13 Major Policies That Were Victories for Corporate Lobbyists

by Tim Holmes

The grubby paw-prints of corporate lobbyists are all over UK public policy. Here are 13 of their worst offences.

First published: 22 April, 2014 | Category: Corporate power, Politics, Privatisation, The State

Tamasin Cave and Andy Rowell’s extraordinary new book A Quiet Word: Lobbying, Crony Capitalism and Broken Politics in Britain (Bodley Head, 2014) reveals the grubby paw-prints of corporate lobbyists all over UK public policy—rigging debate, swaying policymakers and crushing opponents. Here, drawing on their research, are 13 of the lobbyists’ worst offences over recent decades.


1. Blocking regulation of sugar

The sugar industry has fought a successful, decades-long battle against regulation, for which it won a prestigious Silver Anvil award for PR. It used tobacco-industry tactics: denying evidence of harm, creating the impression of scientific uncertainty and vilifying critics, while eulogising 'freedom' and 'personal responsibility'. It denied sugar’s links to disease, challenged 'misconceptions' about tooth decay and employed scientists—some funded by big tobacco—to exonerate sugar in research, media and before government. It funded nutrition journals and professional medical and nutritional bodies. It attacked independent scientists. When the World Health Organisation raised concerns, the industry threatened to demand the US government pull its funding for the body; the WHO called these tactics far worse than the tobacco industry’s. The UK government has in recent years taken only 'ineffective, vague and voluntary' measures on sugar, while the industry is battling a proposed tax by misleading the public. Pepsi and its PR people now help the government devise anti-obesity and dietary education programmes.


2. Enabling corporate tax avoidance

HMRC’s Dave Hartnett, who cut 'sweetheart' tax deals with large corporations, became notorious as Whitehall’s most wined and dined civil servant. But the rot does not stop there. The government regularly invites big accountancy firms—accused of 'manufacturing tax-avoidance schemes on an industrial scale'—to help shape tax policy. Many become 'poacher, turned game-keeper, turned poacher', travelling from company to government and back again, using insider knowledge to help clients avoid tax, or even to change tax law on their behalf. Ernst & Young market the latter as pre-emptive tax avoidance, posing lower risks of negative publicity and government action. The government also lets tax directors of large businesses help develop tax policy, including reforms to corporation tax. These include what former tax inspector Richard Brooks has called 'self-evidently very generous moves that encourage tax haven activity'. BP’s head of tax calls the corporate-friendly tax system 'the result of ten years’ hard work'.


3. Preventing action on climate change

In the nineties, oil giant ExxonMobil and the American Petroleum Institute formed a Global Climate Science Team to promote the fiction of scientific 'uncertainty' about man-made climate change. Exxon funded a network of scientists and corporate think tanks—including the Competitive Enterprise Institute, the Heartland Institute and the Institute for Economic Affairs, all recipients of tobacco industry money—which Britain’s Royal Society concluded had 'misrepresented' climate science by exaggerating uncertainty and 'outright denial of the evidence'. These days, oil billionaires the Koch brothers and other, anonymous billionaires fund the same projects.

In Britain, lobbying firm Foresight Communications and quarryman Robert Durward, director of the British Aggregates Association, formed The Scientific Alliance to lobby against environmental policy. The Association and Durward’s Lancashire quarry share the group’s phone number. Durward’s New Party, for which Foresight lobbies, mounted a legal challenge to prevent Al Gore’s film on climate change being shown in schools. The Alliance’s Benny Peiser and oil industry-linked Nigel Lawson would later run climate change-denial think tank the Global Warming Policy Foundation from the offices of the Institute for Materials, Minerals and Mining. The GWPF refuses to reveal its funders.

The campaign has been 'devastatingly effective'—moulding opinion, blockading policy and smearing climate science.


4. Privatising education

Under Michael Gove, over half of England’s secondary schools have become independent 'academies', and over 180 'free schools' have been approved. These offer profiteers an open door into the education market, enabling them to undermine teachers’ 'pay, conditions and recruitment'. Scaremongering about a phony education crisis provides cover, scapegoating schools and teachers for economic problems, teenage pregnancies and underage drinking. The Department for Education has handed half a million pounds to lobbyists managed by academy operators and financiers, and linked to the US school privatisation lobby—itself bankrolled by technology, media and financial companies—and the education arm of Murdoch’s News Corp, with which Gove has strong political and financial ties. Technology giants with interests in education have lobbied Gove to open up schools to their products.

