Questions from Foreign Affairs Committee
for written answer by 3 October
EFFICIENCY AND
REGULATION
1. The National Audit Office (NAO) and the
Audit Commission have reviewed departments' efficiency technical
notes. What recommendations or conclusions affecting the FCO have
resulted from this work? What action has been taken in response
to these findings?
2. In the 2004 Spending Review the FCO's
administration budget will increase by 16% from 2005-06 to 2006-07
and then by 4.3% to 2007-08. These increases are significantly
greater than the increase in the total resource budget. Almost
every other department has a decreasing administration budget
over this period, reflecting the Government's efficiency agenda.
Why is the FCO's administration budget continuing to increase
so significantly? What impact is this having on front-line services?
3. The Office intends to make 2.5% year-on-year
efficiency savings over the 2004 Spending Review period (DAR page
197). This target is unchanged from the 2002 Spending Review.
Many other departments have increased the scope and extent of
their intended efficiency savings. Why is the FCO's efficiency
savings target not more ambitious, in line with those of other
departments?
4. The report by Collinson Grant on efficiency,
effectiveness and the control of costs in the FCO concluded that
10% of the Office's posts could be abolished and identified over
£60 million of potential savings, considerably more than
the Office's current plans. The report also highlights the lack
of appropriate professional skills, including finance, human resources,
political and diplomatic skills. Does the FCO accept the findings
of the Collinson Grant report? What plans does it have to implement
the report's recommendations? Given the lack of appropriate professional
skills, how will the Office ensure that staff cuts will not further
reduce FCO's skill base?
5. On 15 December, the Foreign Secretary
announced the closure of eight UK-staffed sovereign posts, and
moving from UK-based to locally-based staff in a further 11 subordinate
posts. What has been the net reduction in FCO UK-based staff as
a direct result of these changes? Is this in addition to, or included
within, the reduction in SMS posts already announced?
6. Savings from efficiency measures will
be reinvested in front-line services. What plans does the FCO
have to ensure that services are fully funded in the event that
anticipated efficiency savings or returns from sales of FCO properties
are not realised or are delayed?
7. Appendix B of the DAR shows slippage
of some long-term IT projects. What impact will these slippages
have on efficiency savings planned to arise from the increased
use of IT?
8. The Office planned to expand its i-visa
service to another 35 posts by 2005. Has this happened? What is
the timetable for introducing this service in all posts where
it is viable?
9. Page 200 of the DAR outlines what plans
the Office has to relocate staff, but it does not quantify the
planned savings. How much will be saved annually from this initiative?
What costs will there be, including relocation and redundancy
costs?
10. The Treasury PES Paper (2004) 19 (revised)
requires the DAR to make a number of disclosures on better regulation,
including statistical figures on performance in meeting Regulatory
Reform Action Plan commitments, delivering Regulatory Reform Orders,
Compliance with the Regulatory Impact Assessment (RIA) process
and the number of commitments made in final RIAs to review regulations.
The only reference to regulation in the FCO DAR is in Appendix
J, which lists the two RIAs made in 2004. Can the FCO provide
the omitted information?
FINANCIAL
11. The Office implemented a new financial
system in April 2004 and the 2004-05 accounts will be the first
produced using this system. How has the accounts production process
using the new system worked? In particular will the FCO meet its
planned timetable for signing the account? Has the system been
fully implemented in all overseas posts?
12. The Treasury and the NAO are currently
undertaking a review of the adequacy of financial management in
Departments. Have any conclusions or recommendations emerged from
this work thus far?
13. The 2006 Spending Review has been postponed
until 2007. Will this have any impact on the FCO's spending plans
as outlined in the DAR?
14. The 2004-05 figures given in Appendix
A are estimates. Can the FCO provide the actual 2004-05 figures
for tables 10, 11 and 12 on pages 215 and 216 of the DAR?
15. The outturn total administration expenditure
for 2003-04 in the 2005 DAR (page 217) is £168 million (17%)
below the estimate given in the 2004 DAR (page 179). Income was
underestimated by £99 (61%). Can the FCO explain why its
estimates were not more accurate?
