Estimates, 2001–02 (Hansard, 3 December 2002)

§ The Financial Secretary to the Treasury (Ruth Kelly)
I beg to move, That the limits on non-operating appropriations in aid set for the purposes of section 2 of the Government Resources and Accounts Act 2000 for the year that ended on 31st March 2002 be modified in accordance with HC 121. The purpose of the motion is to provide for the correction of an error in the Appropriation Act 2002. The annual Appropriation Act provides statutory authority for the spending plans of Departments as set out in their Supply estimates. Since 2001–02, the Supply estimates have been presented on a resource basis, and the Appropriation Acts, which cover various aspects of departmental spending over a three-year period, have been revised accordingly.
In authorising spending plans as set out in the supplementary estimates for 2001–02, however, the 2002 Act failed to reflect fully the move to resource estimates. The Act omitted the changes to non-operating appropriations-in-aid set out in those supplementary estimates. Details of the Departments and amounts involved are set out in HC121. The omission is in urgent need of correction. The 2001–02 accounts are in the process of being audited by the National Audit Office, which is signing off any departmental accounts affected by the error on the understanding that statutory authority to regularise the spending will be sought at the earliest opportunity. The procedures for drafting and checking the relevant draft legislation are being revised to help ensure that such an omission does not occur again.
I assure the House that there is no intention to provide new cash or resources for Departments. The purpose of the motion is simply to provide for the proper statutory authority for spending, as presented to Departments in their 2001–02 supplementary estimates and voted on by the House in the context of motions tabled on 11 December 2001 and 7 March 2002.

§ Peter Bottomley (Worthing, West)
Is the Minister essentially saying that this was a £3,000 million mistake?

§ Ruth Kelly
I am telling the House that non-operating appropriations-in-aid were not underpinned by the necessary statutory authority.
I commend the motion to the House.

§ Mr. Mark Prisk (Hertford and Stortford)
I begin by thanking the Financial Secretary for her statement, although I should say that it was as interesting for what was left out as for what was kept in.
Opposition Members recognise that, where errors of this nature arise, they need prompt correction, so we welcome the opportunity to debate these estimates without restriction to a particular hour. I shall of course not detain the House any more than is necessary, but quite whether my colleagues will wish to raise important supplementary questions is entirely a matter for them and for you, Mr. Deputy Speaker.
866 From what the Financial Secretary did say, it is clear that errors have arisen in both the drafting and the checking of the original legislation. Some may argue that the fault rests with the parliamentary draftsman or with the Clerks. However, I do not know whether that is true in this instance, because the relevant information was not provided in the ministerial statement. Whether it is true or not, the ultimate responsibility for Government business that passes through this House must rest with the sponsoring Department—in this case, the Treasury. So I do hope that the Financial Secretary will, in her reply to this debate—whenever that may take place—accept that final responsibility for these errors rests with her and with the Treasury, and not simply with the parliamentary draftsman or with the Clerks.
On first reading, the omissions in the current appropriations legislation may seem minor and obscure—particularly at this time of day—but they are in fact of considerable importance. They mean that the 2001–02 winter-spring supplementary estimates have, strictly speaking, no statutory authority. Thus any Government spending that has drawn on these estimates is, in effect, irregular and illegal. The omissions also mean that, at the moment, it would not be possible for the National Audit Office to finalise the Government's accounts for the past financial year, because of the irregular nature of the resources involved. Given these problems and their significance for the public finances, I should appreciate it if the Financial Secretary provided the House with some assurances.
Further to the Financial Secretary's opening remarks, can she confirm that this motion represents merely a correction in respect of the statutory authority, and that it does not represent any change in policy—which she did not mention—or in the amount of resources or cash allocated? Secondly, is she certain that the only Departments and Government agencies affected are those listed in appendix A to the motion, and can she confirm—despite her attempt to avoid the question from my hon. Friend the Member for Worthing, West (Peter Bottomley)—that the sum involved is indeed £3,000 million, roughly speaking? Is she also aware that appendix A appears to contain an error in respect of the figure allocated to the Department for Transport, Local Government and the Regions? Is that figure £2 and 6.8p, or is it in fact £2,068,154,000, as is printed in the document? I am afraid that the problems are beginning to pile up. The concern is the trustworthiness of the document before us. Given that its purpose is to correct an error in the first place, I hope that the Financial Secretary will treat the matter properly.
Thirdly, can the Financial Secretary confirm that these capital—or non-operating—resources include activities such as public-private partnerships and private finance initiative schemes, as well as other contracts with business suppliers? If so, what is the current legal status of those contracts? I ask that particular question because anyone in private business knows that they would face severe personal and regulatory penalties for entering into a commercial relationship without due authority.
Indeed, one of the criticisms of those behind the World Con and Enron scandals was that they entered into contracts when they did not have the appropriate money to do so. If the Minister is telling the House that Government Departments have bought goods and 867 services and have entered into contractual relationships backed only by resources that are irregular and illegal, many people—including business people—will want to know why. They will also want to know who in Government will take responsibility for the blunder.
I hope that the Financial Secretary will explain to the House the legal status of contracts backed by irregular resources, and whether there are any other financial or legal ramifications of the error of which the House should be advised.

