CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 1762-ii

HOUSE OF COMMONS

ORAL EVIDENCE

TAKEN BEFORE THE

PUBLIC ADMINISTRATION COMMITTEE

BUSINESS APPOINTMENT RULES

TUESDAY 20 MARCH 2012

ADMIRAL LORD WEST OF SPITHEAD GCB, JOHN SUFFOLK and SIR HUGH TAYLOR KCB

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Public Administration Committee

on Tuesday 20 March 2012

Members present:

Mr Bernard Jenkin (Chair)

Alun Cairns

Paul Flynn

Robert Halfon

David Heyes

Kelvin Hopkins

Greg Mulholland

Priti Patel

Lindsay Roy

Examination of Witness

Witness: Admiral Lord West of Spithead GCB gave evidence.

Q156 Chair: Order. Thank you for coming to take part in this witness session on the workings of the Advisory Committee on Business Appointments. Please identify yourself for the record.

Admiral Lord West: I am Admiral Lord West of Spithead.

Q157 Chair: When did you first become aware that the time spent in public office, either in the armed forces or indeed in government, could have implications for your future career options?

Admiral Lord West: I have to say that I did not really focus on it until the last few months of my time in the Navy, but I was aware that there was such a committee in existence, although I had never really paid much attention to it or thought much about it. In the last five or six months or so of my time in the Navy, I became more aware of it. I was in fact sent some stuff about applying for other jobs by the Naval Secretary, and then I got some stuff from the Ministry of Defence itself, so I became more and more aware of what was actually required.

Q158 Chair: You were officially informed by your employer of the constraints.

Admiral Lord West: I was informed by the Ministry of Defence, yes.

Q159 Chair: That there would be constraints on what you could do.

Admiral Lord West: Yes. They did not really make it clear what the constraints were. All that was said was that you would have to go through a process before you actually took up an appointment. It was not until I had left the Navy that I thought about it, because I had nothing in mind to do when I left. I have to make it clear, it is slightly extraordinary that as a First Sea Lord you are always on the active list, but that was my last naval job. When I finished as First Sea Lord-you now go on to get a pension but still remain on the active list-I started to get a pension and went on the active list, and it was only then that I started to think, "Gosh, what do I want to do now?" Then I started looking into what this meant, and I realised that there were considerable constraints on one, in terms of getting another job.

Q160 Chair: Did that have a detrimental effect on your options? Did you feel that your freedom was being curtailed?

Admiral Lord West: I don’t think it did really, probably because I did not have a burning desire to go and do anything that would have made it difficult for me with the rules that were there. I don’t think it did.

The other thing that I should say is that, having done that, I did get a number of jobs and things, and was working all over the place-in the City, in banks, in QinetiQ and so on, and speaking and things like that-and then I was pulled back into government, on the third attempt by the then Prime Minister who got me back in, and I had to give up everything. The reason that I was brought back into government was, he told me, my huge depth of knowledge about security-I think I had a reasonable knowledge about it-but what I then found amusing, three years later when I finished as a Minister, was being told that I had to go through the same process again because of all this depth of knowledge on security that I had gained when I was a Minister which made me much more marketable outside and one had to get a fair balance there. So I found that slightly amusing. I have been through the process twice, in other words.

Q161 Chair: Which is why I think you could help us a great deal in terms of how you found the process. Can you give us a flavour of how ACoBA interacted with you and whether you felt that it was constructive and efficient or tiresome and inefficient?

Admiral Lord West: The first thing to say is that everyone, without exception, was exceptionally polite-people were polite and nice to deal with. Having finished as First Sea Lord, one appointment that I was going for-I did not even try to go into it until I had been out for about six months-was with a firm called QinetiQ. That was the only area of the defence industry that I got involved in, otherwise everything that I was involved in had nothing to do with defence. I found the process slightly long-winded. I said that I needed to get there quickly, because a job had come up, but it took rather a long time.

Q162 Chair: How long?

Admiral Lord West: For the final approvals, it took probably about three and a half months, or something like that. I did sort of feel as well that, rather than ACoBA conducting a service for me as well as for the nation, I was having to prove myself to it all the time, and I found that a bit irksome, to be quite honest. I thought, "We are in a free market here, I am a marketable good and I have learnt certain things." If I was a surgeon who had trained in the national health service, I would be pretty irked to be told, "Hang on, you have got to check very carefully before you can work as a surgeon in this private hospital, and in fact we would much prefer if you were a welder." I always thought there was that sort of feel about it at times.

Q163 Chair: They might invite you to desist from being a surgeon until you had forgotten how to cut people up.

Admiral Lord West: There was a strand of that. I absolutely understand that there has to be something, and you cannot possibly go to some places where you have knowledge. For example, I would clearly never talk about classified information. I have been Chief of Defence Intelligence and probably had more clearances than almost anyone in the country, so you clearly do not talk about that, and you clearly would not ever talk about anything commercially confidential. But all the other knowledge that you have got, that is a very valuable commodity, which is of use to the nation and of use even if you are not serving in the MOD, but in defence industries or wherever-that is extremely valuable and useful.

Q164 Chair: I suspect that QinetiQ understood the process that you had to go through, but what about the organisations less connected with government, such as banks and so on?

Admiral Lord West: To be fair, the process was quicker with them. They were just surprised that there was this process, because I had been gone for some time from my job. They were surprised that I was still having to get a tick in the box to go and do something.

Q165 Chair: Was there any qualitative difference in how ACoBA dealt with you as a former military officer compared with you as a former Minister? Or was it the same?

Admiral Lord West: I think, probably, that I would say it was the same. It was probably the same, although when I finished as a Minister I went into a bank and things like that, so I think it was much easier for ACoBA to deal with that.

Q166 Alun Cairns: Lord West, when you applied to ACoBA, were the criteria on which the decision would be made clear to you?

Admiral Lord West: No.

Q167 Alun Cairns: You talked earlier about being aware of constraints. Did you even know the rules when you were appointed to your last role?

Admiral Lord West: I do not think that they were really clear. I did not refresh myself on that before this Committee hearing, I’m afraid, and I apologise for that, but I was sent a lot of stuff and I am sure that there were rules written in there. I was not clear, however, on what basis they were making their judgment about whether I would do it or not. I imagine that it related to things such as whether I was privy to masses of commercial-in-confidence material, or whether I had been dealing in detail with QinetiQ-I pick that as it is an easy example. I assumed it was that sort of thing, but it was not really clear to me.

Q168 Alun Cairns: Do you think that the criteria that they would use-assuming that they had detailed criteria-were measurable and pretty hard and fast, or were they subjective? Was there significant leeway for them to make a judgment about one person in one way, but to come out with a different decision about someone else on another occasion, using the same criteria?

