Standards, Procedures and Public Appointments Committee

Meeting date: Thursday, November 16, 2017

Official Report 360KB pdf

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Lobbying (Scotland) Act 2016

Agenda item 4 is evidence from Dougie Wands, the acting lobbying registrar, on draft parliamentary guidance on the lobbying register and a code of conduct for lobbyists. I welcome Mr Wands to the meeting—he is no stranger to our committee, but today he is on the other side of the table.

We would be delighted if you could make an opening statement.

Thank you very much, convener, and good morning. I hope that it will be helpful if I say a few words by way of introduction to this item of business.

As you know, I have recently taken over from my colleague Billy McLaren as the acting lobbying registrar. Some members of the committee will remember that Billy appeared before the committee in September to discuss preparations for implementation of the Lobbying (Scotland) Act 2016. At that time, there was a need to make a lobbying resolution and to issue directions to the Commissioner for Ethical Standards in Public Life in Scotland as part of those preparations. I am pleased to say that those elements are now confirmed.

Since then, we have announced the intention to bring the act into force on 12 March 2018. On 23 October, we made the new lobbying register website available for a four-month familiarisation period to allow potential registrants to prepare for the act coming into force.

The purpose of my appearance before the committee is to ask it to consider the draft parliamentary guidance that the 2016 act requires the Parliament to produce to support organisations that will need to use the lobbying register. The act requires the Parliament to consult the Scottish ministers on the guidance before it can be finalised.

The committee has also been provided with a copy of a draft code of conduct for persons lobbying members of the Parliament. Again, that is a requirement of the act, although in this case the Scottish ministers do not need to be consulted on the terms of the code. The code is intended to be a set of high-level principles for anyone who lobbies MSPs, and in many respects it mirrors the rules on lobbying and access that are contained in section 5 of the code of conduct for MSPs.

Both documents have been produced in collaboration with a lobbying register working group that the lobbying registrar formed earlier this year. The group includes representatives from a wide range of stakeholders and stakeholder organisations, including public affairs professionals, third sector representatives and pro-transparency organisations.

The lobbying registrar team has valued greatly the input and support that we have received from all members of the group during the development of the two documents that are before the committee. They have provided constructive suggestions and feedback from the sectors that each of them represents.

As part of the committee’s consideration of the draft parliamentary guidance, I need to draw to members’ attention one minor change that the working group has identified needs to be made. In the “Events” section of the guidance document that members have in their papers, the reference to “staff” in the fourth paragraph on page 16 should actually be to “employees or other office-holders”. That is to ensure that that part of the guidance reflects accurately the terms of the act.

I conclude my opening remarks on that point, and I will happily take questions from the committee.

Can you give us a brief summary of the most important things that MSPs and their offices should be aware of in relation to how they act and what they say? What are the top issues?

The first thing to be clear about is that the act places the onus on organisations that are lobbying MSPs to take action, which is to register communications that comply with the act’s definition of regulated lobbying. Such organisations must register those communications on the lobbying register from 12 March. That does not mean that MSPs, ministers and others—special advisers and the permanent secretary—do not have a role in ensuring that the act is implemented properly. When, as MSPs, you have conversations with people who are lobbying you, you want to be aware that that is the nature of the conversation.

The definition of regulated lobbying is communication that is “made orally” using spoken word or signs, such as British Sign Language, and “in person”, such as in face-to-face meetings with MSPs, Scottish Government ministers or law officers, special advisers in the Scottish Government or the Scottish Government’s permanent secretary. In addition, the subject of the communication must be about the Scottish Government or parliamentary functions. The act is a little more complex, because there are several exemptions, which means that some communications will be exempt.

We hope that MSPs will help to promote the act to the people with whom they engage so that they are at least aware that they may have an obligation to register meetings.

Members will also be interested in the register entries that relate to meetings that you have. We are ensuring that the system will allow us to alert you when a meeting that you have participated in is registered.

You mentioned that the communication must be oral rather than written. Is there any scope for written communications to come under the 2016 act, considering that so much information comes via email and so on?

