Public Accounts Commission
Tuesday 20th October 2026
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16:12
16:12
16:12
Speaker 1
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Speaker 1
That's a great question. To some extent, but only to some extent organization itself. I mean, I'll just pay credit to our staff. I mean, across the board they've absorbed methodology change technology change real performance improvement, pressure quality improvements. And they've done a great job in responding to that. And it's involved working differently for all of us. Right, right through the organization. AI means there's more of that to come. We've just rolled out copilot to the entire organization. Everyone's been trained. We're now implementing that. We've got more specific audit tools coming through. So so I think we're trying to judge how quickly the organization can absorb that change and produce high quality work in the meantime.
So I think to some extent is the answer, but I but I wouldn't like to kind of try and spend a very large amount of money in one year and be able to demonstrate value for money as a result. But, Rebecca.
So I think to some extent is the answer, but I but I wouldn't like to kind of try and spend a very large amount of money in one year and be able to demonstrate value for money as a result. But, Rebecca.
16:13
Speaker 2
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Speaker 2
I think perhaps just to reinforce that point, actually, some of that headcount growth that you, that you cited in the last year, a small amount of that actually was to build up some of our digital capability to deliver our digital strategy and to also ensure that we were investing proportionately in cyber security, information security, something that the committee has, has asked us about in the past. And we have earlier this month had our first chief digital and information officer joined us to to help augment those skills so that we can pursue the opportunities that, as Gareth says, are increasingly available to us.
16:14
John Glen
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John Glen
And this year, you've you've had 19 members of staff leave an average exit package of 57,000. Previous year, it was eight on an average 30,000. Now that might just be it's more senior people letting go. Is that what's happened? I mean, do you consider that sort of how do you look at it from a value for money point of view?
16:14
Speaker 2
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Speaker 2
So this so this year, for the first time in a number of years, we we actually ran a voluntary exit scheme where there were 17 exit packages. Agreed. This was very much as we were coming to the end of our first year of delivery of our new strategy to make sure that we've got the skills mix that we need to deliver that strategy, and also to help us manage our overall cost base. We hadn't run a scheme of that nature for some time, so the numbers in previous years were more sort of ad hoc agreements relating to unique circumstances.
16:15
16:15
John Glen
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John Glen
So yeah. And then on the staff turnover, you you were below target this year as you were last year. Would you like to explain to us what's going on there? I think you told us last year that it two low staff turnover could create budgetary pressures and blockages preventing promotion opportunities , obviously. Please address that.
16:15
Speaker 1
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Speaker 1
Yeah. That's a continuing situation actually. So it's a better problem to have than the opposite, you know. And within a few years ago we did have the opposite as the private sector was gearing up coming out of the pandemic. But it is a problem though for us that if turnover is too, too far below our assumptions, exactly the reasons you say that opportunities come up too slowly. And and that just creates kind of a build up of frustration.
16:16
John Glen
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John Glen
So could Gareth, excuse me, paint a picture of an organisation that where people are settled in a role, they're going through the motions, but they're not being challenged, but they don't aspire to the same sort of up and out culture elsewhere. And therefore, how do you sort of ensure that doesn't happen and you maintain high performance levels?
16:16
Speaker 1
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Speaker 1
Well, partly partly through the scheme. scheme you use, Rebecca described partly through performance management. So we have a big focus on high quality performance management. And so I mean obviously a voluntary exit scheme is one thing day to day good management of performance to make sure that we're getting what we need out of all of our colleagues is another learning and development is the third leg.
16:16
Speaker 1
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Speaker 1
Well, because we have a caseload of active performance management cases at any one time and not appropriate in this setting. But, you know, if you're interested in more detail, we can provide that, you know, out of the public. But but we take that really seriously. We have changed our performance management arrangements so that we, we've got clearer allocation of management responsibility. And that's, that's coming through this year and a lot of training for people to make sure they're good at handling difficult cases. And our HR team has done a great job in modernising our processes around that and making sure that we're not in the position you describe.
You know, I think the the results of our work shows that we're not a coasting organisation. We're improving in all of our core areas. And I think we're making a really big impact. And that's that's down to the performance of all of the individuals in the organisation. So the evidence suggests we're making a good job of that. But but you're right. It's it's more difficult when we don't have healthy levels of natural turnover.
And we're, we're always looking at how we manage that.
You know, I think the the results of our work shows that we're not a coasting organisation. We're improving in all of our core areas. And I think we're making a really big impact. And that's that's down to the performance of all of the individuals in the organisation. So the evidence suggests we're making a good job of that. But but you're right. It's it's more difficult when we don't have healthy levels of natural turnover.
