Lobbying: a ticking timebomb?

Ticking timebomb: The practice of corporations influencing politicians behind closed doors 'has tainted our politics for too long', says David Cameron Looking up: Prime Minister David Cameron
In February last year, David Cameron gave a speech in which he warned of the next scandal likely to hit Britain. It would centre on what he referred to as "secret corporate lobbying".

The practice of corporations influencing politicians behind closed doors "has tainted our politics for too long", he told an audience at the University of East London. "We all know how it works. The lunches, the hospitality, the quiet word in your ear, the ex-ministers and ex-advisers for hire, helping big business find the right way to get its way. In this party, we believe in competition, not cronyism."

Connoisseurs of irony will enjoy reheating Cameron's words this week. His Defence Secretary, Dr Liam Fox, is facing questions over his relationship with his "adviser", Adam Werritty, who is accused of being a paid lobbyist. The intriguing affair - the "corporate intelligence" company, the businessmen with vested foreign interests, the alleged £147,000 of payment - casts a small shaft of light into the murky world of corporate lobbying.

The lobbying industry is estimated to be worth £2 billion, making Britain the third-biggest market in the world after the US and the EU. It is growing, too. At the recent Tory party conference, lobbyists representing everything from health insurers to the oil producers of Azerbaijan outnumbered ordinary delegates by nearly two to one. "The lobbyists are on their way to destroying conference  they take over fringe events, prevent open debate and push, push, push the line their employers pay them to articulate," complained Graeme Archer, a party activist.

But perhaps Cameron's biggest assumption was that "we all know how it works". As an ex-public relations man, he does. So does Nick Clegg, a former Brussels lobbyist. But most voters have little clue what influence these paid representatives have on our politicians. As Tamasin Cave of the Alliance for Lobbying Transparency tells me, if we did, it would "change the debate" completely.

Of course, on one level, lobbying is normal. If you email your MP about bins, you are lobbying them. Trade unions, NGOs and charities lobby a lot. The Royal Society for the Protection of Birds is notoriously good at it. "It ought to be a completely legitimate part of the democratic process," says Douglas Carswell, a backbench Conservative MP who is calling for greater transparency. "It's corporate lobbying, when there's an unaccountable concentration of power and a little network that can't be seen by the voter - that's when the problem occurs ... it explains why people vote for change and don't always get it."

That usually happens when there are large sums of money involved. When the Government is taking a decision on placing wind turbines, changing the rules on smoking or drinking, building a third runway at Heathrow, or privatising the NHS, lobbyists won't be far away. As Carswell says, "If you're centre-Left or centre-Right or centre-nothing, why is our democracy being bought by corporate interests? It's wrong."

So how does it work? Theoretically, a lobbyist is as good as his arguments and his contacts book. He might persuade a sympathetic MP to raise questions in Parliament by presenting them with fresh evidence. He might try to influence civil servants directly, orchestrating meetings and organising events. He might run to fake letter-writing campaigns and infiltrating supposedly non-partisan think-tanks. It is all about "filling the information environment" to influence decision-makers.

The system is further complicated by something known in the trade as the "revolving door" - the mysterious portal through which people move between the Government and the commercial sector. To take a random example, George Bridges, the former campaign director for the Conservatives and one of Mr Cameron's close allies, now heads Quiller Consultants, a "strategic communications" firm. In January this year, he took on a new client: the City of London Corporation. It would be rash to draw any conclusions from this - but when people talk about this Government being close to the financial sector, that's the sort of link they have in mind.

The Ministry of Defence has a certain reputation in this regard. Carswell has raised in Parliament the case of the Future Lynx helicopter. In 2006, the MoD awarded a £1 billion contract to arms firm AgustaWestland to make 70 of them. There were much better helicopters available sooner and for far less money, Carswell claims: "So why on earth did we spend money on a helicopter that is inferior and cost much more to buy? Partly because the lobbyists made the argument about preserving British jobs and sovereign capability. But we need to look at the revolving door between Westminster and some of these companies."

Sir Kevin Tebbitt, the former permanent under-secretary at the Ministry of Defence, is now on the board of AgustaWestland - which also employs one Sir Geoff Hoon, a former Defence Secretary.

I raise this question with Lionel Zetter, who has literally written the book on lobbying (Lobbying: The Art of Political Persuasion, Harriman House Publishing, £39.99). Zetter is a freelance public affairs consultant with clients including the Institute of Civil Engineers (ICE) and the Europe-Azerbaijan society. Defence is not Zetter's field, but he agrees that the MoD is particularly susceptible to lobbying as arms manufacturers basically have one client: the Government.

