Examination of Witnesses (Question Numbers
1-19)
RT HON
BEN BRADSHAW
MP AND MR
JONATHAN STEPHENS
20 OCTOBER 2009
Q1 Chairman: Good morning. Can I welcome
the Secretary of State in his first appearance before the Committee
this morning and also the Permanent Secretary of DCMS, Jonathan
Stephens. The purpose of this morning's session is to look specifically
at DCMS's Annual Report and Accounts but, as usual, we range far
and wide covering the responsibilities within the Department.
Perhaps I could start with the Annual Report. On the face of it,
the Department did rather well in that you under spent by £80
million in the last financial year against the final estimated
voted by Parliament. The main reason you were able to deliver
that was £160 million under spend in respect of the Olympic
Delivery Authority. If we balance against that, there are some
very significant overspends: £10 million overspend on Free
Swimming, £15 million overspend on the Tate Gallery, £38
million overspend on the Arts Council, £22 million overspend
on UK Sport. Does this not suggest that your financial planning
is somewhat lacking in the Department?
Mr Bradshaw: I
am sorry to have to deflect the first question to the Permanent
Secretary because this was, of course, the financial year before
I was in the Department and as the Accounting Officer I think
he can probably give you a more comprehensive answer to that initial
question.
Mr Stephens: Those reflect under
spends or overspends against the original parliamentary estimates
so they do not reflect budgetary changes agreed with the Treasury
during the year, including access, for example, to end year flexibility,
namely previous years' under spending. So against the budget finally
set by the Treasury we actually came in very close to the budget
but because we had significant under spending on the Olympic spending
during the year we did not need to return to Parliament to secure
a supplementary estimate in the normal way that would be expected,
which would then have revised those figures.
Q2 Chairman: Are you suggesting that
the overspends were allowed because of the under spend on the
Olympic budget?
Mr Stephens: No, they reflected
other budgetary flexibilities allowed by the Treasury. It was
not a case, for example, of us taking money from the Olympic budget
and putting it into the other areas. The Olympic budget is managed
as a ring fenced budget within the Department's overall allocation.
What I was pointing out was that we had access to other flexibilities,
including end year flexibility and also the access to some income
from the sale of a significant asset of the Department, the land
to the north of the British Library, which meant that during the
year, with the agreement of the Treasury, our budget was increased
but that did not need to be reflected in parliamentary estimates.
Q3 Chairman: It was also reported
in July that there was a significant shortfall of £100 million
in the capital budget which was intended to pay for a number of
specific projects. We now learn that in actual fact you have been
successful in gaining money from the Treasury and that you are
intending to go ahead with the projects. I think, Secretary of
State, I heard you say on the radio at the weekend that part of
the cost of these was going to be met from efficiency savings
with the Department. Would you like to tell us a bit more about
these efficiency savings?
Mr Bradshaw: Yes, I would be happy
to. First of all I hope you will think it is fairly good news
that we have managed to persuade the Treasury to allow us an extra
£30 million draw down on our end year flexibility pot this
year and next year. The rest of that gap has been helped by their
allowing our museums to dip into their reserves without that counting
against our Department for Employment and Learning (DEL). The
remainder of it will be met by what we propose to be £10
million of savings in the next financial year which we are currently
discussing with all of our non-departmental public bodies (NDPBs)
and other bodies as well as efficiencies within the Department's
own internal spend.
Q4 Chairman: In terms of the revenue
expenditure for grants that you give to the NDPBs, there have
been reports of very significant reductions; is that still likely
to be the case?
Mr Bradshaw: No, that should not
be the case at all. In fact, if you look at the trend of spend
during this competitive spending review (CSR) period it is up
on the previous year and in each of the three years for virtually
all of our NDPBs. It is up each year of the three year CSR period.
Obviously there may be an impact in the third year depending on
what decisions are made working with our partner organisations
on finding that extra £10 million, but it should not have
the overall impact of the sort of cuts that you describe.
Q5 Chairman: Bodies like the Arts
Council and English Heritage can look forward at least to some
stability if not significant growth.
Mr Bradshaw: The Arts Council
spend profile I can give you exactly: £437 million last year,
£443 million this year and the projection is for £463
million next year—2010/2011—so that is quite a significant
increase on this year.
Q6 Chairman: You do not anticipate
that figure changing.
