Government and Institutions

Lobbying in politics: a perennial issue?

In 2010, the new Prime Minister David Cameron, long before his own ill-judged engagement with Greensill Capital, warned that lobbying was “the next big scandal waiting to happen”. The focus of his concern, after a decade of minor scandals mostly involving Labour Ministers, were the lobbyists themselves and their access to Ministers. The reforms that followed then focused primarily on transparency for both, including publishing such meetings and creating a register of lobbyists. This, with a few tweaks, is the system we have, and calls for reform of it have typically focused on expanding the scope and bureaucracy of transparency. It has rarely focused on the central issue in any lobbying scandal, which is politicians making a bad decision. We wrote about this in 2019, noting that very few such scandals “actually involve paid lobbyists”. We suggested transparency should focus on politicians themselves, publishing their non-sensitive meetings, not ever larger rulebooks, box-ticking, and databases for everyone else.

MPs set their own rules, as do the House of Lords. MPs have had to register their outside interests since 1974 and significantly boosted their scrutiny of abuse after 1994 and the ‘cash for questions’ scandal. This was where some MPs took literal brown envelops of cash in exchange for asking questions in Parliament. It was a part of the narrative of ‘sleaze’ that ended 18 years of Conservative Government in 1997 with a landslide win for Labour. Lobbying by MPs then is already clearly against their code of conduct and has been for years:

“No Member shall act as a paid advocate in any proceeding of the House…taking payment in return for advocating a particular matter in the House is strictly forbidden”.

This tallies with the Prime Minister’s recommendation:

“MPs should not accept any paid work to provide services as a Parliamentary strategist, adviser or consultant, for example, advising on Parliamentary affairs or on how to influence Parliament and its members. MPs should never accept any payment or offers of employment to act as political or Parliamentary consultants or advisers.”

In substance, this adds nothing, but it creates the perception that such clarity is required to address issues arising from the recent row about former MP Owen Paterson. Paterson’s defence, that he was acting exceptionally in the public interest and subject to an unfair process, was novel, and rejected by the competent authority, the Commissioner for Parliamentary Standards. The Government’s decision to temporarily agree with Paterson looked political, with many Conservatives, including the PM, feeling the Commissioner was biased against them. But it was not well grounded in either the spirit or letter of the rules. Some valid points were raised about the Standards process, MPs should have a right of appeal, but paid lobbying is lobbying, and acting in the public interest for no reward beyond your MP’s salary is the job. That Paterson has resigned however renders the substance of the complaint, for him at least, moot.

Parliament conversely is left needing to remind people that these rules exist. This has less to do with one former MP than it does with the pandemic. Several politicians seem to have treated the pandemic as a carte blanche exemption to the Nolan standards in public life that followed cash for questions. Again, no doubt ‘in the public interest’, several appear to have engaged in helping friends and interests to which they are personally connected to secure Government contracts linked to pandemic services. Standard rules of public procurement were necessarily streamlined to ‘save the NHS’, but not suspended entirely. MPs and peers were still expected to behave with selflessness, integrity, objectivity, accountability, openness, honesty, and leadership on the behaviour of others.

It seems unlikely that the public perception of Parliament this month aligns with those ambitions. The ‘war powers’ defence, that the only thing that matters in a crisis is solving the crisis, does not survive modern expectations that even to win a war we generally expect people not to commit war crimes, let alone personally profit from them. If you do, then expect to reap the consequences, which in respect of MP’s paid lobbying means the possibility of recall and losing your seat.

Labour’s proposed solution, which is to ban all second jobs (bar a few exceptions), looks equally political, targeting a perception of their opponent’s greed rather than upholding standards in public life. If it is OK for an MP to be a doctor one day a week, it is OK to do a range of other occupations that are not lobbying, for example writing newspaper columns, providing legal advice or being a football referee. It is for the voters to decide whether those decisions are wise, rather than a matter of restrictions. It would not be possible to sensibly define every job that might create the perception of a conflict of interest, so it is better to focus on the substance of lobbying activity, rather than their category.

The underlying issue however remains the lapse in standards following an extraordinary event, not the rules. With the pandemic now largely over, this should not persist, the UK is not a country that experiences high levels of political corruption. But for those involved in poor decisions, the political damage may already have been done.


Andy Mayer is Chief Operating Officer, Company Secretary and Energy Analyst at the IEA. Andy is responsible for developing our people, all operations, and managing the reputation of the IEA, including for example over-turning the Charity Commission’s unlawful attempt to ban one of the IEA’s publications, and dealing with failed attempt to smear the organisation by activists at the same time. When not leading operations, Andy writes and comments on free market issues around energy and climate change, and occasionally general commentary. He was previously the Head of UK public affairs for the world’s largest chemical company and green energy advisor to the UK’s largest company. He has over 25 years of experience in strategic communications and the operations that support them in the business and think tank worlds.

1 thought on “Lobbying in politics: a perennial issue?”

  1. Posted 20/11/2021 at 08:00 | Permalink

    The corporate lobbying scandal involving a former Prime Minister has exposed the nexus between the political elite and the business elite that contrives to put the interests of big business first, ahead of the wants, needs and expectations of ordinary citizens, not least, because the twin evils of lobbying and corruption rear their ugly heads every time taxpayers’ money crosses the boundary between the public sector and the private sector.

