The Irish Times view on Michael D’Arcy’s new job: Sipo needs new powers

Laws to police a “revolving door” between government and business require tightening

The decision of former junior minister at the Department of Finance Michael D’Arcy to retire from politics in order to head up the Irish Association of Investment Managers highlights the need to tighten the rules that govern the transfer of people between business and politics. Photograph: Dave Meehan

The decision of former junior minister at the Department of Finance Michael D’Arcy to retire from politics in order to head up the Irish Association of Investment Managers highlights the need to tighten the rules that govern the transfer of people between business and politics. Photograph: Dave Meehan

 

The decision of the senator and former minister of state at the Department of Finance Michael D’Arcy to retire from politics to head up the Irish Association of Investment Managers, a finance industry group, highlights the need to tighten the rules that govern the transfer of people between business and politics.

Political office-holders and those who serve them are entrusted with power they are bound to use in the public interest. They are well-paid and pensioned, and with their position come the contacts and insider knowledge that can be extremely valuable to bodies who seek to influence the policymaking process.

The D’Arcy case illustrates the situation nicely. Until three months ago, he was the minister responsible for precisely the area in which his new employers are active. Indeed, lobbying returns show that he was lobbied by the group in recent years. Just last week, in the Seanad, he spoke in favour of a Bill for which the funds industry has lobbied for years.

Now, suddenly, he is on the other side of the fence. Last week, public interest; this week, private interest.

Rules governing the post-retirement employment of senior officials and politicians require them to notify the Standards in Public Office Commission and to obtain the watchdog’s permission to engage in commercial activity in an area related to their previous public employment. Otherwise, they may not lobby, or even work for an organisation that is engaged in lobbying. Following the controversy over D’Arcy’s appointment, the IAIM now says that neither he nor the organisation will engage in any lobbying for a year. It is an odd position for an industry group.

D’Arcy has been an able and conscientious public servant and he is entitled to pursue a career after politics. But the rules are there for a reason: we know the dangers inherent in a too-close relationship between business and politics.

Laws to police a “revolving door” between government and business are common in western democracies. In Ireland, they require tightening. Earlier this year, the head of Sipo expressed her disappointment that the organisation’s requests for additional powers were rebuffed by Government. Among the organisation’s requests were that breaking the rules should be made an offence – strangely, there is no penalty for violating the rules outlined above – and for enhanced enforcement and investigative powers.

Arguing for the new powers, Sipo’s head Sherry Perrault specifically warned about the traffic between the public and private sectors, and also suggested that the lack of powers for the watchdog to police the area meant there was likely to be many unreported breaches of the law.

Her warnings fell on deaf ears then. It might be time to listen to them now.

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