Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses(Questions 20-39)



Jon Trickett

  20. I wonder if I can go straight to table 16, paragraph 5.31, which I think is illustrative of the problem. Can I just ask because these figures are for March 31 2001, we are now well into 2002, whether you now have the estimates, the figures, for the last year?
  (Mr Broadbent) For the year we have just finished, that finished 29 days ago, I do not have full sets of figures.

  21. You will have estimates though presumably.
  (Mr Broadbent) We have data coming in. If we take a lot of the things we do, seizures, for example, take place all over the world, so I do not have a full set of figures. Calculating the impact of any given set of indicators on what is the key point, which is the outcome target, is even more complex because you have to calculate market shares, you need sales data. To get to a judgment about whether we have achieved an outcome is something that is going to take us several months. Over the next few months we will have more and more data on the various activities that we undertake which has to be brought together with analysis of the market to produce the outcome judgment.

  22. So what you are really saying is you are plaiting fog?
  (Mr Broadbent) I am sorry?

  23. You are plaiting fog rather than managing a process.
  (Mr Broadbent) No, we are managing a process.

  Jon Trickett: It sounds like you are plaiting fog if you do not know—

  Chairman: I am sorry, what did you say, Mr Trickett, I did not hear?

  Jon Trickett: Plaiting fog. It is a Yorkshire expression.

  Chairman: We are speaking English here!

  24. I will translate it for your benefit, Chairman. What I mean to say is that there is no management information then upon which you can measures your attainments?
  (Mr Broadbent) We have management information. At this stage of the year it is by no means complete because the year ended only a number of days ago and we are covering a very, very large number of indicators. The point I was trying to make is the important judgment, which I thought you asked me about, is are we achieving our goal, which is to reduce tobacco smuggling, which is the target that we have been set. To get to that judgment we make an assessment of probably 40 or 50 indicators and that information will flow in.

  25. Have you seized more cigarettes or less?
  (Mr Broadbent) In the last year?

  26. Yes.
  (Mr Broadbent) The current indication is we have probably seized about the same.

  27. Has consumption increased or decreased?
  (Mr Broadbent) We do not know yet. I am afraid if we go through a list of many different indicators it would not be surprising in something as complex as this if we found that some had gone up, some had gone down, some we have not got at all yet because we do not have sales data, for example, and consumption data until later in the year when the Household Survey comes out later in the year. The point I would like to make because I am not plaiting fog, I hope, if I can borrow your expression, is if I was making a judgment today, now, which I will try and do in a sense to be helpful, on the basis of the information that I have now, which as I say is disparate, of different time periods coming in and some I lack altogether, I would say that I am reasonably confident that we have built on the success we had last year and that we are moving towards stabilising this market. I could not tell you now whether we are going to be actually on the dot but I am confident that we are going to be there or thereabouts.

  28. I seem to think you indicated to the Chairman that you have increased the number of scanners, admittedly at some funny parts of the year, and yet you have only seized approximately the same number of cigarettes. It does seem to me that the key to all of this is not so much the technology which this paper would have us focus our minds on, rather the intelligence which indicates where we ought to be. Intelligence, it seems to me, is another way of saying management information and yet the management information is singularly missing, is it not?
  (Mr Broadbent) I agree with the importance of management information, if I may say so, but intelligence is an absolutely critical tool and it is not just management information. For example, in the past year we have invested £11 million in bringing together a national co-ordination unit which is designed to sort data, which is not internal management data but it is things like Customs hotline data, information from overseas agencies. We have increased our tasking of covert sources. We have a range of intelligence activities. If you measure our intelligence output it has gone up, you can measure that, but it has not gone up, for example, as much as our examination rate has gone up.

  29. Let me try something different then but on the same theme of management information. What proportion do you think of the scans which you conduct are random and what proportion are directed by intelligence towards particular operators or vehicles, as an approximate figure?
  (Mr Broadbent) We conduct effectively no scans at random but we can think broadly in terms of two streams of intelligence. One is very specific intelligence which has been developed through target operations, through covert means, through information received, and that set of intelligence is often down to say "we will stop that lorry" through to "watch for something on this shipment". That is one set of intelligence. Another set of intelligence which essentially is analytic will look at, for example, patterns of data, is the load commercial, how is it paid for, you can analyse. In broad terms we try never to make random stops because they are almost wholly ineffective but there is intelligence at different levels and quality that guides us.