On the content being specifically related to an MSP’s function, in many discussions there are a lot of grey areas as to whether things relate specifically to an MSP’s function or whether they are just social. Do you have any guidance on written communications and on whether a conversation over a quick cup of coffee would be covered?

I can clear up the first point very quickly. Written communications are not captured by the act—they are excluded from the definition, which relates purely to oral, face-to-face engagements. No form of written communication—including email, letters and tweets—is covered by the Lobbying (Scotland) Act 2016.

Regulated lobbying could happen in more social settings—it does not have to be a formal meeting. However, the communication would still need to comply with the definition in the act. A casual conversation along the lines of, “Hello. How are you? How are you getting on in your role?” would not constitute regulated lobbying because it would not be someone seeking to inform or influence you in respect of either your parliamentary role or—if you were a minister—in your ministerial capacity. That is not to say that regulated lobbying could not take place at social occasions, but someone would have to talk to you about your working role as an MSP and seek to inform or influence you in that respect.

I want to pose a scenario to explore the distinction between oral and written communications. An MSP is having a social conversation with a member of a trade union or the policy officer of a third sector body and it is not regulated lobbying, but then that person pulls out a bit of paper, writes something down, folds it and hands it over to the MSP. Given that that is a written, not oral, communication, does it count as lobbying?

I am clear that the passing to an MSP of a written note in those circumstances would not be caught by the definition of regulated lobbying. The information that the MSP is passed in that note would not need to be registered.

10:15  

If a person said something orally, that would constitute lobbying; if they wrote it down on a bit of paper and handed it to me, that would not count as lobbying.

Yes—technically, you are correct.

Thank you for that clarification.

You mentioned face-to-face communication. In the context that we are talking about, a telephone call would not count as lobbying. However, if someone held a Skype video conversation, would that be included?

Yes—I should have been clear about that. The 2016 act covers the use of videoconference facilities, which would include Skype or another form of videoconferencing.

The guidelines are very useful, because our roles and responsibilities mean that we require to meet to discuss and exchange views and opinions. That is very much part of our role. However, I would like some clarity on whether specific speeches may constitute regulated lobbying. There will be occasions on which speeches may fall into that category.

Yes, absolutely. The guidance includes a section that explains how speeches might be caught under the definition of regulated lobbying. At an event where someone from an organisation is giving a speech and seeking to inform or influence the audience by that means, MSPs, ministers or special advisers who are present would probably need to register that under the terms of the act as an instance of regulated lobbying. They would do so by identifying on the register those persons who were present and those to whom the speaker was directing their remarks. In that respect, it would constitute one information return under the 2016 act, which would spell out the purpose of the lobbying in the speech and record who had received that information.

Good morning, and thank you for the work that has been done in preparing for the implementation of the 2016 act. There are obviously some complexities and grey areas in the act, so it is hugely important that we have a clear document that helps people to navigate it.

I like the provision of a flowchart that allows people to go through some nice simple questions to help them to decide for themselves whether the activity that they are engaged in would be counted as regulated lobbying. However, I wonder why a slightly different form of words has been used in the flowchart in comparison with some of the other sections. For example, step 4 of the flowchart on page 13 states:

“I am paid by the organisation I lobbied for (or represent).”

Two pages earlier, on page 11, the guidance on step 4 states:

“you are a paid individual, representing the views of your organisation”.

Somebody who works for a supermarket might, in debating the regulations on plastic bags, want to express a view as an individual. However, as far as I understand it, if they are, as an individual, communicating a view on a policy issue on which the organisation that pays them has a view, it would, even if they are not paid to lobby, still count as regulated lobbying. Might the slight difference in wording, therefore, cause some confusion?

I note the difference in wording. I cannot immediately explain why there is a difference—it may simply be to accommodate a shorter phrase in the flowchart—but I will go back and examine it.

To answer your substantive question, I think that the example that you give would not oblige the individual concerned to engage with the lobbying register or to register anything, as long as they were not communicating on behalf of their employer but were simply offering a personal view. It is clear that the onus is on the organisation to register an account on the lobbying register and to take responsibility for communications that are made by its staff or other office-holders.

