have a “personal responsibility” to “decide whether and what action is needed to avoid a conflict or the perception of a conflict”, they must also submit a full written list of any interests that could result in a conflict of interests to the relevant permanent secretary — the most senior civil servant in a government department. 

Topwood declined to comment further on Friday about the company’s involvement with NHS England. But on Thursday evening, Tom Gilruth, its managing director, confirmed the contracts with NHS Wales and told the Financial Times there was “no conflict at all” given Hancock’s part-ownership.

An ally of Hancock said the health secretary was not actively involved in the running of the company and discussed the shares with the permanent secretary before accepting them. Neither Hancock nor the department for health and social care were involved in the awarding of the contracts to Topwood.

The revelations come with lobbying within Whitehall under intense scrutiny following the involvement of former prime minister David Cameron with failed finance company, Greensill Capital.

Prime minister Boris Johnson has announced a government probe into the scandal by Nigel Boardman, a former city lawyer., earlier this week. The public administration committee and the Treasury and public accounts committees have also started probes.

Civil servants are also under scrutiny. Speaking at a parliamentary select committee on Thursday, Eric Pickles chair of lobbying watchdog, the Advisory Committee on Business Appointments, warned that there appeared to be few “boundaries” between civil servants and the public sector and called for the system to be reformed.