28 January 2005
Senior backbench MPs are demanding greater transparency over Sir Peter Gershon's efficiency targets amid concerns that advice from public spending watchdogs about achieving savings has been kept secret.
To boost public confidence that future claims of progress towards the £21.5bn total are credible, the government asked the National Audit Office and the Audit Commission to scrutinise each Whitehall ministry's strategy for meeting its targets.
But the Commons' Treasury select committee says this aim has been undermined because the regulators' opinions on departments' Efficiency Technical Notes, as the strategies are known, are not publicly available. Consequently, the MPs say, it is impossible to know what advice has been given and whether it has been taken.
The MPs are also critical of the way the watchdogs' advice has been used. Instead of going direct to each ministry, it has been funnelled through a central scrutiny panel comprising officials from the Treasury and the Office of Government Commerce.
The committee warned that this system 'sits uneasily with the evidence we received that it is departments that are accountable for this process'.
The MPs, who published their findings on Chancellor Gordon Brown's Pre-Budget Report 2004 on January 27, continued: 'We recommend that this advice and each department's response be published.'
An Audit Commission spokeswoman told Public Finance that the process had been governed by the Treasury. 'Our views were provided to the Treasury and OGC and only based upon the draft ETNs.
'It would therefore have been inappropriate for the commission to publish comments provided at an interim stage,' she added.
The committee also scrutinised Brown's £1bn lifeline to local authorities, unveiled in the PBR. That £1bn included the reallocation of £512m from Whitehall departments to councils, and the MPs are demanding to know where the funds are coming from.
'We ask the Treasury to provide us with a breakdown of the £512m,' the report says.
The MPs' report came out the day after the Institute for Fiscal Studies, the influential economic think-tank, warned that Brown would have to raise taxes by £11bn or make equivalent cuts in public spending in order to meet his spending plans.
Its annual 'Green Budget' also warned that if the Treasury stuck to its forecast that the current economic cycle will end in 2005/06, Brown was likely to break his 'golden rule' of borrowing only to invest over the cycle.
PFjan2005