And we're, we're always looking at how we manage that.
16:17
Speaker 3
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Speaker 3
I would just like to add the impact of the strategy around impact has also been huge in terms of a culture change in the organisation, because every single member of staff is now really aware that their job is not just to produce a piece of work or to complete an audit, or to do a value for money, study or play a part in a study, but actually to themselves promote a more impactful outcomes. And I've seen in the last 2 or 3 years a huge amounts of energy unleashed internally, with staff feeling incredibly motivated by this much stronger focus on impact, which plays into the HR processes and performance management and all the rest of it.
But it is a sense of people working really hard and a really focused way to deliver impacts and outcomes that are more stretching, actually, than simply doing a job.
But it is a sense of people working really hard and a really focused way to deliver impacts and outcomes that are more stretching, actually, than simply doing a job.
16:18
16:18
Geoffrey Clifton-Brown
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Geoffrey Clifton-Brown
Follow up John's questions? AI efficiency can sometimes be a euphemism for shedding staff, particularly at the lower levels. But on the other hand, you might need less staff at the lower levels, planning the audit or whatever it happens to be. But you're going to need at least as many and possibly more at the higher levels. Is that actually what's happening in your organisation yet?
16:19
Speaker 1
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Speaker 1
Very slight impact on our entry level recruitment, but not significant. And we're in conversation with the big firms, obviously in the same sort of business as we are. And it's very interesting to hear their reflections on the same question. What they're saying is we're not we're actually not backing away from graduate recruitment and school leaver recruitment. We think those people will be doing different things in the future. And we are emphasizing digital skills from the outset, not just accountancy training. And so it's changing the way in which people are trained and their early their early career experience would be different.
You know, in my day, I remember standing by the photocopier thinking, why did I do all that studying at university for to stand by the photocopier? That kind of work is now disappearing from all its. And so junior staff are getting earlier engagement with some of the more judgmental bits of the work, because one of the big. All professions, I think, are grappling with how do we make sure people get first hand experience of the nuts and bolts of this job so that they can make good judgments when they become managers? And and that just means a different way of training them and giving them early work experience.
But in numbers terms, actually, we're continuing with a 55 graduate recruitment this year, similar to last year. It's not it's not affected that number yet. Thank you. Thank you chair.
You know, in my day, I remember standing by the photocopier thinking, why did I do all that studying at university for to stand by the photocopier? That kind of work is now disappearing from all its. And so junior staff are getting earlier engagement with some of the more judgmental bits of the work, because one of the big. All professions, I think, are grappling with how do we make sure people get first hand experience of the nuts and bolts of this job so that they can make good judgments when they become managers? And and that just means a different way of training them and giving them early work experience.
But in numbers terms, actually, we're continuing with a 55 graduate recruitment this year, similar to last year. It's not it's not affected that number yet. Thank you. Thank you chair.
16:20
16:20
Speaker 1
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Speaker 1
In summer 25? We did, which is the period covered by this report? Right. And that was a step up from the previous year. But we we hit some barriers in, in that summer to, to hit the target. We redouble our efforts. And of course, since we published this annual report and accounts, we've had the summer recess for 26. And so pleased to say that we actually did achieve 70% this year. So this long haul back to a timely set of accounts from the disruption caused by the pandemic. We're getting close to where we want to be now, and not just 70% by this summer.
We're also expecting to have more than 90% finish by the end of this month. Big step forward from previous years. Our target for next year will be 70% by the summer and 100% by the end of October. And to me, that's got got the accountability framework for accounts into the right position for central government. And, you know, I'll be very pleased if we're if we're in that position this time next year. So again, just just wanted to pay tribute to the staff who delivered that. That's a lot of really complex work all by the summer recess, less than four months after the year end that these accounts relate to.
That's a real achievement. The and there were departments that were pre recessed for the first time in several years . Defra, Disney's and Mod recovered from the severe problems it had the previous year linked to the Afghan resettlement scheme and missing provisions and so on. And Mod was on time and unqualified this year, which was a significant achievement for for that department. So some really, you know, this really matters. We're talking about a lot of public money being properly accounted for on time. And apart from anything else, it frees up the finance teams in those organisations to do what they should be doing, which is adding value to the financial planning of that department, not still completing the accounts months and months after the year end.
So always around. That's real progress, I think.
We're also expecting to have more than 90% finish by the end of this month. Big step forward from previous years. Our target for next year will be 70% by the summer and 100% by the end of October. And to me, that's got got the accountability framework for accounts into the right position for central government. And, you know, I'll be very pleased if we're if we're in that position this time next year. So again, just just wanted to pay tribute to the staff who delivered that. That's a lot of really complex work all by the summer recess, less than four months after the year end that these accounts relate to.
