Clause 15

Budget Responsibility and National Audit Bill [Lords] – in a Public Bill Committee at 2:00 pm on 3 March 2011.

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Question proposed, That the clause stand part of the Bill.

Photo of Chris Leslie Chris Leslie Shadow Minister (Treasury)

The clause relates to what might be known as the revolving-door problem, where holders of certain offices are prevented from working for the Crown when their office is terminated or they leave. That is perfectly reasonable in many ways. However, there was some debate in the House of Lords about why the period of two years was chosen to prevent a person ceasing to be CAG from holding Crown office. I think there was an original proposal by the Commission that the ban should be for life—that the person leaving should never be able to hold Crown office—but that was reduced to two years.

My noble Friend Lord Touhig proposed an amendment to strengthen the provisions in respect of the sort of occupations that it was felt appropriate for a former CAG to hold by referring those cases to the Advisory Committee on Business Appointments. The Minister will know that, when she leaves her ministerial office in the not-too-distant future, she will have to apply for permission to the advisory committee if she wishes to take up office after she has left her political career. That applies to a number of senior posts in the public sector, but such a stipulation is not in the Bill. It seems slightly unusual that it has not been referenced. I think the Government tabled an amendment to try to allow the Public Accounts Commission to specify what sort of advisory arrangements would be appropriate, but I am  still not convinced that the absence of the advisory committee is a good thing for the clause. Will the Minister think again about that?

Photo of Justine Greening Justine Greening The Economic Secretary to the Treasury

As we have heard, clause 15 sets out restrictions on the employment of former holders of the office of Comptroller and Auditor General. It might be helpful to go into some of the points that the hon. Gentleman raised about why we put in place the period of two years. Clause 15 restricts the former CAG from working for the Crown or providing services to persons acting on behalf of the Crown for a period of two years after they cease to occupy that role. We think that is a proportionate way of meeting the objective of protecting the independence of the CAG’s office.

The hon. Gentleman asked about the current incumbent’s salary. I should point out that he was recruited in June 2009, so that was probably when his generous salary was agreed. The Public Accounts Commission has recommended a five-year ban, but there is a problem with that.

Photo of Graham Jones Graham Jones Opposition Assistant Whip (Commons)

Is the Minister suggesting that the generous payment is too much?

Photo of Roger Gale Roger Gale Parliamentary Assembly of the Council of Europe (Substitute Member)

That issue has already been dealt with. The hon. Lady introduced it again, but I do not think it is provided for in the clause. However, if the hon. Lady wishes to reply, she may do so.

Photo of Justine Greening Justine Greening The Economic Secretary to the Treasury

I was merely adding to the debate and clarifying the issue for the hon. Member for Nottingham East. It is relevant to the Committee to know the time at which the decision on pay was made, because the hon. Gentleman was effectively trying to say that somehow the Government had not taken the right approach in setting the salary level.

To return to clause 15, a two-year employment restriction, with a related requirement to seek advice after that period, is necessary to protect the independence of the office, without making a former CAG subject to disproportionate restrictions in their ability to work. A five-year ban could result in discouraging candidates, particularly younger ones, from applying. We do not want the post to become a role that somebody does before they retire, for example.

There is just one exception to the two-year ban. Subsection (7) allows a former CAG to hold office as Auditor General for Wales or for Scotland and as Comptroller and Auditor General for Northern Ireland. It would seem perverse for former holders of that office to be denied the opportunity of making their experience and knowledge available to the devolved Administrations if they so wish. Apart from that, we think that a two-year period of restriction gets the balance right. It ensures that their independence is not compromised when they leave office, and it is not so long that it would discourage candidates from applying for the position in the first place.

Photo of Chris Leslie Chris Leslie Shadow Minister (Treasury)

I asked the hon. Lady why reference to the Advisory Committee on Business Appointments had not been made. It would seem appropriate for that to apply here, as it does to other public offices.

Photo of Justine Greening Justine Greening The Economic Secretary to the Treasury

There was no need to put that in the Bill. The clauses clearly establish the way in which the person who has previously been in the role of CAG can go forward should they wish to go into a role that may conflict with their previous position. That is unlike the position that exists for MPs. People who have been Ministers can take roles, but the advisory committee looks at whether those roles are restricted. In this case, it is very clear cut that a full two-year ban is in place. The process maintains the independence of the role of the CAG.

Question put and agreed to.

Clause 15 accordingly ordered to stand part of the Bill.