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Leaving aside the question of the Treasury’s not replying to a question to which it swore that it would reply, I want to raise a number of other points. I remember receiving an astonishing response relating to the shared services centre being set up by the Department for Transport for the Department and its agencies. At the time when we investigated the matter, the establishment of the centre, which had originally been going to save us
£57 million, was going to cost us £81 million. The Department told us that it would not actually cost us that amount, because it would take action to reduce the figure. No one was dismissed as a result; I believe that people moved on. The point has already been made about careers possibly being slightly blighted, but there was not the degree of accountability to which others have referred.
Another issue that interested me was the NHS pay modernisation scheme, when GPs’ mouths were stuffed with gold. As the debate proceeded, what was increasingly noticeable was the contrast between the extent to which partners in general practices had hoovered up as much of the available money as they thought they could possibly get away with, and the amount that they were giving to their staff. If I remember correctly, the salaried GPs received 3 per cent. increases over a period of two years—although it may have been one—while some nurses’ salaries actually fell. As far as I know, those facts were not picked up anywhere else in the system.
In the light of those examples, I have some sympathy with the views of the hon. Member for Harwich (Mr. Carswell) about the need to hold the Government to account. However, some of his statements have led me to conclude that he is a true zealot when it comes to open markets. I see that he takes that as a compliment, but I have not finished my point yet. He confessed that he would be perfectly happy to see shipyard orders going abroad and believed that all British defence orders should be opened up to international competition, notwithstanding the impact that that would have on jobs in the United Kingdom. His clear expression of that view gives us some understanding of why he speaks from the Back Benches rather than the Front Bench. I am quite sure that it is not the view that will be expressed shortly by the hon. Member for Hammersmith and Fulham (Mr. Hands), although I will happily give way to him if he wishes to assure us otherwise.
Mr. Carswell: Does the hon. Gentleman believe that protectionist procurement sometimes means that our soldiers in Afghanistan and Iraq do not have the equipment that they would otherwise have, and does he consider that acceptable?
Mr. Davidson: I do not believe that protectionist procurement necessarily leads to that result. All the evidence that we have received over a period in relation to urgent operational requirement contracting suggests that British defence industries can respond speedily in providing equipment when it is needed urgently by our forces in the front line, and when that has not been possible, the Government have always been perfectly willing to go abroad to pursue the very point that the hon. Gentleman has raised.
Let me give an example relating to ships, in which my constituency has an interest. I have no doubt that we would have been able to buy some of the ships that we have more cheaply had we bought them abroad, but that would have destroyed our capacity to purchase them in the United Kingdom in the future. There is always a balance to be struck between savings now and retaining capacity for the future, which is what the defence industrial strategy is all about—but I am happy to let the hon. Gentleman dig himself further into a hole.
Mr. Carswell: Does not the hon. Gentleman agree that one reason why there has been such a big increase in the use of urgent operational requirements to procure is precisely that the armed forces find that by procuring through urgent operational procurements they are free from any of the protectionist constraints inherent in the defence industrial strategy?
Mr. Davidson: No, that is not my view. Most of the urgent operational requirement contracts have arisen because the armed forces are in new environments and they discover that they have urgent operational requirements for particular pieces of equipment. They did not envisage having an urgent operational requirement for a piece of equipment until they found that they needed it, otherwise it would have been in the system already. I know from provision made from plants in my constituency that the forces have been genuinely astonished about what they found they needed, as they thought they had equipment that was entirely satisfactory. As I am sure we are all aware, the stuff that is necessary for fighting on the north German plain is not necessarily the same stuff that is needed for fighting in the mountains of Afghanistan; even some of the materiel that was necessary for Iraq is not adequate for Afghanistan. Therefore, it is changes of environment that produce urgent operational requirements; I would have thought that was blindingly obvious.
Let me return to the point about the hon. Gentleman being a zealot and joining the PAC as a member of the Tory Taliban. There is an issue to do with the extent to which Members sit on the Committee to paddle their own canoes and pursue their own private obsessions—the extent to which they are there to judge whether a Government decision was right in the first place—and the extent to which they are there to judge whether that decision, having been made, has been implemented correctly. It seems to me that the hon. Gentleman has got himself on the wrong side of that balance. It is not our job as PAC members to decide whether these contracts should have been thrown open to competition across the world; it is our job to decide, the Government having made such decisions, whether a contract has been implemented as speedily, accurately and well as it should have been. I look forward to the PAC Chairman ruling the hon. Gentleman out of order on a number of occasions in future, since the Chairman’s predecessor did that often enough to me—in another direction, politically speaking.
I also want to raise the issue of culture—not the kind of culture that makes me reach for my revolver, but the culture of the Departments. That was most clearly expounded when we were discussing the management of expenditure in the Department for Environment, Food and Rural Affairs. It was revealed that the culture in some sections of the Department was always to assume that they would underspend, and that therefore they could over-order on the basis that there would then be a rough balancing-out. That is very much a case of amateur night, and is entirely indefensible. Should not the Treasury have been pursuing that, as I presume that it is the Department that supervises such matters—when it is not covering up whether or not it knows whom it employs and what their educational qualifications and social backgrounds are? Perhaps the PAC ought to return to such questions of culture in a more systematic way. I very much welcome the fact that the Chairman
has been taking us down the road of undertaking thematic explorations, in particular in relation to project management. Once we have made more progress on that, we ought to pursue the issue of changing culture.
