Lobbyists: how to lose friends and alienate people

When Altitude was being formed as a company and we were discussing a name for the company, I jokingly suggested that we call ourselves Bill Pottinger, so that we might accidentally be invited to tender for work. Had we gone down that route, perhaps the public affairs industry would have been spared the embarrassment poured upon it by the ‘sting’ that takes up the first seven pages of today’s Independent.

Under-cover journalists from something called the ‘Bureau of Investigative Journalism’ invited ten London firms (not including Altitude) to pitch to a (fictitious) Uzbek organisation to promote its supposed interests. And, according to today’s report, Bell Pottinger employees made some rather staggering – and rather foolish – claims pertaining to their personal influence over members of the Government and Downing Street staff.

A few points immediately spring to mind…

1. After so many attempts by the press to dirty the reputation of lobbying, they seem finally to have succeeded in including some actual lobbyists in the story. Not fictitious ones acted by journalists to catch out politicians, nor businessmen with an interest in swaying political decisions but with nothing to do with the public affairs industry. No, this time they have actually caught out some real lobbyists. Well done the Independent – you’re the first paper to at least identify some lobbyists!

2. Let’s just re-read part of that story. Ten firms were approached for the fictitious work for the fictitious Uzbeks. Of those, two refused the work and three didn’t respond. Of the other four firms, there is no mention. Could it be that they – whisper it – acted ethically? Given the apparently scurrilous nature of the entire public affairs world, surely this is the newsworthy element!

3. And while I’m on that subject: I’ve written here before about how journalists are desperate to find a group in society on which to shift the focus of public disgust from the press itself. Yesterday, the Independent gave a curiously large amount of space to the establishment of The Journalism Foundation. The paper’s editor, Simon Kelner wrote:

“Journalism itself has had a bad press recently: here is a positive initiative that seeks to redress the balance and, whatever you may think when following the latest developments from the Leveson Inquiry, it’s in all our interests that, if nothing else, we keep monitoring those centres of power.”

Quite right too, Simon. Mud has been thrown and it has stuck, even on the holier-than-thou Indy, whose owner and financial backer, we discover in Kelner’s last paragraph (by which most people have stopped reading), are the founders of the Journalism Foundation.

Lo and behold, the day after the fanfare about this cuddly new Foundation – a new knight in shining armour to salvage the reputation of the press – we have an attempt to demonise the public affairs industry. Which compels me to quote Kelner again:

“…this skulduggery was practised only by a small minority, and one of the prices to be paid for having our vibrant and diverse press is occasional unruliness born of competition.”

He is referring, of course, to the press, not to the public affairs industry, which his newspaper today smeared with one broad brush. That’s a smart line in hypocrisy.

4. Some people – especially some of those who have worked within the circles of power but then faded away and perhaps feel resentment – really cannot help but boast in order to make themselves feel better about themselves. It happened before and it will happen again – it’s the frailty of the human ego. That doesn’t make the claims true.

5. The vast majority of the public affairs industry – represented in this instance by the unidentified firms that did NOT want to work for the shady outfit cobbled together for the Indy’s sting – whether members of industry associations or not, have long called for a regulatory code. This is because they have nothing to hide and want their industry respected for the legitimate role it plays in informing government policy.

It will be interesting to see how this story plays out. By 8.15am today, Twitter was flushed with comments on why this story wasn’t gaining more coverage on the BBC. I’m starting to hope that it escalates and is addressed at the highest levels because now that actual lobbyists are involved, it cannot be ignored.

Previously, I’ve defended my industry in the belief, gained through more than a decade’s experience in it, that the many, many people I’ve worked with are representative of the industry as a whole: honest, decent people who are open in their methods and who help their clients to open doors with their messages and arguments rather than their black books. Regretfully, I was wrong.

Let’s have a proper review of the industry, looking at how the bad apples may have smeared the reputation of the rest of public affairs (if, indeed, any actual wrong-doing took place). Without such a review or inquiry, it seems that the industry is destined to death by a thousand cuts, mainly inflicted by journalists trying to lift themselves from the bottom rung of the public’s ladder of disdain.