But it's not as simple as helicopter A being better than helicopter B. He said: "What do voters want? They want jobs and they want a robust economy. The two don't necessarily go together. You buy a piece of American kit, it might be cheaper - but you buy a more expensive piece of British equipment and it might safeguard jobs.

"That's the kind of decision politicians are paid to make. And this is where lobbying comes into its own. What lobbyists do ensure is that every side of the case is put. They make sure that any minister or civil servant who makes that decision [is] very aware of all the pros and cons and the unintended consequences. So it should result in better decisions."

Zetter claims lobbyists, including himself, helped reduce the cost of Crossrail from £18 billion to £16 billion - he worked on behalf of the ICE.

He believes the British system is the cleanest in the world. "[In] America, [there is] the most tightly regulated system in the world, and by my estimation it's the most corrupt," he says. (It has been calculated that the finance sector spent $5.1 billion lobbying the American government for deregulation. It won.) He puts this down to our differing systems of party funding - a slightly different can of worms. It simply takes a hell of a lot more money to get elected in America.

Tamasin Cave splutters when I suggest our system may be better in this regard. "Do we not have that in Britain? Look at the extent to which the Conservative Party is funded by the financial services industry. We live in this country with a delusion. We imagine it's run by gentlemen and we have a clean system. We look at the States and we think that we're not susceptible to those forces. People who were spending $1 million a day fighting Obama's health reforms have also been lobbying our government. They see the NHS as a great prize."

On the emotive issue of the NHS, Cave claims there are two debates: a public one led by David Cameron and Health Secretary Andrew Lansley, and a private one. "When you look their statements to industry at invitation-only events, or prohibitively expensive ones, then you see a very different message."

But surely they have a right to meet with industry representatives? She points to a disparity of access. "Why do people lobby? Because it works. There's an oft-quoted statistic from the States: for every dollar you spend on lobbying, you can expect $100 return. They do it because it benefits the bottom line. If you look at the $2 billion that's spent on lobbying in this country, it's not being spent by civil society groups. It's being spent by corporate interests. This money is buying them a bigger voice in government."

So what should we do about it? Carswell believes that parliamentary select committees should oversee the appointment of civil servants and non-departmental public bodies and hold them annually to account. The Alliance for Lobbying Transparency is calling for a compulsory register of lobbyists' interests, which would allow the public to know who is lobbying whom about what, and how much money they are spending on it.

"Say they had brought in the statutory register of lobbyists a couple of years ago," says Cave, and we had public knowledge that these large companies were spending, say, £2 million, £5 million, lobbying our government over the past five years, and that they were meeting certain key people in the Department of Health, it would change the debate. Why are they spending millions of pounds to get to our politicians? What's the prize? If they want to get their hands on the NHS, fair enough - but let's have a public debate about it."

The lobbyists I have spoken to say they have no problem with this in principle - though they generally believe a "culture of honesty" and the scrutiny of the media create enough transparency. Still, for the media, untangling the threads is notoriously difficult and time-consuming - this is an industry that thrives on obfuscation.

There's a lot of that about in the present Government, as Zetter agrees: "A Coalition is a bit like playing three-dimensional chess - and we are quite good at that."

Will anything change? The Labour government ignored the Public Administration Select Committee's recommendation in 2009 that a compulsory register should be introduced. The Lib-Dems managed to secure such a commitment in the Coalition agreement - but nothing has happened yet.

Here it becomes rather Kafkaesque. The minister responsible is the Conservative Mark Harper. According to the Alliance for Lobbying Transparency, Harper has met lobbyists lobbying for the lobbying industry but has declined to reveal details of those meetings.

"It suggest that they're having an undue influence on a policy that is supposed to tackle undue influences," says Cave. "It's not without irony".

Carswell is convinced the problem would disappear with transparency. "It's a bit like MPs and their expenses. Sunlight is the best disinfectant. Ask yourself why don't we know what's been going on? It's because people would be embarrassed about it."

How to make friends and influence people

* The verb lobby is defined by the OED as: "To influence (the members of a house of legislature) in the exercise of their legislative functions by frequenting the lobby".

* The UK's growing lobbying industry is worth an estimated £2 billion and employs around 14,000 people.

* At the Conservative party conference there were an estimated 7,000 lobbyists - and only 4,000 delegates.

* Key lobbying firms include Weber Shandwick Public Affairs, Hill & Knowlton and Quiller Consultants.

* Lobbying in the UK currently has a system of voluntary self-regulation overseen by three bodies, including the Association of Professional Political Consultants (APPC), which was set up in the wake of the "cash for questions" scandal in 1994.

* In 2009, a select committee report, Lobbying: Access and Influence in Whitehall, concluded that there was "little regulation of any substance" and recommended setting up a compulsory register of lobbyists' interests. Parliament has yet to act on its findings.


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