Decision

Summary of business appointments applications - Lord Macpherson

Updated 24 August 2017

Lord Macpherson left his role as Permanent Secretary, HM Treasury, in March 2016.

1. Board Member, UK Finance

Lord Macpherson sought advice on taking up a new, unpaid role as a board member of UK Finance. This is to be a part-time role involving around four to six two hour meetings a year.

UK Finance is a new trade association bringing together various bodies representing the financial services industry. Lord Macpherson noted that UK Finance will seek to reach strategic positions on the future of the industry and seek to influence other organisations accordingly. Lord Macpherson was asked to join in his role as Chairman of C Hoare & Co to represent the interests of small private banks.

The Committee took into account the following factors:

• Lord Macpherson would have been involved in many fiscal decisions affecting banking (which, as HMT confirmed, included increasing the bank levy and corporation tax burden on the industry). Further, HMT noted that he was also involved in decisions to sell HMT’s holdings in Lloyds and RBS; and he was responsible for HMT during the passage of several major Acts of Parliament, which restructured and strengthened bank regulation.
• UK Finance did not exist when Lord Macpherson was Permanent Secretary; however, he told the Committee that he had met some of its predecessor bodies from time to time to discuss industry issues, in particular regulation.
• HMT noted that Lord Macpherson left the Treasury 15 months ago and explained that the issues of relevance to UK Finance at present (mainly Brexit related) were not being considered during his time as Permanent Secretary.
• HMT noted that while he would have had access to information about individual banks that are members of UK Finance, UK Finance’s role as a trade association is not to discuss individual bank issues, but rather broader, industry wide, issues. Further, HMT considered that any information about individual banks that Lord Macpherson would have ben privy to would now be out of date.
• UK Finance will be engaging with Government to represent the interests of the financial services industry. However, Lord Macpherson will not engage with Government himself; and will recuse himself from any lobbying activity.
• The current Permanent Secretary at the Treasury has no reservations about this appointment.

The Prime Minister accepted the Committee’s advice that this appointment be subject to the following conditions:

• he should not draw on (disclose or use for the benefit of himself or the organisation to which this advice refers) privileged information available to him from his time in Crown service; and
• for two years from his last day in service, Lord Macpherson should not become personally involved in lobbying the UK Government on behalf of UK Finance or its members or make use, directly or indirectly, of his contacts in Government and/or Crown service to influence policy or secure business on behalf of UK Finance or its members.

The letter containing the final advice was sent in July 2017 and the appointment was made public the following month.

2. Non-executive Director, British Land plc

Lord Macpherson sought advice on accepting an appointment as non-executive director of British Land plc.

The Committee noted that the role would be a paid, part-time position, involving 12-18 days’ work per year. It is not likely to include any contact or dealings with either the Treasury or with Government more widely.

When considering this application the Committee took into account that Lord Macpherson had no contact with the company while in post; that HM Treasury had no concerns about the appointment and that eight months had passed since Lord Macpherson’s last day in Crown service.

The Prime Minister accepted the Committee’s advice that, in accordance with the Government’s Business Appointment Rules, the appointment be subject to the following conditions:

• He should not draw on privileged information available to him from his time in Crown service; and
• For two years from his last day in service, Lord Macpherson should not become personally involved in lobbying the UK Government on behalf of British Land plc, or make use, directly or indirectly, of his contacts in Government and/or Crown service to influence policy or secure business on behalf of British Land plc.

The letter containing the final advice was sent in December 2016 and the appointment was taken up later that month.

3. Non-executive Director, Scottish American Investment Trust

Lord Macpherson sought advice on accepting an appointment as non-executive director of the Scottish American Investment Trust. The role would involve around six days’ work per year and would not include any contact with HMT or Government more generally.

The Committee took into account that Lord Macpherson had no dealings with the Trust while in post. Neither did he have any contact with Baillie Gifford, the asset management firm that manages the Trust. HM Treasury has confirmed that, other than in relation to general tax policy, which affects all companies, he has had no direct involvement in policy making that could affect the Trust.

The Committee also took into account that HM Treasury had no concerns about the appointment and that nearly six months have past since Lord Macpherson’s last day in Crown service.

The Prime Minister accepted the Committee’s advice that there was no reason why Lord Macpherson should not take up this position, subject to the following conditions:

• He should not draw on (disclose or use for the benefit of himself or the organisation to which this advice refers) privileged information available to him from his time in Crown service; and
• For two years from his last day in service, Lord Macpherson should not become personally involved in lobbying the UK Government on behalf of Scottish American Investment Trust or its parent company, Scottish American Investment Company plc, or make use, directly or indirectly, of his contacts in Government and/or Crown service to influence policy or secure business on behalf of Scottish American Investment Trust or its parent company.

The letter containing the final advice was sent in September 2016 and the appointment was taken up later that month.

4. Chairman, C Hoare & Co

Lord Macpherson sought advice on accepting an appointment as Chairman of C Hoare & Co, a small retail bank. This would be a part time role, involving around two days work per week, and would not include any contact with HMT or Government more generally.

The Committee noted the following facts about HMT’s relationship with banks:

• While HMT sets the overall legislative framework within which banks operate, it has no role in regulatory decisions as regards individual banks;
• Decisions concerning the Prudential and Conduct Regulation of banks are taken by the PRA and FCA respectively;
• These regulators have statutory independence from HMT, with their own boards and independent decision making processes;
• On tax, HMT sets the overall tax regime, but has no role in the tax affairs of individual companies, which are handled by HMRC, completely independently of HMT.

The Committee noted that HMT had contacted potential competitors of C Hoare & Co about this move, none of whom raised any concerns.

The Committee noted that, as a former Permanent Secretary, Lord Macpherson is subject to the standard three month waiting period from his last day of service. Given HMT’s oversight of financial services, the Committee considered whether an additional waiting period was appropriate in this case. However, it took into account the views of HMT and Cabinet Office, including specific details about the relationship between C Hoare & Co and HMT, the fact that there does not appear to be any reasonable perception of reward with the move, and that potential competitors have been consulted and have no concerns. The Committee therefore concluded that the three month waiting period for Permanent Secretaries would be a sufficient gap in this case.

The Prime Minister accepted the Committee’s advice that there was no reason why Lord Macpherson should not take up this position, subject to the following conditions:

• A waiting period of three months from his last day in Crown service;
• He should not draw on (disclose or use for the benefit of himself or the organisation to which this advice refers) privileged information available to him from his time in Crown service; and
• For two years from his last day in service, Lord Macpherson should not become personally involved in lobbying the UK Government on behalf of C Hoare & Co or its clients, or make use, directly or indirectly, of his contacts in Government and/or Crown service to influence policy or secure business on behalf of C Hoare & Co.

The letter containing the final advice was sent in July 2016 and the appointment was announced that month.