Examination of Witnesses (Questions 60-79)
SIR MICHAEL
JAY, KCMG, MR
RICHARD STAGG,
CMG, MR DAVID
WARREN AND
MR RIC
TODD
26 OCTOBER 2005
Q60 Chairman: Perhaps when you have
the figures you can send us a note; but if you have some round
figure now, it would be helpful.
Sir Michael Jay: We expect to
make about £6 million savings, which would contribute to
the efficiency target of £87 million. That is by 2007-08.
However, there are other targets which we also have to meet. We
have to reduce our local staff pay bill by a certain amount. The
only way you can do that is by reducing the number of staff. So
it contributes to that as well, and allows you to have staff elsewhere.
Q61 Chairman: That is salary savings.
That is the recurrent annual expenditure.
Sir Michael Jay: Yes, running
costs.
Q62 Chairman: What about capital?
Are you likely to get capital receipts from all this?
Sir Michael Jay: We will get some
capital receipts from the sale of buildings. I cannot tell you
what those will be, because in not every case has the building
been sold; and it is a mug's game trying to estimate—
Q63 Chairman: Who gets that capital?
Do you get it or does the Treasury have it?
Sir Michael Jay: Yes, we get it.
Q64 Chairman: All of it?
Sir Michael Jay: Yes. That counts
as asset recycling, so we would get the benefit from that. Our
policy as from, I think, the beginning of next year—this
financial year—is that 100% of the money that we get from
asset recycling goes into the estate. So the issue which this
Committee has been concerned about in the past—that some
of the money which we have received from asset recycling has gone
into IT—is no longer the case.
Andrew Mackinlay: Two matters I want
to ask about. The first one is the Holy See. We were told by yourself
that there were going to be new ways, alternative ways, of dealing
with this and I understand that the post is being advertised.
I have heard what you say about the need for savings, which you
have elaborated on today. However, as well as an important post,
it is a great honour to be Ambassador to the Holy See. Am I correct
that, frankly, nobody could succeed in the advert for this post
unless he or she was of some private means and/or located at their
expense in Rome? Put another way, is there any chance of working-class
people being appointed?
Chairman: Give him a job!
Andrew Mackinlay: Or do you have to be
part of the magic circle which runs this country? Discuss. It
is a serious point though.
Mr Keetch: I will do Seattle!
Q65 Andrew Mackinlay: Can an ordinary
person apply? You have to have money, frankly. That is point A.
Sir Michael Jay: I do not think
that is the case. The post has been advertised and there were
a very large number of applicants—I think 120 applicants
altogether. There has been a competition, a candidate has been
chosen, and agrément is being sought. An announcement
will be made in the near future. This will be, I think I am right
in saying, a normal diplomatic service appointment when made.
What will be new is the method of appointment. In other words,
an outside competition.
Q66 Andrew Mackinlay: We look forward
to details on that. Point B is not for ritual but seriousness—Kyrgyzstan.
Since we last met on the annual report and in previous years,
I have asked you about this. Since then, we have had something
of a velvet revolution in Kyrgyzstan. There is now the problem
of refugees from Uzbekistan in Kyrgyzstan, and the United States
are moving from Uzbekistan to Kyrgyzstan. Other key players are
represented there. We are not represented even on the cultural
side, by the British Council. Is it not now time that you reviewed
your decision not to have anybody in Bishkek, bearing in mind
that the ambassador who does serve it is based in Almaty, which
is not only not the capital of Kazakhstan but is also in a country
which is the size of western Europe? Discuss!
Sir Michael Jay: Again, I would
like to have an embassy, we would like to have an embassy, in
Bishkek. It is a question of the proper allocation of resources.
By far the most important of the central Asian countries in terms
of British interests is Kazakhstan, which is why we plan to maintain
an embassy in the new capital, in Astana, but also a substantial
presence in what will remain the commercial centre, Almaty, which
is about two or three hours' drive from Bishkek; and there will
be regular visits from the staff of the post in Almaty to Bishkek.
For the moment, I suspect that is how it will stay, but I can
assure you that we do keep these constantly under review. The
views of this Committee on where we might have posts would clearly
be a factor, if we are in the happy position of being able to
open more than we feel now we can.
