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I beg to move, That the Bill be now read a Second time.
I am speaking in place of my hon. Friend Mr. Francois, who originally put down his name for this Bill, which originated in the House of Lords. Given his concentration on foreign affairs, however, I have agreed to step into his place.
The Bill would establish a publicly searchable website containing information about expenditure by all Departments and Executive agencies. The idea is not entirely original: the Federal Funding Accountability and Transparency Act was passed in the US in 2006 with bipartisan support, including that of Senator Barack Obama and other leading notables. In the US, any federal expenditure over the value of $25,000 must be recorded and the details must be made available on a website that is accessible by anybody.
The first reason I want to introduce such a website into the UK involves transparency. Where money is spent in the name of the public, it is right in principle that the public should be able to discover what that money has been spent on. That is an entirely sensible principle that should always stand. We should also be aware of evolving public expectations. Debate has raged in this House on recent Fridays about exemptions to freedom of information legislation for matters relating to this House. I have no intention of getting into that particular debate, but I have been struck by the way in which that issue has excited the public imagination. Strong feelings have been provoked, because the public increasingly have high expectations about what information should be available to them. There is a concern about secrecy and concealment, and there is a higher expectation that information will be provided.
Our media are evolving, and they are no longer concentrated in the hands of the few—in some respects, they are in the hands of the many—because of the development of the internet. We have seen the rise of bloggers. At the last US presidential election, for example, individuals with expertise in particular areas were able to participate—who would have thought that knowledge of typewriters used in 1970s army bases would be significant? Amateurs—I do not use the term in a pejorative sense—can engage through new technology in important public debates, but in order to do so they need information.
What better way of providing information is there than putting the details of public expenditure on to a single website, where people can study it and follow the money to see how Government spending is done? That is important not only in terms of transparency, but for the practical reason that we can use the public as a whole to scrutinise public expenditure. The National Audit Office and the Public Accounts Committee do a splendid job, but we can in a sense conscript the general public to hold the Government to account by scrutinising expenditure on a website.
The second reason the Bill should be allowed to progress is that it could enable us to achieve greater value for money. At this point, I am tempted to read out a whole list of areas of Government expenditure that seem absurd—a bumper book of Government waste. Although I could do that, I do not want to introduce a partisan point, because such waste will apply to any Government. There is always a way in which public money could be spent more wisely. The more we can scrutinise that, the better, and the less likely we are to have waste. I would argue that there is perhaps more waste at the moment than there should be, but I would rather not get into that; I would prefer to say that the more we scrutinise, the more we can achieve value for money for the taxpayer. The Government spend an enormous amount of money on our behalf—more than £500 billion last year, and it is continuing to rise. It has risen in absolute terms and has risen considerably as a percentage of gross domestic product. The need to scrutinise the value for money that our Government achieve becomes greater as time goes on. The Bill would give the general public, as well as journalists and politicians—it would certainly be useful for MPs—the tools with which to do that.
Let me briefly outline the Bill's provisions. Clause 1 goes to the heart of the matter—it would require the Treasury to create a Government expenditure website. Clause 2 would give the Government the power to extend that to other public sector bodies, not only Government agencies but any other element within the public sector that receives funds directly or indirectly from a Government Department or Executive agency. Clause 3 would give the Treasury powers to determine content and availability. It would not be appropriate for the Bill to deal with every single detail; it is helpful to set up the framework and then let the details be dealt with by statutory instrument.
Clause 4 provides some important and practical exemptions. Clearly, we would not want to detail expenditure in areas where it would in any way damage national security, the effectiveness of our armed forces, or relations with other states or with international organisations or courts. Clause 5 deals with another practical difficulty with regard to data protection. It provides an exemption in view of the fact that some information would infringe other people's data rights. Clause 6 would give the Information Commissioner the power to examine the Government's compliance with the objectives set out in the Bill.
On clause 5, will the hon. Gentleman confirm that it is his intention to exempt, for example, any payments that might be made to a person in for an industrial injury, which would not necessarily be an appropriate thing to put into the public domain? Indeed, as he no doubt knows, it sometimes enhances the capacity of the two parties—employer and employee—to reach a solution if the matter is kept private.
