Standards Committee, 25 Apr 2001

Meeting date: Wednesday, April 25, 2001

Official Report 123KB pdf

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Lobbying

Our first item of business is our inquiry into lobbying. The clerks have prepared three issues papers. The first sets out the various policy options open to us and, by drawing on the evidence we received during the inquiry, summarises the advantages and disadvantages of each. The second paper provides some information on registration and regulation schemes in the US, Canada, Australia and the European Union. The third paper brings together some of the material we received which falls outside the remit of our inquiry but which may be of value to other bodies in the Parliament. For example, the evidence relating to the accessibility of the Parliament may be of use to the Procedures Committee's inquiry into the consultative steering group's principles. The paper asks us whether we are content to pass this evidence to the Procedures Committee, to the business team for the information of the Parliamentary Bureau and to the directorate of communications. Are members agreed?

Members indicated agreement.

I suggest that we now focus on the other two papers on possible policy options.

I shall try to start the ball rolling. The lobbygate inquiry gave rise to the general feeling that something should be done. At the very least, commercial lobbyists should be covered by a voluntary code of conduct, although I would not object if other colleagues felt that such a code should be extended to other lobbyists. I realise that there are objections to a voluntary code of conduct that covers everyone, but it is preferable to have one voluntary code instead of a large number of different codes, to ensure that matters are clear and out in the open.

Furthermore, registration would ensure that things were out in the open and that MSPs knew exactly who and what they were dealing with. That could be only a healthy development in a Parliament that prides itself on ready access, transparency and accountability.

Lord James, are you suggesting that there should be registration for commercial lobbyists?

Certainly for commercial lobbyists as an absolute minimum, although I would not oppose any suggestion by colleagues that it is absolutely necessary to go further than that.

I agree with Lord James. There should be registration of commercial lobbyists, public affairs companies, law companies with a public affairs role and indeed any organisation that is paid to represent clients. There is a difference between such commercial organisations and the voluntary sector organisations that have given evidence to us. I am not persuaded by the argument that the introduction of a registration scheme for commercial companies by the Scottish Parliament would somehow reduce the level of access for voluntary organisations and individuals who want to come to us. That has never been the aim of members of the Standards Committee. We have been committed from day one to ensuring that the Parliament is open and accessible to all and that there is no perception that some have greater access to the Parliament than others.

It is interesting that Patricia Ferguson, Lord James, you, convener, and I are present for this discussion, because much of our thinking was formed by the lobbygate inquiry that we were parachuted into in the Parliament's early days. We need to make progress on this issue. As I have said, my mind is quite clear that there is a difference between commercial companies that are paid to represent the interests of clients, and the voluntary sector and individuals. That is the distinction that we must make; and we must look to regulation and registration of commercial organisations.

Lord James talked about registration of commercial lobbyists, but you have gone one step further and mentioned regulation. I am a little confused about whether you are supportive and on the same track as Lord James, or whether you wish to go further.

As a minimum, we need registration. We also need a code of conduct for commercial and other organisations. That code, to which organisations should adhere, should be drawn up by the Parliament.

I understand that once organisations have gone through a registration system, the code would have to be policed in some way for it to be enforced, but that is another issue for us to examine. As I said, at the very least, we should consider registration.

We should be concerned about a number of issues.

I agree, more or less, with Tricia Marwick on what we should be doing about commercial lobbyists and the voluntary sector, but I remain slightly concerned about the definition of lobbying that we apply. I understand that the lobbying organisations have come up with a slightly different definition of that term than we might have. Perhaps we should consider that point further, as it is fundamental to the rest of the discussion.

I would like organisations to register, but since the beginning of our inquiry I have changed my mind about how heavy we should be with them. At this stage, I would like us to take a fairly light-handed approach to registration. I agree with Tricia Marwick about that.

I want to put on record my views, not only as the convener but as a member of the committee. We should consider registration of commercial lobbying organisations—people who lobby the Parliament and MSPs, for payment and for a third party—but I do not wish to go further than that. I am drawing an important distinction between commercial lobbying organisations and organisations that lobby on their own behalf. I am perfectly happy with what members have said about registration and a voluntary code of conduct, which, to be frank, should be for all lobbyists, but my personal view is that we should not go beyond that. We should take a light touch, as Patricia Ferguson said, bearing in mind the measures that we could have been discussing.

