Lobbying: Access and influence in Whitehall - Public Administration Committee Contents

Examination of Witnesses (Question Numbers 820-839)


19 JUNE 2008

  Q820  Mr Walker: I am not talking about MPs but ministers and senior civil servants. What is the Code relating to ministers and senior civil servants, not special advisers or not press officers but senior civil servants, accepting hospitality from the Daily Mail or The Express or somebody? What are the rules relating to that?

  Mr Watson: You have to let me clarify this after the Committee. I suspect the publication we are going to do later in the year if it was hospitality over a certain amount would include the press, but if I could come back to you on that I will find out exactly.

  Q821  Mr Walker: Obviously when you meet the press there is a purpose. The press tend to report the conversation but not all meetings with the media get reported by the relevant journalist. If there was a register of meetings that you had had as part of your day-to-day jobs with private companies, should that register be extended to all meetings and include meetings with journalists. It might cause some embarrassment occasionally if something was leaked and not attributed but do you think that should be covered?

  Mr Watson: If that is a recommendation of the Committee then obviously we will have to consider it.

  Mr Walker: I did not ask that.

  Q822  Chairman: That is ministerspeak.

  Mr Watson: Let us be candid with you. There is not a cat's chance in hell that you are going to get a register of every politician who has lunch with a journalist.

  Q823  Mr Prentice: Something that was raised by Tom Harris about franchising, because decisions there are worth millions, we are not talking about business lunches, £100 or £200, but millions perhaps billions. You told us that Jack Paine, who is here, is the filter who protects you. The Transport Committee, my notes tell me here, says that the re-franchising process is driven by consultants and lawyers. What steps do you take to ensure that the consultants the Department of Transport employs to advise you on franchising and re-franchising do not have another foot in the industry because many of them have an old British Rail background I suppose? Do you check them out?

  Mr Harris: It is true that the re-franchising process is driven by consultants and lawyers working for the individual train-owning companies. At the very start of a process of course they are hyperactive, they are trying to get as much information as they can about the franchise, about the nature of the geographical area and a huge amount of work goes into those train operating companies. They always employ firms of consultants to gather that information and input it into the system. In terms of making sure that civil servants are not unduly influenced by those consultants, as I say as soon as an invitation to tender is actually issued that is when the hatches are brought down as far as the DfT is concerned. Nobody who is involved at all in assessing those bids is open to influence by outside consultants from the invitation to tender, including myself. That is the advice I have been given. For example in the South Central franchise, ITT goes out later this year and at that point I would no longer meet any of the trade and operating groups who have expressed an interest in the franchise.

  Q824  Mr Prentice: It is hermetically sealed and there is no possibility that consultants could be working for both sides.

  Mr Harris: They can be working for both sides. What I would hope is that civil servants involved in the franchise process would be open in as much as if a train operating company, represented either by themselves directly or by a consultancy, needed more information that was a legitimate piece of information I would hope they would get that information. I would not want it to be a situation where they could not speak to the edifice which is the DfT. There has to be some reasonable access to get information for a bid. I do not have a problem with that. In terms of being able to exert influence, it does not happen. Can I give you one example? Within a couple of weeks of my becoming a minister I was asked to open the envelope announcing the winner of the South West franchise. It was a very strange process because at that point opening the envelope was a bit like announcing the winner of an Academy Award. That was the first time the minister has any idea about who has actually won the franchise. Likewise, almost nobody in the room, including officials, knows the name of the winning company until the minister opens that envelope and the only person who knows, who put that bit of paper into the envelope, is Jack who is effectively hermetically sealed from the whole industry from the minute the ITT is put out. It is a very robust system.

  Q825  David Heyes: I was going to ask about this area. Going back to the beginning of this session when we asked which lobbying organisations came to mind, the first ones you mentioned were the Rail Industry Association and the Association of Train Operating Companies. You described them in passing as respected organisations. You then went on to talk about what I guess are more user orientated groups and you mentioned Rail Future. You were a bit disparaging about them and said they were train spotters.

  Mr Harris: I do not use train spotters as an insult at all; it is a fine occupation.

  Q826  David Heyes: Is there a hierarchy in your mind of the people you should listen to?

