CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 884-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

PUBLIC ADMINISTRATION select COMMITTEE

 

 

ETHICS AND STANDARDS

 

 

Thursday 9 February 2006

SIR PATRICK BROWN KCB

Evidence heard in Public Questions 70-125

 

 

USE OF THE TRANSCRIPT

1.	This is a corrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee, and copies have been made available by the Vote Office for the use of Members and others.
2.	The transcript is an approved formal record of these proceedings. It will be printed in due course.

 

Oral Evidence

Taken before the Public Administration Select Committee

on Thursday 9 February 2006

Members present

Dr Tony Wright, in the Chair

Paul Flynn

Julia Goldsworthy

David Heyes

Kelvin Hopkins

________________

Witness: Sir Patrick Brown KCB, gave evidence.

Q70 Chairman: Let us move straight into our second half and welcome Sir Patrick Brown. Some of us met you informally while you were doing your inquiry into the Business Appointment Rules. We are meeting you more formally now that you have done your report and it has been published. Thank you very much for coming along. Do you want to say anything by way of introduction?

Sir Patrick Brown: May I say something very briefly? I thought it would be helpful if I just outlined briefly for the Committee my approach in doing this review and if I commented on the particular questions that were raised and passed over to you in the Prime Minister's announcement of the publication of the report. I should also say that you may have noticed that the report is relatively short. That is because I could have included lots of earlier references from Nolan and other committees and other sources dealing with some of the issues that I approach, but I thought that, while the Committee will have read the report in its entirety I am sure, I wanted other commentators at least to try to get through it. That is why it is so short and I hope that I have covered everything in it. As I say in the report, the rules were put in place for Crown servants at a time when the issue normally was employment after retirement, so it did not seem unreasonable in those days to impose a delay in taking up appointments after retirement, because the individual would have the financial cushion of an occupational pension. What has changed is that people are now coming into the Crown service on short-term appointments. They therefore expect to continue their career in another sector immediately on leaving the service. They cannot afford a loss of income. Recognising that the reputation of the public service needed to be protected, I therefore asked myself, and many other people who kindly agreed to be interviewed, under what circumstances it would be reasonable to refuse permission for a departing Crown servant to join a new employer. The result is in the report. In looking at the questions raised by the Prime Minister, I limited the delay on employment under the material influence test as proposed to two years because it seemed to me unlikely that, if challenged, the courts would uphold a longer ban. There should not be discretion to impose a shorter period. Two years provides a major disincentive to individuals who might even think of doing a favour to a potential employer, and I do not believe that is happening, and it would provide a reassurance to the public that there can be no question of jobs for favours. As to the question of whether the Civil Service Commissioners should be the body charged with managing the independent review that I propose, my main concern was that there should be a single body overseeing the process so that all Crown servants would be dealt with consistently. The Commission, as Baroness Prashar has just said, already deals with Civil Service matters, but not departure and it seemed reasonable to me to make them the expert body in that field. If this is not acceptable, then another independent body in whom the public would have trust, for example the National Audit Office, could take it on. In their reply the Government, no doubt under the urging of my friends in the Treasury, raise cost as an issue. I have to say that I cannot see that the cost of what I am proposing will be very large and in any case, in a matter as important as this, it should not weigh in the balance.

Q71 Chairman: Thank you very much for that. When you were set up, the question was: what is the problem to which you are the solution? Your report is commendably short and we thank you for that and, as I read it, in a way you have not found much wrong with the way in which this is done now. We have just heard Baroness Prashar say that she thought the system worked well. There seemed not to be a great problem crying out for a solution. If people are saying the system works well, the other question is: why do we need to change it?

Sir Patrick Brown: The system has been working mainly with retiring people, but there have been problems and I am sure there will be problems in future if the arrangements are not changed. If I just take the regulatory field, there was a case where someone worked in the rail regulator's office and wanted to go back to work on the railways and that was her expertise. The Committee did not think that was a good idea and I cannot see that that was very helpful to the individual or indeed to the government in the sense that if it had been more generally known, people would think twice about joining a regulator. People genuinely do not understand when they come into the Civil Service the fact that they may be denied immediate employment after they leave.

