50. Letter to the Commissioner from
the Director of Strategic Projects, Department of Resources, 24
August 2010
Thank you for your letter of 12th August and for
showing me an extract from the evidence which you have received
from [name], the then Head of the Fees Office, whom Mr Mackay
has said that he met in September 1997 to discuss matters relating
to the identification of his main and second homes.
Perhaps I can first correct some of the references
[the former Head of the Fees Office] makes. It is understandable
that his recollection of events is blurred by the passage of time
since he left the House's service in 1998, and, of course, he
has no direct knowledge of events after that time.
To deal with the points in order:
- The position of Director of
Strategic Projects was created as a personal appointment in 2007.
I believe that [the former Head of the Fees Office] may be confusing
this post with that of Director of Operations, as held by [name]
from his appointment in 2004 until he left the House earlier this
year
- The Department of Resources was created in January
2008 after Sir Kevin Tebbit's Report on the House service. It
replaced the Department of Finance and Administration
- The then Department of Finance and Administration
moved from Dean's Yard to 7 Millbank in September 2001
- The passage of the Freedom of Information Act
2000 was the stimulus to many public bodies to adopt a more considered
and rigorous policy on the retention of records. This was implemented
in the House. Old records were sorted into those which had a current
utility, those which should be archived and those which could
be destroyed. There was no wholesale disposal of Members' personal
files, though it is possible that documents were not retained
which ought to have been. This may explain the absence of any
record of a conversation between Mr Mackay and [the former Head
of the Fees Office]
- No policy of "absence
of prior audit" was introduced by
the current Director General of Resources, though as part of wider
development work consideration was given at one stage to the option
of replicating in respect of allowances the Inland Revenue approach
of post-event checking of taxation liabilities. Such a policy
was never implemented.
I turn to your specific questions. In your letter
to me, you say that [the former Head of the Fees Office] said
that "he does not know whether anybody in the office would
necessarily know that Mr Mackay and Ms Kirkbride were married."
In fact, he said that he did not know "whether anybody
in the office responsible for "payments" would necessarily
know that Mr Mackay and Ms Kirkbride" were married. This
is an important difference. The junior officials responsible for
paying allowances may indeed not have known about such matters,
but the framework within which allowances were authorised was
set by more senior officials who would have known when Members
were married to one another.
From the extract which you have sent me, I am not
clear whether [the former Head of the Fees Office] contests Mr
Mackay's recollection of their September 1997 discussion. But
even if no such discussion had taken place, it should have been
incumbent upon senior managers in the then Fees Office to look
at unusual circumstances such as those of two Members married
to one another so as to ensure that they were properly advised
and that the purpose of ACA was being properly followed.
I note that Sir Paul Kennedy accepted (in relation
to Ms Kirkbride) "of
course that the Fees Office did know what was going on because
it authorised payments in respect of your claims".
I respectfully agree with Sir Paul's view.
You refer to Mr Mackay's evidence in his letter of
21st January 2010, that he did not inform the Fees Office that
he was sharing a property with another Member who was his wife.
I have not seen the question to which Mr Mackay was here responding.
However, I inferred that it was a question asking him whether
he had made a formal notification when the request to do so first
appeared in the Green Book of 2003. Despite him not having done
so, the clear implication to me of the early part of his letter
of 21st January is that he openly discussed his and Ms Kirkbride's
living arrangements with [the then Head of the Fees Office].
In sum, [the former Head of the Fees Office's] evidence
does not cause me to change my original conclusions that it was
reasonable for Mr Mackay to have inferred that the Department
had no difficulty with the arrangements.
Finally you ask for a response to [the then Head
of the Fees Office's] suggestion about a Compliance Section check.
I assume that [he] is referring to a section in the Department
established in 2005 and known as the Quality Assurance Team. During
2007 and 2008 this team was tasked to examine the claims of about
a fifth of Members randomly chosen each year. Neither Mr Mackay
nor Ms Kirkbride was among the Members checked during those years.
The systematic examinations ceased in 2009.
I now turn to the letter [from your office] of 20th
August.
It became a requirement for Members to indicate their
second homes on each relevant claim form after the publication
of the 2003 Green Book. In 1997, Members were simply required
to provide details of their main home on a nomination form that
was completed when they were first elected. Documentation was
not required to support ACA claims and so, as a general rule,
the Fees Office had no knowledge of the location/address of Members'
second homes.
However, if Members were concerned about their arrangements,
they could and did discuss the issues which concerned them with
senior managers in the Fees Office. Notes of conversations, together
with other background notes, were normally kept in a general file
(there was one for each Member). These files were not referred
to at a day-to-day operational level, though operational staff
would have been instructed not to make any payments which were
regarded as in principle irregular.
Please let me know if I can help further.
24 August 2010
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