The Government needs to introduce a new lobbying act to “clean up this mess” and restore public confidence, said PRCA director general Francis Ingham.
Speaking as fresh questions have been raised over Philip Hammond’s email sent to a senior Treasury official on behalf of a bank he advises, Ingham told PRWeek he believed the Tory peer had not behaved “within the spirit of transparency and ethical lobbying”.
The Office of the Registrar of Consultant Lobbyists (ORCL) has now launched an inquiry into the email sent by Lord Hammond to the Treasury’s second permanent secretary Charles Roxburgh in July last year.
In the email, Lord Hammond, who is on the advisory board of OakNorth bank, advocated the firm was “very keen to ensure that the right people” at the Treasury saw a presentation about software it was offering free to the Government.
Ingham said that, while the PRCA welcomed the regulator’s investigation, he was “perfectly realistic” about Lord Hammond’s argument that he had acted in accordance with the law.
A spokesperson for Hammond had told the FT newspaper “there was clearly no requirement to register this contact under the rules” of the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014.
'Destroying public confidence'
However, Ingham added the PRCA was compelled to act by “again writing to government urging them to review this”.
“The lobbying industry has a really clear message to government,” he said.
“Please introduce a new lobbying act to clean up this mess because what we have at the moment is a complete lack of a level playing field and it is destroying public confidence.
“The lobbying legislation is so narrow it excludes about 80 per cent of the public affairs industry because it deliberately excludes in-house lobbyists.
“I am perfectly realistic about this. There is no appetite within government to review this and there is a consistency about this.
“Every principal opposition party calls for change in this area. David Cameron did when he was leader of the opposition. Every government presses back against it. And then it reverses when the power changes.”
The latest action from the PRCA comes after its Public Affairs Board stressed the need for urgent reforms to the “unfit” current legislation with a six-point plan in April, after revelations of former Prime Minister’s lobbying activity with collapsed financial services firm Greensill Capital.
“At its fundamental heart, there isn’t a desire for ministers to curtail their own financial prospects when they leave office. That’s a bold statement but I believe it to be an absolutely accurate one.
“Yet there is a broad consensus among industry that this current system cannot continue. Government needs reform if we are to have confidence in the political process.”
The PRCA is due to hold its public affairs conference in early October, with the issue of lobbying legislation reform a key priority on the agenda. Stakeholders including Transparency International, founded by former employees of the World Bank, and the Institute of Business Ethics have already shared their views with the PRCA during an invitation-only summit held earlier this summer, and the findings will be unveiled at the autumn conference.
A spokesperson for the ORCL said: “The Registrar is investigating Lord Hammond in relation to potential unregistered consultant lobbying.”
The ORCL added that a case summary would be published once the investigation is complete, but the Registrar does not comment on ongoing investigations.
Lord Hammond - who served as Chancellor, Foreign Secretary and Defence Secretary during the Coalition and Conservative governments of the 2010s - has been contacted for comment.
Letter in full to Michael Gove, as Minister for the Cabinet Office
Dear Mr Gove,
I write as Director General of the PRCA, with regard to the regulation of lobbying, in light of recent media coverage of the commercial activities of the former Chancellor, Philip Hammond, and the former Prime Minister, David Cameron.
The PRCA is the world’s largest professional body for public relations and communications professionals. We are the principal voice and self-regulatory body for the public affairs industry.
Our members subscribe to a rigorous and enforced Code of Conduct; are barred from employing Parliamentarians; their employees or contractors are barred from holding Parliamentary passes (including those who are former MPs); and they must publicly declare all of their clients, and the names of all of their employees, on a quarterly basis.
The public affairs industry serves a vital public service, ensuring that Ministers, civil servants, Parliamentarians and others make informed decisions, based on an understanding of the real world consequences of their knowledge. It is vital that the role played by our industry in the decision-making process inspires public, political, and media confidence.
We are therefore deeply concerned by the corrosive effect of stories such as those regarding Mr Hammond and Mr Cameron.
In the wake of the allegations regarding Mr Cameron, we repeated our long-standing call for changes to the regulation of lobbying; the manner in which the Parliamentary authorities issue Passes; how Ministers behave with regard to the disclosure of their official meetings; and how former Ministers behave after leaving office.
Those recommendations were summarised in six public recommendations, made in April, and shared with the Cabinet Office:
1. The Lobbying Act should be expanded to cover all of those engaged in lobbying – the inclusion of in-house lobbyists is crucial for public confidence. The scope of the Act should be expanded to cover those working in-house in charities, campaigning groups, think tanks, trade unions, business, organisations and private companies.
2. The interactions covered by the Act should be expanded to include Special Advisers and senior civil servants, from Director General level up.
3. The Government should extend the existing limitations on former Ministers taking paid lobbying positions and institute a five-year ban, including on in-house roles. Former Ministers should consistently behave in the spirit of the Nolan Principles.
4. Ministers should stop ignoring the rules under which they are legally obliged to publish Ministerial Diaries in a timely manner.
5. The process governing the award of Parliamentary Passes should be reviewed and tightened significantly. Subsequent to a PRCA investigation into the issuing of Parliamentary Passes, The Times published our data, showing that 200 passholders had no reason to hold them -Chief Executives of think tanks; senior trade union officials; partners in legal and accountancy firms -none of whom could possibly legitimately hold a Pass under the authorities’ definition of being a researcher, secretary, or driver.
6. The Registrar of Consultant Lobbyists should no longer allow registrants to declare self- written and self-policed codes which are neither independent nor independently enforceable.
Four months on, these recommendations are more pressing than ever. Public confidence in the political process risks being severely undermined by these repeated stories of apparently undue access, and indifference to what might be regarded as appropriate standards of behaviour.
If steps are not taken to respond, this plethora of media reports could trigger the worst crisis in public confidence in the political system since the MP expenses scandal of some years ago. We are all aware of the long-term impact that episode had.
The current system is utterly unfit for purpose, and needs urgent reform. The Government and Parliamentary authorities could address this situation with speed if there was a desire to do so. You would find a willing partner in the public affairs industry if you chose to go down that route, and we would ask you to do so as a matter of urgency.
Director General, PRCA