UK Car Lending

Greensill tried to use NHS Pay’s ‘giveaway’ as leverage to sell supply chain finance

Greensill Capital planned to use an advance payment scheme for health workers as leverage to secure other more lucrative work with the NHS, according to people familiar with the matter and a presentation from the financial group which has since collapsed .

Greensill, who fell under administration last month and has since sparked a lobbying scandal centered on company adviser David Cameron, last year introduced a program to allow NHS staff to cash their paychecks little by little every day.

Founder Lex Greensill announced the program as the country was hit by the pandemic, saying it was his way of giving NHS workers the equivalent of a ‘free cup of tea’.

Behind the scenes, however, Greensill Capital had previously embarked on a tour of the UK‘s NHS trusts with the aim of transforming the system, called Earnd, by paying for business, including channel funding programs. supply which were the group’s flagship product.

At the center of the effort to make money with the NHS were two Greensill employees: Bill Crothers and Jonathan Lewis.

Crothers, the UK government‘s former purchasing manager, is now under surveillance after it emerged he took a job at Greensill while still a public servant.

Lewis, Earnd’s Managing Director in charge of public sector clients, took a new job last month at NHS Shared Business Services, a joint venture between the UK Department of Health and French information technology company Sopra Steria.

A presentation given to a trust in December 2019 – titled ‘Adding Value to the NHS’ – was explicit that the free funding enabled Greensill to offer more complex and profitable financial products, stating: ‘The early payment of employees n ‘is just the beginning’. .

The December 2019 presentation highlighted Greensill’s ties to the bureaucracy. One slide stated “It is important for us to do substantial business with HMG [Her Majesty’s Government]”.

Another described Lex Greensill as having previously been “senior advisor to British Prime Minister and US President Barack Obama” – even though the financier has only met the former US leader once, according to people familiar with the matter. .

Former Prime Minister David Cameron was a paid adviser to Greensill © Ben Cawthra / LNP

At this point Greensill already had a main contract involving the NHS, offering what is known as supply chain finance to British chemists under the ‘Pharmacy Early Payments Scheme’. From 2018, the company paid pharmacists a discount for the drugs they dispensed, before collecting full payment from the NHS later.

The 2019 slideshow showcased supply chain finance as a way to strengthen the bottom line of an NHS Trust. He said the financial product was “no or very low risk for a trust”, would require “no further purchase” and assured Greensill “would not make a high return” from the deal.

The presentation also touched on more speculative patterns. A slide titled ‘The Future (Salary Stretching)’ described the company’s ambition to alleviate the financial hardship of poorly paid NHS staff: ‘Greensill cannot influence the amount that NHS workers are paid. However, if the poverty premium were removed, low-paid staff could experience a net salary increase of up to 3%. “

The pitch was oblique on what that might imply. Another slide – illustrated with pictures of a car, iPhones and a pork chop – explained that Greensill wanted “to allow lower paid staff (and everyone) to increase their wages.”

Greensill Capital has often portrayed Earnd as an element of selflessness from which he made no profit, charging no fees to NHS trusts or their employees.

He pointed to the scheme during a lobbying effort to obtain government funding, according to documents released by the Treasury on Thursday evening.

In an email to Treasury officials in March 2020, sent during an unsuccessful attempt by Greensill to access a Bank of England emergency lending program, the company founder described Earnd as ” our small contribution to the country in this period of unprecedented needs ”.

In an attempt to pressure Australian Prime Minister Scott Morrison to implement a similar program, Greensill pledged to “bear the cost of a gift to the nation”.

Earnd Advertising

Earnd has been touted as a financial product that could help NHS staff

Crothers was in attendance at a private drink between Lex Greensill and Health Secretary Matt Hancock in October 2019, which the Sunday Times said was hosted by former Prime Minister David Cameron. Cameron, a paid advisor to Greensill, is now embroiled in Britain’s biggest lobbying scandal in a generation.

In an April 2020 blog post, Lewis explained how the company could help NHS staff weather the ‘coronavirus crisis’, describing its role as using’ Greensill’s expertise to improve the financial situation of the 25 % of NHS staff who are poorly paid ”.

Greensill’s Earnd product was available to hospital staff through an app from NHS Shared Business Services, the joint venture Lewis now works for. A now-defunct webpage said it could help NHS staff overcome financial hurdles such as ‘rent due before payday or a forgotten MOT bill’.

Greensill Capital, Lewis and Crothers did not respond to requests for comment. NHS SBS said: “As with other similar providers of flexible compensation solutions, NHS Trusts have contracted directly and on an individual basis with Earnd.”

Some NHS trusts actively promoted the service just weeks before Greensill collapsed. The Mid and South Essex NHS Foundation Trust emailed staff in February to promote Earnd, who carried rave reviews from NHS employees.

“I think Earnd makes you feel more relaxed and gives you an added dimension to your financial structure,” said a quote attributed to a staff member at a maternity hospital. “It just gives you a feeling of extra freedom.”

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