Q72 Chairman: So the intention of the inquiry and indeed of your report in a sense is to make it easier to move from one area to another.

Sir Patrick Brown: It makes it easy to move, except in a very specific circumstance.

Q73 Chairman: You do not think that making it easier in that sense begins to undermine the balance that we look for in this area which is the balance of public confidence?

Sir Patrick Brown: I do not think so. Under the present arrangements, many appointments are approved without comment by the committee. This would not weaken it: it would strengthen it. If you accept that the damage to the reputation of the Civil Service or Crown service is greatest if people think there have been favours for jobs, putting it crudely, then my proposal deals with that. The other restrictions placed by the advisory committee, on lobbying for example, are not very effective or very helpful. In some cases the committee will write and say someone may not lobby the government but can of course approach them in the normal course of business. I am afraid I fail to see a distinction between the two.

Q74 Paul Flynn: When you retired from the Civil Service after 25 years' work there, you took up a number of jobs. What was your salary from those jobs?

Sir Patrick Brown: The first one was a non-executive directorship at £20,000. The next one, which was nearly full time, was about double my salary.

Q75 Paul Flynn: Was one of them £69,000?

Sir Patrick Brown: No that was another one.

Q76 Paul Flynn: A total. You had one for £69,000, one for £20,000 and one for £40,000.

Sir Patrick Brown: No, the timing is wrong.

Q77 Paul Flynn: Okay. In relation to your Civil Service salary, what was your salary when you retired from the Civil Service?

Sir Patrick Brown: I got a great deal more money.

Q78 Paul Flynn: Could you give us an amount?

Sir Patrick Brown: Double.

Q79 Paul Flynn: And you had your pension as well from the Civil Service.

Sir Patrick Brown: I had a very small pension from the Civil Service. I had only been in it a short time.

Q80 Paul Flynn: Why do you think you were asked to do this review? Why you individually?

Sir Patrick Brown: Why me individually? I presume it was because before I was a civil servant I was in business, then I came into the Civil Service. I left the Civil Service and went through the appointments process when I went back into business.

Q81 Paul Flynn: May I speculate on why you might have been asked by the Prime Minister?

Sir Patrick Brown: You can speculate, but I cannot reply.

Q82 Paul Flynn: Let me put the question to you. If you refuse to answer, by all means refuse to answer. You were a person who benefited enormously financially from the Civil Service with a lucrative retirement job and you were asked to write a report on this particular subject. Do you think there was an influence in the person who asked, or was it because of the fact that you were an enthusiastic privatiser when you were a civil servant, or that the Prime Minister knew what kind of report you were going to write?

Sir Patrick Brown: The Prime Minister certainly did not know what sort of report I was going to write because I did not either.

Q83 Paul Flynn: He had a good idea I think, did he not?

Sir Patrick Brown: It is unlikely. If I did not know, I am not sure how he could.

Q84 Paul Flynn: Clearly, coming from the background of having profited yourself so handsomely from a retirement job from the Civil Service, you were likely to approve of a system which benefited you personally so wonderfully.

Sir Patrick Brown: If I may say so, I have benefited from my later career quite a lot because I had an earlier career in business.

Q85 Paul Flynn: You would regard yourself as being sufficiently independent to write an independent report on this, would you, rather than someone who was outside and not influenced in any way by their own personal experience?

Sir Patrick Brown: You are implying that I have been influenced by somebody and I deny that absolutely.

Q86 Paul Flynn: Okay, so you would say that the report is entirely impartial. You spoke to people and you refer to the Ministry of Defence as being very important but you spoke to other organisations. Which were the other organisations?

Sir Patrick Brown: I spoke to a lot of people. I spoke to people in the public service, in the regulatory area, to academics, to people in the press and I spoke to one particular lobbying group.

Q87 Paul Flynn: Who were they?

