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From Our Practical Politics Blog

Why the Lobbying Act increases inequality of influence (and what to do about it)

The new Lobbying Act is one of those futile laws which fails to address the real problem and creates a mess of new problems instead. The “Gagging Bill” as campaigners called it, is now the Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Act 2014. It  was supposed to deal with the problem of undue influence by lobbyists. Instead it threw yet more red tape over non-party groups which try to give people a stronger voice before elections. In doing so the government successfully created one of the broadest coalitions against its policies and further damaged trust in politics. The Act creates a yet another barrier round the political elite which only the well-off and well informed can negotiate. It swats the small fly while feeding the big beasts growing fat from the state.

If you were cynical, you might suspect the government laid this trail to lead activists down a merry path away from the big beasts of corporate influence embedded in Whitehall. But the simple reason,  as explained by the Daily Mail, is to minimise campaigning by trade unions during the next election.

The real problem for democracy is, how can all citizens have equality of influence? Relatively small networks of people in the media, corporations and pressure groups know how the system works. They use their knowledge to promote their own interests. The manoeuvrings and battles among these networks are intense, but most people barely get a look in. The Lobbying Act deals with the least powerful within these networks while the Government gives free gifts to the most powerful. It begins to look like a strategy.

Shortly before the last election, David Cameron predicted that political lobbying would be the “next big scandal” and pledged to rebuild trust in politics by shining “the light of transparency on lobbying” and force “our politics to come clean about who is buying power and influence.” (for the full speech go to Spinwatch here)

To address this problem, Mr Cameron could have done three things:

  1. Require all officials as well as ministers to publish lists of meetings with third parties, with a few words about what was discussed;
  1. Create a register of all professional lobbyists, including employees and external contractors who are paid to lobby for an organisation or interest, and record all  contact between paid lobbyists and parliamentarians as well as officials;
  2. Promote “equality of influence” by providing independent education, information and support for everyone to know how the system works and how to have an effective say in shaping public policy.

The coalition government has done a great deal to increase transparency, publishing departmental business plans; details of ministers’ meetings, gifts and travel; departmental spending over £500, and a host of other data. The trouble is, you can only use this information if you know how the system works. As a result, transparency is a free gift to campaigners, journalists and lobbyists who previously had to dig for it. It is worth little to most people, unless they are part of an organisation which keeps them informed and campaigns on their behalf – the very organisations the Lobbying Act will ensnare with red tape.

Lobbying is a necessary part of the political process. People need to tell the Government what they want it to do. They also need to know how Government decisions could affect them and lobby if their interests are affected. Its the Government’s job to balance competing interests and decide what’s best for the whole country. Many organisations employ lobbyists and campaigners to ensure that their interests are taken into account, but if you don’t have a voice you are ignored and will lose out to those who do. This is the real problem the lobbying bill should have addressed.

Most people have no idea what the government is up to or how to influence it. The result is, in David Cameron’s words, that we have “money buying power, power fishing for money and a cosy club at the top making decisions in their own interest.” Charities, community organisations, pressure groups, trade unions, the media and backbench members of parliament  all play an important part in increasing access to influence and power, but even they only represent a relatively small proportion of the public. Those with money, on the other hand, can buy even greater influence, as Cameron warned. They do it directly, through donations to politicians and parties, and indirectly through media ownership and funding for think tanks, pressure groups, campaigns and lobbyists.

Businesses have a legitimate and necessary interest in government policy. Government directly affects the economic conditions in which they work, through interest rates; the state of roads, rail and other infrastructure; wages costs, taxes and regulation. The public sector is the largest single market in Britain, with the government spending over £110bn a year (over 15% of public spending) on buying goods and services, mostly from private companies. Increased privatisation and contracting out of services makes corporate lobbying (and the risk of corruption) ever more important. The Government also gives private businesses over £7bn in grants, subsidises low wages through £25bn in Working Tax Credits and gives private landlords a sizable share of £15bn in housing benefits. Since 2008 the government has also bailed out the banks by about £123.93bn (at its peak the taxpayer had liabilities of £1.2 trillion for the banking crisis). Reckless banking cost the country over 13% of GDP and a huge loss of tax revenue, but still the Government defends million pound bonuses for loss-making bankers. Sitting at the table of Government is a very good investment for business. Lobbying pays.

Representatives of business work closely with government officials and ministers to create a business friendly environment.  This can benefit the public by creating jobs, goods, services and tax revenues. But not all business is beneficial and some use their influence to block  competition, innovation or essential regulation.  But big businesses has long gone beyond lobbying to become part of machinery of government. Vast companies like Atos, Capita, G4S, Serco and Tribal run large areas of public services. Large companies even have ‘ministerial buddies’ to  create privileged access. The Government, regulators and business also coordinate policies through myriad bodies such as the International Regulatory Strategy Group (IRSG), the Defence Growth Partnership (DGP) and other forums on which consumers, staff or other stakeholders are rarely represented. Foreign Office officials can even be hired to sell any dodgy product, such as fake useless bomb detectors. The sheer scale of business involvement in the state means that corporations have become “governing institutions”, as described by Professor Steven Wilks in The Political Power of the Business Corporation (2013).

