The Advisory Committee on Business Appointments (Acoba) said that Lord Hammond’s decision to email the second most senior civil servant at his former department was “not acceptable” and broke rules on lobbying by former ministers.
Acoba polices the business activities of former ministers to ensure they do not exploit inside information and contacts after they have left office, but has no power to issue sanctions or fines for breaches.
The watchdog launched an inquiry into Lord Hammond’s email to the Treasury’s second permanent secretary, Charles Roxburgh, in July last year in relation to OakNorth bank, on whose advisory board he sits.
The Tory peer told Mr Roxburgh that the firm was “very keen to ensure that the right people” at the Treasury saw a presentation about “Covid stress-testing” software it had developed for assessing corporate borrowers.
In a letter to Acoba chair Lord Pickles, Hammond said he did not believe that the message broke lobbying rules because OakNorth was offering the government access to the software free of charge as its contribution to the national coronavirus effort.
However, it its finding today, Acoba told Lord Hammond it was “an unwise step to contact senior officials at the Treasury on OakNorth’s behalf”.
It added: “In this case, as the former Chancellor paid by OakNorth, your contact with HM Treasury raises a reasonable concern that direct engagement with the second permanent secretary was only made available to OakNorth as a direct result of your time as Chancellor.
“The committee considers the use of your contacts in government in this way was not consistent with the intention of the rules and was not acceptable.
“The material consideration is the privileged access you obtained for OakNorth, not the commercial value of the proposition.”
Lord Hammond obtained clearance from Acoba to take up his position at OakNorth in January 2020, six months after leaving goverment when Boris Johnson took over from Theresa May as prime minister.
A spokesperson for the former chancellor said:“Lord Hammond emailed the Treasury last year to confirm that the relevant people had received a free-of-charge offer of support with Covid response from OakNorth Bank.
“He was not seeking to influence policy, obtain funding or win business from the government.
“The simple question for Acoba is: did his email breach any of the restrictions that Acoba had placed upon him when approving his role with OakNorth? The answer is clearly that it did not - but Acoba‘s substantive letter dated 31 August seems unwilling to say so explicitly, instead offering opinions while avoiding a straight answer to the question of fact.”
The ruling comes soon after David Cameron, in whose cabinet Lord Hammond served, came under fire for lobbying the Treasury on behalf of the failed Greensill Capital.
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