Sir Patrick Brown: I have said to everybody that I shall keep them anonymous because that way ---

Q88 Paul Flynn: When you say a "lobbying group" do you mean people lobbying ...?

Sir Patrick Brown: Sorry, a campaigning group. Lobbying is the wrong word; a campaigning group.

Q89 Paul Flynn: Campaign Against Arms Trade.

Sir Patrick Brown: A campaigning group with an interest in this subject.

Q90 Paul Flynn: The Campaign Against Arms Trade has sent us a note saying some flattering things about your proposals; some they approve, some they do not. They draw attention to one particular case which is Sir Robert Walmsley, who claimed he had taken no part in the evaluation of the Bowman radio project where the successful bidder happened to be his new employer. His new employer was General Dynamics. The job that Sir Robert Walmsley was doing was for the Ministry of Defence: he was Head of Defence Procurement. Is it plausible that the Head of Defence Procurement had no influence and no knowledge that influenced him in his decisions when he became head of the company which won the contract?

Sir Patrick Brown: It is plausible, but that is why I am suggesting there should be an independent review under my proposal of the relationship between the individual leaving and the prospective employer, to find out whether in fact the individual had a material influence on the decision.

Q91 Paul Flynn: What effect do you think it has on a civil servant now? We have looked at civil servants in the past who would see that there was a separate public service ethos in the Civil Service and looked to retirement to give them a decent pension. They had a job with some influence and power, not a huge salary but they would get perhaps their knighthood, their gong, there were certain other rewards and the satisfaction of doing a good job. Now somebody retiring and looking forward to their retirement sees the possibility of a second job. It occurs not just in the Civil Service but with ministers as well and I believe this is something we should look at including in the report. Is it not likely that we are undermining the whole ethos of the Civil Service because, certainly in the last part of their careers, they are looking not to their pension but whether they can triple their salary with a job in an area where they are selling their experience and knowledge from the Civil Service job?

Sir Patrick Brown: You are absolutely right. I think the Government has announced that 87,000 civil servants are for the chop; of course they are going to be looking towards the next career.

Paul Flynn: We are talking about ones who are retiring. That was a rather cheap point, but carry on.

Sir Patrick Brown: No, it is a very serious point.

Paul Flynn: We are talking about civil servants who retire either as the head of a department or in procurement and who go into these large jobs. I represent many thousands of civil servants and very few of those are in that category you described and that is a serious matter, but what we are doing is undermining the ethos of the service from the top and it is rotting like a fish from the head first. To talk about junior civil servants who will lose their relatively well-paid jobs is nothing to do with the subject we have here.

Sir Patrick Brown: Well I can disagree with you on that. Addressing the very senior civil servants, none of them in their minds says, "Well, if I give a favour to X company, I can go and work for them". I do not believe that happens. However, if my proposal is adopted, you will find out, or someone will find out, whether indeed there was that sort of influence over a decision to provide a benefit to a prospective employer. At the moment it is an allegation.

Q92 Paul Flynn: This is a signed affirmation you are talking about, the suggestion that they make a promise so that when in fact they are working for Mega Greed PLC later, something comes round to the board and there is an important crucial decision to be made, hundreds of people could lose their jobs, big fat contract, you are saying that a signed affirmation by a civil servant is going to bandage his mouth to such an extent that he will not give any hint, nod that in fact it should go one way or another because of his influence? Do you really think that a signed affirmation would work?

Sir Patrick Brown: It is a helpful reminder. It is something to bring to everybody's attention, including the future employer, that there is a duty of confidentiality. But looking at it the other way around, do you think a delay of three or six months suddenly means that the individual does not have the information?

Q93 Paul Flynn: As you are asking me the question, I shall give evidence to you. The usual idea is that you give evidence to us. I should say that the value of the civil servant to a new employer does diminish very rapidly as the period goes on. They have less influence with their previous colleagues because they might have left or retired too. Their knowledge is out of date, so they have less to sell. I believe why people are being recruited by firms from defence departments is because of their influence among colleagues and their knowledge. If there were a period of five years, that would certainly reduce their effect, their knowledge and reduce the amount of money they could get in the marketplace. I believe that is the reason why a five-year gap should be imposed rather than asking them to sign a piece of paper. Would you not think that would be more effective and protect the public interest?

