Draft Lobbying Transparency Bill Introduction

It is the next big scandal waiting to happen. Its an issue that crosses party lines and has tainted our politics for too long, an issue that exposes the far-too-cosy relationship between politics, government, business and money.
Rt Hon David Cameron MP Lobbying is an essential part of a healthy democracy. However, professional lobbying an industry worth 2 billion in the UK can subvert democracy by giving those with the greatest resources undue influence and privileged access to politicians. The problem is, at the moment, most of this is done in secret. We cant make an informed decision about what is or isnt appropriate. In 2010 the government committed itself to introducing a statutory register of lobbyists and following the latest scandal, has announced that their proposals will be published by July 2013. However we have a number of concerns about the government's approach to a lobbying register. Firstly, that their definition a lobbyist would only cover about one fifth of the lobbying industry, specifically those working for multi-client lobbying agencies. Secondly, the information that they would be required to disclose would not allow public scrutiny of lobbying activity, merely who was lobbying. Thirdly, it appears that the government may be adding on a number of tangential party funding reforms onto the lobbying bill, seemingly in an attempt to play party politics with the issue. We have a significant chance to make progress on lobbying right now; if David Cameron and Nick Clegg are serious about doing so, we suggest they focus on legislating for a robust and comprehensive lobbying register and cleaning up parliament. Unlock Democracy and Spinwatch are campaigning for the introduction of a robust lobbying register that includes all lobbyists and provides information on who is lobbying whom, what they are lobbying for and how much money is being spent on lobbying. This is our attempt at drafting a bill that could implement these proposals. Whilst we are not experts in drafting legislation, this is based on lobbying transparency regulation from around the world and is the benchmark by which we will judge the government's proposals. The draft bill is intended to stimulate debate about what a UK lobbying register should look like. If you have any comments or queries please contact consultation@unlockdemocracy.org.uk

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Draft Lobbying Transparency Bill

A Bill to increase the integrity of government decision-making by ensuring that lobbying takes place in as open a way as possible through the establishment of a public register of organisations and individuals that carry out lobbying of Parliament and the Government in a professional capacity; to introduce sanctions for non-compliance with the register and for related purposes. Be it enacted by the Queens most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows: 1. Interpretation For the purpose of this Act: 1.1 Lobbyist means a person who, for payment, undertakes lobbying activity as defined in 4.5. It includes a person who engages in lobbying activity on behalf of a third party client (consultant lobbyist); and an employee, officer, director, partner, proprietor or shareholder (but not unpaid volunteers) of an organisation who engages in lobbying activity on behalf of that organisation (in-house lobbyist); subject to the threshold set out in 4.4. 1.2 Public official means: i) Members of either House of the UK Parliament and their staff; ii) Individuals employed by or working in: a) Government departments; b) Executive agencies, non-ministerial government departments and nondepartmental public bodies; c) Regulatory bodies, including quasi-governmental regulatory agencies such as the Financial Conduct Authority; d) Advisors to the above, who are otherwise not employed by, or seconded to government but have an official, if temporary role. 1.3 Organisation includes any of the following, whether incorporated, unincorporated, a partnership or a sole trader: i) Company incorporated under the Companies Act; ii) Business, trade, industry, enterprise, professional organisation Non-profit organisation, association, charity, or interest group; iii) Trade union or staff association; iv) Chamber of commerce or board of trade; Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

v) Foreign Government, British Overseas Territory or Crown Dependency; vi) Coalition or group of organisations.

1.4 Communicate means to contact via oral or written communication, including electronic communications such as email or text messaging; the circulation of information material or position papers; or the organisation of events or any promotional activity in support of a lobbying position, which is then communicated to a public official. 1.5 Payment means any gift contract, promise, or agreement to pay money or sponsorship to the organisation or the provision otherwise than on commercial terms of any property, services or facilities for the use or benefit of the organization, including the services of any person. 1.6 Expenditure means monies spent, including salary costs, on lobbying activity 1.7 Registrar is the body appointed by the Secretary of State to: i) implement this Act; ii) collect, publish and maintain the register of lobbyists; iii) monitor and enforce the code of conduct including investigation of alleged breaches of the code; iv) report annually to Parliament on the operation of this Act and any amendments it deems necessary. 2 Exemptions 2.1 This Act does not apply to the following persons: i) An individual constituent contacting or communicating with their Member of Parliament; ii) Public officials acting in an official capacity; iii) Elected members or officials working in international bodies of which the United Kingdom is a member; iv) A person contracted to, or on secondment to government or otherwise acting in an official capacity on behalf of a government organisation; v) Diplomats, consular officials or official representatives in the State of foreign governments when acting in their official capacity; 2.2 This Act does not apply in respect of: i) Any oral or written submission made to either House of Parliament, or any of its committees in proceedings that are a matter of public record; ii) A public response to an invitation by government to submit information or evidence, or a public response to a government consultation exercise, or a formal response to a public invitation to tender; iii) Administrative requests made by lobbyists, where no attempt is made to Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

