APPENDIX
Memorandum by the Clerk
of the Parliaments
1. At its meeting on 13 November the Committee
discussed the future funding arrangements for the four Parliamentary
Groups—the British-American Group ("BAPG"), the
British Group of the Inter-Parliamentary Union ("IPU"),
the British Irish Inter-Parliamentary Body ("BIIPB")
and the UK Branch of the Commonwealth Parliamentary Association
("CPA"). The Groups are currently funded by grants-in-aid
from the Treasury amounting to £3.3 million in 2007/08, but
the Treasury wishes to transfer responsibility for funding to
the House of Commons Commission and the House of Lords.
2. The House Committee agreed in principle to
provide 30% of the funding for the four Groups, subject to certain
conditions and to request further information from the Groups
about the relative levels of participation of members of both
Houses (which is set out in the Annex). The Committee expressed
a wish for proper budgetary and governance controls over the Groups,
and did not want support from the two Houses to become a precedent
for other groups to seek funding in this way.
Background
3. I remind the Committee that the governance
of each Group is the responsibility of its own Executive Committee
elected by its Members from both Houses. The formal status of
three (other than the BIIPG) is a Parliamentary Group and the
larger two are charities. Their accounts are audited, they produce
annual reports and their officers are elected from among MPs and
peers each year. The larger two employ several staff and make
provision for their pensions. The funding arrangement with the
Treasury is the subject of a detailed Financial Memorandum in
each case.
Breakdown of Budgets
4. The Groups have now provided a breakdown of
their budgets between various activities. For both the IPU and
the CPA (whose budgets and activities are much greater than the
other two bodies), budgets are divided between general administration,
overseas travel, hosting inward delegations to the UK and subscriptions
to their international parent bodies as follows:
| CPA 2007-08 |
£ | | IPU 2007-08
| £ |
| | |
| |
| Administration | 638,500 |
| Administration | 474,695
|
Contingencies |
77,587
| |
IPU official activities overseas
|
163,777 |
| | |
| |
| Travel | 380,500 |
| BGIPU bilateral activities overseas | 247,200
|
| | |
| |
| Election Observing | 20,500 |
| Visits programmes in UK | 267,500
|
| | |
| |
| UK Conferences | 568,125 |
| Support to affiliated APPCGs |
61,800 |
| | |
| |
| Training | 14,000 |
| IPU membership | 263,539 |
| | |
| |
| CPA Branch Subscription | 165,000
| | | |
5. The staff involved would continue to be employed as at
present and none would transfer to the House of Lords or Commons
service. The nature of the groups' activities also involves hosting
conferences in the UK from time to time at additional cost. For
example, the UK Branch of the CPA will host the centenary annual
conference in 2011 at an estimated cost of £1.7 million.
Decisions taken by the Commons Commission
6. At its meeting on 17 December the House of Commons Commission
agreed that funding of the four Groups should be transferred to
the Commons and that grants-in-aid should be made to the Groups
with effect from the start of the 2008-09 financial year on the
following terms:
| a) | Any future liability arising from events before 31 March 2008 should remain the responsibility of the Treasury.
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| |
b)
| The House of Commons will fund up to 70% of the total costs of each group.
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| c) | A financial memorandum will be drawn up with each of the groups on similar terms to the existing memoranda with the Treasury.
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d)
| In order to ensure proper financial control following the handover from the Treasury, any annual increase in grants will be no more than RPI (with the exception of separately-authorised additional expenditure in relation to hosting inter-parliamentary conferences). The Commons' Finance and Services Committee will each year examine the proposed grants-in-aid for the following year.
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e)
| The Commission will appoint to the Executive Committee of each group a senior official of the House to represent the House's interests.
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7. For their part the four Groups have accepted that:
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- If in future the House decides to make overall reductions in spending, the same reductions shall apply to their grants-in-aid.
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- The use to which grants-in aid are put shall be subject to audit or value for money studies reporting to the appropriate Commons Committee.
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- There will be no change in the status of the staff of the groups and the Commission will not assume any additional responsibility for the staff of the groups.
