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20 Jul 2005 : Column 489WH—continued
Department for International Development (Mr. Howard Horsley)
3.59 pm
Mr. Austin Mitchell (Great Grimsby) (Lab): I secured this debate on Howard Horsley, whom the Department for International Development has treated badly, because he is a friend and for many years was the head teacher of a tough school in Grimsby, at which he gave distinguished service. He is also an idealist who is passionately concerned about international development. Indeed, he has done aid work in Africa and the West Indies.
When the incoming Labour Government expanded the aid programme, Howard gave up his teaching career to become the head of the largest British educational aid programme ever initiated in Ghana. His reward has been to be treated abominably by DFID. The problem was that he blew the whistle by drawing the attention of the Department in London to the programme's lax budgetary and other financial controls, which Ghanaian and foreign aid agencies in Ghana had drawn to his attention and which could give rise to corruption in purchasing, for instance, Land Rovers and computers.
Howard expressed his concerns in London to the then head of the Ghana desk, who told him that she shared many of them and that they would be addressed. The issue should have been treated as whistleblowing on malpractices under the Public Interest Disclosure Act 1998; instead, however, Howard was fired after he had just recovered from typhoid at home and was about to return to Ghana. No dissatisfaction with Howard had been expressed before, and none of DFID's disciplinary procedures, as set out in its 1999 documents on safeguards—hearings, the right to produce evidence, the right of appeal and the need for advance warnings—was applied.
Howard asked to return to Ghana to prepare his defence. He was told that he could, and should, do so and that his files would be protected. He arrived back in Ghana to find that his computer files had been expertly wiped and all his physical files had vanished on the instruction of a senior DFID official. He was told to return home immediately, and that he must not talk about the events to people such as me, his former MP, because the Official Secrets Act applied and sanctions would be exercised if he did.
On his return, Howard took up the issue with Sir John Vereker, the then permanent head of DFID, who said that an internal inquiry would be initiated. Only when those internal procedures had yielded nothing and he had exhausted internal remedies, of which there were few enough, did he refer the matter to a tribunal. At the tribunal, he was given no access to papers or to the accusations. The tribunal gave directions on disclosure that were not fully fulfilled, and the Treasury solicitor made inaccurate claims that Howard had been warned that the Official Secrets Act would apply and that all relevant documents had been disclosed.
Lord Goldsmith is an honourable man, but the claims were wrong. When Howard and I met him, he agreed that the claims were wrong, but said that they had been made in good faith on behalf of DFID, and that there was no obligation on the Treasury solicitor to check the
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accuracy of claims made by the client. However, the court was in effect misled, and it refused jurisdiction on the issue.
Only when the National Audit Office began to inquire were the disclosures required by the tribunal given to Howard, by which time the tribunal hearing had finished. Again, they were honourable men, and it was said that there had been a misunderstanding.
At this point, I became involved to try to help Howard, whom I regard as a man of idealism and good faith. I found that other means of redress had started to fail. First, Sir John Vereker, the permanent secretary, who is an honourable man, had said that a full internal inquiry had been initiated and carried out, but he seems to have been wrong. We learned from later correspondence that no inquiry had been initiated or requested. The ombudsman, with whom I took up the matter, has no jurisdiction on matters of employment. The data protection people's writ does not operate outside the UK; the events took place in Ghana.
I took the matter to Baroness Prashar, the senior civil service commissioner, who was receptive, responsive and helpful, but she told me that there had been confusion over the capacity in which Howard Horsley had been employed. He was not a civil servant, although the post was advertised as a civil service job and he was interviewed as such. Had it been a civil service job, he could not have been dismissed in such a fashion. Neither was he a technical co-operation officer, because that covers British officials seconded to foreign Governments to handle British aid programmes. He was working not in that capacity but directly for DFID. Had he been a technical co-operation officer, he would have been better protected and would have had more rights against dismissal.
Baroness Prashar said that he was employed under the royal prerogative, which is a rather mysterious category of employment. She explained that it was rather like the secret service. That had me baffled, because it meant that he had no protection. However, Baroness Prashar wrote to the Cabinet Secretary saying that such people should have their position recognised and regularised. I am grateful to her for doing that. Provisions for regularisation of such posts were put into force in DFID when the posts were all transferred to civil service staff in 2002.