Convener, the phrase that you used highlighted why it is important to get the definition right. You mentioned those people who are paid to lobby the Parliament on behalf of their clients, but the lobbying organisations were of the opinion that they do not often lobby members of the Scottish Parliament. Rather, they advise their clients about the best way in which to do that. I am not sure that I agree with them 100 per cent, but we must get the definition straight. We must be careful, as we do not want to exclude people because of a loophole. That is why I mentioned the definition.

That is a helpful comment. We need a more clear-cut definition that encompasses commercial lobbyists.

I apologise for my late arrival. Based on what I have heard so far, I think that I am in broad agreement with all members of the committee.

I will repeat comments that I made during our previous discussion of this issue, which was held in private. We should focus on the problem, or the potential problem. Most of the evidence suggested that we are not being inundated with lobbyists who practise unscrupulously. That does not mean that we should not be on our guard, but we must put the scale of the problem into proportion. We should not try to set up a policing system, as the focus of our decision should be driven not by a few bad examples from Westminster's past but by greater transparency and openness. That approach raises a slight difficulty, as I am also in favour of a registration scheme. However, the difficulty that we came across in our evidence was that there are three types of lobbyist.

I do not think that the voluntary sector lobbyist and the professional or full-time lobbyist will have a problem accepting and endorsing any registration scheme that we come up with, but there seems to be a different group, who might be described as in-house lobbyists, who work for legal firms. We have a bit more work to do in that area, as the law firms—which are also lobbyists—treat their clients with full confidentiality. I am not worried so much about bad practice as about encouraging openness and ensuring that everyone is aware who is lobbying the Parliament and speaking to us. Our ability to catch out the bad apples will depend ultimately on MSPs' behaviour and on ensuring that we enforce our codes of conduct.

We must encourage the lobbyists to adopt greater transparency and openness, so that the public can understand who is speaking to us and how much money is being spent on lobbying for specific causes. The group that I mentioned will not fall neatly into any category and our task will be to work out how to capture them. It returns us to what Patricia Ferguson was talking about—the definition of lobbyists and their activities—and will probably involve our setting some sort of financial threshold. That would effectively be a test of their commercial involvement.

I agree with most of Ken Macintosh's remarks. We will have enough difficulty defining lobbying, and it would be extremely difficult for the committee to enter into a further discussion about commercial tests. It is clear in my mind—perhaps we should articulate it better—that there is a distinction to be made between those who access and lobby the Parliament as individuals and organisations and those who do so on behalf of clients or enable clients to influence the parliamentary process. We should register any organisation that takes money from a third party. There is a difference between those who work on behalf of a third party and those who have in-house parliamentary officers.

At previous meetings, we have talked about in-house parliamentary officers. If representatives of British Airways—which has a parliamentary officer—approach the Parliament's officials or MSPs, they say, "I am from BA" and give their name. The same goes for representatives of Shelter and similar organisations: we know immediately who they are. In future, they may choose to sign up to a voluntary code of conduct. However, there is a difference between those who are working for and paid by their own companies and those who are working on behalf of other companies and receiving remuneration for doing so. That is the clear dividing line that I am applying in my mind.

From the evidence that we have received, I know that the public affairs companies, lobbying consultancies and law firms run a mile from the word "lobbying". That is probably a bit of PR work on their own behalf, as they do not want to be tainted by what happened at Westminster and all the sleaze. They are trying to prove—in their minds, not in ours—that the activities that they are carrying out are not lobbying. We must embrace their concerns and define what we mean by lobbying, whether or not they accept that trying to influence the Parliament, although they are not speaking directly to MSPs, is lobbying. We must be very clear about what we mean by lobbying, which may not be their definition.

I hear what Tricia Marwick says and I appreciate that there is a distinction between in-house lobbyists and those who hire companies to do lobbying for them, but we should not treat them differently. British Airways is big enough to employ an in-house lobbying organisation or public relations operation and can lobby whenever it wants, but a smaller company has just as much right to lobby us on a commercial matter or on an issue in which it has a commercial interest as British Airways, even though it might not be big enough to support an in-house PR operation. There is nothing wrong with such a company employing a PR firm to lobby on its behalf. We should be clear that a company that employs a full-time professional lobbyist is neither better nor worse than one that has an in-house lobbyist.

