The Secretive World of Lobbying

Saturday 21 January 2012

Scandal is a word often associated with the business of lobbying. Involving individuals and organisations trying to influence the opinions of politicians, the practice has been tainted by controversies since the notorious cash-for-questions debacle in the 1990s, when MPs accepted sums of money in return for tabling parliamentary questions. In recent months, following the resignation of Tory defence secretary Liam Fox over his links with shadowy lobbyists, it has once again become the focus of intense public scrutiny. But soon, new reforms could be about to clean up the system.

The scale of the problem has long been recognised by those in government. Before he became prime minister in 2010, David Cameron gave an often quoted speech on “secret corporate lobbying” and issued a stark warning. “It arouses people’s worst fears and suspicions about how our political system works,” he said. “It is the next big scandal waiting to happen.”

Unfortunately for Cameron, his prediction soon came true. Since coming to power, aside from the revelations concerning Fox late last year, a series of investigations have shed light on a murky trail that leads straight to the door of the coalition government itself. In December, undercover recordings were published of executives from Bell Pottinger, one of the country’s largest lobbying firms, boasting about the access they had to the prime minister while claiming they could “facilitate” meetings with powerful government figures. Owned by Conservative peer Lord Bell, the company is known to have worked for a host of countries with poor human rights records – including Libya, Syria, Sri Lanka and Rwanda – to help improve their reputations and build potential links with overseas governments.

“Lobbying in itself isn’t a crime,” says Tamasin Cave of the Alliance for Lobbying Transparency (ALT). “But the situation we have at the moment in this country is that we have an unregulated, mainly commercial lobbying industry... It is distorting the democratic process.

“Organisations don’t spend this money [on lobbying] because it has no effect. They are paying for influence and access, and that we see as a problem. So we’re calling for transparency regulations; you can’t stop lobbying but what you can do is make it open to public scrutiny.”

The central issue is that the lobbying industry, estimated to be worth around £2 billion in the UK, is currently self-regulatory and is not obliged by law to publish any details about its activities. Though charity groups and campaigners also often lobby government, large and wealthy corporations (and foreign governments) can have a disproportionate influence by paying well-connected private lobbying firms like Bell Pottinger millions to directly pressurise politicians – yet the public is never made aware about the full extent of the pressure being

To curb this lack of transparency, the government is expected to put forward plans – perhaps as soon as this week – for the introduction of a mandatory lobbying register, which would bring details about who is lobbying who into the public domain. Many believe, however, that much more needs to be done.

ALT, a campaign group formed by a coalition of 15 organisations including Greenpeace and Action Aid, is calling for a number of regulations to be introduced that it believes would make lobbying far more accountable. Aside from a mandatory register, it would like to see all meetings and correspondence between lobbyists and MPs recorded, along with enforceable ethics rules banning the employment of government officials or their relatives for lobbying purposes.

“We think that the public should be able to see who is lobbying who, what they are lobbying about, and how much money in particular is being spent on that piece of lobbying,” Cave says. “We’re behind the times on this issue in this country, and yet we have one of the biggest lobbying industries in the world.”

Among the lobbyists themselves, there is far from consensus on the issue of statutory legislation. Some believe the industry’s self-regulatory body, the UK Public Affairs Council (UKPAC), is doing a good job, but others disagree. This was made clear after the Bell Pottinger scandal, when one professional lobbyists’ group, the Public Relations Consultants Association, withdrew from UKPAC, saying it lacked “credibility and competence” and had failed to do its job.

For Mark Adams OBE, the issues are not so clear cut. A freelance lobbyist and former private secretary to two prime ministers (Tony Blair and John Major), Adams, who runs a blog called Stand Up For Lobbying, argues statutory regulation could in fact make lobbying even less transparent than it already is.

“I remain to be convinced that statutory regulation will make any difference,” he says. “There are a lot of people who’ve argued that self regulation isn’t perfect, but I don’t think any system of statutory regulation is perfect either. What the government is planning to propose with their statutory register – that doesn’t go anywhere near as far as the various self-regulatory bodies already do.”

