A conflict of interest: the Saudi state and the UK’s Ministry of Justice

#UK & #Saudi Ministers of Justice – Rt Hon Chris Grayling & Dr al Issa – sign mou on judicial #cooperationpic.twitter.com/JXqES7D8AI

— UKinSaudiArabia (@UKinSaudiArabia) September 11, 2014

The proposed commercial deal between the Saudi Arabian state and the UK’s Ministry of Justice (MoJ) – whereby the Saudis will pay some £5.9 million for MoJ assistance for its punishment system – prompts a number of concerns.

The first concern is in respect of transparency.  The  MoJ is refusing is disclose any detailed information about the commercial proposal.  The MoJ is also refusing to disclose the accompanying Memorandum of Understanding (MoU) which was signed between Saudi Arabia and the MoJ in September last year (and the signing of which was publicised by the UK embassy in the tweet above).

The second concern regards domestic policy.  Is it appropriate, at a time of severe cuts, for the MoJ to divert scarce civil service resources from the English and Welsh offender management system to assist a punishment regime such as that of Saudi Arabia?  And, related to this, can the UK really claim to have any particular expertise in offender management, in view of the regular damning inspection reports?

The third concern is about whether the proposed assistance for the Saudi punishment system will, in fact, improve the inhumane and brutal treatment of prisoners.  For example, as Amnesty International has asked about this proposed assistance, will the MoJ be “going to be challenging and seeking to prevent abuses when it comes across malpractice, and indeed what human rights safeguards and training are going to be built into any programme”?  In other words, what positve difference will the proposed assistance make?

The fourth concern is the simple of one of legitimacy: will the proposed assistance wrongly offer legitimacy – a valuable seal of approval – to the Saudi punishment system?

The fifth concern is perhaps the most serious, from the point of view of the legal system of England and Wales.  Will the proposed commercial deal create either an actual or apparent conflict of interest for the MoJ?

This final concern is not a fanciful point.  In 2006, the Saudi state forced the UK’s serious fraud office to drop an investigation into BAe (for details, including documented evidence, see the 2008 “Corner House” decision of the House of Lords – a case which should be read by anyone interested in the influence the Saudis have over the UK state). There are many examples of those involved with the Saudi state seeking to coerce the legal process in this jurisdiction (see here and here).

As the MoJ is responsible for the integrity of the legal system of England and Wales – and the cabinet minister responsible for the department even has a legal – some would say, constitutional – duty to uphold the rule of law – is it open to the MoJ to enter into a commercial relationship with a foreign state which as Corner House and other examples show has a documented record of seeking to coerce the domestic legal process?

However, it is one thing to articulate grounds of concern; it is, of course, another to be satisfied that those grounds have any substance.

So: is this proposed deal a problem?

And what is the available information?

What follows (at length) is what appears to me to be the relevant information about, in order, the MoJ, the National Offender Management Service, “Just Solutions international” (JSi), the MoU, and the proposed commercial deal.  I will then set out the extent to which I think the concerns are made out and why, in particular, a commercial relationship between the MoJ and the Saudi regime would create an unacceptable conflict of interest for the MoJ.

The Ministry of Justice

The MoJ is a fairly new UK government department. (A note: although the MoJ has responsibilities across the UK, it is responsible for the legal system of England and Wales, and not for the separate jurisdictions of Scotland and Northern Ireland.)

In essence, the department was formed out of the old Lord Chancellor’s Department (which was responsible for the court system of England and Wales) with additional responsibilities for prisons and probation – the punishment (and rehabilitation) system.  It seemed a Good Thing at the time, and the notion of an integrated court-prison-probation system is one which many would nod-along with.

The cabinet minister for this new larger department ended up with two titles. First, the minister would be a “Secretary of State” – the usual title for a cabinet minister with departmental responsibilities.  And the minister would also hold the ancient title of “Lord Chancellor” – nominally head of the judiciary and historic supervisor of the courts.  The then Prime Minister had intended to abolish the latter title but, being constitutionally illiterate, he had not realised it would not be possible without extensive legislation.

