Examination of Witness (Questions 1 -
19)
TUESDAY 13 JULY 1999
MR ARCHY
KIRKWOOD MP
Chairman
1. Welcome to the Committee. You are, of course,
Archy Kirkwood, Chairman of the Social Security Select Committee.
The first question is a general one. Could you explain the circumstances
in which the Social Security Committee decided to ask Mr Touhig
to make representations to the Treasury?
(Mr Kirkwood) Thank you. Firstly, can
I say that I am deeply grateful that your Committee is able to
take the responsibility for investigating the consequences of
this leak. The responsibility I have as a minority Chair of the
Select Committee is difficult enough, but the atmosphere that
is produced when there are allegations and inquiries of this kind
can be quite damaging. So it is a relief to be able to turn to
a higher authority to make some of the ultimate decisions and
I understand that there are precedents that you have to take account
of that ordinary departmental Select Committees do not have to
do. There are one or two things that I think might help the Committee
by way of understanding the context of the circumstances which
led to this leak. The first thing I would say is that before any
of this happened we had a rather unfortunate and very untypical
incident where the Secretary of State for Social Security, Alistair
Darling, indicated quite serious displeasure about the way we
treated a Report that he had given us and on investigation of
that I think he may well have been right. There was a fraud pilot
project done on Family Credit just before all this blew up and
there was a methodology study done by the Department of Social
Security and we had been pressing to see this. He eventually gave
it to us and we promptly published it and he understood that we
were being given it in confidence. So there was a bit of constructive
tension between the Committee and the Department and all I can
say is that if the exchange I had with the Secretary of State
when he found out about this was anything to go by I would not
have liked to have been there when he spoke to the Labour members
on the Committee. I think that the Labour members were feeling
a bit bruised by that. I think it was a genuine misunderstanding
and it does not have any other bearing on the work of the Committee
this morning in considering this leak, but the Labour people I
think were slightly sensitive to the fact that the Government
were not best pleased with the way things had worked out. I should
also say that you will see from my own Committee's Third Special
Report that the membership of the Committee since its nomination
on 14th July 1997 has been varied. In fact, there are only four
other members, including myself, who have survived since the Committee
was set up. I have come to adopt the working practice of treating
Chris Pond as the senior Labour member for a variety of reasons.
Chris Pond has got a very distinguished record in the field of
the Committee's work and he has assumed the responsibility for
being my main link as a third party Chairman on the Committee
with the rest of his Labour members on the Committee. I think,
therefore, he was the person who was perhaps in the front line
of the Secretary of State's displeasure in relation to the Family
Credit fraud pilot study misunderstanding. The Committee itself
had to face some quite unusual circumstances to the extent that
we engaged in this Report into the taxation of Child Benefit and
we did so against the background of the Chancellor himself asking
for a public debate on the issue prior to the Budget statement
that he was about to make. We think the debate did not really
happen properly and to the extent that we would have liked and
so we undertook the Report to try and fill that gap. The Committee
met and took some evidence on the 16th December. It was a session
of evidence which involved three sets of witnesses and they were
all fairly critical of the administrative arrangements surrounding
the introduction of the taxation of Child Benefit. I acted on
that and following the evidence as best I could produced a draft
Report which actually took a very clear point of view, which was
that the game was not worth pursuing because of the logistical
difficulties. I was considerably upset by reading in the Sunday
newspapers, I think it was the Observer at the time, that
the Treasury officials had actually found ways round some of these
administrative difficulties. It was clearly a systematic brief
for Patrick Wintour and I got very, very annoyed because, as you
will know, in the Liaison Committee I had already indicated that
I was having difficulty getting a response from the Treasury in
terms of sending officials to deal with some of our questions.
There is obviously a bit of tension between a departmental Select
Committee on Social Security and Treasury officials. We do not
have the same relationship as we do with Department of Social
Security officials. As you may recall, I was so upset at the way
we were being treated and that the leaks were appearing in the
newspaper dealing with exactly the sort of territory that we were
really interested in that I took a quite strong point of view
in the Report that I produced, the draft of which was circulated
to members of the Committee on the 4th February. It was pretty
antipathetic to the idea of the introduction of the taxation of
Child Benefit and I believed that that followed the evidence that
we had heard at the time. The draft Report that was produced on
the 4th February occasioned a letter and a series of amendments,
some 40 in number, from Chris Pond and they arrived in my possession
on Tuesday 9th February and the Committee deliberated on the 10th
February. It became quite clear to me at 10.35 am on Wednesday
10th February that I had over-egged the pudding and that although
I was getting some support from the Conservative members on this
very strong line that I was taking antipathetic to the administrative
and logistic difficulties of the taxation of Child Benefit, I
had gone too far, that I could not carry a consensus within the
Committee and that to try and salvage what was a very pointed
Report arguing a case by a series of 40 amendments was going to
be a very inelegant process and so I withdrew the draft and I
decided that I would listen to colleagues' views, go away and
write another draft which better reflected their consensus views
as expressed at that meeting. The timing here is quite important.