16. HMT published Public Expenditure 2004-05
Provisional Outturn gives the Office's year-end flexibility figures
(table 6, page 14). This is 6.6% of their total resource. In particular
the carry-forward for the capital budget is 30% of FCO's capital
DEL. Why is such a significant carry-forward needed against the
capital budget?
17. Paybill figures and an analysis of administration
costs by activity are not given for 2004-05 or future years (page
217). There are also no figures for 2004-05 for analysis of resource
budget by objective (page 223). Why was the Office unable to provide
estimates for these? In particular the lack of paybill figures
seems to conflict with the claim that there is now greater focus
on workforce planning and paybill control (page 187). What is
the explanation for this? Is the Office now in a position to provide
the committee with the above figures for 2004-05? What impact
does the inability to produce budgets for staff costs and administrative
expenditure by objective have on the FCO's planning and budgeting,
particularly in relation to delivering its PSA targets and its
efficiency agenda?
18. Analysis by objective as per Schedule
5 is currently done by an annual six-week exercise (page 205).
This obviously does not provide data in time for inclusion in
the DAR, nor can it provide the Office with useful in-year management
information for monitoring purposes. What plans does the FCO have
to improve its systems, to enable more timely and frequent information
on spend by objective?
19. The actual valuation at the end of 2003-04
of non-residential land and buildings in the 2005 DAR (page 216)
is £96 million (16.7%) above the estimated valuation given
in the 2004 DAR (page 178). For residential land and buildings
the figure is £119 million (28%) below the estimate. The
actual net current assets are £54 million (83%) below the
estimate. Why did the estimates differ so significantly from the
actual values? What plans does the Office have to improve its
year-end and month-end estimation exercises to enable more accurate
financial monitoring by management?
20. Are final figures now available on the
repurchase of Glencairn and sale of Marlay Grange?
21. Appendix I states a provision of £2.3
million for disputed claims for rents payable on overseas properties.
This is a new provision. What is the nature of these disputes
and why have they arisen?
22. Have costs associated with the UK's
presidencies of the G8 and EU been within forecast limits? What
was the cost of hosting the G8 summit at Gleneagles; and how much
of this was borne on the FCO budget?
LONG-TERM
INVESTMENT
23. Writing in e-Diplomacy last year, the
then Minister Bill Rammel stated that "The Future Firecrest
project will deliver in 2005-06 the next generation of our Desktop
system". Appendix B of the DAR shows that the current estimated
date of completion of the Project is 2012. What is the reason
for the apparent delay in the Future Firecrest Project? What impact
will the delay have on the FCO's ability to meet its targets and
to deliver efficiency savings? In addition, the estimated cost
of the Prism project has risen by 20%, from £24.5 million
to £29.5 million; and the completion date has slipped from
2004-05 (FCO e-diplomacy strategy document, 2004) to 2006 (DAR,
Appendix B). What are the reasons for the delay and for the increase
in costs?
24. The estimated costs of three estate
building projects have risen significantly: the Chennai new offices
by £574,000 (13%), the Kampala new offices by £702,000
(10%) and the Belgrade electrical upgrade by £409,000 (33%)
(Appendix B). Why this has happened? What impact will it have
on the FCO's operations?
RISK MANAGEMENT
AND INTERNAL
CONTROL SYSTEMS
25. The Statement on Internal Control in
the 2003-04 resource accounts indicates that the Office's risk
management and internal controls are still in their infancy. The
FCO had only achieved the minimum standard required by the Treasury
(section 4). What progress has been made during 2004-05; and what
standard of risk management is the FCO currently rated at? Has
the FCO now made a full Statement on Internal Control?
26. The review of effectiveness recommended
a more cohesive IT governance structure and identified that Internal
Audit recommendations from previous years had not been implemented
(section 5). Have these issues now been addressed?
PERFORMANCE MANAGEMENT
27. The NAO is reviewing the data systems
underlying departments' PSA targets. What stage has the NAO review
of the FCO's systems reached? Are any conclusions or recommendations
available?
