Examination of Witnesses (Questions 1-55)
RT HON
ED BALLS
MP AND
DAVID BELL
18 JANUARY 2010
Q1 Chairman: Secretary of
State and Permanent Secretary, we are very pleased that you could
come at quite short notice to talk to the Committee about the
lack of a pre-appointment hearing for the head of Ofqual. We have
asked you to come for two reasons. First, when the Prime Minister
originally announced in the White Paper the reform of our parliamentary
procedures, there was no doubt that the pre-appointment hearing
was to be a very important part of how we are going to bring back
greater relevance to our parliamentary democracy. This Committee
has had two goes at this—in the first one we had a disagreement
with you, Secretary of State; we took a different view from you
on the Children's Commissioner. Now we feel that we might have
been consulted on the pre-appointment of this very important post.
Because of that, I want to be able to report back to the Liaison
Committee whether pre-appointment hearings are something that
Select Committees should be bothered with. As you will remember,
when we had the discussion regarding the Children's Commissioner,
we discovered there was a Cabinet minute that suggested that we
do not have much power at all in this process. I want to get the
record straight. To what extent do you, Secretary of State, and
you, Permanent Secretary, believe that the pre-appointment hearings
are valid, useful, and add value? Secondly, in this particular
area, you will know, Secretary of State, that there has been a
long discussion about the importance of the real independence
of Ofqual and the head of Ofqual. You will remember, as I will,
because I was Chair of that Committee at that time, that Sir William
Stubbs resigned at a particular time over the failure of the testing
procedures, and you will know that the Secretary of State at that
time resigned shortly afterwards. So, these are very sensitive
areas that we are discussing, very sensitive appointments. You
will also know that two summers ago, when there was a very real
problem with the marking of some of our tests, we got to the situation
where eventually Ken Boston resigned. So, this is a very sensitive
area, testing and assessment. While we welcomed the changes as
Ofqual emerged, we were still very concerned that—many people
do not realise this, but as we understand the situation and perhaps
you will comment on this—two of the appointments where we
have a right to a pre-appointment hearing are appointments, like
the Children's Commissioner, where once appointed that commissioner
reports to you, Secretary of State. That is true of two of the
appointments. For the head of Ofqual and the Chief Inspector of
Schools and Children's Services, the line is reporting to Parliament
through this Committee. So, you can see our concern about the
sensitivity of where we are at the moment. We thought—I
believe I am speaking for all the Committee—that in the
spirit of all this when the emergence of Ofqual began, you would
have included, when you placed the advertisement for the acting
temporary head of Ofqual, in that advertisement, that the process
would involve a pre-appointment hearing with the Select Committee.
That advertisement and why that was not in it is really at the
very heart of the disagreement that we have with you today. Secretary
of State.
Ed Balls: As you
know, Mr Chairman, I am a full supporter of pre-appointment hearings.
I think they are very important. We all work within the guidance
set out by the Cabinet Office and, I am sure, discussed with the
Liaison Committee—that is not guidance that I drew up—and
I am fully supportive of pre-appointment hearings. In fact, if
you go back to the decisions we made about the structure of the
appointment for the Ofqual process, at that time we were a few
months after the announcement in the summer of 2007 that there
would be pre-appointment hearings. In December 2007, I wrote to
you, as Chair of the Select Committee, to tell you how we were
proceeding with our Ofqual appointment and to ask and discuss
with you how we could make sure that there was proper scrutiny.
At that time, and this was confirmed in January, the chair of
Ofqual was not on the Cabinet Office list for pre-appointment
scrutiny appointments. I believe that I am right in saying that
you wrote to the Cabinet Office Minister. I was also in touch
with the Cabinet Office, to say that I was concerned in January
2008 when the first list was published—23 January 2008—that
the chair of Ofqual was not on that list. Nor was the chair of
the QCA or of Ofsted or the Children's Commissioner. It was only
in June 2008, following I believe your intervention as a Committee
and our intervention from the Department, that those four[1]
posts were added to the list. The fact that we added those posts
for pre-appointment scrutiny, shows that we wanted, to be honest,
the importance of those posts to be properly represented by their
inclusion in that list, which as I said was first published in
June 2008. Of course, by that point, we had already proceeded
with the advert for and the appointment of the chair of Ofqual,
and done a Written Ministerial Statement in April 2008. Jim Knight,
the Schools Minister at the time, had appeared before your Committee
and we had set out very clearly our decision, at that time, before
the pre-appointment hearing process was in operation, that we
wanted to appoint a chair of interim Ofqual who would then go
on to be the chair of Ofqual when the appointment was confirmed
and the legislation went through—I think for good reasons—but
we were always clear, and are now, that Ofqual should absolutely
be a post where the chair is subject to pre-appointment hearings.
I am sure that you will want that in the future and so shall we.
Q2 Chairman: We very much
like them, Secretary of State, but our feeling is that, given
the early announcement by the Prime Minister that it would really
rejuvenate and revivify the parliamentary process, it was a most
sensitive post. First, it is strange. I think that I am right
in saying that there were originally two. The Chief Inspector
of Schools was certainly in there. Are you suggesting that the
original list had none?
Ed Balls: The Chief Inspector
of Education was in the January list.
Q3 Chairman: Yes, the Chief
Inspector was in the original, and there was some negotiation.
Wouldn't you have thought from the very beginning that that should
have been in there, as it was such a sensitive post?
Ed Balls: As I said, when we saw
the list, we made that point to the Cabinet Office. I wrote to
you on 17 December 2007 and said that, in setting out the way
in which we were going to proceed, "I expect that the Select
Committee will want to monitor and review the work of the regulator
and the interim regulator. I should be most grateful if you would
consider how the Committee could best do this, and would be happy
to discuss that further with you." When we saw the January
2008 list, we said that we wanted Ofqual, QCDA and the Children's
Commissioner added to the list. We were always clear that they
should be added, but at that point the pre-appointment hearings
process was not in operation. We wanted to move ahead. We advertised
in January 2008. The advert said very clearly that the chair of
the interim regulator "will become the first chair of the
new, independent Office of the Qualifications and Examinations
Regulator in due course and will step down as a QCA board member."
