A UK government official agreed to join KPMG as a highly paid partner shortly before he took control of a crucial coronavirus project that had awarded consulting contracts to the Big Four accounting firm worth £1.5m, the Financial Times has learnt.
In late March, Chris Townsend was approached by the UK ministry for housing to lead the UK’s shielding programme — a cross-government project to deliver food and medicine for more than 1m clinically vulnerable people who were told not to leave their homes during the pandemic.
Mr Townsend agreed to become chief executive of the project — a voluntary position — despite having accepted a job offer from KPMG two months earlier. He is a high-profile individual in both private and public sector circles, having previously overseen the government’s £1bn internet broadband rollout, worked as commercial director of Chelsea Football Club and led fundraising for the 2012 Olympic Games in London for which he was awarded an OBE.
At the same time as Mr Townsend was approached to take over the UK shielding programme, the project handed at least three contracts to KPMG worth about £1.5m. KPMG was given a lead contractor role to help set up and run the project without a competitive tender process.
The ministry of housing, communities and local government, which is led by secretary of state Robert Jenrick and which set up the shielding programme, said: “The decision to procure KPMG services was taken before Chris Townsend joined the department. A formal process was undertaken with relevant approvals received from MHCLG officials in line with procurement rules and guidance.”
The contracts showed KPMG was awarded the work between March 26 and April 6, by which time Mr Townsend had already been provisionally hired by KPMG and was in discussions to take over the programme. His appointment as head of the shielding programme was announced on April 14.
In March, the UK abandoned its usual procurement rules, which require all contracts of more than £10,000 to be openly advertised and tendered, to enable departments to move quickly when responding to the pandemic. However, many such directly awarded contracts have been criticised over whether they provide value for money, offer poor services or raise apparent conflicts of interest.
KPMG delayed Mr Townsend’s official appointment at the Big Four firm because of the optics of the move, according to two people close to the decision. One insider said: “There were meetings to discuss how the timing of hiring him would look. The timeline doesn’t look great.”
He formally became a partner at KPMG last month and its head of infrastructure, government and healthcare, where he will help lead the firm’s work for the government on the Covid-19 crisis. Partners at KPMG earned £549,000 each on average in 2019.
KPMG is one of a number of large advisory firms that were awarded consulting contracts worth a combined £100m by the UK government in the first months of the pandemic.
KPMG said: “Following the onset of the Covid-19 pandemic, Chris Townsend was approached about the shielding programme short-term role after he’d agreed to join KPMG. This appointment was subject to strict safeguards being put in place. He was not involved in the awarding of any KPMG contracts and this was a specific term of his engagement with the programme.”
Mr Townsend declined to comment.