PracticeAuditMargaret Hodge questions NAO powers to audit BBC and Royal accounts

Margaret Hodge questions NAO powers to audit BBC and Royal accounts

Chairwoman of the Public Accounts Committee Margaret Hodge highlights risk to BBC editorial independence from opening its books up to scrutiny

Coalition government plans to widen National Audit Office powers to include
the BBC and Royal finances are being questioned by newly elected Commons Public
Accounts chairwoman Margaret Hodge.

The first-ever woman chair of the watchdog committee, arguably the most
powerful of the Commons committees, said she is unsure of the extent of the
apparent ‘victory’ for the long-running campaigns for the National Audit Office
to have unfettered access to the BBC’s accounts and those of the monarchy.

The Coalition Agreement underlying the Lib-Con government stated: “We will
maintain the independence of the BBC, and give the NAO full access to the BBC’s
accounts to ensure transparency.”

And in his Budget statement, Chancellor George Osborne said: “The Royal
Household have agreed that in future Civil List expenditure will be subject to
the same audit scrutiny as other government expenditure, through the NAO and the
PAC.”

Hodge, a former Labour Culture Minister is concerned that the BBC statement
contains an internal contradiction, because the BBC maintains opening up its
accounts to scrutiny would undermine its independence.

She said: “We need clarification. It is a welcome statement, but juxtaposing
the two means we need clarification.

“Does it give us the proper access we need to carry out proper value for
money scrutiny for licence fee payers?”

She made it clear she was “100% not” challenging the BBC’s editorial
independence.

The position on the Queen’s finances is more complicated because the PAC has
in the past only been able to look at Ministry for Transport grant in aid for
Royal Family travel, Department of Culture grants towards the cost of
maintaining the Royal Palaces and at second hand at the operation of Prince
Charles’ Duchy of Cornwall (which is formally audited by KPMG).

The NAO lacks direct access to the accounts of the Duchies of Cornwall and
Lancaster and any access at all to the Queen’s income from royal estates like
Sandringham and other properties which some regard as owned by the monarchy and
others by the Her Majesty in person.

Hodge said: “It is early days. I have to understand what precisely is mean by
the statement in the Budget.

“If there is to be serious assessment of efficiency and economy and
effectiveness (of the monarchy), one has to look at the total income and
expenditure. It is difficult to look at just a part.”

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