Examination of Witnesses (Questions 1-19)
2 JULY 2003
FIONA MACTAGGART
MP, MS MARGARET
ALDRED, MR
RICHARD TIPPETT
AND MR
TONY EDWARDS
Q1 Chairman: Welcome, Minister, and
if I may say so congratulations on your appointment. We probably
will have a division, I am afraid, in about 10 minutes time so
I will ask colleagues and the Minister, if she is agreeable, just
to go and vote and come straight back. Thank you and your officials
too for producing a memorandum so quickly. We appreciated that.
As you know, it is an issue which we have looked at before in
relation to the Cabinet Office and the Brazilian timber which
they used in that.[1]
It is part of our responsibilities, as you may be aware Minister,
not only to question you on the Government's policies and the
targets which you have set but also to follow it through. That
is the audit part of our role. Is there anything you would like
to say by way of a brief statement in addition to the memorandum
you have submitted before we begin to cross-examine you?
Fiona Mactaggart: I wanted to
bring the apologies of the Home Secretary, who sent me as the
Green Minister, as his deputy, to speak to you today and just
to introduce the team of people here, if I may. Margaret Aldred
is the Director General, Resources and Performance within the
Home Office. At the end Tony Edwards is our head of buildings
and estate management and Richard Tippett is the department's
environmental issues manager. I also wanted to say briefly to
the Committee that I am glad to give evidence on the issue of
our new building in Marsham Street. The incident which provoked
you might be one which is not necessarily the best example of
it but I do feel really excited as Green Minister that this new
development is going to be a real opportunity for an environmental
improvement both in our use of resources in the department and
also in a neighbourly sense in that the new building we are going
to construct will be a huge advantage in that part of the world
compared with what was there before.
Chairman: I am sure that is true! Thank
you very much indeed.
Q2 Mr Ainsworth: Welcome, Minister.
There is no doubt that almost anything that replaces what was
there before will be a great aesthetic and environmental improvement.
However, as you know, terrific controversy has centred on the
perimeter fence and whilst many people were delighted that this
country became the first to embed sustainable procurement policies
for timber across Government in 2000 the whole policy appears
to be in tatters as a result of presumably carelessness over the
procurement of wood for this particular fence. It would be interesting
to know and I would be grateful if either you or your officials
could tell the Committee when it first became apparent that timber
from illegal and unsustainable sources had actually been used
in this contract?
Fiona Mactaggart: I think the
first thing to make clear is that the issue was not one of oversight,
to start with.
Q3 Mr Ainsworth: So it was deliberate?
Fiona Mactaggart: If I could continue
and then do ask further questions. Most of the plywood panelling
which was used to surround the site and in the walkways and so
on in the site was re-used; it was panels which had originally
existed. There was additional panelling which was purchased. In
the contract requirement that we had with the developers AGP,
there was a clear obligation upon them to ensure that timber which
was purchased for use in the new building conformed to the Home
Office's environmental policy and that meant that it had to be
sustainably logged timber and that in addition its provenance
had to be able to be certificated. The problem was that the contract
did not specify that requirement for timber which was used by
the company to remain in the ownership of the company, as opposed
to timber which was going to be used within the building itself.
This was a flaw in the contract but the contract had been written
at a point when that had not been thought of honestly as a requirement
within Government policy. We signed off the contract in March
2002 and that was before amendments to the Government sustainable
purchasing policy in relation to timber, which made it clear that
not only should we ensure that timber which is purchased for use
within the building and in the construction of the building which
is going to stay part of the building which will come into the
ownership of Government should be included but also that timber
which is used by the company which is constructing it and which
will remain in their ownershipand that was not covered
by a contractual requirement.
Q4 Mr Ainsworth: The contract was
signed in March 2002 but in March 2001 we have the Prime Minister
saying that we promised that as a Government we will only purchase
timber from legal and sustainable sources and it was a clear breach
of that promise, was it not?
Fiona Mactaggart: No, it was not.
