Business Appointment Rules

Written evidence submitted by Sir Andrew Cahn (BA 07)

 

I am grateful to the Committee for the chance to input on the process applied to senior civil servants when they take up business appointments after leaving public service.

 

I appreciate this opportunity to share my thoughts with the Committee. These are my personal views, gained from my own experience, and do not reflect the views of my employers.

 

During my career, I have been privileged to work at a senior level in the civil and diplomatic services. I have twice worked in international organisations. I have also worked at more than one private sector organisation. In other words, I have been a serial interchanger. I know this had made me personally more effective and I believe it has been valuable for the organisations for which I worked.

 

Increased traffic between the civil service and private business would benefit both the economy and society more broadly. The civil service is enriched by people with experience of other walks of life coming in at senior levels.  And senior civil servants deliver a real service if they are able to put their skills and experience to work in new areas, particularly as they are still encouraged to retire at 60.

 

As a strong advocate of interchange between the public and private sectors, I believe the ACOBA process could be improved. Civil servants take up fewer appointments in the private sector than in many comparable economies to our own and the movement from the private sector to public service should be increased. I believe the "revolving door" is broadly beneficial and should be more encouraged than now, providing there are adequate safeguards.

 

In this submission, I outline where I believe improvements could be made and why I feel such improvements are important.

 

· First, civil servants can be of most benefit to the private sector in areas where they have most experience. Likewise, people from the private sector can most usefully contribute to the public sector if they are given the opportunity to work in areas they know well. Of course, I appreciate that this type of interchange requires particular care and oversight. But, the ACOBA process starts from the presumption that it is precisely these areas which need to be discouraged.

 

· Present stipulations may indirectly reduce the UK’s appeal to foreign companies. These firms appreciate advice and guidance from those formerly in government service and, if onerous restrictions are placed on civil servants taking up such appointments, it can present the UK in an unflattering light.

 

 

· The current process appears to place more importance on procedure and appearances than principles. While an element of procedure is essential, it may be advantageous to place greater trust in people’s experiences, integrity and good conduct.

 

· The process is slow, particularly with reference to private sector timescales and practices. This can dissuade the private sector from employing civil servants and would-be civil servants from entering public service. Companies do not expect to have to wait months before being told whether or not they can employ someone and if so with what conditions.

 

As someone with experience of both sectors, I would like to explain further where I believe changes to the current process could most usefully be made

 

Useful experience should be encouraged: Civil servants are naturally most likely to be useful to outside employers in areas where they have experience. And the same principle applies to people from the private sector who wish to contribute to the public service. But the ACOBA process is most onerous in these very situations. While the diligence behind this approach is commendable, it would be helpful if current procedures could be adapted so as to ensure civil servants and would-be civil servants can be as useful and productive as possible when they move from one sector to another.

 

Lifting restraints on movement: The ACOBA process asserts with no authority that civil servants above a certain grade must obtain authorization to work for two years and frequently instructs them not to take a job for a period of time. Civil servants often approach the process with nervousness because of the lack of clarity. Sometimes, they even feel the wish to join the private sector is somehow reprehensible. Clearly, the Committee would not wish to foster such attitudes so there may be benefits in changing the process so it offers more encouragement to civil servants considering appointments in the private sector.

 

Promoting foreign investment: Foreign companies considering investment in the UK need local expertise, knowledge and experience. They seek advice on how things work here, which factors to take into account in their business decisions and the intricacies of our business, political, economic and social milieu. The services of former civil servants can be genuinely helpful, but current restrictions around their employment can prove perplexing to foreign companies. There would be advantages in promoting a more transparent and open process.

 

A principled approach: We can never guarantee that people will not behave improperly but we can put in place a culture and a set of values to encourage them to do so. Fortunately, the civil service is built around probity, integrity and proper conduct. This is the best possible insurance against impropriety when people move between the private and public sectors.

 

Contractual obligations: Most people who join the civil service at a senior level are given contracts, at the end of which they may have to wait for three months before returning to the private sector. This is tantamount to a 10 per cent reduction in salary and often comes as a surprise since clear guidance is not provided at the outset. The civil service reaps meaningful benefits from private sector input. If the process could be made more welcoming, two-way traffic would undoubtedly increase, to the advantage of both sectors and the public at large.

 

Potential for improvement: Clearly, there is a need for care and caution when civil servants move into the private sector and vice versa. But I believe increased transparency may prove helpful in this regard, enhancing the ACOBA process and perhaps allowing it to change in emphasis.

 

When a public servant takes up a position in the private sector, I would suggest that it should be in the public domain so Parliament, the press and the Civil Service itself can observe how that individual acts and how former colleagues act towards him or her. This would be of real value whilst a three or six month cooling off period is of little real benefit if someone is bent on misusing their position.

 

Clearly no process, however fastidious, can regulate employment in such a way as to completely prevent irregularities. Ultimately, public servants must be trusted to act with integrity after their departure. Nonetheless, complete transparency would act as a useful deterrent to abuse.

 

Conclusion: I have been a serial interchanger throughout my career and I firmly believe that I have been more effective and better able to contribute to the public good as a result.

 

Across the UK, civil servants and the private sector contribute enormously to the country’s wellbeing. Each can provide valuable advice and guidance to the other. Using the skills and experience of both in the most productive way must be in everyone’s best interest. Effective and efficient interchange allows the civil service to benefit from new blood and new thinking, while the private sector can benefit from civil servants’ expertise and understanding.

 

With this in mind, it may be helpful to shift the focus of the interchange process towards self-regulation. A culture of probity already exists across the civil service and in much of the private sector too. Perhaps we should be more mindful of that when dealing with the very real benefits that interchange can bring.

 

An act I witnessed in my first few weeks as a civil servant in 1973 has stayed with me. My principal was sent a large bouquet of flowers for having done something entirely properly and efficiently. She sent a gracious letter of thanks, noting that she had sent the flowers on to a children’s home and suggesting that next time she would prefer not to be put in a difficult position by an inappropriate gift. I think I learnt more from that than from the guidance on ACOBA’s website.

March 2012