Political and Constitutional Reform CommitteeWritten evidence submitted by the Institute of Economic Affairs

Introduction

1. A statutory register of lobbyists is unnecessary, unhelpful and risks acting as a barrier to civic engagement in the political process.

2. The coalition seems unclear as to the precise problem it is trying to solve and therefore risks imposing an expensive burden on lobbyists (and others) for no obvious public gain.

3. In terms of transparency, the burden surely sits with elected representatives and public officials to properly report the nature and the content of the meetings they conduct as part of their ongoing business. Therefore, any possible gains from a statutory register could as easily be provided by appropriate protocols applying to those being lobbied rather than by those conducting the lobbying.

4. The consultation document (in section 3) makes plain that ministers are already obliged to report who they meet but this does not make it clear the interests which may be represented by a lobbyist. If this is the totality of the problem, then ministers, MPs and appropriate others should perhaps carry a greater, statutory obligation to report the nature and content of the meetings they conduct with lobbyists.

5. Nevertheless, the consultation document makes it plain that the coalition is committed to the introduction of a statutory register of lobbyists, so this response is written with that in mind. Notwithstanding the author’s view that a statutory register is unnecessary and problematic, this response limits itself to the scope of the register—and, in particular, why a narrow definition of lobbying is necessary in order to avoid a number of pitfalls which the consultation highlights as a concern.

Definition of Lobbying

6. The definition of a lobbyist is set out on page 11 of the document, the three point definition clearly includes certain activities and clearly excludes others, but leaves a substantial “grey area” for which classification is required.

7. Those caught by the definition clearly include those who work for public affairs agencies. They are paid for by third parties, are almost exclusively “for profit” enterprises and could be said to be the least transparent of lobbyists (in that a note of record that a minister met people from “Bloggs Communications” gives no indication of the interests represented by “Bloggs Communications”).

8. Individuals lobbying on their own behalf are clearly excluded—such that a constituent raising an issue at a constituency surgery is not caught by the definition.

9. This leaves a large number of companies, organisations, charities and unincorporated organisations possibly caught and possibly excluded by the definition.

A. Groups of citizens with an explicit policy interest

10. It seems an individual who lobbies their MP to protest about, for example, a new road that may be built in the constituency is not a lobbyist. However, as soon as two or more individuals in the constituency combine together and form the “Stop the Bypass” campaign, they may be categorised as lobbyists. This would be particularly the case if the group has an identified spokesperson who might be said to be representing a “third party client” (namely, other constituents who are opposed to the new road).

11. The reasons the members of the group have to oppose the bypass could be many and varied. Some people may be opposed to the compulsory purchases that would be required. Others may be worried about the effect on the natural habitat. Still others might have concerns about noise pollution. There is no basis to suppose that those who hold one set of objections are in anyway motivated by or persuaded of another set of objections. They are merely united in opposing the construction of the bypass itself.

12. The group may select from amongst their number a spokesperson or chairman in order to represent their combined opposition to the bypass. It could well be the case that this individual is opposed to the bypass for only one set of reasons, but agrees to represent all the reasons members of the group have raised against the new road. In such circumstances, it seems difficult to escape the conclusion that the spokesperson is “undertaking lobbying activities on behalf of a third party client”.

13. It would be sophistry to argue that the spokesperson is not acting on behalf of a third party client as he is actually a member of the group. Clearly, a local action group could be an umbrella body comprising various sub-groups, “Greens Against the Bypass”, “Local Business Against the Bypass” etc. In such a circumstance, the chief spokesperson of the umbrella group would clearly be acting for third party clients and it cannot possibly be the purpose of the statutory register to distinguish between citizens’ campaign groups and confederations of citizens’ campaign groups. The legislation therefore needs to be constructed to exclude all these sort of groups from the burden of registration and sanctions for failure to register unless there is to be a substantial chilling effect on civic activity.

B. Think tanks, national campaign groups etc

14. There are no strict definitional distinctions between the sort of local activist group outlined above and groups formed by citizens on a national scale to promulgate and promote certain policy interests.

15. In practice, nationally based groups are more likely to have paid staff and will tend to have higher turnovers than local campaigns, but this is a tendency not a certainty.

16. To limit the list of lobbyists to those remunerated in conducting their work would tend to capture many in think tanks and campaign groups, but would also leave open various substantial questions of interpretation and would almost certainly create easily exploitable loopholes.

17. For example, a national campaign group committed to saving the whale could employ all its staff through one corporate entity (“The Whale Saving Foundation”) but conduct all its lobbying through another (“Save the Whale”) and allow all staff as much time as they wish to work for the second entity. The second entity (“Save the Whale”) would be likely to exhibit all sorts of features in common with the “Stop the Bypass” local campaign—for example, a low annual turnover, no permanent staff etc.

18. Any register which sought to include “Save the Whale” but not “Stop the Bypass” would run into severe difficulties. For example, suppose a generous local employer allowed the chief spokesperson some paid time off work to act for “Stop the Bypass”. Is the spokesperson now caught by the rules governing the register? If not, why not? If the individual acting as the anti-bypass spokesperson is running their own company, and uses some of their own working time to work on the local campaign, does this render them a lobbyist?

19. In the last two cases, the “Stop the Bypass” campaign is now in receipt of corporate support—albeit as an “in kind” donation rather than as a direct financial transfer. Does this suggest or imply that the individual is acting for a third party corporate interest? If not, would this change if the company involved in granting the spokesperson time off had a direct interest in stopping the bypass? For example, supposing the company giving the spokesperson time off to campaign was located in an area threatened by compulsory purchase should the bypass go ahead?

20. These examples show the inherent difficulties in drawing any clear lines between a thriving civil society and lobbying as a professional activity. Nevertheless, it may be possible to find ways in which to ensure that campaign groups, think tanks and community groups are not typically included in the register.

Recommendation for a Narrow Definition

21. All of these citizen groups are likely to hold in common the following features:

1.They are run on a not-for-profit basis (irrespective of their precise corporate structure).

2.They are of a relatively modest turnover.

3.They have a relatively modest number of employees.

Additionally, they are likely to share in common with a fourth feature with in-house lobbyists, namely:

4.Their lobbying objectives are explicit or easily presumed.

22. Furthermore, those campaign groups or think tanks which do not exhibit the first three criteria are likely to be better able to comply with the burdens of registering and complying than those which do.

23. Consequently, I would recommend that individuals are excluded from the register if they exhibit all of the following features:

1.They are employed exclusively by not-for-profit organisations. AND

2.These organisations have a combined turnover of less than £5m per annum. AND

3.These organisations employ a total of less than 50 staff (on a full time equivalent basis).

24. An individual who did not meet these criteria and was considered to be a lobbyist could still remove themselves from the register and its accompanying obligations by establishing to the appropriate authorities that their lobbying objectives were clear, public and transparent. This would be presumed to include all lobbyists who were exclusively employed “in-house”—whether for a publicly listed company or for a major campaigning organisation.

25. As stated at the outset, this is a second best option—as I am opposed to a statutory register. Nevertheless, exemptions along these lines would at least mitigate the damage that might accrue to a properly functioning, inclusive and democratic process.

April 2012