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8.45 pm

Lord Davies of Oldham: I understand that the right to access is through the Cabinet Secretary as head of the Civil Service. That is the basis on which the National Statistician has operated and we do not seek to change that process. I reassure the noble Baroness that, whatever is contended as having been said

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elsewhere, we are sustaining the arrangements that have obtained for the National Statistician through the years for right of access to the Prime Minister through the Cabinet Secretary. That is how it works.

Lord Jenkin of Roding: I, too, have discussed the matter with the noble Lord, Lord Moser, and I do not believe that he ever had to go through the Cabinet Secretary. He had direct access to the Prime Minister. It is a pity that the noble Lord is not here to make that point to the Minister, but that was the position as he outlined it to me and to others who have met him and discussed these issues.

I do not think that the Minister is right in saying that access has always been through the Cabinet Secretary. It may have been since 2000, when the new framework was established; if so, that is a pity. However, we are looking to see the full practice reinstated with the right of direct access. One can understand that a strong Cabinet Secretary, approached by a Permanent Secretary when he knows what will be criticised directly to the Prime Minister, can make it extremely difficult for the National Statistician to see the Prime Minister, unless the National Statistician has the statutory right of direct access.

Lord Davies of Oldham: I hear what the noble Lord says. Of course it would have helped to have the benefit of a contribution from the noble Lord, Lord Moser, but I am reflecting what the present National Statistician enjoys. I am aware that the noble Lord, Lord Moser, goes a long way back in terms of his service to government and it may well be that he had a somewhat different arrangement. It certainly was not a statutory right, but that is what the amendment seeks to achieve. I was reflecting what I understood to be the National Statistician’s rights of access. It may well be that the noble Lord, Lord Moser—such is his reputation and the recognition of his significant role—enjoyed privileges that might not be vouchsafed to everyone. But we are discussing legislation here and I was faithfully reflecting the legislative position that governs the National Statistician.

Baroness Noakes: I am grateful to my noble friend Lord Jenkin for reflecting the conversations that he has had with the noble Lord, Lord Moser. They seem to be almost the same as the conversations that I have had with the noble Lord. He served three Prime Ministers, so there was not an isolated instance or a case of having a special relationship with one Prime Minister.

The noble Lord, Lord Moser, has been quite clear to me, to others and to the House about the value that he placed on direct access in order to get difficult things to happen, often involving other departments that were, for one reason or another, not observing best practice. The Minister will be aware that the most important influences are often those behind the scenes, and this was a way of ensuring that the National Statistician could operate through the Prime Minister behind the scenes.

The Minister’s response, which echoed that given in another place, is extremely disappointing and does not line up with the position that the noble Lord,

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Lord Moser, wants to see and which we support. However, I will not press the matter this evening. I hope that the Minister can go back and reflect on the matter with his colleagues, because, like the noble Lord, Lord Moser, we place a great deal of emphasis on it. On Report, I hope that we can make some more positive progress on the issue. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 24 [Ancillary powers]:

On Question, Whether Clause 24 shall stand part of the Bill?

The Earl of Northesk: The Minister will, I hope, be relieved to hear that my purpose in initiating a clause stand part debate is probing in character. As I implied with my earlier amendment, my motivation stems from my concern about the extent to which the Government envisage that the board should, or should not, become a conduit for the wider dissemination of raw data, rather than statistics, throughout Whitehall and conceivably beyond.

The Minister sought earlier to offer me some reassurance on the point by referring to Clause 44(9). However, I am not convinced that that provision affords me all that much comfort. Clause 24(1) states:

Its potential scope therefore, in so far as it is not confined to “statistical” function, is extremely wide. I acknowledge that up to a point it may be constrained by virtue of the reference to “ancillary” powers, but, by the same token, there is no indication in the Bill as to what these may be. Accordingly, it is mildly tempting to suppose that the clause offers an open invitation to function creep.

It may well be that I am being unnecessarily obtuse. Nevertheless, it would be helpful to know whether the Government’s intention is that the power granted is to be limited to “statistical” function alone or whether it is intended to go wider. If it is the latter, it would be helpful to know the sort of circumstances in which the Government envisage the power being exercised. Indeed, I should be grateful if he could provide some practical examples.

Lord Evans of Temple Guiting: As the noble Earl said, this is a probing Motion. The purpose of a clause of this nature is to give the board the necessary powers to transact its day-to-day business. It does not widen the scope of the board’s activities, nor does it provide any powers of compulsion. If it helps noble Lords, I will list some of the things that we expect the board may do under the power—enter agreements, acquire and dispose of property and promote or assist the promotion of publicity about the work of the board. These powers will also entitle the board to charge for certain services on a discretionary basis as ONS currently does; for example, for paper copies of its publications, for any statistical services it provides and for services promoting statistical research.

