Separation between private and public sectors needed

It was more than ten years ago now but feels eerily familiar today. 

The world was again on the precipice of economic disaster due to the Global Financial Crisis and uncertain recovery. 

And we were again discussing the corrosive ease with which people moved from Government agencies meant to regulate the private sector and the very same agencies they meant to regulate.

The financial crisis, we recall, had its many complicated causes. Interrelated deals between Wall Street hedge funds and Danish Governments, but, if you boiled it down it was more or less a failure of regulation. 

In a pattern that has been mimicked in other highly profitable but regulated industries world over, it soon became apparent that the companies being subject to regulation could afford to pay salaries much higher than the regulators themselves.

Companies seeking to do the most to juice their bottom lines while navigating their way through a thicket of financial regulations found they could simply hire the public servants who wrote those very laws as advisors.

What began in the 1980s as an innovative hiring strategy soon became almost the expected thing for people in public life to do once they had finished their time in the private sector.

Either M.P.s who had lost elections, or public servants whose careers were now over were expected to “cross the street” to the private sector.

They would line their pockets as lobbyists, consultants and lawyers and their new employers could share in the benefits and contacts they had gleaned throughout their years of public service.

The promise of a future job at a company might also be said to alter the decisions made by a civil servant while they were in office.

Something about this practice is ethically wrong. Information belonging to the public which civil servants become privy too should not suddenly become the property of a company working in that field the day they sign their contracts. Contacts and friendships built up over a lifetime of work in the public service naturally give people access to the Government that others do not have. For this to be used in the service of a private interest is also unfair. 

The problem of the so-called “revolving door” between the public and private sector is hardly new.

There have been some egregious examples around the world. And it’s largely up to us how we tackle the problem as regulators.

In the United States, the problem has more or less run unchecked.

Paul Manafort, Roger Stone and Charles Black were each senior members of the 1984 campaign to elect Ronald Reagan.

The day after the President won office they established Black, Manafort and Stone, one of the most successful and notorious lobbying companies to ever exist and which could promise foreign dictators and other interests unparalleled access to Government. 

The trio briefly reverted from political advisers to lobbyists in what were incredibly lucrative careers, prison sentences of which are hanging over two of which.

But despite the pungency of that example and others, few restrictions have been passed on lobbying in the United States. 

The approach in most other countries has been ad hoc and deals mostly only with those at the top 

In Japan, officials are barred for a period of two years for taking up a job with a company they had dealings with while in Government office.

Australia has a mandatory 18 month “cooling off” period during which ex Ministers are forbidden from working on matters of which they had knowledge in office. A proposal to expand this to a greater range of senior officials is under consideration.

It is about time that we give consideration to imposing limits on moving between Ministries and companies to prevent our public sector being used for financial gain.

A powerful example brought the issue to the front of debate this week when the recently-resigned Regulator, Leafaoali’i Unutoa Auelua-Fonoti, began working in the very sector it was her job to regulate.

Lefao is now working for Samoa Digital Communications Limited.

There is no suggestion of impropriety on either party’s part and the company’s Auomanū Andrew Ah Liki Jr has stressed that the former Regulator will be working for the company’s Internet Service Provider branch.

But we do not have to stretch our memories to recall that it was Lefao herself who handed over the documents to Samoa Digital Communication Limited licensing them to oversee the massive undertaking of the country’s switch away from analogue television.

As with all things in public life, it is the perception of propriety as much as the reality of a situation that counts.

And it should not be forgotten that as a means of broadcast communication, overseeing the internet’s regulation was itself part of Lefao’s duties.

We understand that people in public life have to make a living. And for those who have chosen highly specialised careers, especially those that have come to untimely ends, career options can be few. And again, we make no suggestion about either Lefao or the nature of the consulting contract.

But its case could not provide a more apt reminder that it is time that Samoa confronted the morally difficult choice of what kind of wall it wants to build between the public and private sectors.

One like the United States in which the gap between the two is so porous as to be non-existent and threatens to have a corrosive effect on the institutions on either side. We believe we can do better. 

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