By Richard Johnstone | 4 July 2011
Being the first elected chair of the Public Accounts Committee gives Margaret Hodge enhanced authority. But transforming the public sector into an efficient provider of public services is still a big ask, she tells PF in an exclusive interview
There has been a glut of government activity since the coalition took power. In a little over a year, we have had two Budgets, the Comprehensive Spending Review and a round of public service reforms.
In somewhat quieter fashion, there have also been historic reforms to how crucial parts of the Commons operate. For the first time, select committee chairs have been nominated and elected by other MPs.
Margaret Hodge, the latest chair of the Public Accounts Committee and the first woman to hold the post, told Public Finance that being elected gives her and the influential committee ‘a stronger voice’.
Akash Paun, a senior researcher at the Institute for Government, agrees. He says the change is potentially ‘transformational’ for select committees at a time of government reforms. Election gives committee chairs ‘enhanced individual authority and legitimacy and the ability to speak on behalf of collective backbenchers’, he adds.
‘All the chairs there now owe their position to having campaigned – some in competitive elections – and made an appeal to backbenchers from across the House. Until last year, they owed their position to party whips, who they were likely to feel accountable to,’ says Paun.
How Hodge uses her enhanced authority will be closely watched as the government’s reforms progress in the health service (replacing primary care trusts with commissioning bodies led by clinicians), education (the expansion of academies and free schools) and policing (elected police commissioners). All of these have a potential impact on how the PAC, in Hodge’s words, ‘follows the pound’.
The PAC, founded in 1861, is the oldest continuous select committee in Parliament. It counts former prime minister Harold Wilson and ex-Conservative leadership candidate David Davis among its former chairs.
Colin Talbot, professor of public policy and management at Manchester Business School, says it is ‘seen as the most powerful in Parliament’, aside from the Liaison Committee, which comprises all the select committee chairs.
‘Being hauled in front of the PAC is one thing that senior civil servants get very nervous about. In that respect, it has been quite powerful, ’ Talbot says.
Another thing the PAC has been good at in the past few years, adds Talbot, is cumulative learning about what things go wrong and why: ‘Rather than just one headline, they’re trying to work out what goes wrong. From what I’ve seen, Margaret Hodge is keen on that role.’
A minister for most of Labour’s time in office, Hodge confirms this. She will reflect on her first year as chair at CIPFA’s annual conference in Birmingham on July 7. Speaking exclusively to PF ahead of the conference, she says that ‘patterns are beginning to emerge where there’s bad value for money for the taxpayer’. PAC inquiries average 50 a year – most following up examinations by the National Audit Office, with which the committee works closely.
The trends identified by Hodge include not having a constant accountable official in major projects; insufficient programme management or IT skills to ensure value for money; and lack of appropriate data that is used in a timely fashion.
A cynic might say that this is nothing new, and Hodge recognises that her predecessors in the chair would be likely to share her conclusions. But she is determined that the committee will make a difference in these straitened times.
As part of a range of reforms, there will be an expanded role for longitudinal examinations of programmes that have been subject to a number of NAO reports.
Early candidates for this include the Ministry of Defence’s procurement processes – an example that illustrates why ‘we’re so determined to seize change’, she says. ‘We have an inquiry ongoing into the logistics supply chain of the MoD, and I think this is the sixth or seventh report in the past ten years, saying exactly the same ruddy thing.
‘We’re now trying to look at what broad-thrust things the MoD really needs to grapple with to stop this endless avalanche of reports.’ This ‘landscape review’ will be produced by October.
Talbot argues that the committee faces difficulty in holding civil servants to account over issues such as MoD procurement, because they are not accountable to the legislature – only to the executive branch of government.
‘It’s one of the peculiarities of the Westminster system,’ he says. ‘It concentrates far too much power with the executive, and it means that senior civil servants are, in effect, not accountable.’
He says that other reforms to the committee, including the introduction of recall sessions to examine the implementation of recommendations, are ‘pigeon steps in the right direction’.
He adds that the PAC’s role in the auditing of a reformed public sector will be ‘dependent on the fallout from the abolition of the Audit Commission and where responsibilities are located’.
Talbot is concerned that the committee doesn’t have the resources to investigate properly when things go wrong.
Rick Stapenhurst, an adviser to the World Bank Institute, who has undertaken a number of studies into public accounts committees across the world, is also concerned. In a soon-to-be-published paper, The parliamentary Public Accounts Committee: a British Isles perspective, he states: ‘One criticism occasionally made of the UK PAC is that, even with the NAO’s resources and support, [it] can only take a limited look at overall government expenditure and is unable to go into sufficient depth on each issue.’
Hodge admits she is ‘concerned that we’re the only show in town looking at value for money’ if the Audit Commission’s work is to be outsourced to the private sector.
Other government reforms also worry her. ‘The thing that scares me is having to interview the head of every NHS foundation trust, because they’re all accountable to Parliament,’ she says.
She admits she is ‘worried’ about what audits can be undertaken in a more localised system. ‘We’ll end up dip-sticking. We’ll go in and look at a couple of trusts or academy schools – I’m not sure that’s enough for value for money.’
In a bid to overcome the resource limitations, Hodge backs Talbot’s idea of joint investigations with departmental select committees.
In what she calls ‘the most interesting job in opposition’, she admits to sometimes being ‘pretty shocked’ by what the PAC finds. ‘If I weren’t an optimist by nature, I think I’d feel a bit depressed at how difficult it is to turn the great big tanker of the public sector round to ensuring it is a really efficient and effective deliverer of public services.’
Quite a challenge, then? ‘It’s what I’m doing the job for.’
