Select Committee on Environmental Audit Minutes of Evidence

Environmental Monitoring of Government—The Case for an Environmental Auditor, by Kathryn Hollingsworth, Lecturer in Law, Cardiff Law School


  The article argues that despite the limitations of audit highlighted in accountancy literature, audit can be a useful mechanism by which to hold government to account for the impact of its policies and operations on the environment ("environmental accountability"). However, as a model of accountability, the system of environmental audit established by the Government in November 1997 is inadequate. In making this argument, I will draw on two existing audit models. First, because the Government has chosen to model the Environmental Audit Committee on the Public Accounts Committee I will look at the mechanisms in place for securing financial and value for money accountability in UK central government. Second, I will look to the arrangements in Canada, where a more developed system of environmental audit exists and a Commissioner for the Environment and Sustainable Development has been established to audit government. On the basis of this analysis I will argue that the system for environmental accountability must be more closely aligned to the system of financial and value for money accountability. In particular, an environmental auditor must be established, with a role and constitutional framework which is best suited to securing environmental accountability.

UK Central Government Audits as a Model of Accountability

  The system of financial/value for money audit in UK central government works well, particularly since the reforms in 1983 which established the National Audit Office and put value for money audit on a statutory basis. There are three key aspects of the system which can be highlighted as being particularly important to this success. First, the independence of the main actors—the C&AG and NAO—from those they audit is secured. Second, there is a mechanism for reporting the outcome of the audit to a body which is also independent from those being audited, and which has the ability to call the auditee to account, namely, the PAC. Third, the system of central government audit, culminating in the PAC hearing, achieves the aims of both managerial and democratic accountability. These constitutional principles which underlie the system apply equally where other types of accountability are being sought through the use of audit, and specifically environmental audit. First though, it is useful to look in more detail at an established system of environmental audit, namely the Canadian Commissioner for the Environment and Sustainable Development.

The Canadian Commissioner for the Environment and Sustainable Development (CESD)

  The CESD was established by amending the Canadian Auditor General Act 1977 and is hence part of the Office of the Auditor General, rather than being a separate office. There are a number of advantages to this: first, the Commissioner has benefited from the status of, and high regard for, the Auditor General; second, the Commissioner was able to take advantage of a well established infrastructure; and third, issues of overlap between the Commissioner and Auditor General can be more easily resolved.

  The Commissioner assists the Auditor General in performing those duties that relate to the environment and sustainable development. These duties have been enhanced by including the environmental effects of spending in the list of issues on which the Auditor General can report to Parliament. In effect, the 3Es are now the 4Es (economy, efficiency, effectiveness and environment). In addition, following amendments in 1995, section 24 of the 1977 Act now requires departments to prepare sustainable development strategies. Thus, the Commissioner's role is fourfold:

    (i)  to make any examinations and inquiries that he feels are necessary to monitor the extent to which category I departments have met the objectives and implemented the plans set out in their sustainable development strategies:

    (ii)  to be responsible for the value for money audits which are primarily concerned with environmental issues;

    (iii)  to issue special reports;

    (iv)  to receive petitions from individuals on behalf of the Auditor General.


  At present, the EAC has the combined role of auditor and audience. However, as we have seen from our audit model above, these roles should be carried out by two separate bodies. An environmental auditor should be established, who is independent from the auditee (government) and the audience (EAC).

Role of the Environmental Auditor

  The development of an environmental audit role could take one of three forms: (i) a new and separate office of environmental auditor; (ii) an extended role for the current C&AG to include environmental audits; or (iii) a new environmental auditor who operates within the NAO on behalf of the C&AG. When assessing the relative strengths of these alternatives, the role of such an auditor must be considered.

  There are two aspects of the Canadian Commissioner's role which, in particular, a UK environmental auditor could have responsibility for—monitoring sustainable development strategies of departments (which obviously would require an obligation to be placed on departments to produce such strategies) and "environmental audits".

Sustainable Development Strategies

  Links between democratic and managerial accountability could be forged by the government producing guidance on what should be included in the sustainable development strategies, which could be developed in a document analogous to Government Accounting. A "green" Government Accounting could include the legal and non legal responsibilities for greening operations and policies, reporting and monitoring obligations and so on. Additionally, a senior civil servant could be responsible for achieving sustainable development in policies and for preparing the department's strategy.