Sir Patrick Brown: As I said earlier, I do not think the courts would uphold a five-year ban. Would you apply this to all Crown servants leaving, to those with decision-making powers, or only to those retiring at the end of their career?

Q94 Paul Flynn: We do it with common sense: for those in senior positions who have confidential information and it might apply to ministers as well. If you look at the ethos of the Civil Service, how concerned are you? Do you see yourself as a businessman, rather than a civil servant? You were there for 25 years, but you were brought in in order to carry out privatisations, which you did very successfully.

Sir Patrick Brown: No, that is not true. I did indeed do a number of privatisations, but I joined as a perfectly ordinary principal, as it was in those days.

Q95 Paul Flynn: From what? What was your previous job?

Sir Patrick Brown: I was a management consultant.

Q96 Paul Flynn: Okay, but you were involved in the privatisation of the National Bus Company, the water industry, the Property Services Agency and the rail operating companies and so on. Do you not see a difference in the ethos in the civil servants between the time you joined and the position when you retired?

Sir Patrick Brown: Not in the ethos, no. When I joined, you spent a lot of time being taught, sitting with Nellie basically, what was and what was not acceptable in the Civil Service, what the requirements were. We all had a copy of the management code which was very thick and I am delighted to see a much shorter version now. All the time I was in the Civil Service and while I was a permanent secretary the ethos remained. What was interesting was that when I brought in people at senior level from outside, it was clear that I, as the permanent secretary, needed in a sense to be the Nellie with whom they sat to try to show them the difference between the business approach and the qualities you needed in the Civil Service. The fact that you are serving a minister is entirely different from serving shareholders, but the ethos is still the same.

Q97 Paul Flynn: Would it be true to say, as the Campaign Against Arms Trade have said, that in your report you are arguing for a weakening of the present restrictions?

Sir Patrick Brown: No, I do not think I am. I am looking at the reality of it. What is it that the public needs to be reassured is not happening? I am not fussed about lobbying, as Nolan was not. He said it is a normal part of the political process, but it needs to be transparent.

Q98 Kelvin Hopkins: I may say I read these papers with open-mouthed astonishment and I am still open-mouthed even now. When you were in the Civil Service, you were involved in the privatisation of the National Freight Corporation, the ports, the National Bus Company, the water industry, the Property Services Agency and rail operating companies. Now you have jobs in precisely those industries which were privatised. A cynic and somebody looking back on the history might well say that here was a civil servant saying privatise these, fill your boots with public money and a little bit of a job later on would go down nicely. He need not necessarily say that, but the implication was clearly there. Then, at a later stage, you are invited to talk about the relationship between business and the Civil Service and Downing Street. Sir Andrew Turnbull - apparently that is code for Downing Street - blocks the appointment of a real civil servant, Sir Nigel Wicks, a traditional public service ethos civil servant and insists on you having the job.

Sir Patrick Brown: Who also went into the Civil Service from business.

Q99 Kelvin Hopkins: Well Sir Nigel has been here and I know from what he said that he has a very strong commitment to the public service ethos. This is the business ethic, not the public service ethic surely?

Sir Patrick Brown: I do not think so.

Q100 Kelvin Hopkins: And then you have said this was just reality, but you have argued in favour of an even more relaxed system for the relationship between business and government, a more relaxed system even than that. You have obviously done extremely well out of this yourself; no doubt others have as well. If the system becomes more relaxed, is it not likely that senior civil servants will say that it is an open house now, they can flog off public assets, taxpayers' capital, and make a killing for themselves when they get out, and politicians as well. They can all say that it is really about filling their pockets and making as much money as they can personally rather than serving the public interest.