The difficulty is that a firm that hires a firm of lobbyists or has an in-house lobbying department might not wish to register, as they think that they do not spend any time lobbying the Scottish Parliament. They might have a general contract with a lobbying firm to raise awareness of the company, for example. We should ensure that our net is wide enough to ensure that such companies are included in the register so that their activity in relation to the Parliament is known to us and to the public. This is where the matter becomes difficult. As the paper makes clear, if the qualifying criterion is that 20 per cent of a firm's activity must be spent on lobbying, many firms will claim that that does not include them. That is why we might be better off using a financial threshold and requiring companies to estimate how much money they spend on lobbying the Parliament, including spending on mailshots and somebody's time.

More work needs to be done on this area; it is not as simple as it might seem.

I understand that there is quite a distinction between the two sorts of organisation that you mention. I would prefer to move away from having a financial threshold because the in-house lobbying organisation of a company such as British Airways is solely concerned with that company. In my experience of lobbyists, it is quite clear which ones are from an in-house organisation. There is a distinct difference between that situation and one in which there is a firm that has been set up even partly for the purpose of lobbying for others for a fee. I think that there is a difference between the two.

I was going to say something similar, convener. We should draw a distinction between in-house lobbyists and people who are lobbying for a third party, although we should be clear about the fact that we still want to know who they are.

Kenneth Macintosh's proposal could lead to further difficulties, as the threshold is difficult to place regardless of whether it is a time threshold or a money threshold. It becomes particularly difficult to monitor such a threshold in relation to companies who have in-house lobbying departments. If someone is paying someone else to do a job, it is much easier to follow that through their accounts; if they are paying for a job from within their own resources, the expenditure is harder to define. Frankly, I do not mind whether the companies are spending £1 or £100,000; I want to know who they are and what they are doing. I want them all to be registered and I do not want there to be any threshold.

Are you talking about statutory registration or voluntary registration?

Statutory registration.

I agree with Patricia Ferguson that definitions should be clear and beyond doubt, as that makes enforceability much more straightforward.

We obviously want to catch cases where there is a definite commercial element. I agree with Patricia Ferguson that thresholds are too cumbersome and difficult to apply. Where there is a commercial element, it does not matter what the size of the company is. Those concerns should be caught by the provisions.

One of the advice papers touches on how to work up a voluntary code. It would be desirable to have further consultation and co-operation with umbrella organisations on moving to a voluntary code. It seems that the committee could give guidance on what the essential elements of a voluntary code should be. Although I think that I am correct in saying that we do not have the legal powers to enforce a voluntary code, if one were worked up we could give guidance. The clerks should draft proposals on that. The proposals could address whether guidance should include any elements relating to discipline and sanctions. If the umbrella organisations signed up to a voluntary code, it would carry much weight and would be generally accepted.

I think that it matters whether someone spends £1 or £100,000 on lobbying the Parliament. It does not matter whether the lobbyist is a professional lobbying company or an in-house lobbying group. We are all aware that there is a distinction between those who lobby with a commercial interest and others who lobby for different reasons.

There is nothing wrong with lobbying—there is nothing wrong with British Airways lobbying as long as it is clear and above board and everybody knows what is being done. The transparency argument is the most important. It is not about policing and catching wrongdoers and identifying different lobbying companies. Convener, you see a difference between an in-house lobbying group and a lobbying company that might act on behalf of different clients. I do not see a difficulty, so long as whoever is lobbying makes it clear on whose behalf they are lobbying. I have no problem with a professional company lobbying on behalf of several people so long as it makes it clear for whom it is working.

We want to encourage people looking at the Parliament to be aware of who is lobbying and how much money they are spending. We do not want to put people off: we just want to make people aware of the sums of money that are being spent on lobbying in certain areas. That is the sort of openness that we should encourage. A list of commercial lobbyists—the individuals who lobby for a living—does not take us anywhere. All it does is identify a group of people who lobby for a living. That may have the effect of saying that they are the professional lobbyists and encourage people to go to them if they want a good job, whereas we might wish to encourage people to lobby us directly.

