Supplementary Memorandum by HM Treasury,
Cabinet Office and Department for Children, Schools and Families
Question 30 (Mr Touhig): Progress
on the extent to which departments provide boards with a monthly
analysis of expenditure by operational target
As the committee has pointed out, only 28% of
departments responding to the survey carried out by the National
Audit Office stated that they were already providing board members
with an analysis of expenditure against operational targets on
a monthly basis. It is not possible to replicate the survey methodology
used by the NAO and provide an updated figure on a consistent
basis in time for this note. However, in the 2007 Comprehensive
Spending Review, both budget allocations and Departmental Strategic
Objectives (DSOs)—departments' high level performance objectives
that these allocations finance—were negotiated and agreed
together, and the clear direction of travel set out in CSR07 is
that departments will be expected to develop and then use robust
methodologies for attributing costs on a full accruals basis to
their DSOs and to their key component outputs. Initial work includes
NAO sponsored pilots in DfID and DIUS. The lessons learnt from
this exercise will help departments develop the right methodologies
for the costing of their own DSOs. The Government is working with
the NAO and pilot departments to ensure that the work of other
departments in this area can be informed by their experience and
a resulting analysis of the lessons to be learnt.
The Government believes that the measures introduced
in CSR07 will ensure that, in future, increasing numbers of departmental
boards will receive fully joined up financial and performance
information on a much more regular basis than now, since departments
will be expected to report to their boards on the basis of such
breakdowns of expenditure. This is crucial for ensuring that decisions
over allocations and the monitoring of costs and performance are
made on a sound basis. The Government welcomes the Committee's
interest in this important area and looks forward to further discussions
during the CSR period.
Question 34 (Mr Touhig): Recent trends in
revenue from asset sales
The Government published public sector receipts
from sales of assets in Table 5.7 of Public Expenditure Statistical
Analyses 2008:
http://www.hm-treasury.gov.uk/economic_data_and_tools/finance_spending_statistics/pes_publications/pespub_pesa08.cfm#pesa
Question 93 (Nigel Griffiths): Cross-Whitehall
agreement that any proposals should include costings agreed by
HMT
A copy of guidance on policy proposals with
expenditure implications is attached to this Memorandum.[13]
This guidance is not new and is taken from a number of currently
published sources such as Managing Public Money and the Consolidated
Budgeting Guidance. This does not reflect an update of the Ministerial
Code.
Question 1l8 (Mr Davidson): Departments' completions
of tier 1 "Finance Skills for All" training
The figures in the following tables show, for
main and smaller departments, the number of online completions
of tier 1 "Finance Skills for All" training up to 1
May 2008, provided through the National School for Government
Management Reporting facility. Each department has access to detailed
information for all those registering and completing the modules.
At the time HM Treasury developed the e-learning modules, the
Ministry of Defence was the only department with its own tier
1 e-based resource management learning system of an equivalent
level to that developed by the Treasury. The numbers for the MoD
equivalent (Certificate in Resource Management) are shown for
completeness. HM Treasury does not have information on equivalent
tier 1 training that may have been developed subsequently.
FINANCE SKILLS FOR ALL COMPLETED
FOUNDATION UP
TO 1 MAY
2008 Main Departments
Department Name
| Completions | SCS | Grade 6/7
| Others |
Cabinet Office | 2
| 0 | 1 | 1 |
| Department for Communities and Local Government
| 24 | 1 | 8
| 15 |
| Department for Culture, Media and Sport |
6 | 0 | 3 | 3
|
| Department for Children, Schools and Families
| 1 | 0 | 0 |
1 |
| Department for Education and Skills* | 52
| 4 | 17 | 31
|
| Department for Environment, Food and Rural Affairs
| 31 | 2 | 10
| 19 |
| Department for International Development |
10 | 2 | 2 |
6 |
| Department for Transport | 327
| 140 | 129 | 58
|
| Department for Work and Pensions | 55
| 4 | 10 | 41
|
| Department of Health | 30 |
2 | 8 | 20 |
| Department for Business, Enterprise and Regulatory Reform
| 1 | 0 | 1 |
0 |
| Department for Innovation, University and Skills
| 0 | 0 | 0 |
0 |
| Department of Trade and Industry* | 42
| 6 | 27 | 9
|
| Foreign and Commonwealth Office | 115
| 26 | 46 | 43
|
| HM Revenue & Customs | 20
| 3 | 4 | 13
|
| HM Treasury | 27 | 3
| 9 | 15 |
| Home Office | 22 | 2
| 8 | 12 |
| Ministry of Defence | 6 |
0 | 0 | 6 |
| Ministry of Defence (Certificate in Resource Management)
| 7,029 | 132 | 704
| 6,193 |
| Ministry of Justice | 19 |
1 | 6 | 12 |
| Northern Ireland Office | 14
| 1 | 5 | 8 |
* These figures are pre July 2007 Machinery of Government changes.