Sir Patrick Brown: No, that is not true. I suppose that privatisations were part of a political manifesto. Civil servants working with me on the ones I did were there to carry through what the Government asked of them, properly and ensuring that it was done with integrity. That is what the Civil Service is for. It is part of the delivery mechanism, when ministers have decided and legislation is put in place; that is what civil servants do. You obviously see some connection between me privatising the buses and being in a transport company. I plead guilty. What they wanted, I assume, was the fact that I understood the background of the issues relating to the activities which they were carrying out.

Q101 Kelvin Hopkins: I must say that I am tempted to put down a couple of early day motions calling for support for PFI schemes and I might then get a non-executive directorship with your company when I leave Parliament.

Sir Patrick Brown: May I just add that I was not involved in selling the bus company, I was involved in managing the process in government, which is the legislation. The actual sale was handled by the National Bus Company itself. If you are trying to say that with the bus privatisation I was setting myself up with a job in later life, that is unreasonable.

Q102 Kelvin Hopkins: I came along here today to ask a very specific question about a man called Mr Stewart who is now the commercial director of the Department of Health. I asked this question of John Hutton when he came to the Committee, because Mr Stewart is now responsible for pushing Health Service PFI schemes from inside the Department of Health. But he came from a company outside, where his job was to secure PFI schemes from the Department of Health. I was going to ask you this question, it might be a trick question, but then it turns out that he came from a company called Amey, of which you are the chairman. Were you involved in that at all?

Sir Patrick Brown: No.

Q103 Kelvin Hopkins: Well that is interesting. As I say, I was open-mouthed and I am still open-mouthed. Do you not think that perhaps 2,500 years ago Plato had a point when he wanted a very strong dividing line between the world of government and administration and commerce?

Sir Patrick Brown: The reality is these days that successive governments have increased the contact and the involvement of the public sector in private sector activities - you mentioned the PFI - they are using more consultants. As Baroness Prashar said, she wants a Civil Service that is more outgoing. It is more outgoing; it does need more expertise. You said earlier on that civil servants understood very well the realities of business. I have to tell you that is completely untrue. There is still a real lack of understanding of what business is about in the Civil Service. The ethos and the drive are so different.

Q104 Kelvin Hopkins: Indeed. One is about making money: one is about serving the public interest. Are they not two different things?

Sir Patrick Brown: Yes, but it is important to understand the other side, whether you are in negotiation or whether you have a contract with them or they are doing work for you. It is surely very important to understand, if you are doing business with somebody, where they are coming from and how they approach things. I assume that is why the Government are pressing on with bringing in more people from - outside to bring in fresh life and fresh understanding.

Q105 Kelvin Hopkins: I do not want to cast aspersions on their motives, but this week there has been a lot of press coverage of corruption in Kenya, where politicians have apparently been buying flash cars for themselves with money intended for aid. Are we not looking at a poor country doing small beer things when there are really much bigger things going on in our own country? Will history not contrast us focusing on a few corrupt politicians in a poor country and this massive rip-off of the public purse which has been going on in our own country?

Sir Patrick Brown: I cannot agree with you; I do not see a great rip-off of the public purse. We do have the National Audit Office which is a very good and great institution looking at what departments do.

Q106 David Heyes: Can we go back to this affirmation letter? How does it work as a constraint?

Sir Patrick Brown: It is not intended to be a constraint. At the moment when people leave, as far as I found out, there is no specific interview or statement or reminder of their duty of confidentiality and of the importance of being discreet about things people know. I thought that this sort of affirmation and the process of getting the employer to agree not to press people to give up confidential information would help. If people wanted to divulge commercial information or confidential information, there is no way you could stop them, even by saying they spend six months on gardening leave or waiting for the job. There are telephones and e-mails. If people want to do it, which I do not think they do, they can do it. I did feel that with an affirmation and the employer involved, there would be a clear understanding when people went to a new employer as to what they should avoid talking about. I thought that would be helpful. At the moment there is nothing like that; it is up to individuals to remember.

Q107 David Heyes: That is not legally enforceable; there are no sanctions attached.

Sir Patrick Brown: There are no sanctions attached to it.

Q108 David Heyes: And it is not monitored for any potential breach.

