Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 180-199)



  180. We are talking about the process of disciplinary hearings, disciplinary procedures, that is what we are talking about.
  (Mr Tebbit) Secondly, the NAO did not, I think, go about the job of trying to amass a body of prosecution evidence. This was not conducted as an investigation into the behaviour of staff with a view to discipline and prosecution. It was conducted as a way of trying to establish best practice and how to improve our methods.

  181. Indeed.
  (Mr Tebbit) I have no view myself about the quality of this information in terms of whether this was serious disregard for the regulations or that the individuals concerned thought that they knew better and had other factors in mind. This certainly would not have been the basis for a formal disciplinary charge and the NAO did not come to us and say "These people have been guilty of maladministration". This is part of a value for money best practice study which we are using to improve our processes, not to conduct witch hunts.

  182. I am sorry, I cannot let you get away with that. Decent personnel practices are not witch hunts. Decent personnel practices see when things have gone wrong and they then follow it through with capability or disciplinary procedures.
  (Mr Tebbit) That is what we are doing.

  183. It is not a witch hunt.
  (Mr Tebbit) We have used this in order to completely revise our procedures and processes. We have been trying to describe the mass of action we have in train to do exactly that.

  184. We seem to be on different planets.
  (Mr Tebbit) We may well be.

  185. I accept what you say, that this is a report carried out in co-operation with the NAO to establish ways of improving practice.
  (Mr Tebbit) Yes.

  186. And in many respects, from what you have said this afternoon, it has been successful in doing that.
  (Mr Tebbit) Indeed it has.

  187. That was why at the beginning of this afternoon I thought that we were not going to be able to find much in here to change what you are doing, but the thing that seems to me to have come out from this afternoon above all is despite the fact that you had seen that there was bad practice going on, and in your words "certain managers simply abrogated their responsibility", there have been no cases where then, having established that certain managers had abrogated their responsibility, they were disciplined for so doing.
  (Mr Tebbit) That is correct.

  188. Why not?
  (Mr Tebbit) Because, as I have said before, this was not conducted in the form which would give me the reason to discipline an individual.

  189. Answer me this question, please—
  (Mr Tebbit) I am sure if the NAO had found evidence that was the case they would have reported it to us.

  190. Given that this is not a basis for disciplinary procedure, what subsequent investigations have you made into the practices of those managers to establish whether disciplinary procedures should be started, or capability procedures should be started, against such managers who abrogated their responsibility?
  (Mr Tebbit) The report was based on examination of three particular establishments. We went to those establishments subsequent to the report and checked and carried out our own inspections of whether procedures were being implemented properly, whether there was an improvement, and there was an improvement. We went back again after that and involved the line managers at the highest level in those areas to ensure that everything was absolutely correct, and I can now confirm that these things have indeed been put right.

  191. Can you confirm, therefore, the level of estimates now being taken?
  (Mr Tebbit) In these establishments, yes. This was based on looking at three particular establishments.

  192. What you are telling me is that prospectively you have sorted things out but what you are not doing is saying that retrospectively you have disciplined those managers who failed in their duty, and that is what I find so worrying. If you have a culture within the organisation that fails to discipline people who do not do their duty then that goes absolutely counter to your own statement on anti-fraud.
  (Mr Tebbit) There was never any question that the individuals were guilty of fraud.

  193. Indeed there was not.
  (Mr Tebbit) I have to make that absolutely clear because we are talking about three specific establishments.

  194. It was the point I made at the beginning when I referred you to paragraph 1.3, I accept that.
  (Mr Tebbit) Perhaps it was my fault for introducing an emotive atmosphere using the word "witch hunt", and I did not mean to do that in a considered way. What I am really pointing out is that we use this to improve procedures and practice and explicitly have done so at these three establishments. We did not use it to discipline people, as it were, in a negative sense. I am satisfied that the thing has been put right. One has a choice: was it such a terrible thing which required discipline or was it something which required people to smarten up their act, and in this case that is what we have done.

  195. I am pushing time here. Could you just clarify that at RAF Wittering the subcontractor who charged accredited staff rates for non-accredited staff is still being used as a subcontractor? Paragraph 2.22.
  (Mr Tebbit) It is certainly not being done now because we have had a clean bill of health from that establishment[6].

  196. That was not what I asked. With respect, what I asked was is that subcontractor, who charged accredited staff rates for non-accredited staff, for doing electrical work I believe it was, still employed by you?
  (Mr Andrews) I do not think we can answer that.

  197. Could we have a note to the Committee because it is important in line with your statement on sharp practices and dishonest, illegal activity, saying that you are going to pursue all irregularity, fraud, theft.
  (Mr Tebbit) That is a very fair point. I will give you an answer. I did look into this and I did get an answer but I cannot be absolutely certain whether it is that we dropped them deliberately or they are no longer working for us. I need to check that[7].

  198. I have to be very brief because I am going to run up against the buffers in a moment, I know the Chairman is looking to pull the noose tight. Simply this though, you are moving over to prime contracting.
  (Mr Tebbit) Yes.

  199. One of the things that local government—and I do echo the words of Mr Davidson—has found is that contracts can be extremely difficult to specify in advance and extremely tough to monitor and enforce afterwards and it is something this Committee is very familiar with. Why do you believe that when things were actually broken, and yet nobody made an estimate of their costs, that you are going to have a better chance of incorporating estimates of all the costs of the things that might break but are not actually broken into a contract in advance?
  (Mr Tebbit) Well, we cannot obviously expect to get everything precisely right but there will at least be an agreement between us and the prime contractor and his supply chain about what the position is. There will then be the operation of the integrated project team with our people there with the prime contractor able to look at performance against the targets and the assumed costs as we go along. There will be the possibility to revise prices upwards or downwards along the way but since we will be using open book accounting, if we do revise them it will be on the basis of a genuine agreed requirement to change rather than sharp practice or anything else. The principle of gain sharing will mean that the contractor is incentivised for the first time really to drive down his own costs and ensure that the benefit of the doubt in these assumptions is always working to both of our own advantages rather than to something which he keeps to himself.

6   Note by Witness: See Evidence, Appendix 1, pages 25 to 26 (PAC 00-01/169). Back

7   Note by Witness: See Evidence, Appendix 1, pages 25 to 26 (PAC 00-01/169). Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2001
Prepared 12 September 2001