The inclusion of such a clause is fairly standard when creating independent statutory organisations such as a board. Such provision is included in, for

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example, the Utilities Act 2000, giving the offices of gas and electricity these powers. The clause in no way widens the scope of the board; it is there because it is necessary; and there is no interpretation of it other than it is a fairly standard clause that is found in many government Bills.

Baroness Noakes: Before my noble friend decides what to do with his Motion, will the Minister explain a little more about Clause 24(2)? It states:

Are there any restrictions on the board’s power under subsection (2)? For example, would it have to provide items in other languages—say, in Welsh? Could it get away with publishing everything on the internet? Are there any restrictions on this extremely wide power? I am puzzled by the breadth of the power.

Lord Evans of Temple Guiting: I shall say two things. First, I will go back to the point that this is a non-executive board composed of people with experience in other fields, who have a certain independence and who are not in the business of doing anything other than what the Government intend the board should do. Secondly, all the board’s functions are statistical; anything it does must be in line with that basic premise. There is little for the noble Baroness to worry about.

The Earl of Northesk: I thank the Minister for his reply. I am reasonably content.

Clause 24 agreed to.

Clause 25 [Reports]:

[Amendments Nos. 114 and 115 not moved.]

Lord Howard of Rising moved Amendment No. 116:

The noble Lord said: As it stands, Clause 25 ensures that the Statistics Board will report annually to Parliament and to the devolved administrations. The amendment seeks to add to what is included in that report. Clause 26 requires the board to act efficiently and not incur unnecessary costs or burdens, or impose them on others. This is an important clause. Its effectiveness will be considerably enhanced by making the board examine its own efficiency and cost-effectiveness, and include that appraisal in its annual report. The requirement to report on how burdens on others are being kept to a minimum will encourage the board to think twice before imposing unnecessary demands on other organisations and individuals. I beg to move.

Lord Davies of Oldham: Clause 26 obliges the board to have regard to efficiency and cost-effectiveness when deciding on the exercise of its functions, and to limit the costs that individuals, businesses and other organisations bear as a result of

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its activities; for example, when requiring them to fill in a survey. ONS has a long history of working to minimise the survey burden on respondents. It is right that this valuable work continues and that the board builds on this in assessing the burden that it places on others for the necessary supply of information.

I do not think that it is necessary to have an explicit requirement that the board should report on this one particular aspect of its functions. After all, the board has a wide range of functions and its job is to present a report to Parliament on how it fulfils its obligations. If it was clear that the board was failing in the respect to which the noble Lord draws attention, there is no doubt that that report would be subject to criticism.

We have got the board properly accountable for its work. It has a range of functions; it would be invidious to single out one function on which we laid legislative emphasis. I hope that the noble Lord will recognise that we also have precedent in how the ONS goes about its work. The board will inherit some working practices germane to its operations which have stood the statistical service in good stead.

Lord Howard of Rising: I thank the Minister. The board has not a function but a duty. There cannot be much wrong with asking the board to report on its efficiency at the same time as the many other things that it is obliged to report on. If the board does this at least how it is getting on, what it is doing and how it is managing its business will be able to be examined. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

9 pm

Baroness Noakes moved Amendment No. 117:

The noble Baroness said: I shall speak also to Amendment No. 169. Amendment No. 117 amends Clause 25 so that the board's annual report must include the work of the committee established under proposed new Clause 32(2A). Amendment No. 169 introduces new Clause 32(2A), requiring a committee to be set up to review the board’s internal financial controls and whether they secure the proper conduct of the board’s financial affairs. Proposed new subsection (2B) ensures that the committee comprises only non-executive members of the board.

In common parlance, the amendments require an audit committee. The drafting is based on that for the Pension Protection Fund set up under the Pensions Act 2004—a fairly recent precedent but there are others, such as the Bank of England Act 1998. It is now commonplace that organisations have an audit committee comprising non-executive members. The idea has been largely developed in the private sector, but is widely used in the public sector. There cannot be a rational argument for the Statistics Board not having an audit committee responsible for overseeing the internal financial control of the board.

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I hope that the Minister will not say that not all ministerial departments need audit committees or that they should exist on a statutory basis as an adjunct to the role of the accounting officer, because that calls into question why the non-ministerial government department model has been used if the laws of corporate structures, otherwise lauded in describing the structures of the Statistics Board, are to be bypassed. I beg to move.

