Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Debate between Andy Sawford and Thomas Docherty

Monday 9th September 2013 Commons Chamber

[Thomas Docherty]

I am most grateful to my hon. Friend, who spoke eloquently from the Front Bench during proceedings on my private Member’s Bill last year, setting out why the Opposition want to see workable legislation. I am more than happy to set out what is wrong with the impact assessment. It uses the Government’s figures and is confused. It says that the register, which covers only consultant lobbyists, will cost £500,000 to set up and a further £200,000 to run each year. That is according to the Government’s own figures, so it must be right. Almost all the firms who are members of the APPC are SMEs. I would be amazed if there were one that employed more than 250 people in total. Most are firms with between 20 and 50 employees, so these are not large firms. They are the entrepreneurial firms that we hear so much about from Government Members. But the Government and their civil servants have made up some rash figures. They have said that there are about 1,100 lobbying consultants in this country. I am still not clear where that figure has come from. I think they have taken the APPC list and accepted that that is probably pretty much every one who is “a lobbyist”. They have then said that, if the cost is £500,000, that can be shared by 1,000, which I assume is the 1,000 lobbyists. However, the Bill contradicts that. It says that payment is per firm—the Deputy Leader of the House graciously nods in agreement—and probably only 10 to 20 firms will be caught by the current definition. I am not a great mathematician, but if one takes £500,000 and divides it by 20, that is not £500. It is significantly more. That is just the start-up cost in the first year. That is a disproportionate and huge impact on small businesses.

[Andy Sawford]

I am trying to make some sense of a pretty nonsensical set of proposals. On my hon. Friend’s point about how the costs would stack up, there are some public affairs companies that are global, such as Edelman and Weber Shandwick. Does he have a view on whether there should be some variation in how the costs are apportioned to the small—perhaps one-person band—lobby company relative to some of these very large companies?

[Thomas Docherty]

I will just touch on the issue of some of the very large firms. One of the huge flaws is the issue of non-lobbying business—that a firm that is not a lobbying company would not be captured. One example is DLA Piper, a well-regarded law firm and lobbying communication consultancy; it is exactly the type of company that could probably afford to pay something. We are talking about £25,000 per company as the cost of the register, which is not the £500 that the Government’s impact assessment claims. DLA Piper is exempt. The irony about the Front-Bench team that we have today is that the reason why the Deputy Prime Minister’s fingerprints are not on the Bill is that his wife previously worked for DLA Piper. The Deputy Prime Minister, correctly in my view, recused himself from the whole process. Under the Bill as it has been drawn up, however, DLA Piper is not covered. I hope that the Minister for the Cabinet Office is reflecting on that irony.

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[Thomas Docherty]

With your indulgence, Sir Roger, let me try to answer what I think is a genuine intervention from the Deputy Leader of the House. I was involved in the APPC back in 2008-09, when the previous Government effectively told the industry that it was drinking in the last chance saloon. In the previous Parliament, we had the Public Administration Committee report that, as I recall, recommended a statutory register if the industry did not improve public confidence and Parliament’s confidence in it. I made the point that those firms that are working in the correct manner and striving to improve their reputation would join a voluntary body, which they duly did, and the UK Public Affairs Council was set up to try to bring those things together. Regrettably, it was clear that the small number of dubious lobbying firms—dubious individuals, to be more accurate—would choose not to. Many of those who sign up to the voluntary register do so because they want to demonstrate that they are playing to the highest ethical standards and that there is bureaucracy and paperwork involved. It is not a case of chaps sitting around and signing off each other’s practices.

Firms also made the point that, when asked by potential clients whether they are a member of a register, they would simply say, “Well, we don’t do that activity.” In my three years as a consultant lobbyist—I understand that the Government do not accept my definition of a lobbyist—I do not recall once having a meeting with a permanent secretary or Minister, so my firm would have had no need to register. That is why I think that there is a real danger that those firms would say, “We don’t undertake that activity, so the Government and Parliament do not think we need to register,” and therefore the provisions will fall away.