The then Schools Minister wrote to you on 10 March to make it
clear that that is how things would proceed. I then delivered
a Written Ministerial Statement in April 2008 in which I made
it clear that Kathleen Tattersall would join the QCA board, lead
Ofqual in its interim form and that "Subject to legislation,
she will become the regulator's first Chair when it is established
as an independent statutory body". The same thing was said
in the press notice in April 2008. My point is that, if at any
point during that process in December, January, February, March
or April, the Committee had felt at that time that it wanted to
jump ahead of the pre-appointment process, which was still under
discussion, and ask for Kathleen Tattersall to come to a pre-appointment
hearing, the Committee could have said that to me. But it did
not do so, and at no point was there ever discussion between us
and yourselves that there should be a pre-appointment hearing.
As I said, at that point the chair of Ofqual was not even on the
list.
Q4 Chairman: Secretary of
State, this is the nub of our disagreement. Here was a shadow
organisation that had no underpinnings in legislation. Indeed,
although you said "Subject to legislation", the advertisement
was issued on 20 January 2008 and the Act did not receive Royal
Assent until November 2009. I would have thought that the Department
would at some stage have been thinking about how important it
had been for it to have been an independent appointment, and that
it should be a conducted inquiry in which we talked to the acting
head on the assumption that, at some stage during the long process—the
legislation was not even in front of the House—we would
have such an opportunity. There is some fault on the Committee's
part, but the transition from the shadow role to permanent role
would be the appropriate time to have the interview.
Ed Balls: With respect, Chairman,
if that is your view now and it was your view then, it was not
a view that was expressed to us. We looked at the position in
December 2007. I discussed it with the Permanent Secretary. We
were clear about two things: first, the pre-appointment hearings
process was not in operation at that point. Indeed, Ofqual was
not even on the list and it took us six months until June before
it was added. We were clear though that, in future, it should
be a post which had a pre-appointment hearing. Secondly, we were
also clear that we did not want to have Ofqual seeming to be less
independent and stable during the transition. We made a decision
that we would appoint somebody through the full independent OCPA
procedure in January, February and March of that year who would
be clearly the chair of interim Ofqual and would then become the
chair of permanent Ofqual. We set that out clearly in the job
advert. We did not have a statement about pre-appointment hearings
because they did not apply to Ofqual at the time. We said clearly
in the Written Ministerial Statement to Parliament in April 2008
that that was our intention. It was confirmed in writing to you
in the spring of 2008 and announced in Parliament that, while
future appointments to be chair of Ofqual would be subject to
the pre-appointment hearing, that would not apply to Kathleen
Tattersall because she had been appointed before the pre-appointment
hearings process on the basis of a job advert that did not specify
a pre-appointment hearing. We thought that it would be inappropriate
to destabilise Ofqual at the point of transition by going through
a new appointments process. If at any point, during that two-year
period—as I said, I wrote to you in December 2007 asking
for your views—you felt that there should be a pre-appointment
hearing, contrary to what was clearly set out in my statements,
letters, Written Ministerial Statements and by Sarah McCarthy-Fry
in the House of Commons and Jim Knight to you, you could have
done so. But you didn't do that, Chairman.
Q5 Chairman: Secretary of
State, as you pointed out, I was the person on the Liaison Committee,
as Chairman of this Committee, who argued for all four to be within
the pre-appointment range.
Ed Balls: You succeeded in that.
Q6 Chairman: We succeeded
in that, but then the surprise was to find that with the way in
which these were conducted, with a piece of legislation stretching
out into the future, we ended up with no opportunity of a pre-appointment
hearing for one of the most sensitive education posts in our country.
Sitting there as Permanent Secretary and Secretary of State, I
would have thought that someone would have said, "Wouldn't
it be better if we were very keen for this new regulator to be
seen, with all the problems that there were over QCA, the testing
fiasco, the resignation of Ken Boston and the hearings of this
Committee?" Wouldn't it have been the view in the Department
at some time that it would have been better off if that pre-appointment
hearing had been arranged in some way? I have to bring you back
to the fact that that piece of legislation was passed a month
ago—only a month ago. Ofqual will not become a real entity
until 1 April this year—2010.
Ed Balls: I understand, Mr Chairman,
but it is important to understand how proper appointments procedures
work. The appointment of Kathleen Tattersall as interim and then
permanent chair of Ofqual was done under the full independent
OCPA process. That says that "if the appointment may be subject
to a pre-appointment hearing, the following words must be used
in any advertising or other form of publicity ...". That
wasn't done in the advert in January 2008 because at that time,
the pre-appointments process wasn't operational, and in any case,
Ofqual wasn't on the list. I wrote to you in December 2007 to
ask for your views. I did a Written Ministerial Statement following
the job advert, making it clear that Kathleen Tattersall was being
appointed as an interim and then as permanent chair for reasons
of stability in Ofqual during the transition. That was confirmed
in a letter to you in March 2008 by the Schools Minister, was
confirmed to the Committee[2]
in the House of Commons in April 2008—sorry, in 2009; the
letter from the Schools Minister was from February 2009—and
then in Hansard on 24 March 2009. We were always clear
that the first appointment as interim chair, Kathleen Tattersall,
was, as the job ad. said, the person who would then become the
permanent chair to steer independent Ofqual through the transition.
At no point in that whole process was it ever raised with me or
the Schools Minister by anyone, including your Committee, that
Kathleen Tattersall should come back for a pre-appointment hearing.
As I said, it wouldn't be legal to do so, given that the job advert
in January 2008 didn't have a reference to pre-appointment hearings.
In retrospect, your view is that there should have been a pre-appointment
hearing. Unfortunately, that was not our view in December 2007,
and it wasn't a view that you expressed to us at the time. That
is why we proceeded in the way that we have—in the best
interests of Ofqual.
Q7 Chairman: Secretary of
State, there has obviously been a miscommunication between us.
We meet both formally and informally very regularly. I have to
tell you that I assumed, from the very beginning, in the changes
from the QCA to Ofqual and the QCDA, that we would, at some time,
have a pre-appointment hearing. That may be because of miscommunication
or because I thought that—certainly, this is the view that
I expressed in the Liaison Committee and here—the Government
were very keen to make these pre-appointment hearings work, especially
in this very sensitive area where a degree of independence from
the Department seemed a priority. There is obviously a miscommunication
here.