Admiral Lord West: My feeling was that they were slightly subjective. By that time, I looked with interest at people taking up appointments, and it struck me as amazing that some people seemed to bounce seamlessly from within the Ministry and straight into a major defence firm within a matter of weeks. I never particularly wanted to work for a major defence firm because I always wanted to be able to speak freely. I have realised that senior officers in major defence firms cannot speak freely, because otherwise they are out of that firm, and that stops them from talking about things. I went into QinetiQ, but at that stage there were no major decisions to be made and I realised after a while that I had to be careful as I would much rather have the freedom to speak with my knowledge of defence on a broader basis than be constrained by it. There are other things that constrain you.

Q169 Alun Cairns: So as the recommendation became clearer, did a dialogue take place? If it did, did you think that the committee was influenceable and that if you underlined certain points, given the subjectivity, they would be more favourable or less favourable?

Admiral Lord West: I got asked a couple of points for clarification-I can’t remember exactly what they were. To be honest, I never really felt that I was in a dialogue with the committee. I felt that I was in a dialogue with an official who was then talking to the committee. The committee then talked and told the official something. That is how I felt that it was working.

Q170 Alun Cairns: Okay, so the answer to the question about the committee being influenceable is that it was not-?

Admiral Lord West: In my case, I did not feel that I was able to influence the committee, but when I looked at some appointments, I wondered if it was being influenced. Let us put it like that.

Q171 Alun Cairns: When you had your final recommendation, did the committee explain the basis for that decision?

Admiral Lord West: No.

Q172 Lindsay Roy: Lord West, were there any other surprises?

Admiral Lord West: No, I don’t think there were. I am trying to think back. Generally, I went and did roughly the things that I was hoping to do. I was not cut off and not allowed to do something, but the delay factor was not very nice. I found the issue of lobbying interesting. Again, I had never thought of that until I was out. The rules say that you are not allowed to lobby for two years or something, and I was not quite sure of the definition of lobbying.

Q173 Chair: Did they give you a definition of lobbying?

Admiral Lord West: There was a paragraph-a footnote on one sheet of paper about lobbying, influencing and dealing with Ministers. I also found that a bit of an insult to people who are serving as Ministers and in the Ministry of Defence, and an insult to me or whoever was doing it. I don’t see why you should not be able to talk to Ministers or civil servants. I would like to think that if someone who I knew came to talk to me, that would have no effect on the decision. Having someone who knows who should be talked to and so on is a useful way of making things happen, or so it seems to me. Those are the lessons you learn. It is rather as I found when I went into business. Business men had skills that they had learned over years, although actually some were as incompetent as some of the people I met in the military and the civil service. They had the same sort of ability. The skills they had, they had built up over years; the skills that I and others had from the military had been built up over many years within those organisations.

Q174 Lindsay Roy: Would it be a fair assessment to say that at times you felt, in terms of the criteria, that you were swimming through cotton wool?

Admiral Lord West: In terms of dealing with them?

Lindsay Roy: Yes.

Admiral Lord West: As was said, I was not clear about the full criteria, and I did not feel that I was able to talk to someone about what exactly it means when you talk about lobbying. Many of my friends are military officers who are still serving, and many of them are senior civil servants, and many are now in the Government. I know that the Government have changed, but I like to think that they are still friends. I know them. What exactly does that mean? Should I not talk to someone and say, "I think this decision is going round in circles," or that the decision about planes for aircraft carriers-I would say this, as an admiral-seems a bit batty to me? Why should I not say that, and talk to people about it? Clearly, you don’t say, "Remember, I took your daughter riding lots of time, so perhaps you could make sure this contract goes through." One understands that, and that must surely be breaking the law in some other way.

Q175 Kelvin Hopkins: Before I ask my formal question, you are obviously a man of great integrity and probity, and one who wants to serve our country-that is evident from everything you say and do-but other people may be interested just in making money, and that is perhaps where the difference lies. That is just a thought.

Did you feel that members of ACoBA, when considering your application, adequately understood your roles in the Navy, and subsequently in Government, and the nature of the appointments you proposed to take up?

Admiral Lord West: I think they probably did. I think there was an ex-second permanent under-secretary from the MOD and one ex-chief on the board, so I think they would have understood my role as First Sea Lord, and what I had done as commander-in-chief, pretty well. I had to describe what my job was going to be in QinetiQ, and what it was planned I should do, so I think they probably did.

Q176 Kelvin Hopkins: You have anticipated my supplementary question. Was the presence of an ACoBA member with experience of service in the armed forces important to you?

Admiral Lord West: I think it is useful, because they then understand exactly what you have done. Otherwise, it is quite difficult. I found that when talking to people about jobs. Some people have a lack of understanding about what we do in the military. I do a lot on leadership, for example. I did before, and I do now-seminars, talks and all sorts of stuff on leadership. There is a feeling that leadership in the services is shouting loudly at someone. They don’t really understand that it is rather more complex, and that we have a very good way of doing that sort of thing.

Kelvin Hopkins: That is the way the Whips sometimes speak to us. Sorry, Chair.

Q177 Paul Flynn: Did you have any connection with the setting up of QinetiQ, or work with any of the other firms with which you were subsequently involved, when you were serving in the Royal Navy?

Admiral Lord West: That was one of the questions I was asked. The answer is that I didn’t really.

Q178 Chair: Didn’t really?

Admiral Lord West: Well no, because I didn’t set it up, but I-

Q179 Chair: What does "really" mean?

Admiral Lord West: That is what I was about to explain. I sat on a board that was chaired by the permanent under-secretary, and I was there as Chief of Defence Intelligence. It was basically the senior civil servants within the MOD, one of whom was the chap who set up QinetiQ from DERA. I was aware that that was being done and had been done, but I was not involved. When they asked me whether I was involved in it, I thought, "Hang on, I did go to meetings where this man was," but I did not get involved in the mechanics of setting it up at all.

Q180 Paul Flynn: I do not know whether you agree, but when QinetiQ was set up, the people who established it made fortunes by taking assets that belonged to the taxpayer at a bargain rate. Is that a fair assessment, in your view? They became very rich, and the amounts they paid for the public assets were minute, in retrospect.

Admiral Lord West: Shall I say "allegedly"? What I do remember is that a number of us were unhappy that a massive amount of Government intellectual property was suddenly being privatised.

Q181 Paul Flynn: I mean, it was a rip-off. I know you are reluctant to say it; but I can say it. If you felt that way about it, why on earth did you go and work for them?

Admiral Lord West: Because it was important that it worked and ran properly. That was important. It was running all of the ranges for our military. It had some of our best scientists. The only bit that wasn’t there was the Defence Science and Technology Laboratory. So an awful lot of really important stuff was being done by them, and it was important that it was run as efficiently and well as possible.

Q182 Paul Flynn: There was no thought in your mind, when you had this slight involvement in the setting up of QinetiQ-or you were there watching it, and involved-of having a job with them later on?

Admiral Lord West: No, none at all.

