So-called 'gagging' clauses in PFI and other contracts between government departments and other public bodies and industry could be effectively outlawed if the most influential Parliamentary committee has its way.

The Commons Liaison Committee comprising the chairman of most other committees has called for an extension of provisions that allow the National Audit Office to examine arrangements claimed to be 'commercially confidential' to committees tasked with monitoring individual departments.

The committee said: 'It is inherent in the House's right to control expenditure that the House and select committees should have access to sufficient information about PFI contracts to make possible an assessment of whether they offer value for money, of the extent to which public bodies are locked into long-term commitments and of the extent to which risk is transferred to the private sector or retained within the public sector.'

The report, which demands a major overhaul to improve Parliamentary scrutiny, also called for MPs to see the result of Gershon Efficiency Reviews, previously regarded as confidential but which committees have begun to have access in confidence.

It said claims of confidentiality were also a problem for committees looking into major IT projects and noted that the Information Commissioner and Information Tribunal have rejected arguments that contracts between a public authority and a commercial organisation are wholly exempt from disclosure unless there were identified prejudicial consequences.

The MPs welcomed a Treasury-lead drive to align the three financial control systems used to oversee public spending: departmental budgets resulting from spending reviews, estimates seeking annual Parliamentary authority for expenditure and annual resource accounts.

They said: 'Had such a system been deliberately designed, it could fairly be assumed that it had been set up with the specific purpose of making it impossible to hold the government and departments to account.'