I am grateful to the hon. Gentleman, who makes an excellent point. I entirely concur. Clause 5 is intended precisely for that kind of circumstance. He provides a useful example that illustrates my point; I am sure that we could come up with others.
Clause 7 would require the Government to provide an annual report to both Houses of Parliament. Clause 8 ensures that any statutory instruments follow the affirmative resolution procedure.
Let me tackle the practical concerns that may arise and perhaps anticipate the remarks of Gillian Merron—I join other hon. Members in congratulating on her new post. I do not know whether this morning was a foretaste of things to come—for her sake, I hope not. However, we see the breadth of her expertise today.
Cost will be a practical concern. An obvious remark is that implementing the Bill will be expensive. However, the evidence from the United States suggests that that is not the case. The US estimate for the trial period, from 2007-11, of the cost of the new website is $15 million. Of course, the US is a much bigger economy than ours, but the figure relates to federal, not state expenditure. None the less, if it costs as little there, we should not be too alarmed about incurring substantial costs in the UK. Indeed, there may be potential savings. For example, if matters are routinely put on the website, savings could be made through a reduction in the number of parliamentary questions.
Let me try to help put the US comparison into perspective. The hon. Gentleman said that the federal Administration, not the state Administrations, incurred the cost. Does he know roughly how many transactions are involved in the $15 million expenditure?
I cannot answer that. The website is being introduced now, in the course of this year. I cannot therefore tell the hon. Gentleman the number of transactions. We should explore the matter in greater detail in Committee, but I stress that it is not expensive. Of course, it is difficult to imagine that greater transparency and throwing light on Government expenditure will not identify considerably greater savings when the information is in the public domain.
Another practical point that may be made is that much information is already in the public domain, for example, on the Treasury website, in the Red Book and so on. However, there is nothing as comprehensive or easily accessible in the UK when compared with the US. We all know, as Members of Parliament, that there are times when it can be difficult to go from one source to another, from one Department to another and so on when searching for information. Although various publications exist, we do not have one specific source. Members of Parliament have the privilege of asking parliamentary questions. Again, I could provide a long list, but it would not be a good use of time, of occasions when information about Government expenditure is requested but the answer is that it could be provided only at disproportionate cost. If we build into the system the provision of information on a website, the problem goes away.
Is my hon. Friend aware that large-scale trawls have taken place when a request has been made under the Freedom of Information Act 2000 and that, for example, health trusts had to provide much information, which proved expensive and distracted them from their work?
My hon. Friend makes an important point. We can ask parliamentary questions and make FOI requests. The general public can do the latter, too. However, that can be time consuming for those seeking and those providing the information. It would be better if that process were more systematic. Let me revert to the US example, which may be of interest to Andrew Miller.
In the US, there is a de minimis requirement that the information is provided if the transaction is greater than $25,000. The Bill would permit a similar provision, which would rule out some of the silly and trivial matters that would cause disproportionate difficulties, while allowing the larger ones to be addressed.
Concern has been expressed about revealing improper information. There are provisions in the Bill to protect personal data and to ensure that national security, our armed forces and our relations with overseas Governments and institutions are protected. That is only right. Given that this is an enabling Bill, there is scope for greater provision for the Treasury to identify particular areas of concern.
This is an important Bill that deserves further consideration. We are living in a time when the public expect to have information and to be able to scrutinise what the Government, of whatever party, are doing. We are living in a world of greater openness and transparency in which more people can participate in the public debate because of the evolution of technology, which is to be welcomed. We are also living in a world in which Government expenditure is considerable. If we wish to enable the public to participate in debates on value for money, and if we want greater scrutiny and greater value for money in public expenditure, the Bill would provide a useful tool for ourselves and the public. It would benefit this country for the Government to have a website setting out their expenditure.
Mr. Gauke is presenting an intriguing idea, and I can certainly see the merits of some aspects of his argument. He is right to say that the nature of the media and of the world that we live in is changing. We now live in a world of blogs and of instant camera shots from so-called newsworthy scenes.