I do not quite agree with where the committee is heading on this. I agree that there should be registration. It is important that the committee and the Parliament generally set a high standard here. Openness and transparency are principles on which the Parliament is founded. We should continue to lead the way for other Parliaments around the world—we are a different kind of Parliament, which conducts its affairs in public and openly for all to see. I am not sure that what is suggested is the right way to go.

I agree entirely that openness and transparency are extremely important—they are among the fundamental considerations. Kenneth Macintosh is right that there is nothing wrong with lobbying if it is done properly. It should be encouraged, as we want to know people's views—there are helpful organisations in both the voluntary and commercial sectors. We are all interested in transparency and openness and want to know who is lobbying. There is no difficulty with voluntary organisations that lobby for themselves because, in getting across their points of view, they want to identify their organisation to you. The difficulty arises with commercial operations, because they work for a third party. They lack transparency and openness, which worries committee members.

You are right about transparency. The lack of transparency in one instance triggered off our involvement in the issue. However, I think that we and Ken Macintosh are speaking at cross-purposes.

That is because I arrived late.

No, it is not. I think that we just misunderstood each other. Neither I nor anyone else is saying that we are not interested in how much is being spent. We are saying that we should not establish a minimum level at which bodies must register; if organisations spend any money lobbying members of the Parliament, they should have to register.

I am making this up as I go along, so my proposals are not written on stone tablets, but I hope that the register would include the name of the person or organisation that was lobbying, the organisation on behalf of which the lobbying was being conducted, the subject on which they were lobbying, who they were lobbying and how much they were spending to do that. I do not want a threshold to be set to register only those who spend more than £5,000, for example. I want everyone to be registered and I want to know how much is being spent.

That is interesting. I agree with the idea that everyone should be registered, but that returns us to the barrier argument that voluntary groups specifically raised with us.

We do not want to go off on a tangent. We have all agreed that we are focusing only on commercial organisations that lobby or interact for a third party.

That is why I disagree, because I do not consider that in-house companies lobby for a third party—they lobby on their own behalf. The distinction is false and will fail because many voluntary groups are, in a sense, professional lobbyists. The Scottish Council for Voluntary Organisations, which gave evidence, employs someone full time with pay to lobby Parliament. Would such a person be included in the category that you described?

No. There is confusion here. Such people are expressly excluded from our discussion. I am not sure whether you were present when we discussed that at the beginning of the meeting. We are focusing on organisations that lobby or interact with the Parliament on a commercial basis for a third party. Voluntary organisations that employ in-house staff are in a transparent situation. Those staff promote the organisation for which they work, and committee members are not concerned about that situation.

The SCVO is an umbrella organisation and lobbies on behalf of its member voluntary groups. It is the voluntary sector equivalent of a professional lobbying company.

I am fairly relaxed about the idea of registering organisations that lobby for themselves. We are considering two issues. The first is requiring commercial organisations that lobby the Parliament to register in the way that Patricia Ferguson described. Even though she made it up as she went along, she had some wise words.

We are also considering whether the Parliament should draw up a code of conduct to which other individuals and organisations such as the SCVO or voluntary groups might sign up if they wished. I was struck by the evidence from the Scottish Trades Union Congress that it would welcome such a code. We should not prevent people or organisations from saying, "We regularly lobby the Scottish Parliament. We will abide by the code of conduct. If we do bad things, let us know." There is a difference between the code of conduct to which we would expect most organisations to sign up and the registration process.

You put the position succinctly. We are considering two elements. I will summarise what was said, for clarity. We are considering registration for organisations that operate for a third party. If an organisation decided that it wanted to do that, it would fall under the umbrella for registration.

The added advantage of the code of conduct is that it would nail the myth that the Parliament is trying to create a two-tier system. It has been suggested that by registering commercial lobbying organisations we are somehow giving them an elite status that other organisations would not have and that by requiring commercial organisations to register we are implying that they have more influence than other groups that are not registered. The code of conduct that we draw up, to which anyone can sign up, will destroy that myth once and for all.

