House of COMMONS
MINUTES OF EVIDENCE
PUBLIC ADMINISTRATION SELECT COMMITTEE
Tuesday 2 May 2006
MS ANN ABRAHAM
USE OF THE TRANSCRIPT
Taken before the Public Administration Select Committee
on Tuesday 2 May 2006
Dr Tony Wright, in the Chair
Mr Gordon Prentice
Memorandum submitted by The Parliamentary and Health Service Ombudsman
Examination of Witness
Witness: Ms Ann Abraham, Parliamentary and Health Service Ombudsman, gave evidence.
Q1 Chairman: Good afternoon, everyone and a particular welcome to Ann Abraham, our Parliamentary Ombudsman. It is very nice to see you. This is not one of your arrivals when you come after your annual report and we generally ask you annual report questions; this is prompted, in particular, by a recent special report that you have done on occupational pensions, although we shall of course ask you other things too, as we always do. You have given us a memorandum. Would you like to kick off by saying a few things?
Ms Abraham: In relation to the memorandum?
Q2 Chairman: You may tell us whatever is on your mind, really.
Ms Abraham: There are lots of things on my mind! I do not have any prepared opening remarks, particularly. I have given you the memorandum, I have covered the areas that I thought the Committee would be interested in and I am happy to respond to any questions and provide any further information that the Committee needs.
Q3 Chairman: Can I ask you something else, completely different, to start with? I have been struck in the last few days, listening to all this stuff about the Home Office, that here is an example of massive maladministration, on any test, leading to injustice. It would have been the most obvious thing in the world, it seems to me, to try to find out what really went on by having someone like you, whose trade it is to investigate maladministration leading to injustice, to get in there, see all the papers and tell us exactly what happened. An Ombudsman in some countries would do that. Is it not a great disability that you cannot?
Ms Abraham: I am not sure I would agree that I cannot. It is interesting that you mention the Home Office and IND. If you look at (in fact, you cannot look at it because I have not published it yet) the annual report of statistics for the year just closed, IND is one of the major customers of the Office; it is not up there with DWP and the Revenue but it is a regular major customer, and in fact we have been considering whether we ought to perhaps be more themed in our IND investigations in recent months. So, I suppose, in the same way as tax credits got to the top of the agenda for us a year or so ago, it would not have surprised me if IND cases had got to the top of the agenda a little further on. So I do not think it is the case that I cannot, but what we are talking about, of course, is the own initiative investigation where, in effect, I am proactive in that before anybody brings a complaint to me. What I am saying is there are actual complaints in the Office and it is something that I suppose we could choose to consider a special report on.
Q4 Chairman: Are there complaints in the Office that bear directly on the current issue?
Ms Abraham: Not that I am aware of, no.
Q5 Chairman: Does it seem to you bizarre, though, that we can have inquiries into all kinds of things, some relatively minor (although no doubt important to the people concerned), we can have demands for Ministerial Code investigations if there are extremely minor accusations that you can append to a Cabinet Minister, but when we have a case of monumental maladministration we have not got a mechanism to get in there and inform Parliament and the public about what happened? You are the only mechanism that Parliament has available to it. What I think I am saying to you is: could you not find a way to get in there? If someone came to you who said: "I have been affected by what has happened. For example, I have been involved as a victim of crime, or my family has been involved as a victim of crime, consequent upon the release into the community of somebody who should have been deported, because of the maladministration", could you look at such a case?
Ms Abraham: Yes, I think I could. If somebody went to a Member of Parliament and the Member of Parliament decided to refer that case to me, then I could look at it.
Q6 Chairman: You would be very willing to do so
Ms Abraham: Every case I look at I would look at its merits; I would look to see whether there was prima facie evidence of maladministration, I would look to see what the injustice was and I would look to see whether there was a worthwhile outcome, but in principle there is no reason why I could not look at it.
Q7 Chairman: This Committee has urged you and your predecessors over the years, and we probably should repeat saying this, that we have some kind of mechanism so that when there is demonstrable maladministration going on leading to injustice, this instrument that Parliament has invented, the Ombudsman, has to be able to get in there somewhere, and Ombudsmen, over the years, have been rather hesitant to do this. When we have a case of this kind, do you not just itch to do what Parliament wants you to do, which is to go and find out what is happening?
Ms Abraham: I always itch to do what Parliament wants me to do. However, I work with the legislation as it stands. If I think back to 18 months ago, when this Committee was, I think, pressing me very hard to do a themed investigation into tax credits, I did not do that exclusively because the Committee pressed me to do so but it was very clear to me, from the number of complaints that were coming to us and from the concerns that were being expressed by Members and by this Committee, that it was something on which we should do more than a case-by-case investigation. So I suppose we are reactive; we are driven by the cases that come to us directly as Health Ombudsman or through Members in relation to Parliamentary work. You and I have talked before, and I think I have spoken to the Committee, about whether the time might have come for a review of the legislation, which is coming up to 40 years old. What is a fit-for-purpose Ombudsman in the 21st Century, 40 years since the 1967 Act? I think the time for that debate is appropriate and maybe that is one of the things that we should look at there.
Q8 Chairman: Thank you for that. You have said that you will respond positively if a Member of Parliament brings a case to you, and I think that is a challenge to us to enable you to get in there and do the kind of work that needs to be done. On the whole, you do get in there - you do find ways of getting in there. I want to turn now to the special report that you produced recently and to ask you this: I wonder if you are pushing the Ombudsman envelope out a bit because you have just produced this report, which is under Section 10(3) of your founding statute, and you produce these reports when you have recommended something that the Government has not agreed to. Now, in the whole history of the Ombudsman's Office, over the last 40 years, there have only been four such reports and two of them have been in the last two years. Does this tell us that you are going into territory that other Ombudsmen have not been into? Does it tell us that governments are less receptive to your recommendations and, therefore, there is some looming difficulty here, or is it just one of those things?
Ms Abraham: I do not know the answer to that and I suspect that it is a mixture of things. I do not see that I am going into territory that other Ombudsmen have not been into. I do not see that Government is particularly resisting my findings and recommendations. I think this report has to be seen in context and in the context of all the other work that the Office does. So, in the course of last year, we did 3,600 investigations and we upheld complaints in around two-thirds of those. In relation to the DWP, the department in question here, we did 600 or more investigations and they only rejected our findings and recommendations in one of them. So if you look at the degree of non-compliance, I think in the course of last year we had one GP who refused to apologise for striking somebody off their list; we had the Ministry of Defence, who are, perhaps, now coming round to our way of thinking, and we had the DWP. Obviously, it is a big case and it is an important case, but I think it has to be seen in the context of all the other work that the Office does and all the other cases where our findings and our recommendations are not resisted.