| | | |
|
FINANCE SKILLS FOR ALL COMPLETED
FOUNDATION UP
TO 1 MAY
2008 Smaller Departments
| Department Name | Completions
| SCS | Grade 6/7
| Others |
| | |
| |
| | |
| |
| Assets Recovery Agency | 1 |
0 | 0 | 1 |
| Central Office of lnformation | 0
| 0 | 0 | 0 |
| Charity Commission | 0 |
0 | 0 | 0 |
| ECGD | 0 | 0
| 0 | 0 |
| Food Standards Agency | 9 |
0 | 1 | 8 |
| Government Actuaries Department | 0
| 0 | 0 | 0 |
| Government Communications Headquarters—GCHQ
| 57 | 12 | 27
| 18 |
| Health & Safety Executive | 1
| 0 | 0 | 1 |
| Land Registry | 1 | 0
| 0 | 1 |
| Legal Secretariat to the Law Officers |
1 | 0 | 0 | 1
|
| National Archives | 0 |
0 | 0 | 0 |
| National Savings and Investments | 0
| 0 | 0 | 0 |
| National School of Government | 3
| 1 | 1 | 1 |
| Office for National Statistics | 11
| 2 | 4 | 5 |
| Office of Fair Trading | 0 |
0 | 0 | 0 |
| Office of Her Majesty's Chief Inspector Schools (OFSTED)
| 5 | 1 | 0 |
4 |
| Office of the Parliamentary Commissioner for Administration and Health Service Commissioner for England
| 1 | 1 | 0 |
0 |
| Office of the Rail Regulator | 1
| 0 | 1 | 0 |
| OFGEM | 0 | 0
| 0 | 0 |
| Ordnance Survey | 0 | 0
| 0 | 0 |
| Postal Service Commission | 1
| 0 | 1 | 0 |
| Revenue and Customs Prosecution Office |
0 | 0 | 0 | 0
|
| Royal Mint | 1 | 0
| 0 | 1 |
| Serious Fraud Office | 1 |
0 | 1 | 0 |
| The Crown Prosecution Service | 6
| 0 | 4 | 2 |
| Treasury Solicitor's Dept | 36
| 2 | 17 | 17
|
| UK Trade & Investment | 4
| 0 | 0 | 4 |
| Water Service Regulation Authority | 0
| 0 | 0 | 0 |
Questions 127-8 (Mr Davidson): What is the educational
background of the top 20 civil servants in HM Treasury, what is
the Treasury doing to increase diversity and is this being successful?
The Treasury does not routinely hold this information for
individual members of staff. Disclosure of this information is
a matter for the individual concerned.
The following information is available in relation to the
Executive Members of the Treasury Board.
Nicholas Macpherson | BA, Philosophy, Politics and Economics, Oxford; MSc Economics, University College, London
|
John Kingman | BA Modem History, Oxford, World Fellow, Yale 2004
|
Dave Ramsden | BA Economics and Politics, Oxford; MSc Economics, LSE
|
Mark Neale | BA, Modem History, Oxford
|
Tom Scholar | MA History, Cambridge; MSc Economics, LSE
|
Stephen Pickford | BA Economics, Cambridge; MA Economics, University of British Columbia
|
Louise Tulett | ClPFA, 1989, Southampton IHE
|
Nigel Smith | BA Business, Bristol Polytechnic; General Management Course 120, Henley Management College
|
| |
Over the past 3 years, 2005 to 2008, the Treasury has actively
participated in the Cabinet Office's 10 Point Plan on Diversity
which committed all Whitehall departments to tackling the under-representation
of women, people from ethnic minority background and people with
disabilities in the Senior Civil Service and feeder grades.