Sir Patrick Brown: Potential breaches would perhaps come to light as they do now, if there are any. It was just an attempt to remind people, which does not happen at the moment, that they have this duty, particularly for those who come in on short-term appointments. You will see that I have asked for a more rigorous induction process to try to instil in people, before they start work in the Civil Service, the requirements of the code, which are not well understood when people first come in. That is why, when people leave, the affirmation is yet another piece of training, saying "You have been here five years. Don't forget that you mustn't disclose what you have learned in government and that it is particularly important because government gets information that nobody else will".

Q109 David Heyes: My mother always told me to be a good boy when she sent me off to school and I rarely was. She never found out. It seems to have the same weight that that had. Let me take you on to this question of material influence. That is where the debarment would derive from, is it not, if within the last three years of state service the individual had a material influence which might benefit a prospective employer? What is "a material influence"?

Sir Patrick Brown: Inevitably, if this is adopted, each case will be dealt with on its merits and precedents will emerge as it goes along. If you think of some hypothetical examples, if a senior official overruled a proposal of his team to award a contract to one body and decided, on what appeared to be reasonable grounds, to award it to another, made a specific choice, that would seem to me to be "a material influence". If you are an official who has the responsibility for deciding the criteria against which tenders are judged, that seems to me to be a material influence. The manager of a regulatory team dealing with setting pricing for one company in an industry, for example, seems to me to be "a material influence". In practice, if it is adopted, the investigating team will come along and say this seems a prima facie case and I am proposing that a panel should then judge whether the prima facie case was one where a restriction should be imposed.

Q110 David Heyes: From what source would the panel be drawn?

Sir Patrick Brown: I suggested the Civil Service Commission. The Government are obviously saying they are not sure this is right.

Q111 David Heyes: It has taken the Government an awfully long time to respond to your report, has it not? It has taken the best part of a year. Why was that?

Sir Patrick Brown: Of course there was an election in the middle which tends to divert Government's attention to other things. Lord Bassam of Brighton said at some point that the Government were considering how to respond, so they have obviously been doing that.

Q112 David Heyes: Was a row going on behind the scenes?

Sir Patrick Brown: The report was handed in and that was that. I rang up from time to time to ask whether they were going to publish.

Q113 David Heyes: You judged that the period of debarment should be two years for somebody who met these criteria. Why did you pick two years?

Sir Patrick Brown: Because I thought that two years would be long enough. In business people move around quite a lot, so if there were an attempt to provide favour for a job, by two years' time anybody you had done a favour for would have moved on. Two years also seemed to me long enough to persuade individuals in the Crown service; they would not want to wait that long anyhow, they would want to go and get another job. I also thought two years might just be upheld by the courts, if it ever went to court. They might say, because it was a national interest issue, that they would allow two years. I am aware that the courts do not like periods that long, in restraint-of-trade cases in the private sector, but that is usually about joining a competitor. The state does not have competitors.

Q114 David Heyes: You said "anybody you had done a favour for". Maybe I have not understood you clearly. What did you have in mind when you said that?

Sir Patrick Brown: I am trying to propose a system which will reassure the public that people will not get jobs for doing favours to outside businesses, which is part of the allegation which has been made.

Q115 David Heyes: I took it by inference from what you said there that it was something which happened, that civil servants do favours for people in business situations. It seemed to flow naturally as a consequence of what you were saying, as though you saw that as normal.

Sir Patrick Brown: No, you cannot infer that from what I said. If you draw that inference, then I phrased it badly.

Q116 Chairman: I also noticed what you said there and it was a very curious thing to say. Your point about material influence has nothing to do with favours, as I understand it, it is simply to do with having had some sort of relationship which might have had an outcome which was beneficial, but it was not to do with doing favours, it was doing more business, was it not? That is a rather important distinction.

Sir Patrick Brown: Yes. I was trying to look on the bad side, which I do not think happens, but saying, supposing someone did have a material influence on a decision to a prospective employer and did it deliberately so that he or she might get a job. I am saying that a period of two years seems to me long enough to make anybody who thought of doing it think otherwise. I do not think they do, but it is quite a harsh constraint to say to somebody that they may not join a company for two years, even if they particularly want to.

