UPDATE: Following publication of this letter on Sunday 7 January in the FT and Guardian, KPMG have announced they are stepping down as advisors to the Grenfell inquiry with immediate effect! Read updated coverage on the Guardian, FT, BBC.
We the undersigned, call upon the Cabinet Office and Prime Minister Theresa May to reverse the decision to appoint KPMG as advisors to the Grenfell Tower inquiry, without competition.
The failure of KPMG to disclose a clear conflict of interest – that KPMG audit Celotex, the parent company which produced the flammable cladding, alongside its role as auditors of the Royal Borough of Kensington and Chelsea, and Rydon Group, the principal contractor, raises serious questions about the professionalism of KPMG and its ability to define and serve the public interest.
KPMG’s reputation has already been seriously tarnished 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). KPMG failures are also closely associated with the developing Gupta political scandal in South Africa.
The Government’s Grenfell Tower inquiry is already facing criticism from Grenfell survivors and victims for a lack of inclusivity and diversity, failure to consider the deregulatory background via a series of reckless political decisions, made by Government’s of various colours in the decades leading up to the Grenfell disaster.
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.
Big 4 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 like The Royal Borough of Kensington and Chelsea (RBKC) and the Kensington and Chelsea Tenant Management Organisation (KCTMO).
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.
KPMG and other audit firms have directly profited from Government austerity, via the “bonfire of quangos” and related boom in consultancy and outsourcing work, while governance and scrutiny standards in public bodies have fallen.
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?
How does the Government’s covert, fast-track appointment of KPMG as Grenfell advisor chime with public statements about the need to repair trust with the Grenfell Tower Community?
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. [ENDS]
Please note: We do not claim to speak for, or on behalf of Grenfell Tower victims, but are deeply concerned regarding the obvious conflicts of interest posed by KPMG’s involvement with the Grenfell inquiry.