All the timber which is purchased, which will end up in the ownership
of the Government in this development. So anything which was to
be used in the building itself has been subject to this a clear
clause, which said that not only should we make best efforts but
that it should happen. It was a very clear clause. There was timber
to be used by AGP, who are the developers, which will remain in
the ownership of AGP. For example, the hoardings, which belongs
to them, some of the stuff which had been used for shuttering,
for concrete and so on would continue to be in their ownership
and that has not been covered by that obligation.
Q5 Mr Ainsworth: It should have been,
should it not?
Fiona Mactaggart: It has become
clear since then through updates of Government policy that it
will be from now on, and indeed we have been talking very carefully
to the developers to ensure that that does happen but I do not
think it conflicts with what the Prime Minister said.
Q6 Mr Ainsworth: I think that is
something the Committee will take a view on, but could you actually
answer the first question I asked, when did the department first
become aware that there was a problem with this timber?
Ms Aldred: After the Green Peace
invasion of the site.
Q7 Mr Ainsworth: So it was after
a member of the public had walked past the site and seen a sign
up saying "Timber from Indonesia"? It just strikes me
that you are not particularly thorough. Given the importance of
this issue, the commitments which the Prime Minister has made,
the policy which has been instructed across Government to allow
this sort of thing to happen seems sloppy.
Fiona Mactaggart: We have a very
robust monitoring arrangement on those parts of the contract where
we had a contractual obligation and if the timber which had been
purchased for the building itself had had that it would not have
been possible for it to have that provision; that is very strongly
monitored. You are quite right that this part of the contract
was not monitored and that is a flaw and it is a flaw which has
been recognised and we have been working with DEFRA to ensure
since this episode that purchases which are made by AGP or sub-contractors
which will remain in their ownership will in future be monitored,
but until this point we did not believe we had and we did not
contractually have a responsibility to monitor it.
Q8 Mr Ainsworth: You did not have
a contractual responsibility?
Fiona Mactaggart: No, we did not.
Q9 Mr Ainsworth: Were the model contract
on sustainable procurement and the timber procurement guidelines,
which are set out in the Green Buyer's Guide, applied when you
awarded the original contract?
Fiona Mactaggart: Yes, they were.
Q10 Mr Ainsworth: It is simply that
those provisions were not applied to parts of the contract where
you were not going to end up owning the timber?
Ms Aldred: They did not explicitly
make it clear that timber that was going to remain in the ownership
of the contractor should be covered.
Q11 Mr Ainsworth: Was that a problem
with the Green Buyer's Guide or was it a problem specific to this
particular contract?
Fiona Mactaggart: It is a problem
across Government and I have been in correspondence since this
episode with the Minister in DEFRA to highlight how our experience
has revealed the need for more explicit guidance to Government
departments that where timber is not to be purchased for the departments
or for Government but might be purchased by a developer to use
in the process of delivering their obligations that there needs
to be more explicit guidance about how to do that, and there will
be. They have recognised that and I have had a response from them
precisely about that point.
Chairman: We will break for the vote
and if you could all come back as soon as possible, please.
Committee suspended from 4.00 pm until
4.10 pm for a division in the House
Q12 Mr Barker: Minister, I listened
very carefully to the very precise replies that you gave to Mr
Ainsworth's questions and it would appear from your answers that
technically the contract was upheld but would you not agree that
while the contractor may not have breached any specific clause
within the contract there has been a massive breach in the spirit
of the contract?
Fiona Mactaggart: You have paid
me the compliment of saying my replies were very precise and this
is my first experience in this role and I am not sure that they
always have been. For example, I might have allowed the impression
that I accepted that the timber that was used was illegally imported
to rest and actually it was legally imported; the question is
what its source was. We do have a certification of legal importation.