Q67 Mr Mackay: Sir Michael, clearly
you would like to keep more posts open and clearly it is a matter
of balance—priorities, as you have pointed out. We understand
your budgetary constraints. We understand that you are having
to make efficiency savings right the way across your department.
Would it be wrong to say, however, that every bit of saving for
a new post has to come out of closing an existing post, or is
there not a possibility of making further cuts in other things
your department does? For some of us, one of the most important
things you do is to be represented in as many countries and as
many commercial cities as possible. I do not want to prejudge
your answer, but I guess that if I were looking at your budgets
I might, in a slightly biased way, come up against other things
that I think could be cut out to ensure that our representation
was not cut out.
Sir Michael Jay: There are two
answers to that. The first is that we are always looking at doing
things more efficiently, in order to produce savings which can
then be put to higher priority activities. One of the benefits
of a lot of our IT will be, I hope, that it will release resources
and release staff to go to higher priority tasks, including overseas
posts. As for cutting programmes, I think I am right in saying
that we are not allowed to use capital or programme money for
administrative expenses. So even if we were to reduce our programme
expenditure, we could not use that on our staff, to open or keep
open an overseas post.
Q68 Mr Mackay: And that is a Treasury
rule that you have signed up to—or you have no choice?
Sir Michael Jay: As accounting
officer, I get letters from the Treasury explaining what I have
to do.
Q69 Mr Mackay: That does seem a pity,
because I would prefer you and the Foreign Secretary to be given
a free hand to allocate your budget as you see fit within your
department, which clearly you cannot quite do.
Sir Michael Jay: We can to a certain
extent. What we can certainly do, and do try to do, is to find
more efficient ways of doing things, so that we therefore release
resources to open a post or to keep a post open; but there are
constraints on our ability to—the technical term is—vire
between one budget and another.
Q70 Mr Mackay: So there is ring-fencing,
in other words?
Sir Michael Jay: Yes, in that
sense. There is also ring-fencing, of course, in that very substantial
proportions of our overall budget are for the British Council
and the BBC World Service, which are ring-fenced and therefore
are not accessible to us, either for our capital or for our programme
or for administration budget.
Chairman: Can I just say to my colleagues
that there are a number of areas we have to cover. I want to get
on to personnel issues but, before we do that, I want to get Fabian
Hamilton in on the BBC World Service and to touch briefly on public
diplomacy; then we will deal with the personnel matters. I am
very conscious of time.
Richard Younger-Ross: Very briefly?
Chairman: It has to be very brief. One
question.
Q71 Richard Younger-Ross: It is one
question on asset recycling in Dublin. Can you explain whether
we are likely to get Glencairn back, when we are likely to sell
Marley Grange, how this debacle came about, and how much it has
cost us so far?
Sir Michael Jay: We are of course
in occupation of Glencairn and we are in touch with the owners—constantly
in touch with the owners—in the hope that we can complete
the purchase of Glencairn, which we have not yet succeeded in
doing. Until we can, we think it is better to keep Marley Grange.
Whether you want me now to go into all the background again—
Q72 Andrew Mackinlay: The background
is in the public domain.
Sir Michael Jay: I have been asked
about it by this Committee before, and I think it is in the public
domain. If it would help the Committee, however, I would be very
happy to write again to update it.[8]
Andrew Mackinlay: Presumably you are
paying rent.
Q73 Chairman: Perhaps you could send
us a note updating us on the current position and, if necessary,
we will pursue it with you.
Sir Michael Jay: Certainly. I
am very happy to do that, Mr Chairman.
Mr Hamilton: Sir Michael, I want to ask
you some questions about the BBC World Service and the changes
that are being planned there. I am well aware, of course, of your
deep involvement with the World Service. Yesterday, the Foreign
Secretary, in a written ministerial statement, endorsed the proposed
changes by the World Service and the rationalisation of some of
their local language services. They are intending, as you know,
to cut some of the language services in places like the Czech
Republic, Hungary, Kazakhstan, Poland, Slovakia, Bulgaria, Croatia—
Chairman: And Thailand.