§ Peter Bottomley
Will my hon. Friend ask the Financial Secretary to say, when she responds to the debate, whether the £2,000 million for the Department of Transport is disputed accountancy regarding the money to be provided to the successor to Railtrack, or whether that is still to come in some other supplementary estimate?

§ Mr. Prisk
I am grateful to my hon. Friend, who as usual asks a pertinent question. I am sure that the Financial Secretary will be only too pleased to answer it when her turn comes.
Six days ago, the Chancellor came to the House to present corrected borrowing and growth figures, having got his sums wrong earlier in the year. Today, the Financial Secretary has had to come to the House to correct legislation that has rendered some Government expenditure illegal and irregular. Opposition Members will support the prompt correction of any errors, and will not oppose the motion. However, we expect the Financial Secretary to acknowledge the importance of the error, and to accept her responsibilities and those of the Department. We also expect her to answer our questions in full, and to explain why the once trusted work of the Treasury has become unreliable.

§ Andrew Mackinlay (Thurrock)
You may have been in the Chamber some years ago, Mr. Deputy Speaker, when I told the First Lord of the Treasury that it was the duty of Labour Members to provide scrutiny and accountability, without fear or favour, and without showing partial affection. That is what I intend to do this evening. This matter deserves scrutiny. It raises an issue that hon. Members have neglected for far too long—our historic duty of voting Supply. We have abdicated that responsibility, but I think that it should be restored. This motion may give us an opportunity to canvass that proposition.
The error also shows that there has been sloppy administration and disregard for the House. In addition, I understand that even if we agree this motion we cannot escape the necessity of passing new primary legislation. I am not sure whether my hon. Friend the Financial Secretary or the Opposition Front-Bench spokesman covered that. I hope that my hon. Friend will confirm whether new primary legislation will be needed to correct the error.
The document in the possession of hon. Members states: The Appropriation Act 2002 did not include … the amounts, which it authorised to be applied … The absence of authorisation through the Appropriation Act 2002 means that departments' utilisation of any of those amounts to finance expenditure lacks statutory authority. 868 I took the opportunity during the Division to clarify the fact that the motion will get us through the crisis to which my hon. Friend the Financial Secretary referred and which probably involves the National Audit Office. However, my right hon. Friend the Leader of the House will probably have to make time available at some stage for new legislation to regularise the matter. The House is entitled to be told the whole truth, and nothing but the truth.
In my life I have been guilty of many things, one of them being that I have occasionally criticised the Government. To that, I say, "No surrender." However, there are also times when it is possible to speak in favour of the Government with great enthusiasm.
Informally, I indicated that I should like to catch your eye in this debate, Mr. Deputy Speaker. I can tell the House that the relationship between us is good, and you said that the motion was very narrowly drafted.
Indeed it is, but there are a lot of matters before us that I do not think the hon. Member for Hertford and Stortford (Mr. Prisk) has rumbled. I did not see in his hands documents HC 636 or HC 391. If I am wrong, I apologise unreservedly. I know that other people are exercised by this matter, because I can see that they have their copies.
In the Supply estimates on non-operating appropriations in aid, paragraph 3 states: Therefore, new authorisation is being sought from the House of Commons to appropriate the non-operating appropriations in aid contained in HC 391 and HC 636". I have them here. I do not wish to delay the House, but bearing in mind your strictures, Mr. Deputy Speaker, I think you will that confirm the documents are within the footprint of the debate.
Table 1.3 in both documents—dated February 2002 and December 2001—gives me an opportunity to speak proudly of the Government's achievements. I shall say why in summary, but I want to go into some detail. The table shows growth after growth in major essential public services voted for and provided by the Government. The No. 1 priority is giving everyone the chance, through education, training and work, to realise their full potential and thus build an inclusive and fair society. That was a key part of our manifesto. I had to check with my hon. Friend the Member for Norwich, North (Dr. Gibson) that we were talking in millions, but the new net provision is £19 million. Some £2,200 million is to go towards helping people without a job into work through the employment service. I hope that when I read the Official Report I will see the right number of noughts.

