UK Politics

Call to limit businesses profiting from political ties

Boardroom table
Image caption Ex-Ministers are often recruited by big businesses and go on to lucrative careers in the boardroom

Can a modest advisory group safeguard the public interest as big business bids to recruit former ministers to help deliver lucrative government contracts?

What do government ministers do when they leave office? And what happens to top civil servants when they retire?

Some of the answers can be found on the website of a little-known government-funded body: The Advisory Committee on Business Appointments (Acoba).

A stand-alone committee, currently comprising four peers, two knights and a dame, Acoba's brief is to give advice to Whitehall's high-fliers about possible conflicts of interest when considering a change of job.

"We are there to prevent an unfair advantage being derived by the individual who uses the background of his employment in government either as a minister or a civil servant for the benefit of his career subsequently in industry," explains committee chairman, Lord Lang, former Trade and Industry Secretary in John Major's government.

Senior civil servants and ministers are asked to submit an application form to Acoba when they are thinking about accepting a private sector post.

The form is reviewed by the committee, who then advise the prime minister whether the appointment should be allowed or not.

The latest jobs update on Acoba's website notes ex-Defence Secretary Geoff Hoon's appointment as senior vice-president of AgustaWestland International, the Anglo-Italian helicopter manufacturer, almost two years after leaving government and six years after leaving the Ministry of Defence.

Meanwhile, former First Sea Lord Admiral Sir Jonathan Band moves from leading the Royal Navy to advising US arms giant, Lockheed Martin.

Sir Jonathan was advised to wait six months before taking up the new job.

Both moves were approved by Acoba subject to the now standard warning that they must not lobby ministers or civil servants on behalf of their new employers for a period of two years after leaving office.

Since Acoba's launch in 1975 there has been a marked increase in the number of ministers and mandarins passing through the so-called 'revolving door' between government and the private sector.

Companies keen to win NHS contracts now head-hunt top civil servants from the Department of Health.

Ex-ministers of education find new jobs running universities, and Treasury staff are in high demand throughout banking and industry.

There is a growing body of opinion that a gentlemanly system of review and advice conceived 35 years ago may not fit modern needs.

"There has been a lot of change in the last 20 years and the regulation hasn't really kept up," says Dr Liz David-Barrett, an Oxford University research fellow and author of a recent Transparency International (UK) report on the revolving door.

New controls not enough

Although the coalition government increased the maximum lobbying ban from 12 to 24 months, Dr David-Barrett believes tougher safeguards are needed to ensure that private sector companies cannot benefit unfairly from insider knowledge when they take on a former top civil servant or minister.

"There should be a differentiation according to the type of responsibility a civil servant or minister has," she says.

"For those involved in procurement decisions then the ban on lobbying should be extended to three years from the current two.

"If people have worked in very high risk departments like defence then maybe there should even be a lifelong ban in the associated industry."

The report's concerns are shared by MPs on both sides of the House of Commons, including some members of the influential Public Administration Select Committee.

The most common criticism of the advisory committee is that it can only issue advice.

It cannot monitor whether former ministers and officials actually follow their advice, let alone punish them if they do not.

Lord Lang warns that tougher restrictions on people taking up new jobs in the private sector could open his committee's advice to legal challenges under 'restraint of trade' or even Human Rights law.

And he insists critics mistake the committee's role.

"We don't have enforcement powers, we are an advisory committee," he says.

"If they [critics] want an enforcement agency, a policing body, a regulatory body, a statutorily based body, let them lobby government for it."

He said governments on both sides of the political spectrum had taken the view that an independent advisory committee was what was needed.

"If people want to change it they would have to recognise that it would be quite different from the body we have at the moment" he said.

"It would involve a statutory base, it would involve all kinds of policing and investigative powers and I don't think that is what most people would like."

File on 4 is on BBC Radio 4 on Tuesday, 26 July at 2000 BST and Sunday, 31 July at 1700 BST. Listen again via the BBC iPlayer or download the podcast.

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