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

5The importance of values and of the principles behind the Rules

95.The values and principles governing integrity are currently set out in three main sources: the Ministerial Code, the Civil Service Code and the Civil Service Management Code (CSMC).122 All three codes are based on the Seven Principles of Public Life (the Nolan Principles). Ministers are solely responsible for the governance and content of both the Ministerial and Civil Service codes, as they are for the Business Appointment Rules (the Rules).

a)The Ministerial Code reiterates the Nolan Principles but is largely a list of rules and procedures for Ministers to observe while in office. It opens with the “General principle” that “Ministers for the Crown are expected to behave in a way that upholds the highest standards for propriety”, and under “principles of ministerial conduct” it states: former Ministers must ensure that no conflict arises, or appears to arise, between their public duties and their private interests.” Paragraph 7 deals with “Ministers’ Private Interests”. This is almost entirely taken up with the question of how Ministers should address their current interest, though paragraph 7.7 states, “Ministers’ decisions should not be influenced by the hope or expectation of future employment with a particular firm or organisation”. This represents a mere 20 words in a document of more than 9,000 words. There is no text or guidance about how to be alert to, or to manage, this particular potential conflict. At the same time however, we also need to be mindful of younger Ministers’ legitimate aspiration to earn a living post public office. Achieving ministerial office is not necessarily deemed to be the pinnacle of an individual’s career, nor indeed a job for life. Paragraph 7.25 makes reference to the Business Appointment Rules to be observed but only “On leaving office”.

b)The Civil Service Code is a high-level statement outlining the Civil Service’s core values (“integrity”, “honesty”, objectivity” and “impartiality”) and the standards of behaviour expected of all civil servants in upholding these values.123 This is backed up by the CSMC, which is a more detailed manual outlining civil servants’ terms and conditions of service for Government Departments and agencies.124

96.From these values it is possible to deduce indirectly that a civil servant should never use their public office to benefit a prospective third party in anticipation of an offer of future employment. However, the Code places no explicit obligation on civil servants never to act in a way that furthers a post-public employment objective, as in the Ministerial Code. It therefore lacks the clear principle which would express their obligation to give their total commitment to public service and which refers clearly to their conduct in their public employment.

97.The CSMC does link the Civil Service Code’s four high-level values directly to post-public employment but primarily only as a justification for the operational rules to be applied by ACoBA and departments in granting or withholding approvals, rather than as a statement of overriding principle guiding the behaviour of public servants themselves, and while they remain in office125. Moreover what little is said is only set out in an annex (Annex A, S 4.3.1 of the CSMC), rather than in the main body of ethical requirements. This relegates the statement from a fundamental principle, while holding office, to a compliance regulation on exit. In fact we note that in a document of 30,000 words, the “principles” section of the CSMC takes up a mere twenty-three lines. Moreover, as with the Civil Service Code, it does not explicitly mention the importance of the principles that should guide office-holders when in office, and when seeking subsequent private-sector employment.

98.PACAC took advice from Dame Janet Paraskeva on the operation of rules for regulating conduct. This advice was eflected in our submission to the Parliamentary Commissioner for Standards on the revised Code of Conduct for MPs.126 As well as having clear rules for governing conflicts of interest in respect of post-public employment of Ministers and public servants, it is also vital and in the public interest to have a clear statement of the principles to underpin and inform the rules. It should also be clear that these principles rest upon and reflect the values by which we expect Ministers and public servants to live in their working lives. Moreover, the values, principles and rules and their purpose must be understood. Otherwise there is a danger that individuals interpret the rules, or absence of a particular rule, in such a way as to justify their conduct, or even as implicit permission to do something which conflicts with the intended purpose of the rules.

99.As highlighted in PASC’s 2012 report, Business Appointment Rules, the Rules are for the most part focussed on the procedures to be followed, rather than on values and principles. They are not clear about the principles that should guide individuals’ conduct and inform ACoBA’s advice127. Such principles, if clear and published, would also serve as a guide to better inform the behaviour and attitudes of public servants. This should be ACoBA’s prime purpose: to influence and to promote attitudes and behaviour. Only the first three paragraphs address the “Key principles” and “aim” of the Rules, while paragraphs 4 to 22—the bulk of the Rules—focus on “Who must apply, when and how”. This means that these so called rules are merely procedures to be followed.

