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20 May 2009 : Column 1517

Kerry McCarthy (Bristol, East) (Lab): I entirely endorse the comments of my hon. Friend the Member for North-East Derbyshire (Natascha Engel) about the need to restore people’s confidence and faith in the political system, and in some cases to create that confidence and faith in the first instance. One suggestion is that we should move to real-time month-by-month publication of claims, if not when they are submitted then at least when they are approved. Is that under active consideration?

Ms Harman: That was one of the things that was agreed last time—that there should be publication month by month of claims that have been made and allowed—but obviously we are looking all the time at how we can improve transparency. These things will not be set in stone, and any other suggestions that hon. Members have will be— [Interruption.] I have just been told by my deputy that it will be reported quarterly, not monthly, and I take it that my hon. Friend the Member for Bristol, East (Kerry McCarthy) is suggesting that we do it more frequently.

Mrs. Eleanor Laing (Epping Forest) (Con): I welcome today’s statement. Does the right hon. and learned Lady agree that if it is really our intention to have here a legislature that is broadly reflective of the people whom we seek to represent, it must be made clear and taken into consideration that this is not a gentlemen’s club, and that many Members have to balance their parliamentary and constituency duties with their family duties? That applies not only to those of us who are mothers of small children but to those with other family duties.

It has been very upsetting to read in the press the great idea that we could all live in barracks in London. I ask the House to take into consideration where we will put our children and when we will have time to see them. If we want to have a legislature that really reflects the people, it must reflect families. The financial arrangements must therefore reflect the need for some of us to undertake family duties as well as parliamentary and constituency duties.

Ms Harman: The hon. Lady has added another principle to the list that I suggest we all adhere to. We must not just be a millionaires’ Parliament, and we must respect the constituency link and have good professional offices. Also, this should not just be a Parliament of single people who either have never had families or whose families have grown up. The insight that hon. Members bring of struggling to balance work and family responsibilities, and of caring for older relatives and younger children, helps to shape public policy and helps us understand the lives of people in this country. I would definitely adopt the principle that she has put forward.

Adam Price (Carmarthen, East and Dinefwr) (PC): It is not just the expenses scandal that has tarnished the reputation of this House in what has been a low, dishonest decade for parliamentary democracy, but the deception perpetrated by the previous Prime Minister in taking us to war on the basis of a pack of lies. That caused almost irreparable damage to people’s trust in politics and politicians.

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My question to the right hon. and learned Lady is this: will the standard of honesty form part of the remit of the new parliamentary standards authority, so that members of the public can refer for independent investigation cases in which they believe there is evidence that Members of Parliament, including Ministers, have misled this House and misled the country?

Several hon. Members rose

Mr. Speaker: Order. There are only a few hon. Members left, and I have given a lot of leeway, particularly in this matter, but it really should just be a supplementary question that is asked. I ask the remaining Members to do that.

Ms Harman: We are, of course, answerable to our constituents for the honesty and integrity with which we represent them and go about our work in the House, and to the Chair for not misleading other Members. I think that the regulation of our democracy is ultimately with those who elect us. We are currently considering regulating our pay and our allowances, having codes of conduct and making proposals for their enforcement; that does not cut across the basic fundamental principle of democracy.

Mr. Peter Bone (Wellingborough) (Con): I thank the Leader of the House for her statement and for the leadership that she has shown on this matter. Many hon. Members have made submissions to Sir Christopher Kelly. Will the Government accept his recommendations, whatever they are?

Ms Harman: At the meeting that the Speaker convened yesterday, the view of the party leaders was that it would be best for the House and all concerned if we could agree with as much as possible of what Sir Christopher Kelly proposes. I think that the Leader of the Opposition said on television that we want to agree with 99.9 per cent. of what Sir Christopher Kelly suggests. That is not to seek to allow for wriggle room. It is in the right spirit and all our interests if we all give evidence to Sir Christopher Kelly—the deadline is 5 June. It is important for hon. Members to give evidence for him to consider. A great deal of responsibility rests on him because we want, cross party, to adopt what he recommends, which will then be put into practice by the new statutory authority. He is like the software, and the hardware will be established by statute in the new authority.