A few months ago, I was privileged to participate in a seminar at St. George's house at Windsor castle, under the chairmanship of Sir David Brown, the chairman of Motorola, entitled "The media in a seamless, mobile age". Some of the issues that we discussed impinge on what the hon. Gentleman has been saying. The nature of the relationship between the media and the Government, and between the media and the people, has changed. The media have become an immensely more powerful tool. Individuals, through blogs, have become their own publishing houses and can portray information in any way that they choose, and it is sometimes a misleading and inaccurate way. Some of us might accuse The Mail on Sunday of doing that on a regular basis.
There is an argument that the more transparent the Government machinery becomes, the more difficult it is for misinformation to be the order of the day. I accept that point. I have some difficulty, however, with the hon. Gentleman's evidence about the cost of the provision. I was trying to do some mental arithmetic on the number of transactions in the Government and their agencies that would be in excess of a certain figure. If we use the American de minimis provision of $25,000 and round it up and call it £15,000, for the sake of argument, that would result in a huge number of transactions. I suspect—I am open to correction when my hon. Friend the Minister replies—that that is not comparing apples with apples. The federal Administration in the United States undertake a lot of detailed expenditure in areas of direct federal responsibility, such as defence. That would involve a huge number of figures, but a lot of that would be outwith the scope of the Bill.
If we analyse the number of direct transactions for which the House takes responsibility, because of our different structure I suspect we will find that the hon. Gentleman's comparison with the United States is not reasonable. For $15 million, we will not get the kind of tool that he wants. The big cost is not the establishment of the tool but the data flows into it. That could only be made feasible through a great deal more integration between operating systems in Government Departments, whereby information from different systems could be integrated at the press of a button.
That would take a leap of faith on the part of Opposition parties, all of which have expressed concern, reservations and opposition to the centralising of data as envisaged in the transformational government White Paper. When the concepts described in the transformational government White Paper bear fruit, the kind of change that the hon. Gentleman suggests would be feasible, and would have a lower impact on the public purse. If, however, somebody offered him a choice between spending £10 million in his constituency or spending it on setting up a central Government website, I know that, as I would, he would regard a brand new hospital, new schools, new roads or more policeman for his constituency as a higher priority.
If the Opposition are serious about helping such transparency to come about, we need them to come on board with the philosophy behind the transformational government White Paper, so that sensible data sharing can take place, with the kind of protections that he rightly describes. In that regard, the role of the Information Commissioner is mission-critical. He may have seen some articles I wrote about that in The House Magazine some months ago . It is possible to create the kind of mechanisms in which the public would have confidence, which would allow data sharing, and which would in turn make his approach perfectly feasible. But I caution the House about leaping into that as a separate, one-off project in isolation. In practice, the cost would be considerably more than £15 million.
I am a fan of transparency—I have always said that if people want to see my office accounts, they are welcome to do so. I have even said that to candidates who have stood against me. We, as public servants, ought to be transparent, and Government Departments should also be transparent. There is nothing wrong in principle with what the hon. Gentleman is saying. However, he should persuade his colleagues to take a more forward-looking approach to those things that are fundamental to the changes that reflect the world in which we live—a world that has to deal with instant responses in blogs and so on.
People expect Governments to change accordingly. Like me, the hon. Gentleman will no doubt receive dozens of e-mails from constituents who think that because they can press a button and send a message instantly, we have the capacity to reciprocate instantly. I am sure that, as a matter of course, he prioritises his responses based on his constituents' needs rather than their ability to communicate rapidly.
We must think the proposal through carefully. I would support the hon. Gentleman in keeping pressure on Her Majesty's Government to improve transparency, but I urge the Opposition to think about my remarks. The hon. Gentleman set out a powerful case for why, if we are to have better governance and more transparency, there is a need to use IT sensibly so that costs are driven down. We do not want a separate system bolted on the end because that would drive costs up, and by considerably more than £15 million in my judgment.
The hon. Member for South-West Hertfordshire espoused the important principle of transparency, which would make the affairs of the Government and information on the use of public money more available to the taxpayer. The Bill builds on a strong feeling that many of us have, which is that the House is not at all good at scrutinising Government expenditure. The apparatus of the House almost militates against it. We have a myth called estimates day. It is a myth because it is supposed to be the day when we look at what the Government are spending, but we do nothing of the kind. We use it as an excuse for a useful debate on a subject of choice, but we do not examine Government expenditure in any realistic way. The level of scrutiny right through the system is riddled with inconsistencies. There is a lack of information, which is what the Bill is about, and a lack of rigour in applying scrutiny.