Ed Balls: I have to say, Mr Chairman,
it was not through lack of communication, as I have set out clearly
here. The point at which you wrote to the Cabinet Office to say
Ofqual should be included was after the advert had gone into the
newspapers and the appointment had been made.[3]
It clearly said that the interim chair of Ofqual would become
the chair of Ofqual, without any reference to pre-appointment
hearings.
Q8 Chairman: This is why I
feel that this is a bit of a sleight of hand in the sense that
you knew—
Ed Balls: That is your accusation,
Mr Chairman, which I entirely reject. I entirely reject the idea
that the Permanent Secretary and I, through sleight of hand, set
out to avoid scrutiny. That is entirely untrue. As I said, I wrote
to you in December 2007 asking for a discussion on Ofqual scrutiny,
but we have not had such a discussion. It is absolutely clear
in the job advert, in the Jim Knight letter to you in March, then
in the ministerial statement, then in the press notice, then in
the letter in February and March[4]
the following year, that our intention in the case of the first
interim chair was for the first interim chair to become the permanent
chair. It was absolutely clear; there was no miscommunication
on our part at all. I am clear that future chairs should be subject
to pre-appointment hearing. But not in this instance, with this
case, because we made the appointment before the system was up
and running, so the accusation that there was a sleight of hand
I reject.
Q9 Chairman: I only use "sleight
of hand" in the sense that, here we were—
Ed Balls: You said some other
things, Mr Chairman. I think "sleight of hand" is probably
one of the more polite.
Q10 Chairman: It is true that
some members of this Committee feel a bit cheated, because the
Prime Minister wants to have pre-appointment hearings. This is
one of the most significant appointments under the remit of this
Committee. As soon as there was an opportunity to bid for this
to be a pre-appointment hearing appointment, I bid for it, and
I got it. Then it transpires that we did not get a pre-appointment
hearing of this very important post.
Ed Balls: But as I said, the next
chair of Ofqual will be subject to the new pre-appointment hearing
process, which has been up and running since the summer of 200
. This post was advertised in advance of that, on the basis of
an advert that made it very clear—without the OCPA guidelines
and wording on pre-appointment hearings—that the interim
chair would effectively be operational from the beginning, independent
of QCA and the Department, and that therefore there would not
be a second bite at the cherry for Ministers, or for anybody else,
to reconsider her appointment. We did this not for reasons of
sleight of hand or to cheat the Committee. We did this because
we wanted to give Ofqual independence and stability from the beginning
as it managed its transition. Ofqual, through the period of the
difficulties of national curriculum testing, was acting independently
of the QCA and ourselves in monitoring the testing system, even
though, as you say, in law it did not yet have that independence.
It was that desire—to be honest, it has happened in the
past with Bank of England independence in 1997, when the Bank
of England operated independently for a year before the legislation
was passed, or in the case of the Financial Services Authority,
where the chair of the FSA was in post in practice independently
for a longer period before the Financial Services and Markets
Bill came in. It would have been ridiculous for us at the time
to have said, "Eddie George will be appointed as the head
of the new Bank of England, but will be reappointed once the legislation
comes in." It was the same with Howard Davies. I took the
decision, rightly or wrongly, and on the advice of the Permanent
Secretary, that to have from the beginning an operationally independent
Ofqual, we should treat it as such from the beginning, even though
it would take some time for the legislation to come in. We were
absolutely clear about that in all our communications to you and
to Parliament. The suggestion that we acted to try to cheat or
to use sleight of hand to avoid proper scrutiny is really not
correct, Mr Chairman.
Q11 Chairman: The fact of
the matter is, Secretary of State, we feel there should have been
a pre-appointment hearing. The spirit of the Government's intention
was on our side. You have gone through the detail and I think
assured yourself that you went through the right number of letters
and so on. In terms of timing, I do not agree with you. Over this
period of time, it is strange that I and the Committee felt there
would be a pre-appointment hearing. You have pointed to letters,
including Jim Knight's quite late letter on this, which confirmed
a position that we did not understand was the true position. I
have spoken too long. Graham.
Q12 Mr Stuart: Secretary of
State, may I take you back to the advertisement? Would it have
been possible to have added words to the advertisement to say,
in the spirit of the announcement by the Prime Minister in the
middle of the previous year, that the appointment might be subject
to scrutiny by this Committee?
Ed Balls: As I said, we made a
decision in December 2007 that—given that the new arrangements
were not operational, that Ofqual was not at that time even on
the draft list and that we wanted to have stability in the transition—it
would not be appropriate to push ahead and to say that there would
be a second pre-appointment hearing at a later stage. The right
thing to do was to give Ofqual stability and independence in its
transition from non-statutory to statutory independent regulator.
It was a decision that we made in December 2007 not to go down
that road. It is a decision that we could have discussed. As I
said, I did write to the Chairman of the Committee offering discussions.
It was a decision we took not to do so.
Q13 Mr Stuart: So you decided,
in December, notwithstanding the Prime Minister's promise earlier
in the year, specifically to exclude the Select Committee from
approval of that appointment—
Ed Balls: Absolutely not.
Mr Stuart: Even though, the whole point
of that position was that it should report, not to you, as do
most of these positions, but to Parliament through this Committee.
There was a letter—which we accept; we have heard about
it at least three times now—sent in December [2007], which
asked the Select Committee to respond on how best to deal with
this. What that letter did not say was, "We have to consider
this key appointment of a person who will report to Parliament
through you, and we are coming to a decision on it." What
it actually said was, "Please talk to us about the general
process." At the same time, you were making that decision.
It sounds to me like you wrote the letter as a sort of cover—as
some people might see it—for making a decision explicitly
and deliberately to exclude this Committee from any scrutiny of
that position.
Ed Balls: That would be an entirely
untrue reading of what happened. At the time of the appointment
and the advert for the interim chair, there wasn't an operational
pre-appointment hearings process. In fact, there was a consultation
going on and Ofqual was not on the list. We couldn't possibly
wait until the system was operational to move ahead with the appointment.
Q14 Mr Stuart: Secretary of State,
to be operational, all they had to do was come and see this Committee,
through whom they would report to Parliament. It would not take
a huge machinery of Government exercise for them to be able to
come and speak to this Committee.
Ed Balls: That was not the position
we were in at the time. The pre-appointment hearings process was
being discussed; it wasn't operational. As you know, the Chairman
of the Committee wrote before the system became operational to
make the point about the inclusion of Ofqual. We had a decision
to make, though, which was, as I said, an entirely separate decision
in our minds that was not linked to the issue of pre-appointment
hearings. It was whether to appoint an interim chair of Ofqual
and then re-appoint or re-advertise when the law came into effect.
