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Mr. Redwood: I welcome the principle of a more streamlined audit in Wales, and welcome the idea behind the Bill that the Auditor General for Wales should be concerned about efficiency, effectiveness and economy—about value for money—as well as about regularity and ensuring high standards of accountancy throughout the Principality. I do not wish to be the party pooper tonight, given that there is much consensus between the major parties, but on Third Reading we should ask ourselves a basic question. Is it likely that the Auditor General, charged with the powers in the Bill—on the likely assumption that it goes through in its current form—will succeed in rooting out the waste and inefficiency that we know exists throughout government in Wales at all levels?
We have been told by no less an authority than the Chancellor of the Exchequer of the United Kingdom—on this occasion, he has probably underestimated the situation, but he is giving us a general truth—that there is more than £21 billion of waste throughout UK government as a whole. Tonight, we are interested in only the Welsh portion of that figure. According to a rough calculation, one would assume about £1 billion-plus of waste in government in Wales. If we allow for the fact that some of that waste will be accounted for by the UK Government's doing "Union things" in Wales, we probably arrive at a rough figure of about £500 million of waste and unnecessary expenditure—the Chancellor must have that figure in mind—in the devolved areas and local authorities, which the Auditor General should root out as his main task. The Minister is welcome to intervene if he has a more precise figure. I see that he is with me so far, because he is not seeking to intervene or to deny what I am saying.
In his review, the Chancellor has greatly underestimated the extent of wasteful and unnecessary expenditure and flattered the public sector's efficiency and effectiveness; but better the sinner who repenteth a bit than the sinner who does not recognise that he is sinning at all. I am happy to start off by rooting out some £1 billion of wasteful expenditure in Wales, and I want an Auditor General who is capable of getting to grips immediately with the £500 million, which must be the devolved Welsh portion of the Chancellor's own figures.
So how is the Bill going to help? We are told that the Auditor General will carry out studies to assess the economy, efficiency and effectiveness of various policies and institutions. The Minister has told us—I am sure that he is right—that the Auditor General will be fearless and independent. He will know that it is his job to root out all such problems in turn as he decides to
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study them, and then to lay measures before the Assembly so that it can see for itself just how bad things might be.
That, Madam Deputy Speaker, is where I wonder whether the Bill is strong enough to deal with the extent of the waste already identified by the Chancellor. My worry is that worthy work will be done in the first year or two—all sorts of studies will be commissioned and much money spent on investigating and assembling figures, listening to what witnesses have to say and so forth—but the end result will not challenge the underlying problem, which is a top-heavy bureaucratic structure. I fear that we will not hear that there could be much cheaper and easier ways of achieving things if policies were changed. It is difficult for an auditor, who is used to checking, reviewing and ensuring that numbers are accurate in his professional career, to move into the much more dynamic task of asking the big questions: is the money wisely spent; is the policy achieving its objectives; are there other ways in which an administration could achieve its objective? Much of what is assessed will be deeply political territory.
What if the efficiency review reveals that a wholesale transfer of functions from the public to the private sector is the best way of lowering costs and improving the quality of the service? That would be very difficult in the Welsh context, given the political composition of those to whom the Auditor General would be reporting. What if the efficiency and effectiveness review revealed that a large number of public servants—over and above the 104,000 UK-wide losses so far identified by the Chancellor—would have to go? To the best of my knowledge, we have not yet had a breakdown of what the overall figures mean for Wales. That, too, could be extremely sensitive territory, but it is impossible for the Auditor General to do the job as described in the Bill's remit unless he or she gets into that sensitive territory and starts considering whether all the public sector workers in Wales have a worthwhile job that is being carried out in a way that delivers value for the Welsh taxpayer.
I am suspicious of the function to review best value. I think that "best value" is one of those gross misnomers. A best-value regime has, in many cases, become a way of avoiding giving real value for the taxpayer and has generated a huge bureaucracy on top of what would otherwise be relatively sensible services. I do not believe that this particular philosophy in this Bill will cut through or dismiss best value because the Auditor General is invited by the Bill's language to go along with the best-value regime—a trumped-up method introduced by the Labour Government to avoid proper competitive tendering and contracting out. That is a fundamental flaw in the Bill, reflecting the flaw in the underlying policy that it is trying to review.