Autumn statement gives Lib Dems seven-year itch

George Osborne’s autumn statement generated a lot of discussion about its economic implications, with much gloom and foreboding. But it will also have significant implications for the politics of the coalition, particularly for the Liberal Democrats.

The coalition was founded on the basis of a fixed five-year term. It was coupled with a five-year economic strategy that would see the elimination of the UK’s structural deficit in time for an election in 2015. This all seemed like neat political and economic symmetry.

The Conservative Party took a deep breath and gave up the notion of governing on its own. The Liberal Democrats, grateful for their first experience of power in 90 years, clutched their garlic and joined forces with a political party whom many regarded as bitter enemies.

It would be a rough ride at times, as the Liberal Democrats found out over tuition fees, but it would be a five-year project at the end of which the two parties would go their separate ways and face the electorate.

But now the structural deficit will be with us until 2017. Thus, we now have a five-year coalition pursuing a seven-year economic strategy. The coalition parties cannot now plan to go to the country separately in 2015 claiming to have balanced the books. Treasury Chief Secretary and Lib Dem strategist, Danny Alexander, clearly grasps this, but his acknowledgement of the changed political dynamic is bringing out other Lib Dems in a rash.

Alexander appeared on BBC 2’s Newsnight following the autumn statement and said that the Liberal Democrats would fight the next election committed to the additional £15 billion of cuts in 2016 and 2017 that they had agreed with their Conservative coalition partners.

He said: “As a government we originally set out plans that would meet our targets a year early in 2014/15. But because of the way that economic circumstances have deteriorated we need to make this commitment for future years, so yes Liberal Democrats and Conservatives will work together in government to set out plans for those following two years and, of course, we will both be committed to delivering them.”

This caused consternation among some of his Lib Dem colleagues who are wary of being too closely allied to the Conservative Party. They are anxious to preserve their party’s independence and to go into the next election on a manifesto that is distinct and separate from the Conservatives.

We are all adjusting to coalition politics. All that Danny Alexander’s comments show is that he has adjusted better than some of his Lib Dem colleagues. It will be extremely difficult, not to say, implausible, for the Lib Dems to support an economic strategy that runs into the next Parliament, but cease to support it on the day that the next election is called.

As they enter the next election, both coalition parties will have to claim that their partnership has been a success. Having trumpeted the success of the coalition and tied it to an economic policy that will still have another two years to run, it will require fairly tortuous logic to tell the electorate that it must come to an end.

I wouldn’t bet against the next election producing another hung Parliament and another coalition. So Danny Alexander may well have put down a useful hedge that he can cash when negotiations for the next coalition open.

Of course both parties will stand on separate manifestos and fight their own election campaigns. We are some way from a repeat of Lloyd George’s and Bonar Law’s “coupon” election of 1918, when candidates who had the official support of the coalition were issued with letters of endorsement. But if we have entered a period of hung parliaments and coalitions, Danny Alexander will appear more astute than some of his Lib Dem colleagues are giving him credit for. The prospect of another five years in power could provide the balm to cure their itches.

Boris throws a FIT

David Cameron must getting used to being sniped at by erstwhile allies. His Liberal Democrat coalition partners have made regular show of objecting to their own government’s plans on the NHS, tuition fees, repatriation of powers from the EU.

I suppose that comes with being in coalition. The junior partner will genuinely take a different view in some policy areas. It will also be looking to the next election and will feel the need to do something to preserve its vote. What better way than to set position yourself against particular policies, particularly if they are controversial.

This has also been Boris Johnson’s approach, almost since the moment he was first chosen as the Conservative Party candidate for London Mayor in September 2007. David Cameron, his nominal leader, acknowledged this when he launched his first mayoral election campaign, saying: “I don’t always agree with him, but I respect the fact that he’s absolutely his own man.”

Whether it was suggesting a one-off amnesty for illegal immigrants or proposing a new airport in the Thames estuary to replace Heathrow, Johnson has frequently pursued his own unique policy lines. Some issues, like the future of Heathrow are a legitimate concern of the Mayor. Others, like the UK’s approach to the EU are, to say the least, stretching it a bit.

