Source · Select Committees · Public Administration and Constitutional Affairs Committee
Recommendation 8
8
Rejected
Paragraph: 39
Update the Corporate Governance Code to reinstate non-executive board member independence and restrict politically connected appointments.
Recommendation
The Committee recommends that the Corporate Governance Code is updated to reinstate the “independence” of non-executive board members, which was removed from the 2011 and 2017 editions of the Code. The updated Code should outline the expectation that Secretaries of State should avoid appointing individuals with clear political or personal connections, including former or current Special Advisers, serving Members of Parliament or Peers, to NED roles. In the event that any are appointed, there should be a clear justification for doing so in the governance statements of departments’ annual report and accounts.
Government Response Summary
The government rejects the recommendation to reinstate 'independence' and avoid appointing individuals with political connections, arguing that such exclusions are not aligned with existing codes or are inappropriate for former Special Advisers and serving Peers.
Paragraph Reference:
39
Government Response
Rejected
HM Government
Rejected
Within the current NEBM cadre, there are no current Special Advisers. There is no intention for this position to alter, given serving Special Advisers are civil servants. However, as stated above, an exclusion for former Special Advisers would not align with the Governance Code for Public Appointments, which states that previous or current political activity is not a bar to appointment. A former Special Adviser who has also pursued a varied career can be a valuable and independent contributor to a departmental board. Again, it is not clear why former Special Advisers could not serve, but a former Member of Parliament could. There are no serving MPs within the NEBM cadre. The House of Commons Disqualification Act 1975 also restricts MPs being members of certain public bodies, as set out in the Act. The Code of Conduct for Board Members of Public Bodies does not provide a prohibition otherwise, but requires that Board Members must not be ‘embroiled in matters of political controversy’. There are six serving Peers within the current NEBM cadre. The appointment term of one individual will end in September 2023. As stated above, we do not agree that there should be restrictions on members of the House of Lords holding a public appointment.