influence. 2.3 For the purposes of this Act, lobbying activity does not include: i) Any oral or written communication that is made widely and publicly available, such as a speech; ii) Communication directly related to negotiations on terms and conditions of employment of public service employees undertaken by trade union or staff association representatives on behalf of their members; iii) Communication by media workers in the course of their work. 2.4 In addition: Nothing in this Act shall be construed as requiring the disclosure of the name or identity of any individual where that disclosure could reasonably be expected to threaten the safety of that individual. 3. Register of Lobbyists 3.1 A Registrar shall establish and maintain a register to be known as the register of lobbyists, in which is kept a record of all returns and other information/documents submitted to the Registrar under the Act. 3.2 The register shall be an electronic based system which is publicly available at all times via the internet for searching and viewing without charge. All filings shall be made in electronic form. 3.3 An individual or organisation that engages in lobbying activity without being registered may be liable on summary conviction to fine not exceeding level 5 on the standard scale. 3.4 If the Registrar requests information to clarify any information that has been provided under section 4, the registrant shall, in the prescribed form and manner, not later than thirty days after the request is made, provide the Registrar with the information. 4. Requirement to file return 4.1 An organisation or an individual engaged in lobbying activity, as defined in 4.5 below, must complete a registration and file quarterly returns with the Registrar containing the information set out in 5.2 and 6.2 in the form and manner required. 4.2 Any organisation that has one or more employees who are engaged in lobbying activity shall file a single registration under this section on behalf of and listing such employees. 4.3 In the case of an organisation or an individual engaged in lobbying activity on behalf of more than one third party client, the organisation or individual shall file a separate registration under this section for each such client, on behalf of and listing all lobbyists for that client. Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

4.4 Threshold for in-house lobbyists: An organisation engaged in lobbying activity on its own behalf whose total expenditure in connection with lobbying activity does not exceed or is not expected to exceed 5000 over a three month period is not required to register its lobbying activities as defined in section 4.5 under the Act. 4.5 For the purposes of the Act an organisation or an individual is engaged in lobbying activity if, for payment, they undertake to: a) Arrange or facilitate a formal or informal meeting with a public official; b) Communicate with a public official; c) Advise others in a professional capacity in respect of a) and b); d) Work to support a) and b), including any supervision, planning, coordination with the lobbying activities of others, research or other background work that at the time it is done is intended for use in support of a meeting or communication with a public official. In respect of i) The holding of a debate or tabling of questions in either House of Parliament, the introduction of any Bill, motion or resolution in either House of Parliament or the passage, defeat or amendment of any Bill or resolution that is before either House of Parliament; ii) The formulation, modification, or adoption of regulation, policy, or position of HM Government; iii) The awarding of any contract, grant or other financial benefit by or on behalf of HM Government. 5. Registration 5.1 An organisation or individual required to register must do so, in the prescribed form and manner, with the Registrar: (a) in the case of an organisation or individual engaged in lobbying activity on behalf of a third party client, within 14 days of commencement of a contract; (b) in the case of an organisation engaged in lobbying activity on its own behalf, within 30 days of the commencement of lobbying activity. 5.2 The registration shall set out the following information: (a) the name and business address of the registrant, and a general description of its business or activities; (b) the name and business address of the registrants client, and a general description of its business, if different from (a); (c) the name and business address of any organisation, other than the client, that funds the lobbying activities of the registrant or actively participates in the planning, supervision, or control of such lobbying activities. (d) where the registrant is a coalition, the name and business address of each Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