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8. In addition, the House of Commons and the four Groups have
agreed that in due course the Commons' rules relating to the participation
of Members in international activities funded by the House (which
are applied by extension to House of Lords Members) should also
be applied to the activities of the Groups. These rules are designed
to ensure that expenditure is only incurred for proper purposes
and that the reputation of the House is protected.
9. I believe that these terms go a considerable way to meet
the Committee's concerns about budgetary control and I invite
the Committee to agree that funding by the House of Lords should
be subject to similar terms. Officials in the two Houses have
agreed to work closely together, not least in their representative
capacity on the Executive Committees.
10. In connection with the Committee's concern that other
parliamentary groups akin to the BAPG might seek funding from
the two Houses, the Commons have drawn attention to a documented
refusal by the Government to fund a further parliamentary group
on the grounds that the initial funding of the BAPG in the 1940s
was always intended to be unique. This may provide some assurance
on this point.
Cost Implications
11. If the Committee agree that 30% of the funding of the
Groups should be transferred from the Treasury to the House of
Lords, the additional expenditure for the House is likely to be
some £1.1m, based on 2007-2008 expenditure.
12. As with the History of Parliament Trust, funding for these
groups from the parliamentary estimates would be reviewed each
year, with the groups reporting to the Commission and the House
Committee on their work and their budgets being scrutinised by
the Commons Department of Finance and Administration and the Lords
Finance Director respectively. The rigour of such scrutiny would
be no less demanding than that of the Treasury.
13. If the Committee agrees to make grants-in-aid to the four
bodies, the model to follow would be that of the History of Parliament
Trust. The chairman and director appear once a year to explain
the annual report to the House of Commons Commission, and the
House Committee might wish to adopt a similar procedure in respect
of the History of Parliament Trust and the four Parliamentary
Groups
House of Lords Participation
14. The figures supplied by the Parliamentary Groups (see
annex) demonstrate that recent participation of Lords members
has been somewhat less than 30% in overall terms. Given the increased
activity levels of members of the House of Lords generally, and
members' interest in the groups, the Committee may agree that
it would be desirable for participation levels in delegations
by members of the House of Lords to be as near as possible to
30% in future. In addition, Mr Speaker has for some years formally
approved delegations of Members of the Groups and the Committee
is invited to consider whether a similar arrangement should be
sought for the Lord Speaker.
15. I also propose that the Committee agrees to a 30% share
of funding on condition that the proportion of members of the
House of Lords on the Executive Committee of each of the Groups
should, so far as possible, reflect the Lords share of the funding.
16. Thirdly, I propose that the House Committee appoints to
the Executive Committee of each group a senior official of this
House to represent its interests.
Recommendation
17. I invite the Committee to agree:
a)
| That 30% of the funding of the four international Parliamentary Groups should be transferred from the Treasury to the House of Lords and that grants-in-aid should be made to the Groups with effect from the start of the 2008-09 financial year.
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b)
| That any future liability arising from events before 31 March 2008 should remain the responsibility of the Treasury.
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c)
| That a financial memorandum should be drawn up with each of the Groups on similar terms to the existing memoranda with the Treasury.
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d)
| That, if in future the House decides to make overall reductions in spending, the same reductions should apply to the Groups' grants-in-aid and (with the exception of separately authorised additional expenditure in relation to hosting of inter-parliamentary conferences) any annual increase in grants should be no more than RPI.
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e)
| That the use to which grants-in aid are put shall be subject to audit or value for money studies reporting to the Audit Committee.
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f)
| That in order to protect the reputation of the House, the House shall at some future stage, apply to the grants-in-aid rules similar to those which apply to select committee and delegation travel.
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g)
| That there should be no change in the status of the staff of the Groups and the Commission will not assume any additional responsibilities for the staff of the Groups.
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h)
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That the House Committee shall appoint to the Executive Committee of each Group a senior official of the House to represent the House's interests.
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i)
j)
| That, as proposed in paragraphs 14 to 16 above, the participation of members of the House of Lords in the activities of the Groups and their executive committees, should be as near as possible to 30%.
That an arrangement should be sought for the Lord Speaker to have a role in formally approving delegations, as Mr Speaker already does.
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January 2008
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