Select Committee on European Union Minutes of Evidence

Examination of Witnesses (Questions 40-59)

Meg Munn MP and Ms Liz Chennells

24 NOVEMBER 2005

  Q40  Lord Trefgarne: So EOC were consulted by the Commission as well?

  Ms Chennells: Yes.

  Lord Trefgarne: That did not appear to be so from the witness we had last week.

  Q41  Chairman: As you say, he is, as it were, the junior partner on this; he might not be quite so aware of what had been happening at an earlier period.

  Ms Chennells: Amanda Harris, who was due to give evidence, has worked for the Commission since the original research. I do not think Mr Broeke was in the Commission at that stage.

  Chairman: That might be just a misunderstanding; we can certainly look at both sets of evidence and see what we feel about it.

  Q42  Lord Colwyn: Could we talk a little bit now about budget and costs. In your letter of 12 October you said that the European Parliament has made strong calls to increase the budget of the Institute and enhance its role and scope to make it a more political instrument. Then you say the Council's position on the Institute is modest compared with the approach taken by the European Parliament. I wonder if you could explain what you think "budget neutral" is. Budget neutral to me sounds wonderful, like it does not cost anything at all, but I am sure that cannot be right. Do you have any idea what a reasonable budget might be and tell me what budget neutral means? I have looked through all the papers and I cannot find an explanation of it.

  Meg Munn: If I can deal with the budget neutral bit and then I will find the bit in my papers where there are some proposed costings on it so we can talk about that. In terms of budget neutral, what that means is that the money for the Institute has to come from somewhere else. Nobody is adding any more money into this whole area. It really goes back to what I was talking about before in that the budget is spent on various projects developing issues of gender mainstreaming across the European Union. What I am concerned about is that if we are spending that money then we actually need to be getting the value from it in terms of the learning and being able to disseminate that. In terms of how that would work, it means that some of the money which would otherwise be going into programmes would be used in order to gain the learning from the actual proposal.

  Q43  Lord Colwyn: Are you saying that this is money that already exists, it is not new money?

  Meg Munn: Yes. It is not a zero budget. No impact on the existing budget I think is the best way of describing the term budget neutral.

  Q44  Baroness Howarth of Breckland: Does that mean that there will be some local projects that are developing these issues where there will be cuts in their budget in order to fund the Institute? I think we need to understand how that money is going to be allocated.

  Meg Munn: It is not existing projects; it is in terms of how money would be spent in the future from the relevant European Union programme. It is going forward into the future and instead of all of it going out to projects it is being used to analyse and collect data in order to share the good practice.

  Q45  Lord Harrison: Clearly it is not budget neutral in the sense that you have an entity which generates its own income and that matches its expenditure. In that sense, surely this is misleading because, as we understood it from the EOC, what is happening is that there is a budget line from which is subtracted the amount which will fund the Institute. I am personally in favour of it, but I do think you should say to your colleagues that budget neutral has certainly misled members of this Committee.

  Meg Munn: I understand where the confusion has arisen and I am always asking for greater explanations rather than shorthand on various things because I think it can often be misleading. I suppose it is the shorthand that people used to say that nobody is going to have to put any more money into it but actually there are implications in how existing money is being spent.

  Q46  Lord Harrison: Money will then be subtracted from the budget line which might have funded other very worthwhile enterprises.

  Meg Munn: Certainly, and I think this comes really to the fundamental issue which I have been concerned about and I think is one of the concerns of the Committee, what is the Institute going to do which is going to add value? I think where it adds value is that, yes, there will be less money going to projects but getting more value out of the money that is being spent on projects. Perhaps if we can just talk a bit about the budget because obviously the actual amount in terms of that is one of the things which I am concerned about and I am sure you are. Discussions about the possible budget are ongoing and at the moment, as you will be aware, the overall budgetary matters are part of the negotiations being led by the Treasury. Again, just to clarify the point, our concern has been that this Institute should not lead to any spending increase. The Commission agrees with that, as does the Council, so in terms of the proposed costs the annual budget for 2007 is envisaged to be

6.5 million rising to

8.5 million by 2013 once the Institute has reached its full complement of 30 staff. So it is building up over a period and obviously the budget, as I am sure you will be aware, will be agreed by the Council and the European Parliament on an annual basis.

  Q47  Lord Colwyn: So there is no danger that it is going to be left under-funded and unable to achieve its design purpose?

  Meg Munn: There is always going to be a debate about funding and how much money should go into various institutes. We have had a lively debate on the floor of the House of Commons about a new Commission for Equality and Human Rights, as to whether that was too much or too little. In terms of will this be able to do what it is setting out to do, I think this is sufficient to do that. What we are talking about is gaining the learning and experience from what is happening both in terms of European funded money and also other national projects that are going on on gender equality and it is not meant to be a huge bureaucratic organisation which is not really adding value and putting the information out there. I think that should be sufficient.

  Q48  Chairman: Nevertheless, there is what is called an opportunity cost in the sense that if you have a budget which is X out of which Y has to be taken, then all the other things which are not Y are either going to be reduced or diminished in number or whatever it is. That is where the "cost" comes really.

  Meg Munn: Of course, yes.

  Q49  Lord Trefgarne: Is it going to have a building to live in?

  Meg Munn: I think the people would need to be somewhere, so yes.

  Ms Chennells: It will be based somewhere. Probably not a building, a suite of offices somewhere.

  Q50  Lord Colwyn: That is the set up budget. Is the budget extrapolated further in the next five years or so?