member organisation of the coalition; (e) the name of each employee of the registrant who has acted or whom the registrant expects to act as a lobbyist on behalf of the organisation or client and, if any such employee has served as a public official in the ten years before the date on which the employee first acted as a lobbyist on behalf of the organisation or client, the position in which such employee served; and whether that employee is a Parliamentary pass-holder; (f) information to identify the subject-matter of the lobbying activity; (g) information to identify any relevant legislative proposal, Bill, resolution, regulation, policy, program, grant, contribution, financial benefit or contract; (h) the name of any department or other governmental institution in which any public office holder is employed or serves at whom the lobbying activity is directed; (i) information to identify any communication technique that the registrant uses or expects to use in connection with any communication with a public official, including: (i) any appeals to the general public, or segments thereof, through the mass media or by direct communication that seek to persuade those members of the public to communicate directly with a public official in an attempt to place pressure on the public official to endorse a particular opinion; this does not apply to an appeal by an organisation directed to its members, employees, officers, or shareholders. (ii) the name of any secondary organisation that is funded by the registrant and which in turn engages in lobbying activity to the direct or indirect benefit of the registrant. 5.3 A registrant who after registration is no longer engaged in lobbying activity, either on its own behalf, or has ceased to be retained by a third party, may so notify the Registrar and terminate registration. 6 Quarterly reports by registered lobbyists 6.1 Registrants are required to file quarterly reports no later than 20 days after the end of the quarterly period beginning on the first day of January, April, July, and October of each year in which a registrant is registered. 6.2 The quarterly reports shall set out the information required in 5.2 with the additional requirement of the following financial disclosure: (a) in the case of a registrant engaged in lobbying activity on its own behalf, a good faith estimate of the total expenditure that the registrant and its employees incurred in connection with lobbying activity during the quarterly period; (b) in the case of a lobbying activity on behalf of a third party client, a good faith estimate of the total amount of all income from the client (including any payments to the registrant by any other person for lobbying activities on behalf of the client) during the quarterly period, other than income for matters that are unrelated to Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

lobbying activities. 6.3 Estimates above 10,000 shall be rounded to the nearest 10,000. If estimates do not exceed 10,000, it should be reported as less than 10,000. 6.4 A registrant who files a return shall provide the Registrar with such information as the Registrar may request to clarify any information that the individual has provided to the Registrar, and shall do so not later than thirty days after the request is made. 6.5 The obligation to file a return terminates when the registrant no longer engages in lobbying activity and a report has been filed with the Registrar advising of that fact. 7. Code of Conduct 7.1 The Registrar shall, after consulting with relevant stakeholders, prepare a code of conduct with which those included on the register shall comply, and may produce revised codes from time to time 7.2 The Secretary of State shall give statutory effect to this code and any subsequent code by order. 7.3 The Registrar must conduct an investigation if he or she has reason to believe, that an investigation is necessary to identify a breach of the Code or to ensure compliance with the Code. 7.4 Before making a finding that an individual or organisation has breached the Code, the Registrar must provide the individual or body with a reasonable opportunity to present their views to the Registrar. 7.5 Where the Registrar finds that a breach of the Code has occurred he or she must consider whether any individual involved in the activity constituting the breach should be suspended for a period of time as the Registrar thinks fit, or removed permanently, from the Register of Lobbyists. 7.6 When an individual is suspended or removed from the register under this section the Registrar must without delay, submit a report to the Speaker of both Houses of Parliament and notify in writing, the following persons: (i) every member of Parliament: (ii) every chief executive officer of a government department. 8. Annual report to Parliament 8.1 The Registrar must provide Parliament with an annual report concerning the administration of this Act for the period covered by the annual report. 8.2 The Registrar may, at any time, prepare a special report to Parliament concerning any matter under this Act if, in the opinion of the Registrar the matter is of such urgency or Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

importance that a report on it should not be deferred until the next annual report.

Draft Lobbying Transparency Bill Explanatory Notes

Clause 1.1 This clause makes it clear that all paid lobbyists should be required to register, not just those working on behalf of third parties, i.e. agency lobbyists as the government has proposed. In-house lobbyists outnumber agency lobbyists by at least 4:1.This clause makes clear that anyone who undertakes lobbying activity for payment must register, unless exempt under clause 4.4. Clause 1.2 The register would apply to lobbying directed at the UK central government only and not the devolved governments. Scotland is currently proposing is own register of lobbyists. Lobbying of local authorities could be incorporated at a later stage. Clause 1.3 The register should be designed to capture only significant lobbying activity. This is irrespective of whether it is being done by a for-profit, charitable or labour interest. Clause 1.7 The Registrar must be a body which is independent of both government and the lobbying industry. Rather than creating a new organisation, we propose that it should be given to an existing body that already has responsibility for maintaining registers. Examples would include the Electoral Commission and the Certification Officer. The Registrar should be publicly funded. Where other jurisdictions have implemented a lobbying register they have tended to create a new organisation so the costs are higher than for our proposals. In Canada an annual budget of $1.1 million - 706,682 is spent on the administration of the Registry at a national level. This includes salaries for the equivalent of six full-time employees dedicated primarily to providing registration assistance for lobbyists. The budget covers between $400,000 to $500,000 invested annually in technical work to maintain and upgrade the system 1.
1

