Appointment of the Chair of the National Audit Office
(Limited Text - Ministerial Extracts only)
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The Prime Minister (Mr David Cameron)
I beg to move,
That an humble Address be presented to Her Majesty, praying that Her Majesty will appoint Professor Sir Andrew Likierman to the Office of Chair of the National Audit Office.
This is the first time that a Prime Minister has moved a motion to appoint the chair of the National Audit Office, and it is a direct result of the legislation that we have brought forward to implement the Public Accounts Commission’s recommendations on strengthening the governance of the National Audit Office, including through new board arrangements and an independent chair.
At a time when we are getting to grips with a record budget deficit, and when families and businesses up and down the country are working hard to make ends meet, it is more important than ever that we get the best possible value for money in public service delivery. That is why, for example, this Government have delivered £3.7 billion of savings in just 10 months—enough to pay the salaries of 200,000 junior nurses or 150,000 secondary school teachers.
The National Audit Office has a vital role to play in holding the Government to account and in ensuring that we achieve the greatest possible value for money. The proposed chair is Professor Sir Andrew Likierman, currently the NAO’s acting chairman. He was appointed following an open competition by my predecessor the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) and the former Chair of the Committee of Public Accounts, my hon. Friend the Member for Gainsborough (Mr Leigh). The intention was that Professor Likierman should become the chair of the new NAO in due course, and he has indicated his willingness to continue in the role for a further three years.
Professor Likierman is a distinguished public servant with extensive knowledge and experience of business and public service. Since taking up the acting chair role, he has established the NAO’s board as an effective governance body, providing support and independent challenge to the NAO’s decision-making process. He has also provided counsel and advice to the Comptroller and Auditor General at a time of change for both the NAO and the central Government bodies that it audits.
I believe it is desirable for Professor Likierman to be appointed under the new legislation in order to provide continuity as the NAO formally adopts its new governance arrangements, and I have no hesitation in commending this motion to the House.
The Economic Secretary to the Treasury (Miss Chloe Smith)
It is an honour to support the Prime Minister and the right hon. Member for Barking (Margaret Hodge) on the motion to appoint Professor Sir Andrew Likierman as chair of the new National Audit Office. I should like to echo the tributes of other Members, including my hon. Friends the Members for Gainsborough (Mr Leigh) and for South Norfolk (Mr Bacon), regarding the fine contribution that Professor Likierman has already made as shadow chairman of the National Audit Office and his qualifications for the role.
Since becoming shadow chairman, Sir Andrew has done tremendous work to establish the shadow board as an effective and authoritative governance body. This has set the basis for the future as the NAO takes on its full responsibilities. As the House is aware, the new governance arrangements for the NAO were enacted following a report by the Public Accounts Commission in the previous Parliament. That report recommended that the NAO, led by the Comptroller and Auditor General, should remain the Government’s auditor, independent of Government and answerable directly to Parliament through the commission. The commission also recommended that the NAO should be a corporate body, with existence separate from, but providing resources and support to, the Comptroller and Auditor General.
The new NAO will have a board with a majority of non-executives, including an independent non-executive chair, who will be a Crown appointment, appointed by the Crown in the same way as the Comptroller and Auditor General. The Comptroller and Auditor General will have a fixed 10-year term—previously it was unlimited—and remuneration of the CAG will be agreed by the Prime Minister and the Chair of the Committee of Public Accounts, rather than being linked to permanent secretaries’ remuneration. The report also recommended that the NAO’s audit reports continue to be laid in Parliament, and that the Committee of Public Accounts should continue to hold scrutiny hearings on some of them.
The report’s recommendations were accepted by the previous Government, and provision was included in the Constitutional Reform and Governance Bill, which received cross-party support in the Commons. As the House will be aware, those clauses were lost in the other place during the wash-up stage before the general election, but this year the Government included the provisions in the Budget Responsibility and National Audit Act 2011. The governance reforms envisaged in the provisions strengthen the independence and accountability of the Comptroller and Auditor General in holding the Government to account.
These reforms are entirely in line with the coalition Government’s commitment to transparency and accountability in the public finances, including by implementing whole of Government accounts. As the right hon. Member for Barking noted, effective independent oversight of the efficiency of Government spending is especially important when public resources are under pressure, and these reforms are intended to ensure that the Comptroller and Auditor General and the NAO can fulfil that role.
I support the motion and Sir Andrew Likierman’s appointment as the first independent chairman of the new National Audit Office.
Question put and agreed to.