And the two titles pointed to a tension in the department: on one hand, the minister was responsible for a spending department, with all the budget pressures that involved; and, on the other hand, the minister had a special position in respect of the integrity of the legal system.  The Lord Chancellor was there in part to defend the independence of the judiciary, and the post was usually given to a distinguished lawyer-politician at the end of their career.

When the department was created there were fears that the important role of the Lord Chancellor in respect of the rule of law would be diminished; and that is why in the very first provision of the Constitutional Reform Act 2005 was set out that the duty of the Lord Chancellor in respect of defending the integrity of the legal system would be unaffected:

1.  The rule of law

This Act does not adversely affect—

(a) the existing constitutional principle of the rule of law, or

(b) the Lord Chancellor’s existing constitutional role in relation to that principle.

This is a carefully worded provision. It does not create some statutory duty for the Lord Chancellor to uphold the rule of law.  It instead recognises a pre-existing duty.

Part of this new Ministry of Justice was re-titled the National Offender Management Service (NOMS).  In its own words:

We are accountable for how prisons are run in England and Wales. Through HM Prison Service we manage public sector prisons in England and Wales.

We also oversee probation delivery in England and Wales through the National Probation Service and community rehabilitation companies.

However, NOMS does not have any separate legal existence apart from the MoJ.  Its designation as an “executive agency” has administrative but not legal meaning. It is part of the MoJ, and its staff are civil servants and its resources are those of the civil service, funded by the taxpayer.

Just Solutions international

Just Solutions international (JSi) – complete with a gimmicky lower-case “i” for international – is something very few had heard of until the proposed MoJ deal with the Saudis came to attention.

JSi has its own “.com” website.  It is worth taking time to look around it.  There is even a glossy brochure.

On its “about us” page, you are told:

JSi provides a range of solutions across the Justice system, from policing through courts to prisons and community sentence delivery. A particular focus is on reducing re-offending and recidivism.

JSi has been created as a social enterprise by a team of entrepreneurs within the UK Justice system.

We deliver our services to customers in conjunction with NOMS.

This is at best misleading: JSi is not “in conjunction” with NOMS.  It is part of NOMS.  And its personnel are better described as civil servants within the MoJ than “a team of entrepreneurs within the UK Justice system” (whatever that could mean).

JSi is a label for NOMS, which in turn is a label within MoJ.  As I have already set out at the FT, JSi is not even a trading fund under the relevant legislation, and the MoJ has had to admit to parliament that JSi does not even keep separate profit and loss accounts.

JSi seeks to give the impression with its .com website (instead of the more appropriate .gov.uk sites for central government work) and heady talk of entrepreneurship, being a “trading arm” and representing NOMS “on all commercial issues” that it is something other than just civil servants within the MoJ with no greater legal power to sell civil service assets than any other civil servants.

In essence, an ambitious group of civil servants have given themselves a gimmicky name and set up their own .com website with the intention of selling their department’s assets somehow in “conjunction” with, well, themselves.

There is very little official information about JSi other than on their website.  On 9 October 2013, the Lord Chancellor and Secretary of State referred to the group in a speech to the World Probation Congress, where he said:

In response to this interest from around the world, we are setting up Just
Solutions International – a social enterprise – to enable this service to be
delivered in a commercial manner.

It will be able to make available knowledge and expertise relating to
offender management services to organisations in other countries that
work with offenders.

The new body is currently being piloted and we are looking to launch it in
April 2014. Our intention is that Just Solutions will be able to provide you
with access to all the services you will hear about during this conference,
including, to name but a few:
– development and improvement of probation services;
– prison estates, prison design, prison building and procurement;
– cutting-edge electronic monitoring systems; and
– payment-by-results and reducing re-offending mechanisms.

This, however, was not the first public mention of JSi.  For some reason, three months before the Lord Chancellor and Secretary of State’s announcement of its launch, the commercial opportunities for JSi is discussed on the PricewaterhouseCoopers blog.  Here, we told:

[NOMS] is exploring an option to establish a not-for-profit organisation to market its expertise in Justice internationally. The new operation, Just Solutions International (JSi), will re-invest any surplus into research that supports the work of NOMS.