The judgment that we took was that it was very important for Ofqual,
pre its statutory basis, to act de facto as the independent regulator,
as, in my mind, had happened with the Bank of England and the
Financial Services Authority between 1997 and 1998, or 1997 and
2000. First, we wanted it to become immediately de facto independent.
Secondly—
Q15 Mr Stuart: Shouldn't you
have discussed it with this Committee?
Ed Balls: Well, as I have already
said, and I am not going to say it more than four times, I wrote
to the Committee offering discussions and I did not get a reply
to the letter.
Q16 Mr Stuart: Not specifically
on the key point that you were wrestling with. You said that you
had to wrestle with it. You made a decision about someone who
is supposed to be independent of you, who is supposed to report
not to you but to this Committee. You decided—and I am not
doubting that you did so for the best possible reasons. On what
basis did you decide that you were the appropriate person to decide
about this independent appointment? Don't you regret, looking
back on it and the fact that you are here today, that you did
not involve the Select Committee—even if only the Chairman—through
which that person and appointment is supposed to report to Parliament,
rather than unilaterally making the decision yourself, regardless
of the merits of that decision?
Ed Balls: Well, no. We proceeded
on what we believed was the best way forward, which was not to
destabilise Ofqual halfway through its de facto independence by
having a reappointment. We set out clearly in the job advert that
the person who would be appointed would be chair of interim Ofqual
and then would become chair of Ofqual at the point of Royal Assent
and commencement. We were absolutely clear about that in the job
advert; it was there to see in January 2008; it was the basis
on which we announced the appointment in the Written Ministerial
Statement in April 2008; and, in fact, it was something that the
Schools Minister explained to the Committee a month before in
2008. To be honest, I think that we acted in an open and transparent
way. Our motivation was the public interest, stability and independence
of Ofqual. At no point at that time did it ever occur to us that
we were making a decision that would undermine the Committee's
role in proper scrutiny.
Q17 Mr Stuart: The question
is, should it have done, Secretary of State?
Ed Balls: I think that is a matter
for the Committee.
Mr Stuart: In December 2007, why didn't
you—
Ed Balls: It is a matter for the
Committee to reflect upon. We encouraged the Committee to take
evidence from Ofqual, which you have done, although not on a large
number of occasions. We wrote to you more than once encouraging
you to think about how you would scrutinise the role of Ofqual—
Mr Stuart: While you were taking the
key decision without telling us.
Ed Balls: Well, you keep saying
to me that you don't want me to go through the myriad number of
times that we did inform the Committee—
Q18 Mr Stuart: I am taking
you back to December—the key decisions, Secretary of State,
were taken in December 2007. You have told us that you decided
in December 2007, at or around the time you wrote a letter in
general terms to the Committee, how this independent appointment—independent
of you, independently reporting to Parliament—should be
appointed, whether that person should stay in post and whether
they should be subject to pre-appointment hearings or reappointment
hearings. You decided unilaterally. That is what we are talking
about. You can rehearse all you like from 2008 onwards, but what
I am interested in and what the Committee is particularly interested
in is why you made that decision to exclude the Committee at that
time, and why it did not occur to you to involve the Committee
then.
Ed Balls: No decision was made
to exclude the Committee. In fact, the opposite—we had written
to the Committee encouraging it to consider how it would scrutinise.
The decision we made—the material decision—was that
we wanted to appoint someone who would not be appointed to an
interim role, subject to reappointment, but would be de facto
the independent chair of Ofqual from the beginning, which is why
the job advert made clear that the independent chair would become
the permanent chair. That was the decision, and we made that decision
for, I think, the absolutely best of reasons: to secure the independence
and stability of Ofqual during that transition. The consequence,
because the pre-appointment hearings started subsequently and
because there was not going to be an appointment but only the
confirmation of a previous appointment, was that at that point
there was no chance for any further scrutiny. As I said, that
was set out to the Committee by the Schools Minister in February
of last year and to the Opposition party by the then Schools Minister,
Sarah McCarthy-Fry, in the Bill Committee of the House. At no
point, Mr Stuart, did you or anyone else ever raise the issue
of pre-appointment hearings at all, because that wasn't the salient
issue of the time. We did not make any decision to exclude the
Committee. We made the best decision, as we saw it, to secure
the independence and stability of Ofqual through the transition.
I stand absolutely by that decision.
Chairman: The Permanent Secretary wants
to come in on your question.
David Bell: I just want to reinforce
the point about the Secretary of State taking the material decision—certainly
the conversations that we had very much focused on that. I was
strongly of the opinion that it was important to maintain the
stability from the interim through to the substantive position.
I just want to reinforce the point that that was the key decision
that had to be made. My advice was very strongly—but the
Secretary of State obviously made the decision—for the continuity
from the interim to the substantial position.
Q19 Mr Stuart: So you decided
on an independent appointment that reports to Parliament—in
your opinion and on your decision—without telling us. We
would rather have the stability; we do not want to destabilise
Ofqual—
Ed Balls: With respect—
Mr Stuart: Let me finish my question.
Secretary of State, wait. You decided—
Ed Balls: With respect—
Mr Stuart: So you decided that not destabilising
Ofqual was more important than the parliamentary scrutiny of that
position, notwithstanding the Prime Minister's announcement in
the middle of the year about reinvigorating parliamentary democracy
and putting Parliament at the centre of such decisions.
Ed Balls: Mr Stuart, Ofqual did
not exist at the time that we made the decision. In fact, Ofqual
did not exist at the time that we made the appointment. We appointed
Kathleen Tattersall to be a member of the QCA board. However,
we made it very clear that, although at that point there was no
legal basis, we wanted Ofqual, in shadow form, to exist as a proper
independent regulator, and we made that very clear in the job
advert.
Q20 Mr Stuart: You could have
allowed her to come here.
Ed Balls: It was entirely proper,
in advance of the legislation, for us to move ahead and appoint
Kathleen Tattersall as the interim chair and then the permanent
chair. As I said, the analogy is with the Bank of England in 1997
and with the Financial Services Authority in 1997, until the Financial
Services and Markets Act 2000 was passed. That was our motivation.