Q183 Paul Flynn: Have you any financial interest at the moment in the Type 45 destroyers and the Sea Vipers?

Admiral Lord West: No.

Q184 Paul Flynn: None whatsoever?

Admiral Lord West: No.

Paul Flynn: Okay.

Admiral Lord West: As I say, I tried very hard; after going into QinetiQ, and being there for that short period, when I then went into government, I thought, "Well, I don’t want to get involved with big defence firms, because I’ve noticed that the senior officers who are, are unable to speak on things"; and I thought it was too important that one was able to speak openly on all these issues, like the Type 45 destroyer and things that I think are wrong or right within defence.

Q185 Paul Flynn: You carry great respect and authority, because of your service, in many ways. Do you think it is reasonable to say things like you wanted to see the Daring class and the Type 45s show their potential in the Gulf region? You said it is highly capable and you were looking forward to that happening in the Gulf. Isn’t this a comment that should not be made by someone with your reputation, as it would seem to be inciting war against Iran?

Admiral Lord West: No; I think I am very clear on the record, within the Lords. If you look up Hansard-

Paul Flynn: I have the quote here.

Admiral Lord West-I said that I think the elephant in the room, that we are sleepwalking towards, is a war with Iran; and I think that would be a terrible mistake. The discussion that people are having is "Isn’t a short attack now on the nuclear sites more valuable than allowing a long thing-

Chair: Forgive me for interrupting-

Admiral Lord West: Can I just finish? I very clearly said I thought that would be a very bad thing to do; but it is not quite this, is it, this-

Q186 Paul Flynn: You said you would like Type 45s to show their potential in the region.

Admiral Lord West: Well, I would, because I think what they will do is they will show they can do counter-piracy, they will show they can show British presence; they will show their full capability. I think that is a good thing to do.

Q187 Paul Flynn: And this is not inciting warfare.

Admiral Lord West: Absolutely not.

Chair: This has got nothing to do with ACoBA.

Paul Flynn: It is interesting, though.

Admiral Lord West: As I say, I very clearly said that I think an attack on Iran would be a very silly thing.

Chair: Any more questions on ACoBA, Mr Flynn?

Paul Flynn: No.

Q188 Priti Patel: In light of your experience and engagement with ACoBA, what role did you have as First Sea Lord in advising others in the Royal Navy on the suitability of roles after leaving the service-if any?

Admiral Lord West: I didn’t, really. What I did do was, there was a naval officer’s post-a captain’s post-where he specifically advised officers when they were leaving, and he had connections within industry and commerce, and he used to help people get into jobs; and that job was going to be axed. I had a certain amount of lobbying from people within the Navy-or ex-Navy; people who had used him-saying he was so valuable. I looked into how valuable he had been, and how many he had been successful with, and I said "Right, we’re going to keep him, and we’ll keep paying for this chap to do this." So that was it. It was really that he had been very good at doing that. He was based in London; he went out, he knew everyone in the City, and all these sorts of things, and it was very useful for giving people this opportunity.

And then we have charitable things like the White Ensign Association, which does a lot of stuff for people leaving; and then there is the tri-service organisation, for people getting resettlement, as well.

Q189 Priti Patel: Presumably that is really through informal networks that would not necessarily be subject to the ACoBA process.

Admiral Lord West: That is correct, and it was mainly for people below the rank of two-star-that’s the thing; but the moment, of course, you are above two-star, you have to go through that process, even if the job has been found in an informal way.

One of the things I seem to remember you had to put on the form was "How did you find out about this job?" The QinetiQ one, for example, I only found out about because I was head-hunted for it, effectively; and one was in two minds whether to take it. What I did find, on leaving the service-Government service-is you get paid wheelbarrows full of cash by all the people who employ you. It is unbelievable, and rather fun-but I think it is much worse now. I think it is a bit tighter than it was then.

Q190 Priti Patel: There are a couple of things here that are quite striking. In your comments about ACoBA, you talked about the process being long-winded, and then there was your comment that you felt that some of the decision-making was subjective. When you and perhaps other senior military colleagues were applying for particular roles, could you ever go down the route of going to ACoBA for informal advice, or was it very structured? Was there a process, and criteria for engagement that you had to stick with when talking to it?

Admiral Lord West: I did not feel that I was having an engagement with it, really. Perhaps that was my fault; I am not absolutely sure. Perhaps one could end up having a dialogue with it, but I did not feel that one was able to. As I say, I felt I was working through its outer office. To be quite honest, the only time I thought that it would be nice to have a quick chat with it was to do with the QinetiQ thing. Having been a Minister, I did find it rich that I had to explain that I knew a lot about security. I was going to the job because I knew a lot about security. Well, I did not learn that while I was in Government; I learned more, obviously, because all of us learn more, but I knew quite a lot about it anyway.

I had been taken from industry and stuck there to do a GOAT job for Government, and then I was suddenly having to be checked out before I could take a job. If it was just purely to check that there were no contracts and things with the firm that I was going to, I could understand that, but I do not think that one ever felt that. In a way, I would almost rather go and sit with the group of people who had formed the panel, so that they could find out things in the same way that you are-by asking me various questions. I would almost prefer to sit with them and talk it through, rather than filling out a form, sending it in, and having a question come back. Time goes by, and you are not sure what they are discussing about it. I would certainly prefer that.

Q191 Priti Patel: Finally, you mentioned that there was not really a feedback process or mechanism. They did not have that dialogue with you. What, in your view, could change on that front? From what you are saying, the direction of travel seems very one-way. Everything is correspondence-based, and it is not particularly dialogue-oriented.

Admiral Lord West: I suppose if you are looking for lots of appointments, it would be very useful, when the first ones of these were coming in, to hear, "In our discussion within the committee, we were concerned that you had been involved in this sort of area of procurement, and then we looked into it, and actually you hadn’t dealt with any of these particular firms." It gives you a flavour of the sorts of things that are of concern. As I say, I would quite like to have the lobbying thing explained a little bit more clearly-what it actually means.

Q192 Chair: So you think that you should appear in front of the committee and have a conversation?

Admiral Lord West: That sounds too awful, but it would be quite nice to go and meet in the bar, and have a drink and chat with them all. Yes, in a way, so that you feel that you have engaged with them. It sounds awful if you formally have to go and sit in front of the committee each time.

Q193 Chair: It is a bit of a tick-box culture?

Admiral Lord West: Yes. I think it would be nice to have a little bit more dialogue, probably.

Q194 Paul Flynn: Did you actually meet the committee at all?

Admiral Lord West: No, and presumably one is not allowed to, in case one is doing lobbying. That is the problem.

Chair: It depends who is buying the drinks.

Q195 Robert Halfon: May I ask you a general question? Do you think it is a good idea for the Government to have GOATs, as you were described as one?

