The Cabinet Office plan to issue a warning to civil servants was confirmed in a note sent by Lord True, a Cabinet Office minister, to Lord Pickles, whose advisory committee on business appointments (Acoba) monitors jobs taken up by ministers and officials leaving government.

“We will take steps to highlight to departments that in their communications they should be conscious of the restrictions on direct engagement with those subject to business appointment conditions,” Lord True wrote.

The minister’s letter confirmed that the Government agreed with Lord Pickles, who both believe that Lord Hammond had breached the “letter and spirit of the rules” governing ministers’ post-Whitehall roles when he contacted Charles Roxburgh, the Treasury’s second most senior civil servant, last year on behalf of OakNorth.

The approach was first revealed by The Telegraph in August. In an email to Mr Roxburgh on Friday July 24, 2020, the former chancellor said the bank wanted to offer the Government the use of a “toolkit” it had developed to assess potential borrowers.  

Lord Hammond insisted no rules were broken because OakNorth was offering a product “free of charge”. However, The Telegraph understands that Treasury officials do not recall OakNorth making clear that the product would be either free or subject to a charge.

While there was no suggestion of wrongdoing by Mr Roxburgh, the decision to write to officials about their response to such contact suggests civil servants may be expected to rebuff similar approaches in future.

Toothlessness of current system highlighted

The case highlighted the toothlessness of the current system for policing the work carried out by ministers after they leave office. The system relies on Acoba providing advice to those departing government, without any sanctions available to be used against those who flout the rules.  

Angela Rayner, the shadow chancellor of the Duchy of Lancaster, has said Labour would tighten up the rules to “close the revolving door”, including extending  a the current two-year lobbying ban for ex-ministers to five years and introducing a new independent Integrity and Ethics Commission.

The Cabinet Office is working up proposals for a series of “improvements” to the system governing the activities of ex-ministers and civil servants.  

The Government has said “the scope and length of restrictions on employment for former civil servants and ministers need to be balanced alongside the rights to freedom of association and the right to work.”

No action has been taken against Mr Hammond.