1 The conduct of OBR appointment hearings
1. The Chancellor wrote to the Chairman on 8 September
2010 that his preferred candidate to be Chair of the OBR was Robert
Chote, but invited the Committee to conduct a pre-appointment
hearing, saying that he would not appoint a candidate who was
judged unsuitable by the Treasury Committee.[1]
We took evidence from Mr Chote on 16 September. This will be published
shortly, together with Mr Chote's answers to our questionnaire
and his curriculum vitae.
Professional competence and personal
independence
2. This Report is concerned solely with whether we
consider the Chancellor's preferred candidate to be suitable as
Chair of the Office for Budget Responsibility. Our report on the
structure of the future OBR will be published very shortly.
3. The practice of select committees holding appointment
hearings was initiated by the previous Treasury Committee following
the creation of the Monetary Policy Committee (MPC) in 1997.
4. In 2007 the Governance of Britain Green
Paper proposed pre-appointment hearings by select committees for
a range of government appointments.[2]
Following correspondence between the then Liaison Committee and
the Government, a list of posts subject to pre-appointment hearings
was agreed along with guidelines governing how they operate.[3]
Pre-appointment hearings operating under these guidelines are
advisory: the Committee's findings are not binding on the Government.
Pre-appointment hearings under these guidelines assess candidates
on the basis of personal independence and professional competence—the
same criteria that we use to asses MPC appointees.
5. As the Chancellor said in the letter to our Chairman
announcing his preferred candidate, the OBR was created "to
make independent assessments of public finances and the economy,
the public sector balance sheet and fiscal sustainability."
The OBR Chair needs both the professional competence to make those
assessments, and the personal credibility to ensure that they
are seen as independent.
6. We consider
that personal independence and professional competence are the
criteria we should use in assessing the suitability of the proposed
Chair of the OBR. Personal independence is particularly important
in this post. The close association between the Government's budget
and the work done by the OBR means that the integrity and independence
of the Chair must be beyond question if the OBR is to fulfil its
purpose of increasing confidence in the statistics produced by
government, and the economic analyses underlying policy decisions.
The Committee's veto
7. The Chancellor of the Exchequer announced the
creation of the Office for Budget Responsibility (OBR) on 17 May
2010. Appearing before this Committee on 15 July the Chancellor
said:
What I would propose to do, of course subject to
your approval, is to give this Select Committee a veto on the
person nominated by the Chancellor of the day. I think this will
be the first time that any select committee has ever had a veto
on an appointment. Obviously it is entirely up to you whether
you will want to take up that offer, and if you deem it appropriate
it will be put in the statute which I propose to present to Parliament
later this autumn because I want there to be absolutely no doubt
that this is an independent body, that this person has the support
and approval of the Treasury Select Committee in undertaking that
work, that they come here to give evidence.[4]
The ability to veto the Chancellor's nomination to
the Chair of the OBR is a major increase in our powers, and we
welcome it. We
consider it particularly important that the Chair of the OBR should
have the approval of the Committee. Involving this Committee in
the appointment process is a significant step in ensuring that
the preferred candidate is indeed independent.
1 http://www.hm-treasury.gov.uk/press_43_10.htm Back
2
The Governance of Britain, Cm 7170, July 2007 Back
3
Liaison Committee, First Report of Session 2007-08, Pre-appointment
hearings by select committees, HC 384 Back
4
Treasury Committee, First Report of Session 2010-11, June 2010
Budget, HC 350, Q 213 Back
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