May 17, 2011 6:31 pm

Hoon job spurs call to close revolving doors

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The appointment of Geoff Hoon to work for helicopter company AgustaWestland underlines the need for reform of Britain’s “revolving doors” between Westminster and the corporate world, transparency campaigners said on Tuesday.

The case highlighted the need for a “radical overhaul” of the system, said Chandrashekhar Krishnan, director of Transparency International. Ministers should be banned for life from employment with companies they had dealt with while in office, he said.

As defence secretary, Mr Hoon approved a £1bn order for 70 Future Lynx helicopters from AgustaWestland in 2005. That provisional agreement angered rival manufacturers, which were not allowed to compete for the contract.

AgustaWestland said that the former defence secretary did not sign off “any ongoing contracts” with the company. It was Des Browne, Mr Hoon’s successor, who finally signed off the deal in June 2006.

The order had not been put out to tender because it was an “upgrade” rather than a new contract, AgustaWestland said.

Mr Hoon’s new full-time job, revealed in Tuesday’s Financial Times, will involve selling helicopters internationally, although not in Italy nor the UK.

The former defence secretary was suspended by the Labour party last year after he was recorded by undercover reporters saying he wanted to make money out of his contacts in the “international scene”.

Meanwhile, Sir Kevin Tebbit, former permanent secretary at the Ministry of Defence, is now UK chairman of Finmeccanica, the Italian company which owns AgustaWestland.

There is no suggestion of any impropriety, but the appointments highlight the way in which former ministers and officials often take up lucrative jobs in the private sector.

Rules state that former ministers and officials seeking private work within two years of leaving Whitehall must seek approval from the Advisory Committee on Business Appointments.

Typically, they are barred from any lobbying of the UK government for one or two years after their departure. The committee, comprised of peers and knights, seldom, if ever, turns down a request.

Many former Labour ministers are now working for the corporate sector, with Tony Blair hired by JPMorgan Chase, Lord Mandelson advising Lazard and Patricia Hewitt employed by Boots and Cinven.

Transparency International said weak rules governing the system put Britain at “high risk of corruption” and undermined “trust in government”.

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