The public should be given a “full and frank” explanation as to how a top civil servant was allowed to work as a part-time adviser at Greensill Capital while still in Whitehall, according to Lord Pickles.

The chairman of the committee which vets the appointment of senior ministers and officials told MPs the Bill Crothers case highlighted “a number of anomalies within the system”, and that his was not an “isolated” situation.

Mr Crothers, a former head of Government procurement, began working for collapsed firm Greensill as a part-time adviser to the board in September 2015 – in a move approved by the Cabinet Office – and did not leave his Civil Service role until November that year.

Advisory Committee on Business Appointments (Acoba) chairman Lord Pickles said the public is “entitled” to know the arrangements for second roles being approved by the Cabinet Office, such as in Mr Crothers’ example.

“I mean, if Mr Crothers had decided he wanted to have a milk round or something, I don’t think we would be terribly worried,” he told the Commons Public Administration and Constitutional Affairs Committee (PACAC).

“But his particular position, in terms of running procurement and working for a commercial organisation, is something that does require a full and frank and transparent explanation.”

Lord Pickles said he did not take his concerns about the lack of transparency in such appointments to the Prime Minister due to the Government dealing with the coronavirus pandemic, and also the fact he felt his push for reforms was being met.

The former cabinet minister added: “If I had found the machine wasn’t responsive, then I would have wandered down and spoken to a Secretary of State or the Prime Minister.”

During the hearing with Lord Pickles, PACAC chairman William Wragg announced a “full inquiry into the topical matters around Greensill”, which was approved to administer Government Covid support loans before it went bust.

MPs on the Commons Treasury Committee had already announced their own inquiry into the firm’s collapse, which threatens thousands of UK jobs at Liberty Steel, which relied on the group’s financial backing.

Meanwhile, the Commons Public Accounts Committee said it intends to investigate the broader issue of supply chain financing – which Greensill was involved in – and to call David Cameron to give evidence.

Lord Pickles – who denied Acoba acted as a “watchdog” on appointments – said it is “not unusual” for civil servants to have paid second jobs, but not at Mr Crothers’ level, and admitted to being “surprised” by the official’s “excuse” in justifying his former part-time role with the specialist bank.

He recommended that all consultants and contractors for the Government should sign a publicly-available memorandum of understanding where the restrictions on their future employment is set out.

Prime Minister Boris Johnson acknowledged on Wednesday that the boundaries between civil servants and the private sector had not always been “properly understood”.

In response, Cabinet Secretary Simon Case has called on all Whitehall departments to notify him of any senior officials with paid jobs outside Government by the end of the week.

In a letter to permanent secretaries, he said the disclosures were a cause of “acute concern”, and he stressed the need for the Civil Service to “engage fully” with the review commissioned by Mr Johnson and led by senior lawyer Nigel Boardman.

David Cameron's lobbying on behalf of Greensill Capital has come under scrutiny
David Cameron’s lobbying on behalf of Greensill Capital has come under scrutiny (Jacob King/PA)

Sir David Normington, a former Home Office permanent secretary, said it was “absolutely baffling” to learn of the situation surrounding Mr Crothers’ career switch, telling the BBC he had “never come across anything like it in my over 40 years in Whitehall”.

He said it is “essential” for Acoba to sign off on new moves as he pushed for greater oversight on top officials when exiting Whitehall.

The evidence from Lord Pickles, a former Tory Party chairman, follows a recent furore over lobbying by Mr Cameron on behalf of Greensill.

It followed disclosures that the former prime minister personally lobbied Chancellor Rishi Sunak on its behalf and was able to arrange for its founder, Lex Greensill, to have a “private drink” with Health Secretary Matt Hancock.

The Government used its Commons majority this week to defeat an attempt by Labour to force the creation of a new committee of MPs specifically to examine the issues of lobbying and the Greensill affair.

Labour leader Sir Keir Starmer said it was “wrong” of the Government to vote the proposal down and that the current lobbying rules “obviously aren’t working”.

“Increasingly we’re seeing a murkier and murkier picture, whether it’s the way contracts are handed out, the lack of due process, or the lobbying, which is not a revolving door but now an open door into Government,” he told reporters during a campaign visit to south Wales.

Mr Cameron has insisted he did not break any rules, but acknowledged there are “lessons to be learned”, and that as a former prime minister, any contacts with Government should be through the “most formal channels”.

A spokesman for Mr Cameron has said he would respond “positively” to any request to give evidence to any of the inquiries that are taking place once the terms of reference have been established.

Meanwhile, Lord Pickles, when giving evidence to MPs, defended the appointment of the head of a lobbying firm to sit on Acoba, citing Andrew Cumpsty’s nomination as a ministerial decision that he supported.

“I think it was sensible to get someone with experience. He has proved very useful on these issues,” the peer added.