BBC chairman Richard Sharp made “significant errors of judgment” by acting as a go-between for a loan for Boris Johnson, British MPs have said.
Members of a cross-party committee criticised Mr Sharp for failing to declare his role in enabling the arrangement of the loan to MPs when he was applying for the job of BBC chairman.
They said he should “consider the impact his omissions will have” on trust in the broadcaster.
His actions “constitute a breach of the standards expected of individuals” applying for prominent public appointments, said the MPs on the Digital, Culture, Media and Sport Committee.
Mr Johnson allegedly approached Richard Sharp to help arrange a guarantee on a loan of up to £800,000 ($991,000), weeks before the then-prime minister recommended him for the role at the BBC.
Mr Sharp has insisted that he did not arrange the loan but admitted introducing his friend Sam Blyth, a cousin of Mr Johnson who wanted to help the then-prime minister with his financial troubles, to the Cabinet Office.
Mr Sharp was named as the preferred candidate for the BBC job in January 2021 and the Commons Digital, Culture, Media and Sport Committee backed his appointment — but they were not aware of his role in the £800,000 loan guarantee at the time.
In a strongly worded report, MPs have now suggested Mr Sharp's failure to come clean could damage the BBC.
“Richard Sharp's decisions, firstly to become involved in the facilitation of a loan to the then-prime minister while at the same time applying for a job that was in that same person's gift, and then to fail to disclose this material relationship, were significant errors of judgment, which undermine confidence in the public appointments process and could deter qualified individuals from applying for such posts,” the MPs said.
The committee concluded: “Mr Sharp should consider the impact his omissions will have on trust in him, the BBC and the public appointments process.”
The MPs were also critical of Rishi Sunak, who is now Prime Minister, and other senior ministers who had highlighted their 2021 decision to endorse Mr Sharp to defend the appointment since the row over the loan broke, despite the fact they had not been told about the situation.
“The fact that ministers have cited this committee's original report on Mr Sharp's appointment as a defence of the process was followed, when we were not in full possession of all the facts that we should have had before us in order to come to our judgment, is highly unsatisfactory,” the MPs said.
The MPs said there was an “unresolved issue” as to why Cabinet Secretary Simon Case believed Mr Sharp had himself been giving financial advice to Mr Johnson and called on the Cabinet Office to “clear up the confusion”.
“Mr Sharp denied that he had ever given financial advice to the then-prime minister but was unable to account for the decision by the Cabinet Office to issue a note to the prime minister advising him not to seek further financial advice from Mr Sharp given his impending appointment as chair of the BBC,” the MPs said.
Mr Sharp was called back to the committee on February 7 this year following The Sunday Times' revelations about his role in facilitating the loan for Mr Johnson.
He said that Mr Blyth's offer of help for the former prime minister was made in September 2020 and he had stressed the need for things to be done “by the book”.
Following the launch of the recruitment process for the BBC chairman role, Mr Blyth contacted Mr Sharp to request an introduction to the Cabinet Secretary to ensure due process was followed.
Mr Sharp told the MPs that he met Mr Johnson before going to see Mr Case and informed him that he would be telling the Cabinet Secretary about Mr Blyth's offer of financial assistance.
Mr Sharp met Mr Case in December 2020, at which point he “agreed no further participation” in relation to the financial support, in order to avoid any conflict of interest or perception of conflict given his application,” the report said.
Mr Sharp told the MPs that as far he was concerned, that meant “the matter had been resolved”.
In their new report, the MPs said: “Mr Sharp recognised the need to be open and transparent over facilitating an introduction of the then-prime minister to Mr Blyth regarding the £800,000 loan guarantee and brought this to the attention of the Cabinet Secretary.
“However, he failed to apply the same standards of openness and candour in his decision not to divulge this information during the interview process or to this committee during the pre-appointment hearing.”
Acting chairman of the DCMS Committee Damian Green said: “The public appointments process can only work effectively if everyone is open and transparent, yet Richard Sharp chose not to tell either the appointment panel or our committee about his involvement in the facilitation of a loan to Boris Johnson.
“Such a significant error of judgment meant we were not in the full possession of the facts when we were required to rule on his suitability for the role of BBC chair.”
Deputy Liberal Democrat leader Daisy Cooper said Mr Johnson “must now also face the music and answer questions from an independent inquiry”.
Lisa Nandy, Labour's shadow levelling up secretary, said Mr Sharp's relationship with Mr Johnson was looking increasingly “murky” and that the BBC chairman's position had become “untenable”.
In an interview with Sky News on Sunday morning, she said the report by MPs was a “really serious development”.
“The government has relied on the defence that the Culture, Media and Sport Select Committee approved this appointment, but the Culture, Media and Sport Committee today is saying that actually, had they known about this, it would have been a very different situation, this information was not disclosed to them prior to approving that appointment,” she said.
“Increasingly the circumstances around the relationship between the Conservative prime minister Boris Johnson and Richard Sharp is looking more and more murky and I think his position is becoming increasingly untenable as a result.”
Government minister Andrew Mitchell said decisions on the future of Mr Sharp are a matter for the BBC.
Asked whether Mr Sharp's position was untenable, Mr Mitchell said: “We shouldn’t rush to judgment on that we should allow this process to conclude. And then in the end, it will be a matter for the BBC, of which he is the chairman, to make a final decision.”