At the moment that meeting ended, at one o'clock on 10th February
the draft Report which was circulated on the 4th February was
withdrawn, it was no longer a working document that had any relevance
because I understood that the Committee would not have accepted
it in its original form. One could answer—and this may be
an important point for your Committee—that if that report
came into anyone's hands at ten-past one on Wednesday 10th February
it would have made no odds either way because it was no longer
within the contemplation of the Committee as I had taken it back
in order to prepare a better draft. On Thursday 25th February
I produced a revised draft Report. By that time Treasury officials
had been to see the Committee, because one of the things that
we decided on Wednesday 10th February was that, having regard
to the Sunday newspaper leaks and having regard to the importance
of the practicalities of the policy being proposed, we really
had to have further and better particulars from Treasury officials
or, indeed, Ministers. Before we broke up on Wednesday 10th February
I made it clear, particularly to the Labour members of the Committee,
that if we were to get access to better Treasury advice on the
practicalities of the implementation of the policy we needed Labour
members to put pressure on Labour ministers to send Treasury officials.
And just before the Committee suspended its session for the morning
on that Wednesday 10th February my Clerk uttered the sentence,
"Mr Don Touhig has an important role in trying to bring about
the appearance of Treasury officials at this Committee",
and that was a clear signal to the Labour members that we all
had to use our best endeavours to try and get access to Treasury
officials. I immediately telephoned Gordon Brown's office and
told him indirectly about this as I was not able to speak to him
myself, he was on other duties outside London. Then I wrote a
letter saying that the Committee really did require the assistance
of the Treasury to make sense of the final stages of the Report
and we all went away to use our best endeavours to try and bring
about an appearance by Treasury officials. This clearly worked
because the very next day I got a message to say that Treasury
officials would be with us the following Tuesday and so something
clearly had happened. We had achieved the end that we had set
ourselves and the Treasury officials then gave evidence on Wednesday
24th February. Their evidence substantially clarified some of
the difficulties that I had personally had in my mind about the
practical difficulties and made it easier for me to produce the
revised draft Report on the 25th February which made the whole
situation slightly easier and we then moved to consideration of
our Report which was considered by the Committee on the 3rd March
and agreed. At that meeting of 3rd March Chris Pond again tabled
a whole series of amendments and the Child Benefit Taxation Report,
the Fourth Report of my Committee in the session 1998/99, clearly
indicates that seven of those amendments had to be dealt with
by my putting questions to the Committee and the Committee dividing
on party lines. So the revised Report, after we had seen Treasury
officials, was substantially amended by Chris Pond. I was at this
stage aware that there could be some suggestion that Chris Pond,
having lodged substantial numbers of amendments to both drafts,
could have been encouraged to think about tabling amendments which
were not his own. I made it very difficult for him in the course
of tabling these amendments by using pressure of time to propose
amendments that had been put in his head by other people. I am
absolutely convinced myself, and this is my own judgment as best
I can arrive at, both from knowing Chris Pond for a long time
and the way that he handled what essentially were very technical
amendments, the likes of which departments would be hard put to
it to contrive to put into his head, that he dealt with these
expeditiously, under pressure of time, without hesitation, deviation
or repetition and I am absolutely confident he could not have
accomplished that had he been dealing with ideas that had been
put to him by other people. So from where I was sitting at the
end of that meeting on the 3rd March after he had proposed the
amendments—and some of the 40 amendments that he had proposed
were perfectly acceptable to the Committee and to me—there
was absolutely nothing untoward about the way that Mr Chris Pond
conducted himself either in the tabling of the original 40 amendments
or the substantial number on the 10th February or the substantial
number that he tabled on the 3rd March. So any press comment or
any comment from other members of the Committee that you may have
seen or that have been made either in public or in private I think
are unjustified. I certainly do not think myself—and this
is my own judgment, I cannot prove it—that there is any
way that Chris Pond himself personally could be implicated in
the leak simply because of the fact that he had tabled numerous
sets of amendments at both drafts of this Report that my Committee
tabled. So we got to a position where we had an agreed Report.
