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Guidance on gifts and hospitality for Board members

Summary

Agency board report number: SEPA 53/23 - November 2023

This guidance is provided for Agency Board members. It is new guidance based on the Standards Commission for Scotland Advice Note on Gifts and Hospitality and should be read in conjunction with the Board Code of Conduct.

All Board members have a personal responsibility to comply with the Code. The guidance will form part of the Induction Pack for new Board members in January 2024 and be reviewed as part of the annual review of the Board’s official documents and procedures each February.

The Board is asked to approve the guidance.

Introduction

This guidance is provided for Agency Board members. It is based on the Standards Commission for Scotland Advice Note on Gifts and Hospitality which contains illustrative examples.

This guidance should be read in conjunction with the Board Code of Conduct - Model Code of Conduct for Members of Devolved Public Bodies.

General principles

The provisions in the Code on gifts and hospitality are designed to avoid any perception that members may be using their role to obtain access to benefits that members of the public would otherwise be expected to pay for, and also to prevent them from being influenced (inadvertently or otherwise) into making decisions for reasons other than the public interest. Any perception, whether justified or otherwise, that members are making decisions for their own personal interests or for those of their friends or family erodes public trust both in their role and SEPA itself.

The Code (paragraph 3.14) prohibits you from seeking, or asking for, a gift or hospitality, in your role as a member. This is regardless of the circumstances or value of the gift or hospitality. The Code recognises, however, that you may be offered a gift or hospitality. It seeks to outline the limited circumstances in which such an offer can be accepted.

The Code (paragraph 3.13) makes it clear that the test is not whether the acceptance of any gift or hospitality could or would affect your decision-making as a member. Instead, the test for the acceptance of gifts or hospitality is an objective one. As a member, you should consider whether your acceptance of any gift or hospitality would lead an informed member of the public (i.e. someone who knows you are a member, the nature of the gift or hospitality, and who has offered it) to reasonably think it could influence your judgement, discussions or decision-making as a board member. As in all such considerations, you should think not just of your own perception as to whether it could do so, but the perception of others. You should always consider whether you would have been offered the gift or hospitality if you were not a member.

It should be noted that ‘gifts’ and ‘hospitality’ can come in many forms. Beyond the more obvious things like bottles of wine or offers of lunch, they can include:

• the provision of services at a price below that generally charged to the public;
• the provision of a meal or drinks at a price below that generally charged to the public;
• incurring personal debts or obligations on someone’s behalf;
• relief from indebtedness;
• loan concessions; and / or
• other financial inducements.

The Code (paragraph 3.18) provides that you must NOT accept any gift or hospitality from any individual or organisation who is awaiting a decision from, or seeking to do business with, your public body (for example, from an applicant for grant funding or from a company tendering for a contract). Again, this applies regardless of how small in nature or value the offered gift or hospitality may be. The ban on accepting a gift or hospitality from any individual or organisation who is awaiting a decision from, or seeking to do business with, your public body under paragraph 3.18 is absolute, meaning it is not qualified by any objective test.

The prohibition under paragraph 3.18 on you accepting a gift or hospitality from someone who is awaiting a decision from, or seeking to do business with, your public body applies irrespective of whether you sit on a committee or panel with an influence on the outcome of such matters. This is because there could be a perception that you could still be in a position to influence colleagues into making the decision one way or another.

As you have a personal responsibility to comply with the Code, the onus is on you to ascertain whether the individual or organisation offering you gifts and / or hospitality is awaiting a decision from, or seeking to do business with, your public body. If you are in any doubt, you should check with SEPA. You should not accept the gift or hospitality until you have confirmed the position.

The Code makes it clear that the default position is you should refuse all offers of gifts and hospitality, except in the very limited circumstances listed at paragraph 3.15 of the Code. It should be noted that acceptance can include accepting the promise of a gift or hospitality (even if that gift or hospitality is not then provided) - Essentially, unless the gift or hospitality falls within one of the categories listed under paragraph 3.15, it should not be accepted.

As a general rule, you should not accept gifts and hospitality that members of the public would otherwise have to pay for.

Categories of gifts and hospitality that can be accepted, in terms of paragraph 3.15

A minor item or token of modest intrinsic value

The Code provides (paragraph 3.15(a)) that you can accept minor gifts and hospitality of a modest intrinsic value. These would be items such as a pen or a notepad, or hospitality that a member would normally be expected to be offered in their everyday role – such as tea or coffee at a local event, or a sandwich or buffet lunch included as part of a daily rate charged and provided to all delegates at a training event or conference.

It is important to note that, unlike in previous versions of the Code, there is no financial limit of £50 in respect of gifts under the current version of the Code. Even gifts with a small monetary value, or limited hospitality, can create the impression that members are being influenced, and that there is a culture of ‘favouritism’ or ‘cronyism’ within public bodies. Such allegations are much easier to refute if no gifts or hospitality have been accepted.

It should also be noted that gifts and hospitality under this category can only be accepted if they are ones that are offered on an infrequent basis. While infrequent is not defined (as this would depend on the specific circumstances of each case), it is unlikely that weekly, or even monthly, offers of gifts and hospitality from the same source would fall within this category.

