Monday, February 21, 2022

Concern over ‘revolving door’ officials

 Many former Israeli Public Servants enjoy lucrative second careers in the private sector, new research has revealed.

Data collected by the Bank of Israel shows that more than half of the nation’s publicly-traded companies employ former officials, including regulators who once oversaw the same companies they have now joined.

The report’s author, Noam Michelson said the “revolving door” trend, in which Public Servants transitioned to work in the private sector, represented a challenge for democracies and developed economies.

“There is a need to strike a balance between conflicting needs: Public interest versus employees’ rights,” Mr Michelson said.

“On one hand, such transitions, if not properly regulated, can lead to abuse. They may give an unfair advantage to companies that employ former Public Servants who could use their knowledge and connections to influence future regulation.”

He said in addition, the lure of the private sector could influence the decisions of current regulators who might try to avoid harming their chances of future employment.

“On the other hand, Governments need to be able to attract top talent to the Public Service, part of which requires that they refrain from curbing workers’ employment options once they leave,” Mr Michelson said.

“At the heart of the debate… lies the question of the balance between public trust, market freedom and efficiency, and the individual’s freedom to engage in any occupation.”

He said a society could shore up trust in the public sector by banning all transitions of former Public Servants to private-sector jobs.

“However, that would impose a heavy cost in terms of limitations on market freedom and efficiency, as the set of choices from which firms choose managers would be smaller,” Mr Michelson said.

“The possible resulting deterioration of quality in the public sector would, paradoxically, lead to an erosion of public trust in the Public Service.”

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