[Andy Sawford]

I am trying to understand the intention of the Bill as well as its effect. My understanding of the companies that currently participate in the voluntary register is that effectively they are the good guys, although I am sure that we could find examples of where they have not always met the highest standards. What we should really be trying to do, with regard to bringing transparency, is identifying people currently operating outside any ability for us to see what their line of work is or their willingness to be transparent and bring them into some sphere of registration.

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[Thomas Docherty]

I am most grateful to be admonished for staying in order.

The hon. Lady makes a serious point. We have only four and a half or five hours to consider a huge piece of legislation. Frankly, this should have been scrutinised much better. I fail to see what constitutional imperative has brought it to the Floor of the House. I hope that the other place will do a genuine job of forcing the Government to come back and make some proper amendments, because I think that there are some real issues.

These are not issues that just I have concerns about. We have had the most bizarre and unlikely coalition. The Alliance for Lobbying Transparency has said of the Bill:

“It only applies to consultant lobbyists whose business is mainly lobbying. It would exclude those for whom lobbying is only a small part of the business. This could apply to a large number of significant lobbyists-for-hire”.

At the other end of the debate, the Public Relations Consultants Association polled its own members and found that only 1% of activity was covered from under 20% of the organisation’s concern. Even the hon. Member for Christchurch (Mr Chope), who I see in his place paying close attention, has said:

“The Bill tries to exclude people whose main business is not lobbying, but it does not define what constitutes a mainly non-lobbying business.”

The hon. Member for Clacton (Mr Carswell) has also criticised the loophole, saying:

“I suspect all that this new rule will do is ensure that in some instances big corporate interests will bring their lobbying activity back ‘in house’. Instead of hiring a public affairs consultancy, the big defence, banking and energy interests will give the work to their public affairs department. And because their main business is defence, or banking, or energy, they can safely ignore those provisions of the Bill.”

It is a dreadful state of affairs when two Government Back Benchers—I use the word “Government” slightly loosely, perhaps—are criticising the Bill. I hope the Minister will take on board the genuine concerns that have been expressed.

We have been told that the intention is not to exclude people. To pick up the point made by my hon. Friend the Member for Corby (Andy Sawford), let me give one example of a significant public affairs consultancy—MHP Communications. I should declare that I have met MHP Communications representatives, who have seen me about developments in my constituency. They conducted themselves appropriately at all times.

[Andy Sawford]

My hon. Friend illustrates the complexity of the industry well. MHP Communications derived originally from AS Biss, which was a public affairs-focused agency. It merged with a media company to become Mandate—I am not sure what the balance of that new company would have been—and has now become MHP. It has taken lots of different forms.

We refer to the different registers; the PRCA code, the Chartered Institute of Public Relations government affairs group’s code and the Association of Professional Political Consultants code relate to different kinds of companies. That is why catching APPC members, of whom we are all very aware and whose business is on the web for us to see, does not get us far at all in terms of transparency.

[Thomas Docherty]

My hon. Friend is absolutely right. That is the heart of the problem. Let me quote what MHP itself has said:

“do we work for a ‘non-lobbying business’? In our case, MHP Communications is a full service communications consultancy. We operate a single bottom line approach, and so do not break out the work of our public affairs division. Employees are employees; there is no ‘MHP Public Affairs Ltd’. And the work of MHP is certainly not mainly concerned with lobbying. Even if we were to limit ourselves to our public affairs team, the definition talks about actively lobbying, in the sense of seeking to persuade…members of the Government as well as officials—and this is not ‘mainly’ what we do all day.”

That is the problem with the clause and the Government’s attempt to fix it. It all gets circular—even if we accept that MHP is a lobbying entity, lobbying is defined purely as communicating with a Minister of the Crown and a permanent secretary.

Let us take special advisers, who are not covered at all; we all know that they often have more influence than the Under-Secretary of State. Under the Government’s plan, the lobbyist will be perfectly entitled to have lengthy and detailed influential discussions with a special adviser, and that would not be covered by the Bill. However, the lobbyist could meet the Under-Secretary of State and that meeting would be. Which meeting would be the real problem? One needs look only at the debacle of News International and Fred Michel to see the kind of scandal that can happen.