Background

Recent media interest in the C&AG's travel and subsistence expenditure have been prompted by a request from Richard Brooks, a journalist with Private Eye, which was submitted to the National Audit Office under the Freedom of Information Act 2000. Mr Brooks requested information under a number of headings and copies of the initial reply and response to a follow up series of questions from him are attached.[1] This information was disclosed as required by the Act and within the statutory timescales.

This briefing note summarises the key information provided and also covers some points that have arisen in the subsequent media coverage.

Spending on travel and subsistence

The travel and subsistence expenditure attributed to the C&AG is not for him alone but also covers his Private Office and his wife on the occasions she accompanies him. For the past three years the figures are as follows:

2004-05  122,937

2005-06  133,978

2006-07   91,086

The purpose of the C&AG's international travel

The C&AG travels abroad on official business of the National Audit Office in connection with their portfolio of international work which generates over £4 million of income each year. A breakdown of visits over the past three years is attached. The NAO's international work takes different forms:

Assistance to emerging democracies - these are technical co-operation projects funded by, for example, the European Union in which the NAO offers assistance in developing the robust public audit systems which are a pre-requisite for membership of the EU. The NAO has been involved in projects in 9 countries.

International development projects - these are projects aimed at improving financial management practices in the developing world where sound governance is a pre-requisite of securing international development funds from the World Bank and other organisations. The NAO has been involved in 49 such projects over the past three years.

International audit - the NAO competes with other state audit offices for the audit of a number of international bodies such as the World Meteorological Office and the World Food Programme. It currently has 23 such audits. In addition, the C&AG may travel in connection with reports to Parliament where fact finding missions to understand overseas comparators and best practice may be called for.

International meetings and bilateral visits - these emanate from the UK's position as a world leader in parliamentary government of which public audit is an important dimension. In this connection the C&AG is invited to speak about our system to officials and politicians in many countries. He also participates in the international organisation of state audit institutions which exists to promote best practice in public audit worldwide.

The arrangements governing the C&AG's travel

Given the C&AG's statutory independence it would not be appropriate for him to seek approval for his travel from Government or the National Audit Office. However, in meeting the cost of the C&AG's travel the National Audit Office would routinely check that all expenditure claimed is supported by evidence of payment, such as hotel bills.

Given his independent position the C&AG is not required to conform to civil service guidance or to the rules governing travel for the NAO. As a proxy he applies the following rules:

The C&AG travels first class for rail travel, business class for short haul flights and first class for long haul flights.

In terms of how this compares to senior Civil Servants or Diplomats, the rules vary between Departments. Some Departments, including the Foreign Office have an entitlement for senior officials to travel first class though we understand that in practice most use first class rail travel and Business Class for air travel.

There is a significant representational and commercial aspect to the C&AG's international work which is not replicated in the Home Civil Service where Permanent Secretaries are the administrative heads of their departments and Ministers fulfil the representational role. Much of the NAO's international work is actively supported by the Foreign Office or the Department for International Development, and in addition to income generated for the NAO, generates other invisible exports.

The C&AG does not extended trips for personal reasons and he stays in a country for 2.5 days on average.

The arrangements governing the choice of hotels

Normal practice is for the C&AG to stay in hotels recommended by the host which will include hotels recommended on earlier visits which proved to be convenient or otherwise suitable. The C&AG stays in a range of hotels and sometimes in the ambassador's residence. Where he stays in hotels the rates paid are often below the advertised figures.

The arrangements covering Lady Bourn

The C&AG undertook 45 visits over the past three years and his wife accompanied him on 24 of those visits. Lady Bourn accompanies the C&AG

on visits where the host would have reasonable expectations that she would attend.

The Cabinet Office guidance covering travel expenses of spouses and partners specifies that responsibility for the decision on whether a spouse can accompany an official rests with the Accounting Officer - in the case of the NAO, that would be the C&AG. Information is not held centrally on the frequency with which this occurs in government departments.

The cost of Lady Bourn's travel for the five years for which the NAO has records is as follows:

2001-02 - 7,432

2002-03 - 18,394

2003-04 - 25,811

2004-05 - 24,969

2005-06 - 25,309

In line with established Cabinet Office guidance (Directory of Civil Service Guidance Volume 2: Collected Guidance - page 53. Travelling Expenses of Spouses and Partners: Use of Official Funds), the NAO also meets the tax and national insurance liability arising. The cost for the years shown above is as follows:

2001-02 - 6,423

2002-03 - 15,924

2003-04 - 22,713

2004-05 - 21,972

2005-06 - 22,272

Lady Bourn accompanied the C&AG on seven trips in 2001-02 which is consistent with the annual average since then. The main difference between 2001-02 and other years was that six out of the seven trips were to European destinations and therefore the costs incurred were substantially less than the average.

The audit arrangements governing the C&AG's travel

The accounts of the NAO, which include the travel and subsistence expenditure of the C&AG are audited by a private sector firm, currently Tenon, which is appointed by the Commission. They are appointed for 3 years. The NAO has always received an unqualified audit opinion.

The impact on the C&AG's domestic role from the amount of travel

The C&AG continues with his normal review of NAO work while travelling.

The Public Accounts Commission sets out clear expectations of the NAO each year in terms of number of audits, number of value for money studies, efficiency savings within the NAO and financial impact across government amounting to savings of over £1.5 billion over the past three years. The NAO has met its targets every year for which Sir John has been C&AG.