We have made some good progress on improving the diversity
of the feeder grades (Range D and E) in particular. This will
ensure there is a pipeline of talent that will feed into the SCS
over the next few years and thereby improve the diversity of the
SCS. However, the number of employees in the SCS is small (109
people as at April 2008), so the movement of one or two individuals
can have a disproportionate impact upon progress towards meeting
the targets:
— As at 31 March 2008 women made up 36.0% of range
Es and 41.6% of Range Ds and the Treasury is on track to meet
targets of 40% at each grade. Women made up 34.9% of the SCS (target
37%) with women in 20% of top management posts.
— The proportion of staff from ethnic minority backgrounds
is 6.4% (target 14%) at Range E and 2.8% in the SCS (target 4%).
However we have already passed our target (of 14%) for the representation
of people from ethnic minority backgrounds at Range D (now 15.8%
March 2008).
— There has been some very encouraging progress
on the representation of disabled people in the feeder grades
(this may be due partly to the improved recording procedures that
have been put in place in the last year). The target is 5% and
at March 2008 the representation of disabled people at range E
is 4.4% and at range D 4.6%. Disabled people made up 1.8% of staff
in the SCS (target 3.2%).
The Treasury is seeking to address under representation in
a number of ways including:
— Developing stronger links to Universities with
Diverse Student Populations Outreach.
— Launching a Diversity Tool Kit.
— Mentoring women in the SCS.
— Promoting diversity awareness through a series
ofevents and networks.
— Closer working with Other Govenunent Departments'
Diversity Groups.
— Mainstreaming diversity.
Question 129 (Mr Davidson) and Question 138. (Chairman): How
many senior civil servants have left the civil service as a result
of poor performance, including any instances where people have
gone as a result of PAC pressure?
The process of managing out poor performers is necessarily
a sensitive one. In many cases, poor performers will choose to
resign and pursue careers elsewhere rather than be dismissed.
For that reason data is limited. However, the Office for National
Statistics collects aggregate data on civil service leavers and
dismissals. Between 2003 and 2005, 2,560 civil servants were dismissed
on grounds of "inefficiency", representing 2.6% of the
total population of leavers during that period.
In the case of the senior civil service (SCS), if we look
at the correlation between performance and leavers, proportionately
more poor performers at SCS level left the civil service than
those in other performance tranches. In 2007, 6% of SCS were considered
to have significant development needs, 17% of those who resigned
are known to have been from this performance tranche. Steps have
also been taken to improve performance at the departmental level.
For example, the Home Office has undergone significant changes
to its leadership in recent times. In his evidence to the Public
Administration Select Committee in November 2007, the Cabinet
Secretary noted that 28 of the 50 directors within the Home Office
were new and that there had been 17 exits.
We do not have information on the impact of the PAC on resignations
or career progression of senior staff.
Questions 143-5 (Mr Dunne): Does the Treasury receive the
monthly board pack submitted to the Olympics board, and what is
the Treasury's assessment of the quality of the financial information?
The Chancellor of the Exchequer is Chair of the Ministerial
Funders Group, which is responsible for controlling access to
the contingency funding available. As such, on behalf of the Chancellor
of the Exchequer, Treasury officials are party to all discussions
on managing the public sector funding package for the Olympics.
HM Treasury receives monthly financial and project information
from the Olympic Delivery Authority (ODA) and regularly discusses
the position with the Government Olympic Executive (GOE) in DCMS,
which acts as client on behalf of the Government. HM Treasury
is also heavily involved in the process of quarterly review of
the programme's financial position, risk assessment and delivery
performance, which the GOE leads on behalf of government. This
process forms the basis of the information that is made available
to inform Parliament and the public on progress of the Olympics,
through, for example, the GOE Annual Report and the half-yearly
updates and quarterly briefings provided to opposition Spokesmen
and Committee Chairs by the GOE.
The financial information provided by the ODA supported the
agreement of the DCMS Main Estimate submitted to Parliament for
the last financial year. Since that time, detailed cash flow estimates
have been developed and agreements are in place between all of
the funders of the Olympics, supported by HM Treasury, to ensure
the funding available matches the projected profile of spend.
GOE and HM Treasury continue to work with ODA to improve information
further. To support this, Treasury officials hosted a half-day
training for ODA and GOE officials covering public spending and
financial management disciplines as applied in government. GOE
are holding a workshop on ODA reporting to drive further improvement,
in which HM Treasury will actively participate.
