ROUND TABLE: Scotland crossing the political divide - Kate Nicholas reports on Scotland's government relations dilemma

'Rogue lobbyists could face prison' - ran a headline in the Sunday

Herald the day before the Scottish Parliament's Standards Committee

began consultation with lobbyists over proposed regulation in August. A

delicious irony given that, as Mike Rumbles, Lib Dem convenor of

theCommittee points out, from its very inception two years ago, the

watchwords of the devolved Scottish political system have been 'openness

and transparency'.



Yet now the committee is seeking to introduce a system of regulation

deemed too draconian even by the Nolan committee and, according to the

Herald, is recommending that those who err be punished with £5,000

fines or even prison. As Alex Pagett, Royal Bank of Scotland MD of group

corporate communications, points out, this does seem to be 'taking a

sledgehammer to crack a nut'.



'It is sad because this country is uniquely different from England in

that you have got 50 million all struggling to get their point made and

up here we have this little village. What we are trying to do is to

create a dialogue and all this is an effort to stifle it. In PR terms it

is a disaster,' he says.



As the industry waits to hear if the committee will be willing to take

oral evidence - if not on the principles, then at least the practice of

the proposed regulations - I met with a roundtable of PA consultants,

government officials, NGOs and corporate communications directors. The

group, convened by John Gerrie, co-founder of Metropublic (one of a

coupl eof recent start-ups by Weber Shandwick alumni), talked about the

likely impact on government relations and the opportunities and

challenges contained therein.



Angela Casey, convenor of the Association for Scottish Public Affairs

(ASPA), who has condemned the plans as 'unfair and unworkable' was one

of a number of players unable to attend. But two of the most vocal panel

members, Pagett and ASPA member and McGrigor Donald public policy

director Adam Bruce had recently attended a meeting for the Scottish

Council for Development and Industry at which Rumbles gave the first

real response subsequent to the close of the summer consultation period.

They say the news is not good.



The prospect of a registration scheme for lobbyists appears a forgone

conclusion, the industry's recommendation of Nolan-style self-regulation

having been given short shrift. Rumbles has also made it clear that his

target is the commercial lobbying community - the only questions now

remaining are what exactly commercial lobbyists will be asked to

disclose in terms of client lists, fees and the business they are

engaged in.



Bruce is obviously dissatisfied at the level of dialogue between the

committee and the industry, saying: 'ASPA is still extremely concerned

not so much about the ideas of registration, as obviously there are

several countries where registration of lobbyists is in practice. What

we are concerned about are the mechanisms.'



Pagett was also at pains to point out that while the proposed

registration was a 'knee-jerk' reaction to the well-known 1999 cash for

access scandal, it wouldn't stop another 'lobbygate'. Bruce says: 'I

think that the saddest aspect of all of this is that post-devolution,

there was an intention for greater openness and accountability and it

would be very sad if this process puts up a barrier.'



As he points out, most of the existing registration schemes - such as

the US Congress Lobbying Disclosure Act - are based upon contacts with

legislators. However, the proposed Scottish system includes all

provision of information and advice to companies as well as direct

contact with MSPs undertaken on their behalf. It is a cruel blow to an

industry seeking to carve itself out a broader role than that of the

traditional lobbyist.



In fact, among the consultancies present, such as Weber Shandwick and

Countrywide Porter Novelli, there is a real fear that the imprecise

definition of lobbying by the committee will prove the last nail in the

coffin of an already beleaguered industry. 'It will drive a lot of the

existing business that currently resides with public affairs

organisations back in-house which is obviously going to affect income

and will to some extent damage the Scottish economy,' claims Scottish

Public Relations Consultants Association chair and WSW Scotland MD Nora

Farrell.



'Why should there be any lobbying in Scotland if it all has to be done

in-house? Why not use a Southern-based organisation? You would not have

to register who you were talking with or reveal the fees associated. In

many cases, clients are going to be very unhappy to reveal how much they

are paying lobbyists,' says Farrell.



Ian Coldwell, chair of the IPR in Scotland and Pagoda PR managing

director, goes further to suggest that UK agencies with a presence in

Brussels may be able to circumvent the regulations by meeting MSPs off

home territory: 'I am not convinced that the Scottish parliament will be

able to exercise powers outside of Scotland and this could lead to

discrimination against indigenous Scottish-based companies.'



Aside from the inevitable self-interests of the PA industry, there were

some broader concerns voiced about the impact that restrictions will

have on the broader democratic process. Farrell argues that the squeeze

on lobbying firms will restrict the share of voice of smaller companies

that do not have large in-house PA resources and would be more likely to

bring in consultancies on a project basis to deal with specific

issues.



Gerrie illustrates the point: 'If you were lobbying on behalf of a

pharmaceutical giant then the largesse of your resource would enable you

to make your case very acceptable to parliamentarians. But if you were a

health charity, for example, you would be disenfranchised because there

was nobody who you could turn to and buy advice, or share of voice.'



There is also the issue of confidentiality. If the small health charity

hired a consultancy, for example, and disclosed the nature of the advice

given, fees and MSPs spoken to - then a large industrial firm taking an

opposing position can glean this valuable information for free.



Such 'live' registration is also likely to make companies less inclined

to brief MSPs on commercially sensitive developments in their

constituency.



The theory is that while a company may wish to brief MSPs to avoid them

being caught on the hop, registration would make such an act tantamount

to going public with an announcement and in the case of quoted companies

could be price sensitive.



Farrell argues that there are also moral implications because 'if a

company makes a decision but hasn't consulted at a parliamentary level,

they are making a decision based on a commercial concerns rather than

looking at the bigger picture.'