This is the big beast which the lobbying law ignores. It only covers meetings between external consultants (not in-house lobbyists) and ministers or permanent secretaries (but not special advisers or officials). This leaves out over 95% of professional lobbying and all of the contractual intimacy of public procurement. Research by the Association of Professional Political Consultants (APPC) showed ministers in the Department for Business, for example, held 988 meetings with lobbyists in 2012. Just two were with consultant lobbyists who would have had to declare the meetings under the new law. Nor does it cover influential former minsters like Lord Mandelson, whose consultancy business, Global Counsel, provides strategic advice to anonymous clients, as pointed out by Peter Oborne of the Telegraph.

Only a tiny minority of lobbyists will be covered by the new law …

The government's proposed lobbying bill would keep the vast majority of corporate lobbying secret

 … who will only be required to disclose minimal information on their lobbying (Graphic from the Alliance for Lobbying Transparency

The  Civil Society Commission,  38 Degrees, over 130 charities and campaigning groups, and 190,000 members of the public did a fantastic job of lobbying members of parliament and organising meetings across the country: watch this video to see some of the passionate challenges to politicians. The campaign was narrowly defeated in the House of Lords, but there were several gains, such as raising the threshold for non-party organisations to register with the Electoral Commission to £20,000 for England (from  £10,000 under PPERA, the Political Parties, Elections and Referendums Act 2000), reducing the regulatory period from 1 year to 7.5 months for the 2015 General Election, getting a review of non-party campaigning rules after the election, and a cut in some of the red tape (read more at 38 Degrees).

But by far the biggest gain was the campaign itself – the broad base of support from many different organisations and communities; the support in the House of Lords, not to mention the permanent damage to Government’s reputation as a champion of civil society and democracy. Many people were genuinely shocked by the Government’s attempt to clamp down on third party campaigning while doing almost nothing to tackle the much bigger issue of the £2bn influencing industry.

However, I don’t think the Government’s new rules matter much anyway, for at least three reasons:

  • first, effective third party campaigns do not support one party or candidate, but aim to get all parties to support their objectives. Charity law provides clear and useful guidelines for campaigning, which prevents charities from being aligned with a political party anyway. Charities, NGOs and even unions are more trusted and respected than most politicians or party, so why would they tarnish their reputation by backing one party against another?
  • second, third party campaigns are most effective when the they influence the public and political get parties to address issues in their manifestos long before an election.
  • third, big companies and the media often have more influence on Government priorities than the electorate, so effective campaigners should target the powers behind the throne than the puppets who sit on it.

If you are part of a campaigning organisation, the time to influence candidates, parties and voters in the 2015 general election is NOW! Get your cause into party manifestos and build support well before the election in May 2015 – 7 ½ months before is mid-October this year, when most parties should have a clear outline of their manifestos.  Campaigners could also consider joining or setting up a political party: many civil society activists are not members of political parties (including me), but political power and responsibility is taken by parties who put up candidates for office and campaign for election. You can influence the big parties from within or by challenging them by standing as an independent, for the Greens, National Health Action, SNP, UKIP or any of 400 political parties on the register.

The coalition which campaigned on the lobbying bill (now Act) is mobilising people to persuade the Labour Party to make a commitment to repeal the section restricting campaign spending by those not standing for election or registered as political parties (go to the petition).

But the bigger issues is that deflecting attention from the power of money to influence public policy the Lobbying Act has weakened democracy and greatly increased inequality of influence. To  bring about greater equality of influence all citizens need to have an effective voice in politics. This will be hard to achieve. It means making the political system more accessible, all lobbying completely open and transparent, and providing effective political education.

Here are three small things we can do in response to the Lobbying Law

  1. Encourage voter registration – support initiatives by Bite the Ballot’s National Voter Registration Day (#NVRD) on 5 Feb,  Operation Black Vote and your local council;
  2. Support the Alliance for Lobbying Transparency’s campaign to end secrecy in lobbying: sign the petition to stop secret corporate lobbying and write to your MP.
  3. Cut out the middle men by targeting the companies, industry associations and media which influence the issues you care about.

Warren Buffett said “It takes 20 years to build a reputation and five minutes to ruin it.” Most companies are more sensitive to influence than politicians, so why waste time on politicians?  Companies that pay minimal tax, pay low wages or case harm deserve to be targeted, while companies that do good should be encouraged. Politicians often carry the can for policies promoted by business interests, but the Lobbying Act deflects that back onto the banks, big energy companies and others during the pre-election period.

For reasons to campaign on corporate lobbying, read the Open Knowledge Foundation’s “5 Reasons To Stop Secret Corporate Lobbying“, the Daily Mail on ‘How food giants sweet talk ministers‘ to keep unhealthy sugar levels, the climate lobbyists and the 30,000 strong “Lobbycracy” who shape policy in Brussels.

To get equality of influence – that is, everyone has an equal voice – those who feel powerless must be able to speak up for their interests. The political system needs to be much more accessible, more like a supermarket than a citadel. It needs to be more open, so that the workings are visible and explained. And we need promote practical political education through the media and in schools, colleges, communities and unions, to show how the system works and how to influence it.

Practical political education takes many forms, including:

  • Hustings and public meetings to discuss issues with candidates will before the elections
  • Action to raise awareness of policy choices over banking, energy, employment, the economy, health, housing, lobbying and other issues
  • Activities round anniversaries such as the first world war (2014), Magna Carta (1215), De Montfort Parliament (1265), votes for women (2018) (see anniversaries for more)
  • Publicising the role of lobbyists in shaping policy before the public even get a look in
The campaign against the “Gagging Law” was also an exercise in political education for many who glimpsed how the system works to exclude  them. The apparent defeat may turn out to be less important than the movement it created.  The Government and its corporate sponsors could yet regret their victory.

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