A gift being offered to my public body

The Code recognises (paragraph 3.15(b)) that there may be situations where, particularly if you are the Chair or Deputy Chair, you will be expected to accept gifts on your public body’s behalf. Similarly, paragraph 3.19 of the Code recognises that there could be situations where refusing to accept a gift might cause embarrassment or offence. If you consider that may be the case, you can accept the gift on behalf of SEPA. You should then pass the gift to the SEPA’s Standards Officer at the earliest opportunity.

Hospitality which would reasonably be associated with my duties as a board member

The Code (paragraph 3.15(c)) covers hospitality which would reasonably be associated with your duties as a member. Examples of this could be:

• tea or coffee at a local event for stakeholders;
• a sandwich or buffet lunch included as part of a daily rate charged and provided to all delegates at a training event or conference; or
• an invitation to a drink reception at the Scottish Parliament that was extended to all members of SEPA.

Hospitality which has been approved in advance by my public body

The Code covers hospitality which has been approved in advance by your public body (paragraph 3.15(d)). You should check your public body’s internal rules and policies on this, and, if in doubt, seek advice from SEPA’s Standards Officer.

If you wish to accept any offer of hospitality that falls outwith that which can be accepted under paragraph 3.15(c) you should, in the first instance, confirm that it is not being offered by any individual or organisation who is awaiting a decision from, or seeking to do business with, SEPA. You must then seek approval, from SEPA’s Chief Executive or Standards Officer. In seeking approval, you should clearly state the name of the individual or organisation who has offered the hospitality and what it will entail (including the date and venue). You should always try to seek approval in writing.

Bribery

The Code (paragraph 3.17) provides that you must not allow the promise of money or other financial advantage (including any form of gift or hospitality) to induce you to act improperly (i.e. in a way that is dishonest or is against the law, a rule, the Code or a policy) in your role as a member. You should note that this includes any money or advantage (including any gift or hospitality) given to you both directly and indirectly (i.e. via a friend, family member or associate or to a club or group you are a member of). The offer of monies or advantages to others may amount to bribery if the intention is to induce you to improperly perform a function.

The Standards Commission’s Guidance on the Code makes the point that, aside from considerations of whether you have breached the Code or not, offers of such inducements can be a criminal offence (the Bribery Act 2010) for the person making the offer, the recipient, and the person being induced to act differently as a result of the offer.

Regardless of any of the provisions in the Code, a gift to someone else which induces you to improperly undertake a statutory duty, is still likely to fall foul of the provisions of the Bribery Act. This could result in a criminal prosecution against you.

If you are in any doubt about whether an offer either you, or another person has received might fall foul of the Bribery Act, you should seek legal advice immediately.

Decision making

The Code provides (paragraph 3.18) that you must never accept any gift or hospitality from any individual or organisation who is awaiting a decision from, or is seeking to do business with, SEPA.

Where anyone is awaiting a decision from, or seeking to do business with, your public body, you should not accept any form of gift or hospitality from them, no matter how small in nature or value. This is irrespective of whether you are on a committee or panel that is responsible for making the decision, as there could still be a perception that you might be in a position to influence colleagues making the decision one way or another. This is particularly the case if anyone offering a gift or hospitality has an outstanding quasi-judicial or regulatory application that is due to be considered by the public body.

You should never accept any offer of a gift or hospitality if you are in any doubt as to whether the individual or organisation making the offer is awaiting a decision from, or seeking to do business with, SEPA.

In addition, the receipt of gifts and hospitality, where there is a specific objective that may be behind it, risks straying into the scope of the Bribery Act, as noted above. It may also lead to the decision itself being struck down subsequently.

Advising employees

Paragraph 3.20 of the Code provides that you should advise your public body’s Standards Officer promptly if you are offered (but refuse) any gift or hospitality of any significant value and / or if you are offered any gift or hospitality from the same source on a repeated basis.

The requirement for members to advise SEPA’s Standards Officer of any offers of any gifts or hospitality from the same source on a repeated basis is intended to ensure the public body can take action if it appears the same individual or organisation is attempting to influence its members and decision-making.

Public body employees may be better placed than an individual member to detect patterns of behaviour by organisations who are trying to influence the public body. Similarly, if employees are made aware of persistent attempts to offer hospitality to members, they are better placed to contact the organisation, point out the difficulties they are causing, and persuade them to desist.

Registration; Transitional arrangements

The Code provides, at paragraph 4.21 that:

• 4.21 I understand the requirements of paragraphs 3.13 to 3.21 regarding gifts and hospitality. As I will not accept any gifts or hospitality, other than under the limited circumstances allowed, I understand there is no longer the need to register any.

As outlined above, the default position now is you should refuse to accept any gifts and hospitality, except in very limited circumstances. However, if you have accepted gifts and hospitality under previous versions of the Code (which allowed you to accept them), any entries to that effect should remain on your Register of Interests for the term of office.

Further sources of information

If you have any queries or concerns about this Advice Note or how to interpret or act in accordance with the provisions in the Code, you should seek assistance from SEPA’s Standards Officer.

Approved by the Agency Board