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Advisory Committee on Business Appointments Advisory Committee on Business Appointments Nineteenth Annual Report 2017-2018 1 17 July 2018 Dear Prime Minister, This letter accompanies the nineteenth report of the Advisory Committee on Business Appointments, which covers the year to 31 March 2018. In 2017-2018, the Committee considered 230 applications for advice. That included 93 applications from Ministers (compared to 104 applications in 2016-2017); and 137 applications from former senior Crown servants (compared to 140 in 2016-2017). Two long-standing independent committee members completed their terms of office this year and three new independent members were appointed, joining in February 2018. New staff were also recruited to the Committee’s small secretariat team, meaning this was a busy year inducting and training new members and staff, while continuing to advise on individual cases. Many of the applications advised on this year have been complex and required a significant amount of time and resource to fully consider. For example, in the majority of cases considered this year, there was a link between the applicants’ responsibilities in office and the proposed appointment/ employment. This increases the potential for risks to arise under the Government's Business Appointment Rules (the Rules) and means that more information is needed to consider the application appropriately. In the reporting year 2017-18, 67% of applications were dealt with within our target deadlines. Members and the secretariat have worked hard to maintain a steady performance given the complexity of cases and the increase in casework. The results can be seen in the detailed considerations in the advice letters provided and published. This leads me to the Committee’s continued work on transparency. The information contained on our website, and therefore in the public domain, is regularly reviewed. We understand that applicants, members of the public, and those with an interest in the business appointments landscape (particularly given the high levels of media and parliamentary scrutiny of this work) need to understand the Committee's advice. This year the Committee has focussed on increasing the detailed information available in its advice letters. The Committee’s aim is to provide advice which clearly sets out: the information provided by applicants; the information provided by relevant government departments; the risks identified by the Committee; the Committee’s view on the appointment; and the conditions it considers are necessary to mitigate the risks identified. There is now more information available on the Committee’s deliberations and decisions than ever before. You will see in the body of the report that our commitment to transparency is echoed in a number of improvements we have planned for 2018-2019. Last year I commented on the general unease about the principle of people moving between the public and private sectors and concerns about the lack of a statutory system with enforcement powers. The Committee is strongly of the view that debate around the current system and any suggestions for improvement should be based on evidence and with an understanding of the impact of any potential changes. I note with interest that whilst the Public Administration and Constitutional Affairs Committee (PACAC) supported the proposal I put to it, that a cost-benefit analysis of a statutory scheme should be undertaken, the Government does not agree that such analysis is needed at this time. As stated, in its response to PACAC’s report Managing Ministers’ and officials’ conflicts of interest: time for clearer values, 2 principles and action in December 2017, it considers the framework in place is significantly stronger than in place elsewhere in the public sector - though it acknowledged there is room for improvement. I am particularly pleased that the Government has agreed to implement the Committee's suggestion put to PACAC: that non-executive directors (NEDs) on departmental boards should have responsibility for the oversight of the Rules. The Government has confirmed it is now a requirement for departments to ensure that Audit and Risk Committees, chaired by Departmental NEDs, specifically monitor compliance issues relating to the Rules at regular intervals. The Committee believes this will both raise the profile of the Rules and help facilitate better governance at all levels of the business appointments system. In relation to the work of departments, I see it as an important part of my role to raise awareness of the Rules; the Committee’s process; and its considerations. I regularly meet with those responsible for the Rules in each government department to draw attention to the Rules and to discuss any department-specific issues with the relevant Permanent Secretary. I believe there is more departments can do to increase the visibility of the Rules - which apply at all levels of the Civil Service - to encourage compliance and increase applicants’ understanding of the process. My programme of visits to departments is ongoing. Finally, I would like to thank my fellow Committee members and our small secretariat, who serve the public through their diligent work and fair consideration of each case that comes before the Committee. I would also like to pay particular tribute to Mark Addison and Mary Jo Jacobi, who stepped down in 2017, for their conscientious work and invaluable contributions to the Committee. Yours sincerely, Baroness Angela Browning 3 Advisory Committee on Business Appointments Nineteenth Annual Report 2017-2018 Contents Part 1 -The Committee 5 The Committee’s role 5 Membership 6 Expenditure 7 Governance 7 Parliamentary scrutiny 8 Part 2 - The Rules 9 Purpose 9 Scope 9 Part 3 – The Committee’s Approach 11 The decision making process 11 The lobbying ban and contact with Government 12 Taking into account a current public role 13 Payment for waiting periods 13 Retrospective applications 13 Transparency 14 Freedom of Information Act 2000 15 Part 4 - Ministers 16 The Ministerial Codes 16 Applications received 16 The process and timescales 17 Part 5 - Crown Servants 20 Applications received 20 The process and timescales 21 Annex A - Expanded department names 23 Annex B - Biographies of Committee Members 24 Annex C - Chronology of application process for Ministers 27 Annex D - Chronology of application process for senior Crown servants 28 Annex E - The Committee’s correspondence in retrospective cases 29 Annex F - The Committee’s advice to former Ministers 30 Annex G - The Committee’s advice to former senior Crown servants 34 4 Part 1- The Committee The Committee’s role 1. The Advisory Committee on Business Appointments (the Committee) is an independent, advisory, non-departmental public body, sponsored by the Cabinet Office. The Committee was established by the then Prime Minister, Harold Wilson, in 1975 to provide advice on applications from the most senior Crown servants who wish to take up appointments after leaving Crown service. Since 1995, the Committee has also provided advice to Ministers. 2. The Committee’s role today is to provide independent advice on applications submitted under the Government's Business Appointment Rules (Rules1). In doing so it advises on the conditions that should apply to appointments or employment under the Rules for Crown Servants at the most senior level2 (Crown servants at Director General level and above, and their equivalents) and under the Rules for Former Ministers (of the UK, Scottish and Welsh Governments3), which both apply for two years after the individual has left office. It is not within the Committee’s remit to pass judgment on the appointment/ employment with regard to other matters. 3.The Rules apply to both paid and unpaid appointments. Figure 1 shows that whilst the majority of applications considered in the reporting year were for paid appointments/ employment, 21% of the applications looked at related to unpaid roles (such as trustee, non-executive director and honorary positions). 1 Equivalent versions of the Rules are in place for the Diplomatic Service, armed forces and intelligence agencies. 2 Advice is provided to the Foreign Secretary if the applicant is from the diplomatic service or SIS; to the Defence Secretary for most Ministry of Defence staff, both civilian and military; to the First Ministers of Scotland and Wales in the case of staff working in those Devolved Administrations; to the relevant Permanent Secretary if the applicant is a Special Adviser; and to the Prime Minister for all other Crown servants. 3 Advice is provided direct to former Ministers. 5 4. During this reporting period, the Committee considered 230 cases related to 21 different government departments. As shown in figure 2 below, the Cabinet Office and the Ministry of Defence accounted for the largest volume of applications seen by the Committee. The same two departments accounted for the largest number of applications in 2016-2017.4 *Individuals whose former Ministerial/ Crown servant role straddled more than one Department have been counted against each Department. 5. Of these 230 cases, 95 were considered to be retrospective (see paragraphs 49 to 51); and 12 were withdrawn during the consideration process (see paragraphs 37 to 39). 6. The Committee provided final advice on 128 applications of former Crown servants; and on 82 applications of former Ministers. 7. More information about how the Committee approaches its work, and the applications it saw this year, is set out in part 4 (for applications from former Ministers) and part 5 (for applications
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