Seventy-one academics, writers and campaigning organisations, as well as two Labour MPs, Clive Lewis and Emma Dent-Coad, have sent an open letter to the prime minister calling on her to cancel the appointment of auditors KPMG to assist with the Grenfell Tower inquiry.
They said that KPMG has a clear conflict of interest and should not be in this role, and that if the prime minister wants the public inquiry to have the confidence of the local community this is not the way to do it.
They said that KPMG audits Celotex, the parent company that produced the insulation on the building, alongside its role as auditor of the Royal Borough of Kensington and Chelsea (RBKC), and Rydon Group, the contractor that refurbished Grenfell Tower.
The signatories include academics from LSE, Leeds and Lancaster universities, Green party politicians, writers, activists and the singer and actor Lily Allen. They argue that there are serious concerns about KPMG and its ability to define and serve the public interest and that these concerns make KPMG unsuitable to advise the Grenfell inquiry.
KPMG’s reputation has already been affected by the failed HBOS and Cooperative Bank audits in the UK, as well as its flawed auditing of overseas banks including Wachovia, New Century Financial, Wells Fargo, Countrywide and Banca Monte dei Paschi di Siena (for which it has paid out millions of dollars in fines and settlements).
The government’s Grenfell Tower inquiry is already facing criticism from survivors of the fire and other victims for a lack of inclusivity and diversity, and a failure to consider the consequences of decades of deregulation.
The letter stated: “Government must recognise that appointing advisors so closely associated with firms under inquiry can only further fuel rumours of a deliberate cover-up and erode public trust.
“The big four accounting firms actively lobbied the Conservative party in the lead-up to the 2010 general election to close the Audit Commission, which audited and investigated public bodies such as the Royal Borough of Kensington and Chelsea and the Kensington and Chelsea Tenant Management Organisation.”
It added: “The Audit Commission was shut by Government in April 2015, leaving an accountability vacuum in local government audit and fraud investigation, into which cases like Grenfell ultimately fall.
“We question why the Cabinet Office only chose to announce the appointment of KPMG to the controversial Grenfell advisory role in December, when the decision was made in August?
“It is entirely inappropriate to reward RBKC auditors KPMG with Grenfell Tower inquiry work and we urge Government to reverse the decision and to cancel the KPMG contract.
“How does the Government’s covert appointment of KPMG as Grenfell advisor chime with public statements about the need to repair trust with the Grenfell Tower Community?”
A KPMG spokesman told the FT it has “policies and procedures in place to identify and manage any potential conflicts of interest when taking on new work”. “We are satisfied that no conflicts exist in this case, given the nature and scope of our work for each client,” said a spokesperson for the firm.
A spokeswoman for the Grenfell inquiry team said: “KPMG has provided the inquiry with limited planning and programme management support during its start-up phase in order to help the inquiry make rapid progress in its work. KPMG has had no role in the inquiry’s investigations or decision-making processes and its contract contains strict confidentiality clauses to ensure there can be no conflicts of interest. However, the inquiry has asked KPMG to provide further assurance about any relationships with organisations linked to the inquiry’s work.”
Joel Benjamin, a researcher and campaigner at Research for Action, said: “I was shocked to learn KPMG had been appointed by Government, uncontested, to advise the Grenfell inquiry, given known and previously undisclosed conflicts of interest. We do not claim to speak for, or on behalf of Grenfell Tower victims, but are deeply concerned about the obvious conflict posed by KPMG’s involvement with the Grenfell inquiry.”
