Budget Responsibility and National Audit Bill [HL]

My Lords, I thank the noble Lord, Lord Sassoon, for introducing the Bill so clearly—he confirmed that, fortunately, I have managed to read it with reasonable accuracy—but he also introduced a number of other points and promises in relation to a framework agreement and potential memorandums of understanding. It is very important that he should produce those, in draft at least, before the Committee stage. I will touch on other contributions to the debate. Like the noble Lord, Lord Barnett, I was pleased that it was largely non-political or at least non-party political. The noble Lord, Lord Newby, had a little poke at us but made the important point that we all want to work together so that reports, as we have in the NAO, enjoy public confidence. He also brought out the whole issue of what the non-executives will really do. The noble Lords, Lord Turnbull and Lord Burns, put the political interference issue in perspective, using the rather nice term ““wishful thinking””, which is probably a fairer way of reflecting how politicians have been involved—in practice, somewhat reluctantly—with responsibility for forecasts. Broadly speaking, we support the OBR because of the extent to which it will take politicians out of that. The noble Lord, Lord Turnbull, made important points about the need to challenge and to have consistent presentation, so that data are easier to use year by year, policy by policy and change by change. A bit uncomfortably I even found myself agreeing with many of the points made by the noble Baroness, Lady Noakes. I, too, would like to see two Bills. Indeed, we are proposing that there should be two Bills. We take the point that writing one’s own school report has a certain lack of comfort about it. We will be probing and pressing strongly in Committee the whole issue of who audits the auditors—who does the peer review—to achieve an appropriate mechanism for a review of the whole thing. I think that her contribution was very useful. Many noble Lords came forward with the idea that we must have more clarity of what the non-executive directors do. The noble Lord, Lord Myners, moved on to the issue of independence, which is key to this proposal. This is about the Treasury’s involvement. I know that the Treasury is a wonderful place, but when I was a public servant the word ““Treasury”” gave one a little cold feeling round one’s heart. It has an ability to permeate its influence through the staff and the charter. The general point made by the noble Lord, Lord Myners, about the Treasury, the staff and the charter is important. I am sure that it is not the Government’s intention to influence the OBR through the charter or the staff, but there may be another Government, with a different attitude, who may find those tools usable. The noble Lord, Lord Myners, mentioned the word ““sustainability””. The word ““sustainability”” is one of the most worrying things in the Bill, because it is presented as if it is a well defined term. It is not; it is very much a matter of what outcomes you want to be sustainable. We will need to probe that in Committee. The noble Baroness, Lady Browning, and the noble Lord, Lord Touhig, clearly have enormous experience of the NAO and I thank them both for their contributions. We will be reading them with care to see whether there are points that we need to probe in Committee through amendments. I have to say that, at first look, the NAO part of the Bill seems fairly straightforward, but it is important that we have the experience of two such contributors to make sure that we get enough depth. The noble Lord, Lord Burns, as well as putting the whole issue of politicians’ involvement in its proper perspective, raised the big question of how we solve this problem: what are the appropriate degrees of separation and what do we mean by ““independence””? He called it ““remit creep””; I would call it ““mission creep””. It is important that we probe what the size of the mission should be in the Bill. I shall be reading Hansard with great care. The noble Lord started to flesh out what these non-executives might do and made the important point that, in the Bill, not only do we need the word ““independent””—it happens not to be there, but at least the concept is—but we must have the resources, the money and people. The noble Lord, Lord Higgins and Lord Barnett, both asked the real question: do we need this at all? We on these Benches think that we do, as a step forward, but there is the whole issue of what it adds and how it usefully contributes. It will have a good brand, but it also needs review, audit and debate involving those who have different points of view.