Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 1 - 19)




  1. Order, order. Welcome to the Committee of Public Accounts of the House of Commons. Today we are discussing royal travel by air and rail and I welcome Sir Richard Mottram. Perhaps you could introduce your colleagues.
  (Sir Richard Mottram) Perhaps I should say that I am the Permanent Secretary for the Department for Transport, Local Government and the Regions. Sir Michael Peat is the Keeper of the Privy Purse and Ian McEwen is the Command Secretary of Strike Command in the Ministry of Defence.

  2. Welcome all of you. May I start my questioning with Sir Michael? You have managed to achieve significant savings. Do you expect to maintain this trend by shifting between different types of transport?
  (Sir Michael Peat) No, we are probably getting quite close to an irreducible minimum. When the NAO did their report, they said that they expected us to continue to increase at between 5 and 2 per cent a year. We shall do rather better than that and indeed costs have come down since they did their report, but we are getting close to the bottom. There is never room for complacency and we shall always be looking for additional savings, but we shall soon get to minus territory if we carry on at the rate we have done in the last four years.

  3. May I ask a couple of questions about an article which appeared in the Sunday Telegraph which you might have seen?
  (Sir Michael Peat) If it was last weekend, yes I did.

  4. Can you just confirm that the principal purpose of 32 Squadron is military and that therefore it is appropriate to base charges for other users, including the Royal Household, on variable costs?
  (Sir Michael Peat) Yes. For example, in the year 2000-01 we used 8 per cent of 32 Squadron flying hours, so clearly the principal purpose of the Squadron is not to look after the Royal Family; it is for other purposes.

  5. Was this article correct in terms of the Prime Minister being subsidised by the Queen?
  (Sir Michael Peat) No, I would not say that was correct in the article. While the NAO have said that the Royal Household and the grant-in-aid were charged too much money during 2000-01, it is only really recirculating public money in any event. We are provided the money by means of the grant-in-aid and then we pay a certain proportion of it back to the Ministry of Defence for use of 32 Squadron. The point is not that the Royal Household were overcharged, it is more of a presentational point in that, because of the higher rates previously, it made royal travel seem more expensive than it actually was.

  6. Will the new variable cost rate also apply to private journeys and why should it?
  (Sir Michael Peat) In paragraph 3.13 of their report, the National Audit Office have recommended that it should apply to private journeys, so I assume that that is the rate the Ministry of Defence will charge us for private journeys and indeed it is the rate they are charging us at the moment.

  7. I think that answer is yes, the variable cost rate will apply to private journeys.
  (Sir Michael Peat) Yes.

  8. Now that we are charging royal travel at this variable cost, has there been any change in the use of 32 Squadron?
  (Sir Michael Peat) Yes, there has been a significant change. In the year 2000-01 we used 291 hours of 32 Squadron. We were planning to reduce to 105 hours of 32 Squadron in the current financial year, because it was a bit expensive for us. As a result of the lower prices, we shall probably use round about 380 hours of 32 Squadron flying time this year.

  9. May I ask a question about the royal train? It is only used about 20 times a year. Savings have been made but the cost per mile of rail travel is still twice that of air. Can you justify this cost and can you justify retaining the royal train?
  (Sir Michael Peat) As you kindly said, we have reduced the cost of the royal train from round about £1.9 million a year to round about £600,000 a year. Having said that, as you have also correctly suggested, it is still expensive and it is an expensive way to travel. It is, however, a way of travelling which has a number of advantages. It enables members of the Royal Family to travel while they are sleeping and during meal times. It provides excellent facilities for changing and for meetings and briefings prior to engagements. It also means that the member of the Royal Family concerned can arrive right in the middle of the town to be visited, at the correct time, with certainty. Particularly during the spring and autumn, helicopters, which are usually the alternative, are prone to disruption by fog, in particular, and it does worry members of the Royal Family that people put a huge amount of time and effort preparing for a visit and everyone is looking forward to it and if they do not arrive, or they are late, clearly that is a matter of some concern. So the train does have a lot of advantages. On the other hand, you are absolutely right in saying that it is expensive. The reason it is expensive is a circular thing really. Because it is expensive members of the Royal Family are reluctant to use it, because they are reluctant to use it and it only gets used a few times a year, it means it gets more expensive.