There were then all sorts of allegations in the press about the
Report being "watered down". I think myself that that
is explained by the fact that because we had access to the Treasury
officials they were able to deal with a lot of our worries and
misgivings that had been put to us by the witnesses that we had
in the evidence session. In conclusion, my own opinion is that
I do not believe the leak represented a substantial interference
of the work of the Committee in that I think that Chris Pond would
have moved his sets of amendments from within his own resources
and the content being supplied by his own experience and knowledge
in the field and so I do not think that the leak constituted a
serious and substantial interference with the work of the Committee,
save to say that the Report that the Health Committee did in 1991/92
adverted to the fact that by virtue of the fact that there is
a leak inquiry going on it certainly does contribute to an atmosphere
of mistrust within the Committee and that has happened. Secondly,
and this is a point that is more important for you than it is
for me, this is a clear breach of the rules. I guess the good
thing about it is that the Government were honest and open enough
in a written answer to say clearly and without equivocation that
a Parliamentary Private Secretary had taken receipt of a Select
Committee Report. I think that that is beneficial because I think
it will discourage people from doing any such thing in the future,
but it is a technical breach and although there are extenuating
circumstances—and just to remind you, the extenuating circumstance
that I can see is a plea of mitigation that is available to Mr
Touhig, at least prima facie it is available to him, that
he may well have been given a copy of this Report in circumstances
where members of the Committee had asked him to intervene beneficially
in the interests of the Committee to try and get Treasury officials
to appear. Obviously the step of handing a copy of the Report
to him was clearly wrong and a clear breach of the rules and it
can create difficult precedents, but he may be able, depending
on the time and the date on which he took receipt of this Report,
to say that he was doing this in order to try and help and although
it was an offence under the Standing Orders, the circumstances
in which he received the Report were such that he could argue
he was inadvertently trying to help the Committee get to where
it wanted to be. I hope that is helpful.
2. What attempts did you take to uncover the
source of the leak once it had been revealed to you?
(Mr Kirkwood) I took advice from Clerks. I looked
at the precedents and I decided, after taking advice, that we
would undertake a Special Report and we published the Third Special
Report headed the Unauthorised Receipt of Draft Report
on the 26th May. I wrote to everyone who had access to a copy
of the draft at any stage and that includes staff. I myself wrote
to my Clerk in order to make sure that everybody, including my
staff and the Clerk, wrote to me and all of these exchanges are
laid out and published in the proceedings of our Third Special
Report. That received a nil return, i.e. I got no offers of help
from anyone. Everyone wrote back in the negative in various ways
when the question was put, "Can you help me discover how
this leak took place?" It is a pretty unique situation where
we actually know that a copy of the Report was handed to a PPS.
I cannot think of a precedent where we have actually known that
that has happened. That was what we did. We published the Report.
I thought it was serious enough to report to the Liaison Committee.
The Liaison Committee decided that it was, prima facie,
a serious enough situation. They put the question back to my departmental
Committee, as they are obliged to do and we then had a further
discussion about it. The Committee divided on the party lines
and although we took the view that we should pass the matter to
you for further and better consideration because of the precedents
and other implications involved in this, the majority view of
the Committee was that the leak did not come to a substantial
interference with the Committee's work.
3. The division on the party lines was particularly
unfortunate.
(Mr Kirkwood) I did my best to argue my way round
that. My assessment of my Conservative members' view is that they
think I am naive because they believe that there are some uncontrovertible
facts, i.e. the Report was handed across and that substantial
numbers of amendments suddenly turned up on consideration of the
Report. So I think that they think I am being slightly naive in
my assessment that this was actually a coincidence and that perhaps
the provenance of this offence was actually an attempt to help
the Committee achieve its own ends.
Chairman: I have some further questions
on your discussions with Lucy Ward of The Guardian, but
I think we will want to break your evidence at this point to deal
with the evidence that you have given so far.
Mr Williams
4. What you are telling us is that the first
occasion on which it was suggested that Don Touhig be approached
was at 12.50 on 10th February at the behest of your Clerk at the
end of your meeting?
(Mr Kirkwood) That is absolutely right.
Mr Foster
5. Was there any other discussion about how
he should be approached? Was it left to members to determine their
own method of approach or did you have any discussions with anyone
as to what they might say or what they might do?
(Mr Kirkwood) No. My recollection is that as the meeting
broke up there was some discussion in general terms about members
using their own contacts in the most positive way to achieve the
end of an appearance by Treasury officials. There were no methods
of approach discussed. It was left to individual members to use
their best endeavours to achieve the end that the Committee had
set itself.
6. The reference to Don Touhig, did that come
out of the blue or was it the Clerk's formal advice as to how
it might be achieved?
