The Home Office and Department of Constitutional Affairs have been forced to make financial reports every month as part of 'special measures' imposed by the Treasury to improve their financialperformance.
Treasury public services managing director Nick Macpherson was forced to reveal the two departments have been ordered to provide monthly information during a Commons Public Accounts Committee hearing after refusing to name the three worst performing government departments.
The disclosure – after a furious row at a PAC hearing – is a huge embarrassment to two of the highest-profile ministers in the cabinet: David Blunkett, in charge of the drive to reduce crime, and Lord Chancellor Charles Faulkener, the former minister for ‘The Dome’ who is rushing in plans to end the judicial role of the Lords and set up a supreme court.
The committee was grilling Macpherson, Professer Sir Andrew Likierman, the Treasury’s Managing Director, Financial Reporting and Audit, and other senior accounting officers on how they are managing resources to deliver better public services.
Wardle, challenged by MP Ian Davidson to name the three departments whose performance is in greatest need of improvement, refused ‘because it would be invidious’.
He said the Treasury action against the two departments was intended to satisfy themselves that there was sufficient information about expenditure month by month ‘in order that we did not get into a situation of reserve claim and overspends’.
Committee chairman Edward Leigh protested to Macpherson at one point: ‘I have to say you have been in the last three hours a master of obfuscation and there is no point in having a parliamentary inquiry if we are subjected to platitudes.’
It followed questioning by senior committee member Alan Williams over which departments have been fined for overspending – Macpherson said he did not have their names to hand.
Earlier Williams accused Macpherson of talking ‘convoluted waffle’ and complained of lack of proper answers to questions.
He was following up a National Audit Office report suggesting a third of government departments have made limited progress using resource accounting to improve efficiency, with poor value for money going undetected and significant over and underspending at year end.
Macpherson said the number of qualified departmental accounts had fallen from 30 in 1998-99 to six in 2001-02 – the MoD, ONS, Defra, DWP, Home Office, DfES and the Security and Intelligence agencies.
He claimed departments were ‘moving in the right direction’.
Lickierman admitted in response to a question from MP Richard Bacon that although all departments have had finance directors since 1 December, 2003, only 23% are qualified accountants – amending this claim within minutes to further admit that in some cases it was ‘not appropriate’ to have a finance director on the departmental board at all so long as there was ‘someone who is financially qualified who is credible at all levels of the department’.