UPDATED: Cayman’s Lord Blencathra banned from lobbying
By Oliver Wright From The UK Independent
Peers banned from lobbying in return for money or rewards
Committee outlines shake-up in Parliamentary rules following exposé by ‘The Independent’
Members of the House of Lords are to be banned from lobbying ministers for money in a shake-up of Parliamentary rules following an exposé in The Independent.
Under changes to the Lords Code of Conduct published on Monday, peers will be banned from lobbying members of either the Commons or Lords, ministers or government officials “in return for payment or other reward”.
Staff who work for them and who hold a Parliamentary pass will also be required to register “all third-party employment” regardless of whether or not that employer is engaged in Parliamentary lobbying.
In addition, peers will also have to register any gift or hospitality worth more than £140 compared to the previous limit of £500, bringing them into line with the threshold for Government ministers.
In its report setting out the new rules, the House of Lords Privileges and Conduct Committee specifically mentioned the case of Lord Blencathra as a reason why the changes are necessary. In 2012 The Independent and Bureau of Investigative Journalism revealed the former MP and Tory chief whip was being paid by the Cayman Islands government to represent the interests of its financial services industry.
As part of his job, he lobbied the Chancellor George Osborne to reduce the burden of air passenger transport taxes on the Caymans and facilitated an all-expenses-paid trip to the islands for three senior MPs, including the chairman of the influential Tory backbench 1922 Committee. But a complaint against him was rejected by the Lords authorities on the grounds that there was “no evidence that Lord Blencathra exercised parliamentary influence on behalf of the Cayman Islands Government Office in the United Kingdom” and that he had therefore not breached the rules at the time.
However, in its report on Monday, the committee noted: “As currently drafted [the code] does not explicitly prohibit Members themselves lobbying ministers or officials in return for payment or other incentive or reward.”
It adds: “We do not believe this loophole was intended when the prohibition on providing parliamentary services in return for payment was introduced in the 2010 Code. In addition, recent cases on which we have reported indicate some Members seemed to believe providing parliamentary services in return for payment is within the rules so long as it is registered and, where appropriate, declared. That is evidently not the case.”
A footnote to the report references the Lord Blencathra case. Paul Flynn, the Labour MP who referred Lord Blencathra to the Commissioner for Lords Standards, said he welcomed the new rules.
“The previous rules had a dangerous loophole that was not compatible to the principles of transparency that should be fundamental to public life. The idea a peer could divide themselves in two with one half being a lobbyist and the other being a Parliamentarian was always absurd and I am delighted the Lords Authorities have recognised this.”
The new rules will come into effect after being ratified by a vote of the whole House of Lords. No-one from the Privileges and Conduct Committee was available to comment.
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Press Release from Cayman Islands Government
Mon Feb 17 2014 – House of Lords report noted
GRAND CAYMAN, Cayman Islands – The Cayman Islands Government is aware of and is taking into consideration a report that bans members of the House of Lords from lobbying ministers.
Changes to the Lords Code of Conduct were published Monday that said peers will be banned from lobbying members of either the Commons or Lords, ministers or government officials. Staff who work under them and who hold a Parliamentary pass will also be required to register “all third party employment”.
See also related story from The Bureau of Investigative Journalism published October 2 2012
House of Lords: Foreign Office approved peer’s role as tax haven lobbyist
By Melanie Newman
The Foreign and Commonwealth Office approved Lord Blencathra’s appointment as a paid lobbyist for the Cayman Islands government, despite his role potentially breaching parliament’s code of conduct.
Lord Blencathra was appointed director of the tax haven’s London office in November 2011 and his consultancy, Two Lions, is paid £14,000 per month for his services.
Following a Bureau investigation into Lord Blencathra’s lobbying activities he was referred to the Commissioner for Standards and is under investigation for a possible breach of the House of Lords Code of Conduct, which forbids peers from accepting payment for parliamentary services.
The FCO told the Bureau in April, following our investigation, that it had played ‘no role’ in the appointment.
However correspondence released under Freedom of Information shows the Minister for Overseas Territories, Henry Bellingham, approved Lord Bencathra taking the job despite looking at the potential for conflicts of interest arising from his role in the House of Lords.
As a member of the House of Lords, Lord Blencathra is entitled to vote on legislation affecting the jurisdiction.
Lord Blencathra wrote to Mr Bellingham on November 10 2011 announcing that he would be representing the interests of the Cayman Islands government at a ‘strategic and political level’. The London office was expanding with the goal of promoting the Islands and their financial and tourist industries and improving their relationship with the UK government, he added.
His letter was written on paper headed ‘The Rt Hon the Lord Blencathra,’ suggesting he was writing in his capacity as a member of the House of Lords, though he apologised for this and said he would only be using the paper ‘for the next few days’.
He also emailed the FCO’s Overseas Territories Directorate asking to discuss the agenda and expected outcomes’ of a meeting between Mr Bellingham and Caymans Premier McKeeva Bush scheduled for a few days later.
The peer met officials from the directorate the next day.
FCO notes of the meeting state that the department was ‘considering the implications of a member of the House of Lords being appointed on contract to an Overseas Territories government (ie paid) to represent its interests.’
It added that there was also ‘a question of Party allegiance’ to consider. ‘The FCO had taken the view in the past that Ministers could not include MPs of their own party with no role in government in governmental meetings.’
At the meeting, Lord Blencathra reassured the FCO that he wished to avoid any perception of conflict and that he ‘had no interest in advancing his party’s politics through this job.’
On December 20 2011, Mr Bellingham wrote to the Premier of the Cayman Islands, McKeeva Bush, stating: ‘We have given provisional approval of this appointment.’
The FCO has withheld other correspondence relating to the peer on the grounds that it could prejudice relations between the UK and the Islands.
Lord Blencathra has admitted that his job involves lobbying and that he was appointed on the basis of his Westminster experience and connections to ‘get the message across’ to the UK government.
Guidance on the Code of Conduct for Members of the House of Lords says members may not accept payment in return for parliamentary services. This includes a ban on peers ‘making use of their position to arrange meetings with a view to any person lobbying Members of either House, ministers or officials.’
Lord Blencathra had attempted to arrange a meeting between an MP who had criticised the Islands as a tax haven and a delegate from Cayman, as well as lobbying Chancellor George Osborne to reduce air passenger transport duties on the Caymans.
Asked if his activities were compatible with the Code of Conduct, he told the Bureau in April: ‘You have confused lobbying parliament, which I do not do, with lobbying the government, which I do.’
Labour MP Paul Flynn referred the matter to the Commissioner for Standards, which has yet to announce its findings.
Any finding of misconduct would be hard to square with the FCO’s approval for the role however.
Since Lord Blencathra’s appointment relations between the Islands and the UK have deteriorated substantially as a result of British concerns over procurement practices and government spending.
However last week it was reported that Mr Bush is seeking UK help in lobbying against EU proposals to bring the Overseas Territories’ financial services regimes into line with EU legislation.
Lord Blencathra has been lobbying in Europe as well as in the UK. He has met Ashley Fox, MEP for the South West, to discuss ‘EU financial regulation and proposals for a financial transaction tax’.
More recently he has spoken at a conference as a representative of the Caymans on the controversial EU legislation known as AIFMD (the alternative investment fund managers directive), which will regulate hedge funds.
PHOTO: Foreign office minister Henry Bellingham meets McKeeva Bush, Premier of the Cayman Islands, in 2010
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