PM investigated over possible failure to declare wife’s shareholding in childcare firm

Parliament’s standards watchdog has opened an investigation into the prime minister over a possible failure to declare an interest when first asked.

The probe by the standards commissioner, Daniel Greenberg, was launched last Thursday and cited paragraph 6 of the MPs’ code of conduct, which governs how MPs should behave.

The code states that MPs “must always be open and frank in declaring any relevant interest in any proceeding of the House or its committees, and in any communications with ministers, members, public officials or public office holders”.

A Downing Street source said the investigation relates to the shares Rishi Sunak’s wife Akshata Murty holds in a childcare agency that could benefit from a policy announced in the budget.

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A spokesperson for Number 10 said: “We are happy to assist the commissioner to clarify how this has been transparently declared as a ministerial interest.”

Mr Sunak faced accusations of a possible conflict of interest after he failed to mention Ms Murty’s links to Koru Kids, a childcare agency, when he was questioned by MPs over why the announcement in the budget that childminders joining the profession will receive incentive payments favoured private firms.

The i newspaper revealed that Companies House listed her as a shareholder in the organisation as recently as 6 March.

In a letter to parliament’s liaison committee, which quizzed the PM last month, Mr Sunak said he had declared his interests in “the normal way”.

However, in his subsequent letter to the committee, he certified that this was in the ministers’ register, which had not been published at the time he gave evidence to MPs.

While the MPs’ register of interests requires members to declare any payments, donations or hospitality that might be reasonably considered to influence their work in parliament, the MPs’ code of conduct does not require them to record the interests of their spouses or partners.

However, the ministerial register of interests is governed by the ministerial code – which does require the declaration of “interests of the minister’s spouse or partner and close family which might be thought to give rise to a conflict”.

According to the Institute for Government, this distinction makes the ministerial register of interests stricter than that of the MPs’ register of interests.

Any potential punishment is far down the line, but this probe is clearly serious

Rob Powell

Political correspondent

@robpowellnews

The overall aim was to boost the number of childminders able to take up work, which came as part of a broader package about expanding childcare for parents of younger children as well.

The allegation is essentially that when Rishi Sunak was being asked about this, he hadn’t flagged up in that instant that his wife was a shareholder in an agency that would potentially benefit from this policy announcement.

Yes, it was out there in the media, but the rules and code of conduct of parliament is that you have to take formal steps to outline these potential interests so that any potential conflicts of interest between your political day job and personal interests are set out and transparent.

This investigation will go on to see whether the prime minister has declared his interests properly.

The defence from the prime minister is that actually because there’s a register of ministerial interests, where ministers declare potential financial interests or conflicts; because that hasn’t been updated for a year or so now, the new register of ministerial interests will have it detailed there.

The standards adviser investigates and comes back with a decision on whether the code of conduct has been broken.

If it has, that’s where the focus shifts onto what type of punishment should be imposed.

That’s quite far down the line, but it is clearly serious.

But critics, including the Labour chairman of the Standards Committee Chris Bryant, have called for the two registers to be combined because the ministerial register is published far less frequently and so is less visible to the public.

In his letter to the committee, Mr Sunak wrote: “I note that there has been some media coverage relating to the minority stake my wife has in relation to the company Koru Kids.

“I was being asked questions by the committee in my capacity as prime minister.

“I would like to clarify for the parliamentary record that this interest has rightly been declared to the Cabinet Office.”

The prime minister said the most recent list of ministerial interests would be published “shortly” by his independent ethics adviser, Sir Laurie Magnus.

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“This regime ensures that steps are taken to avoid or mitigate any potential conflict of interest, and that the interests of ministers’ spouses or partners are not something that would influence their actions either as ministers or as members of parliament,” he added.

Mr Sunak has previously said that “transparency is really important” for parliament to operate well.

In reaction to Sky News’ Westminster Accounts project launched in January, the prime minister said there was a reason that “rules and regulations” are in place.

“I think transparency is really important for the healthy functioning of democracy, it’s absolutely right that there’s disclosures around donations and outside interests,” he said.

Mr Sunak wrote to the liaison committee to follow up on points that were raised at its session with the prime minister last month.

Labour MP Catherine McKinnell pointed out that six private childcare agencies were set to benefit from Jeremy Hunt’s budget, in which the chancellor announced a pilot of incentive payments of £600 for childminders joining the profession – a sum that doubles to £1,200 if they sign up through an agency.

Ms McKinnell quizzed Mr Sunak on the logic behind making the bonus twice as much for childminders who sign up through private agencies.

His response was that the policy was “designed in consultation with the sector”.

Pressed again on the rationale, he said: “I think it’s a reflection of the fact that they are through intermediaries so there are additional costs.

“And, ultimately, we want to make sure the policy is effective in bringing additional people into the system.”

Asked if he had any interest to declare, Mr Sunak replied: “No, all my disclosures are declared in the normal way.”

The Liberal Democrats previously said that Ms Murty’s shareholding raised “serious questions” for Mr Sunak and called on Sir Laurie to investigate.

In response to the launch of the investigation, Liberal Democrat chief whip Wendy Chamberlain said: “Another day and another accusation of a Conservative prime minister bending the rules.

“This is on the same day that Rishi Sunak may have broken election rules for his government announcement today.

“After months of Conservative sleaze and scandal, the public just want a government which is focused on the country, rather than saving their own skin.”

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Labour’s Deputy Leader Angela Rayner said: “This government’s failure to update the rules or publish a register of ministers’ interests in nearly a year has left a transparency black hole which is enabling the prime minister and those he has appointed to dodge proper scrutiny of their affairs.

“If Rishi Sunak has got nothing to hide, he should commit to publishing the register before May’s elections so the public can see for themselves.

“While this prime minister fails to deliver the integrity he promised and preserves the rotten standards regime he inherited as the Tories resist tighter rules, Labour has a plan to clean up politics with an Independent ethics and integrity commission to restore standards in public life.”

The prime minister is just the latest MP to be investigated by the commissioner, who is looking into the behaviour of six MPs in total.

Last week investigations were opened into three MPs, including former health secretary Matt Hancock, Tory MP Henry Smith and independent MP Scott Benton.