Think tanks like the corporate-backed Institute for Economic Affairs, Centre for Policy Studies and Centre for Market Reform of Education produced policy, influenced media and supplied practical assistance, fighting what one reformer called 'a huge battle in an already very long war'. Gove’s former think tank Policy Exchange—funded by academy chain sponsors, outsourcing firms and education investors, as well as media and technology interests—helped staff his department, promoting his reforms in media and government.

Following the 2010 election, unproven, 'oven-ready' school reforms were rapidly pushed through.


5. Opposing fairer votes

One lobbyist notes that his 'comrades' the Taxpayers' Alliance (TPA) 'provided the firepower' for the NOtoAV campaign against a fairer voting system. Why would the 'Taxpayers' Alliance' derail an improvement to Britain’s democracy that would have empowered taxpayers?

Perhaps because it does not represent them. The TPA is funded by wealthy Tory donors. It networks with 'astroturf'—fake grassroots—organisations like Americans for Prosperity, bankrolled by oil billionaire David Koch. TPA members have become Cameron’s chief of staff and Press Secretary. Its former campaigns director James Frayne helped Michael Gove spin school reform; provided strategy advice to the Conservatives; and worked for corporate lobbyists including Westbourne Communications, which backed the TPA’s anti-50p tax campaign. In a 2013 book, Frayne advises businesses to 'become experts in public persuasion', leading the public conversation by replacing 'backroom lobbyists' with 'permanent' campaigns pushing their agenda. Florence Heath, the TPA’s co-founder, works for Shell.


6. Greenwashing fracking and the new 'dash for gas'

After 18 months of intensive industry lobbying, in 2012 the EU declared gas a 'low-carbon' energy source. An R&D fund for clean technology now includes gas—potentially diverting billions from emerging renewables and into a mature, polluting fossil fuel industry. A concerted campaign by corporate lobbyists Bell Pottinger, the government, the press and business-linked think tanks presents shale gas as climate friendly, smearing opponents as wealthy and selfish naysayers.


7. Blocking alcohol regulation

After tobacco firm Philip Morris bought Miller Beer in 1970, Miller pledged to 'fight aggressively' against regulation, and began to adopt tobacco industry tactics. Guy Smith, formerly of Philip Morris, began supervising crisis management for alcohol giant Diageo. In the eighties, the cross-industry Portman Group was formed. Like big tobacco, the alcohol industry undermined scientific research, portraying itself as responsible and emphasising personal choice. Portman misrepresented evidence, funded academics who lobbied to relax drinking guidelines, offered money to scientists to rubbish WHO research, and scapegoated a 'reckless minority' of problem drinkers. (In reality, 10 million adults drink too much, and higher average drinking creates more alcoholics.) Drinks giants forestalled regulation by presenting a 'responsible' image and creating ineffective 'alcohol education' campaigns. Portman attacked minimum alcohol pricing in Scotland through the courts, arguing—as cigarette companies did of plain packaging—that it breached EU competition laws. In England, its populist 'Why Should We Pay More?' campaign fomented opposition (though in fact the measure barely raises average bills, instead targeting heavy drinkers). Alcohol lobbyists colluded with Andrew Lansley’s Department of Health, ensuring it produced only ineffective, voluntary guidelines. One held such frequent meetings at the Department that he was mistaken for a civil servant.


8. Cutting taxes for the rich

Ever since April 2009, when then-Chancellor Alistair Darling announced a 50p tax rate for the highest earners, the policy has faced a constant onslaught in the press. Two years after the Telegraph echoed its warnings of 'dire economic consequences' of a revived 50p top rate, one lobbyist was 'pleased' that his 'comrades' the Taxpayers’ Alliance 'continue to exert remarkable influence on the tax debate'. Lobbyists Westbourne Communications (which have employed the TPA’s campaigns director) joined the anti-50p tax campaign, which placed supportive third-party voices in the media, some bogus. Diageo’s director threatened to divest and 'create jobs' elsewhere, warning of 'long-term damage' to Britain’s economy. This was scaremongering: most companies are not this mobile, and higher-tax economies rank among the most successful on a range of key indicators. Threatened by the prospect of a windfall tax on bonuses and a resilient 50p top tax rate, bankers threatened a massive exodus to Switzerland. (In fact, the number leaving fell.)