Admiral Lord West: That is difficult. Probably it is good, if Prime Ministers, of whatever Government, feel that there is a job where they need some real in-depth knowledge-I have to say that part of what I had was an in-depth ability to lobby, actually. I know all the American intelligence world really well. Intelligence is an area with rolled-up trouser legs and funny handshakes, so if you know them all, this really allows you to do things. I think in that case, for certain jobs, it probably is a good thing for a Prime Minister to be able to say, "Right, I want to pull this person in."

In the period when I was Security Minister, there was a lot going on, and a lot of things that we resolved and put on track. I am talking about things like the national security strategy; there had never been one before. There was the cyber security strategy; again, there had never been one before. There had been no one to pull it all together. There were things like security of crowded places. It was the first time we had CBRN protection, and all those things. An awful lot of things that we managed to get moving would have been very difficult for somebody without knowledge of that broad area. I think that it probably is right, but I do not think you want to go over the top and have too many of them.

Q196 Robert Halfon: Do you think it works in our political system? Although you had a distinguished career and served, a number of the GOATs faced considerable controversy for saying the wrong thing. They were not part of the political culture and had not come up through a party. Do you think it works? Are we moving to an American-type system, or should we continue? A lot of the GOATs faced enormous difficulties. Should the majority of it still be under the traditional system?

Admiral Lord West: As I say, I do not think you should have too many GOATs. You talk about saying the wrong thing; I am afraid that I quite regularly say the wrong thing, but I think there is value in having people with specific knowledge if specific appointments should be made. For example, there is a debate at the moment on whether there should be a Minister between the Prime Minister and the NSC. I think there should be, but there are good arguments both ways. If a Minister were there, I believe he should be someone like a GOAT, because you need someone who does not have political ambition. That position could become too powerful if it were someone with political ambition because of where he is placed. For specific, niche things, it is valuable. The other thing I learned is this: it is very easy to laugh at politicians, but politicians learn a huge amount about being a politician, and it is not easy. That is a very useful skill, and you need politicians in Government because it is political. However, you cannot have too many GOATs.

Q197 Robert Halfon: Does the ACoBA process discourage people from becoming GOATs?

Admiral Lord West: Because I then had to go outside again?

Robert Halfon: Because you then had to go outside and go through ACoBA.

Admiral Lord West: All I think is that we might need to look at the system and say, "Are there some tweaks we can do to this?". It seems ludicrous that, if you are pulled in because of specific skills, when you want to go out again they treat you as if those skills are things that they taught you. That seems a bit bonkers.

Q198 David Heyes: When you were a GOAT-it is a clumsy word, isn’t it?-were you aware, having been through the ACoBA process for the first time because of your military service, that other members of the armed forces had excused themselves from applying to ACoBA on some sort of legal basis? Did you know about that?

Admiral Lord West: No, I did not realise that.

Q199 David Heyes: It is the case, I promise you. It went on for several years. You went through the process, but people who followed on from you excused themselves. Now that you know about it, would you be concerned about it?

Admiral Lord West: Well, I think if there is a process, it should apply to everyone. Somebody-I think it was Mr Hopkins-quite rightly said that some people are driven by other things. I suppose you have to have a process in place that allows you to spot that. I am not sure whether this process does that exactly, but I think you probably need it. There are occasions when you look at jobs where someone has moved seamlessly from a very senior appointment straight into a very major firm that has been involved in a huge programme with them, and you have to have doubts about that. Therefore, I think you do need a process to do that.

Q200 David Heyes: So it matters that for several years some people were skipping the process?

Admiral Lord West: I think that is quite worrying. It is fine if it was being done by people who are absolutely squeaky clean and who object to having to go through this thing, but you cannot guarantee that, can you?

David Heyes: It has been corrected now.

Chair: We need to move on.

Q201 David Heyes: We also know that quite a number of people failed to seek ACoBA’s permission, applied retrospectively and were subsequently cleared. Clearly, that is not something that you did. You were quite fastidious in your approach to this. Why were you so fastidious when you perhaps did not need to be?

Admiral Lord West: It is a bit pathetic, isn’t it? I thought that that was the rules, so I did it. I will obviously have to become more independently-minded. This is no good at all.

Q202 Greg Mulholland: May I ask you, Lord West, looking at this from another perspective, whether you would have taken up your current role with Key Technologies, which has clear interests in the defence sector, if the ACoBA process was not there? You clearly have followed the process, which is there to provide public assurance that no impropriety is involved. Would you have felt less comfortable taking that position if there was not a process to go through?

Admiral Lord West: That is a good question, because the media can make things look very bad. It gives you a safety net in that sense. I think that, yes, probably there is something there. I did not think of it in those terms, but it is right and useful to have that, because the media will always play things whichever way they want to, for understandable reasons, and try to find things out as well.

Greg Mulholland: As indeed they have, understandably, with those who have made retrospective applications, who did not bother with the process in the past.

Q203 Chair: You mentioned that you did not feel constrained by the conditions imposed on you by ACoBA, but do you feel that the conditions they oppose are reasonable? It is necessary, isn’t it?

Admiral Lord West: I think that there needs to be something in place. I mentioned one bit that I find slightly strange, which is that, having gone in because I have a certain skills set, it is extraordinary that they seem to think-

The other thing is that there seems to be an underlying feeling with some people that it is wrong-I will use the example of the military, because I know it well-that a military person should go into a defence industry. It seems to me to make a lot of sense that those skills and everything that they have learned should be used in the defence industry. I have no shame about our defence-

Q204 Chair: So you do not think that it is morally questionable that someone should capitalise on the skills and knowledge that they have gained at the expense of the public sector, when working for the public sector, by going on to profit from that in the private sector? That is okay, then.

Admiral Lord West: I do not think that it is at all. The way I would look on it is that one is given, as I discovered when outside, quite constrained amounts of money, as well as giving one’s service and duty and everything, for many, many years. Yes, you have picked things up while that is going on, but you would in any endeavour where you are doing that. I think that it is absolutely right that you should be able to use that skill set in a free market.

One of the things that I found interesting-I did not mention this-was that one of the other things I was told was, "We are going now to ask BAE Systems, Thales, someone else and someone else if they are happy that you should go and join QinetiQ." I thought, "What the hell has got to do with them?" If they want to employ me, they could offer me more. I was beginning to learn about this commercial world. If they want me, they can pay me more. Why should they be asked about me working for QinetiQ? I found it slightly strange. If you think of America, for example, it is absolutely accepted that military people will be deeply in all their defence industries. You can surely give better advice to those defence organisations and make and shape them in the right way if you have the skills and the knowledge from where you have come from.

Q205 Chair: The scale of waste and, one might even say, corruption in their defence programmes dwarfs anything that occurs in our system.

Admiral Lord West: I do not know whether that is to do with the sheer scale of their programmes. I know that there was the $274 hammer, or whatever it was that was quoted. That is a part of the factor. You are quite right: British procurement, although there is an awful lot that can be done to make it better, is not bad in comparison with many places.