The chair of Ofqual is our appointment,[5]
under the legislation that has now been agreed by Parliament,
but it was entirely appropriate for us to draw up the job advert
and proceed with the appointment through the independent processes.
As I said, despite your accusations, we were not seeking in any
way to undermine parliamentary scrutiny. In fact, for the first
time, we are legislating for a regulator who would report directly
to Parliament. So the whole reform was about strengthening Parliament's
role, not weakening it.
Chairman: Karen, you wanted to come in.
Q21 Ms Buck: I just wanted
to go back to the question of what was put in the advertisement,
and the legal sense and principle behind that. In the case of
extensions generally and of reappointments, what is your understanding
of what should happen if an extension or reappointment falls after
a job has originally been advertised without that qualification?
Does that mean that all future extensions and reappointments would
not be subject to scrutiny in the House?
Ed Balls: I think the answer to
that is yes. The August 2009 guidance said:"Departments should
note that pre-appointment hearings only apply to appointments
of new candidates-and not to extensions or to re-appointments.
Select committees already take evidence from serving post-holders
as part of their on-going scrutiny of public bodies and public
appointments." The OCPA code says: "If the appointment
may be subject to a pre-appointment hearing, the following words
must be used in any advertising or other form of publicity:
`In line with Governmental proposals to increase Parliamentary
Scrutiny of appointments to key posts, the preferred candidate
for the post of [insert details] may be required to appear before
a Parliamentary Select Committee prior to appointment.'"
So regarding the decision that we made at that time, once we decided
to have one chair who handled the transition from interim to full
Ofqual post-legislation, the combination of the guidance, as it
was subsequently written, and the OCPA guidelines makes it absolutely
clear that it is not possible to have a subsequent pre-appointment
hearing. So even if the Select Committee had come to us in November
2009 and said, "Before Royal Assent, we would need to have
a pre-appointment hearing for the chair of Ofqual", I am
afraid that that would not have been possible, under both the
August 2009 guidance and the OCPA regulations, because the job
had already been advertised 18 months before as a job that would
move from interim chair to full chair, and Kathleen Tattersall
had been appointed on that basis.
Q22 Chairman: But you have
just said, in answer to Graham Stuart, that there was no legal
basis for the appointment.
Ed Balls: No, there was no legal
basis for Ofqual, but there was a clear legal basis for the appointment
and the advertisement makes it absolutely clear: "The interim
regulator will be established as a committee of the QCA: the successful
candidate will therefore be appointed as a member of the Board
of the QCA and will chair this committee. Subject to Parliament
passing the necessary legislation, the Chair of the interim regulator
will become the first Chair of the new, independent Office of
the Qualifications and Examinations Regulator in due course and
will step down as a QCA board member at that point." So the
job advert in January 2008 makes it absolutely clear that the
person appointed will move from being a QCA board member to a
separate chair of Ofqual once the legislation comes into effect.
Q23 Chairman: Don't you think
that some of our Yorkshire constituents will read that and say
that here is an appointment where something is being set up as
a shadow. This organisation has no legal basis—as you said—because
it doesn't exist. A person is appointed to this organisation that
is a shadow. Nearly two years later, when it gets a formal legislative
basis and can exist within that legal basis, it is too late for
us to have a pre-appointment hearing.
Ed Balls: As I say, in retrospect,
and in recent weeks, that is your view. That is not a view that
was ever expressed by you or any member of your Committee to me
at that time.
Q24 Chairman: Secretary of
State, as you know and you have been to the Committee, I asked
for Ofqual to be one of the four positions—in fact, I asked
for more than four—that we were awarded for pre-appointment
hearings when we thought pre-appointment hearings were important.
Ed Balls: Absolutely right.
Chairman: So it would seem strange that
I would suddenly go off the boil, and not be interested in a pre-appointment
hearing for something that I fought to get.
Ed Balls: But as I said, you wrote
to the Cabinet Office on that point after the job advert and the
appointment,[6]
and after Jim Knight's letter to you setting out the basis on
which we were proceeding.
Chairman: No, Jim Knight's letter was
from 2009.
Ed Balls: No, Jim Knight's letter
was from 10 March 2008, in which he wrote to you following his
appearance before the Committee on 18 February 2008. In a section
of his letter, he sets out the appointment to the new independent
regulatory body for qualifications. He sets out: "The Chairman
of the interim regulator is being recruited under the Office of
the Commissioner for Public Appointments rules, and will become
the first Chair of the Office of the Qualifications and Examinations
Regulator." So that is all set out to you in March 2008—a
month before the appointment in April 2008 and two months before
you wrote asking Ofqual to be "added in".[7]
It makes it absolutely clear, as did the Written Ministerial Statement
which I read out earlier, that Kathleen Tattersall will become
the new chair of Ofqual once Royal Assent occurs. It is perfectly
legitimate for you to take the view now in retrospect that we
made the wrong decision to appoint an interim chair and make it
clear that that person would become the chair. That was clearly
our decision.
Q25 Chairman: Secretary of
State, some members of the Committee are feeling aggrieved because
I wrote to the Chairman of the Liaison Committee on 19 February.
Ed Balls: That's right. I thought
it was in May. In that case, I apologise.
Chairman: It was on 19 February, saying
that I wanted Ofqual to be one of the groups.
Ed Balls: The Schools Minister
wrote to you in March 2008, making it clear that we were appointing
an interim regulator who would become the full chair on the basis
of a job advert that had been put into the newspapers in January,
before your letter to the Cabinet Office.
Chairman: We never received that letter.
We never received a letter saying that there would be no pre-appointment
hearing when it became a permanent post.[8]
Just hold that for a moment because David wants to come in.
Q26 Mr Chaytor: Secretary
of State, do your arguments regarding the chair of Ofqual apply
in exactly the same way to the appointment of the chair of the
QCDA?
Ed Balls: They do.
Q27 Mr Chaytor: Is there any difference
whatsoever?
Ed Balls: There is no difference
at all.
Q28 Mr Chaytor: You will appreciate
that from the Committee's point of view, we have four posts that
are eligible for pre-appointment hearings, two of those have been
disqualified because of the interim arrangements that the Department
established. For one of them, we have held the hearing, made a
recommendation and you have turned down our recommendation, and
for the fourth, if the Chief Inspector were to be reappointed,
that position would not be subject to an appointment hearing.