Lord Evans of Temple Guiting: As we have heard, Amendment No. 169 would require the board to establish a committee consisting of non-executive members of the board, to keep under review whether the board’s internal financial controls secure the proper conduct of its financial affairs. Amendment No. 117 would ensure that the board’s annual report included a report of the work of the committee.

The Government believe that corporate governance is of fundamental importance. Good corporate governance includes embedding effective risk management at all levels of the management of government organisations, increasing the need for explicit assurance about risk, control and governance in organisations. As the noble Baroness knows, the work of audit committees is a key part of that.

To promote good practice across government, the Treasury publishes Corporate Governance in Central Government Departments: Code of Good Practice. The code contains as one of its basic principles that,

The corporate governance code also sets out that audit committees should be established by and function in accordance with the Audit Committee Handbook, another Treasury publication.

Clause 32 empowers the board to establish committees to exercise its functions, give it advice, and support it in transacting its business. However, rightly, it does not specify the names and functions of specific committees that must be established. The Government fully expect that the board will use that power to establish an independent and objective audit committee, chaired by an independent non-executive member, as set out in the code on corporate governance and following the guidance set out in the Audit Committee Handbook.

In addition, the Government expect Parliament to play the central role in holding the statistical system to account. There will be full accountability to Parliament as much for this aspect of the board’s work as for others. For example, in the extremely unlikely event that the board failed to establish an audit committee, I have no doubt that that would be a matter of fundamental concern to Parliament and it would call the board to account for that failure.

In those circumstances, we do not think it necessary to legislate for an audit committee. It is for the independent board to determine how it sets up its committees, including the details of their membership, and it is not

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appropriate to stipulate so much detail in the Bill. The board will be expected to follow best practice guidance, but it would not be appropriate to put that in legislation.

As I have said in previous debates, we do not think it necessary to stipulate the contents of the board’s annual report. Clause 25 already requires the board’s annual report to cover what it has done and what it has found each year, and within that remit, we think we should allow the board to use its own judgment, following good practice guidance, to ensure that the most pertinent information about its activities are reported each year. I hope my explanation is satisfactory to the noble Baroness.

Baroness Noakes: I thank the Minister for that comprehensive response. However, he has not explained why in some Bills the Government write audit committees into the government structure and not in others. Does he know the reason for that?

Lord Evans of Temple Guiting: I do not know the answer. I shall write to the noble Baroness. I agree with her that it is inconceivable that the board should not have an audit committee. I ask her not to be overly concerned about this point.

Baroness Noakes: I am concerned about many points in this Bill and I shall seek assurances on many aspects. I am grateful for the Minister's comprehensive reply, which I shall consider carefully alongside his last comment. I am mystified why some Ministers, including Treasury Ministers, stand at the Dispatch Box saying, “We have to legislate for this”, and on other occasions they say, “Of course, we have to let the board do it”. The Minister might accept that that is inconsistent government. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Howard of Rising moved Amendment No. 118:

The noble Lord said: I shall speak also to Amendment No. 119. The Bill as drafted does not require the annual report to be laid before both Houses of Parliament. The amendment ensures that that will happen, giving both Houses the opportunity to debate and to scrutinise the work of the Statistics Board. It would be unwise to disregard the enormous experience and knowledge of this House when scrutinising the annual report. I cannot believe that that is the intention of the Government. I hope that the Minister will accept the amendment. I beg to move.

Lord Evans of Temple Guiting: These amendments relate to the board's duties to prepare reports. The reports under Clause 25 are reports primarily to Parliament and, where relevant, the devolved legislatures, although of course the reports published under this clause will also be published and made widely available. The reports are particularly important given Parliament’s central accountability role, and should be one of the main mechanisms by which Parliament might hold the statistical system to account.

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The annual report under Clause 25 should include the board’s forward work plans, including that of the executive office of the National Statistician and—as with the annual reports produced by all departments—the board’s audited annual accounts. Although we strongly hope that Parliament will play an active scrutiny role throughout the year, and not just once a year at the point of the publication of the board’s annual report, the annual reporting system will help Parliament to assess whether the board is effectively and efficiently discharging its duties.

Reports under Clause 25 will allow the board to inform Parliament about: the advice and guidance it has provided to others, including Ministers of the Crown and Ministers in the devolved Administrations, under other duties and powers it has in the Bill; the response it has received from those to whom it has provided that advice; and its views on the adequacy of the response where appropriate.

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