That's a real achievement. The and there were departments that were pre recessed for the first time in several years . Defra, Disney's and Mod recovered from the severe problems it had the previous year linked to the Afghan resettlement scheme and missing provisions and so on. And Mod was on time and unqualified this year, which was a significant achievement for for that department. So some really, you know, this really matters. We're talking about a lot of public money being properly accounted for on time. And apart from anything else, it frees up the finance teams in those organisations to do what they should be doing, which is adding value to the financial planning of that department, not still completing the accounts months and months after the year end.
So always around. That's real progress, I think.
16:22
16:22
Speaker 1
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Speaker 1
Well, soon after the end of October, but the that's the purpose of setting this kind of firm deadline of the end of October for everything, which will be next year's target. That's a deliberate message to the small number that have drifted on towards the end of the calendar year, because often in in some cases, they have got used to a particular rhythm and, and a small organisation that takes some resource to shift. So we're, we're working with them now to say, okay, this is now the expectation Treasury is taking the same line as well. And what does that mean for every organisation moving its audit committee dates, releasing some resource to get this thing done in a more timely way.
So yeah, I'll be very pleased if we if we hit those deadlines for next summer.
So yeah, I'll be very pleased if we if we hit those deadlines for next summer.
16:23
Chris Vince
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Chris Vince
Thank you. So positive. Is 83% of your value for money reports met internal standards, which is higher than 70% target and higher than corresponding scores for financial audits, as we've discussed. So why do you think it is then? And it says on my sheet, MPs and senior officials, not necessarily this MP, but they routinely scores your quality of value for money, reports lower value for money work in general, lower than financial audits.
16:24
Speaker 1
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Speaker 1
Yeah, obviously, we're asking those questions. We're asking MPs as a whole, not just the ones who engage with our work directly through PAC and other committees. The actually, the numbers aren't bad. It's not as if they're poor. They're of course, what they what they mean by quality is very different to the technical assessments of quality that we're measuring through the rest of our processes. So these are different angles on the quality question. All of them are valid of course. And that's why we have them all in here as performance indicators. So we want to drive that up for MPs as a whole.
We're trying to increase awareness of our work. We have a fortnightly newsletter to MPs which is increasingly well used actually. And but we're also targeting researchers and MPs offices because we know, we know how busy MPs are, how difficult it is to get through the inbox of a typical MP inbox. And so we're working hard with the staff side as well to make sure that they pick things out and say, actually, this one is worth highlighting through the rest of the spam that they otherwise engaging with. So it's a, it's a constant challenge. You know, we use this to challenge ourselves and say, how can we drive these numbers up and get better results?
We're trying to increase awareness of our work. We have a fortnightly newsletter to MPs which is increasingly well used actually. And but we're also targeting researchers and MPs offices because we know, we know how busy MPs are, how difficult it is to get through the inbox of a typical MP inbox. And so we're working hard with the staff side as well to make sure that they pick things out and say, actually, this one is worth highlighting through the rest of the spam that they otherwise engaging with. So it's a, it's a constant challenge. You know, we use this to challenge ourselves and say, how can we drive these numbers up and get better results?
16:25
Chris Vince
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Chris Vince
Yeah. No thank you. So you don't feel as suggested that that value for money quality standards are lower compared to financial audits? It's just the perception. Yeah. That's fine. My last question then the proportion of your expenditure on financial audits has increased compared to last year, meaning proportionately less is now spent on those value for money, that money value for money work. Is there a risk of financial audit work becoming too much of a focus?
16:25
Speaker 2
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Speaker 2
I think it's important to bear in mind there some of the things that Gareth was speaking about earlier, about the way in which our financial audit portfolio as a as a whole has has grown over a number of years. And that is really the driver of, of, of the increase in the headcount and the increase in the expenditure there to put some numbers around that. Back in 2017, 2018, we certified 370 accounts in the year that we're looking at now. That's 413. Obviously within that there's quite a variation. Some of those are quite significant endeavours.
So it's not that the expenditure on value for money has has gone down. It's that it's the proportions. But we are really keen to make sure that we're continuing to invest in our value for money work. And in the current year that we're in, we've particularly put some resources aside to modernise our reporting and how it looks on our website, for example. It's an example of that continued investment.
So it's not that the expenditure on value for money has has gone down. It's that it's the proportions. But we are really keen to make sure that we're continuing to invest in our value for money work. And in the current year that we're in, we've particularly put some resources aside to modernise our reporting and how it looks on our website, for example. It's an example of that continued investment.