  30. I understand. I think you said there were 150,000 scans last year, ish?
  (Mr Broadbent) Yes, ish.[2]

  31. How many of those as a percentage produce a successful hit in the sense of identifying contraband do you think?
  (Mr Broadbent) Again, I am afraid it is very difficult to generalise because most of those scanners were not in use for a full year and I have to be very clear, and I have no problem saying this, we are still learning how to make the best use of scanner technology. If I take a port like Dover, for example, we are looking at a hit rate of between 2 and 3%.

  32. You might say that your intelligence is not yet finally refined if all of those scans were based on intelligence but only—
  (Mr Broadbent) If I took detections based on what I might call specific intelligence, that is the first sort that I mentioned to you, the hit rate is 56%. The issue for us on intelligence is maintaining the quality and increasing the volume. It is actually relatively easier to increase your examinations, you can put people on a dock and stop the lorries. Creating intelligence is actually the critical intellectual task, and that is much more difficult to do.

  33. Probably then you have hit on about 4,500 contraband loads.
  (Mr Broadbent) I am sorry?

  34. I think you have hit on about 4,500 contraband loads then.
  (Mr Broadbent) In Dover?

  35. Yes. Not in Dover. You said 3% of the scans approximately produced successful hits.
  (Mr Broadbent) I was taking Dover as an example. It is difficult to produce a national figure because, as I say, not every port has a scanner and in most ports the scanner has only been there for a period of months. I instanced Dover because it is a large port and the scanner has been there for a full 12 months.

  36. I want to move on, but still within the same theme of intelligence and management information and so on. One of the problems was so-called methodological inconsistencies in the data used to measure market penetration. Can you tell us more about that, please? This is 5.29.
  (Mr Broadbent) This goes to some of the complexity of developing outcome targets. One of the things we need to know in determining whether we are achieving our outcome is consumption of tobacco. We use several sources for consumption of tobacco, including the General Household Survey, the Omnibus Survey, and one of the things that we have discovered as we go through our data, which we do regularly, is that there is a technical inconsistency between the way in which the General Household Survey and Omnibus Survey describe smokers between packet smoking and tobacco smoking and we are ironing that out. I think there are going to be a number of these sorts of revisions, the revision is not material. The development and the measurement of outcome targets, which as I say is completely new, involves us in going back over the ground again and again to try to improve the accuracy of the target. Can I just say one thing, I do not want to mislead you. I believe the figure of 2-3% I gave you in relation to the number of detections at Dover was all detections, not just from those that have been through the scanner. I am sorry, I would not want to get that wrong.

  37. This Report would have us focus on scanners, I think, and I think it is a conjuring act. I personally think you would prefer us to look at scanners and maybe you think the Committee are interested in technology and so on, but I rather think that the focus of attention on tobacco smuggling ought to be on intelligence and so on. I just want to turn to the C&AG because I note Section 2 of the 1921 Act requires him to satisfy himself about the adequacy of procedures and so on and so forth. Do you feel that the methodologies which Customs are using to measure themselves after all, which we have just heard about, are sufficiently robust actually to determine whether or not the 21% figure is accurate in any way?
  (Sir John Bourn) Mr Trickett, you say "accurate in any way", within that context the answer would be yes but I recognise the difficulty that is faced in developing the methodology. That is really one of the basic reasons why I bring it to the Committee's attention.

  38. I think you are required to judge yourself—
  (Sir John Bourn) Yes.

  39. Whether or not you think this methodology, which was inconsistent at one stage, is now robust. I am asking you, and I will try to use as few words as possible so you cannot hang your answer on one of my words, whether or not you feel that this methodology is now robust?
  (Sir John Bourn) It is more robust than it was but there is still scope for improvement.

2   Note by witness: 155,000 challenges, of which 70,000 were scanned. Back

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