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Kitty Ussher (Burnley) (Lab): It is a pleasure to follow the hon. Member for Tunbridge Wells (Greg Clark). He has a consistently rigorous and persistent line of questioning in our Committee, which has proved extremely effective.
My hon. Friend the Member for Portsmouth, North (Sarah McCarthy-Fry) spoke of the need to control risk. Some might say that I flatter the hon. Member for Tunbridge Wells simply because he represents my parents-in-law in the beautiful village of Goudhurst. I am not sure what form the risk to me might take if I got on the wrong side of him, but I am sure that it would be substantial. Nevertheless, I assure him that my flattery is sincere. It is a pleasure to serve alongside him.
Many Members, notably the hon. Members for Somerton and Frome (Mr. Heath) and for South Norfolk (Mr. Bacon), discussed smart procurement and the need for Government to procure effectively. I assure them that help is at hand in the form of my ten-minute Bill. I hope that I may use this opportunity to advertise it, Mr. Deputy Speaker. It seeks to enshrine in law the requirement for Departments to procure 2.5 per cent. of their research budgets from smaller companies, thereby harnessing the best scientific brains to find new and innovative solutions to public procurement and policy questions. I am sure that that is what we in the PAC aspire to do.
Mr. Bacon: I am fascinated to learn that the hon. Lady is to present a ten-minute Bill. Might she find time during her 10 minutes to discuss the Clinger-Cohen Acts in the United States, which compel Government agencies there to publish in a statutory framework the gateways during the procurement of IT projects? Such a requirement would be very welcome in this country.
Mr. Deputy Speaker: Order. I do not think that on this occasion we should expose what might be the substance of the speech of the hon. Member for Burnley (Kitty Ussher) when her Bill is presented. I think that we should stick to the agenda before us.
Kitty Ussher: I will, of course, follow your advice, Mr. Deputy Speaker, and not ruin the suspense for—I am sure—many Members. I shall be making my speech the week after next.
Let me add my tribute to Sir John Bourn and all the staff at the National Audit Office, to the rigorous nature of their reports and to the support that they give our Committee, which is such an important part of our democratic structure. I also pay tribute to our Clerk, Nick, and his team, who have been so patient in explaining the Committee's procedures to new members like me. The same applies very much to the Chair, the
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hon. Member for Gainsborough (Mr. Leigh), and to the senior Labour Committee members—as well as the Conservative members—who have courteously taken the trouble to advise me on the way in which the Committee works and how to get the most out of it.
It is initially daunting to find oneself on a Committee that considers two new subjects each and every week—a far cry from the more traditional Select Committees, which shadow Departments and have the leisure of deciding on their own subjects and investigating them forensically and in depth over weeks or months. For us, the hard work and the forensic work are done by the National Audit Office. We are the mechanism through which it airs its work. Through it, we are able to hold Departments to account.
As a cross-party representative grouping of unwhipped Back Benchers, we are, I guess, the voice of the people, taking the evidence presented through the forensic skills of the NAO and asking the questions on behalf of ordinary British taxpayers, namely, are we getting value for money from the taxes we pay and, to use the phrase used by my hon. Friend the Member for Portsmouth, North, are we getting enough bang for our buck?
On the whole, I have been fairly impressed by the answers that we get. The Chairman of the Committee referred to our December report, which considered the cumulative conclusions to be drawn from the last 10 years of our Committee's work. He rightly explained the number of recommendations that we have been making, but the first paragraph of that report makes it crystal clear that Governments over the years have acted on most of our recommendations and in doing so have, in many cases, secured financial savings, improved the standard of public services and tackled the risks to successful delivery.
Most striking is the effect of the Gershon review, which in 2004 made recommendations that would deliver £20 billion of savings through better organisation and smarter procurement, and would release more resources for front-line public services. I know from my experience in a previous life as one of those dreaded special advisers the fear that would run through Departments at the thought of being hauled in front of the Public Accounts Committee. Accounting officers really feel the potential pressure of that, which is a good thing because it means that they will perform their duty more effectively.
I want to pick out an example in relation to a report that falls within the scope of the motion. It is extremely important and perhaps merits further work, and it follows the line of comment of my hon. Friend the Member for Dagenham (Jon Cruddas) in that it considers the spatial effect of Government policy. It is the 51st report, 2003–04 Session, which considers success in the regions, the impact of the Government's regional policy and, specifically, the operation of the regional development agencies, as well as the contribution that they could make to the success of Government policy throughout the country.
In 2004, when I was not a member, the Committee concluded:
"Current RDA targets concentrate too much on short-term contributions to Whitehall objectives and too little on longer-term regional economic impact."
That was true at that time. There was a tendency for all Departments, when wondering how to implement their policies, to instruct the RDAs—certainly in the English regions—to implement an aspect of Government policy, with the result that the RDAs had myriad targets and no real mechanism to prioritise them. Our conclusions were accepted by the Government, which is one reason for them seeking to align RDA strategies more closely with their economic policies and plans, as well as the relevant public service agreement targets.
The Committee also recommended that the Department of Trade and Industry should measure the impact of the RDAs on regional economic performance—the growth and prosperity in each region—by means of improved data. The Government accepted that recommendation and, as a result, their statistical service will, in each region, publish regional data by March 2007. Those will be completely delivered by 2009, which sounds a long way off, but unless we understand exactly what is happening in each region we will not be able to get the policies right to deliver in that area. Adding up the effect in every region means considering the transformation of the entirety of England.
If our aim as a Government is to extend opportunity across the country, regardless of which town we happen to call home, understanding the levers that have an effect on each part of the economy is crucial. As powers and budgets are devolved to the RDAs, their ability to impact on regional and sub-regional economies is increased, but without the ability to monitor the effect there will be a danger of public money being misused. That is what we are trying to avoid.
The Government have a high-level PSA target to reduce the disparity of growth rates between regions, a stretching target and one that the Committee should revisit. I thank the NAO for agreeing to do some analytical work leading, I hope, to a report later this year on the effectiveness of the Government's policies in this area.
Our Committee can make a large contribution to the economic theme. Recently the Treasury has made progress in extending our understanding, as a nation, of the levers of economic growth. It is not to make a party political point to say that now that unemployment is low, to raise GDP we need to focus on productivity—the amount of wealth produced for each person in work. It is a dry economic word and one cannot just affect it by waving a wand. The effect of the Treasury's work has been to make us realise what we do need to wave to get the growth that we all want. We need to ensure competitive markets, raise skill levels, increase investment and so on. There are officially five drivers of productivity.
If that is our high-level objective, the next question is whether taxpayers' money spent in this area has the desired results. It is a difficult question, but we need to focus on it. It is difficult because it is notoriously hard to make a link between the micro and the macro; how can one create a link between the amount of taxpayers' money spent on these various economic levels and the actual eventual outcome in terms of macroeconomic indicators, productivity and ultimately GDP?
Without an attempt to quantify the links, there is a danger that millions, or billions, of pounds of taxpayers' money can be spent without having the effect on the
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economy that all of us want. I hope that other members of the Committee agree that we need to return to this question and that there are questions that we need to continue to ask, be it on competition, agencies—we had such an opportunity recently—the DFES and its work in raising productivity through the skills agenda, or the DTI, and specifically business links, and its policies to raise entrepreneurship.
To sum up, it is a pleasure to be on the Committee. I thank all those who have helped me to climb my learning curve in an attempt to serve on the Committee to greater effect. I hope that, through our work, we shall be able to play a part in not only securing greater value for money, but raising the level of growth in our country.
6.17 pm
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