The Cabinet Office has insisted all the correct processes were followed when Richard Sharp was appointed BBC chair in 2021, after claims emerged that he had helped then-prime minister Boris Johnson secure a loan.
Sharp, a long-time Conservative donor and former adviser to both Johnson and current PM Rishi Sunak, has asked for a review into his appointment to check all the appropriate guidelines were followed.
Just weeks before he was chosen by Johnson to be the next BBC chair, Sharp was involved in discussions to help secure the then-PM about a loan of up to £800,000, according to reports.
The talks in November and December 2020, by which time Sharp had already reached the final stages of the recruitment process for the BBC role, have also led to questions about cabinet secretary Simon Case’s role in the controversy.
According to the Sunday Times, Johnson’s distant cousin Sam Blyth, a Canadian multimillionaire, offered to be a guarantor for a loan of up to £800,000 in late 2020 after seeking Sharp's advice on the matter. The PM was reportedly in financial trouble at the time, due to divorce and childcare costs and bills for the refurbishment of the Downing Street flat.
In an email to BBC staff, Sharp said his "old friend" Blyth had asked him how he could help Johnson within the rules, "having become aware of the financial pressures" on the then-PM.
Sharp said he then introduced Blyth to cabinet secretary Simon Case. He met Case separately to discuss Blyth and "reminded" the cab sec that he had applied for the BBC job.
"We both agreed that to avoid any conflict that I should have nothing further to do with the matter. Since that meeting I have had no involvement whatsoever with any process," he wrote.
Johnson, Sharp and Blyth also had a private dinner at Chequers, the prime ministerial grace-and-favour home in Buckinghamshire, according to the Sunday Times.
Shortly after Sharp's meeting with Case, the Cabinet Office’s propriety and ethics team wrote to Johnson, asking him to stop seeking the soon-to-be BBC chair's advice about his personal finances because of the forthcoming appointment.
In his memo to staff, Sharp called the row "a distraction for the organisation, which I regret".
He stresssed that he was “not involved in making a loan, or arranging a guarantee, and I did not arrange any financing”.
PM had 'made up his mind' about Sharp's appointment
In November 2020, around the same time discussions began, ITV News political editor Robert Peston reported that ministers were telling prospective applicants: “Don’t waste your time applying, the PM has made up his mind it will be Richard Sharp.”
He was announced as the government’s pick for the £160,000-a-year role on 6 January, 2021, with the Digital, Culture, Media and Sport Committee approving the choice later that month.
Johnson's loan was finalised in February 2021, the month Sharp started his new role. It was not disclosed in the public register of interests as officials felt it was a personal benefit from a cousin and therefore neither a potential conflict of interest nor a“relevant” interest.
Sharp said the BBC Board’s nominations committee will review his appointment when it next meets and said the findings would be published. He did not confirm when the committee's next meeting will be.
Labour had called on the parliamentary standards commissioner to investigate the saga, suggesting Johnson may have breached the MPs' code of conduct by “failing to appropriately declare the arrangement".
Johnson and Sharp have both denied any conflict of interest, while the Cabinet Office said "all the correct recruitment processes were followed".
"Richard Sharp was appointed as chairman of the BBC following a rigorous appointments process including assessment by a panel of experts, constituted according to the public appointments code,” a Cabinet Office spokesperson said.
“There was additional pre-appointment scrutiny by a House of Commons Select Committee which confirmed Mr Sharp's appointment."
MPs 'expressed concerns about the appointments process'
The Cabinet Office pointed to comments from Julian Knight, the chair of the Digital, Culture, Media and Sport Committee when confirming Mr Sharp’s appointment, who said MPs had been “impressed” with Sharp's "understanding of how the BBC needs to compete and perform while delivering public service value in a changing media world".
However, Knight also said in the same announcement: “We have previously expressed concerns about the way the appointments process was conducted, particularly in the briefing of preferred names at an early stage. We note that our view is shared by the commissioner for public appointments who recognises the damage done and has called for people briefing on or behalf of ministers to keep their views to themselves.”
The appointment of the BBC chair – a role with responsibility for the corporation's strategic direction and upholding its independence – is made by the monarch on the recommendation of the culture secretary and PM.
Ministers are assisted in the decision by a four-person advisory panel, which shortlists candidates and must run a “fair and open” recruitment process. However, the government has the final say and ministers can choose to re-run contests – and have done so on various occasions.
Sharp, who has previously donated £400,000 to the Conservative Party, did not disclose his involvement in Johnson’s loan arrangement to the appointment panel, BBC or DCMS committee before he was appointed.
The job description for the BBC chair role on the government’s public appointments website says “You cannot be considered for a public appointment if... you fail to declare any conflict of interest.”
It also says: “If there are any issues in your personal or professional history that could, if you were appointed, be misconstrued, cause embarrassment, or cause public confidence in the appointment to be jeopardised, it is important that you bring them to the attention of the Advisory Assessment Panel and provide details of the issue(s) in the statement supporting your application.”
Johnson did not declare Sharp’s involvement to either the register of MP’s interests or the register for ministerial interests.
The MPs’ register says members must declare any financial interest or any benefit which others might reasonably consider could influence their work as an MP.
The ministerial code says: “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.”
Today, Johnson told Sky News the reports were “nonsense” and said Sharp “knows absolutely nothing about my personal finances”.
Johnson resigned as PM and Tory leader in August 2022, under pressure from his own ministers and MPs after a series of scandals, including another payment to help Johnson with his finances.