Chairman: As you say, in the Ministry of Defence case you have been entirely vindicated, and we may ask you later on how you think that is going in terms of what the Government is now saying. However, of course, the big one - the really big one - is the occupational pensions one. I am going to ask colleagues if they want to explore that with you for a while.
Q9 Jenny Willott: You suggested in your memorandum that it might be okay for the Department of Work and Pensions to accept that they committed maladministration but not accept the recommendations. Do you think that that would have been an acceptable response from the Department?
Ms Abraham: I think it would have been a more acceptable response. I think there is a proper distinction to be drawn between acceptance of the Ombudsman's findings of maladministration and whether that maladministration has led to injustice. I think that is absolutely the Ombudsman's territory and the Ombudsman's right. Obviously, this Committee will, no doubt, tell me if it thinks I have lost my reason and have reached findings that no reasonable Ombudsman could ever find. I hope we never get there. But I think that is not the Government, and I think the exchanges in Parliament have made it perfectly clear that Members fully understand that it is not for one of the parties, in effect, to a dispute to actually seek to overturn the judgment of the judge in the case or, as somebody said to me, it is like being pulled up for a foul and seeking to send the referee off the pitch. That is not the way the system works. So I think that is serious, and I have been concerned about the fact of the Government's rejection of the findings but, also, the manner of it. I think if it were regularly the case that government departments and agencies in the NHS refused to accept my recommendations, I would be concerned, but, as I have said, in 99.9% of cases they do accept them. So I think the system has been designed where I find that there is unremedied injustice as a result of maladministration but I bring that to Parliament. That is what I did in the MoD case and although I am disappointed that I had to do that I think that is the system and I think it has worked well. In relation to the report on occupational pensions, I did try to say in the report that there were big issues here which it seemed to me needed to be thought about and reflected on, and my recommendations were that the Government consider its response, and they took some time to do so. I think what concerns me is that they said: "We don't want any more, thank you very much. It would only raise expectations and we are not even going to consider what you say." So I think there are serious concerns and I would hope that the Committee would be equally concerned about the manner of the Government's response. However, I do think, if we are talking about issues of the scale that I saw in the pensions report, that there are real issues about how to put together a solution to the problems that these people have faced, and the extent to which the taxpayer should contribute to that and what the right solution should be. Those are quite properly matters for government and for Parliament and I see no reason at all why those matters should not go forward for debate in the proper place. That is why I draw the distinction.
Q10 Jenny Willott: Do you think that the argument is getting stronger for the Ombudsman to have the power to make the final recommendations?
Ms Abraham: I think if this happened regularly then the argument would get stronger. I think it would completely change the nature of my work, the nature of the relationship with government, the nature of the relationship with Parliament, and I think it would be unfortunate if a system that has worked pretty well, really, for 40 years had to be completely overhauled on the basis of one report and one government response to it.
Q11 Jenny Willott: Can I ask you more about the specifics of the report itself? I have to declare a constituency interest, along with a couple of my colleagues: I have a lot of people in my constituency who are former employees of Allied Steel and Wire, as I represent Cardiff, and one of the things that a lot of them are very angry about is the Financial Assistance Scheme and the fact that, I think, 15 people in Wales have received compensation so far, and the largest amount was about £600-odd. If the Financial Assistance Scheme had been more generous and covered more people, would your recommendations have been any different?
Ms Abraham: I suppose the simple answer to that is yes, and then a caveat that it depends. I think what the report does seek to do is to actually describe the injustice, and under the section which asks whether that injustice has been remedied, one of the possible remedies is the Financial Assistance Scheme, and the report explains why it does not cover all of the people and all of the injustice that has been identified here.
Q12 Jenny Willott: Or most of them, I would say. Do you think that the Pension Protection Fund which has now been introduced will mean that there are not future problems in a similar vein, and are you satisfied that does actually cover the future?
Ms Abraham: I cannot say that I have taken a particular view on that and my report does not attempt to speculate about the future. Obviously, there is a scheme going forward but that is about the future and this is about events in the past.
Q13 Jenny Willott: There are a number of issues raised about the difference between policy decisions made by the Government and administration by the Government as to what is your remit and what is not. It could be looked at that the Financial Assistance Scheme was a policy decision by the Government that showed the extent to which they were prepared to compensate people for the losses and, therefore, by your recommendations you are effectively trying to overturn a government policy decision. How would you defend yourself against that charge?
Ms Abraham: I certainly do not see it that way. I have been very concerned, and it is one of the points, really, about the manner of the Government's response, about the way in which the Government's response has asserted that the report said things and then challenged them when the report never said those things. If you go back to the judge and jury metaphor, it is almost as if not content with wanting to be judge and jury in its own case it also wants to rewrite the judgment and criticise it on the basis of the rewritten version. If you go to the heart of this report, which is all about the official information that was published and the statements that were made, the findings there, I have been told, were unsustainable. Well, I have looked very carefully at the Department's own standards for official information, in terms of accuracy and completeness, clarity and consistency, and I have looked at the official information against those standards. It fails. There is nothing clever or complicated about that, there is nothing technical or actuarial about that; it fails simple tests that the Department set itself. I think, therefore, to come back to your question, the suggestion somehow that I have made assertions, I have entered into territory which is not mine, I simply do not see. On the question of the injustice, the report draws a very clear distinction between the injustice relating to lost opportunities to make informed choices, which I lay very clearly at the door of the maladministration identified in the report. In relation to the financial losses, I say that the maladministration was a significant contributory factor, although other factors were found. I keep coming back to what does the report actually say, not what the Government response is saying that it said.
Q14 Jenny Willott: One of the main issues of dispute with the Government is the fact that the Government says it is going to cost £15 billion to do what you are asking them to do, and that is clearly being disputed by a lot of people. Have you done any estimates about what you think the potential costs of your recommendations are?
Ms Abraham: No, because I do not make recommendations that had any sort of cost to them. Again, if you look at the assertions, the assertions that have been made talk about the causal connection between the leaflets and people's decisions, and then this is Lord Hunt in the Lords: "The Ombudsman's recommendation is that the Government should pay £15 billion over 60 years". I never said that. The report does not say that. The recommendations do not make recommendations of any figures, and I have not done the estimates.
Q15 Jenny Willott: But they do have a price tag attached, even if it does not say what it is. I was just wondering if you have done any work around how much.
Ms Abraham: No, I have not done any work and I am not entirely sure I would say that they do have a price tag because, actually, what the report says is that in terms of the recommendations and in relation to the fact that maladministration was a significant factor amongst the causes of the financial losses, the Government should consider whether it should make arrangements for the restoration of the full pension and non-core benefits promised to all those whom I have identified as fully covered by my recommendations, by whichever means are appropriate, including if necessary by payment from public funds, but there are other funds around. These schemes have funds in them. This report does not say, as has been asserted in, I think, the DWP news release on the day: "For the report to assert that the taxpayer should make good all such losses however they arose is a huge and unsustainable leap of logic". Well, it might have been if I had made it, but actually the only unsustainable leap of logic that I have seen is that it cannot be maladministration if it comes with a high price tag.
