Transparency of Interests and Avoiding ‘Sleaze’

There is a very clear lack of any form of independent and publicly available review of interests in relation to unconventional gas policy development and decision making. Therefore the Alliance calls for:

A full review to establish transparency of interests and take action against apparent conflicts of interests within and between industry and government.

Such a review must cover:

  • Elected and unelected government roles, paid and unpaid roles i.e. including all unelected business representatives on boards of government departments, etc. – for example:
    • The chairman of unconventional gas company Cuadrilla, Lord Browne, sits in probably the most powerful and certainly the most influential unelected role inside government as the senior business representative in government, appointed by Francis Maude to the Cabinet Office. Lord Browne has ‘told the Guardian he would invest whatever it takes – potentially running to billions of pounds – in the shale dash for gas’. See www.theguardian.com/environment/2013/mar/13/fracking-cuadrilla-halts-operations-lancashire
    • In relation to shale gas, on Jan 13th 2014 the Government announced: “We have streamlined and simplified the regulation of exploration activity through the Environment Agency, including developing a single application form for permits and we will go further in 2014.” So, who oversees streamlining in government?
    • Lord Browne, Chair of Cuadrilla, has a lead role in overseeing the ‘streamlining’ in government and public agency decision making – this represents a massive, obvious and highly inappropriate conflict of interest.
    • Whilst he was CEO of BP Lord Browne instigated ‘streamlining’ of business procedures, an approach which was maintained by his successor Tony Hayward – many commentators see this cost-cutting strategy as being linked to the world’s largest oil disaster, The Deep Water Horizon disaster, the ultimate cost of which to BP will be more than $20 billion in compensation, as well as huge damage to BP’s business reputation.
    • It is understandable that Lord Browne should take these roles in government if he can – unpaid as they are, he will secure massive financial benefits if the ‘dash for gas’ has any success through his role with Cuadrilla. It is highly inappropriate that our politicians have enabled and continue to support this massive conflict of interest – in particular action should be taken against David Cameron’s support for the ‘dash for gas’ in the light of this major conflict of interest, and against Francis Maude (MP for Balcombe) for facilitating this conflict of interest. Other unelected business appointments in government include Sam Laidlaw, chief executive of Centrica, which holds a 25% Cuadrilla’s shale gas license areas in the Bowland basin, near Blackpool.
    • Not only should Lord Browne be removed from this position but also:
      1. A thorough review of his influence on streamlining decision making in relation to shale gas exploitation should be undertaken.
      2. A full reversal of streamlining should be undertaken where this is seen as potentially impacting risk assessment and analysis, with potential adverse impacts on citizen and environmental health.
  • Financial and business interests, including interests by inheritance, to politicians and business representatives with a role in government:
    • current benefits and potential future benefits
    • direct and indirect i.e. including close family members, or friends etc
  • Any substantial influence on analysis, risk assessment and decision making processes of relevant Government departments and public bodies;
    • E.g. any role (such as that of Lord Browne) that has allowed, encouraged or enabled fast-tracking of analysis and / or decision-making in relation to unconventional gas industry activities, including reduced consultation periods, where this might influence decision making in one way or another or benefit the person in that role;
  • The influence of vested interests on advisory reports to politicians and decision making bodies such as the Environment Agency (EA), Department of Energy and Climate Change (DECC), Department of Environment, Food and Rural Affairs (DEFRA), Department for Communities and Local Government (DCLG), etc.
  • Any influence that the design and implementation of ‘efficiency savings’ and ‘civil service reform’ might have had in compromising or influencing decision making in relation to public consultation and involvement in policy;
  • Independence or relevance of experience of any key advisors e.g. PM’s / Ministerial energy policy advisers.

Other areas of existing or potential conflict of interest that need to be made transparent and removed where necessary include:

  • County Councils involved in granting planning applications to unconventional gas companies should not hold investments in the unconventional gas industry. An examples of this is that a Freedom of Information Act request suggests that West Sussex County Council’s pension portfolio includes over £82.5 million invested in 13 companies involved in the gas / oil industry. Although members of WSCC’s Planning Committee are not involved in the management of the Pension Fund investments, the Officers who advise and liaise with the Councillors would stand to gain the most from the success of the oil and gas industries, Cuadrilla and IGas in particular (source: Frack Free Sussex facebook page)
  • Stoke County Council has set up an energy company to extract coal bed methane www.stokesentinel.co.uk/Councillors-directors/story-20024325-detail/story.html

Other relevant political interests:

  • The Environmental Audit Committee should report on how any Government / Ministerial pursuit of the ‘dash for gas’ might relate to or be in conflict with other core areas of Government policy, such as in relation to core DEFRA policies:
  1. Maintaining secure water supplies, high standards of drinking water and effective sewerage services
  2. Protecting and enhancing our urban and natural environment to improve public health and wellbeing
  3. Making sustainable development a part of all government policy and operations
  • Potential failure to undertake proper assessment of risk to and protection of designated special landscape areas i.e. AONB (Area of Outstanding Natural Beauty) – e.g. in relation to European Landscape Convention, including appropriate public and stakeholder engagement

Specifically a full review would need to identify:

  • Any failure of the Minister for the Cabinet Office to properly protect the electorate against conflict of interest in installing and oversight of business representatives in government roles, whether that is in terms of a) their formal role, or b) their ability to influence decision makers outside of their formal role, through the access to senior decision makers that their role affords.

For undertaking a full and proper review of conflicts of interest and any inappropriate influence on decision making, the following would have some role:

  • Public Administration Select Committee
  • The Ministerial Code
  • Sir Alex Allen – PM’s independent adviser on ministerial standards

In essence, there is now a lack of distinction between industry and central government – and therefore a lack of independence and robustness in policy formation and regulation. This is illustrated by the following extract from the document ‘Enhanced Departmental Boards: Protocol’ published by the Cabinet Office (19 Feb, 2013) under Francis Maude, which clarifies the role of unelected business representatives which have been brought inside government to sit on the Boards of government departments:

They [non-executive board members from outside government] will exercise their role through influence and advice, supporting as well as challenging the executive. They will advise on performance (including agreeing key performance indicators), operational issues (including the operational/delivery implications of policy proposals), and on the effective management of the Department. They will also provide support, guidance and challenge on the progress and implementation of the operational business plan, and in relation to recruiting, appraising and ensuring appropriate succession planning of senior executives. They will form committees responsible for Audit and Risk, and Nominations and Governance. To share best practice and to ensure Departments learn from the successes and failures of comparable organizations, they will meet regularly with other non-executives across government and the Government Lead Non-Executive Board Member [Lord Browne].

It is not clear if the Minister for the Cabinet Office has put in place any system of oversight and action at all in relation to conflicts of interest and potential ‘Sleaze’ in relation to the unelected roles ‘non-executives’ in government. If so, this would appear to represent a massive failure in terms of government responsibility to ensure the rights of the electorate are maintained and protected.

Other conflicts of interest include:

  • Former conservative party fundraiser, Algy Cluff, of Cluff Natural Resources has been granted onshore and offshore unconventional gas licenses giving rights and interests to billions of tons of coal in Carmarthenshire and the Dee Estuary, the North Wales/Merseyside border, the Firth of Forth near Kincardine, Scotland, North Cumbria and Largo Bay – two of these licenses are stated to be ‘low cost’ licenses – see: www.energy-pedia.com/news/united-kingdom/new-153070

Other sources that suggest there is a significant need for a thorough investigation of conflicts of interest include:

The Safety in Fossilfuel Exploitation Alliance