Q74 Mr Hamilton: Yes, and Thailand—which
have very small audiences at the moment, and use those savings
primarily to establish a BBC Arabic television service. I wondered
what your reaction to this would be. Do you endorse what they
are trying to do? Do you feel that an Arabic TV service would
more accurately report what the British Government is trying to
do in its foreign policy, as well as its interest in the Arabic
countries? How do you feel that the BBC is best served, and is
it in our interest to drop these local language services, which
have been so important over the last 60 years?
Sir Michael Jay: These are essentially
questions for the BBC, but we have encouraged the BBC to look
constantly at the profile of their vernacular services, to check
that they really were focused on the areas which are important
today rather than, say, 40 or 50 years ago. We do endorse their
judgment that this is a good time or the right time to discontinue
the vernacular services in these countries, bearing in mind that
the English language services will continue and that there will
still be the availability of BBC World and online BBC World Service
services. So they will have English language services; they will
have BBC World; and they will have BBC online. What they will
not have is the vernacular services. We endorse that judgment,
though it is a judgment by the BBC.
Q75 Mr Hamilton: Of course I understand
that their operating policy is a judgment for them, but my question
to you relates to British foreign policy interests, which I know
the BBC is not there to conduct fully, but that is why you fund
them. We have an interest, do we not, in terms of our foreign
policy in some of the countries in which the BBC World Service
broadcasts? I wonder whether you feel—where, for 60 years
in many of these countries, we have broadcast in those services—that
we shall be best served by dropping those local, vernacular language
services?
Sir Michael Jay: I think that
the BBC would argue—and we would not dispute this—that
in a sense, 60 years on, the services have served their purpose.
The vast majority of these countries are now democracies, liberal
market economies, members of the EU or of NATO, with a much greater
ability to speak English than was the case in the past. In a sense,
this is a good moment to recognise that, if you like, the job
is done and now is the time to allocate those resources to today's
priorities. We would, in the Foreign Office, argue that one of
today's priorities is to have a stronger public diplomacy focus
on the Arab world and that an Arab-language TV service would be
a very good way of providing that. That is the reason why we would
support and do, and the Foreign Secretary did yesterday endorse
the changes to the vernacular programme and the suggestion that
this should go towards an Arabic TV service.
Q76 Mr Hamilton: We know, do we not,
that satellite TV services are notoriously difficult to start
up, especially in the Arab world? We also know how expensive they
are. I wondered whether you thought that £25 million, which
I understand is the cost that is being allocated and therefore
being funded out of some of these savings, is sufficient to do
the job properly.
Sir Michael Jay: I do not have
the expertise to comment on that, Mr Hamilton.
Q77 Sir John Stanley: I have to say
that I do most profoundly disagree with you, Sir Michael, at least
in respect of one country, and I am most disturbed that you should
have given a blanket endorsement to a policy of going for English
language services as opposed to vernacular language services.
If I may, there is a country I would want to make an exception.
I am Chairman of the Britain-Nepal Parliamentary Group, and perhaps
I may just put that on the record. Last week I had the benefit
of meeting the President of the Institute of Journalists in Nepal,
who is in this country on an FCO-sponsored visit—and I am
delighted that your department did sponsor his visit. He told
me how concerned they were in Nepal at the threat to Nepali language
services. In that country, where something like two-thirds of
the country is in Maoist control, where the people of that country
are utterly dependent for information and for news on the BBC,
I think it is absolutely appalling that at this particular moment
there should be a threat to Nepali language services in that country.
Sir Michael Jay: I am not informed
about the Nepali service, Sir John. Perhaps I could look into
it.[9]
Q78 Chairman: We will no doubt pursue
it if necessary. I think that we have dealt with some aspects
of the public diplomacy side. May I ask you why we have not yet
had Lord Carter's review on public diplomacy? We were promised
that it would be completed by the summer. This Committee took
evidence from the British Council a couple of weeks ago. We had
expected it before then; so had they. It did not happen. We had
to ask them questions about it in the absence of actually seeing
it. It is not available today. We have not yet had any indication
of when it will be published. Can you tell us why not?
Sir Michael Jay: My understanding
is that Lord Carter is still discussing one or two elements of
the report with one or two of the other stakeholders involved.
Q79 Chairman: The British Council?
Sir Michael Jay: The British Council,
yes.
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