I hesitate to say that we are in agreement—I sympathise with what Tricia Marwick is saying and I agree with the intention. However, I have doubts about whether we are getting it right. The proposal assumes that we can divide everyone neatly into commercial lobbyists and others. I am not entirely convinced by that argument. Many voluntary sector organisations employ commercial lobbyists. Although a register of commercial lobbyists might be useful, what would be far more useful to me—and to other people—is a list of who is doing the lobbying. I am interested not in the lobbyists, but in the companies behind them. For those purposes, a list of commercial lobbyists is not satisfactory.

There are puzzled faces around the committee table because there seems to be a misunderstanding. That is precisely what we are suggesting.

Well—

Perhaps Patricia Ferguson could repeat her comments.

The registration would consist of: the name of the lobbying company or individual; the organisation on whose behalf they were lobbying; the subject on which they were lobbying; whether they were lobbying a particular category of MSPs—for example, they might be lobbying only members of the Social Justice Committee on the Housing (Scotland) Bill—and how much they were spending on behalf of their clients. That would cover a voluntary organisation that was employing a commercial lobbyist.

The distinction that we are trying to make is between the registration process for those groups and what would be appropriate for organisations such as the STUC that do everything themselves and would never in a month of Sundays have anything like the kind of money one would need to employ a lobbyist even for an hour—such organisations would be encouraged to sign up to the code of conduct. We all know who we can access in the STUC, who its members are and on whose behalf it would be lobbying. Similarly, we all know who the members of the SCVO are; we can find that out easily.

The Standards Committee has always proceeded on the basis of consensus. We are trying to ensure that everyone is on board.

I agree with everything that Patricia Ferguson has just said. I also appreciate the intentions behind the suggestion. I still have some reservations, but we can move forward on that basis.

A secretary of a charity writing to MSPs would not be covered, so there is a clear distinction in relation to the commercial element.

Indeed.

The legal advice that we were given was that the current remit would not allow us to

"develop specific proposals or become involved in the application and enforcement of either the statutory regulation of lobbyists or a voluntary code."

However, we can make recommendations for legislation or for parliamentary approval, so the arrangements that we propose would be subject to review. If any of Kenneth Macintosh's worries proved well-founded, the matter would come back to the committee and we could make appropriate recommendations in the event of any abuse.

Lord James is right in referring to the legal advice. A statutory registration process of a third party or a commercial lobbyist—however we want to define it—is outwith the remit of the committee. However, we can produce a report, which would be laid before Parliament. It is for Parliament to decide how to proceed, based on the recommendations of the committee. That is the appropriate route.

I suggest that we task the clerks to work towards producing a draft report for us, although—as the clerk has just reminded me—I should first ask whether we wish to take further oral evidence or proceed to a conclusion.

It will be necessary at a later stage to consult or take evidence on the form of the voluntary code. The umbrella organisations will want to input their views. We can decide on the form of that later.

We could task the clerks to start work on the draft report but—now that we know that we want to proceed down this route—we can invite organisations to give evidence to us on the format of a voluntary code, if that is what members want.

I would like us to consider the basic principles that the voluntary code should cover before we start discussing them with outside bodies.

I have just been getting some good advice from the clerks. At this stage, rather than producing a draft report, the clerks will draw up an issues paper for our consideration.

I have a further point about lobbying, although it is perhaps a side issue. I was struck by two things that were said in evidence. One was the comment made by the STUC, I think, that the task of giving evidence to and meeting members of the Parliament and the Executive was a welcome burden for an organisation of such a size and with such a financial capability. However, there must be organisations who find giving evidence even more of a burden than the STUC does, given that the STUC's membership is fairly skilled and professionally long in the tooth.

I also noticed that the state of New York has produced a citizens guide to lobbying, to help members of the public to get their thoughts and ideas across to politicians. I do not think that we want to produce a citizens guide to lobbying, as the word "lobbying" has become tarnished over recent months. However, we could ask the parliamentary authorities to consider providing a document with a similar aim but a more welcoming title. In our evidence taking, we found that accessibility has been welcomed but that we could do more to encourage it.

That is a good suggestion.

You mentioned the idea of publishing a guidance note for lobbying companies and for the voluntary sector. I assume that that will form part of the issues paper.

Absolutely—I am sure that we can also consider that. Are members content with the suggestions on how we should proceed? If so, we will task the clerks to proceed with an issues paper.

Members indicated agreement.