We have the National Audit Office, and it does an excellent job, as does the Public Accounts Committee. In many ways, however, our colleagues on the PAC merely scratch the surface of Government expenditure. They look at specific topics that have come to the notice or interest of the Comptroller and Auditor General and the NAO, which they scrutinise in depth and produce interesting points for discussion and lessons to be learned by the Government. The great merit of the Bill is that it would open up that information to anyone who wished to access it so that they could ask the relevant question and do the relevant sums. It is not the Government's money; it is our money, because it derives from the taxpayer. People should be able to ask why it is being used in a particular way.
When I was involved in local government, one of the great arguments was whether we could have zero-based budgeting and whether it would be a good idea to build up a budget each year from zero, rather than making incremental changes. There is obvious merit in zero-based budgeting, but it is also extraordinarily difficult and, in terms of national expenditure, probably impossible. One of the substitutes is complete transparency about what is being done.
I see the Bill as one of a series of potential reforms, some of which would be of this House. As I have said, I would like to see estimates days and our scrutiny of the comprehensive spending review much better organised and more focused. We should have specialist resources available to Members and those outside—it has been described as the "Office of the Taxpayer"—so that similar resources are available to those scrutinising the Treasury as there are to the Treasury itself. That would enable better scrutiny of the figures on the proposed website, so that Members could better do the job that our constituents assume we do in scrutinising Government expenditure. If we had such a resource to advise individual Members and Select Committees, they could do their job that much better.
Other simple procedural changes could see evidence-taking sessions on the Finance Bill, as other public Bills now have, with the benefit—if this Bill goes through—of serious information about Government expenditure. We would then be able to ask the questions that should be asked in the context of the Government's expenditure and taxation plans.
There is a raft of reform that would greatly improve our scrutiny of Government spending. The Bill would be a starting point by putting information that is, obviously, known to the Government in the public domain in a much more effective way. However, I have some concerns about the Bill. For example, I am worried about some of the categories of exempt information. I especially note that information could be exempt if it were likely to prejudice relations between the United Kingdom and any other state, international organisation or international court, because we have heard that one before. If we had a Department of State, say the Ministry of Defence, paying large amounts of money to a dignitary of another state, say a Foreign or Defence Minister of a state in the middle east, it would be wise to put the spotlight of publicity on it, so that we could assess whether it was corrupt behaviour or not.
That is an interesting point. Let us not be distracted into a debate on that point, but I think that we will find that the Ministry of Defence is still making payments that look very similar to the payments that were made illegal under the 2002 legislation. It alarms many of us that investigations into what could be a breach of the law have been discontinued, but that is a matter for another day. All I am saying is that transparency produces trust because it allows proper scrutiny. Transparency means that the Government cannot do things that they should not be allowed to do. That is the benefit of arrangements such as those in the Bill, and that is why I will certainly support it if the opportunity arises later this afternoon.
I shall be as brief as I can, because I know that the Minister does not want the passage of this important Bill to be held up. I note that she volunteered to be Minister for Fridays because she enjoys them so much.
I congratulate my hon. Friend Mr. Gauke on the cogent and logical way in which he presented the case for the Bill. There can be no doubt that the people of our country cherish the freedom of information that they have been given already—we need only consider the outrage that was felt when it was suggested that Members of Parliament might withdraw information that had previously been available. Andrew Miller referred to his office expenses, but surely knowing what is being spent in our education system and health service is every bit as important as knowing how many paperclips the hon. Gentleman has bought for his office. That is why the Bill is so important.
One of the problems we face is that the Freedom of Information Act is so often honoured in the breach rather than in the observance. The UK is a big company, and companies present accounts to their shareholders in great detail. UK plc turns over £523.4 billion, so people have a right to know what the money is spent on. It is difficult for members of the public and Members of Parliament to operate within the FOA because they do not always know which questions to ask—as Donald Rumsfeld said, there are known unknowns and unknown unknowns. I am sure the Department of Health and the Treasury hope that many questions will not be asked because the answers might be embarrassing. If we had known beforehand which questions to ask about the release of foreign prisoners, for example, we could have put information about the problems into the public domain.
