We call on the Government to address this point of principle: that it is unacceptable and incompatible with genuine independence for the ethical regulators, which were created to regulate government, to be appointed by government and funded by government. We therefore urge the Government to adopt a coherent and principle-based approach to ethical regulation that is designed to secure the independence of ethical regulators from the Executive. (Paragraph 6)

Thank you for the Public Administration Select Committee's Further Report on Ethics and Standards, published in response to my letter to you of 25 November. I would like to respond to the issues raised in the Further Report.

The Government is also committed to a system of ethical regulation which operates independently of Government. The Government is therefore pleased to see that the Committee believes all of the ethical regulators have demonstrated their ability to act robustly and autonomously. The Government is therefore not persuaded that the imposition of a uniform structure and status for all of the ethical regulators is either necessary or desirable, particularly as the Committee's recommendation involves creating a whole new body in the form of a Public Standards Commission. We do not see how such a body would add value to the work of the ethical regulators.

In its further report, the Committee argues that, without the ethical regulators having a basis in statute, the Government could reduce their funding or abolish them if it wished to do so. The Government does not accept that this is a realistic possibility. Parliament already takes a close interest in the operation of regulators, not least through the Public Administration Select Committee itself. The regulators are able to bring to the attention of Parliament any concerns they might have about funding or any other issue relevant to their operation. In addition, the independence of the regulators in practice will be further strengthened by the introduction of single non-renewable terms for appointees to the regulators.

As the Committee said in its recommendation on this issue, "The reform of ethical regulation is likely to be a gradual process, which will allow examination and review of new arrangements". The Government agrees with this approach and is committed to finding the right arrangements for each individual circumstance. As ethical regulation evolves, it may be appropriate for a particular regulator to be placed on a statutory footing, as the Government is committed to doing in relation to the Civil Service Commissioners.

In the case of the Civil Service Commissioners, this is the right thing to do in the particular circumstances. The Government wants to formalise the constitutional status of our impartial Civil Service by enshrining its position in statue. It is therefore entirely consistent and logical to place the Civil Service Commissioners on a statutory footing also.

However, we do not see this changing the way the Commissioners operate. The Commissioners already operate independently of Government and will continue to do so.

There is nothing to suggest that any of the ethical regulators are currently inhibited from operating independently of Government. The Government stands by its assertion that their independence is not in question. As you yourself said during the debate in the House on 5 December 2007, "the time has come to recognise explicitly that we have created a system of permanent ethical regulation… In fact, such bodies are not compromised in practice; they do excellent work and are robustly independent". Given acceptance of the ethical regulators as a permanent part of our political landscape and the recognition that they operate in a robustly independent way, the Government thinks it advantageous to retain the flexibility to respond appropriately and quickly to the particular circumstances faced by each of the regulators.

The contribution of PASC has been enormously helpful in the evolution of our system for ethical regulation and I hope we can continue to work together on these issues.