Q16 Jenny Willott: Going on from that point, is there a point where the cost of your recommendations are so high that they do, effectively, become a policy announcement?
Ms Abraham: That is an interesting question. I would hope not, but whether it is a policy question or whether it is a question which is properly debated, discussed and decided upon by Government and Parliament - I think that is what I am trying to say here - that, actually, I think the report identifies. I tried very hard to write what I thought was a measured and thoughtful and considered report, and to deliver that in a way which would enable the Government and Parliament to consider the best way forward. So the fact that it has been, I would say, attacked in the way it has and that my findings have been attacked, I think is unfortunate.
Q17 Jenny Willott: Can I ask one final point, which is that one of the issues that could be raised about this is that not everybody - because it is a systemic approach and you were looking at whether in general there was a problem with the system - who has been affected by the loss of their pension has actually been affected by the maladministration and there is not necessarily a link to say that one hundred percent of people who have lost their pensions has actually been as a result of maladministration - and you also make the point in the report. Do you think that that starts then moving across from issues of maladministration into policy and do you think it starts questioning whether or not it is actually in your remit?
Ms Abraham: No, I do not think that, and in all the work that I do I think I try very hard to ensure that I am not crossing boundaries which it would be inappropriate for me to cross. I think, from time to time, I see things where the administrative consequences of a policy are matters that are causing hardship and injustice, or contributing to it, but it is not for me to take a view. I would bring those matters to the attention of Parliament. I think the tax credits report actually did separate quite clearly the issues that I thought were matters of maladministration and issues which had come to my attention which were not for me to take a view on but I thought were properly considered in another place. So I do not think I have strayed into that territory, and I have to say one of the points in this investigation where my own sense of outrage actually was heightened was when I was being told in the Department's response - and as has been said subsequently - that my report failed to demonstrate that the people who had complained to me had actually read or been influenced by the official information that Government had provided. I think, again, it was said in the Lords that there could be no causal connection. I did cover this in the report but maybe I can quote from the report to you today. I said then that the Government had said in its response - this was before the report was published - that the report fails to demonstrate that decisions taken by individual scheme members were directly influenced by government information. What I said in response to that was that chapter two of my report shows that complainants told me that this was the case and many of them provided examples of the leaflets on which they relied. I found no reason to doubt what those people told me and in making this response the Government appears to question both the credibility of the people who have complained to me and my judgment in assessing their credibility. That was at a point where I really did feel that this was not just an attack on my judgment; it was an attack on the honesty and credibility of the people who had complained to me. It did seem to me frankly that those people had gone through enough in losing their pensions without having their integrity attacked by government officials and ministers.
Q18 Jenny Willott: Are you hopeful, from past experience, that the Government may act in time?
Ms Abraham: I do not know. I have been confused as to exactly when we were going to see the final response. Having read back through the statements that have been made from how I read this we have had the final response; we have just not had the full response. That is what is promised so I will wait to see that with interest. There are issues here in relation to the investigation itself and there are issues of principle in relation to the constitutional position of the Ombudsman. Obviously, I would be grateful for the Committee's consideration of those strands.
Q19 Julie Morgan: Do you feel your relationship with the Government is an easier one than people previously had in your position?
Ms Abraham: I have absolutely no way of knowing the answer to that. I do not have an uneasy relationship with the Government. I go back to the whole body of work that my office does and the whole body of relationships that we have. We are working in a range of ways in addition to the cases that we investigate to seek to make the positive contribution to improving public administration and public services that Government says it wants my office to make. We are working with the Cabinet Office and DWP on developing principles of good administration, as I think the Committee knows. I had a very useful, productive and proactive dialogue with the Home Office around the introduction of the Victims' Code, planning for that and thinking about how a joined up approach to complaint handling amongst the criminal justice agencies could most effectively work. I have been talking to the National School of Government about contributing to the top management programme so there is a range of ways in which we have a relationship with government which is positive and is not remotely uneasy.
Q20 Julie Morgan: Do you think you are more challenging, more orientated towards fighting for people's rights, than is normal for someone in your position?
Ms Abraham: It is not my job to fight for people's rights. It is my job to investigate and make decisions on complaints of maladministration and poor service. We are not short of work but I do not see myself as a champion of people's rights any more than I see myself as an apologist for government bodies and the NHS.
Q21 Julie Morgan: I also have a constituency interest with the pension issue because I have a number of constituents who are Allied Steel and Wire pensioners or were connected with them. Over 2,000 people in the Cardiff area have been affected and only a tiny number have had any benefit from the Financial Assistance Scheme so I feel very much that this is a case of injustice and welcome your report. I wondered if you were able to comment on the fact that Amicus and Community are going to the European Court on 1 June about the failures of successive governments, Conservative and Labour, to implement the European Insolvency Directive by 1983.
Ms Abraham: There is very little I can say about that. It was something that, before we commenced the investigation, we looked at to ensure that it did not in any way constrain the investigation of complaints that had been made to me. I had a very clear view and very clear advice at the time that it did not. It is a different tack, if you like.
Q22 Julie Morgan: You were not able to look at that because it was going to the Court?
Ms Abraham: That was not a complaint made to me. The complaints that were made to me were different.
Q23 Julie Morgan: Do you have any view on that action?
Ms Abraham: Absolutely none. I have not looked at it.
Q24 Julie Morgan: You said earlier on that you feel there is a direct link between the maladministration and the losses that people have incurred and that complainants came to you and gave you that sort of evidence. How many people gave you evidence about that?
Ms Abraham: I do not have the numbers immediately to hand. We had 200 complaints. We had four lead complainants and we did a survey of the 200 people and the report has all the detail here. About half the people who responded to the survey were able to quote from or give us copies of the dog-eared leaflets in their files that they showed my team. A substantial number of people were able to show us evidence that they had seen those leaflets and relied on them.
Q25 Julie Morgan: You are able to make a clear link between the maladministration and the losses that people suffered?
