Friday, 25 November 2011

Block the revolving door!

Brussels bubble watchers might remember the names of Verheugen, McCreevy, Ferrero-Waldner, Kuneva – all former EU commissioners who left public service and went through the revolving door into lobby jobs or other jobs which provoked conflicts of interest with their former work. Their cases caused a furore and led to the development of a code of conduct for commissioners and some (slightly) tighter rules.

The names of Carl, Dethomas, Lönngren, Taylor, Westrup, are not well-known, but these EU officials have also gone through the revolving door between the institutions and the Brussels lobby industry. Some of them were at the very highest positions within the EU, yet none were the subject of a cooling-off period which would have prevented them from accepting these lobby jobs. These individuals are symbols of a major, but largely unrecognised phenomenon, and one which is at the heart of the privileged access to EU decision-making process which corporate interests enjoy.

This week, the ALTER-EU coalition, of which Corporate Europe Observatory is a steering committee member, has launched a brand new report and campaign aimed at getting new rules which would block the revolving door between the EU institutions and the lobby industry. The report makes clear that the current rules are weak, not properly applied or enforced, and contain numerous loopholes.

Take the cases listed above: Mogens Peter Carl, the former Director-General at DG Trade and then DG Environment moved to lobby consultancy Kreab Gavin Anderson just six months after leaving the Commission. Kreab represents ICI and Scania, amongst others.

Bruno Dethomas, the former Head of the European Commission’s Eastern Partnership Taskforce (looking at relations between EU and non EU states including Russia) retired in December 2010, joining lobby consultancy G+ Europe in March 2011. G+ Europe’s clients include Gazprom Export and the Russian Federation.

Thomas Lönngren was Executive Director of the European Medicines Agency (EMA) until December 2010. In January 2011, he set up his own consultancy and joined the NDA group, which specialises in advising the pharmaceutical industry. EMA only imposed limited restrictions on Lönngren after NGOs complained about the conflicts of interest provoked by these new jobs.

Derek Taylor, a senior energy adviser working for DG Energy moved to lobby consultancy Burson-Marsteller to work as an energy adviser within weeks of retiring from the Commission and without receiving authorisation. Burson-Marsteller's clients include Suez Environnement and ExxonMobil.

And finally, Mårten Westrup, an official at DG Enterprise moved to BusinessEurope, Brussels' most powerful lobby organisation, to advise on climate change issues, before returning to the Commission, to work at DG Energy. As he worked on a consultancy basis for the Commission, he was considered exempt from the revolving door rules.

These moves through the revolving door by these officials raise profound questions about conflicts of interest. Considering the likely extent of these guys' contact books, policy know-how, and insights into EU decision-making, it is no wonder that the lobby companies that now employ them are proud to trumpet them on their websites.

There is no doubt that when officials go through the revolving door, it's the lobby firms, and their clients who benefit. The officials themselves do pretty well out of it too. Some say that top EU officials can earn up to 500 euro per hour in the lobby industry. Nice work if you can get it.

And the point is that it is all too easy for these officials to get this work - the EU institutions do not appear to take the revolving door issue seriously. One immediate step they could take would be to publish a list of all revolving doors cases and what response the institutions have made to each one. Something similar already happens in the UK, but the EU appears to resist such a proactive approach to transparency. ALTER-EU also wants to see a cooling-off period of at least two years for all EU staff from becoming lobbyists and new rules to regulate lobbyists who join the EU institutions.

Join ALTER-EU to block the revolving door!


Wednesday, 9 November 2011

Gifts, shares and other loopholes – the MEP code of conduct

If a week is a long time in politics, then it appears that seven months is a veritable aeon. That's how long it has been since the Sunday Times exposed the cash-for-influence scandal which engulfed three MEPs and caused some soul-searching in the EU's only elected institution. But the shock and embarrassment that this caused seems to have faded into the distant past, at least for some Members.

MEPs on the Parliament's constitutional affairs committee are getting ready to vote on the new code of conduct, which was drafted as a response to the scandal and which is supposed to usher in a new wave of transparency and accountability among MEPs. Yet judging by some of the amendments which have been tabled, the original good intentions appear under threat.

Several problematic amendments have been tabled by Charles Tannock MEP, a British conservative. He proposes diluting the requirement on MEPs to declare shareholdings so that they would only need to declare those which consist of 15 per cent of the issued shares or where the shares' value exceeds one year's salary. An MEP earns about 84 000 euros a year, so this would potentially allow some Members to avoid declaring significant financial interests. Tannock's amendment significantly weakens the original text which calls upon MEPs to declare any shareholding which had “potential public policy implications” which presumably would cover practically all shareholdings.

But Tannock's interest in this amendment makes more sense if you look at his current declaration of financial interests. This was updated on 19 October and Tannock makes clear that, in addition to his previous declarations of unpaid directorships at the 3Legs group of companies, he also is a shareholder at 3Legs Resources (an oil and shale gas exploration company). Tannock does not reveal the value of these shares.

Tannock has tabled a further amendment, similar to that drafted by another British MEP, Andrew Duff, which would exclude hospitality from the definition of gifts. Under the new code, MEPs would be banned from accepting gifts worth more than 150 euros. The Tannock/ Duff amendments would mean that MEPs could continue to accept accommodation and other hospitality without limit. Yet hospitality in the form of good dinners and nights away are an important instrument in a lobbyist's toolbox.

Tannock himself declared an all-expenses paid trip to Taiwan (May 2011) paid by the Taiwan government office in Brussels, and a three-night stay in Jerusalem (February 2011), paid by European Friends of Israel. Under the Tannock/ Duff amendments these would be allowed; under the original, MEPs would no longer be able to accept such largesse.

Duff argues that, without his amendment, the 150 euro limit would deter MEPs from attending conferences because hotel rooms tend to cost more than this. But for important conferences, MEPs' official allowances could cover the costs, with the benefit that MEPs would not be seen to be 'indebted' to the organisation that had picked up their tab.

There are other amendments which also seek to weaken the draft code of conduct. A group of Italian MEPs have tabled amendments which would delete huge swathes of the code, on the grounds that the current rules which apply are adequate enough. But judging by the scandal in March, this is patently not true.

But even the amendments tabled by Tannock and Duff would break the cross-party consensus which agreed the draft code back in July, and would weaken it significantly. Elected MEPs should be open and transparent about their outside financial interests and they should be held to account over their conflicts of interest. The proposed code of conduct for MEPs is not perfect, but it does represent an important step forward in terms of ethics regulation within the Parliament.

At a time of falling public confidence in the EU institutions, MEPs should be doing all that they can to promote transparency and accountability. Some MEPs may have forgotten the cash-for-influence scandal in March, but European voters may have better memories.