Being the first elected chair of the Public Accounts Committee gives Margaret Hodge enhanced authority. But transforming the public sector into an efficient provider of public services is still a big ask, she tells PF in an exclusive interview
There has been a glut of government activity since the coalition took power. In a little over a year, we have had two Budgets, the Comprehensive Spending Review and a round of public service reforms. In somewhat quieter fashion, there have also been historic reforms to how crucial parts of the Commons operate. For the first time, select committee chairs have been nominated and elected by other MPs.
Margaret Hodge, the latest chair of the Public Accounts Committee and the first woman to hold the post, told Public Finance that being elected gives her and the influential committee ‘a stronger voice’.
Akash Paun, a senior researcher at the Institute for Government, agrees. He says the change is potentially ‘transformational’ for select committees at a time of government reforms. Election gives committee chairs ‘enhanced individual authority and legitimacy and the ability to speak on behalf of collective backbenchers’, he adds.
‘All the chairs there now owe their position to having campaigned – some in competitive elections – and made an appeal to backbenchers from across the House. Until last year, they owed their position to party whips, who they were likely to feel accountable to,’ says Paun.
How Hodge uses her enhanced authority will be closely watched as the government’s reforms progress in the health service (replacing primary care trusts with commissioning bodies led by clinicians), education (the expansion of academies and free schools) and policing (elected police commissioners). All of these have a potential impact on how the PAC, in Hodge’s words, ‘follows the pound’.
The PAC, founded in 1861, is the oldest continuous select committee in Parliament. It counts former prime minister Harold Wilson and ex-Conservative leadership candidate David Davis among its former chairs.
Colin Talbot, professor of public policy and management at Manchester Business School, says it is ‘seen as the most powerful in Parliament’, aside from the Liaison Committee, which comprises all the select committee chairs.
‘Being hauled in front of the PAC is one thing that senior civil servants get very nervous about. In that respect, it has been quite powerful, ’ Talbot says.
Another thing the PAC has been good at in the past few years, adds Talbot, is cumulative learning about what things go wrong and why: ‘Rather than just one headline, they’re trying to work out what goes wrong. From what I’ve seen, Margaret Hodge is keen on that role.’
A minister for most of Labour’s time in office, Hodge confirms this. She will reflect on her first year as chair at CIPFA’s annual conference in Birmingham on July 7. Speaking exclusively to PF ahead of the conference, she says that ‘patterns are beginning to emerge where there’s bad value for money for the taxpayer’. PAC inquiries average 50 a year – most following up examinations by the National Audit Office, with which the committee works closely.
The trends identified by Hodge include not having a constant accountable official in major projects; insufficient programme management or IT skills to ensure value for money; and lack of appropriate data that is used in a timely fashion.
A cynic might say that this is nothing new, and Hodge recognises that her predecessors in the chair would be likely to share her conclusions. But she is determined that the committee will make a difference in these straitened times.
As part of a range of reforms, there will be an expanded role for longitudinal examinations of programmes that have been subject to a number of NAO reports.
Early candidates for this include the Ministry of Defence’s procurement processes – an example that illustrates why ‘we’re so determined to seize change’, she says. ‘We have an inquiry ongoing into the logistics supply chain of the MoD, and I think this is the sixth or seventh report in the past ten years, saying exactly the same ruddy thing.
‘We’re now trying to look at what broad-thrust things the MoD really needs to grapple with to stop this endless avalanche of reports.’ This ‘landscape review’ will be produced by October.
Talbot argues that the committee faces difficulty in holding civil servants to account over issues such as MoD procurement, because they are not accountable to the legislature – only to the executive branch of government.
‘It’s one of the peculiarities of the Westminster system,’ he says. ‘It concentrates far too much power with the executive, and it means that senior civil servants are, in effect, not accountable.’
He says that other reforms to the committee, including the introduction of recall sessions to examine the implementation of recommendations, are ‘pigeon steps in the right direction’.
He adds that the PAC’s role in the auditing of a reformed public sector will be ‘dependent on the fallout from the abolition of the Audit Commission and where responsibilities are located’.
Talbot is concerned that the committee doesn’t have the resources to investigate properly when things go wrong.
Rick Stapenhurst, an adviser to the World Bank Institute, who has undertaken a number of studies into public accounts committees across the world, is also concerned. In a soon-to-be-published paper, The parliamentary Public Accounts Committee: a British Isles perspective, he states: ‘One criticism occasionally made of the UK PAC is that, even with the NAO’s resources and support, [it] can only take a limited look at overall government expenditure and is unable to go into sufficient depth on each issue.’
Hodge admits she is ‘concerned that we’re the only show in town looking at value for money’ if the Audit Commission’s work is to be outsourced to the private sector.
Other government reforms also worry her. ‘The thing that scares me is having to interview the head of every NHS foundation trust, because they’re all accountable to Parliament,’ she says.
She admits she is ‘worried’ about what audits can be undertaken in a more localised system. ‘We’ll end up dip-sticking. We’ll go in and look at a couple of trusts or academy schools – I’m not sure that’s enough for value for money.’
In a bid to overcome the resource limitations, Hodge backs Talbot’s idea of joint investigations with departmental select committees.
In what she calls ‘the most interesting job in opposition’, she admits to sometimes being ‘pretty shocked’ by what the PAC finds. ‘If I weren’t an optimist by nature, I think I’d feel a bit depressed at how difficult it is to turn the great big tanker of the public sector round to ensuring it is a really efficient and effective deliverer of public services.’
Quite a challenge, then? ‘It’s what I’m doing the job for.’