Mr Bradshaw: It may be that as
part of the £10 million that a small amount of that would
come off, but given that the increase is £20 million from
this year to next the impact on the Arts Council's budget in relative
terms would be very insignificant.
Q7 Mr Sanders: It is a little while
since money was spent on producing a new logo for the Department
a change which happened just six years after the Department was
created. I am just wondering what benefits there have been to
the Department's productivity from the expenditure of public money
on a new logo.
Mr Stephens: I have to confess
that the new logo predates even my arrival in 2006. I think if
you said it was six years after the Department was created, that
would be 2003.
Q8 Mr Sanders: It was 2006.
Mr Stephens: That is a little
time after the creation of the Department. Clearly it is important
that the Department's identity is clearly and well known. That
is something that when we give funding to our bodies for capital
projects we attach importance to; we do not have any plans to
revise or have a new logo as far as I am concerned.
Mr Bradshaw: Can I just add a
value for money point? As a Department we have always delivered
on our efficiency targets. We delivered £50.8 million in
2008/09 against a target of £48 million. Whether that is
relevant to your question on value for money I will leave you
to make a judgment.
Q9 Mr Sanders: I do not think it
is directly relevant to my question. My question is actually about
how you would judge the efficacy of spending money on a logo.
I am not sure if anybody can remember what the logo was that it
replaced, but the argument at the time was that it would improve
the distinctiveness of the Department in the eyes of the public
but I am not aware that any test has been undertaken to judge
whether that was so. Have any studies been undertaken to show
whether that money that was spent on the logo has actually represented
value for money for the taxpayer?
Mr Bradshaw: I do not know how
you would measure that. I think what you can measure is the success
of our Department in having argued successfully for an increase
in the current CSR period for the benefit of all of the organisations
that we care about deeply and when some departments had a cash
freeze in their budget. I think in fact that the Department is
delivering on its Public Service Agreements (PSAs) and Departmental
Strategic Objectives (DSOs). How you measure the direct impact
of a logo on a successful performance of a department strikes
me as being a question that is impossible to answer.
Q10 Mr Sanders: It is the kind of
question that you ask other bodies to determine when they put
in applications for funds from government departments. They have
to prove how that money will be spent and what value will derive
from it. It seems there is one law for them and a different law
for a department where a new logo is chosen.
Mr Bradshaw: We certainly would
expect all the organisations we fund to deliver value for money,
but whether we would ask them to measure the direct impact of
their logo on their ability to do so, I am not aware we have ever
done that in any of the departments I have worked in and I do
not think it is measurable.
Chairman: Let us move to something completely
different. Paul Farrelly?
Q11 Paul Farrelly: As a Committee
we have been, with the departments, through a long process of
scrutiny regarding the Heritage Bill. It was quite a surprise
to everybody that the Queen's Speech did not feature the Bill
at all, particularly as in terms of voting days in the House of
Commons we have not had the busiest of schedules in the last year.
Could you tell us what efforts the Department is making to ensure
that a Heritage Bill is included in the forthcoming Queen's Speech?
Mr Bradshaw: It was not in the
draft Queen's Speech so I would be very surprised if it was in
the forthcoming Queen's Speech and we regret that. We always argue
very strongly for our legislation and I regret the fact that it
has not been possible to include a Heritage Bill in the recent
parliamentary session. I hope the Committee would understand that
there is always extremely stiff competition for legislation, and
legislation has to take priority in terms of how the Government
as a whole thinks. I hope very much that we will have a bill on
the digital economy and it may be for the Committee itself to
reach a view as to which of those two pieces of legislation is
more urgent. That does not mean, however, that we have not been
able to make progress on many of the issues that you highlighted
in your report on heritage both on the public policy statement,
on planning, on the vision statement which my colleague Margaret
Hodge will be publishing shortly and a number of the other issues
that you highlighted in your Select Committee Report.
Q12 Paul Farrelly: Clearly we have
had a very thin parliamentary schedule in terms of voting days
in the last year. Just to be precise, you do not foresee any Heritage
Bill being produced in the House this side of the general election?
Mr Bradshaw: Given that the next
session is going to be, by its nature, truncated and it will bear
all the qualities of a session running up to a general election,
which brings with it its own challenges in terms of managing the
Government's business, and given that the pressure, if anything,
is for fewer bills in the coming session than were published in
the draft legislative programme in the summer, I think it would
be highly unlikely. I hope very much though that we will have
a Digital Britain Bill which, certainly so far as the Department
is concerned, would be our legislative priority given some of
the pressing issues on our digital economy and some of the issues
that we may come on to discuss later.
