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Mr. Fabricant: My hon. Friend said something from a sedentary position that was not too far from the truth, but which I hope will not be recorded in Hansard.
Mr. Stephen O'Brien: The equivalent is even more serious--where a company would resist allowing any kind of audit treatment of a joint venture or some form of minority participation. That is clearly laid down under "general accounting principles"--a phrase that, interestingly, appears in the Explanatory Notes and the Bill, and is therefore directly to be applied. My hon. Friend's point is well made.
Mr. Fabricant: My hon. Friend makes a marvellous point. It is particularly apposite, given that the Government talk about private-public partnerships and building on the private finance initiative, which was introduced by the previous, Conservative Government. Is not that a joint venture and does it not therefore warrant independent audit? However, the Government say, "No, we will not allow an independent auditor to investigate for the benefit of the state and society as a whole."
We are going through a period in which there is mistrust of the Government's motives. We hear about financial initiatives that are merely launches of relaunches of previous launches involving fresh money that turns out not to be fresh. [Interruption.] We read about that not only in The Times, but in The Guardian, which is read by the hon. Member for Brent, North (Mr. Gardiner). We realise that there is disquiet in society as a whole. The Government could easily allay that by saying, "We will allow independent auditors into all aspects of government. They can report to the Public Accounts Committee and lay reports before Parliament." The Treasury could also lay before Parliament information that would make all audit reports open and file it in the Library of the House of Commons. [Interruption.] The hon. Gentleman laughs,
but his seat is marginal. Would not it be to his benefit and that of society as a whole for the Government to be seen as open and honest? Is not it dishonest for any Government to introduce an incomplete Bill that does not consider the universal practice of auditing, but says that audits will not be permitted in certain barred areas?
The Executive should not be allowed to choose which areas may be audited and which may not. If I may coin a phrase, this should be the people's audit. Is not any audit the people's audit? The people's audit concerns the welfare of the people as a whole. Are they not the people's Government? Perhaps no longer.
Mr. Hayes:
To firm up some of my hon. Friend's slightly vague remarks, may I refer him to the Second Reading debate on the Exchequer and Audit Departments Act 1921? This was stated explicitly:
Mr. Fabricant:
My hon. Friend, with his customary charm and politeness, makes a powerful point. The discretion should lie in the hands of the auditor, not those of the Government.
Mr. Barry Gardiner (Brent, North):
Will the hon. Gentleman give way?
Mr. Fabricant:
Oh, the hon. Gentleman awakes. I am delighted to give way.
Mr. Gardiner:
I have been in the Chamber for considerably longer than the hon. Gentleman. If he can recall the remarks he has just made, can he justify them against the new clause in favour of which he purports to be arguing? It allows the Executive precisely that power of veto, which he has spoken against.
Mr. Fabricant:
Not at all. If the hon. Gentleman reads the new clause, he will see that that is up to the CAG. Although he is in the Chamber, I can assume only that he has allowed his attention to lapse.
Mr. Fabricant:
I shall not give way again; the hon. Gentleman is wasting my time and that of the House. He sits there either not listening or giggling. Either way, he is not concentrating. This is a complicated Bill, and the hon. Gentleman should listen, and then his interventions would be pertinent rather than irrelevant.
Mr. Gardiner:
The hon. Gentleman should read the new clause.
Mr. Fabricant:
The hon. Gentleman tells me, from a sedentary position, to read the new clause. I am
As my hon. Friend the Member for South Holland and The Deepings said, the discretion should lie with the CAG, precisely as it does with an auditor who investigates any commercial operation and has independence in doing so. The point of new clause 2 is to give the CAG independence. He will have no independence if the Government tell him that there are areas that he may investigate and areas that he may not investigate.
Mr. Brady:
It is a point of fact, which should be put on the record, that the hon. Member for Brent, North (Mr. Gardiner) is entirely mistaken, as the Minister can lay an order to exclude a given public body with the approval of Parliament. We have been debating precisely the point that those powers should reside with Parliament and the CAG as an agent of Parliament, rather than with the Executive.
Mr. Fabricant:
My hon. Friend is absolutely right. It is up to Parliament and the Public Accounts Committee to determine, through the CAG, those areas that ought to be audited. It would be wrong for the Executive to determine that because the CAG would not be independent. I hope that the Minister can satisfy me that if I am wrong, the Public Accounts Committee and hon. Members on both sides of the House who have been arguing for new clause 2 are also wrong. However, I do not think that I am wrong. Surely the whole point of an auditor is that he should be independent. I hope that the Minister will address that point in his reply.
Mr. Brady:
It is a privilege to participate in what has been an excellent debate, albeit at this late hour. I echo the remarks of my hon. Friend the Member for Lichfield (Mr. Fabricant), because I was looking forward to one more in a series of excellent and incisive speeches when the hon. Member for Workington (Mr. Campbell-Savours) trailed the fact that he had prepared a speech and given great thought to it. I am sure that it would have been a speech of great consequence. We have had several excellent contributions to the debate.
Mr. St. Aubyn:
Does not my hon. Friend think that it is a bit rich for the hon. Member for Workington to criticise--
Mr. Deputy Speaker:
Order. We shall forget about the hon. Member for Workington and get on with the new clause.
Mr. Brady:
I had forgotten about him already, Mr. Deputy Speaker.
We have heard from many right hon. and hon. Members on both sides of the House how important the provisions are. My right hon. Friend the Member for Haltemprice and Howden (Mr. Davis), the Chairman of the Public Accounts Committee, said that in discussing the amendment we are dealing with matters of public expenditure amounting to some £3 billion a year. My hon. Friend the Member for Guildford (Mr. St. Aubyn) suggested that the figure might be greater if we included companies in the new clause as well as non-departmental public bodies.
Even though we have not included companies, we are dealing with a large sum of public expenditure, and it is a serious matter that is appropriate for debate by the House, whatever the hour. I wonder whether Liberal Democrat Members agree that it would have been a great tragedy if Gladstone had decided in 1866 that, because it had got rather late in the day, he would not bother introducing the vital legislation that allows Parliament to hold the Executive to account and which introduced the proper audit and control of public expenditure that we have today.
The hon. Member for Brent, North (Mr. Gardiner) was wrong to suggest that the new clause gives Ministers unfettered discretion. It does not. It gives some powers to Ministers, subject to approval by Parliament, which is entirely right.
We have heard important contributions. I do not want to speak for long in this short debate, but I want to comment on the remarks of the right hon. Member for Swansea, West (Mr. Williams) who, I thought, made the most telling contribution, albeit a brief one. It was a devastating account of the way in which the Treasury has dealt with the progress of the Bill. It did not accept at an early stage, as it could have done, important recommendations from Members of all parties with proper independent backing. That was a great tragedy.
The general trend of the changes proposed--
to the 1866 Act--
is to give greater discretion to the Comptroller and Auditor General as to the extent of his audit, and to make his measures more elastic.--[Official Report, 5 August 1921; Vol. 145, c. 1883-84.]
Is not my hon. Friend saying that this should be an opportunity to extend the scope--the elasticity--of the CAG's remit, not to give more power to the Government to decide precisely where, how and when he goes and how that information is published?
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