This week, he has been at it again. In a letter to the Chancellor that somehow found its way into the press, he threw a hissy fit (or is that a hissy FIT?) and attacked the Government’s decision to halve the feed-in tariff (FIT) for solar photovoltaic electricity. He argued that this will “slowly suffocate the growth that this policy has so far encouraged.” In his letter, he writes that “While the government will argue that the costs of solar panels have reduced, the costs of inverters, stands and labour have not.”

Boris Johnson’s intervention comes on the eve of a Labour Party opposition day debate on support for the solar industry in the Commons on Wednesday and a mass rally in Parliament today. Ministers will come under pressure to justify the cuts to FITs. The solar power sector will find some relief that such a senior figure in the Conservative Party is taking its side and not just the Labour opposition.

Of course, Johnson is facing London’s voters in just over five months, and is looking for ways to portray himself as not the Government’s candidate. It will be tempting to take a cynical view Johnson’s support for solar power subsidy, but right now the industry needs all the support it can find.

Johnson may also be looking to elections much further in the future that would give him power over more than just bendy buses and pay-as-you-go bicycles. The trick for the industry is to keep his support over the long-term, that is, if it survives that long.

No “boom and bust” for solar industry?

The previous Labour Government was memorably accused of failing to fix the roof while the sun shone. The solar industry might be thinking the same of the present government, which the Prime Minister asserted would be “the greenest ever”.

Recent government announcements show that support for some renewable energies, such as offshore wind, wave and anaerobic digestion, is being maintained.  In contrast, that for solar photovoltaic is being cut drastically, which was expected, and being cut precipitately, which few expected. The feed-in tariff for small domestic solar PV installations is to be cut by more than half from 12 December.

In announcing this decision, energy minister, Greg Barker, said that “Boom and bust for solar must be avoided”. This is a phrase we have heard before and Barker must be hoping that it doesn’t come to haunt him as it did Gordon Brown.

The growth in solar PV has been dramatic. The generating capacity of solar photovoltaic installations has increased dramatically from 23 MW in 2008 to more than 400 MW from 100,000 individual installations by September this year. Yet it needs to be remembered that despite this dramatic growth solar PV accounted for just half of one percent of the electricity generated by renewable means. That is a tiny proportion of our electricity needs, yet the growth of the solar PV sector has all but exhausted the budget for feed-in tariffs.

The Government claims by cutting the feed-in tariff it will save households £23 on their annual electricity bill by 2020. It also says that industry costs are falling. The cost of an installation in April this year was £13,000, but now it is down to £9,000. Under these circumstances there is no longer a need for such a generous subsidy.

The trouble for the solar PV industry is that, at least up to now, it makes such a small contribution to total electricity generation. This means that were it to collapse, the impact on supply would be negligible. But political considerations are also counting against it. Ministers will be acutely aware of the need to address consumers’ bills, especially for energy. They will have asked themselves why upwards of 20 million households should pay extra on their electricity bills for the benefit of just over 100,000 households who are able to put up around £10,000 to install solar panels on their roofs.

Last week the British Photovoltaic Association held a reception in the House of Commons. Greg Barker was a, perhaps diplomatic, no-show. In his absence, the Department for Energy and Climate Change sent a senior official to deliver a pretty blunt message to the industry that the party is over. He said that the problem is that the rate of installation is unsustainable. In October alone there was a new peak of 4,216 installations with 15 MW capacity.

As he so deftly put it: “This is a problem in a fiscally constrained environment.” And although the Government is consulting, he said that the industry needs to plan on the basis that the “decisions” outlined in the consultation will go ahead.

Some figures in the industry are threatening legal action over the Government’s decision. This will not surprise ministers and they seem determined to press ahead regardless, confident that they will prevail. But the industry needs to do more than just shout “No!” Legal action is not a substitute for coherent, thought-through and practical policy proposals. The solar industry needs to look beyond open-ended generous subsidies and find other policy proposals that can support the solar industry’s growth. That is the best way to avoid bust following boom.