Mr. Paul Goodman (Wycombe) (Con): Just to round off, Members of Parliament are either elected representatives, who are free to work outside this place, or professional politicians, who are not, and are therefore entirely dependent on the taxpayer as members of a political class, separate and distinct from those who elect them. What is the Government’s view?

Ms Harman: The Prime Minister asked Sir Christopher Kelly to look into that, and he will make his recommendations. In the meantime, the House voted on 30 April for a proper register of all the remuneration from the different additional jobs that Members have. The bottom line is that the public should be able to know where Members of Parliament get additional
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money from. That was not the case until we made the change. We have therefore already taken steps on transparency.

I am not sure that I agree with the hon. Gentleman’s idea that we are members of the political classes. I do not regard myself as part of the political class. Indeed, many of those in the political class have long thought that I should not be in it. I am many things—I represent my constituency in Camberwell and Peckham; I am a wife, a mother, a former lawyer. We are all different things, and we should not allow ourselves to be pushed into believing that, without second jobs from which we rake in money, we are somehow unworthy members of a political class. So I think my answer to the hon. Gentleman’s question, which I cannot remember, is probably no.

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Point of Order

1.23 pm

Mr. Greg Hands (Hammersmith and Fulham) (Con): On a point of order, Mr. Speaker. Once again, the Prime Minister visited my constituency last week—to deliver a speech on crime at Chelsea football club. As has been the case for every visit that he has made to Hammersmith and Fulham in the past four years, he failed to inform me as the constituency Member of Parliament. As ever, his tactic is for one of his junior Ministers to send out a fax saying that the junior Minister will come, but not mentioning the Prime Minister’s presence. The rules are clear. How can we enforce the conventions and courtesies of the House—

Mr. Speaker: Order. The hon. Gentleman is trying to debate the matter. He has made his point—let me look into the problem. The purpose of points of order is not debate. Let me look at the matter; that would be best.

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Appointment of the Comptroller and Auditor General

[Relevant Document: The Twelfth Report from the Committee of Public Accounts, HC 256, on Selection of the new Comptroller and Auditor General . ]

1.24 pm

The Prime Minister (Mr. Gordon Brown): I beg to move,

Mr. Morse has agreed that the appointment will be for a non-renewable term of 10 years. I should like to record the Government’s thanks to Mr. Tim Burr, who agreed to serve on an interim basis and recently announced his retirement, for his work and expertise.

As a first stage in implementing the recommendations of the Public Accounts Commission, a new board structure with a majority of independent non-executives, including a non-executive chair, who has already been appointed—Sir Andrew Likierman—is being established.

The Government will introduce legislation to implement the other recommendations of the Public Accounts Commission on the governance of the National Audit Office.

Mr. Morse was subject to a pre-appointment hearing before the Public Accounts Committee—the first such hearing that the Committee has held. He will be the first Comptroller and Auditor General who has extensive private as well as public sector experience, which will enable him to bring best practice and discipline to public audit work, and that will benefit the scrutiny of Government.

I believe that Mr. Morse is eminently qualified for the office of Comptroller and Auditor General, and I commend the motion to the House.

1.26 pm

Mr. Edward Leigh (Gainsborough) (Con): It is a pleasure to second the Prime Minister’s motion. I personally thank the Prime Minister for his role in the process, which has been completely fair and open.

The whole point of the job of Comptroller and Auditor General is that it must be above politics. For 150 years, since Mr. Gladstone founded the Public Accounts Committee, it has been a tradition that the Chairman of that Committee is drawn from the Opposition. However, there is also a well-established convention, which is now in statute, that the new Comptroller and Auditor General must be appointed by the Prime Minister—by definition, a member of the Government—and that the Chairman of the Public Accounts Committee, who is obviously a member of the Opposition, must countersign the motion. Both Government and Opposition therefore have a lock on the appointment. As far as I know, it is the only public sector appointment to which that applies.

