Examination of Witnesses (Questions 80-98)|
17 OCTOBER 2006
Q80 Mrs James: That would be excellent.
Again, just following on reviews and performance, et cetera, your
Department undertook one of the new Capability Reviews earlier
in the year. What were the main messages arising from that review
and did anything surprise you?
Alex Allan: I think the message
that came out of our Capability Review, and indeed from talking
to other departments who have been through the process came out
of their reviews was there was not anything that was completely
out of the blue, and indeed it would be slightly odd if there
were. What it was was quite a lot of things which all departments,
including us, knew we needed to do more of, but had not quite
got around to doing it with enough energy as we perhaps should
have done, and it highlighted those. I think that is a fairly
common theme. For us, as I think I said earlier, it was encouraging
that it was actually quite complimentary about our overall strategy,
but it identified a number of areas, for example, where we had
a rather fragmented change management programme. We were going
through lots of change but we had change management in a number
of different bits of the Department and we needed to pull together
a single change management programme, which we have done. It highlighted,
again a point I made earlier, that we have got some quite big
delivery challenges and if we are going to achieve what we want
to do, that is a big challenge. We have set up more performance
management and a whole lot more work to do that. Then it also
highlighted areas over what I think they called our business model,
which was basically how we worked together corporately to bring
together the different bodies which make up the Departmentthe
Courts Service, the Tribunals Service, the Legal Services Commission,
the centre, how we operate with shared services.
Q81 Mrs James: They actually said
that that was an urgent development area.
Alex Allan: Indeed. We have done
quite a lot of work following that. I think we sent you a copy
of our action plan.
Chairman: I think we would like to be
kept up-to-date on the progress that you make. You mentioned Carter
and I think Dr Whitehead had a comment about that.
Q82 Dr Whitehead: You have mentioned
already that Lord Carter's review will result potentially in substantial
savings, the suggestion was £100 million savings annually.
Obviously we are conducting an inquiry generally into the Carter
review, but in terms of the Department's budgeting and financing,
what would be the consequences for the departmental budget if,
for example, Lord Carter's recommendations were not implemented
in full? Has the Department already banked, as it were, those
savings in terms of its future budget?
Alex Allan: I am sure that, as
we move forward to draw up a plan with the Treasury, the Treasury
will want to hold us to implementing the Carter review proposals.
More generally on legal aid, I think we may face problems over
legal aid, either from not implementing all the Carter proposals
(although we are very determined to do that) or from other fluctuations,
and I think we are putting a lot of work into getting a much better
focus on legal aid spending, exactly what drives it, and the sorts
of pressures that it comes under. As you were, I think, implying,
if we face an overspend on legal aid we have to find savings elsewhere
and that is something that we will have to do. We believe that
the Carter proposals actually work together with the rest of what
we are doing and they produce a much long-term system of procurement
of legal services through a table of fixed fees and so on that
will actually help us to achieve some of our other objectives
on speeding up the justice system. So it is a critical part of
the work to make sure that this does get done. At all sorts of
levels we work very closely with the Legal Services Commission,
and the Parliamentary Secretary Vera Baird is taking a very strong
interest and, as I think you may know, she spent a lot of August
touring the country talking to solicitors to try to get their
Q83 Dr Whitehead: That is rather
a kind way of expressing it!
Alex Allan: Clearly there are,
as I think was made clear at Questions today, some areas on the
family side where we are going to have to reconsider exactly how
it is implemented but it is very, very important that we implement
the thrust of the Carter reforms successfully.
Q84 Dr Whitehead: Do you not think
that the Department is in perhaps something of a position of a
hostage in as much as you the Department are, in a sense, relying
on the fact that the Carter report figures are accurate and the
savings are achievable and, secondly, you are going to Treasury
with already published figures, as it were, for would-be savings
from a review which was not a review by the Department, and will
the Treasury therefore not say, "Well, that is a done deal;
we will have those at the beginning of the discussion," and
you will then be liable, as it were, for those savings when someone
else has come up with them and not you?
Alex Allan: Well, we did work
very closely with Lord Carter to try and provide a lot of support
to his team, including paying consultants Frontier Economics to
work with his team to make sure that the numbers were right. So
we feel that these are numbers that are deliverable. The Legal
Services Commission, the actual commission, the independently
constituted body looked at the numbers and it believes that it
will deliver the changes. They go with the grain of what the Legal
Services Commission was doing in terms of trying to set up systems
of preferred suppliers. So I do not think it is quite Lord Carter
independently said this and then we are complete hostages. We
did work closely with him. He did a lot of work with the Law Society
and with the Bar Council on the precise schemes, particularly
on the criminal side although, as I mentioned earlier, we do accept
that some more work is needed on the family side. So I think that
it does not feel like something that we have farmed off to an
independent reviewer and then simply sat back and took what was
coming to us.
Q85 Mr Khabra: I am going to ask
you a question about your relationship with the Home Office. The
Department shares responsibility with the Home Office and the
Office of the Attorney General via the Office for Criminal Justice
Reform. The Treasury's Financial Management Review in 2005 found
that you were not sufficiently included in all consultations.