Because spending cuts have diminished the budget available for this research, JSi is an example not only of government earning income on its IP, but also of it using that income to maintain a high standard of service delivery.

How PricewaterhouseCoopers (complete with gimmicky lower-case “w”) knew so much about JSi three months before the Lord Chancellor and Secretary of State’s announcement is anyone’s guess.

Curiously, the glossy JSi brochure also happens to use exactly the same distinctive “legal disclaimer” language as the glossy brochures of PricewaterhouseCoopers.

Is PricewaterhouseCoopers involved with JSi?  I put this to PricewaterhouseCoopers and they refused to comment citing “client confidentiality” (which at least perhaps suggests my request related to a client matter). Why “client confidentiality” would stop PricewaterhouseCoopers commenting now when they were happy to discuss the commercial opportunities on its own blog in 2013 is unknown. I do hope that blogpost was not a breach of client confidentiality and that it was signed-off by the MoJ.

For its part, MoJ denied that there are “currently” any private sector organisations/consultancies involved in the JSi project.

Other than the PricewaterhouseCoopers blogpost and Grayling’s announcement (both of 2013) there is then little public trace of JSi before the proposed Saudi deal.  I asked the MoJ what official documents have mentioned JSi before the proposed Saudi deal emerged.  Initially the MoJ refused to answer this question (along with many others).

I was then told JSi is referred to (though not named) in the UKTI Security Exports Strategy of 2014.  And indeed it is: page 25 of the document shows that the UK government intends to tout “offender management services” around the globe as a “security export”.

It is a remarkable read: the selling of offender management and other-prison-related services is set firmly in the context of national security and intelligence.  Selling such services is not thereby a MoJ frolic; it is part of a wider and coordinated government policy.

The MoU

On 11 September 2014, the Lord Chancellor and Secretary of State signed a MoU with his Saudi counterpart.  A photograph of the signing ceremony is in the tweet at the head of this post.  The tweet was posted by the UK embassy in Saudi Arabia.

The MoU regards judicial co-operation: in other words, how the respective legal systems of the UK (or just of England and Wales) and Saudi Arabia will work together.

In December 2014, in a report to Parliament, the MoJ said:

The Secretary of State visited Riyadh in September 2014 to sign a Memorandum of Understanding on Judicial Cooperation, to build upon the existing bilateral justice relationship, promote UK legal services in Saudi Arabia and raise awareness of the upcoming Global Law Summit. He also met UK lawyers with offices in Riyadh. Discussions were also held on judicial cooperation, King Abdullah’s reform programme, and human rights issues.

I have already noted elsewhere that noted that judicial cooperation between Saudi Arabia and the UK already seemed quite good before the MoU, as the 2013 transfer of Prince Saud bin Abdulaziz bin Nasir Al Saud indicated.

So what does this MoU say?

We don’t know.

One would think that it would be a public document.  It was announced publicly by the UK embassy who even published a photograph of it being signed; and it was reported to Parliament with a description of how it will build on (and so make a difference to) the existing relationship.  And it would, presumably, contain information about how the two legal systems will interact in way different to how they have interacted before, and this could be crucially important to affected individuals and companies.  It is the very sort of document which should be in the public domain.

The MoJ are refusing to publish the MoU.  I asked the MoJ directly for a copy, and the response was:

This is a shared document with the Saudi government so we are not in a position to publish it at present.  

This is a non-sequitur.  Of course it is a “shared” document: it is a memorandum of understanding signed by two parties – it is “shared” is in its very nature.  And the the fact it is a shared document – which will affect third parties with dealings with both legal systems – is why it should be in the public domain.

(I have put in a Freedom of Information request for the MoU.)

Judicial cooperation is something – like improving prisons – which is (usually) a Good Thing and one can nod-along with.  But given the Corner House case and other examples of where the Saudis have sought to exert illegitimate pressure on the UK legal system, the actual terms of any judicial cooperation between the UK and the Saudi state are clearly a matter for public concern.