16:26
Sarah Olney
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Sarah Olney
Thank you, chair, and apologies for my late arrival. So risk reporting, you changed the number of principal risks that you report against this year previously 24, now nine. And obviously this is to align with the strategy. But does that mean that there's a lower level of detail in your risk management processes.
16:26
Speaker 2
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Speaker 2
It certainly doesn't mean that there's a lower level of of detail in our overall risk management processes. What it does mean is the way in which we're looking at risk is a bit more focused at the executive team and at at the board level. So as well as making sure that our risk framework aligned with our strategy, we also did a refresh of our framework to make sure we were in line with best with best practice, and adopted a framework whereby we categorize the principal risks, those that we think have the greatest impact on our strategic performance, our reputation, for example.
And underneath that, there are a series of component risks, broadly the same number that we had before that feed into that. And that's supported by a kind of rigorous bottom up risk assessment process with business owners throughout the business, so that we are looking at a comprehensive picture at the executive team.
And underneath that, there are a series of component risks, broadly the same number that we had before that feed into that. And that's supported by a kind of rigorous bottom up risk assessment process with business owners throughout the business, so that we are looking at a comprehensive picture at the executive team.
16:27
16:28
Speaker 2
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Speaker 2
So? I think in terms of impact, this was partly a response to the strategy and the fact that we've upped our ambition in terms of the impact that we're looking to achieve, and specifically the ambitions that we that we have set to positively influence productivity, resilience and financial management in government. And we don't want to be complacent. So we have been using that to challenge ourselves. And the board have very much been challenging. Are we doing as much as that as that strategy indicates that we should be should be doing there? And in response to that, we have a new parliamentary engagement plan.
We've refreshed our communications roadmap, but we also think very deeply, as Gareth said earlier, about the impact that we are looking to achieve at the point at which we're commissioning our vfm programmes of work, for example, in terms of service delivery, this connects back principally to making sure that we are achieving those ambitions that Gareth has already spoken about in terms of improving the timeliness of, in particular, our financial audit work, to make sure, as we have done this year, we've met the 70% pre recess, but continued focus in the coming years.
We've refreshed our communications roadmap, but we also think very deeply, as Gareth said earlier, about the impact that we are looking to achieve at the point at which we're commissioning our vfm programmes of work, for example, in terms of service delivery, this connects back principally to making sure that we are achieving those ambitions that Gareth has already spoken about in terms of improving the timeliness of, in particular, our financial audit work, to make sure, as we have done this year, we've met the 70% pre recess, but continued focus in the coming years.
16:29
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16:30
Speaker 2
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Speaker 2
But we have I mean, it's all of the things that Gareth has spoken about in terms of focus on performance management, our wellbeing strategy, our sickness absence has continued to fall almost month on month. We're now down at I think it's about 5.5.2 days per FTE, which is a very strong position and again, an indication of an organisation that is thriving rather than one that is is perhaps stagnant.
16:30
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16:30
Speaker 4
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Speaker 4
Chair Sarah, before we finish, Gareth, a number of people have approached me about the future accountability of governments for inquiries and the recommendations of those inquiries. And I know you may have had a number of conversations with people. I'll declare my interest that I'm the chair of the all party parliamentary group on hemophilia and infected blood. And so duty of candor and the accountability of for, for for Sir Brian Langsdorff's report is dear to my heart. So. And the suggestion has been that the National Audit Office is the is the place where this should sit and that that that should hold the ring on holding the government to account for how it responds to inquiry recommendations.
Do you have any advice or a view on on that debate?
Do you have any advice or a view on on that debate?
16:31
Speaker 1
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Speaker 1
As you say, we've been approached by government on exactly that point. You know, a kind of a strong level of dissatisfaction in Parliament. I think about the rigour with which public inquiry recommendations are followed up, and whether they've been implemented in the way that was intended from when it was when the recommendations were made to many inquiries. And the most recent one is the Thirlwall inquiry into the Lucy Letby case and that appalling set of circumstances up in Cheshire and and the judge in that case made a specific recommendation that the Nao should be following up NHS related inquiries because they were so concerned that previous recommendations hadn't been implemented at that trust in question and could have helped prevent the terrible events there.
So I completely understand the seriousness, seriousness of the issue and the kind of public interest in improving the position. The point I've made to government is that it needs to be a really carefully thought through here, because the Nao cannot become part of government's own system for managing these risks. We can stand outside that system and audit it, as we do with other areas of public expenditure. And so getting the design of this right is absolutely crucial that at the moment, I don't think government has a reliable system for monitoring the implementation of public inquiry recommendations, and that is the problem that needs to be fixed first.
