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Academic says advisers bring conflict of interests By Rob Edwards 01 May 2005 Sunday Herald MINISTERS have been accused of ?corrupting the proper administration of government? by allowing staff from eight private companies to work within the Scottish Executive. Three leading banks, a well-known firm of solicitors, a power company and a range of commercial consultancies are all seconding key staff to work on crucial multi-million pound schemes, including the highly controversial public private partnerships (PPPs).
Although ministers and companies insist that there is nothing wrong with the arrangements, academic experts and MSPs say they inevitably create conflicts of interest. They fear that companies could use their insider knowledge to win lucrative contracts with the Executive. As a result there is an ?unhealthy relationship? bet-ween business and government, the critics claim. The Executive was forced to reveal its close links with private firms in response to a request under the Freedom of Information (Scotland) Act from the Green MSP, Chris Ballance. The bank, Lloyds TSB, is named as seconding staff to support the Executive?s financial partnerships unit and to give ?wider policy support on PPP issues?. In addition, the PPP unit is supported by staff from Partnerships UK, a UK government spin-off company. Lloyds TSB has also acted as banker to about half a dozen PPP projects in Scotland, including the ?45 million plan for six secondary schools in East Lothian and the ?9.5m new terminal at Inverness Airport. The bank is sponsoring a major Executive conference on PPP-style ?infrastructure investment? in Edinburgh on May 17-18. According to the Executive, the Royal Bank of Scotland is seconding staff to help a ?40m Enterprise In Education ?determined to succeed? drive aimed at bringing businesses closer to schools. The Bank of Scotland is helping involve local authorities and corporations in the same initiative. The Executive also discloses that the Scottish legal firm, McGrigors, provides staff to support the work of the Solicitors Office. Another company called Creative Services provides expert advice on tourism, culture and sport. ScottishPower provides staffing for the Executive?s Forum for Renewable Energy Development in Scotland, and Paul Zealey Associates supplies expertise on the ?18m Futurebuilders investment fund, which has been designed to help commercialise voluntary sector activities. ?The vested interests of the private sector are increasingly corrupting the proper administration of government,? said Professor Allyson Pollock of the School of Public Policy at University College, London, a leading opponent of PPP schemes. ?The scientific evidence which underpins policy- making within the civil service is being corrupted by the introduction of conflicts of interest which work against the public interest,? she said. This amounted to ?the corruption of the whole policy-making process?, she alleged. Individuals from private companies were becoming agents for privatisation within the government itself. ?These individuals are increasingly playing a role in designing and implementing government policies which represent interests of corporations. And government dep-artments, instead of being independent of the private sector, increasingly become captured by corporate agendas,? she said. But such accusations are denied by businesses and the Executive which argue that seconding staff is a good way of sharing experience and expertise. ?We don?t see any conflict of interest,? said a spokesman for Lloyds TSB. ?It?s useful for improving our knowledge of what?s going on. PPP is a very big sector and it?s only right that we keep abreast of what is happening in the marketplace.? He confirmed that Lloyds TSB had seconded a member of its corporate banking team to work at the Executive for six months. ?It is a good thing for us,? he said. The Scottish Executive has so far been involved in 85 PPP projects for schools, hospitals, housing and transport, worth a total of ?2.44 billion. There are a further 50 PPP schemes currently on the drawing board, whose combined worth would total another ?3.13bn. The Executive pointed out that those on secondment from companies all signed ?robust? conditions, including an explicit agreement to ensure no conflict of interest. ?We are not aware of this agreement ever having been breached,? said an Executive spokesman. ?Secondments ? in and out of the Executive ? allow us to share experience and expertise with our external partners. We have no doubt this delivers real benefits for us ? and, indeed, for the bodies we work with.? But such assurances do not convince Mark Ballard MSP, finance speaker for the Greens. ?This information exposes a serious potential for conflict of interest and should be investigated further,? he said. ?With PPP we get a major shift in controls over public money away from accountable government towards unaccountable business. Having finance companies and banks inside government working on PPP is extremely worrying.? Ben Thomson, chief executive of the Noble investment bank in Edinburgh, which has been involved in 26 PPP schemes, stressed that PPP has several advantages. Thomson acknowledged that conflicts of interest were possible, but added: ?The important thing is to be aware of them and to manage them sensibly.? |
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