I wrote to the Cabinet Secretary as head of the civil service and therefore, presumably, the protector of somebody treated in such a fashion, asking for an inquiry and asking him to meet Howard and me after we had trailed around all those other bodies trying to get them to intervene. He declined to initiate an inquiry and declined to meet us. He told us that there had already been a full inquiry; that was not true, but, of course, the Cabinet Secretary is an honourable man.
I also went to Sir John Bourn at the National Audit Office; he was very helpful. He considered the issue, and officers were sent out to Ghana to look at what had happened there. He found that the financial controls in DFID in this country were lax and that similar laxities applied in Ghana. He said that that should be put right. He agreed that, in view of the laxity of the controls, corruption was possible, but he did not find any. He did not, it is fair to say, speak to any of the other foreign aid agencies operating in Ghana, which might have told him a different story.
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At first, Sir John found that Mr. Horsley's predecessor had not complained. He later corrected that when we demonstrated that Mr. Horsley's predecessor had complained about the same issues and that at the end of his period of service his contract was not renewed and he was out of a job. That was corrected in the NAO report.
Sir John also found no reference to, or record of, the payment of £18 million that Mr. Horsley complained about. I want to digress at this point. Apparently, when the Chancellor sold part of the gold stocks, the gold price fell, producing severe difficulties for Ghana and its agricultural exports. That was discussed in a meeting in London with the then Secretary of State for International Development, at which the Ghanaian deputy Education Minister was present, and the Department considered making a payment to help the Ghanaians. The Ghanaian Education Minister was in London at the time but was not called to the meeting. Howard Horsley and the overseas aid community in Ghana knew that there would be a payment to help them in that situation.
On 23 September 1999, Mr. Horsley was called to a meeting with the Ghanaian equivalent of the Comptroller and Auditor General. He went with a representative of the British high commission, a Mr. Stuart, and was told that £18 million had arrived and it would shortly release money for educational purposes in Ghana, where he was working at the time. Many people knew of this but the NAO went through the ledgers of payments overseas by the Treasury, the Overseas Development Administration and other agencies and could find no trace of the payment.
Sir John Bourn, the Comptroller and Auditor General, wrote to me to say that the British embassy official, Ian Stuart,
"has confirmed to my staff that he was present at the talks, and that the then Secretary of State (Ms Clare Short) lent a sympathetic ear to the Ghanaians regarding the fall in the gold price, and the price of agricultural commodities such as cocoa and coffee. He added, however, that he was 'absolutely sure' that there was no rapid disbursement of funds to Ghana following the talks."
That is a very equivocal statement. The NAO was not able to enlarge on it for us. What does it mean? No rapid disbursement of funds does not mean that there was no disbursement of funds. It presumably means that there was no immediate disbursement of funds. That was the statement. This issue of why the £18 million was paid and what happened to it is very mysterious. I put it no stronger than this, but it may account for the way that Howard Horsley was being treated by the British Government and why there was so little response to his points.
Indeed, as a result of the NAO report, a document entitled "A Review of Safeguards Against Misappropriation and Diversion of Aid" was issued. It states:
That is what Howard Horsley tried to do. The document continues:
There is a direct endorsement of what Howard Horsley was saying, which had been ignored by DFID. At least something resulted from our interviews and the work of Sir John Bourn and the NAO.
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This has been for me a sad and deeply frustrating experience because we have gone round from one body that is there to help redress grievances and to see that the rules are observed to another. We have received a little help from all—substantial help from the NAO—but no resolution of the basic issue of why Howard Horsley was treated in this disgraceful fashion and fired from a job to which he had committed himself through idealistic motives.
We have been batted around like two shuttlecocks, almost going round to all these bodies holding hands. Everyone knew that it was an issue of concern. Everyone had some information to offer and a little help, but nobody could resolve the major issue. In the end they have all put up the shutters, which is why I am here today raising this issue. If nothing can be done, details of the abominable situation that has been allowed by DFID to arise in the face of a manifest injustice should at least be put on the record.
I should add that as a final piece of vindictiveness Howard Horsley was refused a reference by DFID. He was offered a senior, well-paid administration job in education. But a reference is needed before that can be finalised. DFID at that point, despite my pleas, refused him a reference. He has not worked since. He is now 60 and he has not worked because of this disgraceful treatment over all these years.