Q117 Julia Goldsworthy: Following your retirement from the Civil Service you went on to have several business appointments.

Sir Patrick Brown: May I say that retirement was early?

Q118 Julia Goldsworthy: I just want to know how you found the Business Appointment Rules and whether you think that your new proposals would have materially affected your subsequent career path. What do you think the difference would have been?

Sir Patrick Brown: I do not think they would, because under the test I have here neither of the companies I joined in the first two years met that criterion.

Q119 Julia Goldsworthy: How did you find the Business Appointment Rules?

Sir Patrick Brown: The process was slow and very annoying to the prospective employer who said "Haven't you heard yet? What are these people doing?", but that is probably because there was a great deal of pressure on the committee at the time.

Q120 Julia Goldsworthy: I should like to ask you your thoughts on what rules should apply to ministers and former ministers. At the moment there is a fairly unified system which applies to both civil servants and ministers. Do you think your single test, single sanction approach could apply equally to former ministers?

Sir Patrick Brown: I think it could apply. Whether it should is for you not for me.

Q121 Julia Goldsworthy: Do you think if it had been in force it would have saved David Blunkett his misunderstanding over what he should and should not do?

Sir Patrick Brown: If I understand the press, Mr Blunkett did not ask the question. If this were adopted and anybody were not to ask the question, they would be in breach.

Q122 Chairman: May I come back to the general issue here? The proposition is that we live in a world where there is far more interpenetration between the public and private sectors, one facet of which is increased movement of people from the private sector into government and then outside, so we accept the changing context. Then the question is: what does that mean for the rules, that we have about traffic both ways? Your conclusion is that we have in a sense to make the rules more relaxed to accommodate the changing context with the provisos which you have put in, but someone could argue that because it is all more porous these days, because there is more interpenetration, we need the rules to be more rigorous.

Sir Patrick Brown: I understand the point. If you want to make the rules more rigorous and say to people "By the way, if you come in on a short-term contract, it may be that you will not be allowed to work in your sector of interest" - defence, electricity, or whatever it might be - then you will not get people coming in. They need certainty that they can go back and resume a career and they need certainty as to what the test will be which might deny them that. It seems to me that we cannot have nothing; we have to show that there are some basic safeguards on the jobs for favours issue.

Q123 Chairman: One of the points of having these business appointments rules of procedure and the things which went before them is to give public reassurance that there is not something funny and improper going on here. All I am putting to you is, understanding your logic, that if the effect of this is a procedure which eases the interpenetration so we have lots more stories around of civil servants who suddenly pitch up in the organisations with whom they have been doing business in government, the effect of that is to corrode people's view of the whole system and indeed of the Civil Service itself. It may be that, for all the best reasons, we shall have paid a price which is too high, shall we not?

Sir Patrick Brown: If a civil servant or Crown servant on a short-term contract turns up in a company with which they have had dealings, under my proposals there will be an independent investigation, which will be transparent and published, into what that relationship was. Civil servants deal with businesses all the time. The question is whether it was normal course of business and they were not providing specific benefits. Otherwise, if you want to say we cannot put up with the public furore every time a Crown servant moves to a private sector job, where do we go from there?

Q124 Chairman: The only defence against any charges which are made under your system will be "Ah, but I did not in the previous two years in my public service employment give a specific material benefit to this company". What I am putting to you is that may not be a compelling or sufficient argument to offset the erosion of public confidence.

Sir Patrick Brown: It may not be. I think it is an argument in a situation where people working in the Civil Service and other Crown services have to have relationships with business and do business with them.

Q125 Chairman: We shall have to draw to a close now. May I thank you for the interesting session. I am sorry it was a little robust at times, but that is how we do business. You get Plato as well though. There are not many select committees where you get Plato twice. We are all having to develop our thinking in this area and you have helped us greatly to do that.

Sir Patrick Brown: I hope so.

Chairman: Thank you very much indeed.