In praise of special advisers

Special advisers have never exactly been viewed with affection. In the first episode of Yes Minister, Jim Hacker arrives in the Department for Administrative Affairs for the first time accompanied by his special adviser, but before they even reach his office, the adviser is bundled off unceremoniously into a cupboard. Oh, how we laughed.

We also laughed long and hard at the absurdities of Malcolm Tucker et al in The Thick of It. As a former special adviser myself across six different Whitehall departments I thought it was hilarious. On occasions, some of the scenarios were eerily familiar in spirit, if not in fact.

Of course, the truth is much more mundane. Real special advisers are not out of central casting, nor are they all in the mould of Alistair Campbell, Charlie Whelan or Andy Coulson. Clare Short, who had two special advisers of her own, famously described them as the “people who live in the dark”. I took that as a compliment, as special advisers should usually be invisible to the public.

But they also are serious and conscientious providers of political, policy and communications support to ministers. And with the exception of the occasional Sir Humphrey, they are welcomed by civil servants. They are a valuable means for handling the more overtly political aspects of modern government and can help guide, though not instruct, civil servants on a minister’s thinking. As Sir John Elvidge former permanent secretary of the Scottish Executive, quoted in Civil Service Live Network, put it: “special advisers who genuinely know the minds of their ministers – rather than those who ascribe their own thoughts to a minister – are invaluable, because ministerial time is one of the scarcest commodities.”

The origins of the special adviser role are opaque but arguably started to take form during Harold Wilson’s first premiership in the 1960s. He appointed Marcia Williams as his political secretary and complained later how the civil servants tried to marginalise her and keep her in an office far from his. No wonder she was rumoured to have been a source for some of the scenes from Yes Minister. He also sought independent advice on the economy from two Hungarian émigrés, Nicholas Kaldor and Tommy Balogh – referred to unaffectionately by civil servants at the time as Buda and Pest.

Gradually the use of special advisers became more established with codes of conduct and formal appointment as temporary civil servants. Their numbers grew steadily under the Major, Blair and Brown premierships. Although there was some carping at this, they are now a fact of political life.

David Cameron pledged opportunistically to reduce the number of special advisers but now that he is in government he may appreciate that they have their uses after all. He has now had to face this reality and sanction the appointment of an additional seven to serve junior Liberal Democrat ministers. This is another evolution, as previously they only served Cabinet ministers.

Perhaps now we can have a more mature discussion on the role and number of special advisers. If No 10 had had a stronger team of political and policy advisers, it might have avoided some of the damaging retreats and uncertainties on issues like NHS reform, sentencing policy and the stewardship of public forests. We may be a long way from the US where an incoming President brings in a top echelon of 2,000 appointees to run the government, but our system of government and policy making might just benefit from a little more light being shed on its inner workings.

Social care reform – the next great health debate?

Amid the furore surrounding the Government’s legislation on NHS reform, the wheels have slowly been turning on reform in the social care sector.

At last week’s seminar on the future of social care held at The Care Show in London, the chief executive of the English Community Care Association, Martin Green, said that engaging with government policy makers had never been more important. Peter Hay, President of the Association of Directors of Adult Social Services, and a member of the Department of Health’s listening exercise, NHS Future Forum echoed that sentiment.

It is no wonder that leading figures in social care are urging organisations and the wider public to engage. Social care is under huge strain and faces potentially huge changes in policy, particularly on funding and care home regulation.

The Dilnot Commission on the funding of social care has reported and its findings are being digested within the Department of Health. Local authority funding of social care was already being squeezed, but following the Budget, this is now being done with thumbscrews.

The sorry saga of the collapse of Southern Cross, in part a consequence of reduced local authority funding, has tainted politicians’ perceptions of care home providers. It has also prompted the House of Commons Health Select Committee to widen its inquiry into social care to examine the regulation of care homes in addition to future funding and personalisation. It will look into how to protect against the consequences of operators going bust, and we can expect some very public grilling of care home providers over the coming months.

The DoH published a discussion paper last week on the regulation of the social care market. It examines issues surrounding the risk of financial failure of large care home operators.