Have you now increased your involvement? Would you say that you
are a full partner with the other responsible departments?
Alex Allan: I would say yes we
have improved our consultations and we do feel that we are full
partners in the criminal justice system with the National Criminal
Justice Board, the Office for Criminal Justice Reform, and the
local criminal justice boards. Clearly, as I indicated earlier,
it is very important that we do work closely with the Home Office
on all these issues and we have got links in at lots of different
levels. Picking up, sir, one of the points for example on legal
aid, we do now have very clear arrangements in place that if another
department makes a change that imposes unexpected costs on us,
then there will be a public expenditure transfer to enable us
to meet those costs, and our accounts show examples in money transferred
from the Home Office for downstream costs associated with the
2003 Criminal Justice Act and also money transferred from the
Department for Education and Skills for money associated with
the Adoption and Children Act. So inevitably the Home Office is
larger in scale in terms of its overall budget than us, but I
think the Home Office recognises that there is a shared interest
in trying to make sure that the whole system works well. To take
an example, the Home Office at the moment has obvious pressures
on prison places, and one of the areas is remand places, and so
for them if they see that there are delays in the crown courts
so that prisoners may be held on remand for longer then that clearly
has very big impacts on them, so I think that there is increasing
recognition that we are all in business with a common endeavour.
Q86 Mr Khabra: Has there ever been
an occasion where there has been a conflict of interest or a conflict
Alex Allan: Inevitably at times
there will be differences of political view about what is the
best way forward, but I think the system is now robust enough
that that can be resolved and, as I say, our working relationships
are very good at all levels right from the top to the bottom.
Q87 Mr Khabra: The Home Office has
already received its settlement from the Comprehensive Spending
Review. What impact does this have on the scope for joint planning
between the two departments?
Alex Allan: I accept that at one
level it seems slightly odd that one part of the system has settled.
We are still doing a lot of joint work, as Barbara Moorhouse said,
and I will ask her to speak on this in a moment, and of course
the Crown Prosecution Service has not yet made a settlement. I
think we are conscious that although, as Barbara indicated, the
Home Office settlement is at the upper end of the range, given
the pressures, for example on the police forces, the pressures
from the counter-terrorism strategy, the needs in the Prison Service
it is actually a pretty tight settlement. I guess it would be
a worry for us if they had an enormously generous settlement and
lots and lots of defendants were heading our way and we got a
very miserly settlement and we could not cope. It does not feel
like that and, as I say, there is a lot more work going on to
try and join it up, but Barbara may be able to expand a bit more.
Barbara Moorhouse: Yes, the Home
Office did receive what at the time was seen to a relatively generous
settlement but I think since then there have been a number of
changes in expectations around the Home Office, and therefore
what might have seemed like a generous settlement at that stage
probably looks a great deal tighter if you are sitting in the
Home Office today. I think the key issue going forward is that
once we have agreed our settlement, whenever that may be, there
are two ways that it can go in terms of talking about financial
management. I think there is a strong pressure for all of the
three agencies or departments to see those areas where by working
together they can manage money better. We have had a number of
examples where all three parties have recognised the value of
working together on certain key projects. I think there are a
number of good examples of that. However, I think there are also
some challenges and as all three departments are likely to receive
settlements less than they would have liked, obviously there is
going to be a lot of challenge around us all being careful about
how we manage money. The good side of that is that I think all
three departments are now much, much sharper, I suppose, at focusing
in on when new initiatives are going to cause them considerable
cost and making sure that that thinking is built into the trilateral
work before any particular policy or operational decision is made.
That is extremely healthy and I think that will help to improve
the overall quality of financial management across all three departments.
However, it will also mean that there may be some short-term tensions
around how some of those policy decisions pan out given that they
impose different costs on one department where the investment
might be made in another party. There will be some benefits of
trilateral working in a tighter financial climate; there may also
be some negatives. Overall, there is no doubt that effectively
value for money across the criminal justice system really does
need the three agents in these departments to work together.
Q88 Mr Khabra: Did you have consultation
with the Home Office prior to the Comprehensive Spending Review
with regard to your priorities?
Barbara Moorhouse: No, we have
been in discussion with the Home Office and there have been some
issues at policy and strategy level, but I do not think it would
be true to say there was a full-scale discussion of our Comprehensive
Spending Review or indeed theirs before they settled, but a number
of the aspects of that are covered in various pieces of bilateral
and trilateral work at official level.
Q89 Mr Khabra: On the question of
your Department's estate management abilities, in the past there
have been weaknesses. What improvements have you made and can
you give some examples of the improvements?
Alex Allan: This is certainly
an area we are focusing a lot on not just because of the financial
pressures but also because we now have a very much bigger estate
with the bringing of the magistrates' courts into Her Majesty's
Courts Service, we now have responsibility for all the estate
and that is something which we are looking at across the whole
estate. Maybe there are areas where we have a county court, a
magistrates' court and a crown court in very close proximity and
we need to look at that. We have put a lot of effort into improving
our general capability to do the planning and management of the
estate's function. We have set up a capital investment board that
Barbara chairs which I think is moving towards getting a very
much clearer picture of not just the estates but looking at IT
investment as well.