In terms of our share of the hearings, we have not done terribly
well out of the divvying up.
Ed Balls: As I said, in January
of that year [2008] neither the QCA nor Ofqual were on the list.
Both you and I made clear representations that they should be,
but we had to move ahead and make appointments in the meantime,
before the system was operational. The QCA chair was advertised
in May that year, before the OCPA guidance and the Cabinet Office
guidance was operational. In retrospect, you're looking back and
saying, "We wish that there had been pre-appointment hearings
for those appointments, although they were before the system had
been announced and the guidance was in place." At that time,
the imperative for us was to move ahead and make appointments
for important positions.
Mr Chaytor: I was trying to look forward.
Ed Balls: In future, they will
absolutely be subject to a pre-appointment hearing.
Q29 Mr Chaytor: What do you
think is the real reason for interim appointments or reappointments,
or extensions of appointments not being subject to pre-appointment
hearings? Is there any logic to the case at all? I understand
the point about continuity where one organisation is being restructured,
but in the normal course of events, for example, if the current
Chief Inspector was to be re-appointed, what would be the reason
for not having a pre-appointment hearing? These are not confirmation
hearings on the US congressional model. What are the reasons for
excluding re-appointments?
Ed Balls: To be honest, I can't
answer that, because I don't know the answer. I have not been
subject to the discussions that have happened in the Liaison Committee
or the Cabinet Office.
Q30 Mr Chaytor: Therefore,
would you be content for such re-appointments to be subject to
hearings?
Ed Balls: I think—I have
to be careful here, as this is my personal opinion—that
if you have a fixed term appointment, and then have a decision
to have a new term, it is de facto a new appointment. There may
be a case in having re-appointment hearings—that would be
my instinctive reaction, although the Permanent Secretary can
tell me why there may be arguments on the other side. The point
that I am making is that, in the case of interim to full Ofqual,
that wasn't, in a sense, a conventional re-appointment after a
fixed term; it was an organisation that had already been doing
a very important and good job without a full legal basis moving
into full legal operation. To destabilise the organisation at
that particularly crucial time seemed to be completely against
the public interest. That is a particular and unusual circumstance,
as I said, with an analogy in the Financial Services Authority.
Q31 Mr Chaytor: On the general
issue, can I ask the Permanent Secretary to answer?
David Bell: I think the answer
might be related to the OCPA guidance, on the grounds that if
you were going to change it, you would have to change the OCPA
guidance, because it would say, "Unless you made it clear
in the beginning of the process that a re-appointment was subject
to, as it were, a second hearing", but that would be a matter
for OCPA. I think this is a matter that would have to be considered,
but I think that's the explanation. Can I add one technical point?
In relation to the QCDA, the legislation that created it is essentially
just renaming the QCA, so the chairman, once appointed, has not
been subject to even consideration for re-appointment or new appointment;
this is the same organisation in law. As the Secretary of State
said, the original appointment of the QCA, now QCDA, chair, took
place prior to the list finally being approved of pre-appointment
hearings.
Q32 Paul Holmes: The Cabinet
Office guidance says that re-appointments or extensions should
not be subject to pre-appointment hearings. The Secretary of State
has been very brave and said he disagrees with Cabinet Office
guidance.
Ed Balls: I gave a personal opinion
that that was my instinct.
Q33 Paul Holmes: I just wonder whether
I could take you into another personal opinion. I'm moving away
from the specific cases that we've been talking about here, because
we have probably exhausted that now. In future, when pre-appointment
hearings take place—as with the one we had on the Children's
Commissioner—should the hearing always take place at the
end of the process, effectively, when a successful candidate has
been chosen and even been told that they have the job already,
as happened with the Children's Commissioner. Is that when the
pre-appointment hearing should take place, in your personal opinion?
Or should the pre-appointment hearing be earlier in the process?
Ed Balls: That raises wider questions
about the whole Nolan appointment process and the way in which
these appointments are made. As I understand it, these are not
appointments that are being made on the basis of a long list by
elected Ministers. They go through a full Nolan process, at the
end of which there is sometimes a choice of one or two people.
In that circumstance, the purpose of the pre-appointment hearing
is to ensure that there aren't problems, issues or financial difficulties
that had not been made aware to the Nolan process, which casts
doubt on the wider suitability of the candidate for the post.
In the way that the Nolan process works, that would be equivalent
to saying that there would have to be parliamentary scrutiny from
the move from a long list to the short list. That would be a fundamental
change to the whole public appointments process.
David Bell: I think that there
is a practical point as well. When people are applying for public
appointments, there is usually a quite confidential process. For
good reasons, people do not necessarily want to destabilise their
current employer by making it clear that they are out in the open.
If you did have a scrutiny process or a pre-appointment process
at the point at which people were not confirmed in post, I fear
that that would become a very significant disincentive to good
candidates, because out there in the open would be their interest
in the job. If you apply for a job and don't get it and that has
been kept very confidential, there is no wider impact on the organisation
that you might be leaving.
Q34 Paul Holmes: But doesn't
that mean then that pre-appointment hearings are a complete waste
of time? I think it was the Cabinet Office guidance that came
out when we were talking about the Children's Commissioner and
that said that only in the most exceptional circumstances would
a pre-appointment hearing be expected to lead to refusing the
successful candidate. What is the point then?
Ed Balls: Isn't the answer to
that that knowing that you will be subject to parliamentary scrutiny
and questioning is something that you have to take on board when
you read the job advert and then decide to apply for the post?
If somebody has not taken that on board and subsequently finds
that there are problems that had not been brought to light, they
will have nobody but themselves to blame if it is absolutely clear
that this is an important part of the process. I am sure it has
an impact, although, as David said, it will not have as big an
impact as it would at an earlier stage in the process. Believe
me, the reason why OCPA is so sensitive about this is precisely
because the fact of scrutiny before final appointment is something
that candidates think very hard about before applying for jobs.
Q35 Chairman: We have already
been told by the Chief Inspector of Schools and Children's Services
that she would not have applied for the job if she had had to
have a pre-appointment hearing.
Ed Balls: In which case it has
teeth.
Q36 Chairman: We really need
a change in culture in order to get these pre-appointment hearings
working effectively.
David Bell: The observation I
would make is that often when people are undertaking applications
for public appointments, it might be the first time they have
been subject to this kind of scrutiny. I heard what the Chief
Inspector said, and I think it was an interesting observation.