Apart from what I have outlined, the process is new because it is 20 years since we had to appoint a permanent Comptroller and Auditor General. The last time we did it was when Baroness Thatcher, as Prime Minister, appointed Sir John Bourn. The system was old fashioned,
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with no open advertisement. My predecessor, Robert Sheldon, now Lord Sheldon, conducted interviews on his own, and that was clearly inappropriate. We had to create a modern structure, and we have tried to do that.

In his opening remarks, the Prime Minister alluded to the modern structure. The first step in the process was to make the National Audit Office completely open, transparent and accountable. We had to preserve the ability of the Comptroller and Auditor to be entirely responsible for his reports—nobody can influence their content. However, it was clearly wrong that he was running the National Audit Office on his own. There had to be a modern board structure and, as the Prime Minister said, the Public Accounts Commission—not the Committee, but the Commission, under the able chairmanship of the Father of the House, who is here today—devised a structure.

I headed an appointments panel, which appointed the new chairman of the National Audit Office, Sir Andrew Likierman, who has unrivalled experience. He was head of the Government Accountancy Service—apparently known in the trade as “Hot GAS”—and is the dean of the London business school. He was an outstanding candidate and now sits at the apex of this modern, open and transparent National Audit Office. This morning, the Commission met again, and we have given him the go-ahead to appoint further independent board members. The creation of an independent structure was therefore the first part of the process.

We then had to move to interviewing. Again, I thank the Prime Minister. Of course, he is far too busy running the country to sit for 25 hours, as we had to do, interviewing people, and he therefore delegated Sir Nick Macpherson, the Treasury’s permanent secretary, to sit on the interview panel, which I chaired with Tim Burr. I thank Sir Nick Macpherson, with whom I worked closely and who is an outstanding public servant, and Gus O’Donnell, Secretary to the Cabinet, for their help in the process. The process was completely open and transparent, with open advertisements, head-hunters appointed, a long list of outstanding people applying, more than 20 hours of interviews and Sir Andrew Likierman finally getting involved, and we came up with an outstanding candidate, Amyas Morse.

As the Prime Minister said in his opening remarks, Amyas Morse is, as far as I know, the first ever chartered accounted to be Comptroller and Auditor General. That is an important point in respect of when we talk about professionalising the civil service. He works in the public sector at present, having taken a huge cut in his salary to do so, but before that he rose right to the top of the accountancy profession, as the global managing partner of PricewaterhouseCoopers. It was quite obvious to all of us that he was the outstanding candidate and that is why we on the panel decided to appoint him.

Amyas Morse’s name was then put to the Prime Minister, who, again in the entirely helpful way in which he has conducted the process, approved the nomination within days. He had a veto, but he decided to trust the Committee with our decision. As the Prime Minister said, we then had the first ever confirmation hearing before the Public Accounts Committee; it is something that has never happened before. My colleagues on the Committee will confirm that Amyas Morse performed very well, with firm, well-argued answers, and the Committee clearly had confidence in him.

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The whole process is extremely important. It is not just about appointing a chartered accountant or an accountant of government, and it is far more important than just bean counting or adding up the figures. The National Audit Office is at the centre of the drive to promote economy and efficiency in government. It spends £103 million a year, but it saves the best part of £900 million a year. The National Audit Office is at the centre of the process. The Public Accounts Committee could not work without the National Audit Office, headed by the independent Comptroller and Auditor General.

Whatever the faults in our Budget process or whatever Parliament’s other faults may be, it is not surprising that our process of audit is widely admired and copied throughout the world. It is not surprising that every Commonwealth country has a supreme audit body reporting to a public accounts committee, but even the Czechs have now created a public accounts committee in the past two years. They have perhaps taken to extremes the idea that their chairman—the person who will hold their Government to account—should be a member of the opposition, and have appointed a communist.