I shall now turn to the report, “Meeting needs? The Offenders’ Learning and Skills Service”. It was revealed that in some policy areas there is a lack of provision and of delivery of service. We ought to have some system of passing that on to the appropriate committee. It is not our job to pursue the extent to which there continues to be a low level of literacy and numeracy among prisoners, or the extent to which the Prison Service’s need to move people around the estate means that their opportunities to learn are constantly disrupted. It is perhaps our job to identify that difficulty, but I am not quite clear what the mechanism then is for the concerns that we identify and express to be passed on to someone else, and for us to be sure that they are picking them up. Select Committees focus on major issues, and relatively small issues such as that might be swept up in an overall look at the Prison Service, for example, or at adult literacy. The question of the balance between moving prisoners around the system and the education and training opportunities that we offer them does not then get picked up on. I wonder whether the Chairman of the Committee could reflect on that and provide some possible solutions for the future.
Finally, I want to remind the House about our examination of the Revenue and Customs Prosecutions Office. We heard the long litany of what I regarded as exploitation of the system by barristers, who were clearly bleeding the system white. That reminds us that being involved with the private sector is not always a route toward enhanced efficiency. Some elements of the private sector are in many ways far more inefficient and self-serving, and far less controllable or demonstrably operating in the public interest than sections of the public sector. There is the assumption that says, “Private good, public bad”. Anyone who looks at the way that barristers operate—simply gouging the public sector—cannot doubt for a moment that there is a very strong argument for such sections to be examined more fully by us.
Angela Browning: In that particular case, was not the problem that the department did not get the fees agreed with barristers in advance? Rather, it waited until afterwards, without any idea of what the bill was going to be. So although I agree with the hon. Gentleman that barristers made a lot of money out of that, at the heart of the report is the view that the department was at fault.
Mr. Davidson: I have some sympathy with that perspective, but it is a bit like saying that the foxes will always raid the hen coop and it is the farmer’s fault if he does not fence in the chickens. If the premise is that barristers are generally thieves—that, given any opportunity, they will lift the silver, that they cannot be trusted to bill fairly, and that therefore it is the fault of the department in question if it has not nailed them down beforehand—then yes, that is fair. It is the attitude that I have always taken when we deal with farmers. As people will be aware—
Mr. Davidson: Ah—the Chairman wants to intervene.
Mr. Leigh: If barristers are generally thieves, then I am a very poor thief.
Mr. Davidson: I have nothing to add to that point.
Farmers, as we are well aware, are rapacious and will take anything that is not nailed down, so it is absolutely correct that to some extent, it is the fault of Government if they ever allow them to get away with the money. However, I cannot help but think that we ought to be blaming those who try to commit the theft, rather than those who have perhaps inadequately prevented them from doing it.
I have, as ever, enjoyed my time on the Public Accounts Committee. If only I did not have constituents, I could spend much more time looking after its affairs, and I look forward to continuing under the chairmanship of my esteemed colleague.
3.29 pm
Mr. Richard Bacon (South Norfolk) (Con): It is a great pleasure to follow the hon. Member for Glasgow, South-West (Mr. Davidson), who is one of the most fearless of our interrogators, and sometimes one of the funniest of our members. I regret that the name of his constituency changed from Glasgow, Pollok to Glasgow, South-West because we always liked saying Glasgow, Pollok. I know little about his constituency except that I am fairly sure he has very few barristers as constituents—
Mr. Bacon: And very few farmers—
Mr. Leigh: Or members of the royal family.
Mr. Bacon: Indeed. The hon. Member for Glasgow, South-West did not actually say just now that all farmers are thieves, but I have heard him say that before; and he did say on the record that barristers are thieves.
The hon. Gentleman also said that the right balance had to be struck between talking about reports to the Committee in a way that was not too party political and getting enough attention paid to the issue. It is something I am aware of every time I broadcast on the Committee’s work. If I am being critical, I try to be critical of the Department concerned. The hon. Gentleman used the word “dull”, and one tries to make comments sound non-party political. I go out of my way to avoid ever using the phrase “the Labour party” when I am broadcasting about Committee matters, because that would simply be inappropriate. Were there to be a change of Government at some point, which is possible, I hope that the same thing would apply if the hon. Gentleman were broadcasting in that way as an Opposition Member.