There is an exemption in the 2016 act for people engaging with those who are covered by the act—MSPs are obviously a critical constituency in that sense—when they are essentially communicating purely on their own behalf. If a paid employee of a supermarket happens to have views on a matter of public interest that obviously has a bearing on the business that their organisation is in, as long as they are not communicating on behalf of that organisation in that conversation, they are probably not engaged in regulated lobbying.

I will happily look at the slight difference in wording between the flowchart and other parts of the guidance, and we might make a minor adjustment there. However, I am pretty confident that, in the circumstances that you describe, the individual concerned would not need to register.

The issue also comes up on page 19, where it says:

“if you do so”

—that is, engage in lobbying communication—

“as an individual or employee ... in return for payment (of any kind) then you are required to register ... That is the position regardless of whether the payment itself relates to making lobbying communications.”

Again, the wording gives rise to that slight ambiguity. The first part of that paragraph suggests that if the lobbying communication is paid for, the person is required to register, but the second sentence says:

“That is the position regardless of whether the payment itself relates to making lobbying communications.”

Somebody who is paid by an organisation for other purposes—stacking shelves, administering the payroll or whatever, in the example of a supermarket employee—might find it difficult to interpret that wording.

Again, I am happy to look at that specific example. That part of the guidance intends to capture the fact that some individuals will need to register on the lobbying register because they are, in effect, sole traders who are engaged in consultant lobbying and are, in essence, operating on behalf of others.

That part of the guidance is trying to interpret and explain the fact that there is an exemption in the 2016 act for anyone who engages in lobbying in an unpaid capacity. That wording was meant to ensure that people such as unpaid board members of small charities would not be caught by the definition of regulated lobbying.

I see the point that you are making about that passage in the guidance. We can look to make sure that it is made clearer.

Thank you. I also want to ask about the journalism exemption. Most of us will be fairly clear about the everyday use of the word “journalism”, but would that cover, for example, a trade magazine for an organisation that itself was lobbying? MSPs who are speaking at a conference are often approached for a bit of blurb by a trade magazine that is promoting the conference. Would that be seen as communication on behalf of the organisation or would it be seen as journalism?

I think that that would depend on the facts and circumstances, and the lobbying register team stand ready to offer advice on specific examples. That exemption was clearly intended to exclude from registration the regular communication between politicians and others who are covered in the 2016 act, and journalists who are acting in their professional capacity as journalists.

We understand that there are organisations that have blurred the lines between journalism and other activities. When someone is communicating, they will need to be very clear about whether they are doing so for the purposes of journalism—that is, for something that they are going to write a news story about—in which case the exemption will apply, or whether they are engaging with the politician or other person for another purpose. If it is not clear that it is for the purpose of journalism, they may well need to register that communication.

So, the general advice would be to err on the side of caution and to register if you are uncertain.

Certainly, and we will be happy to explore with individuals or organisations any questions that they have about the distinction.

I should declare an interest, in that I am still a director of a lobbying company. That is in abeyance: it has not yet been struck off formally, but it is about to be. It is taking longer than we thought.

This is probably a simple question. Let us suppose that an MSP is at an event and an individual who is from a lobbying organisation, organisation A, or who is speaking on behalf of that lobbying organisation, says to the MSP, “I wanted to catch you briefly. Can we set up a meeting on behalf of my organisation with a view to discussing this issue?” That might be very brief, but it is an oral communication to organise a formal sit-down meeting, which would be registered. Would that initial discussion have to be registered, too?

As you have described it, that brief request to meet at a later date would not, I think, meet the test that we have set out in the flowchart that you have seen—with the five key steps as we have described them to help people to determine what is and is not regulated lobbying—on the basis that it is simply a communication that will lead to further engagement and communication. In that instance, at that stage, the organisation has not sought to inform or influence you in any way. There may, however, be an expectation that, when the more formal meeting takes place, that conversation will need to be registered.