We can be very proud of the work of the Public Accounts Committee. We should thank the National Audit Office and pay tribute to Tim Burr for holding the fort for this interim period. We have appointed a man who must be completely un-influenceable by anybody. That is why we said that he will have one term for 10 years that will not be renewable. The position must also be completely independent. We have ensured his independence through the process that we have undergone. I think that Amyas Morse will be a worthy successor to Tim Burr and I commend his name to the House.

1.33 pm

Mr. David Gauke (South-West Hertfordshire) (Con): It is symbolic of the significance of the post of Comptroller and Auditor General that the announcement of his appointment should be made in the House by the Prime Minister. However, it would be fair to say that doing so is not one of the more onerous duties of a Prime Minister.

As we heard, such an announcement has been made only twice before, first in December 1987, when Margaret Thatcher announced the appointment of Sir John Bourn. I note that on that occasion the person responding from the Front Bench on behalf of the official Opposition was the right hon. Member for Newcastle upon Tyne, East and Wallsend (Mr. Brown), who is here again today. Indeed, if I remember rightly, he was also present on the second occasion, in January 2008, when the Prime Minister announced the interim appointment of Tim Burr.

Such announcements are happening slightly more frequently now, with somewhat less of a gap between them. It is not unusual in public life for one person to hold a position for a long time and for his successor’s time in office to be relatively brief. However, that is no reflection on Tim Burr’s performance, because it was always his intention to take the position for an interim period. He has had a distinguished career, working for the National Audit Office for 15 years before becoming
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the Comptroller and Auditor General, eight of which were spent as deputy. As we heard from my hon. Friend the Member for Gainsborough (Mr. Leigh), the Chairman of the Public Accounts Committee, Tim Burr played a useful role in the selection of his successor. I would like to thank him for his contribution over many years.

When we debated Mr. Burr’s appointment in January 2008, much of the discussion centred on the selection process. The consensus in the House was that it was important for Parliament to have a significant role in the appointment to such an important position as that of Comptroller and Auditor General. Some argued for a parliamentary vote. Others, including the Chairman of the Public Accounts Committee, argued that if that were to happen, there may be a perception of a loss of independence from the Executive. The Chairman of the Public Accounts Committee is an Opposition MP, and if he has a greater role in the appointment, the perception may be one of greater independence. That view has prevailed and the Government have accepted it. I fully acknowledge my hon. Friend’s point that both he and the Prime Minister have worked together successfully and smoothly in making this appointment. That helps with the perception of independence.

I agree with both the Prime Minister and my hon. Friend that an appointment for a single 10-year term is also helpful in maintaining independence and the perception of independence. There can be difficulties and dangers—perhaps more of perception than in reality—when someone has a shorter term and is then reappointed. For example, adverse comment was made about the delays in the reappointment of the Governor of the Bank of England. We think that the current structure has much to commend it.

In debating the appointment of Mr. Amyas Morse, it is worth highlighting how important the role of the Comptroller and Auditor General has always been and, indeed, how much more important it may become in the years ahead. We are entering a period of public spending restraint. We face record levels of borrowing and it will be necessary to ensure that public money is spent wisely, whoever is in power in the years ahead. Even the Government recognise that there is room for further efficiencies. In a period when the Government’s projections are such that there will be real-terms reductions in departmental spending in some areas, the emphasis on value for money is significant.

Hon. Members perhaps need no reminding of this, but it is worth reiterating the fact that the demand from the public for greater transparency in and scrutiny of public spending is greater than it has ever been before. The public demand to know more. We live in a less deferential society. Developments in technology make it easier for information to be disseminated and obtained. For example, the Conservative party supports the introduction of a website detailing items of significant public spending. We think that more can always be done. However, the National Audit Office, the Comptroller and Auditor General and the Public Accounts Committee all have distinguished records in scrutinising public spending, and they will continue to perform that important role. Indeed, just last night in his statement, Mr. Speaker announced a role for the Comptroller and Auditor General in examining MPs’ expenses.

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