§ Peter Bottomley
On a point of order, Mr. Deputy Speaker. The hon. Gentleman is taking us through the consequences of paragraph 3. I draw your attention to paragraph 1, which states: The changes to the net cash requirements … were agreed to by the House of Commons in resolutions passed on 11 December 2001 and 7 March 2002. We seem to be going back to why those resolutions were passed. It may be worth asking whether we have to listen to the hon. Gentleman's every detail.

§ Mr. Deputy Speaker (Sir Alan Haselhurst)
The debate should relate to the proposed modifications and limits for non-operating appropriations-in-aid for the Departments set out in appendix A to HC 121 and to the circumstances that give rise to the need for new authorisation in the present Session. That is the narrowness of the debate on which I gave advice to the hon. Member for Thurrock (Andrew Mackinlay), and I hope that he will not try to drive a coach and horses through it by reciting things from the past.

§ Andrew Mackinlay
Absolutely not, but may I invite you to look at the second sentence of paragraph 3, Mr. Deputy Speaker? It is explicit that we are dealing with non-operating appropriations-in-aid contained in HC 391 and HC 636 and set out in appendix A. I did not print this; the House of Commons did. HC 391 and HC 636 are, I think, within the footprint of the debate.

§ Mr. Deputy Speaker
I must advise the hon. Gentleman that we are debating the circumstances that have necessitated this motion coming before the House tonight. We cannot reopen issues that were discussed and agreed by the House in the past.

§ Andrew Mackinlay
I understood the Minister to say that they were not agreed. She said that unless we have this authorisation, the Government will be on skid row, or on the ropes with the auditors. I think that the Official Reportwill show that that is so.

§ Mr. Deputy Speaker
Order. We cannot have a rehearsal of the policy behind the various items on which the hon. Gentleman has sought to embark. We are discussing the technical matter of making the correction and the circumstances that have led to it. I really hope that he will take my advice on this.

§ Andrew Mackinlay
I think that I am in order, Mr. Deputy Speaker; the document makes it clear. I do not think that your ruling excludes us from referring to the contents of HC 391 and HC 636—although I shall not do so.

§ Peter Bottomley
If the hon. Gentleman will allow —

§ Andrew Mackinlay
The hon. Gentleman is not Speaker yet. I have a better hope than him—and more chance.

§ Peter Bottomley
Will the hon. Gentleman look at the verb in the penultimate line of the first paragraph of the document that we are discussing? He questions whether the House of Commons agreed the changes. That paragraph states clearly that they were agreed.

§ Andrew Mackinlay
But the hon. Gentleman will see that the first word of the next paragraph is "However" and that the paragraph continues: final Parliamentary approval for appropriations in aid is given through an Appropriation Act. The Appropriation Act 2002 did not include … the amounts. 870 That is why we are discussing the matter tonight, and that is why HC 636 and HC 391 are fully within the footprint of legitimate discussion—irritating though that must be. I hope that I have convinced you, Mr. Deputy Speaker, because —

§ Mr. Deputy Speaker
Order. What I am saying to the hon. Gentleman is that he may refer to a document but he cannot go over the ground in detail and embark on a recital, as he appeared to be doing, of the various reasons behind it. We are on narrower ground than that.