Ms Abraham: I would make it clear that again a lot has been said about what the report does not say. I would like to be clear about what it does say. There were a number of illustrations of injustice that we identified. First of all, we talked about the lost opportunities to make informed choices. As a result of relying on information that was produced by government bodies, people had no idea of the risks that there were to their schemes and how reliant they were on the security of the employer. There were lost opportunities to make informed choices about their pension options. Very simply, if you were aware that your pension was only as secure as your employer was, you might not have chosen to put additional, voluntary contributions into the pension scheme. You might have put that money somewhere else. People simply were not aware and could not make those informed choices. We talked about injustice in terms of outrage and distress and then we talked about the hard financial losses in terms of loss of considerable portions of pensions. That is where we said that the Government maladministration was a significant factor amongst others. We did not say it was exclusively the consequence of the maladministration. The fact was that we identified it as a significant contributory factor amongst others. I said very clearly, I thought, in the report that I was not saying that the Government had sole responsibility here. I could not see how the Government could say it had no responsibility here.
Q26 Julie Morgan: You say you do not have any costings for what your recommendations would result in. Do you have any idea of the numbers of people involved?
Ms Abraham: The number of people affected is the 85,000 that has been generally recorded. I did not get into any attempt to cost these recommendations because the recommendation was that Government should take the lead in developing a solution. It was not that the Government should immediately go and write a cheque.
Q27 Julie Morgan: When the Government announced the Financial Assistance Scheme, it did say it would be reviewed fairly shortly. Do you have any idea or any indication when this review will take place?
Ms Abraham: I do not have any information about that.
Q28 Julie Morgan: Do you think that a review could sort out some of these issues?
Ms Abraham: That would depend on the review.
Q29 Paul Flynn: Could I declare an interest? I have a constituency involvement and a member of my immediate family lost his pension in Allied Steel and Wire. Is not the nub of this what you said, that there could be no maladministration if the price tag is too high?
Ms Abraham: I talked about that in terms of an unsustainable leap of logic. It is not my way to bandy around that kind of language.
Q30 Paul Flynn: Do you think, if your report required compensation in thousands rather than billions, you would have had no adverse reaction from Government?
Ms Abraham: The reaction was likely to have been different. I am well aware that there is potentially a high price tag here. I am very aware that when there is a high price tag there is a proper debate to be had about contributions from the public purse in government and Parliament. I have absolutely no difficulty with that. I am a taxpayer like everybody else. What I find very difficult is to be told that my findings and conclusions are unsustainable. I think my findings and conclusions are very straightforward. I suppose I need this Committee to tell me if I have taken leave of my senses but I do not think the report shows that.
Q31 Paul Flynn: After the Maxwell scandal in 1990 the Pensions Act was designed to put that right. I see it was heralded by the Government at that time in 1996 and they said that changes were needed as the Government wanted to remove any worries people had about the safety of their occupational pensions following the Maxwell affair. The minimum funding requirement was intended to make sure that pensions are protected whatever happens to the employer. That seems to be a fairly clear statement made by another government in 1996. Do you think this has affected public opinion and perception of occupational pensions and do you have anything to say about the role that the occupational pension industry put on the Conservative Government to weaken the 1995 Act?
Ms Abraham: I do not think I have anything to say about that specifically. My report has a very detailed chronology of the events which go back before the legislation came in. It is the case, as you identify, that more than one government was involved here. The report, before it goes into the detail of the official information in the leaflets that were published, shows in a preamble to that what the evidence told me about the role Government had taken upon itself in relation to these matters. What I identified is that the design and operation of the legislation and regulatory framework was Government designed; Government promoted the benefits of occupational pension schemes; Government talked about the need for greater financial education. It saw itself as having a key role in promoting better education and inflation about pensions. It said at the time that this official information in these leaflets was aimed to assist people to make informed choices about their pension options. The department in its successive forms set itself standards for official information. It talked about accurate, complete, clear and consistent. It talked about complete meaning containing no significant omissions. Successive governments were not bystanders here. They took it upon themselves to have a role and that is the backdrop to the specific finding of maladministration in relation to the official information I looked at.
Q32 Paul Flynn: If we take the argument that the Government has put forward about the causal link between the advice that was read, is it likely that most people read it in retrospect rather than reading it at the time? With the experience we have on how few people read government advice on this or any other matter, is it not likely that the whole atmosphere then was that occupational pensions were a better deal than personal pensions and you would certainly not get ripped off if you went into them; that the information coming from the pensions industry and from the employers themselves was to build up a feeling of confidence in the system that was not justified? Is it reasonable to blame it all on government leaflets which were read at the time probably by very few people?
Ms Abraham: That is not what people told me. People did produce pretty dog eared copies of leaflets that they had had in files for some time. There are two things I would like to say. One, to bring it down to the hard findings of maladministration about the official information, because that is what the report says led to the injustice. There is lots of other stuff in the report about actuarial decisions and MFRs but it is the official information that I am critical of. I talked about information that was inaccurate and you have quoted the 1996 DSS leaflet which said that pensions are protected whatever happens to the employer. They were not. The leaflets that were incomplete, 1998-2004, posed questions like, "Should I join my employer's scheme? How do I know my money is safe?" They did not say anything about the scheme being only as secure as the employer and they did not mention the risk to pension security on wind-up. How does that pass the no significant omissions test?
Q33 Paul Flynn: What John Hutton said in his parliamentary statement was that the leaflets were general and introductory in nature. They were not a full statement of the law. They made both these points clear. Did they?
Ms Abraham: I do not think they did. I would quote back to DWP its own standards for official information: "Information should be correct and complete" - DWP's own public information policy statement - "Information should be appropriate, relevant, correct, up to date, clear, concise. Any information we provide must be timely, complete and correct." I would also quote back to DWP its own Secretary of State on issues of burden of proof and redress. This is a response to a previous report by one of my predecessors: "The giving of wrong information by government departments is inexcusable. There is a clear responsibility to ensure that the information provided is accurate and complete. As a matter of principle, we believe that when someone loses out because they were given the wrong information by a government department they are entitled to redress." This is not some standard or test that the Ombudsman has dreamed up. This is me assessing the department against the test that it set itself.
Q34 Paul Flynn: There was an absence in these leaflets, I understand, of any suggestion that people should seek any financial advice or give any information that was crucial if they did not want to.
Ms Abraham: The no significant omissions point is the one that hits home for me. If you think about what were the biggest risks in relation to these schemes, the security of the employer and the position of non-pensioners on wind-up were huge risks.
Q35 Paul Flynn: Your recommendations apply to everyone who was in a final salary scheme in the relevant period, regardless of whether they read the leaflet or not. Is that reasonable?
Ms Abraham: I quote the department's own principle back: "We will also provide redress for those people who were wrongly informed and who, had they known the true position, might have made different arrangements." The burden of proof here in past cases has been recognised by government to fall on the government to demonstrate that it had given official information that was complete, correct, clear and consistent. In these circumstances, that is not so. On the point you make about the extent to which redress should be applied here, what is the right solution in these circumstances with these findings of maladministration by the Ombudsman, I have asked Government to consider what should be the solution here. What I find difficult is a response that says, "No, we are not even going to consider that." It is entirely right and proper for government and Parliament to say, "That is all very interesting. The Ombudsman made these findings. We accept that but the recommendations for redress are more than the public purse should properly bear." That is a legitimate decision for government and Parliament. It is not one that I would have anything further to say about. What I am concerned about is a response that says my findings of maladministration are unsustainable as are the tests that I have applied in relation to this official information. What is wholly unreasonable about those tests?