Questions 146-8 (Mr Dunne): What is the average time spent
in post in HM Treasury, and the average time spent in HM Treasury?
As of 31 March 2008, staff have, on average, been in their
current posts for 1.6 years. This includes staff on time-limited
loans and secondments to the Treasury. Current employees have
been in the Treasury on average for 6.4 years.
Questions 149-150. (Mr Dunne): Which Treasury officials
have prior banking experience?
Nicholas Macpherson, Pennanent Secretary, worked on the Barings
Bank crisis and resolution, as Principal Private Secretary to
the Rt Hon Kenneth Clarke QC MP, in 1995.
MANAGING DIRECTORS
— John Kingman, Second Permanent Secretary, and
Managing Director of Public Services and Growth, was an Executive
Director of the European Investment Bank from 2003-06. He also
wrote extensively on banking sector issues for the Financial Times
Lex column.
— Stephen Pickford, Managing Director of International
Finance, was an Executive Director of the World Bank from 1998-2001
and has been a Director of the European Investment Back since
2007.
— Tom Scholar is a Non Executive Director of Northern
Rock and was an Executive Director of the World Bank from 2001
to 2007.
FINANCIAL SERVICES/NORTHERN
ROCK TEAM
Experience in the Financial Services/Northem Rock Team includes:
— a Senior Civil Servant who worked for three years
in the City for Natwest and Prudential Groups (including a period
working for Egg) and as a consultant for HBOS Group 2; and
— a Senior Civil Servant who worked for two years
as an economist in fund management, plus 12 years as an economist
covering fixed income and currency markets in investment banking.
Staff experience in the broader International Finance and
Macroeconomics and Fiscal Policy Directorates includes:.
— a former Managing Director of the Deutsche Bank
Group;
— a current Alternate Director of the European Bank
for Reconstruction and Development; and
— a Qualified Chartered Accountant with over 15
years of post-qualification banking experience prior to joining
the Treasury, including five years as Finance Director of Close
Brothers Ltd.2
Questions l51-2 (Mr Dunne): Have any current Treasury Ministers
attended a financial risk seminar?
Two of the Ministers who attended a financial and risk seminar
in April 2006 are now Treasury Ministers.
Question 156 (Mr Williams): What is the Treasury's approach
to accreditation of financial management training courses?
HM Treasury has a light touch approach on accreditation.
This is because the tier 1-3 training material is available free
of charge to all departments and tier 2-3 is also freely available
to external providers of finance training to departments. In addition,
HM Treasury has specified the 22 knowledge traits which underpin
the Professional Skills for Government core finance skills. Again,
these knowledge traits are freely available and should be used
in the design of finance based training. Departments are encouraged
to use the training material and adapt it to meet the specific
needs of their departments by, for example, substituting case
studies with real life departmental examples. The National School
of Government updates the tier 1-2 material on an annual basis
and provides on-going quality assurance of content. For practical
reasons, only the tier 1-3 material is endorsed by the Head of
the Government Finance Profession, as it was specifically commissioned
by the Cabinet Office.
Question 171 (Mr Bacon): Why is financial management not a
mandatory element of the performance framework for the whole of
the SCS, and will the guidance be updated to make financial management
a mandatory element?
All permanent secretaries have agreed to apply a single,
common performance management framework across the senior civil
service (SCS). The framework sets out what is expected from departments,
it is mandatory in its effect. The framework and assessment process
is detailed in the Cabinet Office document "Performance Management
Guidance 2008". The Guidance allows departments limited discretion
to reflect the particular challenges they face—for example,
if a department is placing a particular focus on improving the
quality of its financial management or leadership, it may want
to emphasise this in the overall assessment process. The guidance
also allows limited flexibility at the individual level. For example,
in the case of financial management, it may be inappropriate to
place a significant focus on performance or capability in this
area if an individual does not have financial responsibilities.
A bank and authorised under the Financial Services and Markets
Act 2004. It is regulated by the Financial Services Authority
and is the parent company of a group providing a range of banking
services including specialist financing, asset financing, treasury
and deposit taking. Close Brothers Ltd is wholly owned by Close
Brothers Group plc which itself is listed on the London Stock
Exchange.
13
Not printed here. Back
| 
