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Session 1999-2000
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Standing Committee Debates
Government Resources and Accounts Bill

Government Resources and Accounts Bill

Standing Committee A

Tuesday 18 January 2000

[Mr. John Butterfill in the Chair]

Government Resources and Accounts Bill

10.30 am

Mr. David Davis (Haltemprice and Howden): On a point of order, Mr. Butterfill. I am concerned about the accuracy of the official record of our proceedings because they have a constitutional dimension and will be examined by members of the other place. It is important that not only the report of our proceedings, but what is said during them is accurate. Last Thursday morning, the Economic Secretary to the Treasury told the Committee, when referring to my amendment No. 24, that

    "the amendment would prohibit the flexibility to adopt the new and revised standard because the format would be specified in the Bill."--[Official Report, Standing Committee A, 13 January 2000; c. 96.]

An exchange followed between my hon. Friend the Member for West Dorset (Mr. Letwin) and the Economic Secretary, who intimated, no doubt with briefing from her civil servants, that such detail was not specified in the Companies Act 1985. I would not want that to be taken as authoritative by anyone who reads our proceedings--people may take the Treasury's view as authoritative. I have made available the relevant part of the 1985 Act, which highlights in more detail than my amendment the requirements on companies. Is it possible to make those pages available to all members of the Committee, because the 1985 Act clearly prescribes the form and content of the accounts to be submitted, unlike my amendment, which was straightforward and limited to the principle rather than the detail?

The Chairman: That is not a matter for me, as the right hon. Member is aware, but I have no objection to the papers being made available for the convenience of the Committee.

Clause 6

Resource accounts: scrutiny

Amendment proposed [13 January]: No. 33, in page 4, line 2, at the end to insert the words--

'(3A) The Comptroller and Auditor General may examine any performance statement which he receives from a department under section 5(4A) and report thereon.'--[Mr. David Davis.]

Question again proposed, That the amendment be made.

Mr. Oliver Letwin (West Dorset): My right hon. Friend the Member for Haltemprice and Howden (Mr. Davis) has been reading the Committee's proceedings, and I was doing the same late last night. I must beg the Committee's indulgence because, perhaps as a result of inspecting the inelegance of my exposition or the incoherence of the Economic Secretary's logic, I developed a severe eye infection and had to go to hospital late last night to have it dealt with. I discovered that under the new Labour Administration, the accident and emergency unit at Guy's hospital has been moved and that I had to traipse across London, as a result of which I am somewhat lacking in complete coherence today. I hope that the Committee will forgive me if I take a little longer than usual to get to the point.

I was explaining why we must support amendment No. 33. I reflected on the comments that have been made and perhaps the best and quickest way of making my argument is to examine the contrapositive position. Let us suppose that amendment No. 33 had been proposed in the opposite sense and that instead of saying that

    "The Comptroller and Auditor General may examine any performance statement which he receives",

it had proposed the opposite and stated that

    "The Comptroller and Auditor General may"


    "examine any performance statement".

That would have been a remarkable amendment. All members of the Committee will agree that the Comptroller and Auditor General has, through the many tenants of that office, always performed the role of acting for Parliament in the public interest. It would be remarkable if such a person were prohibited form examining performance statements that he receives.

As I understand it, all that my right hon. Friend's amendment would ensure is that we enshrine in law the principle that we would not wish to see defeated in law: the Comptroller and Auditor General may examine any performance statement. It is an extraordinarily weak amendment. My right hon. Friend could well have tabled one suggesting that the Comptroller and Auditor General must examine any performance statement or that Departments must submit performance statements. The amendment would simply ensure that no one can interpret the Bill as in any way prohibiting the Comptroller and Auditor General from examining performance statements.

