UK’s revolving door rules not applied properly, watchdog says

By on 11/08/2017 | Updated on 24/09/2020
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British government departments are failing to apply rules that are designed to prevent corruption when civil servants move to the private sector, the public spending watchdog has found.

A study by the National Audit Office found a catalogue of inconsistencies, omissions and errors in the way departments have applied the business appointment rules, and a failure on the part of the Cabinet Office to provide guidance and monitor compliance.

The Cabinet Office withdrew its guidelines on how the rules should be administered five years ago in order to revise them but has yet to publish any updated guidance, according to the NAO report, published last month

Senior officials who leave the civil service are required to get clearance before taking up a new job, if they have had direct dealings with the new employer, were involved in policy areas affecting the firm, or had access to privileged information over the past two years.

Officials have to submit an application to their department, which may impose conditions for approving the appointment. The department has to inform the prospective employer of any conditions and publish its decisions on business appointment applications under the rules.

Since February 2016, government departments have published details of 170 decisions relating to business appointments, of which 138 had one or more conditions attached, with 95% including a lobbying ban and half a confidentiality clause, the report states.

But three departments did not publish any information, while just one – the Department for Communities and Local Government – published a nil return, indicating that it had not made any decisions about business appointments.

Unclear data

“It is not possible to know from the transparency data whether all those leaving the civil service who should have made an application under the rules did so,” the report states. “The Cabinet Office does not consider it necessary to publish nil returns, so it is not clear whether the publicly available transparency data are complete.”

The business appointment rules are designed to prevent abuse of office, profiteering, undue influence and commercial exploitation of privileged information when civil servants take jobs in the private sector.

But the auditors note that the rules do not explicitly state that departments can reject officials’ applications to take up a business appointment, and point to a lack of clarity and transparency within government over the issue.

“No department in our sample reported that it had rejected an application,” the report states. “The Cabinet Office believes that departments do, however, reject applications – although it was not able to evidence this, nor that a system to record this information exists.”

The National Audit Office has found that only one government department is properly applying business appointment rules in the ‘revolving door’ of the Public and Private Sector.

Failure to enforce rules

The NAO looked in detail at how the rules are applied across eight government departments in relation to directors, deputy directors and special advisers at levels one and two as well as those in lower ranks who leave the service for private sector jobs.

Only one department has consistently informed prospective employers of conditions attached to a business appointment approval, the report states. Of 187 appointments that have been approved with conditions attached over the past five years by the other seven departments, the employer was informed in only six cases.

Four departments have approved business appointment applications that were made retrospectively, which the rules declare will not normally be accepted. One of these stated that it processed “a great deal” of retrospective applications, the report states.

Only one department was found to have a policy or procedure for dealing with non-compliance with the rules, while none had procedures for ensuring that former civil servants obeyed with the rules after they left, the auditors found.

One department asked its staff to raise the alarm if they became aware that former employees had not complied with conditions, “in part as they do not have the resources to police whether conditions they set are being complied with”, the report states.

For senior civil servants at levels one and two, the rules are binding for two years after leaving, while those in lower ranks face a one-year limitation period.

Lack of public confidence

The study follows a report published in April by the parliamentary Public Administration and Constitutional Affairs Committee which found that regulation of business appointments among former ministers, permanent secretaries and director generals was ineffectual and does not inspire public confidence.

Shadow cabinet office minister Jon Trickett said the auditors’ investigation showed that the system for monitoring the careers of senior civil servants was broken, according to the Guardian newspaper.

“[The] report shows that there is a complete lack of oversight and a toothless system. It’s a scandal waiting to happen,” he said.

A Cabinet Office spokesperson said it would “carefully consider the full report and its findings”, according to the Public Finance website. “As the NAO has acknowledged, this is an issue that government takes extremely seriously,” the spokesperson said.

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See also:

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

China shuts the ‘revolving door’

UN leaders look to private sector for sustainable development goals cash

About Liz Heron

Liz Heron is a journalist based in London. She worked on daily newspapers for more than 16 years as an education correspondent, section editor and general news reporter. She was Education Editor of the South China Morning Post in Hong Kong and has contributed to a wide range of British media including The Independent, The Guardian and the BBC.

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