Advisory Committee on Business Appointments

Kelvin Hopkins Excerpts

Thursday 28th June 2018 Commons Chamber

[Kelvin Hopkins (Luton North) (Ind)]

I am pleased to support the report. I commend the Chairman for his excellent speech. I have for a long time been concerned about public confidence in politicians and the state of Government, and it is very important indeed that we get it across that we are, overwhelmingly, honest people, trying to do the right thing by our constituents and by the country to improve everyone’s lives. But there are those who are not.

I am taken back to when I was first elected as a councillor, many years ago—1972 to be precise—and I was challenged outside a public meeting in my ward by a scrap metal merchant. He said, “Look mate, we are all on the fiddle, aren’t we?” I said, “No, actually; I am not on the fiddle.” He said, “No, not you—them others.” I said, “Which others? If you give me their names I shall report them to the chief executive.” He said, “No, not the councillors—the officers.” I said, “That is even worse. If you know names of officers who are ‘on the fiddle’ as you put it, I shall certainly report them to the chief executive.” He walked away in disbelief; he thought I was going to say, “Of course I am on the fiddle, mate. Have you got any backhanders for me?” That is not how things work, but some people suspect that that is how it works.

More recently, a couple of years ago, there were some television stings on Members. One was absolutely astonishing. One Member openly said, “Yes, I am for hire, like a taxi.” Another said they would be prepared to work for, I think, £5,000 a day. It was astonishing—Members whom I knew. I had no idea that was how they thought.

We are well paid and have good pensions. I believe that our job is to represent the interests of ordinary people, not ourselves, or indeed the interests of business. ACOBA, as the Chairman rightly said, is toothless and feeble. I am a member of the Public Administration Committee. There are those on the Committee who fulminate, almost, at what has been going on. I feel just as strongly. The report moves us forward and the Government must act at some point. I personally believe that the rules should be much stronger and rigorously enforced to ensure that everyone believes that our politics are honest and straight.

--- Later in debate ---

[Christian Matheson]

I am most grateful for that clarification and the House will have noted it.

The Advisory Committee on Business Appointments is entirely necessary, but, to use the phrase of the moment, not at all fit for purpose. The clue is in the name. The A in ACoBA stands for “advisory” and it is clear that the committee is just that: it has no teeth and if its harshest sanction is to embarrass—well, that is scarcely a sanction at all. I wonder whether, as currently constituted, it is even designed to make a difference with a very narrow remit. As far as I can tell, ACoBA has never actually refused an appointment.

ACoBA is appointed by the Government to provide independent advice to senior Crown servants and to all former Ministers of the UK, Scottish and Welsh Governments on any appointments they wish to take up within two years of leaving public or ministerial office. ACoBA applies the business appointment rules, which are largely procedural and set by the Government. They have no statutory basis and there are no sanctions for non-compliance. The rules apply for up to two years after leaving office and they are applied with inconsistency.

It is a clear failure of ACOBA that it cannot adequately distinguish between different types of post-ministerial appointment, for example paid as opposed to unpaid work. One former senior civil servant recounted to me the story of when they left the civil service. They took a position on the board of trustees of a community group. It took months upon months for this voluntary position to be approved. Part of the delay was down to due diligence, because the trust was a charity. If charities and the Charity Commission can undertake due diligence and prevent an appointment pending such checks, why can ACOBA not do that?

Meanwhile, as we have heard, the former Chancellor George Osborne can take a job with BlackRock in the City of London and not even tell ACOBA that he was taking a job editing the London Evening Standard. I understand the same applies to the former head of GCHQ, Robert Hannigan, who was appointed to the European advisory board for a new US cyber-security firm, BlueteamGlobal, and did not even tell ACOBA. Because it is set up as an advisory and non-statutory committee, ACOBA finds enforcement difficult. I suspect that this is the reason it does not attempt to enforce. Indeed, it may be the reason it was set up in this way in the first place.

In addition to ACOBA’s toothlessness, there are further problems, for example with conflicts of interest. There are numerous, multiple examples of members of the committee declaring interests in firms to which the applicants were being appointed, but not recusing themselves from those cases. This included Mary Jo Jacobi, who has financial interests in BP but did not recuse herself from Vernon Gibson’s application, and John Wood, who has interests in BT, did not recuse himself from Keith Bristow’s commission with them.

ACOBA was also criticised by the former Public Administration Committee for having an “establishment” make-up—the hon. Member for Harwich and North Essex raised this point. ACOBA is chaired by a Baroness and former Conservative Minister, who also works as a consultant for a company that looks very much like a lobbying firm. Other members of the committee include two Lords, a knight, a former general secretary of the First Division Association, lawyers and former senior civil service grandees. I go back to the evidence cited by the Chair of the Public Administration and Constitutional Affairs Committee about bus drivers or hairdressers. As he says, there seems to be no sight of them.

[Kelvin Hopkins]

My hon. Friend is making the point made by the Chair and other colleagues. Putting people on ACOBA who look like members of the establishment, honest though they may be, just reinforces the image among the public of the establishment looking after itself, instead of having ordinary people, maybe bus drivers and hairdressers, who are remote from the establishment on the committee.

