Clause 5

Budget Responsibility and National Audit Bill [Lords] – in a Public Bill Committee am 5:30 pm ar 1 Mawrth 2011.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Kerry McCarthy Kerry McCarthy Shadow Minister (Treasury) 5:30, 1 Mawrth 2011

I beg to move amendment 15, in clause 5, page 3, line 3, leave out ‘(2) and (3)’ and insert ‘(2) to (4)’.

Photo of Kerry McCarthy Kerry McCarthy Shadow Minister (Treasury)

Amendment 14 is consequential upon amendment 15, so we do not need to discuss it in any detail. The amendments reiterate some of the points that my colleagues and I made earlier and that we will address in substantially more detail when we consider how the office will be set up under schedule 1 and how it will be run on a day-to-day basis. This is about whether the relationship between the Office for Budget Responsibility and the Treasury and Government will be truly independent and about how we can ensure the greatest possible transparency in the office’s activities and accountability for what it does and how it goes about doing it. In other words, we are considering how the office can fulfil the requirement under subsection 2 that it must perform its duty under clause 4 “objectively, transparently and impartially”. I have already flagged up my concern about the relationship between the Treasury and the OBR in comments on earlier amendments that were rejected by the Minister.

The Minister has, as we would expect, said that there is nothing to worry about, that the Treasury has no problem with the OBR doing the job that it has been set up to do and that if the OBR criticises or challenges the Government, or even makes them look incompetent and foolish—perish the thought—the Minister, her boss the Chancellor and everyone in the Government from the Prime Minister down would be perfectly happy with the state of affairs and happy for the OBR to challenge, criticise and embarrass the Government in that way and would never reach a stage where they think that a spanner needs to be thrown into the OBR’s works. I am sure that the Minister will forgive those of us in the Opposition who are perhaps a little more, not cynical, but sceptical about how the Government’s undoubtedly good and honourable intentions will end up working in the cold world of realpolitik. We therefore seek to put some additional checks and balances into the Bill, and amendment 15 is one of them.

We think that it would be proper and appropriate for the office to publish details of any contact that it has with Treasury Ministers and officials. In the wider political context, there has been a lot of debate about whether Members of Parliament should publish details of all their meetings with lobby and campaign groups.

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

Although the OBR will move into a separate building, so it will not be anywhere in the Treasury, Robert Chote and his team are still in the Treasury at the moment. To help me understand the proposal, if I were to pass Mr Chote in the corridor—he might be on his way to a meeting—and I said hello to him, and the hon. Lady wants us to publish full details of all contacts, is she saying that that contact should be published by the OBR? That would be the meaning of “all contact”.

Photo of Kerry McCarthy Kerry McCarthy Shadow Minister (Treasury)

Obviously, we are looking towards the time when the OBR will be based in another building. The reason why it is important that it is based in another building is distance. We are also looking at other suggestions, such as the idea that staff from the Treasury should not be seconded. The amendment would reinforce the idea of a certain formality in the relations between the OBR and the Treasury. Obviously, it could get into the realms of ridiculousness. If the Minister, as she says, met Robert Chote by the water machine, said hello and perhaps discussed what was on “EastEnders” the night before, we would not expect that to be documented and published, although I am sure that it would be fascinating to know what their conversation consisted of. We are talking about formal contact and meetings to get some idea of how much influence the Treasury seeks to exert.

As I was saying, people have floated proposals seeking to get to the bottom of the influence of lobbyists, campaign groups and commercial organisations on MPs, saying that the details of all our meetings with such groups should be published. For example, if I were to meet the Child Poverty Action Group or one of the organisations that has lobbied on child poverty, that should be a matter of public record. Other people have countered that by saying that if the requirement was that meetings on the parliamentary estate should be made public, anyone seeking to hide something would simply meet off the parliamentary estate, or they would meet over a quiet drink in an informal setting. I appreciate that it is not the easiest thing in the world to record, but it is a starting point.

The principle of a formal distance and the idea that there should be no informal or behind-the-scenes efforts to influence the OBR’s work are important. One could imagine a scenario where, if the relationship becomes tenser, people from the Treasury might make phone calls to the OBR saying, “We aren’t happy with what you are doing,” and try to bang people’s heads together. We want to avoid that situation, which is why we are suggesting that there should be a formal record of contact.

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

The hon. Lady makes some valid points. She hit the nail on the head, when I asked her to be clear on exactly what contacts she envisaged as needing to be reported. Her amendment refers to publishing full details of all contact. It was helpful for her to clarify that it referred to formal contact and meetings. No doubt, she will welcome the fact that the OBR already publishes a log of substantive contact with Ministers, special advisers and private offices during the forecasting process. In fact, that is its decision; it can publish information relating to its contact with Ministers and officials in the way that it wants.

The amendment is in line with the Government’s objective to ensure that the OBR operates transparently. Clause 5(2) enshrines that and states:

The Office must perform that duty…transparently”.

We agree that there needs to be some transparency on contact with Ministers, special advisers and private officers. That is what the OBR will publish. In the run-up to the Budget, when the OBR is scrutinising the impact of the Chancellor’s policy provisions, details of those meetings can be commercially sensitive if released and might harm the formulation of Department and Government policy.

Publishing all details would place the OBR under an unreasonable burden, but I can assure her that, like all public bodies, the OBR is required to operate under the Freedom of Information Act. Alongside that, it has the standard approach of looking at exemptions. When the hon. Lady’s party was in office, practice was developed on how to strike the balance between transparency for the public and the need for any Government to go through a process of discussing policy without prejudicing that process.

In November 2010, the OBR published a log of all substantive contacts with Ministers, special advisers and private office staff, during the forecasting process shortly after the economic and fiscal outlook. The issue is therefore covered in the Bill, which is why I do not support the amendment, although I welcome the spirit in which it was tabled. I assure the hon. Lady that substantive contact will be published by the OBR, although, because it is independent, it will be its decision to do so.

Photo of Kerry McCarthy Kerry McCarthy Shadow Minister (Treasury)

I thank the Minister for her response. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 ordered to stand part of the Bill.