Managing Ministers’ and officials’ conflicts of interest: time for clearer values, principles and action Contents

Summary

The Public Administration Select Committee (PASC) published a report in 2012 on the key issues concerning the Advisory Committee on Business Appointments (ACoBA) and the operation of the Business Appointment Rules. Our new inquiry into Managing Ministers’ Officials’ Conflicts of Interest: Time for Clearer Values, Principles and Action, has shown that nothing significant has changed. PASC made several recommendations, some of which reinforced its previous recommendations. Meanwhile, the problem has escalated, with increased numbers of public servants moving between the public and private sectors, and a number of very high profile cases resulting in declining public confidence in a system that was set up to command trust by mitigating any breaches of the Rules. The Government must urgently review and address these longstanding and recurrent issues.

The regulatory system for scrutinising the post public employment of former Ministers and civil servants is ineffectual and does not inspire public confidence or respect. Our inquiry has revealed numerous gaps in ACoBA’s monitoring process with insufficient attention paid to the principles that should govern business appointments. The failures of governments in this regard have damaged public trust in politics and public institutions and led to repeated scandals. Consequently, we are recommending major reform.

The Business Appointment Rules should be fundamentally changed. A system to manage conflicts of interest needs more than just a code of rules and declarations. A principles-based system, if it is effectively taught by leaders and learned by everyone to be intrinsic to the public service, creates an expectation that individuals will act with integrity, and regulate their own behaviour and attitudes according to those principles. But we believe there should be independent checks across all Government Departments and Executive Agencies to reinforce this, particularly where the risk of conflicts of interest is high. Our report recommends a substantial change of emphasis in the Ministerial Code and the Civil Service Code to highlight the values and prinicples which should guide attitude and behaviour. This goes beyond a mere set of rules. However we also revisit the PASC proposals for a statutory scheme of rules.

ACoBA, in its current form is a toothless regulator which has failed to change the environment around business appointments. There are numerous loopholes, including, for example, civil servants at lower levels who have responsibility for commercial management. These more junior civil servants are not regulated by ACoBA, only by Government Departments, who are required to publish summary information on the advice and restrictions imposed on their former civil servants. The Cabinet Office must publish aggregated data on all applications by members of the Senior Civil Service below SCS3, and the departmental decisions made on them, showing proportions approved without conditions, and, in the case of conditionality, the categories of decisions made. The data must also cover Executive Agencies. Publication should allow public scrutiny of practice across individual departments and Executive Agencies. The Government’s response on this issue was inadequate. All of the above data should be aggregated and available on the ACoBA website.

The Government must take steps to ensure that the ACoBA system is improved swiftly. In the long term, failure do so will lead to an even greater decline in public trust in our democracy and our Government.





21 April 2017