It was revealed in The Sunday Times recently[1]The Times; The BBC chairman, the prime minister and the £800,000 loan guarantee that while Boris Johnson was Prime Minister he was offered a loan of up to £800,000.
This is on top of Johnson’s earnings of £164,080 as Prime Minister[2]Politics.co.uk: What was Boris Johnson’s salary as Prime Minister? which is made up of £84,144 for being an MP and £79,796 for his role as PM.
As Prime Minister Johnson had use of the flat above 10 Downing Street and the Buckinghamshire country residence called Chequers.
So if Johnson is earning almost five times the average wage of a UK earner, why would he need a loan? I mean we know it wasn’t for the gold wallpaper used in the Number 10 flat refurb as this was funded by Lord Brownlow in what became known as “WallpaperGate”[3]Independent: Wallpapergate: Leaked £200,000 list reveals Boris Johnson’s flat renovation plans included £7,000 rug and £3,675 trolley although Johnson was responsible for paying back £52,000 to a Conservative donor.
One explanation is a drop in his income since he became Prime Minister back in December 2019. Between July 2018 and July 2019 Johnson was earning over £20,000 a month as a columnist for the Daily Telegraph[4]BBC News: Why would Boris Johnson need an £800,000 loan?.
There was also a divorce and a child support settlement he had to cover as well which lead to him revealing to a friend in 2017 that he was “running out of money”[5]BBC News: Why would Boris Johnson need an £800,000 loan?.
Records also show that he received money from book royalties and hundreds of thousands on speaking engagements – two examples of which are £122,899.74 on 22 March 2019 received from Living Media India Limited and £25,297.62 on the 18th April 2019 from Banque Pictet & Cie SA[6]Parliament UK: The Register of Members’ Financial Interests As at 5 November 2019 – Boris Johnson.
When Johnson became PM, the obviously lucrative speaking engagements would have been stopped taking away a major portion of his income, with some reports stating that for the 2 years between 2017 and 2019 the total earned amounted to – in an odd coincidence – £800,000.
So what’s the problem? Johnson was just trying to take out a loan to cover his lost earnings, right?
Well, this is where it starts to get a bit murky or, as the Labour Party called it “a quagmire of sleaze”[7]The Sun: BORIS ‘LOAN’ CLAIMS Boris Johnson referred to parliament standards watchdog over claims BBC chairman “helped him get £800,000 loan”.
Before getting the loan, Johnson took financial advice from Richard Sharp who was a former Goldman Sachs banker and an advisor to Johnson during his time as Mayor of London.
Sharp linked Johnson with Sam Blyth (a distant cousin of Johnson) who was reportedly to act as guarantor for the £800,000 loan.
Johnson, Sharp and Blyth then allegedly had dinner at Chequers before the loan was fully arranged.
Sharp was, at the time, on the short list for the role as BBC Chairman. The Prime Minister and Culture Secretary are advised by a panel consisting of four members on the appointment but the ultimate decision lays with the PM[8]Daily Mail: Calls for BBC chairman Richard Sharp to quit amid reports he ‘helped arrange guarantee on £800,000 loan to fund Boris Johnson’s lifestyle – weeks before the then-Prime … Continue reading.
While anyone can apply for the role of BBC Chair, they cannot be considered for the role if they fail to declare “any conflict of interest”.
Similarly, ministerial code sets out that “Ministers must ensure that no conflict arises, or could reasonably be perceived to arise, between their public duties and their private interests, financial or otherwise.”
It would appear that the arranging of a loan, even if Sharp was involved tangentially could be seen as a conflict of interest in his appointment as BBC Chair – who Johnson put forward as his selection on 6th January 2021.
Sharp has also donated over £400,000 to the Conservative party over 20 years and has invested in a Russian Crypto firm through a company based in the Cayman Islands.
It is reported that the loan was finalised in February 2021, the same time that Sharp began his new role at the BBC[9]Daily Mail: Calls for BBC chairman Richard Sharp to quit amid reports he ‘helped arrange guarantee on £800,000 loan to fund Boris Johnson’s lifestyle – weeks before the then-Prime … Continue reading.
All parties deny that there was any conflict of interest and that the dinner occurred as Sharp and Johnson were friends and Blyth and Johnson are related. They claim that everything was properly registered on “the advice of officials”[10]The Sun: BORIS ‘LOAN’ CLAIMS Boris Johnson referred to parliament standards watchdog over claims BBC chairman “helped him get £800,000 loan”.
It is important to note though that the Cabinet Office team that oversees ethics had formally notified Johnson to stop asking for Sharp’s advice in December 2020 given that Sharp was in the running for BBC Chair[11]Indy100: What’s the deal with Boris Johnson, the BBC chairman and an alleged £800,000 loan? – it would appear this request was ignored.
On the 24th January it was reported that the BBC were looking the appointment of Richard Sharp following a complaint from Labour calling for the hiring to be looked in to, however, this is merely a review into whether conflicts of interest were declared and not what led to his appointment in the first place[12]BBC News: Richard Sharp: Watchdog review begins into BBC chairman’s hiring.
SNP MP John Nicolson, who sits on the Culture select committee which interviewed Sharp over his £400,000 donations said Sharp failed to mention his involvement in the loan and stated “Even by the grubby standards of this government, it’s all a bit banana republic is it not?”[13]BBC News: Richard Sharp: Watchdog review begins into BBC chairman’s hiring.
While many support Richard Sharp’s credentials in the role of BBC Chairman, the loan debacle casts a shadow over the appointment and with Johnson to face further scrutiny it remains to be seen what impact this will have on either man’s positions and whether they are still tenable when the smoke finally clears.
Katy is the editor-in-chief of FlippingHeck.com a blog about Self-Improvement, Productivity and Small Business Tips. When she’s not working, she enjoys gaming, making music and Reviewing Things.
