Decision

Advice letter: Philip Hammond, commission with Purl Partnership Limited

Updated 25 November 2021

You sought the Committee’s advice on taking up a commission with Purl Partnership Limited (Purl) under your independent consultancy, Matrix Partners Ltd.

1. The Committee’s role and remit

As you will be aware, it is the Committee’s role to advise on the conditions that should apply to appointments or employment under the Government’s Business Appointments Rules for Former Ministers (the Rules), which apply to former Ministers for two years after they leave office. The Rules seek to counter suspicion that:

• the decisions and statements of a serving Minister might be influenced by the hope or expectation of future employment with a particular firm or organisation; or

• an employer could make improper use of official information to which a former Minister has had access; or there may be cause for concern about the appointment in some other particular respect.

When the Committee considers applications, it must have in mind that Government has judged that it is in the public interest that former Ministers with experience in Government should be able to move into business or into other areas of public life, and to be able to start a new career or resume a former one. It is equally important that when a former Minister takes up a particular appointment or employment, there should be no cause for any suspicion of impropriety.

It is not the Committee’s role to pass judgment on whether an appointment is appropriate or suitable in any other regard.

2. Appointment details

You sought the Committee’s advice on taking up a role with Purl, a small group of private investors who invest in early stage growth businesses and agree to provide advice and support to their investee companies in exchange for being given privileged access to the investment opportunity. You informed the Committee you have been asked to become a partner and will meet with other partners to consider investment opportunities, investing on a discretionary basis as opportunities arise. Al Lukies is a partner, who was and remains the Prime Minister’s Business Ambassador for Fintech (and a Member of the Prime Minister’s Business Council). You said you will work with the other partners to support and advise on the businesses in which they are collectively invested. You do not expect this role to involve contact with government.

You informed the Committee that you did not meet with Purl while in office but from a previous application the Committee noted you had occasional contact with Al Lukies at official events in the capacity of Mr Lukies role as the Prime Minister’s Business Ambassador for Fintech. You stated there is no relationship between Purl and your former department HM Treasury (HMT) and as such you were not involved in awarding any contracts or funding to Purl. You further confirmed you were not involved in relevant policy decisions or development; nor did you meet with competitors of Purl; nor have access to commercially sensitive information on these competitors.

The Permanent Secretary at HMT was consulted about this application. HMT confirmed the above statements, adding, you were involved in policy decisions that affected many sectors of the economy, your engagement with small businesses would not have been with specific companies (such as Purl or early stage growth businesses) but rather with representative bodies such as, for example, the Federation of Small Businesses and the British Chambers of Commerce. It further confirmed any unannounced policy or sensitive information you had access to would no longer be up to date or sensitive due to the passage of time.HMT confirmed it has no concerns with this appointment.

3. The Committee’s consideration

The Committee^{[footnote 1]} noted that this commission is consistent with the description of your consultancy which you described as a vehicle for development of an advisory and consultancy business, offering advice to companies and organisations in the UK and overseas.

When considering this application, the Committee noted that while you did not meet with Purl while in office you did meet with Mr Lukies in his capacity as the Prime Minister’s Business Ambassador for Fintech. However, the Committee took into account that you were not involved in any decisions with regard to Purl specifically and it does not have a relationship with your former department. Therefore, there is nothing to suggest you made any decisions whilst in office with the expectation of a future role as such the Committee considered the risk you were offered this role for decisions made in office as low.

As former Chancellor, the Committee noted you have significant knowledge of fiscal and monetary policy, including taxation and trade policy. It may be perceived this information could offer Purl with an unfair advantage as it might appear as though you can offer Purl information on investments that might not be available to other investment companies. However, whilst Purl stands to gain from your profile, skills and experience in these matters, there are significant mitigating factors which reduce the scope for you to offer an unfair advantage to your new employer. The Committee gave weight to HMT’s view that it has no concerns in you taking up this commission and the passage of time since your last day in office (14 months) significantly reduces the risk any sensitive information you had access to would still be sensitive or up to date. Further, the Committee recognised HMT’s previous confirmation that the significant changes in the economic landscape since, which reduces the significance of the information you had access to at the time.