Q206 Chair: You feel that it is a clean system and that the public need have no worries; there are no conflicts of interest where people are exploiting their position unreasonably?

Admiral Lord West: Are we talking about the system that we have with this committee?

Q207 Chair: Just generally.

Admiral Lord West: Generally, I do not see why someone should not step from-

Q208 Chair: Sorry, my question is a bit more specific. There is a lot of speculation in the newspapers about people taking contacts and commercial information out of the Ministry of Defence into defence companies and that the relationship is too cosy and that we need tighter rules on this to provide public confidence that there is not an abuse of this information for personal gain. Do you share that view?

Admiral Lord West: I think it is absolutely right that we should come down like a ton of bricks on people who are using a position that they have in the military to feather their own nest for the future with a firm. If that is happening, then that is something that should, absolutely, be stamped on.

Q209 Paul Flynn: May I give a case? Say the country wanted to order two aircraft carriers and the Minister involved took a decision between companies A, B, C and D but, when they retired or stood down as Minister, they were employed by the company that won the contract. In such a case, there could be suspicion, and that is what we are concerned about; we are not trying to stop people having comfortable sinecures and getting their haciendas in Spain when they retire. It is a question of whether their judgment is corrupted by the hope of retirement prospects when they take those key decisions.

Admiral Lord West: That is a terribly difficult thing to answer, isn’t it? What I hope is that they would take the decision on the basis of what is best for us in strategic, operational and cost terms. It would be a pretty loathsome person who chose it thinking, "Hmmm, in about five years I will have a nice job with Babcock"-that would be awful, wouldn’t it? And I do not quite know how you would deal with that-the only way that you could is to say that no one is ever to go and work for any firm that has had a major contract during their time, and that would be extraordinary.

Q210 Paul Flynn: That would remove the temptation, if that was the case, but the situation now is that there is no reason why someone should take that decision or should decide on the basis of future job prospects rather than of the public good. That is the position that we are in now and is why we need ACoBA. But there is still procurement, with huge cost overruns and huge losses, here and in the United States. Surely there is a case for saying that there should be some constraint. As a final question: are there occasions when you have taken decisions and been influenced to choose one company rather than another, and would you be inhibited if a company that had got a contract while you were a serving officer came along and offered you a job?

Admiral Lord West: I think that the answer is, if I were responsible for having ordered a huge major programme-worth hundreds of millions of pounds-I would feel constrained from going into that company later. Even though it had nothing to do with the decision, I would feel constrained.

Q211 Chair: Thank you very much indeed, Lord West. It has to be a brief session, but you have been extremely helpful to us and we are most grateful.

Admiral Lord West: Thank you.

Examination of Witnesses

Witnesses: John Suffolk and Sir Hugh Taylor KCB gave evidence.

Q212 Chair: Good afternoon. Would each of you identify yourselves for the record, please?

Sir Hugh Taylor: Yes. I am Hugh Taylor, currently chairman of Guy’s and St Thomas’ NHS Foundation Trust.

John Suffolk: I am John Suffolk, the global security officer for Huawei Technologies.

Q213 Chair: Will each of you describe what it is like being subject to ACoBA’s processes and rules?

Sir Hugh Taylor: I think I knew pretty well what to expect when I went through the process. I should say for the record that many, many years ago-more than I care to remember-I was secretary to the Advisory Committee on Business Appointments, when Lord Carlisle was its chairman and I was in the Cabinet Office. The existence of the rules and how they operate-although they have changed a bit over the years-has always been with me. Of course in my role as Permanent Secretary in the Department of Health, cases would come across my desk from time to time. I was very aware of what the process would be and I knew pretty well what to expect when I went through it.

Q214 Chair: So, you have a view about how well it worked in your case?

Sir Hugh Taylor: Well, it worked.

Q215 Chair: Cumbersome? Nimble?

Sir Hugh Taylor: I would not describe it as nimble. The process took just over a month, and in retrospect I would not complain about that. There was a little bit of pressure because I had accepted an appointment in principle, although obviously that was subject to the outcome of the process. Understandably enough, the trust that wanted to get on with it was pressing to know the outcome.

Q216 Chair: It was rather odd that you were working for the health service as Permanent Secretary, and then you were going to go and work for the health service. Was there really a conflict of interest to address?

Sir Hugh Taylor: I did not think that there was a specific conflict of interest. First, it was quite appropriate for the case to go through ACoBA-that is the rule-and I think that I had some insight into the sorts of considerations that the committee would want to bear in mind. Perhaps I should say for the record that, as members of the Committee will know, NHS foundation trusts are not in the line of accountability for the Secretary of State; they are public benefit organisations with no statutory accountability to the Secretary of State, and that was one of the points I made to ACoBA. The Department and its officers have no role in appointing chairs of foundation trusts. In practice, the Department of Health does not have business dealings in that sense with a trust such as Guy’s and St Thomas’. I did not think that there was any direct conflict of interest arising from the appointment, but it was obviously entirely right that the committee should consider it. It made its outcome known, and I accepted that.

Q217 Chair: Certainly, the retiring Permanent Secretary is quite a catch for Guy’s and St Thomas’.

Sir Hugh Taylor: Well, I do not think that you should rush to the assumption that foundation trusts across the country think that the Department of Health is the greatest thing since sliced bread, and to be honest, I do not think that my appointment was thought of in those terms. I think the fact that I knew about the NHS, having done a number of jobs in the Department that brought me into contact with it, and that I understood how the system works, was a starting point.

I live in Southwark, and have done for more than 30 years. One of the key criteria to be eligible to apply for the post-which was openly advertised-was to be a resident of Lambeth, Southwark, Lewisham, Wandsworth or Westminster. My commitment to the area was important to the trust, as was the fact that I was able to convince it that I knew enough about the governance of a large organisation-it is a big organisation that employs more than 12,000 people and turns over £1 billion a year-to offer something. I would not describe myself as a catch in the sense of having been Permanent Secretary of the Department, but clearly I had relevant experience.

John Suffolk: I joined the civil service in 2004, and I was made very aware of the Appointments Commission when I left. I was reminded of the Appointments Commission when I took up the Government CIO role in 2006, and I also knew broadly the criteria that the committee would use: procurements; advanced policy knowledge that may be of advantage to the organisation; or information about competitors, which may also be of advantage to the organisation you are joining. I went into this very much with my eyes open, and I was not surprised by the areas that the committee covered. I was, however, surprised that it took 20 weeks, and that there were big gaps of silence. If I had not chased the process, we would probably still be sitting here today, many months on, and waiting for a response.

But I have no difficulty with the process; it is exactly the right thing that we should be doing. Officials should be reviewed when they join the private sector. I came in from the private sector, so I was only a civil servant for seven years. But we do need to look at whether you were involved in procurements or if you have advance policy knowledge or knowledge on your competitors, because that is the right thing to do in my opinion.