Q36 Paul Flynn: I accept that entirely. Do you think it is reasonable in future, when huge sums of taxpayers' money are involved in this, that the entire responsibility should be taken up by government? There were trustees who were supposed to look after the interests of these pensioners and there were the firms themselves. Most employees did not expect their employers to behave like a bunch of crooks and take their money. Is it right that the government should pick up the tab in every instance and the trustees and the employers get off the hook?
Ms Abraham: The report does not say that.
Q37 Paul Flynn: I am sure it does not but that is the situation surely?
Ms Abraham: I do not see why that should be the case. Some of these schemes have resources. There are issues of law and the structure of the way payments might be paid. There is the issue of annuities. These are not matters for me. In terms of why I thought the government should take the lead here in developing a solution, developing a solution does not mean writing a blank cheque; it means developing a solution. Government can make changes to the law. Government can make changes to the regulatory regime. There is an infrastructure that government has that it can apply. It has collection and enforcement powers. The report never says anywhere, although it has been asserted that it does, that the taxpayer should make good all these losses, however they arose.
Q38 Paul Flynn: The Government has made a final statement on this and they have now promised us a final, final statement.
Ms Abraham: I think it is a full, final statement.
Q39 Paul Flynn: Do you have any inkling what might be in it?
Ms Abraham: I do not know.
Paul Flynn: Were you consulted about the proposals to change the Ombudsman's term of office to an eight year non-renewable one?
Chairman: Can we stay with the pension report for the moment, unless you have established a subtle link between the two?
Q40 Paul Flynn: I think there might be. Do you see yourself staying in office for a sufficient time to make sure that justice is done to the pensioners involved?
Ms Abraham: Might I briefly answer the question because there is a very simple answer to it. Yes, I was consulted and, secondly, it does not affect me personally.
Q41 Mr Prentice: Why do you think the Government has rubbished your report and why did they do it within 24 hours of your report's publication?
Ms Abraham: There are two questions there. In a funny way, I am not sure it has rubbished my report. I think it has rubbished a different report. I was trying to do this all along in relation to the investigation, certainly in the latter stages. I was trying to get the department to address what the report did say rather than attack what it did not say. So far I seem to have singularly failed to do that. That may be something to do with my powers of persuasion. Why so quickly? The response that is in the report which I had from the Permanent Secretary was that they did not want two months to think about it because that would only raise expectations unreasonably and they did not want to do that. Equally, the Secretary of State has said subsequently that the report does deserve a considered and full response so I am waiting for that.
Q42 Mr Prentice: The Secretary of State for Work and Pensions told the House on 16 March that there would be a full response in the next few weeks and I am just wondering what is delaying things.
Ms Abraham: I have no idea.
Q43 Mr Prentice: Why did you not let the Government see the actuarial advice that you relied on in constructing your report?
Ms Abraham: Because I did not rely on it. I had a couple of exchanges with DWP about this and, in a way, I wish I had let them see it now because it still seems to be itching away.
Q44 Mr Prentice: Will you let them see it following this meeting today?
Ms Abraham: I may well because it still seems to be an issue. There is a summary of the advice in the report annexed as a summary. I explained that I wanted some help from an actuarial adviser to help me understand some of the concepts here, to educate and inform me, but there is nothing in the actuarial advice that I rely on in relation to any of my conclusions.
Q45 Mr Prentice: People out there would think it is critically important that you make this information available because the Secretary of State told us on 16 March that the government actuary has advised the Ombudsman that if the advice was not disclosed it made it impossible for anyone to understand the basis on which she reached her conclusion that the Government was guilty of maladministration. It is kind of important that you make this information available, I suggest.
Ms Abraham: With respect, I do not think it is important in terms of the substance. None of my conclusions turn on anything that the actuaries said. At the time, I thought it was a diversionary and delaying tactic and I had no idea what on earth DWP was going to do with my actuary's advice, all 65 pages of it, other than seek to second guess it. If you look at the conclusions, including the conclusions on the decisions to change the MFR basis, those are all findings of maladministration based on process. Nowhere does it say that it was a wrong decision or that the actuaries got it wrong. Frankly, for the government actuary who is in effect an adviser to the body of jurisdiction to advise me anything at this juncture feels a bit strange. I took actuarial advice in order to assist me in understanding the concepts. I did not rely on it at any point in the report.
Q46 Mr Prentice: Reading your report, we all understand the trauma that people have felt. You talk about people committing suicide as a result of all this. I wonder where the responsibility really lies. Paul asked you about the trustees and the Government would say - I use this expression all the time myself - it is a big, nasty, capitalist world out there. The Government cannot be responsible for everything. It is the trustees involved in the individual schemes that are responsible. You say very little about the role of the trustees in your report, notwithstanding the fact that one of your representative cases is a trustee. Why did you not say more about the role of the trustees in monitoring these schemes?
Ms Abraham: I suspect, like me, you will know the circumstances of many of these trustees. Some of them were trade union members. Some were pensioner trustees. In a past life I have been in a situation where the charity that I worked for had its own pension scheme with lay trustees. I was not investigating their role. I was not saying they had no responsibility. A number of the people who complained to me were trustees and they expressed themselves to be similarly confused by, misled by, the government information as were the other scheme members.
Q47 Mr Prentice: The fourth representative complainant was a trade union nominated trustee. You say nothing about the role of the trade unions in your report, so far as I can gather. What were the trade unions at this time advising their members who happened to be trustees of occupational pension schemes?
Ms Abraham: I did not investigate the role of the trade unions or the trustees as such but I think my report does say something about the role that trade unions and trustees could have played if they had not, in the phrase of one of the complainants, been sleep walking into disaster here. I have been on the receiving end of a trade union that made very strong representations about the level of contributions to an occupational pension scheme because of concerns about under-funding. The point here is the ability of scheme members to take that remedial action. That is one of the injustices that I identified in the report. They did not know that there was any need to take those sorts of remedial actions because they had understood that the scheme was safe whatever happens to the employer.
Q48 Mr Prentice: I am a lay person in these matters, grappling. It is very complicated stuff.
Ms Abraham: No, it is not.
Q49 Mr Prentice: Is it not?
Ms Abraham: The subject matter is complicated but the issues are simple.
Q50 Mr Prentice: What about the professional advisers? Were they sleep walking like the trade unions? What were they saying throughout this period? What were the professional trustees doing?
