Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 80 - 99)



Mr Rendel

  80. May I ask how often journeys are made within any one month which were not forecast to be made at the time that the grant-in-aid was drawn down for that month? For example, I can quite understand you might have to go on a hurried visit if a foreign potentate died and was buried and you went out for a state funeral. How often does that happen?
  (Sir Michael Peat) It happens; it has happened in my recollection three or four times in the last two or three years. Not often.

  81. On average you would not get any unexpected journey.
  (Sir Michael Peat) It is not always overseas. It is if there is a disaster, the floods, or if there is an air crash or something special happens and a member of the Royal Family goes. Engagements do come up at short notice, that is the whole point of the job. Members of the Royal Family do go on them.

  82. But what you are saying is that it happens pretty infrequently.
  (Sir Michael Peat) No more than two or three a month I would have thought.

  83. I am interested in the fact that the average cost of a normal journey seems to be up to about £50,000 . There are some which cost a lot more than that but they on the whole are the state visits which are obviously not coming up at the last moment.
  (Sir Michael Peat) Do you mean a normal overseas journey?

  84. Yes or indeed in this country. Not more than £50,000 per visit on the whole. The appendices show that the cost of travel is not in general more than about £50,000 except for the state visits which obviously cost more but we know about the state visits a long time in advance so they are not emergencies. Given that you are saying perhaps two or three a month, does that not mean that the contingency sums you are looking at are still in excess of the real need? Contingency is presumably there for these unexpected visits. The amount of money you are going to be spending on unexpected visits is the number per month times the maximum cost and it is still a lot less than the contingency amount.
  (Sir Michael Peat) I have to say we are talking about tens of pounds rather than hundreds of pounds in this issue. The contingency was originally set at 2 per cent of the grant-in-aid and in the NAO report the figure of £300,000 is referred to. The reason why the contingency seemed larger than necessary was because it was not reviewed on a monthly basis. It was set on an annual basis and, due to our success in reducing expenditure, the 2 per cent figure dropped quite substantially. As the NAO also say in their report, we have excellent working capital management systems for investing any spare money immediately on the money market. So I very much hope that the amount of money lost to the taxpayer as a result of the contingency being £50,000 or £100,000 higher than it need be is not even into tens of pounds because our working capital control system, if I can say so immodestly, is excellent.

  85. I accept that. May I go on to some questions on the royal train? I understand that the royal train was handed over by British Rail to Railtrack at nil cost when Railtrack came into existence. Parts of it were then sold and the proceeds, some £235,000, went to the Department, although it was owned by Railtrack. I do not quite understand why Railtrack allowed the money to go to the Department if they owned the train. Admittedly they got a very good deal, because they got it at nil cost when it must have had a value.
  (Sir Michael Peat) It is technical ownership. There is quite a complicated memorandum of agreement between Railtrack and the Department and effectively rights of ownership are exercised by the Department because the Department have the right to require Railtrack to transfer the train back to them for nil consideration. When we say it is owned by Railtrack, it is not the sort of ownership that most of us would recognise.

  Mr Rendel: I agree.
  (Sir Richard Mottram) It is just a convenience.

  86. I think not. If the royal train were to be sold, what alternatives would have to be used?
  (Sir Michael Peat) Not much, I am afraid. As we said earlier, it is good old-fashioned 1960s/1970s First Class rolling stock.

  87. What else would the Royal Family use? If you decided to sell the royal train, what else would the Royal Family use?
  (Sir Michael Peat) They would have to go by plane, scheduled train perhaps, depending on the requirements of the engagement. Some of the engagements would not be possible.

  88. So there is a real genuine need for some engagements.
  (Sir Michael Peat) Yes.

  89. They could not be done without the royal train being there.
  (Sir Michael Peat) Absolutely.

  90. How many of the journeys on the royal train were reimbursed at all in terms of taking private people or press members on the royal train?
  (Sir Michael Peat) None at all.

  91. Nobody travels on it.
  (Sir Michael Peat) We tried with the Department to get other government users to use it in 1997. We would very much have liked other people to have used it, but unfortunately, because it is mainly configured for overnight accommodation and does not have particularly good conference and dining facilities, people were not that keen.

  92. I imagine there might be people from the press for example in London who wanted to go out on a visit which a member of the Royal Family was going to do, say to Cumbria, who might be prepared to pay to go that way.
  (Sir Michael Peat) We have not come across those people yet.

  93. Have you tried?
  (Sir Michael Peat) Yes, we have. We do try quite hard. The trouble is that the train is mainly just for sleeping overnight on. It leaves quite late at night and it is used so the member of the Royal Family can do an engagement, a dinner engagement or something in the evening, and they can go to the station at eleven o'clock at night and then be in the middle of the town first thing next morning. That unfortunately is an arrangement which does not always—

  94. I am amazed that in order for up to nine people, which in Appendix 2 is the greatest number of members of the Household who travel on the train in any of the three journeys listed, to travel you have nine coaches.
  (Sir Michael Peat) Not all the coaches are used at once.

  95. I am glad to hear it.
  (Sir Michael Peat) Two of the coaches are not for people: one is for electrics and the other is for security and communications. You also do have to have a coach for food. Even if you have nine people, they still have a right to be fed, so it is not quite as simple as that because you do not have all the facilities—

  96. So a coach at most for the food, a coach for the electrics, a coach for the security, one coach must take nine people sleeping. You presumably never have more than four coaches at once on the train.
  (Sir Michael Peat) It varies between five and seven. The nine people does not include the railway support staff who run the train who have to have somewhere to sleep as well. The nine people are the royal party.

  97. On page 30 of Appendix 2 a journey was made by the Prince of Wales in the royal train up to Cumbria where he later used the Household helicopter. If you are going to take the helicopter up to Cumbria why do you not take the Prince of Wales with it at the same time?
  (Sir Michael Peat) Because the helicopter would have taken an hour and a half to get there.

  98. Which is a lot quicker than the train.
  (Sir Michael Peat) It was a very important day's meeting and before going to the meeting, if you do any job you have to do it well, he would have to have briefings, he would have to go through the day's schedule and that would have meant he would have had to get everyone together before he left round about six or seven in the morning to go through it all because you cannot do those sorts of briefings on the helicopter. It was felt that it was unreasonable to get everyone together for the briefings at that time in the morning. Also, not only was it unreasonable, but it would compromise the possible success of the day by introducing too much of a wear and tear element into it. It was a very important visit.

  Chairman: Thank you for your questioning on the royal train, Mr Rendel. I think we now know that the royal train is not as crowded as Connex South East.

Mr Bacon

  99. I should like to start by asking about the overall costs which it says right at the beginning of the report have fallen from £17.3 million four years ago to £5.4 million which is very impressive, particularly because you have kept the amount of travel in total seemingly about the same; air travel about the same and rail travel more than double. It does beg the question of what was going on before. Is it fair to say that before you started to run the show there was a rather slack attitude which you have stamped out?
  (Sir Michael Peat) I am pleased to say that I am not in a position to answer that question because I obviously was not responsible. I would say that there is no doubt that bringing together user and financial responsibility, which was the purpose of the grant-in-aid, so that one department was responsible both for determining the journeys and for controlling the costs, is always a good thing and that was achieved by means of the grant-in-aid and gave it all greater focus.

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