  Meg Munn: Yes, we have proposed costs. Would it be easier if we wrote to you with these rather than me sitting here reading out the figures and possibly getting them wrong?

  Q51  Chairman: I think that would be very useful.

  Meg Munn: We will set out what the proposed costs are split down into proposed staff members, administration and operations.

  Q52  Baroness Howarth of Breckland: I am interested in the management structure and the governance of this organisation. You said a little while ago that proper discussion with the various Member States about this issue was one of the values of the Institute. I just wondered if that was why the membership was increased to 25, which makes it feel like representation rather than a management board. Could you describe a bit more how you see this being properly managed? Would that unwieldy body undermine the responsibility of the director?

  Meg Munn: Essentially, the composition of management was the point of much discussion in the Council and Member States who were looking thoroughly at all the options and the Council felt that because it was one of the main objectives of the Institute to share good practice it would be more effective if all Member States were able to be present. Given that Member States have made different progress in the field of equality and have different perspectives to share it was felt that allowing everybody to be present at that level was important. It does also follow a precedent for other European Union agencies. The actual details about that have not been finalised. They are talking about the management board meeting at least once a year and then further meetings being convened if necessary, but I think it is the kind of detail they do need to work out. It is one of those situations where I think rightly, and encouragingly, all Member States want to be involved and get that level of information. I think there would have to be a difference between the day to day running and the management of the organisation as opposed to both the oversight which Member States rightly want to have but also the learning and the taking back and the raising of issues which are perhaps particularly pertinent in particular countries. That does need to be discussed.

  Q53  Lord Trefgarne: Will there be anyone in charge?

  Meg Munn: Yes.

  Q54  Baroness Howarth of Breckland: Can I just pursue that? I do chair an international body with exactly these difficulties and I understand what you are trying to achieve. Is the executive board really the group that is managing? I wondered why, therefore, you had not got this wider board as the advisory group which you have abandoned? Was that the right way to go and what kind of consultation went on around that? Certainly we had some discussion about that with the EOC.

  Meg Munn: I think, again, the issue is that it is always a compromise between trying to involve everybody and not having too many different meetings which look at similar issues, because obviously those in themselves take up resources and actually consume time. Liz, do you have the details of the consultation process that led to that decision?

  Ms Chennells: It was negotiation rather than consultation. It became very clear in the negotiations that the only way the UK was going to explore effectively the issue of whether a management board could not represent all Member States was by kind of taking the first step itself and saying, "We would be happy not to be represented" and "We are not happy not to be represented" which made it very easy to understand other Member States' positions because every Member State does take this issue very seriously and I think that is to be welcomed. I think what it envisages is this management board—again that might be a slight misnomer but that is always a difficulty working in different languages—should take a very strategic approach whereas, you are right, the executive board would have more regular contact with the director and his or her top team in terms of monitoring the budget more closely. The management board would be setting the direction for the work programme for the new body and then hearing about how that work programme has been carried forward on an annual cycle.

  Q55  Baroness Howarth of Breckland: Could you just describe the decision making process? You have this Institute set up. You have a strategic plan which presumably has been decided by what you call the management board (which I think is very misleading for people who are going to be on it), but how do the decisions carry through that organisation? Who feels accountable for what?

  Ms Chennells: I think the director will feel accountable for the delivery of the agreed results within the agreed resource envelope. That will be a critical appointment. The executive board will also have some responsibility for the success or failure of the organisation as well. The director will be hands on day-to-day; the executive board might meet quarterly or something like that; the management board will be entitled to expect and will congratulate or reprimand as appropriate but will not be able to make micro adjustments. It will be setting the direction and the micro adjustments will have to be done by the director in consultation with the executive board.

  Q56  Chairman: Is the executive board the body which, as it were, makes sure that the budget is correctly formed and that the expenditure is being properly carried out with the budget? Or is that the director's job?

  Meg Munn: The director will have to report to the executive board.

  Q57  Chairman: That is exactly what I am getting at. The executive board will be the body that deals with the broad brush, something more like that.

  Meg Munn: Yes.

  Q58  Lord Harrison: I am always worried when a group of words are spatchcocked together, as in the case of "Specific, Measurable, Achievable, Relevant and Timed" to form a word such as SMART. I have lived in the world of acronyms in Brussels so I am familiar with it, but if these targets exist how are we going to go about actually understanding and ensuring that they are indeed achieved? I wonder, in reply, whether you might give the Committee some tangible examples. I refer back to Ms Chennells' interest in the Goods and Services Directive which preceded this Institute. How might we have measured the success of any collaboration within the Gender Equality Institute such that we could then be satisfied with what you said, which is that true value was added by having a European dimension to these matters?

  Meg Munn: I am not sure who came up with SMART first but I remember I first came across it when I was doing management studies or something, so I do not think it is a European thing; I think it comes from somewhere else. Anyway, I think the clear issue in relation to anything where we are setting targets is that what you achieve are sometimes as good as the targets you set in the sense that you have to be clear about the outcome of the work you are doing and what is it that you are trying to get within the resource and time constraint. I think the most successful projects achieve that when even before they are set up how they are going to be measured and evaluated is part of it and that is something which is now much, much more the case in terms of domestic projects. Through that you would report through the management chain to the executive board and obviously on an annual basis to the management board as we have just been discussing.

  Q59  Lord Harrison: How might that have been measured? What are the elements that you would have sought to find out to satisfy yourself that this was worthwhile?

  Ms Chennells: The Goods and Services Directive?

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