The question isand it is a serious question and I think
the Committee is right to focus on this questionabout the
provenance of the timber. I do not think that this is a question
of breaking the spirit of the contract. I have gained a very clear
impression that AGP as the developers in this PFI are determined
to demonstrate best practice as far as is possible. Indeed, for
example, before this episode that we talked about AGP on their
own initiative had made a trial purchase of plywood from Finland
which is coming in from forests which are certificated under a
European sustainability certificate in reflection of the fact
that they want to do work which is to the best standards and to
find new supply chains which can enable them to do that. So I
do not think that this is an example of an attempt to hide behind
the letter of the law. There really was genuinely a belief that
this matter was not covered by it and that it might help the company
to find new sources of supply, to improve its purchasing because
they recognise that Government, who is their client in this particular
contract (and I believe they would hope might be the client in
other contracts), would expect that kind of thing and were looking
at ways of getting good value timber which met the high specifications
which would be in that part of the contract which we had not included
but which in future we will; that timber which was for their own
purposes in order to fulfil the contract, not timber which would
end up in our ownership or in the building itself.
Q13 Mr Barker: So they fully understood
what the objective of the contract is?
Fiona Mactaggart: Absolutely.
Q14 Mr Barker: And then knowingly
and willingly imported timber that they knew to come from unsustainable
sources?
Fiona Mactaggart: I do not think
that is fair at all. They have not been able fully to trace the
timber which came from Indonesia.
Q15 Mr Barker: Is that not the point?
Fiona Mactaggart: Exactly, it
is the point and it is an important point and it was about a third
of the timber purchasing for their own purposes. But I think we
all have to recognise that we have been going through a process
of massively improving the awareness within the construction industry
of the issue of sustainable logging. If we go back to the time,
for example, that this contract was let we were not at the point
where we are now. If we go back to the point at which it was signed
we are not at the point where we are now. It is a process of change
and I do not think it is fair to imply that there is a cynical
disregard of the ambitions of the Government in doing this. What
happened reflects the state of play within the industry at present.
This building is going to be an important landmark. It is going
to be in many respects at the cutting edge of good practice in
terms of its purchasing policies, in terms of its impact on the
environment and so on and I think that what the company was doing
was to try to go beyond what it thought were the requirements
of the contract, beyond the requirements that we had put into
the contract. We are also now looking at going beyond that and
have an agreement with them now that any future purchases which
they will make for their own use, although this is not required
in the contract that we signed with them, will be from sustainable
sources which we can monitor in exactly the way that is written
into the contract for timber which is going to be used in our
building.
Q16 Mr Barker: I must say I find
it very difficult to make the leap of intellect that says that
they were trying to go the extra mile and went the extra mile
by sourcing illegally logged timber. I simply cannot join that
up despite your very long explanation.
Fiona Mactaggart: I am sorry,
they continued their normal purchasing practices.
Q17 Mr Barker: You said they were
going the extra mile.
Fiona Mactaggart: No, what I am
saying is they continued their normal purchasing practices for
about half of the timber which they used, in fact for all of the
timber that they used, but some of that purchasing we did not
have any mechanism to monitor because it was not in the contract
and we did not seek to monitor it.
Q18 Mr Barker: But you can ask them
when you are tendering, "Where does your timber come from?"
You do not have to have a contract to do that, do you, just when
you are talking to the developers? That is what your job must
be, Mr Edwards?
Mr Edwards: Indeed. What the Minister
is trying to get across, I think, is that we were not asking that
question in respect of the timber used in the construction process.
Q19 Mr Barker: So you did not have
an overall sustainable approach, you just focussed on certain
narrow areas and did not actually have a macro view on the whole
thing?
Mr Edwards: We were discussing
it in general terms but we were not asking them precisely where
the wood came from and what was going on precisely.
Ms Aldred: Could I just clarify
one point? I think that we are very concerned about this issue
but I think the suggestion that we know that this is illegally
sourced timber is one that we do not have an answer to at the
moment and I think that is quite important. The timber was legally
imported. It was purchased by the contractor. They have not been
able to provide, as they have undertaken to do, the certificates
of provenance in the time that we have had but I think that certainly
it has not been demonstrated conclusively that this is illegally
logged timber and that is something I think we do need to take
account of. It is not illegal to buy timber from Indonesia.
1 See the Committee's Sixth Report of Session
2001-02: Buying Time for Forests: Timber Trade and Public Procurement,
HC 792. Back
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