Then a question about can the Nao provide assurance to Parliament on whether that system is working effectively is a legitimate question and, you know, obviously prepared to engage on that. But we have a we have a really, really strong. Strong sense that we we mustn't allow our mission to to kind of creep. And we must absolutely hold on to our mission to support Parliament in scrutinising public expenditure. That's that's what the Nao is for. You can make a case that this is a legitimate extension of that. But it needs to be really carefully grounded in that in that governance structure that I've mentioned, so that we're not being drawn into something we should be independent of and that, you know, of course you'd be you can be so pure that you're ineffective.
So I'm aware of that risk as well. But but these are the issues that we've we've suggested that we work through with government before they're taken any further. Clearly, Parliament's view on this, because being clear where the parliamentary audience for that question, I think that's crucial, because otherwise we can't deliver our mission in supporting Parliament and helping make government more accountable.
So I completely understand the seriousness, seriousness of the issue and the kind of public interest in improving the position. The point I've made to government is that it needs to be a really carefully thought through here, because the Nao cannot become part of government's own system for managing these risks. We can stand outside that system and audit it, as we do with other areas of public expenditure. And so getting the design of this right is absolutely crucial that at the moment, I don't think government has a reliable system for monitoring the implementation of public inquiry recommendations, and that is the problem that needs to be fixed first.
Then a question about can the Nao provide assurance to Parliament on whether that system is working effectively is a legitimate question and, you know, obviously prepared to engage on that. But we have a we have a really, really strong. Strong sense that we we mustn't allow our mission to to kind of creep. And we must absolutely hold on to our mission to support Parliament in scrutinising public expenditure. That's that's what the Nao is for. You can make a case that this is a legitimate extension of that. But it needs to be really carefully grounded in that in that governance structure that I've mentioned, so that we're not being drawn into something we should be independent of and that, you know, of course you'd be you can be so pure that you're ineffective.
So I'm aware of that risk as well. But but these are the issues that we've we've suggested that we work through with government before they're taken any further. Clearly, Parliament's view on this, because being clear where the parliamentary audience for that question, I think that's crucial, because otherwise we can't deliver our mission in supporting Parliament and helping make government more accountable.
16:34
16:34
Speaker 1
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Speaker 1
So particularly if there are issues of clinical practice, for example, which, you know, more specialist inspectorate than it is the Nao, but it kind of makes the point that if the question is, can the government department responsible evidence that these recommendations have been satisfactorily implemented, then the evidence base for that would be the reports of Inspectorates to say, yes, we're satisfied that clinical practice has changed in the way intended. Here's the evidence. That's why. But we can we will be reporting one layer up from that, which is does government have the evidence to show that these recommendations have been satisfactorily implemented?
And that's at the moment I haven't seen that that framework is in place to deliver that evidence base, because you can see in that case, then that would be something the Nao could could add value to. But what we can't do is go in and, and, and give a properly informed judgment on whether clinical practice has changed in every NHS trust in the country.
And that's at the moment I haven't seen that that framework is in place to deliver that evidence base, because you can see in that case, then that would be something the Nao could could add value to. But what we can't do is go in and, and, and give a properly informed judgment on whether clinical practice has changed in every NHS trust in the country.
16:35
16:35
John Glen
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John Glen
Yes. I mean, just on the Infected Blood Compensation Authority, I declare an interest because I was the minister responsible for passing the legislation for it being set up. Indeed, it was set up remote from any Department of Government at the insistence and request of many of the victims. However, the point that the chair makes is a reasonable one in that if you've legislated with the expectation of certain outcomes, and then there is, because it's so independent of the Department of Health or the Cabinet Office or whatever, we are, then two years later, in a situation where as parliamentarians, we can't apparently achieve any accountability.
And I think what you're saying is that it's quite delicate and difficult for you to insert yourself into that audit process. If they are an entity that is sort of remote from one department and just dependent on legislation. Is that correct?
And I think what you're saying is that it's quite delicate and difficult for you to insert yourself into that audit process. If they are an entity that is sort of remote from one department and just dependent on legislation. Is that correct?
16:36
Speaker 1
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Speaker 1
Not quite. Because first of all, we are the auditor of the compensation, and we qualified their accounts in the first year because the estimate of the liability was patchy. That's improved significantly for this summer. And so they're much better position this summer. So financial audit is clear. Actually, we did report on their performance in implementing their responsibilities for paying compensation as part of the report that the Public Accounts Committee took as a basis for two separate evidence sessions earlier this year. Really successful week, I think, for the Public Accounts Committee. And that session had witnesses from the Ipsa itself, from the Post Office and from the the Military Veterans Scheme and the Windrush scheme.