Ms Abraham: They were doing a variety of things. I talked to the actuarial profession because I was very interested to understand what the profession was saying to its members and to government. The actuarial profession did understand the risks, did warn the Government that scheme members and certainly scheme trustees did not understand the risks and made recommendations that action should be taken here, which again is one of the decisions that I looked at. I have not found maladministration in the Government's decision not to take action here, but I think the profession was warning that there was a lack of understanding amongst many trustees. Those warnings were not acted upon.
Q51 Mr Prentice: Is the Government solely responsible for acting upon those recommendations rather than the industry press, if that is what we call it, saying, "Hang on a minute. There is a red light flashing here. We have to take stock and check whether the minimum funding requirement will deliver what the members of any particular scheme believe it will deliver"?
Ms Abraham: No, it would not because it was never the policy intention that it would. I think you go right back to the start.
Q52 Mr Prentice: This is where I take issue because, reading your report, all through your report there are references by government ministers. I have one here: 3 April 2000, Jeff Rooker speaking in the House. He says, "The minimum funding requirement is not a guarantee of solvency. I freely admit that as a lay person I thought it was." He goes on to talk about the perils of relying on the minimum funding requirement as a guarantee that certain benefits were definitely guaranteed to be paid out. That was years and years ago. Why is it that the professional bodies involved did not do anything about it?
Ms Abraham: They did do things about it. If you are talking about the actuarial profession, they warned the Government of the risks. In relation to individual schemes, the scheme actuary would have been providing an evaluation and they would have been looking at that. I have looked at the role of government bodies in this whole situation. My findings are about the role of government bodies. Despite the maladministration I have found in official information, I have not found that these financial losses were the sole responsibility of government. It is very clearly set out in the report, I hope, that there was a variety of factors which contributed to these losses and the government information was one of those. Very simply what the report seeks to say - I had hoped to try to do it in a very measured, considered way, recognising that there were substantial price tags potentially attached to this - to Government was, "You took this role upon yourself. You took upon yourself the role of being the educator, providing official information. You did not have to do that. There is no statutory requirement to do that. You said you would promote these schemes. You cannot say you have no responsibility here and you cannot turn your back on these people."
Q53 Mr Prentice: You were previously chief executive of the Citizens' Advice Bureau that dishes out a million and one leaflets on every subject under the sun. You would not believe any more than I would that every leaflet, whether it is health and safety or some other issue, would purport to be a comprehensive statement of the legal position on an issue of question, would you?
Ms Abraham: I go back to what standards did the department set itself. When I look at complaints and take a view on whether there has been maladministration, my staff will know that there is a gramophone record that repeats itself: what should have happened here? What is our reference point? What is our test for saying that the department, the agency, fell short? My test here is the Government's own standard which was about accurate, complete, no significant omissions, clear and consistent. It failed all those tests.
Q54 Mr Prentice: The Government thought it was being helpful. There is no statutory requirement on the government to publish these leaflets. Admittedly, it had a policy objective about encouraging people to join occupational pension schemes but it was just helping people without giving a definitive statement of what in their case would be right for them regarding their future pensions. That is what the Government is saying.
Ms Abraham: I know what the Government is saying but this is the same Government that took upon itself the role of financial educator and said that it was producing official information to assist people to make informed choices about their pension options and, in doing so, missed out some critical information about the risks to the security of those schemes.
Chairman: If the Government put out a leaflet saying, "We are making the streets safer", described the number of extra police and community support officers and all the anti-crime devices it is putting in and then someone goes out and gets mugged, they cannot run to you, can they, and say, "Look, I read this leaflet. It said that the streets are getting safer. I went out and I got mugged"?
Mr Prentice: I have been delivering these leaflets.
Q55 Chairman: This is maladministration and the Government on the same analogy has also been giving people advice about how to keep their houses safer and fit alarms. Is that not the same kind of thing?
Ms Abraham: If the leaflets you describe had something equivalent in them to "As a matter of principle we believe that when someone loses out because they were given the wrong information by government departments they are entitled to redress", I would look very carefully at that. I have not dreamed up some list of standards for official information that I am now using to beat the department with. I am looking at their own standards and saying they do not meet them.
Q56 Kelvin Hopkins: In reality, this report you made was inevitable given the circumstances. It is not just about money but about politics with a capital P. Your report would inevitably challenge the political spirit of our times, about shifting the state out of our lives because implicitly in your report you are saying - and I agree - bring the state back in.
Ms Abraham: You can read it another way and say take the state back out.
Q57 Kelvin Hopkins: Leave people to their own devices entirely?
Ms Abraham: Once government takes upon itself the introduction of a regulatory regime which is this hands on - I will not go into the minimum funding requirement because it is complex and actuarial - this is complex territory. Once you bring in a regime which is this precise, there are responsibilities that go with that. For example, this is philosophical stuff and it probably is outside my territory so I will be cautious. The priority order on wind-up is what really bites in relation to non-pensioner members. Before the introduction of the priority order, the scheme trustees could have done some balancing. There is only so much in terms of this resource and, "We will look at pensioner members and non-pensioner members". Once you bring in a regulatory regime which is this precise, there are responsibilities that go with it. Once you take upon yourself the role of financial educator, the standard goes up. Making general statements like, "We will just produce a general leaflet and people may or may not read it" - once you have said you are the financial educator - you have to do it to the proper standard.
Q58 Kelvin Hopkins: If we go back in time, the previous government urged people to get out of state occupational schemes and into private pensions, complete madness which proved to be a disaster. Was the 1995 Act a panic reaction when things started to go wrong not just with those private schemes but with the occupational schemes? Could you not say that the writing was on the wall then that they had a dubious future?
Ms Abraham: There are a lot of factors at play here. It is not my place and it will not be helpful for me to speculate on or comment on the history of the pensions industry over the last ten years. This report, although it has been claimed otherwise, seeks very squarely to deal with what is the Ombudsman's business. All of the conclusions and recommendations turn on some very basic findings of maladministration in relation to official information. They do not turn on actuarial advice or MFR decisions. That is my trade and that is what I should comment on.
Q59 Kelvin Hopkins: Without putting any remedies forward, your findings coming at about the same time as the Turner Report throw the whole pensions industry into question and mean Government has to face up to something where they have been driving in the other direction for a long time.
Ms Abraham: That is coincidence and one of a number of things coming together.
Q60 Grant Shapps: It seems to me, apart from the dozen people sitting behind you, probably the people who work in your office, and those of us on this Committee, there is barely anyone else out there who is really interested in your work, perhaps apart also from the people you resolve complaints for. The Government does not really care one way or the other what you are saying, does it?
Ms Abraham: I would go back to the 3,649 other cases that we investigated in the last financial year.