I am also very concerned about a point raised by my hon. Friend the Member for Leominster (Mr. Wiggin). He was, perhaps characteristically, a little too generous to the Government in making his criticism and passing over it. The question is—have the Government got the balance right in the Bill for protecting the whistleblower? My hon. Friend has done some good hard work with colleagues in Committee to get across the need to protect the whistleblower. I am sure that the Government have moved some way and I am grateful that they have seen the point.
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Although it is important to protect the whistleblower against some of the more extreme penalties and results that could occur, it is very difficult—it is not dealt with properly in the Bill—to protect a whistleblower from loss of promotion prospects or from a difficult working environment if they wish to carry on working in the same public body. The Auditor General can make progress only if there are honest whistleblowers in the different public institutions and levels of public administration in Wales who are prepared to come forward and say how scandalous it was that so much money was spent on this and that, or that money has not been spent with great economy or good purpose.
I am sure that some people in Welsh public services have a high-minded belief in providing value for taxpayers and would love to tell their stories tonight, especially if they resulted in improved performance. However, they will not do so because they know that their working arrangements would become very difficult and that some of their colleagues who found the ineffective and uneconomic practices convenient would obviously dislike it very much if they had the whistle blown on them.
Mr. Wiggin: I am most grateful to my right hon. Friend for mentioning whistleblowers. I completely agree with his point about protecting them not only from imprisonment, but further if possible. As I am sure he is aware, the Minister once introduced a Bill to protect whistleblowers, which is why we have been able to deal constructively with this Bill. However, my right hon. Friend is probably thinking—perhaps he would like to comment—about James Cameron, a whistleblower who was treated very cruelly by the Government when he revealed the scandal of Romanian people coming to this country when they should not—
Madam Deputy Speaker (Sylvia Heal): Order. We really ought to be discussing the Third Reading of the Bill.
Mr. Redwood: I am grateful for your sage advice, Madame Deputy Speaker. It is better not to get involved in individual cases outside Wales, although the general point affects Wales materially. I am glad that the Minister has some sympathy for the drift of my remarks, which is that I want more protection—I hope that the Minister will think about this when he legislates again—to be offered to those whistleblowers who are good public servants, who feel strongly about the public sector ethos and the need to provide a good service and who need to criticise one, two or three of their senior colleagues to make their point, but who are still deterred from doing that by the likelihood of the retaliatory action that can be taken in the public service.
If the Auditor General is to succeed, he or she must create an ethos that enables people in the public services in Wales to understand the essential need to spend public money wisely and to run things efficiently. It must enable them to see attempts to explain to those in positions of responsibility how money could be better spent and how things could be better managed as part of good management and good husbandry, rather than as whistleblowing.
That is one of the differences between parts of the public service and the private sector in Britain that is not entirely helpful to the public sector. In a good private
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sector company, a chairman or chief executive would introduce a suggestion scheme inviting employees, however lowly, to put forward ideas that would save an extra 1 or 2 per cent. on cost. People would co-operate in the right spirit, and middle managers would not feel resentful because they would know that they were all engaged in a dreadful struggle to keep the business competitive.
There is not the same sense in the public sector. There is much more resentment if someone junior tells people above them that things could be so much more efficient or effective if only they were done differently. That can lead to recriminations, retaliation, unreasonable discrimination, failure to promote, sidelining and all the other things that some good public servants experience. It can be more difficult to get to the bottom of such matters, given public sector secrecy and confidentiality. So my second main point is that we really need better protection for whistleblowers if the provisions are to work.
In conclusion, I am not against good or streamlined audit. I agree with one thing the Liberal Democrats said: we must audit the auditor to ensure that the new arrangements are not only better, but cheaper. However, in the context of such streamlining, we might need to return to the provisions to strengthen the Auditor General's position so that he can protect whistleblowers better—a lot of his work will depend on that—and so that effectiveness, efficiency and economy studies can have some real bite. My fear is that, for all the good intentions, cross-party working and agreement that we have witnessed this evening—and, I understand, during the Bill's earlier stages—whoever is in government in two or three years' time will discover that the £500 million-plus a year of waste in Welsh public spending that the Auditor General should root out, and which has been identified in general terms by the Chancellor, is still going on. If so, our legislation will have failed.
9.3 pm
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