Q90 Mr Khabra: What mechanism is
used to manage such a huge estate like the one you are responsible
Barbara Moorhouse: I think the
main work that has been done since the Courts Service came together
has been basically to establish the facts of what we own and the
condition which it is in to get a thorough understanding of the
asset base we have to manage. The tribunals have now got to go
through that same process although their portfolio is much smaller
and a lot of it is rented rather than being owned, so they have
to go through a parallel process. It is also true to say that
a lot of our thinking around estates has been very much governed
by the level of capital investment or capital expenditure that
we think we will be allowed in the Comprehensive Spending Review.
It is true to say that when the courts produced their initial
thinking about the amount of investment that they needed in the
courts buildings, it included some very attractive and ambitious
plans about rationalising buildings and, indeed, building new
buildings which were, perhaps, geographically better for the current
use of court business. It has become very clear as we have gone
through the Comprehensive Spending Review that we were unlikely
to receive that level of funding as we had originally hoped. Therefore,
at the current time, we are going back now to revisit that initial
thinking and to make sure we are prioritising the likely level
of capital investment which we will have in the light of all of
the work that we are doing around the use of courts and the change
programme in HMCS so we are making best use of our existing estate,
making disposals wherever we can so we have the opportunity to
re-invest, and not being so reliant on the Treasury to produce
significant extra funding in order for us to improve our estate.
That is where our current thinking rests and we will be progressing
that through the rest of the Comprehensive Spending Review discussions
with the Treasury.
Q91 Mr Khabra: Could you tell us
if you receive any income from the estates?
Barbara Moorhouse: I am sure there
are bits and pieces of little rentals that we receive here and
Alex Allan: There are some innovative
court managers who rent out their courts on Saturdays for weddings
and things like this.
Rod Clark: Or do television shows
and things like that.
Barbara Moorhouse: It certainly
is small, we know that.
Q92 Chairman: The Committee has in
the past taken an interest in the fact that you have a considerable
historic state of listed buildings, some of whichit is
argued by a lot of peopleyou ought to be using and sustaining
and not simply pulling the rug from underneath them where they
can be successfully used. I hope that is still forming part of
Alex Allan: Indeed. Although it
caused some controversy, if you take the case of Middlesex Guildhall,
which will be converted into the new Supreme Court, we believe
that the plans that were developed by Fielden, Mawson and Fosters
really do justice to what is a historic building and take out
quite a lot of the additions that have been made over the years
to make it suitable as a crown court and take it into a much more
open environment in a way that is sympathetic to its historic
use. Of course, as you say, we have a number of historic buildings
on the court estate. There will be some where we simply do not
believe they should continue to form part of our estate. As you
know, we sold Bow Street Magistrates Court together with the Metropolitan
Police who sold the police station next door that had been closed
for some time simply because there was no part of our estate planning
to indicate that was a sensible asset to hold on to and so we
are doing developments at Marylebone Road and Horseferry Road
to absorb that capacity. There will be some buildings which we
will dispose of; there will be some buildings that we will cherish.
Q93 Chairman: You have inherited
some PFI contracts also. Are you going to manage these successfully
and do you envisage more PFI contracts for future court projects?
Barbara Moorhouse: In short, we
have nine PFI contracts and the costs of those are built into
the base planning for the process. We do not envisage at this
current time being able to use PFI as a procurement route in the
future. I think it would be fair to say that a lot of PFI thinking
was driven by the particular accounting rules that prevailed at
one stage. Now that those no longer prevail, I think it is unlikely
that we will use a new PFI procurement route.
Q94 Chairman: A couple of quick questions
on a couple of other points. Why is it you have overshot on recovering
court cost fees, 104%? Committees, in the past, have had anxieties
that access to justice is in any case potentially limited and
denied by full cost recovery.
Alex Allan: I do not believe in
aggregate we have overshot.
Rod Clark: Not looking at civil
and family together.
Alex Allan: Certainly, we do monitor
the level of fees very carefully. As you say, we do have a target
for full cost recovery, excluding the fees that are omitted, for
example if somebody falls below income tests. It is full cost
recovery allowing for that, so we do not try.
Q95 Chairman: You do not charge other
Alex Allan: We do not charge other
users to cross-subsidise people who are exempt from fees, no.
Q96 Chairman: In your annual report,
you do remind us that you are "conducting research into the
experience of different electoral systems in the UK in line with
the Government's manifesto commitment". When is this research
likely to see the light of day?
Alex Allan: I think I would be
rash to promise exactly when. There is indeed, as the report says,
work going on within the Department. It is something which I am
sure the Lord Chancellor will want to consider, although he will
need to consult his ministerial colleagues, and we will publish
in line with the manifesto commitment as soon as we are able to.
Q97 Chairman: Is it nearly finished
and are ministers waiting to decide whether or not to publish
it, or is there a lot more work that you have to do?
Alex Allan: I think most of the
underlying factual information has been done. Exactly how it is
pulled together and presented and what conclusions are drawn is
something that is still going on.
Q98 Chairman: And you said it with
a straight face! Thank you very much.
Alex Allan: Thank you.