House of Commons - Public Administration

Select Committee on Public Administration Sixth Report

4 Wider constitutional issues

59. Government's official manual, Government Accounting states:

In the light of the investigation of a case, the Parliamentary Ombudsman will decide whether complainants have suffered injustice because of maladministration; and whether any injustice has been, or will be, remedied. The Parliamentary Ombudsman's findings on maladministration are final; there is no established avenue of appeal.[69]

There have been occasions when government has resisted the Ombudsman's findings and recommendations, but these have been extremely rare. The Secretary of State told us:

We have nothing but respect for the work of the Ombudsman. In the last year she looked at something like 600 cases involving the Department for Work and Pensions and we accepted every single one of her recommendations in those cases.[70]

Nevertheless, we have been increasingly concerned at the possibility that the Government has been treating the Ombudsman's reports less seriously than it should, and has been too eager to contest them.

60. As we said at the outset, this is only the fourth time that a report has been laid under section 10(3) of the Parliamentary Commissioner Act. The first occasion was in Session 1977-78, and concerned the Department of Transport's refusal to meet late claims for compensation. The second was in session 1994-95, and related to the refusal of the Department of Transport (once again) to accept that it had acted maladministratively in dealing with extreme hardship caused by blight which was exacerbated by delay in determining the route of the Channel Tunnel Rail Link. In both cases, the Government of the day ultimately agreed to compensate complainants.

61. The third case arose earlier this session, when the Ombudsman laid a report A Debt of Honour, dealing with ex-gratia payments to former civilian internees in the Far East. We have examined both the section 10(3) reports laid this session. We took the same approach in investigating the earlier report as we have done to this. We cannot (and would not expect to) replicate the Ombudsman's investigations, and we are confident in the evidence she assembles, which is also revealed to the Government. This does not mean that we automatically accept her findings without making our own assessment of the Ombudsman's report, the Government's response and the other evidence available. Our approach is to test the Ombudsman's contentions thoroughly.

62. As our analysis of the pensions report above shows, we consider the Ombudsman's findings in that instance were well founded. In the case of the Debt of Honour report our investigation led the MoD itself to discover that the Ombudsman had been correct in suggesting that cases had been decided inconsistently, and reasonable in recommending that there should be a review. We concluded that "there is ample evidence to support the Ombudsman's finding of maladministration."[71]

63. Even before these two reports, there were signs that the Government's relationship with the Ombudsman was changing. Although HM Revenue and Customs did not formally dispute the Ombudsman's findings in relation to Tax Credits, on 12 October 2005 Mr David Varney, its Chairman, told the Treasury Sub-Committee "We do not see it [automatic recovery of over payments] as a case of maladministration and I have written to the Ombudsman saying that".[72] The Ombudsman told us:

… I have read Mr Varney's evidence to the Treasury Sub-Committee last week and I am still unclear about the Revenue's position in terms of my findings in that report and we are in discussions. There are some very clear and direct statements made, but, in dialogue with the Revenue, I am not sure that the situation is entirely clear.[73]

We understand that she remains in dialogue with the Revenue about her recommendations.

64. The Ombudsman has been extremely measured in her response to these developments. In her memorandum to the Committee in October 2005, she simply drew attention to the Government's rejection of the key findings in the Debt of Honour report.[74] In oral evidence on 20 October she was asked about whether there was "growing resistance from the Government in terms of accepting these recommendations". She responded:

I think the Debt of Honour report is highly exceptional. That is one of the reasons I laid it before Parliament. In my memorandum I have invited the Committee to reflect on the Government's response because I think constitutionally it is significant and it is highly exceptional.[75]

We ourselves raised the issues again on 1 December, when we asked whether the Ombudsman thought that "over the years there has been a falling off in the way that governments have seen your recommendations?" Once again, the Ombudsman told us she saw the problem as an isolated incident:

I do not see in this a determined attempt by government to resist the Ombudsman or to show disrespect for the Office. I would say in all seriousness that in all the work we do we see huge respect for the Office across government and in Parliament.[76]

65. The Ombudsman's initial memorandum before we took evidence on the Government response to Trusting in the pensions promise had raised concerns that:

it is entirely inappropriate, within a system of scrutiny of the way in which public bodies deal with citizens, for those whose actions are subject to such scrutiny to seek to over-ride the judgment of the independent arbiter established by Parliament to act on its behalf—and for the Department for Work and Pensions' response to be merely to say that it does not accept that judgment.

This goes to the heart of the Ombudsman system—and of parliamentary scrutiny of the executive—and is a matter on which the Committee may wish to reflect.[77]

However, when we took oral evidence on 2 May, she was still reluctant to consider that the DWP's response was part of a wider malaise:

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. … there is a range of ways in which we have a relationship with government which is positive and is not remotely uneasy.[78]

When challenged on whether the Government was listening to the Ombudsman, she responded:

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. … 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.[79]

66. It is clear from this that the Ombudsman does not assert that Government is challenging her constitutional position lightly. Indeed, as this history of our questioning shows, this Committee was concerned even before the Ombudsman made any complaint. We therefore take it extremely seriously that the Ombudsman has now told us:

12. There appears to be an emerging attitude amongst Government departments that they can properly, and with impunity, reject my independent assessment of their actions, and my findings of maladministration.