Q218 Chair: I would like to emphasise that the evidence is that you were scrupulous in making sure that the process was followed, not least because of the potential controversy of your appointment to Huawei. Did they approach you or did you approach them?

John Suffolk: I approached them, Chairman.

Chair: You approached them.

John Suffolk: I approached them.

Q219 Chair: Presumably, the knowledge with which you approached them was acquired as a public servant.

John Suffolk: I approached probably 75 different organisations, Chairman, so it was just one of them. I knew that I was leaving Government well in advance of the election because I felt that five years in any one senior role in any organisation is more than enough. I am a great believer of renewal, and any new team coming in needs to renew its team. So I was planning well in advance in terms of my departure.

Q220 Chair: That is very interesting and I am sure that we will want to come back to that. Given the controversial nature of Huawei, it was reasonable that ACoBA should want to think very carefully and deeply about it. Indeed, it attached more conditions to your appointment than to most appointments.

John Suffolk: I would question that premise in terms of why is it controversial. There has been no information given to me from anybody in Government from any source that this was a controversial appointment, so I am not sure I would agree with you.

Chair: Accepted.

Q221 Priti Patel: Mr Suffolk, you have been very frank and you have said that you were fully aware and you went in with your eyes wide open when you joined Government but, obviously, you have a very distinguished career in the private sector. At that time when you were made aware, did you feel at any stage that moving from the private sector into the public sector could effectively, dare I say this, even limit your future career options?

John Suffolk: I am an optimist by nature; in the work that I do, which is transforming businesses, you have to be an optimist. My belief is that if you go in knowing broadly the rules and you live within those rules, you do not, generally speaking, come across organisations that set out to trip people up. Organisations-and I include the civil service in this-look to attract people from the private sector for the skills that they have, as Lord West was saying. That was my starting point. So, no, I did not think, "Actually, this could be difficult to leave." [Interruption.]

Chair: The bell is going. We will take a pause, adjourn the Committee for 10 minutes and resume immediately afterwards.

Sitting suspended for a Division in the House.

On resuming-

Chair: We will press on. Could you each say whether, when you first applied to ACoBA, the criteria that they were going to apply to you were made clear to you? [Interruption.] We have another Division; it is not going to be our lucky day.

Sitting suspended for a Division in the House.

On resuming-

Chair: I call Mr Heyes.

Q222 David Heyes: I think you have answered most of the question I was going to ask, which was about your understanding of the criteria. From what you have said already, I think you have a pretty clear idea on what they were. Was there any dialogue between either of you and ACoBA during the consideration, or did it feel like a one-way process?

Sir Hugh Taylor: There was a little bit of dialogue at the end. I was told about the in-principle decision, and told that I could, if I wanted to, meet some members of the committee to discuss it if I had any concerns. There was the opportunity for dialogue there.

Let me stress that I had absolutely no problem with the two-year lobbying ban-which has now become, I think, a standard feature for people at my level of the system-since, first, it is almost impossible to envisage circumstances in which the chair of Guy’s and St Thomas’s would go and lobby a Minister and, secondly, even if there were, I would not want to do so, because I have no desire to spend my life going cap in hand to Ministers or my former colleagues for stuff. Let me just be clear about that.

However, I got a two-year ban, and at the time that looked a bit longer than other people had had. I did react a bit to that and asked why, and I got a letter back. I began to get the feeling that they were pushing the normal ban out for two years. So there was some dialogue, but it was-

Q223 David Heyes: But you did not get any explanation of the basis on which they had made that two-year decision in your case.

Sir Hugh Taylor: Not very personalised, let me put it like that. To be perfectly honest, because I was not worried about it and it did not affect either my personal circumstances or the way I was going to approach the job, and I understand the reasons for conditions of that kind, it did not give me any particular problem.

Q224 David Heyes: What about you, Mr Suffolk?

John Suffolk: All my dealings were with a former colleague in the Cabinet Office. Like Hugh, I was offered, once I got the draft letter, the opportunity to have a conversation with the committee. I questioned the six months and the two years, because the letter provides no evidence of how they have drawn their conclusions, and therefore I have an outcome but I do not know what the inputs are; you do not see what the input is other than the input you put in there.

I asked whether the committee would change their mind if I came to see them-I was given eight hours’ notice-and whether they generally did, and the answer was no, so I did not see that there was much point in having a dialogue with the committee. Like Hugh, I had no difficulty with the two years, but what I have learned since I have left is that we seem to legislate for the 1% of people potentially getting something wrong.

What I have learned is I would like to speak to former colleagues because when I am looking for investment decisions around Europe, it would be quite good to have a conversation, which you are banned from doing for two years. It is actually easier for me to go and speak to a mainland European country than it is to go and speak to my own Government. That does not seem right, although I understand why that two-year perspective is in there.

Chair: We are going to have to be very swift.

Q225 Paul Flynn: You answered part of the question. What effect did the rules laid down have on you? It was a constraint, you just mentioned now, but in any other way was it a problem to you in the new job?

John Suffolk: No, not really. For mine, as I think the Chairman said, there seemed to be a long list, but it did not appear that long for me. There was the six-month ban, which for me was straightforward; the committee needs to understand that you are not paid when you are on the six-month ban.

The two-year lobbying was of no concern to me. Not recruiting staff from Government was not a concern to me. Then there was this paragraph stating that I needed to talk to members of the Security Service, which ended up being a coffee in Caffe Nero on Trafalgar square. No one knew what that was all about. To summarise, there were no issues from those conditions.

Q226 Paul Flynn: Did you have any contact with what Lord West described as the trouser leg, funny handshake brigade?

John Suffolk: Not as part of this process.

Q227 Paul Flynn: What about as part of any other process? Was it a factor in the 75 jobs that you applied for?

John Suffolk: No, it was not. Not at all.

Q228 Paul Flynn: You both say that you never saw the committee itself; you dealt with an intermediary who was a clerk, and that was it. You were informed by letter, and you never actually saw this distinguished body of people.

John Suffolk: That is correct.

Q229 Greg Mulholland: Do you have full confidence in the members of ACoBA, and do you think that they have demonstrated adequate knowledge of your roles in Government and of the roles that you were hoping to take up afterwards? Was the presence of a member with experience in the civil service important to you?

John Suffolk: From my perspective, I saw no evidence of knowledge of what I did in the civil service or the role I was taking up. When I took up the Government’s CIO role, I was scrupulously clear in terms of the three key rules, which were commercial contracts, competitor knowledge and advance policy knowledge, and I stood away from all those three areas. Therefore, to get a letter back with conditions that bore no resemblance to the inputs said to me that there was a disconnect between what I did and what I was going to do, and those recommendations.

