Managing Budgeting in Government - Public Accounts Committee Contents

3  Challenge, scrutiny and learning

14.  In total, 44 of the 52 staff that worked in the Treasury's spending teams for the five case study departments examined by the National Audit Office had left within 20 months of the Spending Review. We were particularly concerned that only one member of the thirteen-strong Department for Energy and Climate Change spending team for SR10 was still in place meaning that the Treasury is in a weaker position to support or challenge the department than it should be. The Treasury conceded that its staff turnover is "too high" although it did add that turnover was coming down. The Treasury explained that one of the reasons that so many spending team staff had moved on since SR10 was due to the fact that it had deliberately kept on experienced staff for the Spending Review who inevitably left once the work was complete.[18]

15.  Of equal importance is the need to ensure the right staff are recruited and retained. We have previously expressed concern about the lack of commercial and contracting skills in departments and the failure to learn lessons from problems with the Private Finance Initiative. In response the Treasury agreed that it was important to have permanent staff members who have a good understanding of contracting rather than being reliant on consultants. It also conceded that it needed to be better at learning lessons from past experience rather than only focussing on things once they have gone seriously wrong. The Head of the Civil Service explained that it would always be a challenge to have enough highly paid experts to deal with all the contracts that the government has, and therefore it was incumbent on all civil servants to become more commercially aware.[19]

16.  There is currently very little external scrutiny of the budgetary process. The National Audit Office report noted that legislative oversight of spending plans is not highly rated and highlighted OECD research which showed that legislatures in countries such as the USA, Germany, Switzerland and New Zealand have greater powers to amend budgets and longer to review them than the UK Parliament. In Scotland, budgets are published first in draft to enable public scrutiny and challenge, and in June 2011 the Scottish Finance Committee appointed a specialist budget adviser to scrutinise proposals. [20]

17.  The Committee asked the Treasury if departmental select committees would be able to look at spending proposals to provide external challenge and accountability. The Treasury said that it would encourage such a move but noted that departmental select committees had generally not shown much interest in this area. It also noted that select committees had been consulted on PSAs (Public Service Agreements) in the past.[21]

18   Qq 42 - 44 Back

19   Q 46 - 48, 51 Back

20   C&AG's Report, para 2.30-2.32 Back

21   Q 49 - 50 Back

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Prepared 8 March 2013