Q13 Paul Farrelly: Clearly there
are a lot of bills that get passed that are neither foreseen nor
contained in the Queen' Speech. When it became clear that this
last parliamentary session was not one of the busiest in legislative
terms, did the government make any further lobbying to include
a Heritage Bill at all?
Mr Stephens: This is regularly
debated across government; the ultimate decision is for the Cabinet
and, along with a number of other departments, we have pressed
our case strongly. As the Secretary of State has indicated, we
have taken significant steps to ensure that the principles and
policies behind the Bill, as set out in the original White Paper,
can be carried forward in the meantime. We have done a lot of
work to ensure that that is the case and that is supported and
appreciated by the sector.
Q14 Paul Farrelly: On that point,
English Heritage has said that two-thirds of the content of the
proposed Bill could be implemented without legislation. Do you
agree with that?
Mr Bradshaw: Yes we do and we
are in the process of doing that. I do not know whether it would
be helpful to the Committee if I were to write formally to the
Committee outlining exactly what we have already done and what
we propose to do without the need for primary legislation to deliver
it. I would be happy to do that.
Q15 Paul Farrelly: That would be
useful. It then begs the question, why produce a draft Bill in
the first place?
Mr Bradshaw: Again this predates
me so I will refer the question to the Permanent Secretary.
Mr Stephens: We recognise the
need for development policy across the heritage sector. We went
through an extensive period of consultation. There are aspects
that can only be introduced by legislation and the opportunity
both to take policy forward and to consolidate existing legislation
was widely welcomed. One of the aspects, for example, that can
only be introduced by legislation is consolidation of the various
different lists for scheduling historic and ancient monuments
into one fundamental list which is a significant measure of simplification
for the sector for businesses and individuals who are involved.
That can only be achieved by legislation but we can put in place
a number of administrative measures in the meantime that come
close to achieving some of that simplification and introducing
a number of the policy changes elsewhere.
Q16 Paul Farrelly: One of the things
that you have pressed ahead on was a new Policy Planning Statement,
PPS15, and one of the comments that has come from the sector which
I am involved in day to day in my area is that some of the definitions
and designations in the Policy Planning Statement relate to the
abandoned draft Bill and are not found elsewhere which is causing
some confusion.
Mr Stephens: That is clearly something
we need to reflect on along with the Department of Communities
and Local Government because this is a joint planning statement
with them.
Q17 Paul Farrelly: Secretary of State,
could you address that issue in your letter?
Mr Bradshaw: Yes, I would be happy
to. It is a draft, it is out for consultation and anybody is free—and
indeed we would welcome their comments—to comment on it,
but I am happy to do that.
Q18 Paul Farrelly: One other comment
that has been made is that despite the title, heritage does not
seem to carry much weight in the draft and it seems to be rather
more of a developer's charter than a protector of the historic
environment. How would you respond to that concern?
Mr Stephens: What we are trying
to do is to reflect the development of policy so that along with
our heritage advisers in English Heritage many positive developments
have taken place which allow for positive development and preservation
of listed buildings and their return into current and appropriate
use. I think that is an area in which the sector has significantly
developed over recent years and was looking for us—this
emerged during consultation on the original policy—to reflect
that in revised policy and guidance. The revised guidance is an
attempt to ensure that buildings with historic architectural merit
are protected but also that where development is appropriate and
consistent with that protection, that there are not excessive
or unreasonable controls that might prevent the return to current
use and a sustainable future for these buildings.
Q19 Paul Farrelly: Would you accept
a point that has been made by a number of organisations that in
terms of getting a draft that was more acceptable and more comprehensive,
the Department should have relied on wider input rather than principally
just on English Heritage?
Mr Stephens: This followed on
a very extensive process of policy development consultation which
had the widest possible consultation so we published a consultation
policy paper leading up to the original white paper. We then published
what was originally the Bill in draft, again inviting consultation.
The revised policy guidance is now again out for consultation.
Of course the government develops these things with its heritage
advisor in English Heritage but then seeks to ensure that these
are open to and commented on by the sector as a whole. Certainly
my impression is that the sector has welcomed that approach and
it has helped to build a broad consensus behind the thrust of
policy.
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