28. The Treasury PES Paper (2004) 19 (revised)
says that "departments should describe the quality of the
data systems . . . limitations . . . should be identified and
the implications for interpreting progress against the target
should be brought out for readers". There appears to be no
reference to this in the DAR. Can the FCO provide details of the
quality of the data systems, identifying any known or suspected
limitations in the data and explaining the implications for interpretation
of progress against the targets?
Objective 1—Security
29. The scorecards for PSAs 1, 2 and 3 are
classified. The progress box on page 39 mentions that milestones
for 2004-05 will not be met. Can the Committee be provided with
these scorecards? Is the FCO on course to meet each element of
the three targets?
30. The technical note states that the three
departments involved in PSA 4 (FCO, MoD and DfID) are attempting
to measure the number of people whose lives are affected by violent
conflict but explains the severe limitations to the quality of
the data. As such, it is not yet possible fully to assess the
progress against this target, although there is some discussion
of the available statistics on page 55 of the DAR. When does the
Office expect to be able to make an assessment of progress towards
meeting this target?
Objective 2—Trade and Investment
31. Performance against PSA 5 was below
the target level for two of the three measures in 2003-04. Is
the Office in a position to provide data for 2004-05, so that
the Committee can see the most recent performance? Where there
has been slippage, what measures are being taken to improve performance?
Objective 3—Prosperity
32. PSA 6 had a deadline of 2005 but progress
has been slow and the target has not been met. There is no similar
target in the 2004 Spending Review. Does the achievement of a
reduction in trade barriers remain a priority? By when does the
FCO now expect the target will be met?
33. The measures underlying PSA target 7
relate to democracy and legal issues in other countries. A large
number of factors can affect whether these measures are achieved,
including the actions of other countries. As such, the outcome
of this target can be affected by FCO only to a limited degree.
How is the Office able to assess its own performance against PSA
target 7?
34. The actual measures for PSA 7 are the
number of functioning democracies in the world, ratification of
core human rights treaties, the number of countries with fully
independent and impartial judiciaries and four specific outcomes
relating to international justice. The progress box on page 84
mentions free elections, projects and training, the millennium
development goals and the Kyoto protocol. Whist these are all
important in themselves, none of them are the measures set out
in the FCO's technical note for assessing this target. Can the
Office provide information on progress towards meeting the measures
specified in the technical note?
35. The Global Opportunities Fund (GOF)
is putting in place effective systems to establish whether projects
have achieved their purpose and to measure the impact of programmes
(page 126). By when does the Office expect these systems to be
fully embedded? When will the first results of this monitoring
be available? When will the GOF annual report for 2004-05 be published?
36. What are the implications of the establishment
of GOF for the funding of other bodies by FCO?
37. What plans are there to change the relationship
between the FCO and the Westminster Foundation for Democracy?
What plans are there to increase or to change the basis of funding
of WFD ?
Objective 4—Europe
38. Neither the box on page 76 nor the FCO's
technical note for 2002 targets details the specific measures
for assessing PSA 8. It is therefore impossible to tell what progress
has been made against this target. Can the Office provide details
of the scorecards used for measuring this target and state for
each element of the target whether it is on course to be met?
Where there has been slippage, what measures are being taken to
improve performance?
Objective 5—Impact Abroad
39. The report on PSA target 9 on page 158
does not explain progress in terms of the measures set out in
the technical note. For the BBC World Service and the British
Council it does not explain what are the underlying targets. It
is therefore impossible to judge whether targets are on course
or whether those elements with a deadline of 2005 have been met.
Can the Office please give specific details of progress against
the measures given in the technical note? Where there has been
slippage, what measures are being taken to improve performance?
40. Lord Carter of Coles has been carrying
out a review of public diplomacy in the first half of 2005 (page
146). When does the FCO expect to receive Lord Carter's Report?
Will the Report be published?
Objective 6—Public Services
41. Are the statistics for 2004-05 for PSA
10 now available? Can the FCO provide these, to enable the Committee
to see how it has performed against the target?