§ Andrew Mackinlay
I should not go into detail, because that would involve listing Labour's achievements, and to do that would take us beyond the relevant time tomorrow and we should lose a day's business. I should not do that.
The document relates to public expenditure growth in every key area. That has not been made clear enough. I referred to the Department for Work and Pensions and to the Home Office, where the increased agenda for combating crime is making places safer, improving the Prison Service and helping the Treasury solicitor to bring people to book.
It seems to me that we are entitled to examine every item of expenditure, because previous Parliaments abdicated their responsibility to do that and because the House to which we were elected has not—to our shame—set up adequate machinery for us to conduct that line-by-line scrutiny. The document deals with what is called virement in local government, and that should be the primary purpose of the House of Commons. It was in the past, and it should be so again.
Obviously, Mr. Deputy Speaker, I am persuaded by the force of your argument and by the authority of the Chair, but it is important that on some occasions we should look at things in detail. I am bewildered. Why on earth were HC 636 and HC 391 printed if not for us to study? However, there is a lack of procedures for virement and for line-by-line scrutiny of such things. Those documents give detailed breakdowns for every Department.
I should like to go through the Government's great achievements, but as you have asked me not to, Mr. Deputy Speaker, I shall leapfrog over several pages to demonstrate that I would abuse neither your patience nor the time of the House. The last page of table 1.3 in HC 391 details "Peers' expenses and administration", about which we should perhaps he concerned, as there has been an increase of £74 million.

§ Dr. Ian Gibson (Norwich, North)
What a waste of public money.

§ Andrew Mackinlay
I agree with my hon. Friend.

§ Peter Bottomley
On a point of order, Mr. Deputy Speaker. I think that the hon. Gentleman is talking about recurrent expenditure and not non-operating appropriations.

§ Mr. Deputy Speaker
I advise the hon. Member for Thurrock (Andrew Mackinlay) that we should stick to appropriations-in-aid

§ Andrew Mackinlay
In that case, we should receive a fuller explanation from Members on the Treasury 871 Bench as to precisely what the appropriations-in-aid are. A simple explanatory document in plain English could have been produced for people who are not necessarily au fait with the details of the estimates — not only for humble Members of Parliament such as me but also for people outside. They would then have been able to understand the reason for the debate, because there has not been an adequate explanation.
We should be proclaiming the amount of expenditure; we should not be ashamed of it. I cannot understand why the Government are ashamed of the measures that we are endorsing, or authorising, or giving authority to, tonight. Why are we so shy about it? We all make mistakes sometimes. The Minister could have got the mistake over quickly, beaten her breast three times and said, "This is something that we are proud of, and we should proclaim it from the Dispatch Box," because we could be told about all these achievements.
Having made the point, I would hope that Treasury Ministers and the House authorities will not simply avoid a repetition of this occurrence but will reflect on how the House can in future give a critical examination of the estimates in general, and of any variations for the remedy of any procedural error that does occur; because otherwise, it seems to me, we just reinforce the charade of this House of Commons rubber-stamping tablets of stone handed down by the Executive of the day, which I am not prepared to acquiesce in any longer.

§ Mr. David Laws (Yeovil)
Given the late hour, and the Financial Secretary's charming apology—I think that it was an apology, however short—it is tempting to nod through this error involving £3 billion of Government expenditure and laugh it off as an administrative error which we should not spend too much time on.
However, the mistake, and the speech by the hon. Member for Thurrock (Andrew Mackinlay), highlight the fact that there are some very substantive issues that the Government need to address, which cast light on the way in which the House scrutinises—or perhaps on many occasions fails to scrutinize — the expenditure side of the Government accounts. That for me was highlighted when I rang the Library earlier today to establish what this evening's debate was about.
The Library faxed through to me the very brief description that the Financial Secretary gave us about the substance of the debate. When a series of simple questions were then asked about what the sums of money consisted of, and what the causes of some of the errors were, the Library could not tell us the answers. It therefore telephoned the Treasury, and spoke to its contact for the Treasury officials to establish what these amounts were and what they related to, and to ask some basic questions about them—whether they were net or gross, and which Departments they related to specifically. I am afraid to say that the Treasury message that came back was that both the Treasury officials and the Library were uncertain about some of these answers, and that perhaps they were issues that we should raise in the debate. When we reach the stage when not only the Library but the Treasury officials are uncertain about what we are being asked to approve, it is incumbent on the House to scrutinise very carefully what the Government are putting before us.
872 May I therefore ask the Financial Secretary some specific points about the comments that she made at the beginning? First, can she give us some more detail about why that £3 billion of expenditure has been mislaid for a time in the Government's accounts? Who made the error and why was it not picked up? Is there no system of checks within the Treasury that would be expected to pick up errors of this type? Was the error a consequence of the shift to resource accounting and budgeting, or was it a consequence of some other error in the Department?
Secondly, as the hon. Members for Thurrock and for Hertford and Stortford (Mr. Prisk) asked in their speeches, what exactly are the amounts that have been put before us today? It suggests a certain amount of carelessness when the largest figure on the table before us, which we assume is £2,068,154,000 for what was then the Department for Transport, Local Government and the Regions, is not even denominated correctly, so we cannot establish whether that is the precise sum. But what are these sums?
There are quite a variety of them, from that £2,068,154,000 for the DTLR all the way down to smaller sums, such as £76,000 for the Department of Trade and Industry. What exactly are those amounts? Can the Financial Secretary tell us what underlies those very large figures, which she expects us to scrutinise and approve tonight?