100.Private Eye journalist, Richard Brooks highlighted the importance of principles in preventing potential conflicts of interest:

I think you do not have hard and fast rules; you have principles. Your code has principles and you have commissioners, or Committees like yours that can pass judgment on whether those principles have been followed. You say that a principle, for example, is that you do not take a job in an area where you have had influence in public life. It is pretty simple.128

101.Professor Philp, Chair of the Committee on Standards in Public Life Research Advisory Board said that “institutions responsible for enforcing regulation or advisory codes and standards” should be “seen to act impartially on principles that the public can understand and that they think reasonable”. Unlock Democracy and Spinwatch shared this view and highlighted that within the Rules “there is no indication of any thresholds of appropriateness in each of these areas”.129 They believe that this therefore “makes the judgment entirely subjective, which without detailed justifications, makes public or parliamentary scrutiny difficult”.130 The UK Open Government Civil Society Network told us that “increased clarity around decision-making guidelines is also necessary to allow the press, public and wider civil society to engage with and scrutinise the Committee’s decisions”.131

102.In PASC’s report, Business Appointment Rules, the Committee proposed that these principles should be made explicit, and should be consistent for all applications (whether considered by ACoBA or departments, and whether from former Ministers or civil servants).132 At present, the Rules state “there should be no cause for any suspicion of impropriety” in respect of former Ministers and civil servants taking up appointments after leaving public office. Again, there is no explanation or guidance setting out what steps should be followed to avoid any such suspicion. The Rules themselves are more concerned with the ACoBA procedures. The Government rejected this proposal, stating that the “Rules for both former Ministers and former civil servants, strike an appropriate balance between explaining the propriety aims and principles that underpin them, and the practical process that applicants need to follow in submitting an application under the Rules”.133

103.In an age where a certain set of shared values can no longer be assumed to be embedded in our society, the Government must set out clear values and a clear set of principles to define how public servants should think about their future career moves and their subsequent career outside of the public sector. These values and principles need to be made explicit and understood by public servants, in order to foster an improvement in attitudes and behaviour, in order to challenge what has become the established culture–the “new normal”. As such they should be included in amendments to the Ministerial Code and the Civil Service Code. This is a pre-requisite for strengthening public confidence, which is lacking in the current operation of ACoBA and the Business Appointment Rules.

104.The key principles should be that no one takes a job for a specified period, currently two years, in which there is a perceived conflict of interest with their past employment in the public service, and no one should have a job in the public service in which there could be a perceived conflict with their past career in the private sector. This would address the concern that a public servant’s conduct in public office is being compromised by their hope of gaining employment from the companies they deal with in their work. The head of the Civil Service and the Prime Minister are personally responsible to Parliament for ensuring that Ministers and civil servants follow such a set of principles. At present this responsibility is not being adequately fulfilled.

105.PACAC recommends the Government should adopt the principles and incorporate the following text into the Civil Service Code

“You must:

“You must not:

106.These principles (also set out in out in Apendix 2 to this report) set out how public servants should behave in respect of private sector interests while conducting their work in the public sector, and how they should therefore conduct themselves in respect of any move or potential move to the private sector. As well as informing the purpose and scope of the ACoBA rules, leaders in the public sector must impress upon all public servants, the need to reflect these principles in their attitude and behaviour, in respect of potential private sector employers. Without greater clarity and understanding of what moral behaviour is expected of public servants, the culture that has become established in public life that individuals are entitled to capitalise on their public sector experience when they move into the private sector without clear boundaries–the “new normal”–will become ever more entrenched, and public confidence in the effectiveness of ACoBA’s advice to former Ministers and civil servants will diminish further.

107.Equivalent text should also be included in the Ministerial Code.

108.The Civil Service Management Code should also be amended along the lines set out in Appendix 2. Only by reinforcing these principles while civil servants are in office will it be possible to inculcate a strong public-service ethos that continues to influence the behaviour of office-holders once they have departed public service. At that career point, other than through post-employment enforcement, which presents difficulties of its own, principles can only affect behaviour if they have already been very strongly internalised. In the Committee’s view this makes it all the more urgent that the Government moves quickly to revise both the Civil Service Code and the Civil Service Management Code in the way we propose.

Making Ministers and civil servants aware of the Rules

109.The ACoBA 2015–16 annual report states that the Rules for civil servants can be found on the ACoBA website and departmental intranets. The report also notes that “the Ministerial Code for the UK Government, Scottish Government and Welsh Government all require former Ministers to seek the Committee’s advice before taking up appointments in the two-year period after they leave Ministerial office”.135 At the time of our oral evidence sessions, [October 2016] the only reference to the Rules in the Ministerial Code was made in paragraph 7.25.136 Baroness Browning was aware of this lack of prominence and in November 2015 recommended in correspondence to the then Cabinet Office Minister, the Rt Hon Matthew Hancock MP that the Rules should be annexed in full to the Ministerial Code.137 Chris Skidmore MP told us that the Cabinet Office is keen to work out how it “can communicate more effectively, either to Ministers or civil servants that the rules and regulations should be taken seriously”. He added that “when it comes to, for instance, appending the rules to the Ministerial Code, that will be taking place”.138 While this report was in draft the Cabinet Office annexed the Rules in full to the Ministerial Code, which was published on 21 December 2016.139