I cannot believe that it can be the intention of the Economic Secretary or the Government so to prohibit the Comptroller and Auditor General, so I hope that we will hear either that she and the Government accept the amendment or that, again, an amendment is not necessary. If the latter is the argument, I suppose that there is more merit in it in this case than in some others, because I can see that, in the absence of a prohibition, it could be argued that the Comptroller and Auditor General may examine the statements. However, my right hon. Friend, in his capacity as the Chairman of the Public Accounts Committee, has told us that he and his colleagues on the PAC and the National Audit Office believe that there is a doubt. I hope that the Minister will make an unequivocal statement that the Government would expect the Comptroller and Auditor general to examine such of the performance statements as he wants to examine and would be enabled to do so, and that, if they do not want to accept the amendment, they will clarify the Comptroller and Auditor General's ability to examine the performance statements in some other way. That is a minimum condition of acceptability.

I want to relay to the Committee the fact that, in another incarnation, the guru on these matters said something very interesting. I am not often in receipt of letters from those who are not constituents of mine, as nobody who is not a constituent of mine has ever heard of me, but I was in receipt of a letter from someone called Mr. Des McConaghy of 5, Glenluce road, Liverpool. In this extraordinary democracy of ours, Mr. McConaghy has been following our Committee's proceedings in great detail. He wrote to the secretary of the Public Accounts Commission and to me. He has been reading the book written in 1998 entitled "Public Expenditure: Who really controls it and how?", which was written by none other than the head of the Government accountancy service, Professor Likierman. Mr. McConaghy has drawn my attention to this book.

I know, Mr. Butterfill, that you upbraided our colleagues on the Liberal Democrat Bench when they sought to give what the Economic Secretary later uncharitably called a book review. Although I would not have the temerity to offer any review of a book written by the head of the Government accountacy service--albeit before he became head of it--I want to relay to the Committee the direct relevance to my right hon. Friend's amendment of his statement in that book. In his book, Professor Likierman said:

    "This situation"--

the relationships between Parliament, the Comptroller and Auditor General and the PAC on one side and the Government on the other--

    "may not be satisfactory for supporters of open government".

He was right about that; it is not. Nor, he said, might it be satisfactory for supporters

    "of a stronger role for Parliament"

He was right again: it is not satisfactory for those of us who want a stronger role for Parliament. He went on:

    "If a stronger role does emerge, departmental Select Committees are likely to be the engine pushing it forward."

That is the point behind my right hon. friend's amendment. By giving the Comptroller and Auditor General the ability to review performance statements, Select Committees will be alerted to the significance of such statements, which will give them another lever with which to begin the awesome and tremendously important task of bringing the Executive to heel and trying to ensure that they are living up to their own performance statements.

Mr. Edward Davey (Kingston and Surbiton): Perhaps the hon. Gentleman has not only received a letter from Des McConaghy, but has had a chance to read that gentleman's article in the October to December issue of Public Money and Management, entitled "Measuring (Accountable) Success-Analysis of "The Government's Measures of Success'". At the end of his article, Mr. McConaghy states:

    "A systematic external process of validation is a technical and a constitutional necessity."

He has put his finger on the issue. If we were to follow his advice, we would certainly vote for the PAC's amendment.

Mr. Letwin: The hon. Gentleman is, as so often, right. [Interruption.] The fact that he represents the wrong party does not mean that he cannot occasionally be right. I believe that that is referred to as big-tent politics by Government Members.

The Chief Secretary, the Financial Secretary and the Economic Secretary should have accepted the offer that I made towards the conclusion of the debate on Second Reading that we would withdraw our amendment if the Government set up a Special Standing Committee before which evidence could be brought. People such as Mr. McConaghy would then have been able to appear before us and expose matters such as that raised by the hon. Member for Kingston and Surbiton (Mr. Davey). Perhaps the embarrassment to the Economic Secretary of having to accept this eminently sensible amendment, or the worse embarrassment of having to reject it, would not then have arisen. She would have been able to hear such evidence and rephrase the Bill of her own accord.

However, that did not happen, and we now need to find the levers with which the PAC and departmental Select Committees can publicly scrutinise the Government's performance. Unless those performance statements can be so inspected, there is no point to them other than glitz and glitter. The over-modest amendment, with its merely permissive intent, represents the minimalist position, and deserves the Committee's support.


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