§ Michael Fabricant (Lichfield)
The hon. Gentleman is making a very powerful point. I am looking at the figure for the DTLR and it clearly states—this may be a misprint—"2.068,154,000". That is extraordinary. There are commas and a delineating point. What is the figure? Are we talking about trillions or billions? Given that the Treasury presumably has a computer that works, is it not extraordinary that we are discussing the fact that the Government have made a mistake with £3 billion of taxpayers' money?

§ Mr. Laws
The hon. Gentleman makes a powerful point, as ever. I am not sure whether I agree that the sum is a trillion. I did not read the figure in that way, but it certainly denotes a certain carelessness when the Government have to return to the House to clarify whether £3 billion of expenditure has been lost, but then cannot even get the digits right.

§ David Taylor (North-West Leicestershire)
Does not this whole saga highlight the appalling degree of innumeracy that often exists at the highest levels of Government? This is a nation of 60 million people that spends £420 billion—approximately £7,000 per head, on average—but that expenditure is subject to much less scrutiny than that of a parish of 600, which spends £4,200 at £7 per head. Have we not got the telescope the wrong way round in this country?

§ Mr. Laws
The hon. Gentleman makes a powerful point, which supports the position taken by the hon. Member for Thurrock. I hope to make a few more comments about that matter in a minute, but perhaps the Financial Secretary can clarify what the amounts are. We know that they are likely to represent capital expenditure, but what do they relate to? Why is the amount for the DTLR so large? Are these net payments 873 and receipts, or are they the gross amounts that have been paid? Does the fact that officials and Ministers are discussing these matters as we speak suggest that some of those exceptionally basic questions are not in the forefront of Treasury Ministers' minds?

§ Mr. Mark Hoban (Fareham)
The hon. Gentleman asks whether the amounts are net or gross, and whether they are receipts or payments. That is not entirely clear because the Department for International Development has a negative figure of £6 million. What on earth are we talking about—expenditure, receipts or both? The Government have not been entirely straightforward in explaining this matter to us.