[Christian Matheson]

I thank my hon. Friend for that point, but it is not simply about image. It is about having a different perspective. It is about approaching the question of an appointment from a different point of view, so that somebody from the outside, a bus driver or a hairdresser, can say, “Look, this really doesn’t look right from where I am sitting.” He makes an extremely good point, but the issue is about more than how it looks.

We welcome much of the report, including its finding that the problem of conflicts of interest

“has escalated, with increased numbers of public servants moving between the public and private sectors, and a number of very high profile cases resulting in declining public confidence in a system that was set up to command trust by mitigating any breaches of the Rules.”

It also states:

“The regulatory system for scrutinising the post public employment of former Ministers and civil servants is ineffectual and does not inspire public confidence or respect.”

It refers to

“numerous gaps in ACoBA’s monitoring process with insufficient attention paid to the principles that should govern business appointments.”

The report has several clear and pretty strong recommendations for ACOBA, including much greater transparency of data published about decisions, an amendment to the Ministerial Code, and the publication of applications on receipt and not after the fact. It also proposes the disclosure of full information about ACOBA‘s procedures for assessing applications and the reasons for its judgments.

Labour Members welcome the report as a starting point for the reform of ACOBA, but I disagree with the hon. Member for Harwich and North Essex, who said—although I may have misunderstood him—that reform might be quite difficult. I am not sure that it would be if enough attention were given to it, and as long as the political will was there, although I concede that he, rather than me, is the one who has done all the studying of the detail.

We have been calling for the reform of ACOBA since 2011. Whether the issue is the lack of diversity of its members, their own conflicts of interest, or indeed the very rules by which they work—or, indeed, do not work—it cannot continue to exist as a fig leaf that fails even in that role of concealing the revolving door. It should be entirely reconstituted, with clearer terms of reference and stronger powers to delay or block appointments that are not appropriate. By failing to act, or being unable to act, ACOBA highlights the fact that the current arrangements are simply not working, and it must be reformed.

[The Parliamentary Secretary, Cabinet Office (Chloe Smith)]

I thank all the Members who have spoken today. I am, obviously, particularly grateful to my hon. Friend the Member for Harwich and North Essex (Sir Bernard Jenkin), and, through him, I thank his Committee for its examination of this issue over time. Obviously, the Government welcome the opportunity to respond formally to its most recent report on this subject. That report stands. I trust that Members have had a chance to read it in detail today. I have also been able to listen to the points that have been made during the debate. Let me now set out how the Government see ACoBA, and, in doing so, try to address some of those points.

ACoBA fulfils a specific remit: to supply independent, impartial advice on the business appointment rules to former Ministers and civil servants on proposed new appointments of people who have left Government service. It supplies its advice directly to former Ministers and, in the case of civil servants, to either the Prime Minister or the relevant permanent secretary. It remains the Government’s view that it fulfils its remit effectively, efficiently and with professionalism. It comprises nine very knowledgeable individuals, independent of Government, who bring with them a wealth of experience from the public, private and third sectors.

The business appointment rules system itself is a set of principles which seeks to ensure that, when a former Minister or civil servant takes up an outside appointment, there is no justified public concern about that appointment. We do think, though, that people have a right to earn a living after leaving Government, perhaps in areas in which they have established expertise. When applying the rules, the system should strike a balance, ensuring that there is public confidence, but also ensuring that the conditions do not amount to an unlawful or unenforceable restraint of trade.

[Kelvin Hopkins]

It is fair enough that, when people leave the House, or leave Government jobs, they should be able to earn a living, but not necessarily in the area in which they previously worked, from which they could benefit through their inside knowledge, or in which they might even have influenced policy in the expectation of a subsequent reward. That is what is wrong. If someone who was in the MOD then gets a job as a schoolteacher, that is not a problem; if they get a job ordering supplies for the military, that is a different matter.

[Chloe Smith]

I think that the hon. Gentleman and I are in agreement, because that is the guiding principle of this structure. There should be able to be public confidence that abuses are not occurring. There was a clue, I think, in his choice of words. He may have involuntarily used the words “not necessarily”, but there is something rather important in that. We have a flexible system that means that there is the ability to make a decision not necessarily in one fashion or another. That is one of the advantages of having a non-statutory body —it can be a little more flexible, in a way that is different from something that is encased in legislation, where the words “necessarily this” or “necessarily that” may apply.

[Kelvin Hopkins]

I hope that the hon. Lady is not reading too much into my words. In my short speech, I said that I wanted strong rules, rigidly enforced. That is the way it should be. There should be an entire separation between what a Minister does in government and what they do after they leave Parliament.

[Chloe Smith]

I hear and respect the hon. Gentleman’s view and I am grateful to him for taking the trouble to repeat it.

One of the other principles at stake is that we do not want to deter talented people from entering government service. I suspect that the Committee also recognised that principle, quite rightly. In the Government’s view, that could result from having an over-rigid system that could prevent or restrict people from returning to the sectors in which their expertise lies appropriately following a period of public service. Now, more than ever, with some major challenges in view for the public sector and for the civil service, we need to be able to attract the best skills and talent and to benefit from those who have capabilities and experience from outside the civil service—let us not forget this argument works two ways.

In order to deliver for the public and for taxpayers in the way in which they expect of their civil service, we need to be able to maintain a confident, professional and expert service when we are looking at such important and critical matters in the public sector.