The commercial proposal

In the same report to Parliament as the mention of the MoU is another passage describing the proposed commercial deal.

In a paragraph alongside one  saying how the UK will host a “Global Law Summit, a world-class international event to coincide with the 800th anniversary of Magna Carta” to “showcase the depth and adaptability of the UK legal system and will demonstrate the foundation that our rule of law has created for businesses to flourish”was this information:

Just Solutions international (JSi), is the commercial brand for the National Offender Management Service (NOMS) promoting products and services to international justice markets.

In August 2014, JSi submitted a £5.9m proposal to the Kingdom of Saudi
Arabia, Ministry of Finance to conduct a training needs analysis across all the learning and development programmes within the Saudi Arabian Prison Service.

(This passage was first reported by David Hencke.  There is also mention of a proposed bid to another illiberal regime, Oman.)

There are a few things to note about the described proposal.

First, look at the dates: the commercial bid was made in August 2014, two months before the MoU was signed.  This means that the MoJ was simultaneously bidding for commercial work with the Saudi regime at the time it was finalising and entering into the MoU on judicial cooperation. (And remember neither NOMS nor JSi has any legal existence distinct from the MoJ –  they are simply labels.)

Second, the flow of cash will be from Saudi Arabia to the MoJ.  Most UK government contracts, of course, work the other way round – the government (though a complex legal process called “public procurement” usually buys in goods and services, rather than selling them to others.

Third, the amount of cash is £5.9 million.  This is nothing, of course, to the Saudis; but it is a significant amount to a department like the MoJ in a period of substantial cuts and strain on the legal aid system.  The money will be paid directly to MoJ and will not be accounted for separately.  In other words: things will depend on this much-needed money being paid. As the MoJ explained to me:

Any commercial work undertaken by NOMS falls within the overall NOMS budget. The aim is that it covers the costs of NOMS commercial and other international work and generates a surplus to invest in our own services.

If approved the bid will be fully funded by the client [ie, Saudi Arabia] Government, will not cost the British tax payer a single penny and will generate a surplus to be used to support our own services.

But fourth, the proposal is for “ a training needs analysis across all the learning and development programmes within the Saudi Arabian Prison Service” which is surely a Good Thing, which we can all nod-along with.  Why such an anaysis is worth £5.9 million, and why the civil servants diverted from their work in UK will be in any good position to conduct such an analysis of what is a significantly different punishment system, are questions which are not answered.

But there other concerns, raised by Amnesty International (quoted here):

Given the prevalence of torture in detention, given that prisoners may – like Raif Badawi – face a flogging, and given that dozens of prisoners each year are taken out of their cells and publicly beheaded, we need to know how this scheme is going to help improve the situation?

Beyond the usual aspirational language, can Chris Grayling demonstrate that Just Solutions international will actually be able to concretely improve detention practices in Saudi Arabia without becoming complicit in abuse?

For example, is JSi going to be challenging and seeking to prevent abuses when it comes across malpractice, and indeed what human rights safeguards and training are going to be built into any programme?

These are serious points.

After David Hencke’s report and my initial FT piece, the Lord Chancellor and Secretary of State was asked about the proposed deal on television and he said he was looking at the deal “carefully”.  This, of course, a deal which he put before Parliament in his department’s report in December 2014.

I posed thirteen questions for information and documents, all of which were refused with a blanket statement.  I was even told dismissively that the MoJ would “not provide a running commentary” – even though the requests for precise information and documents and not for “commentary” at all.

However, tenacity and escalation sometimes pays off, and late on Friday I was provided with further information.

Question: When is the proposal expected to be signed?

Our bid is under consideration and may not be successful. We do not know the timing of bid evaluation and decision making – this depends on the pace of the Saudi Procurement process.

Question: What was the answer to Amnesty’s questions? (Quoted above.)

We believe that by bringing our standards on issues such as human rights into international delivery we will improve detention practices.

We should recognise that our correctional services are well viewed by other Governments who also understand our approach to human rights.

When other countries approach us for assistance therefore they do so in full knowledge that we will only offer advice and support that complies with our own human rights standards.