Q61 Grant Shapps: Let us include them but I mean the Government.
Ms Abraham: That is not how it feels from where I am sitting. If we look at tax credits, it seems to me that that was a report that caused quite a stir at the time and in which the Committee took a very welcome, detailed interest. As a result of that report and a continuing dialogue with the Revenue about the recommendations in that report, I think we have worked with the Revenue to help improve the delivery of tax credits for a lot of people. If I look at what we have done on long term funding for continuing care for elderly and disabled people, that is a major area of work for the office over the last three years which has had a huge effect in relation to those people but also has raised the standard of decision making in the NHS in relation to continuing care decisions. I have not had to fight to get the Department of Health and the NHS to listen to me on those issues. After some initial to-ing and fro-ing, the dialogue with the Revenue has been a good one. The dialogue with the Home Office on the Victims' Code has been a good one, so I do not think that is the case.
Q62 Grant Shapps: You have described in one place diversionary, delaying tactics by the Government and you said in another that the Government has responded to a report but it just was not the one that you happened to write. Somewhere else you say they ignored your recommendations and you issued two 10(3)s, even though they are extremely rare in the history of the Ombudsman, and yet despite all of that you are telling this Committee that the Government is listening to the Ombudsman.
Ms Abraham: I think I am saying it is listening most of the time. There are cases that come along from time to time that are difficult, that have a big price tag, that are inevitably going to be difficult. The pensions report is one of them. The Ministry of Defence debt of honour report is a different creature. It would be very interesting to see when Mr Watkins's internal inquiry into how the Ministry of Defence got itself into this situation is available later this year. Out of that I hope will come some very significant learning for the department and perhaps for departments generally about how not to respond to complaints. The way the Minister has responded in that situation with a very clear determination to get to the bottom of this and put it right - he said that to me on a number of occasions - is a very good example of how complaint handling should be done, albeit somewhat late in the day. I always say that I do not expect people never to go wrong; I judge people by what they do in putting things right. The pensions report is big and difficult. I have been disappointed by the Government response, not so much by the fact of it but by the nature of it and partly the fact of it, but I think it is exceptional and extraordinary. It may just be that 10(3)s come along in clusters like these things do sometimes.
Q63 Grant Shapps: Let us talk about your workload because I suppose it is a different indication of how busy you are as an Ombudsman. You mention 3,649 cases from last year. I also note in your report and when you were last in front of us you were looking for a reduction in the number of cases that you were handling. You can either do that by ramping up the number of staff you have working on cases or by the moves that you have now taken which I suggest are about preventing cases getting into your file in the first place. For example, the most recent circulation we have had is that you will kick back tax credit cases to HM Revenue and Customs. It is easy to solve your problem with case work if you close yourself down, is it not?
Ms Abraham: I have said before that my long term aim is to put myself out of business but there is no sign of that yet. You are right. There are a number of ways in which you can reduce the case load. I am pleased to say that, although we have not done quite as well as I had hoped when I talked to the Committee in October, we have managed to get a substantial reduction in the cases in hand at the end of this financial year. All the details of that will come in my annual report to be published in July. We did that even though it went up before it came down. There is a continuing care factor in here which makes it difficult to see these figures in a simple way. In relation to the continuing care work we have looked at thousands of cases since that report was published in February 2003. I believe that it is not the job of my office to be the volume complaint handler for the government and the NHS. Therefore, in the same way as we are having discussions with the Health Care Commission and the Department of Health about this and similarly with the Tax Credits Office, the right place for these disputes and complaints to be resolved is in the front line, quickly, to put things right.
Q64 Grant Shapps: We would all accept that but I put it to you in an area of interest for me, tax credits, that that is not really happening. What is happening is that, now you have closed down yourself as an opportunity to complain about them, instead the complainants go directly back to HMRC. I see no evidence whatsoever that they are handling these cases, in my own constituency's case, any better than they were on 20 October when you came to see us last. In fact, the Public Accounts Committee have said that £2.2 billion was the latest reported over payment which you will no doubt say is before the period that you were talking about. Nonetheless, when you were last here, I tried to suggest to you the system was in disarray. I suggest to you now it remains in disarray. The only difference is that you no longer wish to take on that workload because it rightly should be handled by the department, but it does not mean that the outcome is any better for anybody, does it?
Ms Abraham: The reason that we are sending them back is not because we decided we do not want to do it any more. We still have 300 cases down the road so we still have a volume of tax credits work. What we are saying is that when I talked to you in October I had absolutely no confidence that those complainants were going to get their cases properly dealt with and resolved in the front line; and that we are now at a point - this is what I said in the letter to Members at the end of March - where I am confident that they will be. If that turns out not to be the case, we will be back in there. I have a meeting with the deputy chairman of the Revenue coming up in a couple of weeks when we will review the whole position in relation to those recommendations and the current state of play. We will carry on doing tax credits work as long as it is necessary, in the same way as we have done with continuing care work for the last three years. I think it is right that I should say to government departments - and there is a similar conversation to be had with DWP around Job Centre Plus and Child Support Agency complaints - that it is not the job of the Ombudsman to do their first instance complaint handling for them.
Q65 Kelvin Hopkins: My main point is about challenging government policy and its direction of travel. On the credits system, the merging of revenue collection and benefits administration may not have been a good idea. Year end assessments for tax went very well. The Inland Revenue did a good job and was not generally criticised. As soon as the benefits problem comes in, everything goes wrong and there is deep criticism and problems. That is one challenge. Administering the system correctly may need many more civil servants to get it right so we do not have this ongoing problem of people being overpaid and having to rake it all back. That again would conflict with the Government's intention which is to reduce the number of civil servants. The number of civil servants or the administration might be so expensive as to make it look less attractive even to government. On a whole series of fronts, is it not possible that just by putting out this threat - and you had to do it because you were approached - you have challenged Government and made them less competent in their policies? Is this not part of the problem?
Ms Abraham: I suppose one of my aims should be and I suspect is to make the Government more confident rather than less so. It comes back to learning the lessons of good administration. I come back to the debt of honour case. There are some recommendations in there which are across government about what to do and what not to do when setting up an ex gratia scheme. There is always learning. Policy decisions are for governments to make. All I can do, if there are administrative consequences that flow from those policy decisions, is to point them out.
Q66 Chairman: On the debt of honour, we are making progress with the Government. Your report and our follow-up of your report have worked wonders, but the original complainant in that case, Professor Hayward, has written to me to say, "Thank you very much for making the progress that you have made but my sister," who was interned with him, "is having to spend much of her adult life in the United States. According to what the Government is saying, I shall come under this scheme now but she will not" and yet his point is, "Surely the reason why we are both in the frame is because we were interned, not because of where we subsequently happen to live?"