  10. That is not a justification for keeping it.
  (Sir Michael Peat) No; absolutely. It is going to be used a lot during this year, the Queen's Golden Jubilee year, as the Queen undertakes her tours round the country. As most people know, she is going to visit most parts of the country and she will spend a large number of nights on the train, two or three at a time, using it effectively as her travelling base. The train is very much justified in the current year.

  11. So after the Jubilee year, are you hinting that you will look at it again?
  (Sir Michael Peat) We need to look at it again. We have done well, we have reduced it substantially. There is no room for complacency—it is expensive and we want to consider all possibilities to try to get the unit cost of the train down further. If you ask me how we are going to do it, I am afraid I cannot say at the moment. We really are going to think about it. The experience of the Jubilee and the exposure the train will get during this Jubilee year will help us in those considerations.

  12. You will do a serious study on the future of the royal train once the Jubilee year is over.
  (Sir Michael Peat) Yes, that is the intention.

  13. Sir Richard, how much would you earn by selling off the rest of the royal train?
  (Sir Richard Mottram) Very little. We earned about £200,000 from selling off a few of the coaches and the coaches are actually old stock and have a very limited value. I would guess we are talking about less than £1 million; that is probably an over-estimate.

  14. I am told it is not a grand luxury Czar's train, but more 1960s laminate. Is that right?
  (Sir Richard Mottram) I think the answer to that is yes.
  (Sir Michael Peat) Exactly. It is Formica and aluminium from First Class 1960-70. We can all remember it.

  15. May I ask about the visit of the Earl and Countess of Wessex to Bahrain and Qatar? There was some controversy surrounding that because it was alleged that they were using royal travel to further business interests. Can you tell us a bit about what changes you have made following that visit?
  (Sir Michael Peat) None at all really. Those were stories and speculation in the newspapers which as far as I am aware had no basis whatsoever. The Earl and Countess of Wessex went there at the request of the Foreign Office; the visit, as all those visits are, was requested by and approved by the Royal Visits Committee. Some stories appeared in the newspaper but I do not think there is any justification or basis for them whatsoever.

  16. I have been advised—maybe the advice was wrong—that the Palace promised to review its arrangements where public and private business were combined.
  (Sir Michael Peat) Yes, we did do that and we have done that. That was nothing to do with the Earl of Wessex's visit to Bahrain; that really came out of the story in the News of the World about someone dressing up as a sheikh, if you recall that?

  17. I do remember that very well. Do you want to tell us a tiny bit more about that?
  (Sir Michael Peat) About the sheikh?

  18. No, not about the sheikh; we have heard enough about the sheikh. In particular may I direct the questioning a bit further. Are private secretaries required to confirm in every case both in advance and retrospect, whether private business or social travel is planned or has occurred?
  (Sir Michael Peat) Yes; absolutely. As you would expect, our internal rules within the Household are absolutely clear that not only should there not be any conflict of interest, but there should not be any reasonable case for anyone to believe that there is any conflict of interest in respect of any official visit or indeed any official engagement. If that might be the case, the guidelines are absolutely clear that the member of the Royal Family should not undertake the visit or the engagement.

  19. If we look at Appendix 2 of the report, we see that the royal party can sometimes be very large. We have 38 people on page 12, 48 people in the first case on page 31. I understand some of these will be for state visits but can you tell us a bit about the controls you have within the Household to ensure that the party sizes are reasonable? Can you tell us why you really need 48 people?
  (Sir Michael Peat) The only time you have a visit on which that number of people go is when the Queen is undertaking an official state visit overseas and there are generally two of them a year and then Her Majesty is accompanied by large numbers of people: private secretaries, press secretaries, she has a doctor, she has to have personal domestic staff to look after her. On these visits she also entertains at what we call the return banquet and therefore there are catering arrangements which have to be dealt with too when the Queen entertains her host, the head of state who has asked her there. It is only on those visits when large numbers go. For all the other visits numbers are relatively small. Sometimes numbers are swelled by journalists, for example, but they are re-charged, so they are not a cost to the grant-in-aid.

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