13. As the Committee knows, the Chairman of Her Majesty's Revenue and Customs told another Parliamentary Committee that he did not accept my judgement that maladministration had occurred in relation to the administration of tax credits.

14. The Permanent Secretary of the Home Office has recently informed me that he does not accept my findings of maladministration in relation to a number of immigration cases.

15. It would appear that DWP's response to this report has given permission for a wider pattern of behaviour to develop. If this becomes a general pattern, or a culture, I am sure the Committee will agree that this can only undermine the confidence and credibility that is necessary to ensure that the Ombudsman's office can fulfil its role and purpose.[80]

67. We share the Ombudsman's concerns. It is not unprecedented for governments to reject findings of maladministration. However, it is extremely rare. Moreover, precedent has shown that, even when departments have denied that maladministration has occurred, they have ultimately been willing to offer some recompense out of respect for the Ombudsman's office. The series of rejections of Ombudsman's reports is deeply troubling. This is the more so since such responses are not decided by departments on their own, but are raised in discussion across Government.[81]

68. We also consider that this series of rejections of Ombudsman's reports has been taken in a way which suggests the Government is paying only lip service to the principle that the Ombudsman's findings should be respected. In preparing for our evidence session, the officials involved in the ex-gratia scheme for former civilian internees met face-to-face. This was apparently all that was needed for it to become clear that decisions had not been taken consistently. If the Ministry of Defence had taken the Ombudsman's report as seriously as it took our evidence session, rather than brushing aside her calls for a review, it would have realised its error much sooner. Similarly, despite DWP's avowed respect for the Ombudsman, its response to the pensions report was initially dismissive. On 15 March, the day the Ombudsman's report was published, it produced a written Ministerial Statement, and a Press Release in which the then Minister for Pensions, Stephen Timms MP was quoted as saying:

We have studied the report carefully but we reject its findings of maladministration. It simply does not make the case.

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.[82]

As we have seen, the assertion that the taxpayer should make good all such losses is nowhere in the report. The day after this initial statement, the Secretary of State made an oral statement in the House, when he announced that: "The Parliamentary Commissioner's report is a detailed piece of work and, of course, deserves a proper, full and formal response. It is my intention to publish such a response in the next few weeks."[83] We understand the Government's desire not to raise false hopes among complainants, but its handling of the response caused outrage. The Ombudsman herself told us:

That a full and proper response to my report, including an assessment of what full redress might cost and analysis of a range of ways of raising those costs, would take some time is not a surprise to me—and I do not criticise the Department for Work and Pensions for taking approximately two months to complete this.

However, it is a matter of regret that this was not recognised by the Department for Work and Pensions when my report was published and when I offered them such a period in which to reflect on my report—and that, instead, it gave an immediate response, making claims that cannot be sustained as to what I had found and recommended and what that might cost.[84]

Mr Parr told us that what upset him most about the response was:

the fact that there was no discussion of it. It was a foregone conclusion. It took, I seem to remember, about three minutes in the House, and that was all that was said about it. I expected at least there to be some debate and some batting the issue back and to, but it just vanished.[85]

The way in which the Government responded to the Ombudsman's report caused needless offence. It would have been possible to respond speedily in a way which managed complainants' expectations without this.

Conclusion

69. Throughout our discussions with the Ombudsman she has shown a willingness to distinguish between findings of maladministration, and recommendations about redress. While the Ombudsman does not make recommendations lightly, it is clear that she understands that the Government may:

reject recommendations that I may make, after proper consideration of the public interest, and other calls on the public purse, and any other relevant matters. That is a decision that it is entitled to take, was one envisaged by Parliament when it decided that I would not have powers to make binding recommendations, and would be one for which the relevant Department would have to account to Parliament.[86]

We believe that such rejections should be rare, but what causes the Ombudsman, and us, most concern, is the Government's increasing willingness not just to dispute her recommendations, but her findings of maladministration as well.

70. It is not unprecedented for the Government to contest an Ombudsman's finding of maladministration. It is, however, unprecedented for there to be so many problems, in such a short space of time. Our scrutiny leads us to conclude that the fault lies with the Government, not the Ombudsman.

71. The Ombudsman told us:

the Department for Work and Pensions (DWP) continues to assert that it can be the final arbiter of complaints about its own actions. As the Committee will understand, this position goes to the heart of the system of independent scrutiny of executive action that Parliament has established; and to the confidence that citizens can have that they will receive an effective scrutiny of and outcome to their complaints.[87]

We agree that if the Government routinely rejects the Ombudsman's findings without good cause, public confidence in the system will be undermined. The Government has recently been too ready simply to reject findings of maladministration, apparently without proper study of the Ombudsman's reports.

