Watchdog under scrutiny: Controversial Ofgas head to face tough questions from MPs over relationship (CORRECTED)

CORRECTION (PUBLISHED 26 MAY 1994) APPENDED TO THIS ARTICLE

THE allegation at the centre of the furore surrounding the appointment of Clare Spottiswoode as head of Ofgas, the industry regulator, goes to the heart of Whitehall sensitivity about patronage and accepting favours.

That Ms Spottiswoode should apply for and be appointed to the pounds 70,000 a year post and then prove to be highly controversial is one thing. That her appointment, so it is claimed, should have been promoted by John Michell, the civil servant in charge of the oil and gas industries, is quite another.

Details of the charges are expected to be laid at what will undoubtedly be a tense session of the Commons Environment Select Committee attended by Ms Spottiswoode later today. In a nutshell, they are that Ms Spottiswoode's name was not included on the list of original applicants for the job and was added by Mr Michell; she sent him a bunch of red roses after she got the post last October; and he later accompanied her on business trips to Brussels and Canada. And, so the accusations go, for a supposed watchdog, she enjoys too close a relationship - not just with Mr Michell but with other officials at the DTI and senior Tory politicians. Another cause for concern was the appointment as parliamentary lobbyists for Ofgas of Ian Greer Associates, a firm that enjoys close links with prominent Tories and has lobbied in the past on behalf of British Gas. All the parties were holding fire yesterday, ahead of the committee meeting. Robert Ainsworth, the Labour MP who received the information, was refusing to give chapter and verse. Ofgas said Ms Spottiswoode 'believes she can deal fully and comprehensively with the issues which she understands the committee intends to put to her'. The allegations 'can only divert attention from these substantive issues.'

When Ms Spottiswoode started the job, she said that she regarded the independence of the regulator as one of the most important aspects of the role.

At the DTI, a spokeswoman said an internal inquiry had been held and it was decided there were no grounds for further investigation. Mr Michell was continuing to work normally.

Significantly, for Whitehall watchers, there was no categorical denial.

The recruitment agency that head-hunted her, also refused to comment, claiming it owed a duty of confidentiality to the DTI.

CORRECTION

Ian Greer Associates have asked us to point out that they have not been appointed to work on behalf of Ofgas, the gas industry regulator, nor have they ever had any discussions with Ofgas about such an appointment.