Though the public still supported the 50p tax, in 2012 it was axed.


9. Promoting pesticides

The 'Crop Protection Association', which represents pesticide companies, hired PR firm Hill & Knowlton to thwart a proposed tax on pesticides. To avoid opposition from NGOs—which blame pesticides for decimating bee populations and posing health risks to the public—the firm worked to sustain a media blackout on the issue, while using carefully-placed articles in the farming press to drum up opposition among farmers. The tax was abandoned, and Hill & Knowlton’s campaign praised by the PR industry’s 'excellence awards'.


10. Privatising the NHS

NHS 'reform', a central plank of the Coalition's policy agenda, was born of commercial lobbying, vested interests and state-corporate collusion. The health industry coordinated its messages with No. 10, ensuring they sang from 'common hymn sheets'; the NHS regulator, the Health Minister and industry lobbyists collaborated to attack uncooperative health boards. 142 Lords—including the Tory peer that led the Lords privatisation debate—are linked to private health interests. Tory-founded, industry-funded 'think tank' Reform acted as a credible 'outside commentator' for health companies, helping place a 'whole sequence' of supportive articles in the media, while health contractors McKinsey advised government—sometimes on political strategy—even as it relayed official information to clients and brokered meetings between industry and government officials. Senior health officials—including the former head of commissioning, who advised investors to 'take advantage' when the NHS was 'shown no mercy'—left to join private health interests. Another joined a lobbying firm, helping corporate clients influence health policy.


11. Blocking bank regulation

Justifying bonuses during austerity, one financial specialist observed, would be a 'big job'. Facing public anger, the banks formed TheCityUK—a 'trade body shouting off one hymn sheet' designed to 'restore the reputation' of banks by 'casting' them 'as a vital national asset'. The Treasury and Mayor of London commissioned reports from City insiders pushing the same line. TheCityUK promoted myths about the economic harms of regulation. It hosted senior journalists from the BBC, ITV and others, seeking advice on perception management and offering to help journalists improve bankers’ image. The Sunday Telegraph’s deputy political editor even joined the British Bankers’ Association to bolster its 'positive campaigning'. When European regulators sought to restrain hedge funds, the industry moved to 'thwart' them—in Goldman Sacks CEO Lloyd Blankfein’s words—warning of 'very negative social consequences across Europe' for schools, hospitals, shops, businesses and pensions. Boris Johnson promised to do his 'utmost' to block regulation.

With the banks’ framing dominating the public conversation, financial regulation remains weak and dysfunctional.


12. Fleecing the public sector

The Confederation of British Industry, Britain’s principal business lobby group, has backed the disastrous Private Finance Initiative (PFI) since the early nineties. One advocate called PFI the Heineken of privatisation, helping business reach previously untouched parts of the public sector. By requiring public sector projects to raise private capital, PFI has forced local authorities to bypass cheaper and more convenient options and lumbered NHS trusts with massive debts, forcing mass closures of hospital services. The National Audit Office damned PFI in 2011, and George Osborne promised a review, but the City lobbied successfully to preserve it.


13. Blocking restrictions on cigarette marketing

Tobacco companies mounted a massive pushback against plans to introduce mandatory 'plain packaging' for cigarettes, working to inundate a government consultation with industry-friendly submissions. Cigarette packets promoted a campaign website crafted by Tea Party-linked lobbyists. Paid to collect petition signatures for tobacco industry front-group Forest’s 'Hands Off Our Packs' campaign, canvassers faked and inveigled them. The industry bankrolled sympathetic rural shops' and wholesalers' groups, while PR firms, advertisers and think tanks—including the Taxpayers’ Alliance and Institute for Economic Affairs—helped lobby. Former police officers linked to the tobacco industry appeared in media and submissions to government, claiming plain packaging would worsen smuggling. Lobbyists asked local officials to approach MPs, and targeted over 100 directly.

The campaign succeeded: in 2013, plain packaging was shelved.


Tim Holmes is a freelance writer and researcher based in mid-Wales.


Correction: a previous version of this article said that plain packaging had been 'dropped' in 2013; 'shelved' is more accurate.

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