Examination of Witnesses (Questions 120-139)
MR DAVID
GREEN QC
21 MAY 2008
Q120 Mr Davidson: I do not doubt
that you take it seriously but what I want to be clear about is
whether or not the Government is taking it sufficiently seriously
in order to make those changes in legislation. You mentioned the
question of divorce proceedings and houses and so on, have rules
now been devised which would overcome that as a blocking mechanism?
Mr Green: No, not yet, that is
something we have reported up as something we have started to
encounter. Obviously one reacts to stimuli like that and we have
reported that up, we have discussed it with our colleagues in
the Crown Prosecution Service and the Serious Fraud Office and
it is something that I am quite sure will be dealt with in due
course. You cannot change these things overnight, I well recognise
that.
Q121 Chairman: Did you have to take
a big pay cut when you left the private sector to join the public
sector?
Mr Green: There were other consolations,
Chairman.
Q122 Chairman: What were the other
consolations apart from appearing before the Committee of Public
Accounts?
Mr Green: For me it is an enormous
privilege to actually lead a new organisation. Obviously there
are other consolations like pension arrangements and so forth
which, taken into account, I am not making a fuss.
Q123 Chairman: It is perfectly proper
to say that you want to work for the public sector and get consolation
from that but the serious part of this question is that at the
top end, given the rewards that there are at the private Bar as
we were discussing, are you attracting top people to your organisation?
Mr Green: Chairman, if I can give
you this example from, admittedly, the lower end of the profession,
we advertised for a junior grade 7 lawyer last week and we had
97 applications, at least 22 from the Bar. This is because there
is actually a cold wind blowing through the criminal Bar as you
know.
Q124 Chairman: We read about that.
Mr Green: Indeed, for various
reasons. I personally do not think there has been any shortage
of applicants for government bodies, not in my experience.
Q125 Mr Bacon: Going back to Mr Partridge
for a second, why was he the best candidate to be the Chief Operating
Officer? Did you interview him?
Mr Green: I interviewed him together
with two other experienced senior civil servants, both senior
to him, and we interviewed three candidates. He came well-recommended
from the Senior Fraud Office and I indeed had interviewed him
at the Serious Fraud Office the year before with his SFO director
and another person for a job that he did not actually get, but
I have to say I was impressed by him. He seemed to me a can-do
person and, in fairness to Mr Partridge I do emphasise that, like
his wife, he did a very good job, looking back. I came to this
job as I said after 25 years at the criminal Bar, he came with
40 years experience in the civil service and I would like to think
that with an obvious exception he complemented what I was able
to bring to the party.
Q126 Mr Bacon: You are a very articulate
and impressive witness and we would I suppose expect no less from
a QC.
Mr Green: You are very kind, Mr
Bacon.
Q127 Mr Bacon: Kind and funny, that
is two big compliments in one afternoon; I am not sure I can take
much more—I can assure you that witnesses are not normally
that nice about me. The thing I find difficult to grasp is this:
you have painted a picture of huge differences and you have also
very plausibly suggested that you did the best that you could
have done in the difficult combination of circumstances that confronted
you when you arrived. Nonetheless, you arrived in December 2004
and it was 1 June 2006 when the internal audit function was set
up. You knew the moment you arrived that you were the Accounting
Officer and for those 18 or 19 months there was no internal audit
function, you had somebody from the Home Office to help you.
Mr Green: Yes.
Q128 Mr Bacon: You may recollect
that the internal audit function at the Home Office was in what
could charitably be described as a train wreck and more censoriously
as a meltdown; they were in complete chaos and how they could
spare people to lend to you I do not know.
Mr Green: She was actually on
secondment and I got her from the Cabinet Office actually. She
was well experienced in the sort of processes one needed to set
up a new department from almost nothing. She did basic things.
Q129 Mr Bacon: It was you as Accounting
Officer who had to write in your statement of internal control
"Nothing was done to prepare the organisation for the production
of its first set of resource accounts." You as the Accounting
Officer had to write that and sign it off.
Mr Green: Yes.
Q130 Mr Bacon: It was ultimately
your responsibility to have made that happen. With the benefit
of hindsight what would you have done differently or sooner?