§ Mr. Laws
That is another powerful point—[Interruption.] Very powerful points are being made by hon. Members on both sides of the House.
We do not know precisely what the figures are. We suspect that the negative amounts are capital receipts, but perhaps the Financial Secretary will clarify that. We do not know whether they have been netted off against capital payments. We look forward to the Financial Secretary's enlightening us on that later in the debate, because we certainly will not want to approve the estimates unless we know what they are.
Can the Financial Secretary also clarify whether the amounts have been spent and received already? Are we being asked for retrospective permission for expenditure and receipts that have already been given effect, or is the House being consulted in advance of any of these payments and expenditure being approved? What checks will be put in place in future to ensure that such errors are not repeated?
A number of Members have commented on the attitude of the House of Commons to the expenditure issues underlying this debate. That raises a wider issue that is directly relevant to the debate and to the way in which the House holds the Government to account for expenditure. To many of us, it seems that we still have a medieval system in this country in terms of the scrutiny of Government expenditure and receipts. We still act as if we were a Parliament in the 13th, 14th or 15th century being asked simply to approve revenue raising by a monarch, and being unconcerned about how the monarch spends that money once it is raised. We spend time on scrutinising the tax elements of the Budget, and sometimes we do not approve of them, but we have no record of scrutinising expenditure measures as many other legislatures throughout the world do.
The Select Committee on Procedure commented on that in 1981, when it produced a report saying: parliamentary control of government expenditure is a myth". The Committee supported that in 1997–98 by saying: if … not a constitutional myth, it is very close to one". You may be aware, Mr. Deputy Speaker, that over the last year my hon. Friend the Member for Kingston and Surbiton (Mr. Davey) has made similar points and expressed similar concerns about the lack of scrutiny of expenditure in this place. He has pointed out in a number of debates that the last occasion when the House turned down a request from Ministers for cash 874 was in 1919, when the then Lord Chancellor was denied the funding for a second bathroom. That highlights the appalling lack of scrutiny of Government expenditure, which will rise, including these specific measures, to some £511 billion by the end of this expenditure review period.
The Government therefore have two major questions to answer tonight. First, as the hon. Member for Thurrock asked: what will they do to improve scrutiny of expenditure in the future, to make such errors less likely to occur by having a proper debate in this place, and to give the House power to scrutinise expenditure, to suggest increases in expenditure and to suggest changes to expenditure priorities? All those measures are available in other legislatures across the world, but not in this House. Those scrutiny measures relate directly to this debate, as, if we had such scrutiny, we would be less likely to vote through measures that miss out £3 billion worth of Government expenditure. Secondly, will the Financial Secretary respond to the detailed questions that I posed at the beginning of my comments about what the expenditure is, and the safeguards in the future? Unless we receive a persuasive response to both questions, we will be obliged to object to the estimates being approved.

§ Mr. Edward Leigh (Gainsborough)
I should like to return to the motion. I wish that I could agree with the hon. Member for Thurrock (Andrew Mackinlay) that high constitutional matters are at stake, but perhaps I can give a simple explanation. I am not sure that it is my job to ride to the aid of the Government, but in the interests of fairness, it is my duty as Chairman of the Public Accounts Committee to explain to the House what has happened.
The need for the motion has arisen, as the Financial Secretary has told us, because of the omission, in error, of details of non-operating appropriations-in-aid from the relevant schedules to the Appropriation Act 2002. The omission arose from an administrative error on the part of the Clerk of Supply, which was not spotted by the Treasury when it checked the Bill. There may, therefore, be some fault inside the Treasury, which we may need to examine in future. I very much doubt, however, that that fault went all the way up to Ministers—I would be surprised if it did.
The error was caused by changes made to the form of the Appropriation Act 2002 that resulted from the change to resource-based Supply. You may know, Mr. Deputy Speaker, that we are changing all Government accounts over to resource accounting and that has caused difficulties for Departments.

§ Michael Fabricant
Will my hon. Friend give way?

§ Mr. Leigh
I shall carry on for the moment, as I am anxious to explain these matters calmly.
I have spoken today to the Clerk of the Public Accounts Committee, the National Audit Office and the directors responsible and, in my view, the error is not in any way attributable to the Government, but the motion is necessary to rectify the situation. Appropriations-in-aid are revenues that Departments generate and that they are authorised to retain to finance expenditures 875 over and above those financed from the consolidated fund. In other words and to explain it simply, if they have sold land, for instance, and want to keep the money in the Department, they can do so. The omission of references to these amounts in the Appropriation Act 2002 meant that the utilisation of these amounts had no statutory backing. That is why the motion is before us.
However, to be fair to the Government, it is important to note that the relevant information was laid before Parliament in the winter and spring supplementary estimates, voted on and approved. I do not think that anything has been kept back from the House of Commons, and I say that because I would not like the House, which should treat estimates seriously, to think that it has been kept in the dark.
The National Audit Office has been in discussion with the Clerk of Supply and the Treasury on the most appropriate way to give statutory backing to these amounts and so that the administrative error can be righted. The motion seeks to achieve that goal. I have discussed it with the National Audit Office and it has asked me to say that it has sought action to be taken as swiftly as possible because many departmental resource accounts are affected and are in the process of being finalised. In the meantime and in anticipation of the action that I hope that we shall take tonight, it has agreed for additional disclosure to be included in the accounts of the affected Departments. On that basis alone, it is comfortable that there is no need to qualify the accounts of the Departments.
In summary, it is the view of the National Audit Office that this motion is an appropriate course of action to rectify the effects of an administrative error by the Clerk of Supply. In fairness to him, he has written a memorandum to my Committee and I see no reason not to read it out. He says: I am extremely sorry that a mistake in the preparation of this Consolidated Fund (Appropriation) Bill for which I am responsible as Clerk of Supply has caused considerable inconvenience to the House of Commons, to the National Audit Office and to Government Departments. That is a very generous apology. We should leave the matter there.