There is no guarantee that every care home will always remain open. Nor is the DoH looking to protect care home businesses. There will be no “moral hazard” of the sort that surrounds banks. If a care home operator becomes unviable as a business, it will ultimately be allowed to fail.

What the DH is groping for is a system that will help prevent failures like that of Southern Cross and allow for the orderly transition of care homes to new operators. It is looking for feedback on suggestions such as tougher regulation, more rigorous financial checks, or requiring operators to post bonds to cover for financial failure.

This is just to scratch the surface; the options for reform could reach into every aspect of social care and there is no shortage of contentious issues. Just when the Government gets its NHS reforms enacted (or ditched?), it will set itself up for another round of reform, policy proposals and, no doubt some heavy-duty controversy along the way.

There will be some serious policy boxing over the coming months, with round one commencing with publication of the social care White Paper next spring. Anyone with an interest in the future of social care should answer the calls to engage. Let’s just hope that the ring is big enough to hold us all.

Political scandal? Time to kick the dog again…

Last year I blogged about lobbying, pointing out how the poor old lobbyist seems to be the end of the easy target in a political crisis, the dog that politicians and media go home and kick at the end of a bad day.

It seems that history is repeating itself and, once again, a lazy shortcut down the path to an unpopular but misunderstood cohort of practitioners of the supposedly ‘dark arts’ of lobbying is once again being beaten.

The scandal of Liam Fox’s friend Adam Werrity has predictably resulted in a call for tighter restrictions and regulations on lobbyists. This case is very similar to last year’s case on which I blogged – insofar as it hasn’t actually involved a bona fide lobbyist!

Proposals for a statutory register of lobbyists have long been supported within the public affairs industry, mainly because the industry has nothing to hide. In the recent case, it was Adam Werritty, who must surely have had no doubt that what he was doing was not wholly ethical or above board. In other words, he did have something to hide.

Being neither a lobbyist or in a position where he would have wanted to publicise his dubious activities, how on earth would a register of lobbyists have made a difference? Werritty would not have been required to be on the register – he’s not a lobbyist, he’s just a chancer of a businessman who abused the position of a friend. And even if he were a lobbyist it is unlikely that he would (a) register himself and put himself up for scrutiny or (b) given his clear lack of moral or ethical compunction, be swayed by any statutory requirement to register.

But once again, the whole saga provides two of the most abhorred sections of society – politicians and journalists – to take the moral high ground and kick the lobbying dog. Never let the facts get in the way of a good story, eh?

Justice is justice, whatever the political climate

One of the Altitude directors recently came across the Labour Party’s 1990 policy programme and searched for the party’s policy on Cyprus:

“Labour believes that Turkish troops must withdraw from the island and that Cyprus should be reunited on a federal basis which restores the unity of the island with full safeguards for the Turkish minority.

“A Labour government, as one of the guarantor powers, will use its influence at the United Nations and elsewhere to help bring this about. Meanwhile, Britain should not agree to Turkish membership of the European Community.”

An easy bit of internet searching brought up the Conservative manifesto pledge on Cyprus from 1992, which reads:

“We seek a solution to the dispute which has divided Cyprus since 1974. A settlement must recognise that Cyprus is indivisible and that the rights of both communities must be assured. We will support the UN’s efforts to secure a fair and lasting solution.”

Of course, we now view things in the context of a world changed by the horrors of 11 September 2001 but should our principles as an international force really have changed so much to have diluted these stances down to what is now essentially a state of political ambivalence on Cyprus?

I think not. Justice is justice, and we should seek to impose it constantly and without wavering. Tell your MP.

From zero emissions to zero debate

The irony of the 2010 General Election campaign is that it is the most unpredictable for a generation, yet there has been little serious policy debate apart from on the financial crisis and National Insurance. Even the arch spin doctor, Alastair Campbell, is calling for more media coverage of policy.

There has been massive interest in the leaders’ debates, which has blown away all the early predictions of the likely result. It has also nullified the parties’ best efforts to devote discussion to specific policy areas on particular days.