Environmental Audits

  It would be within the Comptroller and Auditor General's (C&AG) current remit to carry out environmental audits as part of value for money (vfm) audits. However, this fails to place upon department's any duty to show that they have considered the environmental impact of policies or placed the environment into the vfm equation. Instead the environmental impact of programmes and projects should become the fourth "E" of vfm studies. Departments would thus be required to show that they had spent money with regard to economy, efficiency, effectiveness and the environment. These environmental audits should be carried out by a separate environmental auditor, and not the C&AG. This would have a number of advantages—it would increase the profile of environmental audit, and there would be a clear delineation between environmental audits and VFM audits and so the issue of which committee would have responsibility as audience (whether the PAC or EAC) would be more straightforward.

  Such an environmental auditor should be within the NAO rather than in a separate audit office. As in Canada, this would enable the auditor to benefit from the infrastructure and good reputation of the NAO, and there are already links between the NAO and the EAC. Again, as in Canada, issues of overlap which occur could be more easily resolved if that auditor operated within the NAO. Finally, placing an environmental auditor within the NAO is a model more likely to be accepted by the Government because it would not involve significant new expenditure nor radically alter the status quo. However, it is essential that the environmental auditor should be able to appoint his/her own staff.

  It is essential that the independence of the auditor is properly secured, and links between democratic and managerial accountability need to be forged (see full article for details). But it also needs to be recognised that an environmental auditor based on the Canadian model is not the only model of environmental accountability available. In New Zealand the environmental commissioner has more of an ombudsman role, and in Ontario, the Bill of Environmental Rights provides citizens with the necessary mechanisms to be able to hold government to account more effectively.

  But for central government, audit is a useful model of accountability for reasons which are both pragmatic and based on principle. Pragmatically, an audit model has been selected by this Government and it is arguably more useful to look at how this might be improved than to suggest an entirely new system. From a principled point of view, by extending the 3Es to the 4Es and monitoring policy decisions in this way, a holistic approach to decision making is instigated, ensuring that the environment is not a "bolt-on" but is considered an integral part of the decision making process. Environmental concerns may be given greater status within government if the system for securing accountability is comparable to the system for achieving financial accountability. And finally, if the system is modelled on the financial and vfm process it can help to combine managerial and democratic accountability, with each contributing to the effectiveness of the other.


Greening Government—The Role of the Environmental Audit Committee (forthcoming in the Journal of Environmental Law, OUP)[2] by Andrea Ross, University of Dundee


  In the White Paper A Better Quality of Life—a strategy for sustainable development in the UK, the Government observes that sustainable development requires cultural change and responsibility for this change must be shared among individuals, businesses, the private and public sectors.

  Determined to show the public sector leading by example, Labour Government has introduced a number of new initiatives designed to improve Government performance in the areas of environmental protection and sustainable development. These initiatives are aimed at "putting concern for the environment at the heart of Government policy-making" and are designed to promote the huge cultural change required to make sustainable development in the public sector a reality.

  The establishment on 10 November 1997 of the Environmental Audit Committee of the House of Commons ("EAC" or "the Committee") is one such initiative. EAC's mandate is threefold: to consider the extent to which the policies and programmes of government departments and non-departmental public bodies contribute to environmental protection and sustainable development; to audit their performance against such targets as may be set for them by Her Majesty's Ministers; and to report thereon to Parliament.

  This paper considers the effectiveness of the Committee at monitoring the environmental performance of government departments. More specifically, the paper assesses whether the EAC, during the parliamentary sessions 1997-98 and 1998-99, has met each part of its remit and what difficulties, if any, it is having in doing so. It relies heavily on the output of the Committee during the study period—namely its published reports and the government responses to the reports. The findings are then used to attempt some general observations about the Committee's influence on the extent to which the policies and programmes of government do in fact contribute to environmental protection and sustainable development.


Is the Environmental Audit Committee an Effective Form of Parliamentary Scrutiny?

  More specifically, has the Committee met the objectives set out in its remit? The EAC has interpreted its remit widely. Using this interpretation, the paper considers the EAC's remit under four different headings: the review of overall government policy and expenditure; the review of departmental policy and programmes; the audit of set targets and the reporting of its findings to the House.

1.  Review of overall government policy and expenditure

  The Committee has been very successful at examining the policies and programmes of government as a whole in terms of the extent to which they contribute to environmental protection and sustainable development. Every inquiry it has conducted has involved major policy issues. This has become the main focus of the EAC's work.

  The Committee has become an important monitor of the "integration process". From the start, it has taken the Government at its word, it has sought out policies and programmes which are not primarily environmental but which have a significant environmental dimension for its inquiries.

