One of David Cameron’s most influential aides was a key adviser on a private equity deal which has left 31,000 vulnerable elderly people facing the prospect of losing their care homes. As co-head of UK investment banking for Morgan Stanley in 2006, Jeremy Heywood, who is now Permanent Secretary in Downing Street, was responsible for the floatation of care provider Southern Cross on the London Stock Exchange.

Heywood, who has also worked for Gordon Brown and Tony Blair, oversaw Morgan Stanley’s role as sponsor, global co-ordinator, book runner and lead manager for the floatation of Southern Cross Healthcare Group. Prospectus documents for shareholders seen by Scrapbook endorse a “sale and leaseback” model which has led ultimately to the company being unable to meet inflated rent bills for 753 properties and the threat of elderly residents being turfed out of their care homes.

David Cameron with Gus O'Donnell and Jeremy Heywood (

Private equity firm Blackstone made £640 million on secret financial deals related to Southern Cross while company executives also trousered millions. As the disaster calls into question the role of capital in the provision of social care, it seems some of the fingerprints on this dodgy financial architecture can also be found in 10 Downing Street.

Did Jeremy Heywood receive a bonus on the deal which has left Britain’s largest care home group teetering on the brink?

  1. Top Cameron Aide… surely it must be another Jeremy Heywood that was PPS to Tony Blair and then headhunted back to Downing Street by Gordon Brown *from* Morgan Stanley…. terribly common name 🙂

  2. What a silly article. First of all Southern Cross obviously wanted to be floated on the stock exchange, otherwise they wouldn’t have asked someone to come in and help them make the necessary arrangements.

    Also, just because Southern Cross decided to float on the LSE doesn’t and didn’t guarantee its bankruptcy. It wasn’t written into the deal that “31,000 pensioners will lose their care by the 31st December 2011”. The terms of the deal would have been signed off by its board. In any case, this is a simple case of a business over-paying for something.

    Thirdly, get your facts right. A private equity deal is not a public stock exchange floatation. The two things are often 180 degrees the opposite of each other.

    Jeremy Heywood is a civil servant. He’s obviously very good at his job to be able to be in the good books of three very different Prime Ministers. So stop making it out like he’s a hand-picked SpAd.

    Perhaps the headline should be “Civil Servant tenuously linked by obscure connection to badly-run business”.

  3. He is not a Cameron aide, he is a Civil Servant. If you don’t understand the difference, why are you commenting on matters relating to British politics?

    This article is so riddled with factual errors, misleading statements and petty gutter politics I’m starting to wonder if Tom Watson and Ed Balls are the real authors…..

  4. PS He was previously at Brown’s Treasury. He left to go and work for the evil private sector (copyright Polly Toynbee) but Brown asked him to come back and impart some of that private equity work ethic to the Civil Service. Shame you didn’t have the space to mention that fact.

  5. He also worked for Ken Clarke and Norman Lamont when he was at the Treasury.

    And it looks like he took the decision not to subject Andy Coulson to DV.

  6. Heywood was PPS to Blair and was one of the people involved in the meetings in the run up to the death of David Kelley. Heywood’s job was to take minutes at 4 meetings between the PM, Tony Blair, and his top advisers in the 48 hrs before Kelly died. Heywood was criticized by the Hutton Inquiry for failing to take minutes at any of these meetings.

    He may also have been involved in the ’45 minute’ claim exaggeration dossier.

    A man who is used to covering up for politicians and I would encourage him to come clean and tell his side of the story (it would rock the establishment) but he’s probably resigned himself to the fact that we live in a corrupt society and he has a very comfortable life. I wish he would tell the truth about the Iraq war …. but Richard Dearlove may spill the beans anyway. It seems an accepted fact that Blair lied and took the UK into an illegal war and now the people of the UK don’t believe politicians after Blair.

    The NHS is safe in my hands – Cameron said -however, the NHS has been opened up to private companies (some of which will not pay tax on profits in UK)

    And they want us to believe that on the one hand they need to spy on everyone because of terrorists but want to support the same terrorists in Syria?

    Heywood could be a brave man and make the world a better place – I wonder if he dare?

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