In the same spirit, there might be occasions when the hon. Gentleman should think about tempering his words. I represent a lot of farmers, and they are not all rapacious. He will remember the National Audit Office report, and our Committee report, on the case of Joseph Bowden. He was a farmer claiming money under the arable area payments scheme and the fibre flax scheme for territories—I use that word advisedly—that on closer examination, when one used the entire grid reference rather than part of it, which is all the form had required him to fill in,
turned out in one case to be in the North sea between Scotland and Denmark and, in another, to be on the mainland of Greenland. That fraud was brought to the attention of the authorities, not because of the diligence of the Ministry of Agriculture, Fisheries and Food, as it then was, but because of another farmer who realised what was going on and thought that something was odd.
I also regret that the Committee only narrowly failed to pass a resolution when we had the Duke of Westminster in front of us, as the Assistant Chief of Defence Staff, requiring the hon. Member for Glasgow, South-West to address him as “Your grace” each time he spoke to him, but that is, unfortunately, now water under the bridge.
I wondered which of the various reports I should focus on. I started the day reeling under the impact of the National Offender Management Service information system report published by the NAO. Although that report is outside the scope of this debate, as we have not even had a hearing on it, many of its themes are relevant not only to the reports before us today, but to the Committee’s work in general. The National Audit Office, together with the Office of Government Commerce, agreed in 2002 a list of eight of the most common causes of project failure. The first was the lack of a clear link between the project—whatever it was—and the organisation’s key strategic priorities, including agreed measures of success. The second was a lack of clear senior management and ministerial ownership and leadership—we certainly saw that in the case of the Rural Payments Agency, and in that of the shared services report from the Department for Transport. The third was a lack of effective engagement with stakeholders—we have seen that in many reports. The fourth was a lack of skills and a proven approach to project management and risk management. The fifth was too little attention to breaking down the development and implementation of projects into manageable steps. The sixth was that the evolution of proposals were driven by the initial price, rather than by considerations of longer-term value for money, especially the delivery of business benefits. The seventh was a lack of understanding of and contact with the supply industry at senior levels of the organisation, and the eighth was a lack of an effective project team working with the clients, supply team and supply chain.
The report published this morning happened to touch on almost all those factors, in full or in part, but they are common themes we see again and again in different reports. One thing that I hope the Minister will find time to do is to address the role of the Office of Government Commerce in scrutinising and challenging the management of Government projects and in ensuring that Departments are steering projects properly, because I do not think that there is nearly enough evidence to convince us that the system is working properly. The OGC gives advice, for sure, but time and again that advice is put to one side or ignored.
The Minister will know that applications to the fast track of the civil service are up 30 per cent., which is good news for the civil service. It is unsurprising that that should be the case in these straitened financial times. It gives the civil service a better choice from among those talented graduates, and that is good news. However, I want to know what the civil service is doing at the centre to ensure that the principles of project management and risk management—all the things that
the hon. Member for Glasgow, South-West described as being seen to be rather dull in some cases, but which are incredibly important for the successful delivery of projects—are tattooed on the eyelids of new entrants to the civil service so that they understand as they join that effective project management and focusing on outcomes are important from that moment on. They need to understand that the civil service is not only about policy advice but, as the Committee Chairman said earlier, about successfully delivering projects. I would be grateful for the Minister’s comments on that.
Our report on the roll-out of Jobcentre Plus speaks on that theme. As was mentioned earlier, the key staff included Mrs. Lesley Strathie, who is now chief executive of HMRC and who started as a clerical assistant in 1974. I was very pleased, as it was a point that I made in the Committee, that one of the recommendations of our report noted the need to focus on the fact that key leadership roles should be taken by people with significant front-line experience who had started at the bottom. The three witnesses had a total of 112 years of experience between them, and because they had started at the bottom, as the poor bloody infantry, they were going to ensure that no project was imposed in a way that could not work at grass-roots level. That was welcome.
That goes back to the Fulton report and the way its proposals were eventually defeated by William Armstrong, who was then head of the civil service, ensuring that the generalist stream of the civil service remained on top. That has been a 30 or 40-year failure across successive Governments, and I would be interested to hear the Minister’s comments on it. I think we are now getting a little more expertise. I always read the CVs of our witnesses, and more and more of them come from the private sector, or have at least some private sector background, which is interesting. They also seem to have genuine expertise in the subject that they are appearing before us to discuss. That is most welcome, but I would like to know what that says about fast-track entry and how it will be integrated into the recruitment process for the future.
I also wanted to make a point about the report on the Revenue and Customs Prosecutions Office. David Green, QC, was hired to be director of the prosecutions office, not because he had management experience or knew how to run a budget or how to procure and deliver an IT system, but because he was one of the leading criminal barristers in this country specialising in Revenue work. That was an ideal background for somebody to become director of the Revenue and Customs prosecutions office. He is a leading silk in his area, but that does not mean that the Treasury or civil service, in giving him the responsibilities of an accounting officer, which include ensuring that there is probity in the use of public money and that the proper systems are in place, can assume that a man who is extremely talented in his field will have the requisite expertise in what one might call general management. I asked Mr. Green whether he was familiar with the Treasury document on the responsibilities of an accounting officer, and he said that he had been given it and that he had been on a training course. I asked how long the training course had lasted, and he said, “Half a day.”
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