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Cabinet Office: Standards-setting Bodies

Part of the debate – in the House of Lords at 12:34 pm on 29th March 2007.

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Photo of Lord de Mauley Lord de Mauley Deputy Chief Whip, Whips, Shadow Minister, Trade & Industry 12:34 pm, 29th March 2007

My Lords, I thank and congratulate my noble friend Lord Norton of Louth on initiating this very timely debate. It is odd that our practice is not to address academics in this House as learned; in my view there are few noble Lords more deserving of that appellation than my noble friend.

My noble friend wishes to call attention to the case for putting standards-setting bodies falling within the responsibility of the Cabinet Office on a statutory footing. The fact is that none of the public bodies for which the Cabinet Office has direct responsibility is established on a statutory footing. While this situation persists, board members of the very bodies which exist to call Ministers to account will be appointed by those same Ministers. I am sure that your Lordships would all be grateful to the Minister for his views on the appropriateness of this fact.

My noble friend has explained that this is as much about being seen to be independent, as about being independent. According to the Cabinet Office, advisory non-departmental public bodies are,

"ideally suited in areas where the Government needs independent, expert, ongoing, relatively low cost advice on a defined issue".

Ministers are answerable to Parliament about advisory NDPBs and have the power to wind them up. Appointees are required to be independent of government, yet they are appointed by Ministers. These facts underline the importance that they are not only independent but are seen to be independent.

My noble friend has spoken about five advisory, or non-statutory, NDPBs which are responsible for setting standards. The first of these is the Advisory Committee on Business Appointments, which provides advice to the Prime Minister on applications from the most senior members of the Civil Service and Armed Forces who wish to take up outside appointments within two years of leaving Crown Service. Similarly, the committee provides advice to the Foreign Secretary on applications from senior members of the Diplomatic Service. The committee also offers advice direct to former Ministers if they wish to accept employment outside government. The powers of the committee have come into question as recently as this month following the suggestion that a former Minister who served in that capacity until May 2005 accepted a position at a lobbying firm in apparent contravention of the ministerial code.

The second body which is both non-statutory and sets standards, the Commissioner for Public Appointments, was set up in 1995 following a series of recommendations from the Nolan committee intended to increase public confidence in the way in which appointments to quangos were made. The principal recommendation was that an independent commissioner should be appointed, whose role was to be the establishment of a code of practice for ministerial appointments to public bodies, and the monitoring of the process to ensure that those appointments are made on merit after fair and open competition.

The commissioner's code of practice covers all ministerial appointments to the boards of executive and advisory non-departmental public bodies, NHS bodies, public corporations, nationalised industries and utility regulators. As my noble friend said, the commissioner's Scottish equivalent is established under statute, so questioning any argument that the one south of the Border should not be.

The third such body is the Civil Service Commission, an independent body sponsored by the Corporate Development Group. It hears appeals from civil servants against matters such as dismissal, refusal to allow participation in political activities and forfeiture of superannuation. The noble Lord, Lord Goodhart, referred to the background of a possible Civil Service Bill, which noble Lords on all sides have been demanding of the Government for some time.

The fourth such body, the Committee on Standards in Public Life, was set up in 1994 with the terms of reference that the noble Lord, Lord Neill of Bladen, quoted. On 12 November 1997, the new Prime Minister extended the terms of reference as follows:

"To review issues in relation to the funding of political parties, and to make recommendations as to any changes in present arrangements".

This month, Sir Alistair Graham, the committee's outgoing chairman, wrote to the Cabinet Secretary about the Prime Minister's decision not to renew his appointment when his current term as chairman expires on 25 April this year. Sir Alistair raised concerns about the appointment of his successor, saying:

"I am extremely concerned that, despite raising this issue with you on a regular basis since September 2006, no arrangements have been put in place to appoint my successor. As you are aware, under public appointments rules, this will require an open competition, which even if started now, would take some months to complete, and then further delay is likely depending on the availability of the successful candidate".

He went on to say:

"This risks the perception, unfair or otherwise, that this Government places a low priority on the maintenance of the highest standards of conduct in public life".

While one can appreciate the plea of the noble Lord, Lord Neill of Bladen, for retaining the pragmatic approach, it is perhaps this sort of development which shifts the emphasis towards at least a serious consideration of the statutory route. Sir Alistair's letter was raised in the context of an Oral Question in your Lordships' House on Tuesday, to which my noble friend referred. I should like to return to it briefly today. When I asked the Minister what his reaction was to their statement, he first said that,

"any such criticism would be unfair".

As Sir Alistair made clear, whether it was fair or unfair criticism was not the point. It is as much about the perception. It is, once again, about being seen to be, as well as being, independent. The Minister went on to say, in response to my question on Tuesday:

"However, we would certainly be open to criticism ... if the Government were to ... take decisions about the future before the Select Committee had produced its recommendations".—[Hansard, 27/3/07; col. 1557.]

I find that a non-sequitur. If one were to take that line on all senior public appointments where a Select Committee was deliberating on a related issue, we would be in a state of complete paralysis—that is unless reports, so far denied by the Government, that the future of the Committee on Standards in Public Life is itself under consideration are true. I am sure that the Minister will be grateful that he has another chance to answer my question today.

The last, but not the least, of the non-statutory standards-setting bodies is the House of Lords Appointments Commission. Much has been said about it in recent months and my noble friend Lord Norton and the noble Lord, Lord Goodhart, spoke about it today. As my noble friend said, we would all benefit from clarity, for example on whether its remit includes vetting the Prime Minister's resignation honours. In view of the clear likelihood that this will become topical in the next few months, the Minister will no doubt tell us what is proposed.

As several noble Lords mentioned, the Public Administration Select Committee in the other place is currently inquiring into the role and independence of the ethical regulators of government, particularly those established through ministerial powers. It will provide,

"a stocktake of the ethical regulation of Government, and will explore whether there are improvements that can be made to the present arrangements".

It raised some important questions at the outset of its inquiry, including whether it is necessary for these bodies to be seen to be independent by having a physical separation from government; and, indeed, whether it is possible for them to be genuinely independent while reliant for pay and rations on the Government whose activities they are required to regulate.

The inquiry will include examination of the non-statutory standards-setting bodies for which the Cabinet Office has responsibility and its conclusion will be an important contribution to the debate generally on this subject. Can the Minister therefore kindly assure noble Lords that the Government will give serious consideration to the committee's recommendations and take them fully into account?

There are some fundamental points which we may expect the committee to make, and they include the following. The first, as my noble friend emphasised, is that the bodies in question must be, and must be seen to be, independent of the Executive arm of government. This assumes an ever greater importance as the Executive arm becomes seemingly increasingly distrusted by the public. The noble Lord, Lord Maclennan, referred to concerns that the whole system might become tarred with the same brush. Secondly, and closely related to the importance of their independence, is the bodies' accountability, logically to the public through Parliament, perhaps in a similar way to the Comptroller and Auditor-General.

Thirdly, as my noble friend also mentioned, transparency is crucial in addressing those aspects. By that we mean transparency in their reporting and their more general openness and receptiveness to public scrutiny. Good indicators of this would be through regular, full, clear and accurate reporting to Parliament, and thereby the public, subject to standards and levels of disclosure stipulated in statute and subject also to independent verification. Lastly, they must have clear and simple structures and properly cover the relevant concerns. As we know, the Public Administration Select Committee is including among its considerations whether the current, often overlapping structures should be reorganised to do this more effectively.