UK MPs call for stronger regulation of ‘revolving door’ between government and business

By on 26/04/2017
‘Revolving door’ between public office and business has damaged trust in politics and public institutions.

The UK’s system for regulating the ‘revolving door’ between public office and business is “ineffectual” and its weakness has “damaged” trust in politics and public institutions.

That is the main conclusion of a report published today by MPs from the Public Administration and Constitutional Affairs Committee (PASAC) on the processes in place to scrutinise the transition of former ministers and officials into private sector roles after leaving public service.

The report was critical of the Advisory Committee on Business Appointments (ACOBA), the main regulator for this area, which PASAC describes as “toothless”.

MPs said ACOBA has failed to improve the climate of opinion around business appointments, pointing to various gaps and loopholes in the body’s monitoring processes. ACOBA is tasked with ensuring that public servants don’t trade insider knowledge into jobs with suppliers and lobbyists, and may take actions such as placing time-limited restrictions on former public officials’ new roles. However, the committee has no powers of investigation, and no powers to sanction those who ignore its rulings or fail to seek its approval before moving jobs.

What’s more, the committee says, civil servants at lower levels who have responsibility for commercial management or developing policy are not regulated by ACOBA. Yet they might easily experience conflicts of interest when they move into private sector roles.

The committee calls for “major reform” of the current system, including an “urgent review” of the business appointment rules that govern the take-up of employment by former ministers and officials.

PACAC notes that similar recommendations were made four years ago by its forebear, the Public Accounts Select Committee, but that “nothing has significantly changed”.

“Meanwhile, the problem has escalated, with increased numbers of public servants moving between the public and private sectors, and with declining public confidence in a system that was set up to command trust by mitigating any breaches of the rules,” the committee says.

The committee also calls for the Cabinet Office to aggregate and publish data on applications made by civil servants below a certain grade looking to take up roles in business. Officials below SCS3 grade currently fall outside ACOBA’s remit but are among the group most likely to move into the private sector, the committee says. The collection and publication of information on civil servants from all government departments and agencies looking to move into business would improve transparency and public scrutiny, the committee adds.

Chair of PACAC, the Conservative MP Bernard Jenkin MP, said: “Without greater clarity and understanding of what moral behaviour is expected of public servants, the culture has become established in public life that individuals are entitled to capitalise on their public sector experience when they move into the private sector without clear boundaries. This is the ‘new normal’, and public confidence in the effectiveness of ACOBA’s advice to former ministers and civil servants will continue to diminish further.

“The government must take steps to ensure that the ACOBA system is improved swiftly. In the long term, failure to do so will lead to an even greater decline in public trust in our democracy and our government.”

A spokesperson for the Cabinet Office, which has oversight of transparency and accountability matters across government in the UK, said: “We will consider the committee’s report and respond to its recommendations in due course.”

Some observers have noted that PACAC’s report comes soon after former Tory chancellor George Osborne controversially accepted the job of editor of the London Evening Standard, even whilst retaining his role as an MP and various advisory positions. Osborne received criticism for only notifying ACOBA of his new job a couple of days before his appointment was announced publicly, and before the committee had made any ruling.

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See also:

UN leaders look to private sector for sustainable development goals cash

Report claims US civil servants earn more than private sector

Brexit: UK government should try to win back officials from European Commission by offering ‘more than competitive pay’, committee says

About Ben Willis

Ben Willis is a journalist and editor with a varied background reporting on topics including public policy, the environment, renewable energy and international development. His work has appeared in a variety of national newspapers including the Guardian, Daily Telegraph and Times, as well as numerous specialist business, policy and consumer publications.

One Comment

  1. Jag Patel

    26/04/2017 at

    The ‘revolving door’ is one reason why public trust in Government and Public Sector institutions has fallen to a new low. This is because the twin evils of lobbying and corruption rear their ugly heads every time public money crosses the boundary between the Public Sector and the Private Sector.

    Whereas media focus is more often on the small number of high-profile political elite who shamelessly exploit their previous contacts and know-how they have accumulated whilst in the pay of the State to line their own pockets and unwittingly skew the market in favour of their new paymasters in the Private Sector, the journey made by thousands of ordinary public servants underneath them, who are also looking to follow the example set by their political masters and cash-in on this bonanza, has escaped scrutiny.

    Of course, everyone has a right to sell their labour in the free market to whomsoever they wish, for whatever price they can command. However, the brazen way the newly-retired political elite have gone about exercising this freedom without any checks and controls on the way they go about disseminating privileged information about inner workings of Government is scandalous, and always to the detriment of taxpayers – which is what they promised they would protect whilst in the pay of the State!

    The military-political-industrial complex has been the original model for lobbying and corruption from the earliest of times – indeed, the career prospects of people in the pay of the State are inextricably linked to those with the means to produce weapons systems, facilitated by the ‘revolving door’ and intense lobbying behind the scenes where it matters most, in the corridors of power inhabited by the same, self-serving political elite.

    At a time when the headcount at MoD’s defence equipment acquisition organisation at Abbey Wood, Bristol is being forcibly slashed as part of the 2015 Spending Review settlement with the Treasury, there exists an extremely high risk that departing procurement officials, including those who have not previously taken part in the assessment of invitation to tender responses, will be persuaded to pocket corresponding memory sticks (or CDs) and offer them in return for employment, to competitors of owners of these same CDs – thereby transferring innovative design solutions and Intellectual Property Rights which can then be used by unscrupulous recipients, to grab a larger share of the defence market.

    Such behaviour only reinforces the view that lower-level defence procurement officials have nothing to offer potential employers in the Private Sector (unlike the political elite), except someone else’s property! And when these people arrive on Contractors’ premises, they promptly become a burden on fellow co-workers and the payroll because they do not have the necessary skills (due to being selected for reasons other than merit) as task performers to add value to the business, only costs.

    What’s more, because many Defence Contractors do not have a ‘Code on Ethical Behaviour in Business’ in place, they will not only happily accept such proprietary information without any qualms, but also encourage its unauthorised removal from MoD Abbey Wood – yet they would not want their own CDs to fall into the hands of their Competitors.

    Such is their twisted sense of morality!
    @JagPatel3 on twitter

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