First, there is a need to strengthen the whistleblowing protections under the Public Interest Disclosure Act and to stop using the Official Secrets Act to avoid embarrassment to Departments. Most of all, DFID needs to do justice to this man over this case. There should either be an independent inquiry into the matter, or—I would prefer this—Howard Horsley should be reinstated in the job in which he was doing such good work, and to which he was so committed. Had he been a technical co-operation officer employed by a foreign Government to attend to the disbursement of British aid, the good governance requirements that DFID imposes on foreign Governments who work in that capacity would have prevented his being treated in this way. A foreign Government would not have been allowed to treat him as DFID has. Had they done so, there would have been a cut-off of aid. DFID should observe the standards that it preaches to other Governments. Instead of rewarding Mr. Horsley's manifest commitment and idealism, it treated him in a disgraceful fashion, and that should not have been allowed. It is never too late to do justice.
4.16 pm
The Parliamentary Under-Secretary of State for International Development (Mr. Gareth Thomas) : As is traditional, I start by congratulating my hon. Friend the Member for Great Grimsby (Mr. Mitchell) on securing the debate, although I recognise that it will bring him no joy. It certainly brings none to me, or, I am sure, to those who watch or read the proceedings.
I welcome the opportunity to clarify the record regarding Department for International Development management practices at what is a hugely important time for development and for aid generally. I shall address Mr. Howard Horsley's dismissal, but first I shall make some general remarks about the Department's management practices and touch on the issue of Ghana.
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Earlier this month, at Gleneagles, the G8 countries made an historic agreement. They agreed a comprehensive package of measures to accelerate development in Africa and the developing world. Because of that agreement, Africa can make faster progress toward achieving its millennium development goals. The package is a momentous and important result for Africa, the UK and the international community. Inevitably, it gives DFID a great opportunity and a great challenge, and I am confident that it will meet that challenge.
It is important to point out that others share my confidence in DFID. In January, the Prime Minister said that it is
"probably the most respected such Department in the world."—[Official Report, 12 January 2005; Vol. 429, c. 295.]
Praise for the Department has come from a range of other sources. The Canadian Institute of International Affairs recently said that DFID is generally considered to be the best development agency in the world. In 2003, a BBC "Westminster Hour" survey panel that included a former Minister, lords, MPs, former civil servants and journalists rated it as the top-performing UK Government Department. Therefore, I have reason to be proud of DFID's performance. If one is proud of one's Department's performance, one must inevitably be proud of the way in which it is managed.
I turn to some specifics about DFID's management practices. In all our work we stress the importance of sound management, which must start with a clear focus. Our public service agreement sets out that focus. The agreement is centred around achieving the ambitious and internationally agreed millennium development goals, but it essentially has one aim, which is reconfirmed in the International Development Act 2002: to work towards the elimination of poverty in poorer countries.
In mid-2004, following direction from Ministers, our management board set out a programme for the next three years that highlighted delivery and performance against that single, overarching aim. Part of the agenda was a wide-ranging efficiency programme. We believe that gains worth £400 million can be achieved in the period 2005–06 to 2007–08. We monitor our efficiency gains as part of our effort to monitor and report on our performance. Like all Departments, we publish progress against our public service agreement twice a year and we report publicly on our website.
The public service agreement includes a value-for-money objective, which includes the aim to increase the proportion of our bilateral programme excluding humanitarian assistance to low-income countries from 78 per cent. to 90 per cent. in the current financial year. The Department knows that it can enhance its performance through collaborative working, so of course we join our efforts to those of other Departments, not least the Foreign and Commonwealth Office and the Ministry of Defence on conflict prevention.
We have a range of sound management practices that protect that value-for-money objective. They include a system of internal control that has been commended by the National Audit Office, annual statements of assurance from each of nine divisional directors, a very
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active internal audit function and a thorough approach to risk management. In 2004, we also launched further anti-fraud, anti-corruption measures, seeking further to adopt a zero-tolerance stance.
Our sound management practice does not stop at financial issues. In the end, the Department's achievements are about the achievements of our staff and ensuring that their unfailing energy, skill and determination is maintained. That is why this year we launched a major new programme further to improve people management, our approach to which embraces constant efforts on diversity. Those in turn have been bolstered by the launch in 2004 of the "Diversity Vision and Strategic Priorities" paper, senior managers being responsible for delivery against the priorities identified. In summary, we have a range of management practices that ensure strong performance and delivery against our poverty elimination aim.