Ms Abraham: Well, he has not written to me or if he has I have not seen his letter yet. You know what the recommendations in the report were. I think three of them have now been complied with and the fourth one, which is about reconsidering the position of Professor Hayward and those in a similar position to him, is under way. We now have a 20-year residence rule and I can see how that would not work for Professor Hayward's sister. At the moment we have not got the announcement of what the working group is going to do and the eligibility criteria. I understood that was being worked through in the Ministry of Defence in a working group chaired by the minister with input from Mr Bridge. I do not know the detail of what is emerging from that and I do not know what the final eligibility criteria are going to be so I am reluctant to say anything more at this stage.
Q67 Chairman: We shall all keep an eye on this. Can I ask a couple of questions on the pensions report? It seems to me that at the heart of it is the argument about where the liability of the state lies and what the Government has said, in essence, is "it is not our job to underwrite private sector schemes". You have said "but I did not say that", but you said something. What you have said, it seems to me, is that the Government did provide some sort of framework of believed security around those schemes. What I want to ask you is this: when I read Dr Ros Altmann's response to the Government's response to your report, she says, talking about these schemes: "the truth is that the Government interfered with these schemes especially on wind-up so that they were no longer private schemes at all. They became, in essence, state sanctioned and officially approved pension schemes." Is that your view?
Ms Abraham: No, I do not think that is my view, but I think I understand the point she is making and I have tried to make a similar point in terms of the role that Government took upon itself in relation to the legal and the policy framework, the role of educator, the role of promoter, and therefore I would not use that language. I do not think I would agree with that point as it is articulated. I think I said somewhere in my remarks this afternoon that the Government was not a bystander here.
Q68 Chairman: It has to be more than an educator, does it not? The Government tries vainly to educate people about all kinds of things all the time and if it must be held to account for failed educative attempts then, my goodness, it would be in the dock endlessly. It seems to me what you are saying is that it provided a kind of Kitemark for these schemes, which is a very different kind. Did it do that?
Ms Abraham: I think that is right, it did take upon itself a responsibility which was beyond the provision of genuine information, I think that is the point, which is why I said the standard shifts at that point.
Q69 Chairman: I got the impression reading your report and your response to the Government's response that you would not have minded nearly so much if the Government had said, "we think she has got a point but we do not agree with her recommendations". In ombudsman terms, you would have found that much more acceptable, would you not?
Ms Abraham: Yes, I would.
Q70 Chairman: What really irked you was the fact that in rejecting the recommendation, they felt they had to go on and reject your finding of maladministration?
Ms Abraham: I think what really "irked me", if that is the term, were statements like "The Government rejects the findings of maladministration. The Government does not accept that maladministration occurred. The Government does not believe the report makes a sustainable case that maladministration occurred. We cannot accept any of the findings of maladministration". Actually that is interesting but unacceptable from the prisoner in the dock, as it has been described by a Member in Parliament, that actually it is not for governments to reject findings of maladministration. If they want to say that no reasonable ombudsman could have reached these findings and these conclusions, there is a place to say that and it is a court of law. I do not want to spend a lot of time in court responding to judicial reviews by Government, but that is the only place to make that challenge properly it seems to me. I think the other thing that irked me was the comment that, "The report fails to demonstrate that decisions taken by individual scheme members were influenced by the information that Government did or did not make available". That did seem to me to be a serious challenge to my judgment, but more importantly to the credibility of the people who had complained to me. I think that is where, as I said, my sense of outrage was developed. Then, they went on to rewrite the judgment and made all sorts of assertions about things it did not say. All I would expect in these circumstances is an engagement with what the report says and an acceptance that the Government has some responsibility here and it should treat my findings seriously and it should consider my recommendations seriously. So far, I have not seen that. I think Parliament deserves a better response. I think these complainants deserve a better response.
Q71 Chairman: We know that something terrible has happened here. The question is about the balance of responsibility for it as well as the remedy. There is also a reading of recent pension history involved. I wondered if it would be helpful if I, on behalf of the Committee, wrote to Lord Turner and asked him for an observation on this. Would that be helpful, do you think?
Ms Abraham: I think that would be extremely interesting. I cannot see in any way that it would be anything other than helpful.
Chairman: I will do it then.
Q72 Mr Prentice: You managed to bring the Prime Minister into all of this in your report referring to the Ministerial Code, have we not heard enough of that recently, and about the bond of trust between British people and their Government. Then you go on to say that: "citizens should be entitled to expect that the Government does not mislead them". We are on page 167. That is like giving the Government a slap in the face, the Government should not mislead the citizens. My question is this: if this did in fact take place, if people were misled, did the Government do it inadvertently or was it quite deliberate, since you say that they have been misled?
Ms Abraham: I do not think it is giving the Government a slap in the face.
Mr Prentice: That is my way of putting it.
Ms Abraham: I am just doing my job. If you ask me to rehearse a few of the principles of good administration I would say something about giving people information which is complete, correct and not misleading. I think the Department of Work and Pensions' own standard talks about not misleading as a standard. I do not think that it is particularly controversial or an extraordinary thing to say that the Government should not mislead citizens.
Q73 Mr Prentice: It evoked all the stuff about bond of trust and Ministerial Code and so on. The Treasury Committee, looking at your report and the Government's response, have recommended that when the Government gets round to responding in a full and final response to your report, it should set out the published estimates of the costs of the various options for dealing with this issue, including possibly expanding the Financial Assistance Scheme. You would agree with that. My question is, what do you expect of the Government in their full and final report?
Ms Abraham: My reading is it is going to be full. I think it has already been final but we will see. I have only seen and heard what you have seen and heard so I have no inside track on this, I can only wait and see.
Q74 Mr Prentice: We talked about £15 billion earlier, you would expect the level of detail to be that the Government would come forward with all the options for addressing the issue which you have identified.
Ms Abraham: I suppose what I would hope for is that the Government would address what the report does say.
Q75 Chairman: In your memorandum to us relating to the pensions report you say: "this goes to the heart of the ombudsman system and of Parliamentary scrutiny of the executive". Are you telling us that we are in a critical moment in the evolution of the ombudsman system?
Ms Abraham: Well, I suppose I am in a way, but maybe I should go back from that because I always think we are making things so terribly loaded really. I think that there are serious dangers here, not in the debate about recommendations, I would have been astonished if there had not been a debate about the recommendations. I think when government officials in final written responses to me, and to Parliament, say things like, "we reject the ombudsman's findings of maladministration" they have crossed a boundary which needs to be pointed out to them.
Chairman: Thank you very much for that. I think we have had an important and sustained series of exchanges this afternoon. We shall reflect upon what you have told us and we shall reflect on where we need to take it next and I am sure we will see you again before very long. Thank you very much indeed.