So we had four schemes accountable to Parliament for their performance in paying compensation. And that session was informed by a session with representatives of the victims in each case beforehand as well. So, so the existing framework can cope with holding public bodies to account, including independent public bodies of that kind. This question is more the the technical question of the public inquiry that gave rise to that. Have its recommendations all been satisfactory?
So we had four schemes accountable to Parliament for their performance in paying compensation. And that session was informed by a session with representatives of the victims in each case beforehand as well. So, so the existing framework can cope with holding public bodies to account, including independent public bodies of that kind. This question is more the the technical question of the public inquiry that gave rise to that. Have its recommendations all been satisfactory?
16:37
16:37
John Glen
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John Glen
To respond to the report and discern what they think is the appropriate response to an inquiry? So how could you possibly be holding to account? Because, in a sense, the government's judgment, you might dispute it, whichever the government is, but you're there to audit what they've said they will do with the report.
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16:38
Speaker 3
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Speaker 3
Yes, exactly. We are going to be discussing this later this year. So actually, this is a really helpful input. But we're talking as much as anything, I think about a sort of third line of defence, so that we're not actually involved in the mechanics of the rights and wrongs of particular recommendations, but the fact as to whether those recommendations have been implemented. So if we if we were to consider this the right thing to do, I think we'd be extremely careful about the terms and the conditions, as it were, of any engagement. But we do think it's something important for us to consider.
16:38
John Glen
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John Glen
In something like that. There was an iterative process through statutory instruments. After conversations with the victims, over changing the parameters of the scheme to reflect different needs of different cohorts of victims. So to have a coherent single point of reference to audit would be quite challenging until the scheme is fully embedded, which has only happened relatively recently.
16:39
Speaker 1
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Speaker 1
I think it is, and I do understand the impetus behind this, which is it's very frustrating to see public inquiry recommendations that could have headed off subsequent problems and weren't implemented. I can understand the frustration, but just this discussion has illustrated the complexity of it. Yeah.
16:39
Geoffrey Clifton-Brown
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Geoffrey Clifton-Brown
The nag was kind enough to mention the PAC inquiry into this matter. I think that from all of the four groups we actually had in front of us, and a lot of the other witnesses, the feeling was very much that government department that had caused the injury in the first place should not be setting up a scheme to compensate the victims. And therefore without I mean, just from the hearing we haven't issued or we haven't had a response from the government yet, was that there should be some form of independent standing body there so that when the next scandal comes along and you've mentioned one that has come along energy, it's there to draw on all the experience of the previous schemes that went wrong and try and produce some common standards across new schemes, you know, trying to resolve the thing as quickly and as judiciously free as possible so that victims can get their compensation quickly and fairly.
16:40
Speaker 4
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Speaker 4
Yeah, it's just not it's not just about compensation. It's about justice, which encompasses a whole lot of things as well. But compensation is at the heart of it. And that's absolutely right. That's my understanding of where we need to get to, because what happens is that the government accepts recommendations of of inquiries, but no one holds them to account as to whether they do anything about that and, and how they follow through and how they're implemented. And there is there needs to be an independent body that sort of stands equivalent to a body like the Nao, and that has that responsibility and can hold government to account.
So they literally pick up responsibility for the inquiry's recommendations. Being taken forwards , independent of government is where I think we need to go. I know others disagree and think that that should be the select committee's. I'm not convinced that they have that sort of they have the resources to be able to do that. But anyhow. Thank you chair.
So they literally pick up responsibility for the inquiry's recommendations. Being taken forwards , independent of government is where I think we need to go. I know others disagree and think that that should be the select committee's. I'm not convinced that they have that sort of they have the resources to be able to do that. But anyhow. Thank you chair.
16:41
Geoffrey Clifton-Brown
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Geoffrey Clifton-Brown
I mean, it would be quite possible once the standing Committee had established the terms of an inquiry and the government had accepted those terms, because government has always got to accept it, because they're going to have to pay in the end. That I mean, I don't want to put words in your way, Gareth, but you could I mean, these are only going to be fairly large matters because the small matter will government will deal with in another way. You could then become the auditor of that particular scheme.
16:41
Speaker 1
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Speaker 1
, which we have. So all the compensation schemes do get audited by us. So that that that's definitely covered. It's more the it's more the situation of. And I think I think this discussion shows this is a question for government really. How does government demonstrate that it has a grip on the public inquiry recommendations that it has agreed to implement? And how is it accountable to Parliament for doing that? And so we can help with the debate because we've got some practical experience. But in the end, this is a matter for Parliament and Government, I think, to as to come to a view on how how do we make sure that we have better accountability than we currently do for acting on these recommendations?