For more information on these costs see https://ocl-cal.gc.ca/eic/site/012.nsf/eng/00442.html

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The European Union also operates a lobbying register. The operating budget of the Joint Transparency Register for 2013 is 130,000 - 110,430. It is estimated that, excluding IT maintenance and development as well as European Parliament accreditation procedures, the equivalent of four full-time staff (two per institution) are mobilised to carry out the work associated with the Register.

Clause 2.1 Any lobbying by a constituent of an MP would be exempt from the register as it would not constitute paid lobbying. Clause 2.2 This makes it clear that only communication instigated by a lobbyist would be included in the register. It does not seek to cover all interactions between government and outside interests.

Clause 2.3 This makes clear that lobbying activity does not include participation in public debate on matters of government policy etc, where no attempt is made to directly communicate with officials.

Clause 3.2 The register must be available online and be fully searchable, sortable and downloadable. Clause 3.3 The standard scale is a system whereby fines in legislation have maximum levels set against a standard scale. Then, when inflation makes it necessary to increase the levels of the fines the legislators need to modify only the scale rather than each individual piece of legislation. Currently level 5 on the standard scale is 5000. Clause 4.1 The register as proposed would not be a burden on lobbyists, who would complete an initial registration form, with quarterly updates on their lobbying activity. Clause 4.2 Under this proposal, the organisation, rather than individual lobbyist would be required to register, listing individual lobbyists. This would be the least onerous system. Clause 4.3 Anyone who lobbies on behalf of a client would file a separate return for each client. Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

Clause 4.4 The register is designed to record all significant lobbying activity. As such, there should be a threshold based on lobbying spend under which organisations would not have to register. This would exempt small businesses and smaller charities. The level of the threshold should be widely consulted on. Clause 4.5 This clause defines what constitutes lobbying activity. If someone is paid to undertake this, they must register (unless exempt under 4.4). Section c) acknowledges that many third party lobbyists have no direct contact with officials and act solely a advisers to clients on how to lobby government. Section d) also acknowledges the significant activity that goes in to supporting those who lobby directly.

Clause 5.1 This understands that an organisation will require more time to register its lobbying activity than an agency lobbyist, for whom registration of a client is triggered when work on that contract commences. Clause 5.2 This clause sets out the information that is required when an organisation makes an initial registration. The information required would be easy to gather. It includes: organisation details; names of lobbyists; and information on the lobbying activity, including what the organisation is lobbying on and whom in government is being lobbied. This information on the actual lobbying activity being undertaken is vital for the register to be meaningful. The ultimate purpose of a lobbying register is to increase government accountability by allowing the public to see lobbyists dealings with officials. Therefore, it must include details of which public officials are being lobbied and what issues they are being lobbied on. The governments proposals would not include this information. It proposed merely a list of lobbyists and their clients. Clause 6.1 Once registered, lobbyists would be required to provide quarterly updates on their lobbying activity. A quarterly filing would include information on which officials they have lobbied and what they have been lobbying on, as well as a requirement to disclose a good faith estimate of how much money has been spent on the lobbying activity. It is important to be able to see how much money is being invested in lobbying. Such disclosure would provide an indication of the scale of an organisations lobbying activity: lobbying is seen as a tactical investment by business, with an anticipated rate of return (US figures suggest that for every dollar spent on lobbying a company can expect $100 return). It would also reveal the spending gap between, for example, business and civil society Created by Unlock Democracy & Spinwatch www.UnlockDemocracy.org.uk www.Spinwatch.org

groups, or multi-nationals and non-profits lobbying for government contracts. It would also show trends in lobbying activity.

Clause 7.1 A Code of Conduct should be put in place in consultation with lobbyists from all sectors. It should set minimum standards of behaviour and should include, for example, a ban on paying Parliamentarians. Clause 7.6 Reputation is important to professional lobbyists. The proposed sanction for breaching the Code of Conduct, which would require the Registrar to inform officials of the breach, would be the most effective means of ensuring compliance with the Code.

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