42. Issuing overseas passports was considerably
below target in 2003-04 due to increased security measures. Has
this trend continued? If so what measures has the FCO put in place
to improve the service?
43. The visa and consular services are intended
to be self-funding (page 196). Chapter 13 on consular services
uses data that are over a year out of date and the footnote on
page 160 implies that statistics are only on an annual basis.
In addition, schedule 1 in the 2003-04 resource accounts shows
that the demand for consular and visa services was £31 million
lower than expected and that demand is volatile and difficult
to predict. Given the difficulty in collecting data and predicting
future demand for visa and consular services, can the Office explain
how it can effectively budget to ensure these services recoup
their costs but at the same time do not over-charge? In particular
how did the Office arrive at the provision of £183.264 million
for the full cost of consular and visa operations for 2005-06
on page 220 of the DAR?
44. The NAO published a report on the FCO's
visa services in 2004. One of the recommendations from this report
is that information on performance needs improving (page 181).
In the light of this, how satisfied is the Office that the performance
reported for PSA 10 is accurate?
Objective 7—Overseas Territories
45. The FCO does not expect to meet that
part of the PSA target 11 which deals with constitutional reform
(page 143). It is not clear whether it is on course to meet the
other elements of the target; in particular, there appears to
be no mention of progress against the economic development element.
Can the Office state whether it is likely to meet each element
of the PSA target 11 and whether it has met those elements with
a deadline of March 2005? Where there has been slippage, what
measures are being taken to improve performance?
46. There has been a review of human rights
issues in the populated overseas territories and the FCO is considering
ways to address the findings (pages 141 and 142). What were the
main issues identified in this review and what is the timescale
for addressing them?
STAFFING
47. Table 14 on page 218 shows actual and
projected staffing for FCO. Given that the long-term aim is an
overall reduction in staff, why did the number of staff increase
in 2004-05?
48. Overtime has reduced in 2004-05 and
the plan is to reduce this still further so that in 2007-08 it
will be half the 2003-04 level. This is happening at the same
time as a reduction in the overall staffing level and during a
time of change for the Office. How will FCO ensure that this reduction
is genuine and that there will not be pressure for staff to work
undeclared overtime?
49. The FCO has recognised that it needs
to do more to promote diversity in its staff (page 188). The DAR
does not give specific diversity statistics. Can the FCO provide
figures on women, staff from ethnic minorities and staff with
disabilities as a percentage of total staff by grade? Can it provide
similar figures for staff recruited in 2004-05, indicating where
these are permanent appointments?
50. Has the FCO now identified all the senior
staff whose posts will be cut during the SR04 period? Have there
been any compulsory retirements as part of this programme?
51. The department had to review its race
equality scheme by May 2005 (page 189). What were the outcomes
of this review?
52. FCO is still working with DfID to resolve
the problems with differential local pay scales (page 193). When
is this likely to be resolved? Why has it taken so long?
53. The DAR says that "better management
information is a vital part of dealing with . . . complex issues
. . ." but does not give any indication that management information
has improved (page 193). What plans does the Office have to improve
its management information and what is the timescale for this?
BBC WORLD SERVICE/BBC
MONITORING SERVICE
54. When does the FCO cease to be the sponsoring
department for BBC Monitoring? Is the FCO content for this responsibility
to pass to the Cabinet Office?
55. The review of the BBC Monitoring service
concluded that there will be a reduction of 50-80 jobs. Do these
job cuts represent efficiencies or a cut in services?
56. The BBC World Service has been asked
to develop a business case for an Arabic TV station. This would
be funded from its 2004 Spending Review allocation (response to
the Committee's report on the 2003-04 DAR, response 38). How far
advanced is this process?
THE BRITISH
COUNCIL
57. The Council is intending to use efficiency
savings to fund on-going security costs (response to the Committee's
report on the 2003-04 DAR, response 13). What contingency plans
does the FCO have to ensure that security of Council staff and
premises is fully funded in the event that efficiency savings
do not materialise or are delayed?
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