Audit Commission
Debate between John Denham and Lord Pickles(14 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text
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Mr Pickles
I share my hon. Friend’s concerns about that. At a time when money and resources are short, it is clearly inappropriate for public bodies to use public money to lobby other public bodies. Indeed, my Department has issued instructions to all our bodies, including arm’s length bodies, to cancel all existing contracts with lobbyists, and we will shortly issue guidance to public bodies on the use of lobbyists.
Mr John Denham (Southampton, Itchen) (Lab)
Over the past 15 years, is it not true that the efficiency and effectiveness of local government improved significantly? By 2008, four out of five top-tier councils were rated in the top two performance categories. Councils were making £5.5 billion of efficiency savings in the current spending period, and the Commonwealth Fund recently judged the national health service to be the most efficient health care system among industrialised countries.
Is it not the case that the independent Audit Commission played a significant role in achieving those improvements? Why was the decision to abolish the commission taken in secrecy? It was not in the coalition agreement or in the published work plan of the right hon. Gentleman’s Department. Why did it have to be rushed out without consultation? Will the Secretary of State apologise for briefing that the commission was spending money on trips to the races, when he knew that it hired a meeting room on a non-race day? Why did he hide behind tabloid headlines that he knew were wrong?
When the noble Lord Heseltine set up the Audit Commission, he said that
“because local authorities appoint their own auditors, audit is not seen to be obviously independent of local government.”—[Official Report, 18 January 1982; Vol. 16, c. 53.]
Was not the noble Lord right? Are not the Government recreating between local councils and auditors the cosy, incestuous relationships that also failed Enron and, more recently, the banking system?
The Audit Commission was increasingly looking at whether local services as a whole were working together to provide quality and cost-effective services, and letting the public compare the value for money that taxpayers receive from area to area. Is it not true that the Secretary of State stopped that work because he wants to see unjustified variations in service quality and an unfair postcode lottery?
The Conservatives said at the election that the independent Audit Commission would judge whether changes to local government finance were fair. Has not the right hon. Gentleman now abolished that body so that he can make changes without any effective scrutiny?
The Audit Commission was not perfect. I too blocked the appointment of an unduly highly paid chief executive, but is the Secretary of State not destroying one of the tools for challenge and improvement? It was the Audit Commission to which I could turn to investigate the boomerang bosses who walk out with big pay-offs and go into new jobs. It was the Audit Commission that advised first me and then him on the action to be taken with Doncaster city council. The House might share my fears that this move will end up costing local taxpayers far more than it will save.
Mr Pickles
The right hon. Gentleman seems to have changed his tune slightly, because at the time of the announcement he said:
“I…warned the Audit Commission against excessive wage increases and their fate seemed to be sealed when they ignored this”.
The right hon. Gentleman refers to the use of Newmarket race course. I am not concerned that the Audit Commission spent £40,000 on pot plants, £8,000 on a conference at that race course or £4,600 on bagels. Nor am I worried that it spent £6,000 to celebrate its 25th anniversary at the Reform club, £3,000 on fine dining at Shepherd’s or £170,000 on role-playing and training for its staff. The commission might have made a number of mistakes and errors of judgment, but this measure is about saving the audit function.
The Audit Commission itself recognised that it was working on identical sets of proposals, because it recognised that the future of audit was in the private sector. John Seddon, a visiting professor at Cardiff university business school, recently described the commission as
“an instrument of the regime…The regime has fostered compliance rather than innovation, and compliance with wrong-headed ideas to boot.”
It was once a great organisation, and it did make a change to local government. However, local government has changed itself and it is time to move on. No doubt the right hon. Gentleman will spend some considerable time living on past glories, but the Audit Commission cannot do that. It is time to pass the baton to the National Audit Office for the supervision of the process, and it is massively important to ensure that audit remains rigorous.
Oral Answers to Questions
Debate between John Denham and Lord Pickles
Mr Pickles
I have always felt that Banbury was indeed at the heart of England. Of course, the local enterprise partnerships will give an opportunity for local authorities, business and academic institutions to coalesce around a genuine economic area. We will ensure that they have an opportunity to bring prosperity to that very fine town.
Mr John Denham (Southampton, Itchen) (Lab)
I start by thanking the Secretary of State for his recognition of the two firefighters, Alan Bannon and James Shears, who died fighting the fire in Shirley Towers. Alan Bannon was a constituent of mine, as the Secretary of State knows, and I am grateful to the fire Minister, the Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill), for attending the memorial service yesterday. It was appreciated by everybody connected with the Hampshire fire and rescue service.
On Tuesday this week, the Local Government Association showed that the arbitrary and incompetent decision to suspend the Building Schools for the Future programme has cost local council tax payers in England £162 million in spending on much-needed school projects which will not now go ahead. What efforts did the Secretary of State make to persuade the Secretary of State for Education not to cut that programme? How does he intend to stand up for local councils and prevent his Department becoming the ministry of waste—wasted council tax payers’ money on suspended schools projects, wasted council tax payers’ money as a result of the cuts that he has brought in this year, and wasted money on the opportunity to build new homes?
Mr Pickles
I hardly think that the former Secretary of State is in a position to talk about waste. We have already understood that he has virtually become the patron saint of internal decorators within the Department; £2 million was spent on furnishing at a time when councils were crying out for help. I did indeed speak to my right hon. Friend the Secretary of State for Education, and I was shocked to discover the amount of waste that was within that programme. I was shocked to discover that the achievement of that programme seemed to have made a single consultant a millionaire. Labour Members seemed quite happy to waste other people’s money, but I assure them that this coalition Government are about saving money and are on the side of local councils.
Oral Answers to Questions
Debate between John Denham and Lord Pickles
Mr Pickles
I am very pleased to confirm to my hon. Friend that that is exactly what the Government intend to do, and the matter will be included in the new localism Bill.
Mr John Denham (Southampton, Itchen) (Lab)
I welcome the Secretary of State to his post. He and I have known each other since we worked together at the British Youth Council, which will give the House some idea of how long ago it was. I wish him well in his new role and hope that he does a great deal better in the months ahead than he has in his first month, because has he not failed to defend his Department, meaning that local communities and local services will bear the biggest share of the cuts, and introduced a package of cuts to services and housing that will fall unfairly on the communities with the greatest need? He needs to do better than that. He has failed in his job so far, and he will have to be a great deal more careful in what he does in the future.
Mr Pickles
I am grateful to the right hon. Gentleman for his words of welcome. We have indeed known each other for a very long time, but at least he is still recognisable from his photographs from those days, unlike myself. I wish him well in the forthcoming elections to the shadow Cabinet.
The right hon. Gentleman operated an extremely effective burnt earth policy within the Department. He left a legacy in which the cupboard was bare. All that was missing was a note of apology. The cuts that we have had to make have been imposed on us by him. We have managed to ensure that formula grant has not been touched and that no authority will face a revenue cut greater than 2%. That is much better than the £50 billion of unallocated cuts that was the legacy left to our Department.