Might that change, depending on how much information or background the person gave the MSP on the case concerned? They might offer some brief background and explain that the problem was regarding a certain organisation.

Possibly. You are right: there is a spectrum of how much information is relayed in that initial communication. If the person is asking the MSP to do something and to take some action in the interim, or to consider something as a result of that conversation, that might be regulated lobbying. If it is purely a matter of saying, “While I’ve got you for a couple of seconds, can we get a date in the diary?” that would certainly not constitute regulated lobbying.

I will ask about the constituency exemption, which I think came from a stage 3 amendment to the Lobbying (Scotland) Bill. Might that lead to a situation in which companies working across all constituencies end up being exempt from having to register any of their communication with MSPs?

That is one part of the 2016 act on which it is proving most challenging to produce guidance or advice. You are absolutely right: it was a stage 3 Government amendment that introduced the exemption. To explain, it would exempt from registration communications that are made to an MSP

“for the constituency or the region in which ... the person’s business is ordinarily carried on ... the person’s activity is ordinarily carried on, or ... the individual’s residence”

is situated.

That could lead to businesses or other organisations that have a nationwide presence potentially being exempt from registering communications to MSPs who represent the constituencies or regions concerned, regardless of the topic. I should be clear that the matter does not need to be focused on constituency-related business; it could be any matter.

There is an important exception to that: any such communication to a constituency or regional MSP who also happens to be a Scottish Government minister. Those communications need to be registered, and the exemption does not apply in that case.

The other important part of the exemption is that, if the person communicating is making their communication on behalf of a third party—if they are representing someone else—the exemption does not apply. It is quite complicated to explain and not entirely straightforward. We will have to wait and see. Experience will tell us what the consequences of the introduction of the amendment late in the day are likely to be.

Mr Harvie lodged an amendment to the amendment and it was debated at that time. We stand ready to provide advice on it. As you know, there is a statutory requirement to have a review of the act in two years and this is one of the areas that will need to be looked at carefully.

10:30  

My final question is about some of the press around the make-up of the working group. Do you want to comment on how you feel the working group is progressing?

My predecessor made a deliberate decision to form the working group to gather the views of a wide range of stakeholders who will have to engage with the act. It was therefore felt appropriate that we should look to have representatives from key sectors who would be able to offer a view on behalf of different organisations that will have to work with us to register their details. Business and third sector organisations are represented. Public relations and public affairs consultancies are there because they have a strong interest. There is also a pro-transparency campaigner.

We have tried to strike a balance to get views from all those who have a clear interest in making the act work in practice. They have been helpful in assisting us to prepare the documents that the committee has before it.

My question follows on from Patrick Harvie’s line of questioning. I hear what you are saying about the distinction between an employee having a conversation with an MSP by chance and somebody senior in an organisation.

I am not sure about the wording on page 19, under the heading “Communications not made in return for payment”. Paragraph 5 in particular might lead someone to believe that any employee receiving remuneration from a company and having a conversation is subject to the law. I am just suggesting that that technical point could do with clarifying.

The more general point is that there seems to be an assumption in this section of the guidance that someone is either an employee or a director—a junior person or a senior person. I would argue that, in a number of organisations, big and small, that is not always clear. We have talked about people working on shop counters compared with the managing directors of the supermarket. Where does a store manager lie in that? Store managers have responsibility for making communications, so are they liable?

In some organisations, the situation could be complicated. Even for small organisations, the middle tier of responsibility is a big grey area. What are your thoughts on that?

I take on board the concern that you raise. However, we are trying to make it clear for all those organisations that need to be aware of the requirements of the act who might be caught by the definition and who will be exempt.

We are following, in large part, the definition that is contained in the 2016 act. It references communications that are made in a role either as an employee—that would capture everyone from the shop floor to senior management—and then it mentions specifically

“director (including shadow director) or other office-holder, partner or member”.

That tries to capture the various roles that could be played by a person who might be engaged in regulated lobbying if they are operating on behalf of a partnership or perhaps another association or charitable organisation.