The Committee also noted that during your time as Chancellor you would have led on Brexit related policy and ‘no-deal’ planning. The Committee recognised that negotiations are still ongoing, with respect of the UK’s future relationship with the UK, so there could be a risk, however small, you might offer an unfair advantage with regard to your insight here. Therefore, the Committee would draw your attention to the ban on use of privileged information that applies to all former Ministers. In this context, it would remind you this prevents you from advising on matters related to the UK’s exit from the EU insofar as it relates to your time in office, including ongoing negotiations between the UK and other countries where it would draw on privileged insight.

Given your role and profile as the former Chancellor of the Exchequer, there is a risk it could be perceived your contacts might assist Previse. The Committee considered the conditions attached to your consultancy to prevent the improper use of contacts to the unfair advantage of Purl, in particular the ban on providing advice on the terms of, a bid or contract relating directly to the work of the Government.

Taking into account the above, in accordance with the Government’s Business Appointment Rules, the Committee advises your work with Purl Partnership Limited be subject to the same conditions as your independent consultancy:

• that you should not draw on (disclose or use for the benefit of yourself or the organisation to which this advice refers) any privileged information available to you from Ministerial office. In the context of this general provision, the Committee considers you should specifically avoid giving those you advise under your independent consultancy, or its subsidiaries, partners or clients, privileged insight into the Brexit related issues, insofar as it as it pertains to the negotiating position of the UK Government and other parties to the negotiations prior to the date upon which you left ministerial office, whether generally or regarding fiscal matters;

• for two years from your last day in ministerial office, you should not become personally involved in lobbying the Government on behalf of those you advise under your independent consultancy (including parent companies, subsidiaries and partners). Nor should you make use, directly or indirectly, of your government and/or Ministerial contacts to influence policy, secure funding/business or otherwise unfairly benefit those you advice under your independent consultancy (including parent companies, subsidiaries and partners);

• for two years from your last day in ministerial office, you should not become personally involved in lobbying contacts you have developed during your time in office and in other Governments and organisations for the purpose of securing business for any company or organisation (including parent companies, subsidiaries and partners);

• for two years from your last day in ministerial office, you should not provide advice to any company or organisation on the terms of, or with regard to the subject matter of, a bid with, or contract relating directly to the work of the UK Government; and

• for two years from your last day in ministerial office, before accepting any commissions for your independent consultancy and or/before extending or otherwise changing the nature of your commissions, you should seek advice from the Committee. The Committee will decide whether each commission is consistent with the terms of the consultancy and consider any relevant factors under the Business Appointment Rules .

By ‘privileged information’ we mean official information to which a Minister or Crown servant has had access as a consequence of his or her office or employment and which has not been made publicly available. Applicants are also reminded that they may be subject to other duties of confidentiality, whether under the Official Secrets Act, the Ministerial Code/ Civil Service Code or otherwise.

The Business Appointment Rules explain that the restriction on lobbying means that the former Crown servant/Minister “should not engage in communication with Government (Ministers, civil servants, including special advisers, and other relevant officials/public office holders) – wherever it takes place - with a view to influencing a Government decision, policy or contract award/grant in relation to their own interests or the interests of the organisation by which they are employed, or to whom they are contracted or with which they hold office.”

I should be grateful if you would inform us as soon as you take up this consultancy and/ or commission, or if it is announced that you will do so. We shall otherwise not be able to deal with any enquiries since we do not release information about appointments that have not been taken up or announced. This could lead to a false assumption being made about whether you had complied with the Ministerial Code. Similarly, I should be grateful if you would inform us if you propose to extend or otherwise change your role with the organisation as depending on the circumstances, it might be necessary for you to seek fresh advice.

Once this consultancy is in operation, or has been publicly announced, we will publish this letter on the Committee’s website, and where appropriate, refer to it in the relevant annual report.

1. This application for advice was considered by Sir Alex Allan; Jonathan Baume; Richard Thomas; Mike Weir; Lord Larry Whitty; Dr Susan Liautaud; The Rt Hon. Lord Eric Pickles and John Wood. ↩