Mr Green: I would have got external
advice in to tell me what I needed, I would have put greater emphasis
on getting more qualified, permanent staff in finance and I would
have done the same in the HR function as well, and, in retrospect,
I wish I had. I did not have that knowledge and, as I say, I was
concentrating on getting the legal side right.
Q131 Chairman: We would expect you
to, you are a lawyer. This, to me, makes it seem that the half
day that the Treasury gave you in training was perhaps not adequate
and is there not a case for saying to the Treasury that your role
was inadequate? If it is a new organisation, you have got in a
chap with enormous skills in his particular discipline, but not
necessarily experienced in managing a reasonable-sized organisation
with staff, different departments and tens of millions of pounds
of budget, okay, we are not talking of HMRC here, but we are talking,
for the average person in management terms, of a reasonably large
undertaking to get to grips with, should the Treasury and its
allied agencies not have been more focused on getting Mr Green,
or indeed anybody starting something similar in a similar agency
or department, up the learning curve of what was required to run
it much more quickly so that, instead of having to go off and
buy some HR policies off the shelf or get them tailored, there
was more help available from the centre?
Ms Diggle: Reflecting on what
I have heard this afternoon, I certainly agree that is what should
have happened, and I was just making myself a note that we should
make that happen in future.
Q132 Mr Bacon: Who? Is it the OGC
who ought to have been doing that or the Treasury itself or?
Ms Diggle: I need to reflect on
that, but certainly every Accounting Officer needs to be quite
clear that this is something he needs to do and most Accounting
Officers, as they are new, are not in fact, as Mr Green was, new
to the public service.
Q133 Mr Bacon: But when particularly
they are new to the public service, then it is even more relevant.
Ms Diggle: Exactly so. That is
what I was thinking we should make sure happens.
Q134 Mr Bacon: When you have reflected
on it, could you send in a note for the Committee's Report with
your conclusions because I would be interested to know which bits
of the Treasury or wherein sits the expertise in the Treasury
that should be thinking about these things and offering advice
and help.[4]
Ms Diggle: I will do that.
Mr Green: Mr Bacon, I think possibly,
with respect, the answer might be this: that, as I think I alluded
to earlier, in 2004, before I came, I know that there was discussion
with the Treasury about what sort of model RCPO should follow,
and it was decided, on perfectly decent Gershon principles, that
RCPO should buy in its services from what was then Customs and
Excise. It was not until after those decisions had been made that,
following the O'Donnell Report, the decision was made to merge
Customs and Revenue, so this new Department, obviously they did
supply us with services, but their priorities were merging, slimming
down and getting on with their new identity.
Q135 Mr Bacon: Rather than supplying
outsourced services to you?
Mr Green: Well, I remember a very
senior person in Revenue and Customs saying to me, "The trouble
is we make vanilla and you want chocolate", and I think that
actually encapsulates it.
Q136 Chairman: You see, what I cannot
understand is that you put up a very convincing performance and,
if one were listening to this, you would think that you took over
a flawed organisation, you have turned it around and everything,
and what I cannot understand is that you arrived in 2004 and in
November 2006 you signed these flawed accounts and you asked that
they be submitted for audit. If you were so much on the ball,
why did you do that? It is not entirely clear to me.
Mr Green: I do not think I pretended
to be on the ball on the finance side or on the accounts side.
I realised we had a serious problem when the counsel fees problem
was brought to my attention.
Q137 Chairman: But you should not
have signed them off. That is why we have an Accounting Officer.
You took on this job and that is your job, you are the Accounting
Officer. If something is wrong, you should not sign it off, otherwise,
the whole system of public accountability breaks down.
Mr Green: As I understand it,
as I recall, by that time we believed that we had got a reasonably
firm opening balance, so—
Q138 Chairman: But the NAO does not
agree with you.
Mr Green: Well, this was far too
late, but we do think we got there, but then of course in the
following year we had yet more fee notes come in and we had to
recognise in the following year's accounts a further £1.7
million in counsel fee expenditure. It is deeply regrettable and,
Mr Leigh—
Q139 Chairman: Just say sorry, it
is fine.
Mr Green: —no one was more
disappointed than me that we could not get a decent set of accounts
in.
Chairman: Okay, that is fine. Thank you,
Mr Green. That concludes our hearing.
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