Sovereign Grant Bill

Debate between Ed Balls and Lord Beamish

Thursday 14th July 2011 Commons Chamber

[Mr Kevan Jones]

I hear what my right hon. Friend says, but unless we know the full amount of money that is being paid to the royal household by other Departments—for instance, the Ministry of Defence—how can we determine, first, that those efficiencies are real and this is not just about moving money across and, secondly, that 15% is the right level?

[Ed Balls]

I shall deal with that point in a minute.

--- Later in debate ---

[Ed Balls]

It is obviously nostalgic for me to be back in Committee debating with the Chancellor of the Exchequer across the Dispatch Box, although I would remind my hon. Friend—these moments have been rare in my parliamentary career—that the Chancellor and the Prime Minister are both Members of this House. Therefore, they are representatives of both the Government and the House of Commons in those discussions. The important thing is that the trustees should not be able to sit on their hands if there is an unexpected surge in revenues that is faster than the trend growth rate of the economy. When the trustees produce a report, Parliament should be able to scrutinise it properly, after a report of the NAO. The latter is clearly set out in the Bill, but at the moment, whether there is a review in the five-year period is at the discretion of the trustees. Parliament should legislate today to say, “If you see something happening to revenues that is outside the Chancellor’s intentions as clearly set out by him, then there should be an immediate review.” It would still be for the trustees to decide what recommendation to make. We are not imposing a cap, because although some would like that, it would be outside the Chancellor’s intentions. I said from the beginning that I would support his reforms, and our amendment 8 delivers his reforms in detail. Therefore, I hope that he will reconsider and support our amendment.

[Mr Kevan Jones]

I think the Chancellor has tried to have an effect on that by, for example, putting a cap on the reserve, but does my right hon. Friend agree that it is also important to see how the reserve is spent? I said to the Chancellor that it does not take a genius or a financial wizard to work out that the way to do it is by keeping the reserve as low as possible by spending the money, so the Government’s proposals will actually lead to more inefficiency, rather than driving up efficiency.

[Ed Balls]

As I said, part of the motivation behind our amendments to the clauses that deal with the role of the NAO is precisely to ensure that the value-for-money question is at the centre of the NAO’s thinking and the PAC’s reports to this House. I am happy with the Chancellor’s view that it should be for the PAC and the NAO to decide when to do those reports, but they clearly cannot have a report looking at value for money without looking at all aspects, and that includes all expenditure that is financed by the taxpayer, and the use of reserves. For Parliament, that is the right mechanism. I understand that not everyone in the House will agree with those proposals, which is why it is important to get on to that debate.