How often are we told in answer to a parliamentary question that the cost of supplying the requested information is prohibitive? If the Government put the information on the web, we or journalists could do the hard work.
The Opposition are aware that the Treasury must have some knowledge of what is going on in the accounts of UK plc, and we should like more of that information to be available to the general public.
Getting information from the internet is difficult and costly, but the cost should be borne by the people who need the information rather than by the Government who are searching for it. It has often been said that getting information from the internet is like getting a glass of water from a waterfall, but if the Government put information into the public domain, citizens will do the hard work of finding out what they want to know.
The Bill is infinitely sensible. It would provide a free website so that members of the public and others could find information about Government expenditure going back five years. However, there are some details that we shall need to explore if the Bill goes into Committee, as I hope it will. Data protection has been mentioned and there are provisions on national security, but we should consider the de minimis level for expenditure and a sensible definition of commercially sensitive information. I have often asked for information—for example, on a pharmacy in East Ayton—only to be told that it is commercially sensitive. There could be savings in providing such information on a website, because civil servants would not need to search for it to provide answers to parliamentary questions.
We support the Bill in its aim to make freedom of information a reality rather than just a concept that can in practice be fraught with difficulty and prevarication. As my hon. Friend the shadow Chancellor said when he unveiled his "follow the money" campaign in November:
"By allowing the public to follow the money, we would improve accountability for government spending, and increase pressure on the government to justify what it spends."
Many people reasonably ask where the extra tax they have paid has been spent and how much has been wasted. The Bill would empower each of Her Majesty's subjects who has access to the web. If the Prime Minister is so proud of his record at No. 11, why should he fear the Bill? I commend the Bill to the House; it is a no-brainer.
I thank Mr. Gauke for his courteous and kind words about my new position, and for standing in for his colleague, Mr. Francois. I am sure the hon. Gentleman is most appreciative. I, too, am standing in for a colleague who is well respected in the House and who will do a tremendous job in this role—whoever they are.
The Government have made great strides in openness and transparency in many areas, as we have in promoting value for money, especially in respect of public expenditure. The Government do not support the Bill, not because we have any objections to its apparent aims, but because it is unnecessary and because the burden and costs that it would impose have not been adequately considered. I will elaborate on those points.
The Bill is unnecessary because a huge amount of public spending data are already made publicly available. For example, the Treasury's public website already contains a great deal of information on public spending. There are copies of the central Government supply estimates for a five-year period, which contain detailed departmental spending plans for particular financial years. There are copies of public expenditure statistical analyses going back to 1999-2000, in which the data are broken down in a variety of ways, including by departmental groups, central and local government, public corporations, country and region, and function. There are copies of the Budget and pre-Budget reports going back to 1998. There is detailed information on Treasury spending controls, including past and forthcoming spending reviews that set budgetary limits on spending by Departments, and there is a public sector finances databank, which is updated monthly and contains runs of data for various aspects of expenditure and finance. That list of available information is quite weighty, but it is by no means exhaustive. It simply gives a flavour of the large amount of public expenditure information that is already available on the Treasury's public website.
In addition, the websites of other Departments provide a variety of financial information, whether in the form of departmental reports, audited departmental accounts or spending information relating to non-departmental public bodies or Executive agencies. Audited resource accounts for Departments provide the most comprehensive and accurate information on actual expenditure outturn. The Government have made strides to speed up the provision of such information. The faster closing of resource accounts requires those accounts to be presented to Parliament before the summer recess, which I hope the House will welcome. Importantly, departmental reports also provide information regarding public service agreements, to show not only how much we spend, but what we are achieving with the resources. Most public spending data currently made available relate to full financial years—whether outturn or plans.
What is most important is that detailed, accurate and independently audited information about public spending is made available as soon as it is reasonable to do so. Work is already under way in the Treasury to expand further the quantity of expenditure information on the public website, as well as to restructure the information to make it easier to navigate and search. That means that the public website will also hold detailed background and guidance material relating to public spending issues. I hope that hon. Members welcome that development.