16:42
16:42
Speaker 4
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Speaker 4
Well, as chair of the Appg, I might question just how independent it is, but given some of the things that are in, in the path of, you know, dealing with some of the claims that are currently waiting to be to be finalised so that that rabbit hole we won't go down right now, but thanks. But but but anyhow, thank you for your answers on that. I think this is this is going to be a debate that's going to be very important going forward. So I appreciate you giving your time to to answer those questions for us at the end of this meeting.
But before we do conclude, Dame Fiona, this is your last annual report and accounts session with the Commission as chair of the Nao board. Looking back on the your six years as chair, how do you think the relationship between the Nao and Parliament has evolved?
But before we do conclude, Dame Fiona, this is your last annual report and accounts session with the Commission as chair of the Nao board. Looking back on the your six years as chair, how do you think the relationship between the Nao and Parliament has evolved?
16:43
16:43
Speaker 3
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Speaker 3
Thank you for the opportunity to speak briefly. Well, it has been six fascinating and indeed quite tumultuous years because I came in when Covid was in full spate. We've seen the Brexit settlement since then. We've seen actually a huge churn in both prime ministers and in permanent secretaries with whom we deal regularly. And indeed, you know, global uncertainties, which really affect how people feel about public expenditure. But I believe through that period, we've built an ever stronger, ever more purposeful and ever more effective now. And I'm really proud of that. And perhaps I'm particularly proud of our strategy.
When I came in, it was very clear that the role of chair here is unusual. It's very strategic in focus, but fortunately I love strategy, so that's suited me very well. But actually the strategy which we are discussing the first year of here today is very different. It's we call it trust, value, impact, and it is about using every ounce of our energy , not only to audit and to do a series of studies on government expenditure, but actually to help the government do a better job. And I think we've demonstrated in many ways how that has both liberated the organisations potential, but actually has also beginning to lead.
And we are being deliberately modest about what we've done so far and setting ambitious objectives, but to our two strategic outcomes of greater productivity and resilience in public services and improved financial management in government, both of which I think are absolutely critical to our role. So just briefly on on audit, I think we've seen real improvements in quality, which you have each year challenged and tested us on through wise investment in both people and technology and, and in culture change. We're never going to be complacent about audit quality, but we are increasingly confident that we can hold to that level of sustained quality.
There's been a, for me, really interesting creative shift between audit as a compliance tool where you simply have to do it to using audit as a way of improving insight and analysis of where the money goes in order to do a better job. And I think that's a really interesting development and there's more to go. And actually the bringing in the tops, the train operating companies is a really good example of that. We're not just auditing them, we are drawing insights and learning across different companies in order to demonstrate how they could collectively be more effective and do a better job.
And of course, we've talked today about the local audit office and improving audit at the local level, which has been an absolutely shaming gap in recent years. And now at last, it will take time, but we can see real improvements on value for money. We have had a similar, really heart searching discussions about making best use of our capabilities in those areas. I think there's been an ever more strategic approach to the value for money studies we do. We're obviously very keen to ensure that the Public Accounts Committee has the reports that it needs and values from us, but I think what's been exciting is to see the development of more cross-government studies and whole system approaches.
I was particularly taken by the asylum report, which I think is a model for future systems that cross departmental boundaries and are quite difficult for government to track, but we can really be helpful in that respect. And our new studies, which we're just beginning to do, of particular initiatives of government departments, for example, the one on Ministry of Justice use of AI to ensure that the records that need to be produced in court are both present and correct, is a is a wonderful example of a very helpful tool, which I think will really benefit departments.
So I think I think in all of those areas, we've made real progress. And of course, there's now this new approach to the scrutiny of sensitive defence expenditure, which I think is a major step forward. So you asked me to speak about challenges for the future, and since we've already discussed them today, I can be very brief on those. One is clearly AI, where we are both determined both internally and in our audit of government departments and value for money studies, to watch both the potential of AI, but also the need for clear guardrails. I'm not saying anything original or new there, but it's both a vital tool, one that is completely with us, so impossible to ignore, but also has to be carefully managed and carefully observed.
Second, devolution, and we did speak at some length about this this afternoon is is huge potentially. And I think we can play a very helpful role, both in terms of the devolution framework, but also our work with the local audit office. Devolution won't work unless we can assess whether it is working. There will be huge questions about postcode lotteries and different outcomes in different parts of the country, but actually I think we are well placed to support the local audit office, as well as doing our own work to ensure that the parliamentary accountability is clear and well judged.