    In this latest exposé of influence peddling in Whitehall, the press and media have painted a picture which gives the impression that only a handful of people are involved in these nefarious activities. The reason is simple – journalists are obsessed by human interest stories and consequently, they have developed a habit of focusing only on people and personalities right at the top.

    But the fact of the matter is that lobbying and corruption is widespread throughout the public sector (and by extension the private sector), at every level of the hierarchy, but no one has bothered to publicise this reality for the benefit of the public.

    The Seven Principles of Public Life, also known as the Nolan Principles, which form the basis for ethical conduct expected of people in public office are being routinely and brazenly violated, without care or concern – not only by top politicians, but also the administrative and military elite.

    Consider for a moment, the market in defence equipment for which the government is the only customer.

    The clear message behind the government’s defence procurement policy is that military equipment for the Armed Forces is to be purchased through fair and open competition – the only exceptions being off-the-shelf purchases and single-source development contracts, the latter to be handed out on a preferential basis (to the Select Few).

    But, the problem with letting uncontested, single-source contracts in this way is that the decision on which contractors to pick, and which to leave out is in the hands of a small number of people in Whitehall – leaving them exposed to the charge of favouring the privileged few (usually those who shout loudest in the corridors of power) at the expense of the many, thereby tilting the playing field towards the same selected few and unwittingly entrenching considerable economic power, possibly for decades to come.

    The market in defence equipment, funded exclusively by taxpayers, is there for all private sector players to partake in. Instead of resorting to heavy-handed interventions, the government should deploy the market-based instrument of competition to select the winning contractor on the basis of price competitiveness and value for money. To this end, the defence equipment market should be shaped not by the interfering hand of people in the pay of the State who always get it wrong, but by competitive market forces driven by the profit motive and winning mindset.

    Additionally, there exists an extremely high risk that committing public funds in this way will not deliver the return on investment as advertised, or worse still, squandered altogether because:

    (a) Procurement officials at MoD’s defence procurement organisation in Bristol, who are charged with negotiating the finer details of the contract are hopelessly ill-equipped to deal with the private sector, which means that they will be duped into spending taxpayers’ money on poorly conceived projects – only for this to come to light many years later, when some Select Committee of the House of Commons produces a report on its findings.

    (b) The internal business process used to select the recipient for the contract is susceptible to manipulation and distortion by parliamentary lobbyists in the pay of those who can afford to spend the most.

    (c) It is certain that the final decision on the choice of the single, preferred contractor which is in the hands of the governing elite will be made, not in the national interest but to serve the interests of career politicians or their financial backers.

    But what is worrying about this top-down approach to organising the defence equipment market by diktat is that it is riddled with conflicts of interest because the judgements made by these people, as it relates to the expenditure of public funds are distorted by the fact that they will end up in the private sector via the “revolving door” to pursue a second career, sometime later on. More specifically, there is every chance that they will favour one bidder over others (in response to clear signals) and treat this bidder leniently, when it comes to marking invitation to tender responses because they are completely dependent upon it for their subsequent career choices, when their time in public service comes to an end or their employment contract is terminated abruptly by political edict.

    To add to this wanton act of recklessness, the moment they arrive on the contractor’s premises these people, especially those who had reached the upper echelons of the Civil Service & Armed Forces and who are intent on proving their worth, immediately begin the task of lobbying their former colleagues to swing the decision on down-selection in favour of their new employers – in so doing, destroying the level playing field which is at the very heart of the competition process, not to mention, reinforcing the view that there exists a cosy relationship between MoD and contractors. It is for this reason, and this reason alone, that contractors’ decision on whom to recruit is heavily biased in favour of people who are about to leave the bosom of the State.

    So, we have a situation where the very people who are supposed to ensure fair play are actively engaged in undermining it, for the sole purpose of advancing their careers – aided and abated by defence contractors.

    And because contractors know no other way of bringing-in new defence business other than by subverting the procurement process, they have become trapped in a cycle of repeatedly taking on more and more of these type of people, because their contacts within MoD have a habit of drying-up after a few months due to the massive churn of postholders in the public sector – which means that incumbents displaced by new arrivals are forced to move sideways into other business-critical roles for which they are woefully ill-equipped, bearing in mind that they only got a job in the private sector not on merit, but because of who they knew. It would explain why staff on contractors’ payroll today is made-up entirely of people who were previously in the pay of the State.

    What makes it particularly easy for contractors to exploit these people is the receptiveness of public servants borne of their desperate desire to leave the public sector, as well as, the common traits of sense of entitlement, self-importance and inflated (mainly male) egos.

    Far from facilitating the delivery of equipment to the Armed Forces that is fit for purpose, adequately sustained in-service and constitutes value for money through-life, defence procurement and the attendant defence manufacturing industry that relies on it for its survival is nothing but a protection racket – created to serve the career interests of people who are currently in the pay of the State, and those who were previously in the pay of the State.

    Operating together, these two groups should be seen as an insidious fraternity hell-bent on taking full advantage of their origins deep in the establishment to get the better of the State.

    So, it is clear that the much-vaunted values of selflessness, integrity, objectivity, accountability, openness, honesty and leadership have not got in the way of procurement officials putting their self-interest first, ahead of the public interest.

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