Government rules £100,000 given to Jennifer Arcuri's company 'appropriate'

Image source, BBC World News

A £100,000 grant given to a company owned by a US businesswoman - who is at the centre of conflict of interest claims against the PM - is "appropriate", the government says.

The grant given to Jennifer Arcuri's firm Hacker House was reviewed after the claims were reported last month.

Culture Secretary Nicky Morgan said the review found "no impropriety in the awarding of the grant".

The PM insists he followed proper procedures and did nothing wrong.

Ms Arcuri has said she had never discussed sponsorship or grants with Boris Johnson and he had nothing to do with the awarding of the £100,000 grant from the Department for Digital, Culture, Media and Sport in February this year.

The government review followed a report in the Sunday Times that Ms Arcuri - who knew Mr Johnson when he was London mayor - joined trade missions he led and received thousands of pounds in sponsorship grants.

It said that among cash Ms Arcuri received was a grant from the Department for Digital, Culture, Media and Sport intended for "English-based" businesses.

It was awarded earlier this year, but Ms Arcuri had moved back to the US in June 2018.

The newspaper said it had found the registered address on the grant application form was a rented house in the UK and no longer connected to Ms Arcuri.

The newspaper's report also prompted an investigation by the police watchdog, which is ongoing.

The Independent Office of Police Conduct is deciding whether to investigate the prime minister for a potential criminal offence of misconduct in public office while he was London mayor, between 2008 and 2016, when he also had oversight of the Metropolitan Police.

A separate inquiry by the London Assembly into alleged conflicts of interest has been paused until the watchdog's probe is concluded.

'Due diligence'

The Government Internal Audit Agency review found that Hacker House had not met one of the initial requirements that the amount of funding sought should "not exceed 50% of the lead applicant organisation's annual collective income".

The review also found that criminal record checks had not been carried out.

But because of the low number of applications, these initial requirements were waived.

The review concluded that "the assessment of eligibility and subsequent reduced grant award to Hacker House Ltd was appropriate".

In an accompanying letter to DCMS select committee chairman Damian Collins, Ms Morgan pointed out that the grant decision did not involve ministers, and was made at a time when Mr Johnson was a backbench MP.

"I would like to emphasise again that any notion that the prime minister or his advisers influenced - whether directly or indirectly - any aspect of the due diligence, assessment or award of any grant funding made through the CSIIF (Cyber Skills Immediate Impact Fund) is simply not true," she wrote.

"The grant application in October 2018 and grant decision in February 2019 were, of course, at a time when the current prime minister was neither a member of the government nor the Mayor of London."

On the question of Hacker House's address, Ms Morgan said the company was UK registered, but that this was "not a requirement of the grant".