  For each of these inquiries, the Committee had a report or agreement to audit or review. If and when new information becomes available from individual departments and targets are set, it is likely that the Committee will begin more targeted inquiries. However, it is unlikely that this will herald the end of its large inquiries into major policies for three reasons. First, the Committee has been successful in its reviews of major policy issues thus far and success breeds success. Second, these reviews are appealing to members of the Committee since they cover important policy areas and attract more publicity to the work of the Committee and its goals. Finally, the Committee has expressly committed itself to several ongoing larger policy reviews.

2.  Review of departmental policies and programmes

  A narrower reading of its remit would require the EAC to review specific departmental policies, programmes and decisions (as well as those of NDPBs) in terms of their impact on sustainable development or environmental protection. The Committee has yet to conduct such an inquiry. The Committee did look at the policies of individual departments in its reviews of the Comprehensive Spending Review and the Greening Government Initiative. However, it has yet to direct any specific recommendation to an individual department. Instead, in both cases, the Committee used specific examples to make general observations and recommendations.

  The reasons for this are threefold. First, the Committee has not had the information it needs to conduct such inquiries. Departments have not systematically reported on their environmental performance in a way that can effectively be monitored. It is likely that as this information improves the Committee will ask specific departments to account for their actions more directly.

  Second, even if the information discussed above was available, the EAC has not been given the resources to conduct such detailed inquiries and its current structure could not deal with that volume of information effectively (in contrast to the Canadian approach).

  Finally, integrating sustainable development and environmental concerns into all aspects of government decision making is likely to require dramatic cultural change. It is possible that examining and criticising individual departments may be counter-productive to the integration goal at this early stage.

3.  Auditing against set targets

  The Committee has had virtually no opportunity to audit departmental performance against operational targets set by Ministers. The targets have simply not existed. The Committee has been instrumental in pressuring the Government to set targets and to ensure that those set are auditable. If and when targets are set, the Committee's audit function will likely become more significant. However, the Committee's current structure may have difficulty coping with a very detailed audit function.

4.  Reporting to the House

  The Committee has produced several very readable reports with useful executive summaries. All its reports show the Committee pushing the Government to keep its commitment to integration by criticising Government action, by providing support for the Government's position where necessary, by criticising those who disagree and by offering lots of recommendations. The reports are regularly referred to in the House and the press.

Influence of Committee

  The second question this paper sought to examine was whether the Committee has had an influence on the Government and the extent to which government policies and programmes contribute to environmental protection and sustainable development.

  It is nearly impossible to measure in any precise way the impact of select committees on government due to the variety of other factors which may influence government behaviour. That said, the study uncovered a great deal of evidence upon which subjective assumptions may be made about the Committee's influence on Whitehall and on the integration of environmental protection and sustainable development into the policies and programmes of government.

1.  Government statements

  The Government, at least in its rhetoric, claims that the Committee is an important part of the process of integrating sustainable development into government decision-making. These claims include statements made in the White Paper A Better Quality of Life, by Environment Minister in the Green Ministers Committee's Annual Report and by the Chancellor of the Exchequer in his 1999 Pre-Budget Report.

  To what extent this is simply the Government congratulating itself on coming up with the Committee in the first place is debatable. It does seem to suggest that the Committee is seen as something that cannot, nor should not be ignored.

2.  Reports

  This study has revealed several instances where recommendations in Committee reports have been accepted, and more have been placed under review.

  The reports also influence government by supporting policies and programmes which may be unpopular in certain quarters yet are consistent with sustainable development and environmental protection goals. The reports add legitimacy to the Government's position and make it easier for the Government to stick to often difficult decisions.

3.  Indirect indicators

  Preparing documentation for an inquiry, appearing before the Committee and writing responses may force officials to consider the environmental implications of departmental policies and programmes irrespective of how benign they may seem at first glance.

  The Committee's exposure can also be used as an indirect indication of its influence. The more exposure the Committee's work receives the more likely it will attract parliamentary and public attention. This, in turn, increases the likelihood the Government will have to respond or be seen to respond to it. The Committee's work is regularly referred to in the House. It has also received support from other environmental bodies, such as the Round Table on Sustainable Development. It has also received good coverage in specialist publications such as the ENDS Report and its work has had sporadic coverage in the generalist press. However, the EAC does not receive anywhere near the amount of parliamentary or press attention as the Public Accounts Committee and this could reflect their comparative influences on government, the House and the public.

1   See p. 67 for full article or Legal Studies Vol 20 No 2 June 2000. Back

2   See p. 53 for full article or Journal of Environmental Law Vol 12 No 2 (OUP 2000). Back

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