There might be candidates out there who decide not to apply for
jobs as a result of pre-appointment scrutiny. My view, however,
is that if you are applying for a public appointment you just
have to accept that it goes with the territory to be put under
scrutiny by parliamentarians and others. So, I think that it is
a reasonable aspect of the process and should not deter good and
capable candidates.
Q37 Paul Holmes: But that
implies that pre-appointment hearings are just a dress rehearsal,
a practice for their future appearance in front of a Committee,
rather than a pre-appointment hearing.
David Bell: No, I wasn't implying
that. What I was saying was that I think it is a fact of life
that if you are undertaking a public appointment that is something
that you will have to get used to. It seems that it is a reasonable
part of the pre-appointment process to assess how well candidates
are responding to questions and what kinds of answers they are
giving. That does not, however, undermine the basic position which,
of course, is that it is ultimately the decision of the relevant
Secretary of State.
Q38 Chairman: Is it a pre-appointment
hearing, if the Children's Commissioner was told she had the job
before she came before the Committee?
David Bell: Well, the issue was
that she was told that there would be a pre-appointment process,
in other words that the final and ultimate decision was the Secretary
of State's, which was always the case. It was never anything other
than what had been said all the way through the process. The candidate,
ultimately, was told that she would have to undergo pre-appointment
scrutiny, so there was never an issue about not being told.
Ed Balls: I think it was in the
public domain. It was publicly announced that she was appointed
subject to the hearing.
Q39 Chairman: But what about
the terminology—pre-appointment hearing—if someone
is told they have got the job?
Ed Balls: I think you are raising
wider questions about the operation of the system, on which you
have influence through the Liaison Committee, but for us making
appointments, we are working in the system as we find it.
Q40 Helen Southworth: I am
seeking clarification. In terms of the four posts that are subject
to pre-appointment hearings before this Committee, how many reappointments
could be made for each of them prior to the current postholder
no longer being able to hold the post?
David Bell: The usual OCPA guidance
is that you can have one additional term after the period in which
you have been appointed, but it is very, very exceptional to be
given a second period after that, so if you are appointed, say,
for four years, you can, subject to decisions of the relevant
Secretary of State, be appointed beyond that, but after that,
OCPA would say one extension is sufficient and you have to put
the post back out to public advert.
Q41 Helen Southworth: So in
terms of this particular post, when would that occur?
David Bell: We have just made
an announcement recently. It's another three years, because we
had actually announced—I am sorry; I'll just get my papers
on this one. I do apologise, but I would like to write to you
on that.[9]
We have just announced recently—
Q42 Helen Southworth: So if
it were another three years, that would be 2016?
Ed Balls: No. The first appointment
was in April 2008, so there has been a two-year term, followed
by three years in the formal legal position of chair of Ofqual.
The issue wouldn't arise in the large majority of cases.
David Bell: 2013 will be the point
at which there would be a new appointment to the Ofqual post.
Q43 Chairman: Vernon Coaker's
letter was very clear on this. It's three years from 1 April this
year, so it will be five years before we have any hope of a hearing,
of a new applicant.
David Bell: But I think, as the
Secretary of State said earlier, the rules as they apply at the
moment are that reappointments are not subject to a pre-appointments
process, so in fact the point you've made about Ofqual is not
just a point that would apply to the Ofqual postholder. It would
also apply to other public appointments—i.e. the four that
are in this Committee's domain.
Q44 Mr Pelling: I would like
to ask a Tony Travers-type question, if I may. Why would a Secretary
of State have a different perspective on these matters from members
of a Select Committee or, indeed, members of Opposition parties?
Ed Balls: Sometimes, as a matter
of principle, members of Opposition parties have a different view
from the view of the Secretary of State. I am certainly not suggesting
that's arisen in this case, but abstracting from that, I don't
think there's any reason why there would be a difference of perspective.
As far as I'm concerned, parliamentary scrutiny of key appointments
is an important part of the work of Select Committees and I support
it 100%.
Q45 Mr Pelling: Yes, but there
seems to be a question in this discussion as to just how meaningful
that process is. I would have thought there would be justifiable
reasons why the Secretary of State would have a slightly different
perspective in terms of effective recruitment, which has been
one of the questions that have been asked this afternoon.
Ed Balls: The important thing
is to be clear on what basis these appointments are being made.
These aren't appointments of Parliament; they're appointments
of the Government,[10]
but the Government's decisions are scrutinised and that's right
and proper. In this case, what is being strengthened is that,
rather than the scrutiny beginning after the formal beginning
of the appointment, the scrutiny starts at an earlier stage. That's
a strengthening of the position in terms of parliamentary scrutiny,
which personally I fully welcome.
Q46 Mr Pelling: I think the
process that's gone through is trial and error, and no doubt these
things progress through trial and error, but the Secretary of
State said this isn't an appointment of Parliament; this is an
appointment of Government. Could you clarify what you mean by
that?
Ed Balls: Well, it's a Crown appointment
in the case of the chair of Ofqual, on the basis of the recommendation
of Crown servants.
Q47 Mr Pelling: So it is an
appointment of Parliament?
Ed Balls: It's an appointment
of the Crown, on the advice of Ministers of the Crown.
Q48 Mr Pelling: Okay, so it
is an appointment of Government?
Ed Balls: It's an appointment
of the Crown.
Q49 Chairman: For the uninitiated,
who might not understand this, what is the difference between
the Children's Commissioner appointment and the QCDA appointment
and the other two appointments, then? What is the difference for
the layman?
Ed Balls: I think that in the
case of the Children's Commissioner, the Children's Commissioner
is an appointment of the Secretary of State. In the case of the
chair of Ofqual, it is an appointment of Her Majesty, on the advice
of her Ministers.
Q50 Chairman: Right, and what
difference does that make?
Ed Balls: The difference is that
formally it's an appointment of the Crown, rather than an appointment
of Ministers. The analogy would be the Governor of the Bank of
England is appointed by the Crown; the members of the Monetary
Policy Committee of the Bank of England are appointed directly
by the Chancellor of the Exchequer. That probably means that the
Governor has a greater status as a direct Crown appointment than
the members of the Monetary Policy Committee. A wider process
of consultation occurs before the decision on the appointment
of the Governor of the Bank of England, than on the appointment
of a member of the Monetary Policy Committee. In both cases, however,
they are made on the advice of the Chancellor of the Exchequer.
