Constitutional Reform and Governance Bill
Philip Dunne raises his concerns about introducing a corporate governance structure to the National Audit Office.
Status of the Comptroller and Auditor General etc
Mr. Dunne: I endorse my hon. Friend's tentative concerns and shall start where he finished-on the extent to which international bodies look to the NAO as a beacon of light in the scrutiny of public expenditure. I have personal experience of the issue from my time on the Public Accounts Committee and, latterly, as a governor of the Westminster Foundation for Democracy. We have entered the Westminster Consortium, a relationship with several other parties that are involved in parliamentary strengthening, and one of them is the NAO. Earlier today, we had an away-day to talk about how we can do more, working together, to spread best practice from this Parliament to other Parliaments throughout the world. It is very valuable work, and the Foreign and Commonwealth Office, the Department for International Development and Governments throughout the world recognise it as such. Although we may think that we are dealing with legislation in isolation, we should not forget that others will look at and, perhaps, imitate the structures that we are putting in place to provide for the NAO's corporate governance over, I hope, the next decades. In that context, it is right that we raise concerns about the proposal.
I do not have concerns in principle, because they were well addressed earlier in the debate by my hon. Friend the Member for Gainsborough (Mr. Leigh), the Chairman of the Public Accounts Committee. However, we must recognise that, essentially, we are introducing a corporate governance structure to an entity that is not a corporate: it is an entity with a chief executive, in the form of the Comptroller and Auditor General, who quite rightly has enshrined in statute a degree of independence and autonomy in terms of his work on audit and value for money, as my hon. Friend and the right hon. Member for Swansea, West (Mr. Williams), the Chairman of the Public Accounts Commission clearly explained.
Mr. Alan Williams: May I clarify that it was in that very area of work, throughout the world and so on, that some of the trouble arose? It is non-statutory work. In that respect, it is true that the board can circumscribe the activities, because that is part of its role and duty; however, it must not and cannot interfere with the statutory duties.
Mr. Dunne: I completely understand that point and am grateful for that clarification. Indeed, as the Father of the House has just made clear, the purpose of the proposals was to deal with deficiencies in the oversight and scrutiny of two simple things-the expenses and the duration of appointment of the Comptroller and Auditor General. To deal with those two relatively minor aspects, however, we have this substantial piece of legislation, and a new panoply of corporate governance that will be injected into the NAO.
All I seek to do is point out to the Minister that we are establishing a panoply of corporate governance that could lead to confusion in the NAO, when all that is required is the scrutiny of those two aspects: the longevity of appointment, about which there is no disagreement at all; and, the board's oversight of expenses and NAO organisation, which may be rather more demanding than was intended of the organisation's time.
David Howarth: The hon. Gentleman must have covered the point by now, but will he clarify that he did not mean that there was any doubt, from the legislation's drafting, that the Comptroller and Auditor General's functions of audit, examination and inspection, which are central to his job, would be in any way compromised? They are specifically preserved by the drafting of schedule 7.
Mr. Dunne: Indeed. If I have given the impression that I am concerned about that, I would like to correct it. The hon. Gentleman has made that clear, and I agree with him.