Thursday, 18 November 2010

New ethics rules must be Verheugen-proof

On Thursday 18 November Barroso’s team of Commissioners will discuss a draft of the new Code of Conduct. Commissioner Sefcovic’s speech to MEPs ealier this month revealed some of the elements that are likely to be in the draft. An analysis by Corporate Europe Observatory (CEO) concluded that the speech marks an important departure from the previous habit of denying conflicts of interest, but that much more needs to be done to halt the revolving door.

One positive development announced by Sefcovic is online transparency around decisions made about requests for approval on new jobs and other activities by ex-Commissioners. This already exists in the UK and will – if done well – be a step forward. Similar transparency measures should be introduced as soon as possible for Commission staff moving into new jobs, something that is currently virtually covered in secrecy. But Sefcovic’s speech also left a lot unclear and was disappointing on some keys issues.

Verheugen case: 10 weeks later and still no decision

A crucial test for the new rules will be whether they clarify that cases such as the lobby consultancy firm set up by ex-Commissioner Verheugen are prohibited. The Commission (through its ad-hoc ethical committee) started an investigation in early September, but 10 weeks later there has been no indication of which way the recommendations will go or what the Commission as a whole will decide. Verheugen, who has already been given a green light for four other paid positions with large firms and lobby groups, claims that the rules do not apply to him because he is not an employee of his lobby consultancy firm. Yet he is the managing director and owns 50% of the shares in the firm. He also continues to receive a Commission pension. Scrutiny of ownership of shares, Commissioner Sefcovic mentioned, is one the likely additions to the new Code of Conduct.

The Verheugen case is crucially important because it will reveal whether the Commission prioritises protecting a former Vice-President or whether it intends to rebuild public trust. But in the future the rules should be crystal clear so a decision can be taken quickly and with determination. Not only direct lobbying, but also lobby advice should be covered by the new cooling-off period. Otherwise ex-Commissioners will continue to use the networks and insider information they have developed while in public office in ways that create conflicts of interest.