Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 220-239)



  220. Why? Why did you want it?
  (Lord Cranbrook) We saw it as equitable that there should be no recriminations, no public discussions from either party that this should happen.

  221. On the basis of the questions I have asked I have been doing rough calculations. What I should like you to do is submit a piece of paper to the Committee giving more precise information than I have been able to calculate off the top of my head for each of the sub-headings so we can get some idea of what this episode cost you?
  (Lord Cranbrook) Yes.[7]


Mr Gardiner

  222. I should like you to answer Mr Williams' first question. Why did you not dismiss him?
  (Lord Cranbrook) We did not dismiss him because we did not go through the proper procedure. A disciplinary sub-committee was set up but that disciplinary sub-committee never met. We therefore had no ground to dismiss him.

  223. So you failed in your managerial role of conducting the correct disciplinary procedures.
  (Lord Cranbrook) Not at all. We were advancing the correct disciplinary procedures.

  224. Maybe I misheard you. I am sorry. I thought you said that you could not dismiss him because you set up a disciplinary committee which then did not meet.
  (Lord Cranbrook) Yes.

  225. Why did it not meet?
  (Lord Cranbrook) Because he chose to resign.[8]

  226. Was there not a case for not accepting his resignation but actually subjecting him to your disciplinary procedures?
  (Lord Cranbrook) The advice we received was that this would be of no advantage to either party and likely to be considerably more expensive than the solution which we achieved through mutual agreement.

  227. What really always gets me is the failure of organisations to apply disciplinary procedures. What you said is that it was of little advantage to either party. It was certainly a great advantage to him to walk off into the sunset without the criticism and without the opprobrium that a disciplinary committee would then have been able to put him through. Here you had somebody who was found to be in contempt of Parliament. You are saying that is not decent grounds to press a disciplinary case. Do you not feel you have a public obligation that this guy does not go into some other public organisation in a managerial capacity and then reap the sort of mayhem he did in your organisation?
  (Lord Cranbrook) Those words are quite unjustified and I should be very sorry indeed if anything I said could be taken to support those terms you have just used. I do not have it before me now, but there was a meeting of the Select Committee and that Select Committee recommended that no further action be taken on the contempt.

  228. Your committee which looked at disciplinary proceedings said that such proceedings should be initiated. You then set up the committee to take those disciplinary proceedings. Why did you back off.
  (Lord Cranbrook) For the reasons which I have already given you, which were justified in human and commercial terms.

  229. Whose human terms? Do you mean being nice to the man?
  (Lord Cranbrook) No. Neither party would have benefited from a long and open wrangle.

  230. Would the public have benefited from being able to find out what this guy had done that was, in the view of the committee you had set up, subject to a disciplinary proceeding?
  (Lord Cranbrook) What happened was a mutual breakdown of confidence. When that has happened, there is very little you can do in a business of any nature to restore a working relationship with the Chief Executive.

  231. You still fail to answer the question.
  (Lord Cranbrook) I think that does answer the question.

  232. No, with respect, it does not answer the question. The point here is that you had a procedure which recommended that disciplinary proceedings should be pursued. You then accepted the guy's resignation which meant that whilst it was probably going to work out about the same in cost, though perhaps slightly less in cost to you as an organisation, it did mean that somebody who could have been held accountable for their failings was not held accountable for their failings and there is a cost to the organisation from that, is there not?
  (Lord Cranbrook) Since the committee did not meet we cannot in any way prejudge the conclusions that the disciplinary investigation might have reached.

Jon Trickett

  233. I have been involved in large numbers of disciplinary actions. You tend to get the advice that Industrial Tribunals are slightly unpredictable in their outcome. I can understand that some money was possibly at risk in terms of you being represented at the Industrial Tribunal had it gone that far. Normally the advice I would receive from human relations people and legal people would be that this is an open and shut case or this guy has done wrong but he also has a grievance against the employer, therefore the thing is going to get messy in an Industrial Tribunal and it is best to close the case and settle for what you can. I am just wondering whether you received any advice that in some way you were vulnerable for treating him as an employee in ways in which he might be able to come back to you on. I ask that because you settled quickly. He did not resign and do a deal with you, that is quite clear. Then you asked him to sign a confidentiality clause not to make criticisms of the board or the company. That will worry the Committee. I am just wondering whether you can say as a matter of fact whether you received any such advice from any of your advisers.
  (Lord Cranbrook) The decisions were made at the board level. They were made always by the full board. The decision to enter into a confidentiality agreement was mutual. It would be wrong to say that it was something we insisted on initially. It was a mutual decision that the future prospects for Dr Sills would be best preserved by a decision of this nature.

  234. With respect, you have not answered the question. The question is quite simple really. Your company is a beneficiary from the confidentiality clause just as he is. You are both parties to it and he has agreed not to criticise you or to make his grievances against you public. We do not know what his grievances are and it occurs to me that it would be interesting to have him in front of us. What I am asking you is a very, very simple question. Did you receive advice from any of your advisers that you were vulnerable as a company or as an employer to any grievances which he may have against you.
  (Lord Cranbrook) The board did not receive advice of that nature.

  235. Or any advice at all other than the financial risk of going to an Industrial Tribunal which led you to agree to settle prior to disciplinary proceedings being launched.
  (Lord Cranbrook) The board consistently received advice from our legal adviser.

Mr Gardiner

  236. Was that written advice?
  (Lord Cranbrook) I could disclose the advice if you wish.

Jon Trickett

  237. Is it written advice which the Committee could see?
  (Lord Cranbrook) Yes.

Mr Rendel

  238. You keep saying things like "it was equitable that we should have a mutual agreement for confidentiality", "it was in his interests". Why were you taking his interests into account at this stage? If this was somebody you wanted to get rid of, why were you making a confidentiality agreement which favoured him?
  (Lord Cranbrook) I think you misinterpret the circumstances in so far as what occurred was a mutual breakdown of confidence and therefore both parties realised that there was no future.

  239. I can only repeat the question. Why did you do something which was benefiting him, if there was no future? You wanted to get rid of the guy, you were no longer interested in his future, you were interested in your company. It may well have been in the interests of your company to have full disclosure.
  (Lord Cranbrook) In the world of companies you do not just get rid of people. You have to go through the appropriate steps which are laid down in our company procedures. We had to have a disciplinary investigation before we could reach a conclusion that there would be grounds for dismissal.


7   Ev 26-28, Appendix 2. Back

8   Ev 26 and footnote 1, Appendix 2. Back

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