Sir Hugh Taylor: To be honest, I think I do have confidence in ACoBA, in the sense that they have a very difficult job. They are trying to measure public perception, after all. They are not making very precise calculations about the risk of corruption in individual cases; they are, to some extent, taking a step back and asking, "How does this appointment look?"

I do not know the members of the committee in detail, but from what I have seen of them, they seem to be reasonably constituted for that purpose. So I think there is a direct trade between the degree of severity that they apply and the degree of precision that would then be required to follow through on their judgments. Being honest, do I think they really understood the relationship or non-relationship between the Department of Health and NHS foundation trusts? I suspect they did not, but how much that mattered in the real world is-

Q230 Chair: Are you saying that this is as much a window-dressing exercise as an exercise involving substance?

Sir Hugh Taylor: No, not at all. I am not saying that. What I am saying is that the issue of substance at hand is the risk of a loss of confidence on the part of the public in the conduct of Government Departments, from a fear that people might either be doing their jobs in such a way as to set up jobs for themselves afterwards or taking up jobs where they exploit their former contacts in Government. I think that is a perfectly legitimate aim and I think the committee is there to take a judgment on the perception of that.

What I am saying is that as you press these rules further, and particularly in circumstances in which the patterns of employment in the civil service are changing-with people being brought in and out of the civil service more quickly-it may be necessary for more precise judgments to be formed about the level of risk in each individual case. A reasonably broad-brush approach to waiting times and the lobbying ban works for most cases. I just have a slight question mark in my mind for the future as to whether something more precise might be needed. You asked me about my case. I have no complaints about my own individual case.

Q231 Greg Mulholland: I want briefly to follow up your comment about a disconnect, Mr Suffolk. Does that demonstrate that the members are not following consistent procedure, that the procedure is simply not adequate, that it is not communicated, so that you get a list of conditions without it being linked to your own circumstance, or is it a combination of those things?

John Suffolk: It really comes back to what Lord West said earlier. You fill in a form, and in certain parts of that form there is not much space to key in the information that you want to. You can answer the form in one of 20 different ways. It goes to an intermediary-in my instance, in the Cabinet Office. You have no idea what the conversation is between the intermediary and the committee.

The members of the committee do their thing; you are never quite sure what the tariff is, how long it will be, what information they are looking for and what their concerns are, because you get zero feedback on this stuff; and then you get a draft letter. Therefore, I sit here thinking that I have no idea whether their process is very regimented and whether they are doing what Hugh is looking at in terms of risk, external perception etc., because you get no feedback.

Sir Hugh Taylor: Could I add one rider to this? Obviously, that was John’s experience, but in the Department of Health, where the Department was putting cases through to ACoBA, I would see it as part of my job to ensure-well, first, there was a process for ensuring that people were made aware of the circumstances in which they had to apply for outside appointments.

I would certainly talk to colleagues who were thinking about taking up future appointments-first, about the process, and secondly, about what the potential tariff, to use John’s term, might be. This may be uneven across the civil service, but it was certainly the case that I had discussions with people who were thinking about leaving the Department of Health to take up outside appointments about the process and about the potential outcome in their case, knowing what I did about the view that ACoBA had taken on previous cases, details of which are published on its website-not just the cases in the Department of Health, but externally. I do think that is a proper role for Permanent Secretaries and others inside Government Departments.

Chair: Mr Hopkins. Let’s proceed as quickly as we can, please.

Q232 Kelvin Hopkins: Indeed. This is specifically to John Suffolk. You say on your blog that former Cabinet Office colleagues have criticised you for going through the ACoBA process because "they are concerned that others might now need to follow where in the past many have ignored it". Are you aware of particular individuals who have ignored the process?

John Suffolk: Absolutely so, yes.

Q233 Kelvin Hopkins: Interesting. Why do you think people ignore ACoBA?

John Suffolk: Because there is no follow-up action, generally speaking, from Departments to force them through the process. Since I have left, I have come across many former colleagues who, when I ask them whether they have been through the process, say, "Why would I need to go through the process?" The issue is that there is no follow-up of the process, and there is no publication of who has gone through it and who has not. From my perspective, those who go through it are worse off than those who do not. There is no incentive for someone to go through the process at this moment in time.

Q234 Kelvin Hopkins: Does that not suggest that it is rather less innocent than that, and that they are annoyed with you for going through the process?

John Suffolk: Some are.

Q235 Kelvin Hopkins: Because they do not want to be inspected?

John Suffolk: Absolutely. Some are annoyed, yes.

Q236 Kelvin Hopkins: So you suggest there should be some changes to the process?

John Suffolk: Absolutely.

Q237 Kelvin Hopkins: Any idea what those should be? Any specific suggestions for brokering change?

John Suffolk: I think we need to focus on areas where we think there is a risk or concern. I think to put everyone through the same process when the risk is not the same for everyone in the role they have done probably wastes a lot of the committee’s time, so I think that we must undertake a risk management process here. I have never believed that in life, if you have a process, you have a choice, in terms of whether you do it or not. If we are going to have a process, those for whom that process should be applicable should go through that process. We need to be more transparent in terms of what the areas of concern are, so that people know, when they join the civil service and when they leave it, the sort of criteria that they will be conditioned for-not just them as individuals, but any future employee as well, because it is important that we manage their expectations. I am a great believer in the necessity of a process. I just think we need to make some changes to make it faster and more transparent for people, and to make sure that where it should be adopted, it is adopted.

Q238 Kelvin Hopkins: One final question: would you have taken up your current post at Huawei if ACoBA had not been there to provide a degree of what we might call moral cover?

John Suffolk: Yes, I would.

Q239 Chair: Moving on, Sir Hugh, when you were permanent secretary, Departments, rather than ACoBA, were responsible for applying the business appointments rules to applications by civil servants at deputy director level and below. Did you fulfil that role as permanent secretary? Do you recall fulfilling that role?

Sir Hugh Taylor: To be a bit more explicit than that-my memory on this is going, so I might be wrong-it would depend on the circumstances. If individuals had specific procurement responsibilities, I think there might be circumstances in which they would still go to ACoBA. I certainly recall dealing with specific business appointments cases when I was in the Department, yes.

Q240 Chair: How were your employees made aware of that?

Sir Hugh Taylor: Anybody recruited into the Department is informed about the business appointments rules on appointment. Secondly, when the HR department is aware that someone is leaving the Department, they check to ensure that they have, if appropriate, gone through the business appointments process. There were sometimes occasions when they had to remind people that they needed to apply, and then the process was gone through.

Q241 Chair: A special adviser-would that have been a Cabinet Office responsibility to ensure that someone was informed?

Sir Hugh Taylor: No, I would have regarded that as my responsibility.

Q242 Priti Patel: Sir Hugh, on the point about business appointment rules, did you find it quite straightforward to apply the rules to applications by certain special advisers, for example?