In many respects, we always have to refer back to the act, but the guidance is an attempt to put that into language that is easier to understand. The point on page 19 that Daniel Johnson has identified could be clearer, but it is very clear that individuals who are communicating on their own behalf, which includes coming to MSPs’ surgeries or coming to see them in Parliament, are exempt under the first exemption in the schedule to the act. Thereafter, some of the other exemptions that apply become a little more complicated. However, on that particular point, a communication that is made by an individual on their own behalf would be exempt and would not need to be registered.

I understand that, and I recognise that the guidance is work in progress, but I have a similar worry about the section on “Communications by small organisations”. I worry that there is an assumption that it will be clear when an organisation is small rather than large. Many partnerships are comprised of different legal entities, with the partners being partners in one entity and the employees being employed by a separate entity. What consideration has been given to how that issue will be dealt with?

Likewise, I slightly worry—indeed, there is probably a note of worry in the section—about whether there is a bit of a loophole for small organisations that are funded by other organisations. That might not necessarily be explicitly for lobbying purposes but it could nonetheless be used as a vehicle for that. Will the issue be kept actively under review to consider what entities and structures organisations might end up using?

In the familiarisation period, we are engaging with a lot of organisations that are coming to us to engage directly for the first time on the lobbying register and what they will have to submit when it goes live in March next year. As you would expect, we are finding that some organisations are established in a more complex manner than others, and we sometimes have to think carefully about what advice to give about who is obliged to register or who may be obliged to register what.

The small organisations exemption was an attempt by the Government to exclude from the requirement to register organisations with fewer than 10 full-time-equivalent employees while ensuring that that does not exempt organisations that are small in terms of employees and staff but which represent a wider membership. For example, business organisations, which may have a few core staff but a wider membership, were specifically quoted. That causes complexity. We have tried to be as clear as possible on what is meant by “representative”, but we are clear that, if an organisation is lobbying on behalf of a third party, it cannot rely on that particular exemption.

We will have to keep the matter under review. It is another part of the act that will be examined carefully in two years, based on experience. Hopefully, we will gain experience in the familiarisation period. In addition to the parliamentary guidance that is before the committee, we will produce information on frequently asked questions and common scenarios as they emerge, and we will keep that information updated. We hope to build on the body of knowledge and experience that we have so that people can interpret the act more easily.

My final question comes back to remuneration. The Federation of Small Businesses—sorry, but I should declare an interest in that I am a member of that organisation—has a particular worry because it has regional office-holders who receive a small payment for carrying out their roles. The payment is not necessarily directly for expenses although, historically, that is probably what it has been for. Their role is certainly not explicitly about lobbying, but that will form part of their activities albeit at a low or informal level. What conversations have been had and what thinking has been done on that specific point and on the more general point, if there is one?

On the exemption that relates to communications that are not made in return for payment, when you start to explore some of these issues, potential difficult situations arise, and I am aware of the one that you mention.

The 2016 act says that “payment” means

“payment of any kind, whether made directly or indirectly for making the communication”.

In that sense, someone might appear at face value to be an unpaid board member—a trustee, for example—and it might therefore appear that a communication that they make would not need to be registered. However, they might have to register a communication because they have, for example, received an honorarium or some other fee at some point.

We have asked and will continue to ask organisations to look closely at the payments that they make to office-holders in the organisation in order to check that. I should say that reimbursement for travel, subsistence or other expenses incurred would not be included. However, any payment beyond that might require them to register a communication that they have made.

Obviously, a couple of issues that have been raised might result in a tweak of the guidance. Do you know when you might be able to make a decision on that?

With your agreement, I would be happy to write to you during the week to give you details of what adjustment we might make in that regard. Thereafter, we hope that you will write to the Scottish Government in order to offer the draft guidance to the Scottish ministers for their consultation. When we have their response, we will reflect on any comments that they make, and that will lead us towards a final version of the guidance.

Okay. Thank you for your attendance at today’s meeting.

Does the committee agree to the process that has been set out, which involves us issuing parliamentary guidance to the Scottish ministers for formal consultation?

Members indicated agreement.