  Mr Harris: If I am being completely honest, if there are a lot of demands on my diary and I have room to put one more meeting in and the choice is between the Director General of First Group or a rail user group representing a small station somewhere in the West Midlands the chances are I will speak to the Director General of First Group because I have a relationship there. There is almost always a financial relationship between the department and the particular train operating company. In all honesty I could not say that someone who is a member of a voluntary group supporting the railways would have exactly the same access to me as one of the train operating companies.

  Q827  David Heyes: You did not mention, when you were volunteering who you get lobbied by, rail unions. I would have though they would be making very significant attempts to influence.

  Mr Harris: On the first day I became a minister I was presented with a long list of organisations by my private secretary of people I should meet. I took one look at it and said there were no trade unions on the list and could you put the three rail unions on it and give me the list back. I have not had the list back yet but I do make the effort to meet the trade unions on a regular basis.

  Q828  David Heyes: I am not sure how you make the decision about which type of organisations to give weight to. Is it something that is in you because you are a politician or does it come with the status of minister? Is there a process you go through?

  Mr Harris: In February this year we had a political difficulty with First Great Western, the train operating company in the South West of England, whereby the Secretary of State and I had to decide what to do about its under-performance. Given the political sensitivity and given the effect that was having on passengers, I think it was entirely legitimate of me to spend quite a lot of time speaking to First Great Western on a formal basis with the managing director and with the route director of Network Rail in that area.

  Q829  David Heyes: That is more consulting and taking soundings rather than you being on the receiving end of lobbying from them and that is the focus of our interest.

  Mr Harris: It was two ways and it always is with train operating companies. If any train operating company comes to see me because they want to raise a concern about rolling stock shortage, for example, I will always use the opportunity to ask them or to promote the Government's policy to them as well. I have never from memory been in a situation where there has not been exchange and where it has only been one way.

  Q830  David Heyes: How do you go about ensuring that you listen to a variety of perspectives and not just the big strong powerful ones?

  Mr Wright: Given the thrust of the department about locally devolved matters, I am particularly keen to speak to relatively small scale tenants groups. I think that is very important and is one of the reasons I go up and down the country discussing that. I take advice from officials and I trust the judgment that I get. A big part of my ministerial box every night is diary engagements and advice as to whether we should or should not meet with them. I can only think of one example where officials advised that I should not meet with people but I said I would like to and that was a transport group, because I think the importance of housing communities and related infrastructure about transport is very important. That is when I went against official advice and said I would like to meet with these people.

  Q831  David Heyes: Are you the minister who is responsible in government for this issue of lobbying?

  Mr Watson: I think ministers themselves have to take personal responsibility for how they conduct themselves. What underpins our approach to lobbyists is the Ministerial Code. It is very important that ministers on the subject of access strive to give a level playing field. There should be no question of preferential access for different groups. You also have to recognise that some people carry gravitas, greater weight, greater strength of knowledge on particular issues, so you have to allow ministers some flexibility to make a judgment on who comes to see them and who does not. They should always take advice from officials as well.

  Q832  David Heyes: When our report is published later this year, whether it is a controversial report or not—we do not know at this stage what the recommendations will be—is yours the desk it will land on?

  Mr Watson: I suspect it will land on my desk and others. I have an open mind on where to go next on some of this stuff so I would read the report with great interest. Can I also say that from previous experience it usually pays to listen to the Public Administration Committee. I just have memories of the MoD.

  David Heyes: I think I have just been lobbied!

  Q833  Kelvin Hopkins: I separate in my mind two kinds of lobbying: lobbying for contracts and lobbying on policy issues, which is altruistic and I like to think I do quite a lot of that myself, as a Member of Parliament. If we can go back to the rail franchises, I am sure Tom is right and within that box Tom describes everything is absolutely straight. But something somewhere happens which means that decisions are made which could be construed as being against the public interest. South East trains sort of collapsed and it was later run effectively in the public sector for a time when its performance improved both as an operating company and also financially. But it was forced back into the private sector despite the fact that it was apparently doing a better job for the public than the private franchisees. Someone somewhere lobbied hard for that to happen. Presumably it was ATOC[1] or the TOC[2] saying we do not want a public sector comparator which shows us up as not doing a good job. How did that happen? How was that decision taken and who lobbied you?

  Mr Harris: As you know, that happened long before I was appointed as minister. I would be happy to confirm this after the meeting but I would be very surprised if any private sector company would have to lobby on that since having a privatised railway system, fully privatised without a public sector comparator, is actually government policy. If it were to remain in public hands that would be against government policy so I do not think you needed a private company to lobby in favour of government policy on the railways in that instance.