110.In relation to guidance to civil servants and departmental managers, Professor Hine suggested that much more could be done to increase the prominence of the Rules in the Civil Service Management Code (CSMC), parts of which (especially section 4.3) constitute a more detailed and instructive code of professional ethics for civil servants than the Civil Service Code.140 He noted however that recent versions of the CSMC seemed to have lost important parts of the guidance on post-employment ethics that had been present in earlier versions of the Code.141 In particular he noted that the helpful and detailed statement to departments on the principles to be used in handling applications for post public employment was no longer present.142

111.The guidance to civil servants and departmental managers which has for some reason been removed from the Civil Service Management Code should be reincluded in a prominent position. It is reproduced at the end of this report as Appendix 1. We believe this is important for all civil servants, including those below the level of SCS3 who on transfer out of public service, will have their post-employment requests dealt with by their departments. It also needs to be reinforced in respect of departmental officials who deal with such requests. It is vital that the principles are clearly defined in the Civil Service Management Code, which is in matters of procedure, just as important as the ethical guidance contained in the shorter and more generic Civil Service Code.

Embedding ethical standards

112.It is one thing to have guidance published; it is another for Ministers, civil servants and departmental managers to be aware of it and to internalise it. Currently, the Government does not provide much if any training in ethics to civil servants and Ministers. In response to a question about how the Government can embed ethical standards by changing organisational culture, Alexandra Runswick, Director of Unlock Democracy said that “a lot of it is about training” but that “there was some resistance to that because the concern was if you have ethics training, the suggestion is that you didn’t have ethics beforehand, and it gets caught up politically. A lot of it is about the values of the organisation, understanding that transparency is not a threat”.143

113.In its report, Ethics in Practice: Promoting Conduct in Public Life, published in 2014 the Committee on Standards in Public Life looked at the issue of embedding ethical standards.144 It concluded that leadership was key to embedding ethical standards and that leaders should specifically accept, promote and participate in “the guidance and education, and in particular the induction training, that formed Lord Nolan’s third thread for ensuring that the Principles were understood and the highest standards of propriety in public life established and maintained”.145

114.We welcome the Government’s action to append in full the Business Appointment Rules to the Ministerial Code. We believe this will help to ensure that Ministers are fully aware of the Rules and hence what is expected of them if they move into the private sector. We recommend that the statement on principles to be used in handling applications for post public employment, as included in the 2006 Civil Service Management Code (CSMC), also be attached as an annex to the Ministerial Code. We also recommend that this is reincluded into the CSMC itself, as used to be the case.

115.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. If people are expected to be alive to conflicts, actual, potential and perceived, and that they will exclude themselves from decision-making where such conflicts arise, they are far more likely to behave accordingly. We commend the research undertaken by the Committee on Standards in Public Life to address how principles can be embedded into public service. The Government must ensure that compulsory training on the principles of public ethics and standards are provided as part the induction process for any new public servant, including for new Ministers. This must be reinforced in leadership training provided to public servants, whenever they are moved to a new appointment and again on departure from public office.

122 See the Ministerial Code: ; the Civil Service Code:, and the Civil Service Management Code:

124 The Civil Service Management Code was issued under the authority of Part 1 of the Constitutional Reform and Government Act 2010 authorising the Minister for the Civil Service to regulate the whole Civil Service, including terms and conditions of service.

125 Civil Service Management Code, November 2016: Chapter 4,

127 The Public Administration Select Committee, Business Appointment Rules, Third Report of Session 2012–13, 25 July 2012, HC 404 [incorporating HC 1762–i–v, Session 2010–12], para 38.

129 Unlock Democracy and Spinwatch (ACB06), point 16.

130 Unlock Democracy and Spinwatch (ACB06).

131 UK Open Government Civil Society Network (ACB03), point 19.

132 UK Open Government Civil Society Network (ACB03).

133 The Public Administration Select Committee, Business Appointment Rules: Government Response to the Committee’s Third Report of Session 202–13, First Special Report of Session 2014–15, HC 563, para 15.

134 This injunction is to last for whatever period is determined by your employing department, or, in the case of officials at SCS 3, by the Advisory Committee on Business Appointments. For a specified period, [currently] two years after leaving the public service you may not take any employment without the specific prior approval of your department or the Advisory Committee. These requirements form part of your conditions of employment as a public servant, as set out in the Civil service Management Code.

136 Reference to the Rules is made in the main body of the Ministerial Code, December 2016, p.18; para 7.25.

137 Supplementary evidence from Baroness Angela Browning, Chair, Advisory Committee on Business Appointments (ACO 01)

139 Cabinet Office (ACB15).

141 Professor David Hine (ACB13), para 10.

142 Civil Service Management Code 2006, Annex 4.3 B: Guidance to Departments and Agencies on the Rules on the Acceptance of Outside Appointments by Crown servants.

145 The Seven Principles of Public Life were accompanied by three ‘threads’ intended to establish the principles in practice: codes of conduct, independent scrutiny, and guidance and education. See Commons Library Briefing Paper 04888, 27 May 2015, p.6.

21 April 2017