72. We understand the Government may face presentational difficulties if it accepts a finding of maladministration, but rejects recommendations for redress. However, we believe it should look at the Ombudsman's findings without considering the potential costs of recompense. The Ombudsman considers that "it is inappropriate for a body under investigation to seek to override the judgement of the independent arbiter established by Parliament to act on its behalf."[88] Her advice to the DWP was robust: "it is maladministration, get over it and let us get on to engagement with the real issues here".[89] In both the cases we have examined this year, the Government would have done far better to have accepted the Ombudsman's findings and, in consequence, to have considered her recommendations properly. Rather than spending time and effort on defending their position, Departments would then have been able to discuss what remedies could practically have been offered. At the heart of every case of maladministration is someone who has suffered injustice. By concentrating its energy on denying findings of maladministration, rather than by considering what remedies might be practical and proportionate, the Government has caused further distress to complainants. It has delayed any resolution of their problems. We hope now that the Government will engage with the Ombudsman positively, and start from the presumption that it is her job to determine whether or not maladministration has occurred, not its own.

73. As the Ombudsman said:

there is an important constitutional point here. I think it is my job to determine maladministration. If I make a finding which is wholly unreasonable that no reasonable ombudsman can make, and people have, complainants have challenged that in the High Court. Now, I am not suggesting for a moment that we should all toddle off to the High Court on these issues, but seems to me that there is a starting presumption that the Ombudsman knows her job and if I say that there is maladministration, I have not reached that view lightly and I do not expect the Government or permanent secretaries to say, "We don't agree" and walk away. They can argue with me, of course they can, and I may not be right and this Committee may take the view that I have done something completely off the wall. … but I think the place for those discussions is not in the Government or in the NHS where the Government somehow decides to pick and choose which of my findings it likes. There is an important constitutional principle here, it seems to me. This is Parliament's Ombudsman and I am here for a purpose.[90]

74. In its response to the Ombudsman's report, the Government notes:

The Ombudsman has investigated the complaints put to her in line with the Parliamentary Commissioner Act and has reached a view that an injustice arose from what she considered to be maladministration. She has quite properly reported her findings to Parliament. In the same way, the Government has reported to Parliament why it cannot accept them. It has been suggested that the Government's course of action might be to have the Ombudsman's opinion judicially reviewed, but the Government considers that the proper approach in such a situation is to provide its response to Parliament.[91]

The Government may be reluctant to use judicial review to resolve its differences with the Ombudsman, but an application for judicial review of the Government's own decision to reject the Ombudsman's findings has been made by four of those affected by the wind up of their pension schemes.[92]

75. There are precedents for complainants asking the court to review an Ombudsman's decision, but no such precedent for a judicial review brought by Government. The Parliamentary Commissioner Act was established to deal with maladministration; ie, actions or failures which cannot be remedied in the courts for either legal or practical reasons, but which nevertheless cause injustice. To ask a court to review the Ombudsman's findings would effectively make matters which are currently not justiciable subject to judicial decision. In these circumstances Parliament's role would be diminished to that of an interested bystander. We believe that when there are disputes between Government and the Ombudsman, Parliament is the proper place for them to be debated.

76. However, this system will only work if the Parliamentary Ombudsman, the Government and Parliament share a broad common understanding of what maladministration might be and who should properly identify it. If it became clear that the Government routinely considered rejection of a finding of maladministration, then that common understanding would no longer exist. The first step towards resolving such difficulties would be for the House to debate these matters. However, if that failed, new legislation might be needed, or the Government could attempt to use judicial review to establish where current boundaries lie. We hope it will not come to that.

77. The Ombudsman's Office is currently working to establish principles of good administration, which she hopes "will be endorsed by all those who are responsible for both public service delivery and for formulating the policies which underpin those services."[93] This work may diminish some of the differences we have seen this year. We will scrutinise its development and its reception by those responsible for delivering services and formulating policy.

78. We share the Ombudsman's concern that the Government has been far too ready to dismiss her findings of maladministration. Our investigations have shown that these findings were sound. It would be extremely damaging if Government became accustomed simply to reject findings of maladministration, especially if an investigation by this Committee proved there was indeed a case to answer. It would raise fundamental constitutional issues about the position of the Ombudsman and the relationship between Parliament and the Executive.

79. We trust that this Report will act as a warning to the Government. We will continue to monitor the Government's responses to the Parliamentary Commissioner's reports. If necessary we will seek a debate on the floor of the House, so that all Members can discuss these issues, and re-establish the Parliamentary Commissioner's role. The Parliamentary Commissioner is Parliament's Ombudsman: Government must respect her.

69 Government Accounting, Annex 18.1, para 5 Back

70 Q 136 Back

71 First Report of Session 2005-06, A Debt of Honour, HC 735, para 37 Back

72 Minutes of Evidence Taken before the Treasury Committee (Treasury Sub-Committee) HM Revenue & Customs: Spring Departmental Report , Wednesday 12 October 2005, HC 524-ii Back

73 Second Report of Session 2005-06, Tax Credits: putting things right, HC 577, Q 10 Back

74 HC(2005-06)577, Ev 3 Back

75 HC(2005-06)577, Q 10 Back

76 HC(2005-06)735, Q 2 Back

77 Ev 52 Back

78 Q 19 Back

79 Q 62 Back

80 Ev 54 Back