And finally, I suppose a personal plea from me is, is that I hope we are entering a slightly more stable period simply because some of the issues that we know are really important long term issues have been squeezed out by short term crises. And so the opportunity, I think, to use our expertise and our very good and strong strategy to move forward on important issues, whether it's climate change, food security, public health. There are so many areas. But taking a longer term view, social care is another I think is going to be really important. So that's my tuppenny worth as I approach the end of a job that I've really enjoyed.
I'm hugely grateful both to my board, but to Gareth and the executive team and in fact , to all the staff at the now, they are an amazing bunch of very committed, very bright, very dedicated people, and I think we're extremely lucky to have them working so hard to ensure that Parliament has the assurances that it needs. Thank you.
When I came in, it was very clear that the role of chair here is unusual. It's very strategic in focus, but fortunately I love strategy, so that's suited me very well. But actually the strategy which we are discussing the first year of here today is very different. It's we call it trust, value, impact, and it is about using every ounce of our energy , not only to audit and to do a series of studies on government expenditure, but actually to help the government do a better job. And I think we've demonstrated in many ways how that has both liberated the organisations potential, but actually has also beginning to lead.
And we are being deliberately modest about what we've done so far and setting ambitious objectives, but to our two strategic outcomes of greater productivity and resilience in public services and improved financial management in government, both of which I think are absolutely critical to our role. So just briefly on on audit, I think we've seen real improvements in quality, which you have each year challenged and tested us on through wise investment in both people and technology and, and in culture change. We're never going to be complacent about audit quality, but we are increasingly confident that we can hold to that level of sustained quality.
There's been a, for me, really interesting creative shift between audit as a compliance tool where you simply have to do it to using audit as a way of improving insight and analysis of where the money goes in order to do a better job. And I think that's a really interesting development and there's more to go. And actually the bringing in the tops, the train operating companies is a really good example of that. We're not just auditing them, we are drawing insights and learning across different companies in order to demonstrate how they could collectively be more effective and do a better job.
And of course, we've talked today about the local audit office and improving audit at the local level, which has been an absolutely shaming gap in recent years. And now at last, it will take time, but we can see real improvements on value for money. We have had a similar, really heart searching discussions about making best use of our capabilities in those areas. I think there's been an ever more strategic approach to the value for money studies we do. We're obviously very keen to ensure that the Public Accounts Committee has the reports that it needs and values from us, but I think what's been exciting is to see the development of more cross-government studies and whole system approaches.
I was particularly taken by the asylum report, which I think is a model for future systems that cross departmental boundaries and are quite difficult for government to track, but we can really be helpful in that respect. And our new studies, which we're just beginning to do, of particular initiatives of government departments, for example, the one on Ministry of Justice use of AI to ensure that the records that need to be produced in court are both present and correct, is a is a wonderful example of a very helpful tool, which I think will really benefit departments.
So I think I think in all of those areas, we've made real progress. And of course, there's now this new approach to the scrutiny of sensitive defence expenditure, which I think is a major step forward. So you asked me to speak about challenges for the future, and since we've already discussed them today, I can be very brief on those. One is clearly AI, where we are both determined both internally and in our audit of government departments and value for money studies, to watch both the potential of AI, but also the need for clear guardrails. I'm not saying anything original or new there, but it's both a vital tool, one that is completely with us, so impossible to ignore, but also has to be carefully managed and carefully observed.
Second, devolution, and we did speak at some length about this this afternoon is is huge potentially. And I think we can play a very helpful role, both in terms of the devolution framework, but also our work with the local audit office. Devolution won't work unless we can assess whether it is working. There will be huge questions about postcode lotteries and different outcomes in different parts of the country, but actually I think we are well placed to support the local audit office, as well as doing our own work to ensure that the parliamentary accountability is clear and well judged.
And finally, I suppose a personal plea from me is, is that I hope we are entering a slightly more stable period simply because some of the issues that we know are really important long term issues have been squeezed out by short term crises. And so the opportunity, I think, to use our expertise and our very good and strong strategy to move forward on important issues, whether it's climate change, food security, public health. There are so many areas. But taking a longer term view, social care is another I think is going to be really important. So that's my tuppenny worth as I approach the end of a job that I've really enjoyed.
I'm hugely grateful both to my board, but to Gareth and the executive team and in fact , to all the staff at the now, they are an amazing bunch of very committed, very bright, very dedicated people, and I think we're extremely lucky to have them working so hard to ensure that Parliament has the assurances that it needs. Thank you.
16:50
16:50