• Only 40% of surveyed bodies require all staff to annually declare interests, compared with 91% for senior staff.
  • 83% feel the system for managing conflicts can be improved, with many public bodies lacking central registers, proper records, data on compliance, and checks that mitigations work.
  • NAO recommends mandatory annual declaration from all employees – see NAO good practice guide for further recommendations.1 

Gaps in how public bodies manage conflicts of interest among staff pose a risk to government’s ability to perform its functions objectively, according to a new National Audit Office (NAO) report.2,3,4

The Cabinet Office is responsible for establishing central government guidance on managing conflicts of interest.5 Following concerns about propriety in government during the Covid-19 pandemic, it published new advice in June 2022, which applies to all departments and their executive agencies.6

As well as supporting new ministers in completing and returning their declaration forms (which are reviewed independently7) through its Propriety and Ethics Team, the Cabinet Office sets separate rules for special advisers, non-executive directors and senior civil servants that cover conflicts relating to personal, financial and familial interests. Members of Parliament and members of the House of Lords answer to the Houses of Parliament’s own requirements.8

Since the publication of the 2022 guidance, 71% of the public bodies surveyed for the report stated that they had improved their systems for managing conflicts. As a result, 91% now require senior staff to annually declare conflicts as per Cabinet Office guidance.9,10

However, only 40% of surveyed bodies require annual declarations across all their workforce. The lack of specific guidance on the systems and controls that public bodies need to set up, coupled with multiple definitions of what constitutes a ‘conflict of interest’, has led to disparate approaches.

In most organisations, the requirement for staff to declare their interests is undermined by a lack of data on rates of compliance. The survey showed that 71% lacked management information on compliance, while of the five bodies that required all staff to complete a declaration and who were able to share management information, only one could demonstrate 100% compliance.

Other areas needing attention identified in the NAO report include a lack of training to help staff declare and manage conflicts of interest; complicated e-registers discouraging compliance; and a widespread failure to follow good practice.

Many public bodies are aware of these weaknesses in their corporate systems and are endeavouring to meet propriety standards. There are also lessons to be learned from the more robust processes that procurement teams have in place11 and from other professions where staff are expected to behave in line with a set of common standards, including doctors, accountants and finance professionals. A companion good practice guide published alongside the NAO report details how government can ensure that public bodies put in place the necessary governance, systems and processes to facilitate the effective management of conflicts of interest from all staff.

“Despite improvements in its systems for managing conflicts of interest, government has more to do to ensure full coverage of the civil service and other public officials and consistent implementation of the required controls.”

Gareth Davies, head of the NAO

Read the full report

Managing conflicts of interest: value for money

Notes for editors

  1. Link to good practice guide: https://www.nao.org.uk/insights/managing-conflicts-of-interest-gpg/
  2. Link to report: https://www.nao.org.uk/reports/managing-conflicts-of-interest/
  3. The report looks at the governance, systems and processes that public bodies have used to manage conflicts of interest.
  4. Conflicts of interest arise when an individual’s ability to apply judgement or act in a role is, or could appear to be, impaired or influenced by a secondary interest. For a glossary of relevant terms used by different public bodies, see page 4 of the report.
  5. Departmental bodies (ministerial departments, non-ministerial departments and executive agencies) must have policies that comply with this guidance. Non-departmental public bodies are encouraged to have their own policies.
  6. Declaration and management of outside interests in the Civil Service – GOV.UK
  7. Ministers’ interests are reviewed and published by the Independent Adviser on Ministerial Standards.
  8. The report does not review the application of the Ministerial Code, except to define what it is and how it overlaps with the Accounting Officer’s responsibilities as set out in the Managing Public Money guidance. Parliamentarians follow a separate declaration and publication regime, which is not in the scope of the report.
  9. ‘Senior staff’ is defined as senior civil servants or their equivalent in non-departmental public bodies.
  10. The report consulted with six public bodies on how they manage conflicts in practice and supplemented this with a survey of 35 public bodies.
  11. Formalised and strengthened by the Procurement Act 2023.

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