Sir Hugh Taylor: Relatively. I think the principles involved are clear enough. It is, I think, unquestionably more difficult in cases where people are brought into the civil service because they have specific sector knowledge, and then leave again. In other words, they do not really have the prospects of a general civil service career, and they are not obvious candidates for jobs in other bits of the civil service, so they really need to go back into an area where they have sector-specific responsibilities. In the case of the NHS, for example, people come into the Department from the NHS, and really their only route out of the Department would be back into the NHS, or into a private sector role where their health sector experience was relevant.

In the case of special advisers, I think a judgment would be made about the particular job that they were going to, and clearly, particularly during a period when Ministers for whom they had been working were still involved in the Department, you would want to take and exercise particular care over that. The final decision in such cases rested, I think, with ACoBA and not with me, but I would be consulted.

Q243 Priti Patel: Sure. Can I also ask a question I asked Lord West? We have heard a lot about the engagement or lack of engagement-it is all paper-orientated and not much dialogue-but did you at any time seek any informal advice from ACoBA when applying for roles?

Sir Hugh Taylor: Absolutely. Certainly I and my office would seek informal advice from the Cabinet Office in the first instance, and therefore indirectly of ACoBA, about how we might approach a particular application. Without going into individual cases, there were one or two difficult ones that I handled while I was there, and certainly I would take informal advice from ACoBA-from the Cabinet Office-at an early stage. To be honest, I found that helpful.

I want to stress that I think the rules work best if there is proactive management of them from inside the Department. Although I am certainly not challenging the evidence that has been given by John and others that people simply ignored the rules, if that had happened to my knowledge when I was Permanent Secretary of the Department, I would have got straight on the phone, first to that individual and secondly potentially to the company that was employing them, to find out what the hell was going on.

Chair: Mr Hopkins, can you be very quick?

Q244 Kelvin Hopkins: There is just one very important question that I would like to ask if I may, Chair. Health is regarded as a high-risk industry and there is perhaps more concern-you have said this yourself-about health than about other sectors, particularly at present. As Permanent Secretary, you obviously monitored these carefully. You said that.

I made a song and dance about a particular instance, when a man who had been employed by the US private health care sector, then worked for Amey securing PFI contracts and then, astonishingly, went into the Department of Health as an industrial director to lever PFI contracts out to the private sector. That looked amazing to me. He stayed there for a couple of years and then went off, but I made much of this during meetings in the previous Parliament.

I do not know if that was on your watch. I do not know if it came across your radar, but that instance was astonishing. It had the flavour of political pressure from Downing street; I do not know if that was the case.

Sir Hugh Taylor: I do not remember the particular case that you are raising. These are difficult cases. People are brought in with specific skills and then go out again. It would be wrong to comment on a case that I either do not remember or was not involved in at the time, but the rules are clear and have to be applied. Certainly in the cases that I was involved in, I felt that the committee in general handled them effectively, but I do not pretend that it is always easy, or always easy to get the right balance in assessing the outcome.

Q245 Paul Flynn: Just before you took office in the Department of Health, there was a report by the Health Committee on the influence of the pharmaceutical industry. It came up with some worrying conclusions about how influence was used to buy favour, lobby, and put forward special pleadings. The job that you appear to be doing seems entirely innocuous, but other civil servants who might have gone on to work for the pharmaceutical industry surely present a far greater risk and need to be told that they should not lobby and use the knowledge that they have of the Department to enrich their new employers.

Sir Hugh Taylor: Clearly, anyone who had had dealings with the pharmaceutical industry in the Department of Health or-

Q246 Paul Flynn: Lord Warner, to cite a case.

Sir Hugh Taylor: His case went through the process, and it is entirely right that that should be the case. At civil servant level, I do not remember a single case of a civil servant leaving from the Department of Health to join a pharmaceutical company, but that is not to say that the situation might not arise. It is extremely important to ensure as far as possible that there is no perception that, while they are doing a job inside the Department of Health or anywhere else, people are lining themselves up for a good job with a commercial company afterwards. That is what the rules are all about. That aim is the right one, and, within their limitations-there have to be limitations, given civil liberties and all the rest of it-the rules work pretty well from that point of view.

Kelvin Hopkins: May I ask one very important question?

Chair: Very briefly, because I have one, too.

Q247 Kelvin Hopkins: It was known that Tony Blair entertained private health companies, consultancies and American health corporations in Downing street. It was very clear that he was softening them up and inviting them eventually to take part in some degree of privatisation of the health service. Was there any pressure from Downing street to be soft on those companies and, in a sense, to assist them in dismantling the health service?

Chair: That is a yes or no, because it is not really relevant to this inquiry.

Sir Hugh Taylor: The answer is no, as far as I am concerned.

Q248 Chair: Thank you for being brief. Sir Hugh, particularly in view of your experience as secretary of ACoBA, what would be your reaction if it were recommended that ACoBA be established on some kind of statutory footing? The evidence we have received today suggests that it should be more of a "wise person" approach-a more intelligent, less tick-boxy approach-but on the other hand, ACoBA does not really have the credibility in the eyes of many commentators to police anything on a truly independent, impartial basis. What is your reaction to that?

Sir Hugh Taylor: I find it very difficult to make a judgment. The balance is between the amount of resource and effort you want to put into patrolling this area, and your judgment of the level of risk and level of potential damage to the perception of public service. I am not sure that you get huge amounts of gain from doing it, but there has to be a case. It comes down to a judgment, in the end.

My own feeling is that you could keep on throwing money, resource and process at this, and there might be a risk that at the end you are still unsatisfied, as sometimes people are bound to be. There might be a perception on the part of people who have to go through the process that if they are going to come out at the end with some quite tough restrictions on what they can do afterwards, the process could be more transparent. That is not a feeling that I have had personally, but it might point that way.

To be candid, I do not feel terribly strongly one way or the other, but I think it is a matter of the level of genuine public concern about it, and whether you could get significant benefit from what would have to be, frankly, a more expensive process.

Q249 Chair: Mr Suffolk, any thoughts?

John Suffolk: I am always reticent to say, "Let’s have more legislation." I think we can change the process. The process’s aims and objectives are exactly right, but we need to limit the roles that we do and do not look at, which is a large number. In this instance, the process has to be more open and transparent. In essence, people need to know, when they come into the civil service, what the rules will be when they leave. That is not clear to many people.

Sir Hugh Taylor: May I make one final point? The most important safeguard in this area is not the ACoBA process but really good processes for monitoring procurement inside Departments. There should be no circumstances in which one individual could significantly sway a procurement decision one way or the other. Having good, transparent procurement processes is key.

Secondly, the greater the civil service’s transparency in terms of declarations of contacts with external organisations and so on, the better. Unquestionably, the improvement that has been made in declaring meetings and so on is a good thing. That is part of the safeguards. The real safeguards lie in ensuring that business is conducted properly in the civil service.

Chair: That is very helpful. Thank you very much. I am most grateful to both of you for coming along.