I shall mention our work in Ghana, a country where Mr. Horsley worked. As hon. Members know, Ghana is a very poor country; more than a third of its population, about 7 million people, live on less than a dollar a day. In Ghana, my Department spends about £70 million a year. The programme is firmly targeted on the poor and on creating the conditions for economic growth. The country has a thriving democracy and a reputation for using aid well. Our programme has succeeded in helping Ghana to bring down poverty by about 10 percentage points since the 1990s. Poverty has reduced to about 37 per cent. of the population today, putting Ghana on track to reach the income poverty millennium development goal by 2015. It is one of the few countries in Africa that is on track to do so.
Our support for Ghana's progress on poverty would not be possible without sound management in the DFID Ghana office. Our internal audit department carried out a further health check of that office in February 2003, judging its management systems to be robust. My hon. Friend may be interested to know that the National Audit Office is expected to visit DFID Ghana again in December further to review our management systems and practices in that office. I will welcome what it has to say.
On people management, DFID Ghana was inspected in 2003 as part of our Investors in People accreditation process. An independent assessor interviewed all 45 staff in Accra and rated DFID Ghana's management environment as good.
I shall refer to the specifics of the case that my hon. Friend raised—the dismissal of Mr. Howard Horsley. My hon. Friend will understand that I cannot breach confidences about Mr. Horsley's personal information and employment in this setting, but I can confirm some key facts about the case. The Department employed Mr. Horsley from May 1999 to January 2000. He was dismissed on 6 January 2000 on performance grounds. Since then, my hon. Friend has written some 17 letters to the Department about Mr. Horsley's case. Two DFID Secretaries of State, two DFID permanent secretaries and two Cabinet Secretaries have considered the matter. Mr. Horsley commenced employment tribunal proceedings in April 2000. The litigation ended following a number of hearings in November 2003, and Mr. Horsley was not successful. The NAO has investigated my hon. Friend's concerns about financial practices in the DFID Ghana office and found no
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evidence of impropriety. There has also been a series of DFID internal, civil service commissioner and Attorney-General investigations and reviews since the dismissal, which my hon. Friend alluded to. My Department estimates that its costs for investigating and reviewing the case now exceed some £40,000. I recognise that my hon. Friend's constituent has also had huge costs.
Mr. Mitchell : Those costs, of course, would not have arisen had Howard Horsley not been so badly treated, and had the requests not been refused. I am delighted to hear of all the improvements that have been put in place since this case, but they are all subsequent to it. According to the memorandum, the procedures for dealing with staff problems in the Department apply to all employees of DFID, so why was Mr. Horsley not accorded the same procedures, rights of appeal, including internal appeal, and right of internal warning, that the procedures set out?
Mr. Thomas : I recognise that my hon. Friend will not like my answer, but I return to the point that I just made. The case has been considered by two Secretaries of State, two permanent secretaries in the Department, and two Cabinet Secretaries, as well as the employment tribunal. Mr. Horsley has not persuaded those individuals and the tribunal of the merits of the case.
Mr. Mitchell : Of course the matter has been considered by two Secretaries of State, because I kept on raising it. However, one of them was told by Department officials that Mr. Horsley was litigious and that therefore no information should be given. I come back to the point that all this trouble would not have been necessary had proper procedures been followed.
Mr. Thomas : I hear my hon. Friend's point. The advice that he says was given to previous Secretaries of State does not mean that the case has not been extensively and thoroughly investigated. I recognise that my hon. Friend has a different view of the outcome, but I repeat that the case has been thoroughly investigated.
Following the various tribunal proceedings, investigations and reviews that have taken place, the Department strongly believes that no outstanding issues remain to be dealt with. I recognise that that will disappoint my hon. Friend's friend, and, indeed, my hon. Friend himself.
My right hon. Friend the Secretary of State wrote to Mr. Horsley in May 2004 and said that he did not see then how the matter could be taken any further. The Department considered the matter closed then, and I believe that it is closed now. I recognise that that is not the answer that my hon. Friend wanted, but it is an accurate picture.
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