§ Peter Bottomley (Worthing, West)
I am glad that my hon. Friend the Member for Gainsborough (Mr. Leigh) spoke in the way that he did. It is clear that we are not dealing with the general question of whether the House should approve line by line every part of Government expenditure. If that were the proposal before us, I would oppose it, because Members of Parliament and groups of Members of Parliament would go in for the type of pork-barrel politics that is not one of the greatest features of the American system. The fact that we can argue for our constituents' or other interests is important, but line-by-line approval of spending is not necessarily, on balance, a good thing.
The hon. Member for Thurrock (Andrew Mackinlay) has probably found his way into a dictionary of quotations when he talked of rubber stamping tablets of stone. That expression will be remembered — especially if I have anything to do with it.
876 The Financial Secretary moved the motion properly. The combination of what she and my hon. Friend the Member for Gainsborough said spelled the position out clearly. Even from the limited notes in appendix A, it is clear what happened. The House knew what it was doing, and the Financial Secretary has spelled out that there will be no extra spending. The only point that I wish to add is to ask whether it is possible to find a better expression than non-operating appropriations. If it is not capital spending or capital receipts, what is it? To say what it is not does not tell us what it is. I hope that the plain English campaign in the Treasury will deal with that point.

§ Andrew Mackinlay
I accept what the hon. Member for Gainsborough (Mr. Leigh) said. However, a serious point is involved. My hon. Friend the Financial Secretary could have said the same thing and/or it could have been made clear in an explanatory memorandum. If we had been given the logical explanation, we would have avoided much understanding. The title of the document does not mean anything to anyone; it is gobbledygook.

§ Peter Bottomley
I agree that the debate is useful because things should not pass through the House without hon. Members understanding what is happening. The Minister should be congratulated, however, because it was better to hear the full explanation from my hon. Friend the Member for Gainsborough (Mr. Leigh), who is Chairman of the Public Accounts Committee. That courtesy to the House is appreciated.

§ Michael Fabricant (Lichfield)
I welcome the brief opportunity to speak. I thank my hon. Friend the Member for Gainsborough (Mr. Leigh) for clarifying the situation. We often receive estimates for billions of pounds, which is not our money, but taxpayers' money, that we rubber stamp with little understanding of what we are agreeing to, as the hon. Member for Thurrock (Andrew Mackinlay) said.
I understand that the problem was due to an accounting error because of the Government Resource and Accounts Act 2000, which sets out the new Treasury accounting procedures. Will this be the last time that the Minister comes to the House to ask for an amendment to be made because of an accounting error? I accept that it may not be, and we need to understand the situation fully.
I disagree ever so slightly with the hon. Member for Yeovil (Mr. Laws). Although I was not in the Chamber, I listened to the Minister and am not altogether sure that she apologised. Although I do not think for one moment that she is personally responsible, or even that her officials are responsible, at the end of the day we are discussing £3 billion of taxpayers' money. There are many reasons why hon. Members are sent to the House. One of them is to look after taxpayers' money and how it is spent.

§ Peter Bottomley
The sense of my hon. Friend's comments may be right, but I suspect that we should pay 877 attention to the fact that the error was made in the House. I am pretty certain that it was detected in the Treasury.

