The Politicians That Corrupt Democracy

16th October 2015 / EU, United Kingdom

Back in February this year, a debate about MP’s second jobs dominated Prime Minister’s Questions, after an undercover investigation involving former Foreign Ministers Jack Straw, Sir Malcolm Rifkind and a bogus Chinese company. David Cameron said having people with outside interests made for a “stronger Parliament”.

The former Foreign Secretaries were filmed discussing possible payments of up to £5,000 a day for using their contacts and experience to benefit a private company in a sting by Channel 4’s Dispatches and the Telegraph in what was termed ‘cash for access’.

Both men reported themselves to the Parliamentary Standards Committee, with Straw saying he had fallen into a “very clever trap” and Rifkind acknowledging his comments had been “silly.”

However, it is not unusual for MP’s to find themselves in these kinds of circumstances nowadays. More than 100 MPs declare additional employment in the Register of Members’ Interests, without including things such as occasional TV appearances, book royalties and giving speeches. Of the 108 MPs counted using this methodology, 17 are Labour and 80 are Conservatives, according to BBC Analysis and Research.

Analysis of official data by Statista for The Independent shows that British MPs earned more than £7 million in total outside their parliamentary wages last year, with Tories accounting for the largest proportion.

MPs with the most lucrative earnings from jobs outside of politics contribute to fewer parliamentary debates, are absent for more votes and submit fewer written questions than other Members of Parliament, a report suggests.

The report reveals these high-earning politicians have participated in 22 percent fewer debates than their parliamentary peers since March 2014.

It indicated that Britain’s top-earning MPs tendered almost 40 percent fewer written questions than their colleagues who do not have second jobs. Additionally, the high-earning MPs failed to turn up for 373 votes on average – a significantly higher absentee rate than their parliamentary colleagues, the report said.

At this point, one can make assumptions or come to conclusions about how ethical second jobs for MP’s really are. You might come to the conclusion that the salary is not enough to entice the very best quality of individuals for such an important role, you might think they earn enough, or even, too much. From here though, there is a more sinister reason for peering into this opaque world of MP’s earnings and this is just one example.

In November last year, a ‘dossier of disgrace’ was published by Unite, Britain’s biggest union. It revealed that 71 MPs from the coalition government of 2010 to 2015 had links to private healthcare interests who voted to sell-off or privatise the National Health Service.

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Len McCluskey, Unite general secretary said: “The sheer scale of this conflict of interest is staggering, but it is the ongoing sell-off of our NHS that makes this the real scandal for our democracy”. He added; “In another attempt to ignore the view of the people of Britain David Cameron is still refusing to use his veto and exempt the NHS from a US EU trade deal called TTIP. What is our NHS doing in a trade deal with America? This again exposes the Government’s real plan for the NHS – complete and irreversible privatisation.”

The report uncovered 64 Tory and 7 Liberal Democrat MPs who had recent or current financial links to companies or individuals trying to profit from the sell-off of the NHS. All of them voted for the Health and Social Care Act, which created a legal mechanism to force commissioners to put NHS services up for sale. To say that this is a conflict of interest would be a very severe understatement of fact.

The report is damning and delves deeply into the commercial links these named MP’s have. For instance, we focus on just one from the report; Andrew Lansley – former health secretary and recently awarded a life peerage.

John Nash, the former chairman of Care UK, gave £21,000 to fund Andrew Lansley’s personal office in November 2009 when he was shadow health secretary and preparing the White paper that led to the health and Social care bill. Care UK confirmed that 96 per cent of Care UK’s business, which amounted to more than £400 million last year, came from the NHS. Hedge fund boss John Nash is a regular Conservative donor with close ties to the healthcare industry. John Nash and his wife Caroline gave £203,500 to the party over the past five years. He is also a founder of City firm Sovereign Capital, which runs a string of private healthcare firms. Andrew Lansley received a donation from Julian Schild used to support his office in his capacity as Shadow secretary for health. Julian Schild’s family made £184 million in 2006 by selling hospital bed-makers Huntleigh Technology.

Andrew Lansley’s wife, Sally Low, is founder and managing director of Low Associates. A Daily Telegraph report in February records that the Low Associates website lists pharmaceuticals companies SmithKline Beecham, Unilever and P&G among its clients. It also records Ms Low’s assertion that the company “does not work with any client who has interests in the health sector”. The website currently contains no reference to the drug firms listed above. In addition, Christina Lineen, a former Head of Communications at private health company Circle spent two years working for Lansley, when a shadow health secretary.

John Nash was eventually appointed education minister, then made a life peer, now Baron Nash and has already attracted controversy with some influential decisions upon public life.

Current health secretary Jeremy Hunt, also used to an investigation or two, received two donations to his constituency office from hedge fund boss Andrew Law. Law has donated over £600,000 to the Tories and his firm holds multi-million healthcare investments.

These examples demonstrate that politicians have little respect for the Ministerial Code which, is supposed to be a code of ethics and procedural guidance for ministers, introduced as a result of the first report by the committee on standards in public life in 1995, which is revised every parliament. It is based on the seven principles of public life: selflessness, integrity, objectivity, accountability, openness, honesty and leadership – almost universally rejected by today’s politicians.

Does it get any better in the European Union? No really, this from Corporate Observatory – “Conflicts of interest continue to plague the European Parliament one year after elections”, finds new research released today’.

The report from Friends of the Earth Europe, Corporate Europe Observatory and LobbyControl, focuses on just nine cases of MEPs who have other jobs while holding public office. All nine MEPs hold paid positions in companies or business associations that directly or indirectly lobby EU decision-makers on current legislative files. The cases include parliamentarians from Poland, Italy, Germany, Belgium, France, the UK, Denmark and Austria – some of which had already given rise to concerns in the last parliamentary term.

Paul de Clerck of Friends of the Earth Europe said: “It is not acceptable that MEPs work for companies that are at the same time lobbying the EU. This undermines public trust in law-making and the integrity of the European Parliament. MEPs should be their electorate’s representative, not industry’s representative.

The report authors point out that the existing code of conduct for MEPs, introduced in 2012, is insufficiently enforced and riddled with loopholes so that problematic cases keep arising.

Olivier Hoedeman from Corporate Europe Observatory said: “Voters deserve better than a weak code of conduct that has done very little to end the problem of undue influence and potential conflicts of interest. Parliament’s President Martin Schulz should act on this now and show citizens that he’s serious about tackling this threat to democracy.”

Nina Katzemich from LobbyControl said: “Three years after the code of conduct was adopted, there are still many MEPs with potential conflicts of interest and dubious declarations of financial interest. It is high time for an overhaul. We demand the parliament bans all side jobs in companies or associations that try to influence EU legislation.

The aforementioned Mr Straw with his near-doubling of former MP’s pay with what he calls a “very fine, old established” commodity firm, for whom he has, (he explained to the undercover reporters) secured tweaks to sugar-refining regulations in the EU demonstrates just how insecure democracy is.

If politicians have an expectation that they can be hired or contracted out, it is inevitable that fraud and corruption will be ever-present in the end. This is now self evident with the continuing scale of scandals involving MP’s and MEP’s.

Paid-for politics has already got a grip. The private sector would have sacked employees with undisclosed conflicts of interest such as these. The principle should exist that MPs will not expect to be paid beyond their salary for intervening in public life. The problem is that the very people who could enforce this, the lawmakers, are themselves profiting in exactly these same ways.

Graham Vanbergen – TreuPublica

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