I beg to move, to leave out the Clause.
I do so, not because I desire to destroy the provisions as to audit in the Bill, but in order to draw attention to the very remarkable increase which is being sought by the Secretary of State for Scotland in his powers to audit the accounts of the big cities, and particularly of the City of Aberdeen, part of which I have the honour to represent. The situation at present is this, that the audit of Aberdeen is carried out under a Provisional Order of 1915. We have three auditors—not one, as stated by the Minister—who are appointed by the Secretary of State for Scotland.
§ The LORD ADVOCATE
The local Aberdeen newspaper said I said so, but the OFFICIAL REPORT said the contrary, and correctly. It was Dundee, not Aberdeen, that I spoke of.
I was under the impression that the Minister said it, but I apologise. The audit they make is quite satisfactory, and there is no complaint about it. No one has ever said that the accounts of Aberdeen are not well audited and that the whole city is not thriftily managed. Now comes along the Secretary of State for Scotland, and for no possible reason whatever proposes to co-ordinate or assimilate the management of the finances of the City of Aberdeen with a general scheme which has absolutely no application to our special case. I cannot conceive of the ground he has for doing so. He is, first of all, securing the right of surcharge and, further, the power to audit accounts which have nothing on earth to do with him. When this Bill has been passed, the expenditure of the City of Aberdeen will be about £1,600,000 a year, of which £1,500,000 will be money that is not grant-aided in any shape or form, and part of which will be the Common Good, which is even independent of the rating assessment. What justification can there be for the Secretary of State for Scotland to insist upon the right of audit and surcharge of these matters, which are no concern of his whatever, but purely the concern of the citizens of Aberdeen?
437 We are unlike a county council. Something might be said for altering the audit of county council acounts, but, so far as Aberdeen is concerned, we have, in addition to the ordinary county services, such trading departments as gas, electricity, water, tramways, parks, sewers, the Common Good, and our Art Gallery. What the citizens of Aberdeen say—and I am speaking with the authority of the Treasurer of the City—is, "Why should we surrender to the Secretary of State for Scotland and a Government Department—because that is what it means—these powers over matters with which they have no concern and to which they make no contribution from the Exchequer?" The present system is going on with complete satisfaction to the citizens of the city, and the change is proposed for no reason whatever by the Government, and I think it is the duty of the Lord Advocate, if he can, to give some reason for this much resented increase of bureaucratic powers in this and other cases.
§ The LORD ADVOCATE
The hon. Member for Aberdeen, North (Mr. Benn) has spoken entirely of Aberdeen. Our proposal is that the general code of audit should be applied right through Scotland to the local authorities. I said on the Committee stage that a distinction existed between county and burgh accounts. The accounts that are least like those of a county at present are those of the City of Glasgow, who, subject to the Amendments we have put down, are perfectly content to come under the code which is proposed, and who would have stronger reasons for objecting to it than the City of Aberdeen. I have seen the City of Aberdeen. I had an interview with them about something else, and they never said a word about the audits previous to my—
Since when have we had the new constitutional doctrine that the place in which to raise objections is in a public Department and not in the House of Commons?
§ The LORD ADVOCATE
The Report stage in the House of Commons is a little late for raising objections which are so strong and which have been so long felt, according to the hon. Member.
But is the Lord Advocate not perfectly aware that under the Guillotine it is impossible for Scotland to raise any objections?
§ The LORD ADVOCATE
No, I am not aware of it at all. The present state of Aberdeen is that, under its own Provisional Order, the appointment of auditors, whether there are to be one or more, is in the hands of the Secretary of State for Scotland, and, therefore, there is no change in that respect. I think the hon. Member will agree that the only substantial change, apart from the education accounts, will be the right of surcharge, and the general view is—and I spoke about this last time, and dealt with it in the House—that, generally speaking, the right of the ratepayers to inspect accounts and to take objection to them is not a satisfactory method of check, and that the right of surcharge is the more valuable method. That is founded on general experience, and I do not agree that this method of making effective the control of an auditor with regard to illegal expenditure is bureaucracy at all. It gives full opportunity for the defence of the alleged illegality, and I cannot see that anyone who has the public interest at heart can validly take any objection to it.
Aberdeen is getting grants. Public money is going to Aberdeen from the Exchequer in increased quantities, and through the grant going in the form of a pooled sum, on the one hand, the central authority does not require to maintain the same close supervision of the local authority as it used to have to do when grants were made for specific purposes. That is one of the advantages of the reforms proposed in this Bill, but surely the central Department is entitled to have some independent, separate check with regard generally to the question of expenditure, and that is done by the surcharge, both in the interests of the taxpayer and of the local ratepayer. I submit that when you find that the local authorities, the burghs generally, are quite content to accept this code, while, of course, every burgh is entitled to have its own opinion, there is nothing very outrageous, as the hon. Member suggested, in making a uniform code, as we have done in this Bill. I may say that the block grant to Aberdeen will amount to between £112,000 and £113,000.
§ The LORD ADVOCATE
What has the total expenditure to do with it? That is a very substantial sum, and it should entitle the central authority to have an adequate audit.
§ Mr. JAMES STEWART
The right hon. and learned Gentleman the Lord Advocate said, or it was said, not once but on several occasions throughout the Debate on this Bill and the Bill dealing with the same thing with regard to England, that one of the objects of the Measures was to give greater power and control to the local authorities and to take away from the central authority some of that control which they had exercised previously. [Interruption.] I know the Lord Advocate will bear with me in my lack of understanding, but that is what was said, but now we are being told the opposite. I am not disagreeing with it at all, but I want to point out what seems to me to be a contradiction. The local authorities were to get greater power and were to be less meddled with by the central authority, but now we are told that something of the opposite is to obtain and that greater powers will go to the central authority, of course, in the interests of the ratepayers.
§ Mr. STEWART
I have had some experience of illegal expenditure, and I know that what is illegal expenditure under one administration may become legal under another, or vice versa. That happens occasionally, according to the reasoning powers of the gentleman who happens to be Secretary of State or who has control for the moment.
§ Mr. STEPHEN
I would recall one point to the mind of the Lord Advocate, and that is that his own Government once had to ask this House to pass an Act of Parliament because of an administrative expenditure which had been incurred at the instance of the Scottish Office.
§ The LORD ADVOCATE indicated dissent.440
§ Mr. STEPHEN
The Lord Advocate shakes his head, but there was the case of the illegal expenditure incurred by the parish councils, and I myself thought that the administration was quite right in going on with that expenditure, but afterwards, when the Court, came to a decision on the matter, there had to be an Act of Parliament passed by this House, an Act of indemnity, in connection with that matter. I do not think the Lord Advocate ought to get away with it in that fashion. I believe, also, that from time to time similar circumstances have arisen in connection with health services, that is to say, that in view of the needs of the people the executive have decided to undertake expenditure for which there was no legal sanction and afterwards come to Parliament for an indemnity. Possibly the Lord Advocate is rather irritated because I have recalled this, thinking it may not be pertinent to this subject, but I am only quoting it as an illustration of what people who sit on the Treasury Bench may do. He has pooh-poohed our complaint and has spoken of "illegal expenditure" as though it were always a great crime. A local authority may be put into a position similar to that in which the Government have occasionally found themselves, and incur expenditure which is not strictly within their powers in the hope that the central Government may afterwards pass an Act of Parliament to indemnify them.
§ Amendment negatived.