David Bell: My understanding of
this is that it is also something to do with the independence
of posts, for example in relation to regulators or inspectorates.
For example, the Chief Inspector's post, which is one of the posts
here subject to scrutiny, is also a Crown appointment. My understanding
is there is no absolute science about this, but that's been generally
used, as has, perhaps, the status of the body, so it's a non-ministerial
Government department, and it also happens to be our regulator
or inspectorate.
Ed Balls: It was certainly something
that we were very keen to see, and the chair of Ofqual will be
a Crown appointment—for that reason of status and independence.
David Bell: We did draw the exact
parallel with Ofsted. Again, it was something about the independence
of the most senior appointment being a Crown appointment in Ofsted,
and we felt that that should be replicated in Ofqual.
Q51 Chairman: But Secretary
of State, Permanent Secretary, doesn't that take us back to the
very heart of why, I think, both of you feel we are unfair to
you because we are upset about this appointment? It goes back
to "The Governance of Britain", the Government's ambition
to reinvigorate our democracy, and the foreword by the Prime Minister,
which said the pre-appointment hearing would be at the centre
of the reinvigoration of Parliament. The two Crown appointments
that you have talked about are very different; these people, when
they are appointed, report to Parliament through this Committee.
I used strong language, which I know you, Secretary of State,
didn't like, about sleight of hand, and a bit of cheating—we
felt we had been cheated—because whatever the technicalities
and the letters that went to and fro, we believed that we would
end up with a pre-appointment hearing on the totally new, powerful
position that safeguards our examination system and our standards
in this country. We really believed that. That is why we are upset.
In terms of the spirit of what should have happened, I think,
and the Committee thinks, we should have had a pre-appointment
hearing. I know that you've gone through the detail and you don't
want to go over it again, but can I just express that we accept
what you've had to say, there is a disagreement between us, but
I hope you can understand why we felt aggrieved that we end up
with a Crown appointment, and a vital appointment that is very
important to the education sector, and we didn't get our pre-appointment.
Ed Balls: As I said, in retrospect,
I'm sure you wish as I do that both of us had followed up my December
2007 letter and had the discussion to make sure that the scrutiny
in your mind was as strong as it could have been from the beginning.
That didn't occur. The only point at which I baulked was the language
around sidestepping, which gives the impression that we set out
with the motive to avoid scrutiny. I can say—and the Permanent
Secretary can speak for himself—at no point was that ever
part of our motivation at all.
Q52 Chairman: Secretary of
State, that might have been slightly coloured by the fact that
the Committee unanimously had an opinion about the Children's
Commissioner, and you basically brushed that opinion aside. That
was the background to the fact that we then led into the other
major appointment for which we were to have a pre-appointment
hearing and that was not going to happen. Okay, there was some
confusion about the shadow Ofqual chairman and the real Ofqual
chairman, which must have puzzled anyone listening to these deliberations.
Ed Balls: I am sure that it will
not have puzzled you, Mr Chairman, because you are a close follower
of these matters and understand the detail, as well as the broad
brush.
Q53 Chairman: I always thought,
when it became a permanent appointment, that we would have had
a pre-appointment hearing.
Ed Balls: I understand that, although
the Written Ministerial Statement made it absolutely clear two
years ago that that would not be the case, in the case of the
appointment of Kathleen Tattersall, and that is something which
we all wish had been more fully understood at the time.
Q54 Chairman: Do you think
that these pre-appointment hearings are really worth carrying
on with?
Ed Balls: I think that they are
a good thing, but I do not think that they are necessarily yet
perfect. As Mr Pelling said, people are learning from this process.
It is something that has to be suited to a proper understanding
of the way in which Parliament works and the Executive work. I
would say that I support them, but I would not say at the moment
that they are working perfectly. There is more that we can do
to make them better.
Chairman: Thank you.
Ed Balls: Can I say one other
thing to you, Mr Chairman? For the avoidance of confusion, I have
written to you this afternoon on an entirely separate matter.
I would not want to have written to you and—
Mr Pelling: The letter got lost—
Ed Balls: I wasn't going to say
that. It is relevant to the scrutiny of our legislation that concerns
have been raised in Parliament in the past week about the use
of physical punishment in part-time educational and learning settings.
It was raised by my hon Friend the Member for Keighley in the
debate last Monday. It is something that I have discussed with
her and also with the Schools Minister. An amendment has been
tabled to the legislation so I have written today to you, Opposition
Members and to my hon Friend the Member for Keighley to say that
we have asked Sir Roger Singleton, the Chief Advisor on the Safety
of Children, to have an urgent look at whether the current legal
framework is sufficient and will report back on that very shortly.
It is important that we both look at the exact detail of the legal
situation as now, and for there not to be unintended consequences
that I think would arise if there were amendments that did not
quite get to the nub of the issue. The best thing to do is to
ask the independent adviser to give us a report. We will do that
shortly, but I would not want to come to the Committee having
written to you and not bring that to your attention.
Q55 Chairman: Secretary of
State, I hope you will know that my response to the media was
that, if there was an exemption, it should cease. I also said
that I had heard of no case of a child in that sort of setting
being ill treated.
Ed Balls: It is a complex, legal
area where we are right up against the divide between decisions
properly made by parents about the safety of their children, and
making sure that parents fully understand others' responsibilities.
The best thing to do is to get some advice from the expert and
set that out. We can then decide how to proceed.
Chairman: Thank you, Secretary of State.
I was on the original sub-committee of the Liaison Committee,
which produced the document "Shifting the Balance".
It is obvious that there is some shifting yet to do. Thank you
very much.
1 Note by witness: See Q2. Back
2
Note by witness: The Apprenticeships, Skills, Children
and Learning Public Bill Committee. Back
3
Note by witness: See Q25. Back
4
Note by witness: See Q6. Back
5
Note by witness: See Q46-48 Back
6
Note by witness: See Q25. Back
7
Note by witness: See Q25. Back
8
Note by witness: The letter referred to is from Jim Knight,
dated 10 March 2008. The Third Report of the Children, Schools
and Families Committee, Session 2007-08, Testing and Assessment,
HC 169-II, Ev 197, reproduces the relevant text. Back
9
Note by witness: See Q42. Back
10
Note by witness: See Q46. Back
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