A great deal of public spending data, broken down in many ways, is already freely available, but the Bill is unnecessary for a second reason, which is that any interested parties are able, if necessary, to seek further information under the Freedom of Information Act, which the Government introduced in 2000. The Act is part of the Government's drive towards more open and accountable government. It creates a statutory right of access to Government information, subject of course to the necessary exemptions and safeguards, which strike an appropriate balance between openness and the ability of public bodies to conduct their business efficiently and effectively. The Act is an important and powerful tool and any public expenditure information not already published—a considerable amount is published—could be sought under its provisions. Any refusals of such requests must be properly justified and are subject to scrutiny by the Information Commissioner.
A further concern about the Bill relates to the potential for relatively poor-quality data to appear under the planned process. When the issue was discussed in another place it was stated:
"If information is captured within 30 days of expenditure, it should be capable of being accessed via a website. It does not need to be intermediated through some Treasury information system".—[ Hansard, House of Lords, 26 January 2007; Vol. 688, c. 1402.]
That is all well and good, but the quality of data is vital, not least to a consistent approach. Financial information that has been audited, or scrutinised and validated centrally by the Treasury, is surely of greater value in the long term.
As I have said, the burden of cost that the Bill would impose has not been adequately considered. When the matter was discussed in another place, it was stated that the expected cost of the Bill would be £2 million in the first year and £7.5 million over four years. It was acknowledged that such costs were based on estimates produced by the US Congressional Budget Office of the cost of implementing not dissimilar legislation in the US by 2008. The US estimate suggested that it would cost $15 million to set up and maintain such a website over the first five years.
May I respectfully suggest that that might be a question for the Bill's promoter? My job today is to assure the House of the steps that the Government take to provide the fullest information in the most accessible form to the widest number of people.
Several factors undermine the validity of such a broad-brush approach. The Congressional Budget Office report acknowledged:
"The federal government has many databases to monitor and report on federal spending."
It also stated that according to the Office of Management and Budget,
"the government currently collects all the information needed to create a comprehensive database on federal spending."
The US costings make it clear that existing US databases covering such things as federal assistance awards and applications for federal grants would mean that compliance costs would be reduced because the required information was already available. In addition, the US Congressional Budget Office report did not attempt to measure likely compliance costs for those who would have to input the data on the new website. As the report states:
"The bill would require state, local, and tribal governments to provide OMB with information on how they spend money received from the federal government. Such requirements could be costly to intergovernmental entities, but any costs would result from complying with conditions for federal assistance."
I believe that before making such a legislative change in this country, it would be sensible and prudent to have a clear idea of the extent of the burden and cost that would be imposed.
The central requirement of the Bill is the creation of a new website specifically for spending data, but that could be seen as contrary to the recommendations that arose from Sir David Varney's review of public service delivery, "Service transformation: A better service for citizens and businesses, a better deal for the taxpayer"—I hope that we can all unite around that principle. The review was published on
"a freeze on the development of new websites providing citizen or business e-services created by departments, agencies and non departmental public bodies".
As hon. Members will be aware, the pre-Budget report noted that the Government strongly welcomed the report and had agreed to take forward its recommendations.
I urge hon. Members to consider the points that I have made and to join me in concluding that detailed Government spending information is made freely and publicly available and that the costs associated with the Bill have not been properly considered. I ask hon. Members to join me in opposing the Bill.
Let me address two points that the Minister made. She suggested that all the information is already out there. However, surely having one website on which all information—more than is available at present—could be found would bring about greater transparency.
I noted the Minister's comments about costs. However, as my hon. Friend Mr. Goodwill pointed out, I have no doubt that the Bill would lead to savings owing to its effects on freedom of information requests and parliamentary questions. More substantially, given the greater scrutiny for which the Bill provides, we would get better value for money. Some of the most egregious examples of Government waste would be reduced because of the pressure that transparency would bring to bear on the Government and the civil service. I am afraid that I am not persuaded by the arguments presented by the Minister. I believe that the House should give the Bill a Second Reading.