Health Education Board for Scotland head of public affairs Martin

Raymond believes, however, that the enforced changes in the relationship

between MSPs and companies that seek to lobby could lead to the creation

of a new form of lobbying: 'It is all completely new and many

parliamentarians are searching for a style and way of communicating with

constituents and interested parties.'



So in what form will this new type of relationship manifest itself? 'In

creating opportunities for dialogue between elected members and

organisations or companies who want to speak to them,' says Gerrie.

'Often the only opportunity companies have to speak to an elected

representative is when something bad happens, such as the closure of a

factory. We need to create opportunities to bring elected members

actually into businesses on a regular basis. The challenge is to have

sufficient clout within the company to say, I think if we took this

initiative on the environment, we could then create opportunities for

political representatives to be involved.'



Attention is also likely to move from Parliament to the Scottish

Executive and its agencies. Scottish Executive head of new media and

presentation Roger Williams is focusing much of his energies on

promoting partnerships between the Executive, its agencies and

Scotland's enterprise culture: 'It is incumbent upon corporations and

plcs to see if they can help constructively with campaigns we are

dealing with.'



'There is potential for government and business to work much more

closely together because it is a much smaller state and those that are

too focused on Westminster are going to miss that opportunity. The

mechanism of competition in the market will show this as time goes by,'

says CPN director Anne McMunn.



Pagett agrees: 'The opportunities particularly for the commercial sector

are there for the taking, particularly in a country such as Scotland

because there is a small population and the proximity between the

various players.'



Raymond, says, however, that the Health Education Board are already

experimenting and that some very interesting partnerships are beginning

to emerge such as ICL, BT and Microsoft's involvement with the charity

Young Scot, which he chairs.



Indeed, there are no shortage of examples. The Scottish Community

Foundation communications director Carole Gray points to the banking

sector and, in particular, Lloyds TSB which has worked with the Scottish

Executive on addressing hardship created by the foot-and-mouth

crisis.



Of course, CSR is not new and is certainly not unique to Scotland, but

practitioners argue that the economies of scale makes it easier to

develop and facilitate relationships between government and local

businesses, as long as it is possible to overcome what Pagett describes

as an indigenous 'arrogance' and disregard of reputation's impact.



What is clear is that relations between government and commerce are at

something of a watershed. There are enormous opportunities but great

hurdles to overcome. A decision is expected by the end of October on

whether the committee will take oral evidence. The arguments are

persuasive, the industry should hope they are willing to listen.



SCOTTISH EXECUTIVE DEVELOPING COMMUNICATIONS



Prior to his untimely demise, Scotland's First Minister Donald Dewar

introduced a policy that is likely to have a lasting impact on the PR

industry in Scotland.



On his instructions, the Scottish Executive, plus all executive agencies

and government departments now have to undertake an annual audit of

their PR spend, declaring all contacts and contracts.



IPR Scottish chairman Ian Coldwell believes the move is 'indicative of a

culture of suspicion of PR consultants in Scotland' and suspects that it

will lead to 'an increasing nervousness in the public sector about using

consultants with more emphasis on building in-house resources.' PR and

ad agencies with a PR brief currently under contract are Barkers

Scotland, Foulds and Yellow M.



The in-house resource at the executive consists of approximately 65

staff including the recently appointed chief press officer Colin Imrie

(PRWeek, 31 August). Imrie oversees around 50 staff including a

strategic communications unit unashamedly modelled on the comms

machinery at Number 10.



Roger Williams, heads the new media and presentation (communications)

department of around ten staff. This includes a three-man executive

online team, plus an advertising and marketing department, whose funding

appears to be steadily increasing as the devolved political vehicle

focuses on its branding.



According to Williams, the past two years have seen a considerable

growth in the importance of new media, marketing and advertising to the

new Parliament, with a considerable emphasis on promoting Scotland

abroad.



As part of this drive, Williams works closely with the Scottish

Executive-funded Scottish Enterprise, VisitScotland (formerly the

Scottish Tourist Board), Health Education Board for Scotland and Locate

Scotland, the body largely responsible for attracting inward

investment.



Among the initiatives to come out of the Scottish Executive's

communications department in recent months is an online news service,

first proposed by the Deputy Minister for Finance Peter Peacock.



The online news service (www. scotland.gov.uk), which launched in

September was overseen by Roger Williams and created by William Paul,

formerly editor of The Scotsman's online service.



'The Scottish Executive website was pretty workmanlike prior to the

relaunch. Ministers wanted to put news online but they were basically

just putting up press releases. We looked to Number 10 for inspiration

and the BBC, but wanted it to be different,' says Williams.



The site is intended as a complement to current media relations and PR.

It is divided into three distinct areas: news, publications and

consultations, as well as the usual links and contracts.



The news area includes a weekly review of Executive events; records of

lobby briefingsand a First Ministers question section, which it is

intended will soon include a video stream, planned to be up and running

by the end of the year.



Aside from the drier aspects designed for hardened political hacks,

there is a junior exec section aimed specifically at schools. The

Executive plans to conduct an e-mail marketing campaign to all schools

in Scotland to draw attention to the site - and is currently liaising

with the local authorities for the necessary permission. There are also

plans to include a Number 10-style walk through of Bute House, home of

the First Minister.



The Government is generally behind on developments in new media and this

is now about catching up. But Williams says that they will be ahead of

Whitehall: 'We are complementing an existing press office service - it

is an additional way of communicating with the public. A lot of the

stories that would come out in a press release just wouldn't be used by

the media as they are too minor.' The service is currently free but the

Scottish Executive will be introducing a subscription service for e-mail

alerts.



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