The latest scandals that have engulfed the lobbying industry have not convinced Adams new laws introduced by the government are necessary. He is also critical of groups calling for stricter accountability.

“We probably wouldn’t have invented the wheel if we were running government in the way that some of these proponents of transparency are calling for,” he says. “I think some of the more extreme so-called transparency measures would actually do more to push lobbying into the shadows than anything the industry has done over the last 20 years to bring it out of the shadows.

“If you have a system of recording every official meeting, nothing of any real interest will be discussed there – it’ll be discussed behind closed doors. What will happen is ministers and MPs will ‘bump into’ people in the margins of conferences, seminars and meetings, or perhaps during lunch – we’re not going to record every lunch.”

In other countries such as America and Canada, lobbying has long been regulated by the state, forcing those who are attempting to influence government to enter on to a centrally maintained, publicly accessible database. In Britain these details often remain undisclosed, and are only uncovered after specific details are requested from government departments under the Freedom of Information Act. One such request recently revealed that a report by the coalition rejecting tougher controls on large pub companies was partly written by powerful industry lobby group the British Beer and Pub Association – with sections of the report copied and pasted directly from industry proposals.

“When we’re at a situation when we have an austerity agenda, and we’ve got cuts left right and centre, it’s important to know whose interests are being served,” says James Graham of reform group Unlock Democracy. “No law in itself can actually transform things – it’s got to come with a culture shift. But what new legislation will do is put the onus on questioning where that culture shift hasn’t happened, and put those individuals in the spotlight.”


Undisclosed connections

Calls to introduce new legislation governing lobbying in the UK grew at the end of last year after revelations in newspapers brought to light undisclosed connections between defence secretary Liam Fox and businessmen who had reportedly paid large sums to lobbying firms for private access to the minister. One private equity boss, Harvey Boulter, was revealed to be paying £10,000 to lobbyists for services including helping arrange a meeting with Fox through his friend Adam Werritty, who claimed to be an official adviser. A separate meeting involving defence industry lobbyist Stephen Crouch and arms sales minister Gerald Howarth was arranged by Fox after payment of a reported £20,000 was made to Werritty. A government investigation found Fox had breached rules governing ministerial conduct, and he was forced to resign, making a humiliating apology in the House of Commons.

Scandal timeline

1994: A Sunday Times reporter posing as a businessman offers 20 MPs £1,000 to table a parliamentary question. Two Conservatives, Graham Riddick and David Treddinick, accept. Both are fined and temporarily suspended from parliament. Months later, Mohamed Al-Fayed, the owner of Harrods, is alleged to have paid MPs Neil Hamilton and Tim Smith £2,000 to table questions. John Major pledges to review “standards in public life”.

1998: An investigation by the Observer exposes three lobbying consultancies bragging about the closeness of their links with Labour. One, Derek Draper, is taped boasting he can sell access to ministers and create tax breaks for clients. An inquiry recommends more stringent self regulation.

2010: A covert sting by Channel 4 and the Sunday Times reveals a number of former Labour cabinet ministers agreeing to accept payments from a bogus US consultancy company offering to help companies win influence by lobbying politicians. Stephen Byers, once trade and transport secretary, describes himself as “like a sort of cab for hire” for up to £5,000 a day. There are calls for a statutory register of lobbyists, with Byers suspended from the Parliamentary Labour Party along with Patricia Hewitt, Geoff Hoon and Margaret Moran.

2011: Undercover reporters record executives from lobbying firm Bell Pottinger boasting about connections to high ranking Conservative politicians including David Cameron and George Osborne. The firm cites an example where it lobbied for vacuum cleaner company Dyson, successfully getting Cameron to raise a Dyson-related copyright issue face to face with the Chinese prime minister. Managing director Tim Collins is filmed saying: “In terms of very fast turnaround and getting things done right at the top of government, if you’ve got the right message, yes, we can do it.”

This article first appeared in issue no.911 of The Big Issue in the North.