(Mr Kirkwood) Yes, it was. It was just as the Committee
was breaking up and everyone had come to the same conclusion,
that we were on the horns of a dilemma. On the one hand we had
been reading some Reports that work had been done by officials
to crack some of the administrative difficulties. Our own Committee
was deadlocked on the question of whether the practical difficulties
overcame the policy advantages and as the meeting broke up the
discussion was all about trying to put pressure on the Treasury
and Treasury ministers in order to try and get an appearance and
Liam Laurence Smyth at the end, I remember quite vividly, said,
"the Chancellor's PPS is a man who has got an important role
in this regard". I clearly remember him being named not by
anyone other than the Clerk who was trying to advise the Committee
as to how best to get out of this deadlock situation.
Chairman
7. You know that Don Touhig actually asked for
a copy of the Report. (Mr Kirkwood) I do not know that.
Chairman: It is in the correspondence
that I have had with him.
Mr Bell
8. The Committee split on party lines on this.
Is it your personal view that the leak of the draft Report was
a substantial interference in its business?
(Mr Kirkwood) No, it is not. My personal view is that
it was a coincidence and I think that what took place was maybe
naive, but I think it was motivated with the intention of trying
to achieve the Committee's own ends as seen from that perspective
at our meeting on 10th February.
Shona McIsaac
9. You said earlier that after the Committee
broke up on the 10th February you all went away to use your best
endeavours to get Treasury officials to appear. Also, in the Third
Special Report from the Social Security Committee, in the response
from Chris Pond, it states, "With your encouragement I and
other members of the Committee, including Conservative members,
lobbied Don Touhig and Gordon Brown to demand that officials appear
before the Select Committee." I know you said you called
Gordon Brown's office. Did you yourself have any discussions with
Don Touhig about this?
(Mr Kirkwood) No, I did not at all. I did two things.
I immediately left the Committee and immediately after lunch on
that Wednesday I phoned the Treasury and logged in a call with
the Chancellor's staff and they said that they would get back
to me and by the end of the afternoon my Clerk had produced a
letter which I then signed and it was duly despatched to the Treasury
and I did nothing else. I had no time to do anything else because
the next day the Treasury, by some magical process, had agreed
to come the following Tuesday, which I was surprised at. As I
said earlier, I have had difficulty and understandable difficulties,
I do not make any substantial criticisms about this because Treasury
officials are always being dragged everywhere in front of departmental
Committees of all kinds, the Treasury are loathe to become regular
attenders at departmental Select Committee outwith the Treasury's
own remit. I was surprised at the speed with which this question
had been responded to.
10. What validity would you place on Chris Pond's
comment that other members of the Committee, including Conservative
members, lobbied Don Touhig?
(Mr Kirkwood) I have no information about that. I
do not know what individual members did at all. I certainly have
no knowledge about what Conservative members may or may not have
done. All I can say to you is that at the meeting on the 10th
February they were as seized as every other member of the Committee
of the importance of trying to get Treasury members to attend.
11. Also, in the correspondence from various
members of the Committee in the Third Special Report quite a number
of the members of the Committee stated that they handed back the
copies of the draft Report at the end of the meeting. Is that
fairly normal practice?
(Mr Kirkwood) I insisted on it. Having been a member
of the usual channels in the past Parliament with draft Reports
lying around of an uncertain status, as we broke up and as my
Clerk was uttering the sentence that people had to go and speak
to everyone, including Mr Don Touhig, all of the numbered copies
of that Report were handed back in.
12. So no copies of that draft Report left the
Committee room with any member?
(Mr Kirkwood) As far as I am able to judge all of
the numbered copies of the Report were handed in by the end of
that meeting on Wednesday 10th February.
Chairman
13. But the leak had occurred before then.
(Mr Kirkwood) Yes. It was a photocopy. We could tell
it was a photocopy because it was not on our own headed Committee
Office paper which is plain paper, it was on House of Commons
photocopied watermarked paper. So we could tell that it was clearly
a copy. It had been photocopied here in the House. You could say
that it would have had to have been photocopied before the 10th
February because the originals were then all accounted for.
14. When were these numbered copies handed to
members?
(Mr Kirkwood) The draft Report was circulated to members
on Thursday 4th February.
15. So the fact that they handed those copies
in does not mean very much.
(Mr Kirkwood) No, it does not, but at the time I thought
it was an important thing to do just to make sure there were not
copies of a document that had been withdrawn lying around with
an uncertain status.
Shona McIsaac
16. Was this the one and only draft that you
produced at this stage? Were there any earlier drafts at all?
(Mr Kirkwood) None at all.
17. You also stated you knew that it was not
on Committee paper, it was on House of Commons photocopier paper
with the watermark on it. How did you know that? When did you
see this?
(Mr Kirkwood) Mr Touhig, after I wrote to him, gave
it back to us.
18. When did he give that back to you?
(Mr Kirkwood) I think I wrote to him as soon as—
Mr Levitt
19. It was enclosed with his letter of the 23rd
March.
(Mr Kirkwood) Yes, that is right.
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