We have already seen and challenged practice in other countries and have been instrumental in the change of practice in other countries.

Question: Why has the Secretary of State now said he is looking at the Saudi proposal carefully? What does this mean in practice?

All international activity considered by NOMS is subject to a careful assessment process and sign off by MoJ; FCO and our local Embassies.

This includes an assessment about whether our possible activity would improve human rights outcomes.

This process was completed prior to our bid to Saudi.

And interestingly, the MoJ added:

We would expect to repeat this process if the Saudi Government decided to offer NOMS the contract. In that case the Secretary of State would have the opportunity to review the earlier decision in the light of current issues and considerations.

The final decision may be to continue to contract (should it be offered) or to withdraw from the process.

So it is not a done deal; and the Lord Chancellor and Secretary of State will consider “human rights outcomes” before signing any contract.

There was, of course, no good reason why any of this information could not have been provided to begin with.

I also asked the MoJ about the conflict of interest – the “Corner House” question. Was it open to the Lord Chancellor and Secretary of State to enter into a commercial relationship with a Saudi state which uses threats and coercion to disrupt and corrupt the domestic legal system?  How could the Lord Chancellor and Secretary of State be able to stand up to its new “client” if the Saudi state again issues threats which would affect the rule of law?

The response on that point:

A MoJ spokesperson said:
“The British Government’s position on human rights is a matter of public record and we regularly raise our human rights concerns with the Saudi Arabian authorities at the highest level.

“No aspect of our commercial relationships prevents us from speaking frankly and openly to them about these or other issues.”

So that’s alright then: a high-value commercial deal by which the MoJ will receive £5.9 million which will be used to fund other services, contained in a commercial proposal which it will not disclose but was made at the same time as the MoJ negotiated a MoU on judicial cooperation will not have any impact at all on the MoJ “speaking frankly and openly” to its “client”.

Conclusion: a conflict of interest

So, are any of the concerns articulated at the head of the post made out?

In respect of transparency, the simultaneous MoU and commercial bid are not in the public domain, and both of them should be, even if there was no question of a connection between the two.  Both are documents which, on their own terms, should be published in the public interest.

In respect of domestic policy, your view on whether this is a a good way of scarce MoJ resources to be used – especially in a period of substantial cuts – will ultimately be a value judgment.  And most people who follow the operation of the prison and probation services will legitimately wonder if the UK is in any position to market expertise abroad.

In respect of whether the proposal will improve the lot of those in the Saudi punishment system, your view will partly depend on whether you are satisfied by the the MoJ’s (eventual) responses to the questions posed by Amnesty International. And even if the assistance is a Good Thing, there is no reason why it should be offered by the UK on a “commercial” basis.

In respect of whether the proposal will give wrongful legitimacy to the barbaric Saudi punishment system will also ultimately be a value judgment.

However, in respect of the the concern as to whether the proposal creates a conflict of interest, the position is clear.

The MoJ, responsible for the legal system of England and Wales, is seeking a commercial relationship, by which it intends to make a surplus to be used for other services, with a foreign state which as the Corner House case alone documents coerces the legal system of England and Wales by illegitimate means at its disposal.

In these circumstances, it cannot be open to the Lord Chancellor and Secretary of State to enter into a commercial arrangement with the Saudi state.

Even if there was transparency, and even if this was (somehow) a good use of civil service resources which would benefit the lot of those in the Saudi punishment system, and even if there could be no doubt that MoJ will stand up to the Saudis when abuses occur – in other words, even if there was nothing else concerning about this proposed deal at all, it still should not go ahead because of the conflict of interest the deal will create.

The Lord Chancellor and Secretary of State for Justice cannot combine the duty to uphold the rule of law and protect the integrity of the domestic legal system at the same time as entering into a commercial deal with the Saudi state described in the Corner House case (and other cases).

In summary: whatever else is wrong about this deal, the Lord Chancellor and Secretary of State for Justice should not enter into a high-value and beneficial commercial relationship with a Saudi state which is well documented as using illegitimate force to disrupt the legal system of the UK.

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