House of Lords: Domestic Committees

Baroness Cohen of Pimlico Excerpts

Monday 9th May 2016 Lords Chamber

[Baroness Cohen of Pimlico (Lab)]

My Lords, almost everybody in this House has an interest in governance, and many noble Lords have served on the various committees, but perhaps I should declare a particular sectarian interest as the chairman of the House of Lords Audit Committee who is also invited to attend meetings of the House Committee so that I can see its works. I join fellow Members of the House in welcoming the report. It is proportionate, sensible, beautifully written and well organised—but it has one outstanding problem in relation to the place of the chairman of the Audit Committee.

My Audit Committee and I gave written evidence to the Leader’s committee, in which we advised that, given the importance of audit and the unanimous practice in private and public sectors, the chairman of the Audit Committee should have a seat rather than a guest place on the top committee—on the main board, as it were. As the Leader of the House said in her opening speech, the report accepted the importance of the role of audit but recommended that the chairman of the Audit Committee should be an extra member of the new finance sub-committee rather than being a member of the new senior committee, and should not have a seat on the new senior committee.

As I am sure noble Lords are aware, we will deal with a budget of £100 million plus over the next five years, rising to uncontrollable and unseeable amounts when finally we come to restoration and renewal. I say “uncontrollable” because I think that it will be very difficult to stick to the figures that are suggested. The budget will increase exponentially in 2020 when we come to the restoration and renewal programme. The control, of which a formal audit is a key element, of that amount of public money, is critical. I and my Audit Committee in this House have to be represented on the senior committee. We have great difficulty in finding anywhere where the Audit Committee is not on the senior committee, and the five members of the Audit Committee have all served everywhere in the private and public sectors. I should make it clear that this is not a personal bid for world domination via a place on the senior committee—although I can think of worse places to start. What we propose is that the Audit Committee should not only report to but be chaired by a member of the senior committee.

The report postulates a 10-person board containing four Back-Bench Members, two of whom, while not exactly spare, would not be chairing the new finance committee and the new services committee. There would therefore be two Back-Bench Members without specific duties and two new committee members recruited from outside. I welcome this proposal particularly, by the way; I have two outsiders on my Audit Committee and they are both absolutely invaluable, with their wide experience of other places. Any of those four could be chairman of the Audit Committee. Indeed, since the changes to the House of Commons administration, one of the two outside appointees, Dame Janet Gaymer, chairs its Audit Committee and is on its new main board.

I very much welcome this report on governance—which, as my noble friend Lady McIntosh said, is not revolutionary but evolutionary. Otherwise, I feel that we have got pretty much everything right, so it would be a shame to miss the opportunity to go all the way in conforming to public and private sector practice and ensuring the scrutiny of £100 million-plus—and much more in the years to come—in the way that the private sector and most of the public sector do, and in the way that the House of Commons does, by having the Audit Committee chaired by a member of the senior committee who also sits on that committee. When we come to consider the recommendations of the report, I hope that this view can be taken into account.