2 The cost of setting up the Commission
9. The Commission spent £38.8 million on
setting itself up and winding down the Legacy Commissions in the
period covered by its 2006-08 accounts (Figure 2). This
includes the cost of the early exit scheme of £11.1 million,
and the transition team's salaries, which cost £8.7 million.[28]
The transition team had 83 members of staff who were employed
for varying amounts of time over a period of 18 months. The members
of the transition team therefore received an average of over £100,000
each.[29] The cost of
the early exit scheme crystallised when the Legacy Commissions
closed. The Commission's best estimate is that around 70% of the
other set-up costs were also incurred after the Commission was
launched; this indicates the extent to which the Commission was
not ready for business on 1 October 2007.[30]Figure
2: Set-up costs reported in the Commission's 2006-08 accounts
(in £ million)
Source: Ev 25, Annex B
10. A further £9.3 million was spent by
the Commission on purchasing new equipment, such as computer terminals,
even though it inherited equipment from the Legacy Commissions.
The Commission wrote off assets inherited from the Legacy Commissions
at a cost of £1.4 million. The Commission could not explain
why it chose not to use the equipment it inherited from the Legacy
Commissions.[31]
11. The cost of reconfiguring the Commission's
estate has also been high. Each of the Legacy Commissions had
a head office in London, as well as offices in Scotland and Wales.
The Commission decided that 14 of these leased properties were
not suitable for the new Commission.[32]
In particular, it considered that the old London head office buildings
were too small to house the 160 staff the Commission wanted to
base in London, and that some of the buildings did not meet accessibility
standards.[33] Disposing
of these leases cost the Commission £2.7 million during the
2006-08 period, and the Commission is still trying to dispose
of a long term lease for one London property.[34]
The Commission is continuing to review the properties it occupies,
and intends to rationalise its holdings to reduce costs.[35]
The Department confirmed that the Commission will be expected
to transfer more staff to its Manchester offices when the lease
on its current headquarters building expires in 2013.[36]
12. This Committee and its predecessors have
previously taken evidence on the creation of public bodies, most
recently in the case of the creation of HM Revenue and Customs
Prosecution Office.[37]
We are disappointed to see that the same mistakes continue to
be made and at a significant cost to the tax payer.[38]
28 Qq 92-93; Ev 25, Annex B Back
29
Q 69 Back
30
Ev 32-33 Back
31
Qq 112-114 Back
32
Q 118 Back
33
Qq 115, 123 and 124 Back
34
Qq 116 and 120 Back
35
Q 125 Back
36
Qq 122, 126 and 128 Back
37
Qq 136 and 137; Committee of Public Accounts, Fifty-first Report
of Session 2007-08, Revenue and Customs Prosecutions Office,
HC 601, para 4-5 Back
38
Qq 92 and 137 Back
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