  Q834  Kelvin Hopkins: Even when it was evidently in the public interest to keep it in the public sector and not put it back in the private sector?

  Mr Harris: My own view would be it would not be in the public interest to keep it in the public sector and the performance of South East Trains has improved since it went back to the private sector.

  Q835  Kelvin Hopkins: Let us take Jarvis. Jarvis has a pretty appalling record in many respects and almost went bankrupt at one point. At this point we still have not found out the whole truth about Potters Bar. Questions are still being asked and we still want to find out what happened. That was clearly a Jarvis responsibility and yet Jarvis continues to get government contracts. What pull does Jarvis have? Who lobbies you? Who lobbies government on behalf of Jarvis?

  Mr Harris: I can honestly say that I have never been lobbied, as far as I am aware but my published diary may show this to be different, by Jarvis for any reason let alone a contract. As far as Potters Bar is concerned, as you know the Secretary of State has still to make a decision as to whether there will be a joint public inquiry on Potters Bar and that decision will be made later this year. I would not want to go into too many details there but I have never been approached by a private sector company ever lobbying me for a specific company. To add to that, the contract that you are referring to would actually have been let by Railtrack, now Network Rail, rather than by the Government. The Government does not actually let out contracts for maintenance or renewals on the railway network. Ministers do not take those decisions.

  Q836  Kelvin Hopkins: I asked a question of the previous Prime Minister about Jarvis some time ago, I understand Cabinet was panicking at the time and desperate to keep Jarvis alive and fed them lots of contracts, but that is another story. What you say, and what has been said today, suggests that the real power, influence and decisions take place in a rather mysterious way not at your level. Things happen which seem to have been influenced by the private sector and yet for some reason we do not know how it happened. At your level I am sure everything is straight. It is rather like having a respectable front, but behind that there is the "walk in the park". Someone, somewhere is actually influencing decisions above or away from your level.

  Mr Harris: If you forgive me that is an unnecessarily cynical approach to take to what is a very robust and effective system. Let us go back to franchising. When the short-listed companies are actually in the process of having their bids assessed the key officials who are making the assessment on whatever grounds, deliverability of rolling stock programmes or whatever, do not even know which companies they are assessing because they are all given code names at that stage. They will be called Tom, Dick and Harry, and Tom may have advantages in this area and Dick in others. Actually in a paradoxical way the process has to be less than transparent in order to make sure it is an absolutely level playing field and no company has any advantage over the other. In that respect we can have absolute confidence that it is not lobbying that has resulted in a particular contract being awarded but actual deliverability and the assessment of their bid.

  Q837  Kelvin Hopkins: I will move on. There was also the mysterious reason why Midland Mainline had its franchise taken away when it was apparently the best of the franchisees.

  Mr Harris: Midland Mainline came to the end of their franchise and there was a new franchise issued and another company put in a better bid.

  Q838  Kelvin Hopkins: You will remember that I am a member of the Council Housing Group in the House and we recently had a meeting in this building. I had a very strong feeling, and forgive me for saying this, that we were something of an annoyance, an irrelevance, a bit irritating and we were not going to be taken seriously.

  Mr Wright: Absolutely not. I completely disagree with that.

  Q839  Kelvin Hopkins: Not just on this front but on a whole range of fronts there is a very strong feeling that there are outsiders and insiders, insiders who have pull with government and outsiders who do not. Consultants—the "consultocracy"—big business lobbyists, have much more pull than backbench MPs, even when there is a substantial body of parliamentary support for a particular view.

  Mr Wright: Let me talk in general and then talk about that specifically. I go back to one of the earliest points I made to the Committee today which was that I will always agree to meet with MPs. With particular regard to that meeting which was organised by Austin Mitchell, that came in response to a Report and Third Reading of the Housing and Regeneration Bill and certainly in terms of the role of local authorities in the delivery of new houses it is something I am particularly interested in. It is something where we are trying to remove some disincentives and barriers so that local authorities do play a greater role and it is something I am interested in. Maybe it was my presentational skills but the idea that you are an irrelevance is absolutely completely wide of the mark, certainly not.

1   Association of Train Operating Companies Back

2   Train Operating Company Back

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