So it should come as no surprise that polling by Ipsos Mori should show that, for the first time since 1987 (when the question was first asked), party leaders are as important as policies in deciding voters’ choice of party. The gap in favour of policies over leaders widened from 1997 to 2005, but narrowed dramatically by summer 2008 and is now level.

I know it’s the economy, stupid, so it is entirely appropriate for the level of public borrowing and the fragile nature of the economic recovery to dominate what little policy discussion there is. But there has been virtually no discussion of other issues such as transport, crime, health or education, education, education.

Does anyone recall being told that tackling climate change was the number one issue facing, not just the country, but the whole world? True, this and the related issue of future energy supplies, came up in last night’s leaders’ debate. But there has otherwise been virtually no mention of the subject.

The Guardian did at least host a debate between Energy Secretary, Ed Miliband and his Conservative and Liberal Democrat shadows, Greg Clark and Simon Hughes. After 36 hours, the paper’s online report had attracted 52 comments. By contrast, just one of its comment articles on last night’s leaders’ debate received 281 comments in half that time.

There is no shortage of policy or initiatives on energy, climate change or reducing carbon emissions. We are told that so-called green industries have the potential to create up to half a million jobs. Yesterday, I attended the 2010 Sustainability Live exhibition in the National Exhibition Centre in Birmingham. This brought together hundreds of exhibitors, from renewable energy equipment manufacturers to sustainable waste disposal and water treatment specialists, university research departments, trade associations and professional bodies.

There is huge commercial and academic interest in developing the means to reduce harmful emissions, and to develop a more sustainable economy based on innovative and more secure energy supplies. Yet none of the exhibitors that I spoke to were aware of any discussion in the election campaign that is relevant to this burgeoning sector.

When it comes to climate change, we seem to have gone from zero emissions to zero debate. There will, eventually, be plenty of discussion on the policies that the new Government should pursue, but not till after the election.

X Factor politics, Hammer Horror policies

I attended a Conservative Party business event this morning, addressed by David Cameron. It was billed as Supporting Small Business and Building the Big Society. Unfortunately, the clamour from the media throng for his answer to the X Factor-like surge from the Liberal Democrats, meant that there was precious little space for him to say much about business.

But beyond the brouhaha surrounding National Insurance Contributions, you will learn little from the media on what each of the parties are offering business. The curse of reality TV politics, is that there is now even less space for policy debate in any area, let alone on business issues.

True, David Cameron did mention cutting Corporation Tax and exempting new businesses from paying National Insurance on the first 10 new jobs. But it was hard to get away from hung parliaments and attitudes to Nick Clegg.

Each of the parties has dedicated sections in their manifestos and websites on policies for business. The Conservatives will reduce red tape and form filling, simplify business taxes and make rates relief automatic for small business. Labour’s proposals include cutting regulatory costs, doubling the capital gains allowable under Entrepreneur’s Relief and temporarily increasing small business rate relief. Like the two main parties, the Liberal Democrats say that they will remove unnecessary regulations. They will also establish local enterprise funds, stimulate bank lending to business and part-privatise the Royal Mail.

As with manifestos as a whole, the wording can often be couched in such general terms that the promises can, sometimes, mean anything to anyone. People running businesses will make their own judgements on which party they would prefer in power. But regardless of which party wins, scrutinising manifestos will not be enough for business to ensure that the new Government implements policies that enable them to flourish. Businesses, whether individually or through trade associations, will need to engage with policy makers as soon as possible after the election. The purpose is not just to anticipate policy but to try and shape it before it is finalised.

Forecasting the election result has now got a lot more complicated. We may even be facing the prospect of a hung Parliament, with either a minority Government or a coalition. In these circumstances, and especially in the latter, manifestos go out the window to be replaced by policy programmes based on political horse-trading.

Businesses, as well as the financial markets, don’t like uncertainty. But post-election uncertainty is also an opportunity for business to exert its influence on future policy. But they must engage proactively with policy makers, be they ministers, advisers or officials if they want to see a policy mix that enables British business to thrive and expand. Failure to do so could result in the X Factor politics being generated by the leaders’ television debates, producing a Hammer Horror for business.