§ Michael Fabricant
That is reassuring, but the appropriation is generated from a Treasury motion. I am sure that the Minister will confirm that. To echo what my hon. Friend said, I, too, am grateful that the Chairman of the Public Accounts Committee set the record straight. But why should my hon. Friend the Member for Gainsborough be the patsy? Surely the Minister should have explained the problem fully. As the hon. Member for Thurrock said, there should have been a clearer explanation on the Order Paper and in connection with Command Paper 121. It is not clear what precise moneys we are talking about and how the situation arose.
This is a brief but important debate. I reiterate that we are talking about £3 billion of taxpayers' money. Although the money was not lost, we have to account for it, and it is right and proper that it be debated. I hope that the Minister will reassure us that the problem will not happen again.

§ Ruth Kelly
With the permission of the House, I thank hon. Members for their commendable interest in the debate. I want to pay a special tribute to the hon. Members for Gainsborough (Mr. Leigh), the Chairman of the Public Accounts Committee, and for Worthing, West (Peter Bottomley). They brought great experience and maturity to the debate. Much as I enjoyed the other contributions, especially by my hon. Friend the Member for Thurrock (Andrew Mackinlay), the hon. Member for Gainsborough in particular set out in detail why the motion has been tabled.
I was not aware of the letter of apology by the Clerk of Supply. I agree with the hon. Gentleman that it is a very generous apology, and the House should recognise that.
I accept responsibility for the fact that the matter was not picked up during he Treasury's checking procedure. The Treasury was the first Department to notice the error, but clearly it did so after the event rather than before the original votes had taken place. Procedures will, of course, be tightened up, and I am sure that much more attention will be paid to such issues in future.
This particular issue arose, as the hon. Gentleman set out so clearly, because 2001–02 was the first year of the resource estimates, and the Appropriation Act 2002 failed to reflect the changes required. Under cash-based supply there was only one type of appropriation-in-aid, whereas under resource supply we have operating, relating to resource income, and non-operating, relating to capital income, appropriations-in-aid. The 2002 Act included authority only for the operating appropriations in aid. The National Audit Office, although concerned about the lack of statutory underpinning, has accepted the income and expenditure in the accounts that were presented on the basis that the 878 problem resulted from an administrative error, that Parliament has had the estimates laid before it and that it has voted on them.

§ Dr. Gibson
On a point of clarification, may I take it that the letter of apology was sent not to the Minister but to the Chairman of a Select Committee?

§ Ruth Kelly
I cannot answer as to whom the letter was written, but it has not yet found its way to my desk. It may well have been written to the hon. Member for Gainsborough.

§ Mr. Leigh
The letter is a memorandum submitted by the Clerk of Supply of the Public Bill Office of the House of Commons, and was sent to the Clerk of my Committee. I have read out the apology, and I think that we should pay tribute to a servant of the House who has made an honest mistake and who has now apologised for it.

§ Ruth Kelly
I completely agree with the hon. Gentleman, as I am sure the House does. The motion in no way provides the Government with any additional spending authority. It simply provides for the correction of that regrettable administrative error.

§ Mr. Prisk
The hon. Lady said that, in these circumstances, the NAO is prepared to accept the accounts as long as matters progress. However, she did not say that, at the moment, the NAO cannot finalise the accounts, so without this change the Government's accounts for the last financial year cannot be completed. Will she confirm that?

§ Ruth Kelly
The NAO is signing off departmental accounts, and it has signed off some on the understanding that legislative authority is to be urgently sought because it is needed to regularise the position.

§ Mr. Andrew Mitchell (Sutton Coldfield)
The hon. Lady made that point in her opening remarks, when she said that the NAO was signing off accounts even though it does not have the authorisation to do so. Is it common for the NAO to do that? If a private company were to behave in that way towards a company's accounts, it would rightly be prosecuted. Call me old-fashioned, but that seems to me to be rather an important point.

§ Ruth Kelly
As the hon. Gentleman is well aware, most private companies do not have the opportunity to have their accounts agreed and voted on by Members of this House.
Clearly the position needs to be regularised; that is the NAO's approach, and I intend to rectify the matter through this motion.

§ Michael Fabricant
Will the hon. Lady give way?

§ Ruth Kelly
I shall give way one last time, but after that I must not detain the House much longer.

§ Michael Fabricant
I just want to repeat the question that I asked when I made my small contribution. Can the Minister now assure us that she has, as she puts it, 879 regularised the position not only today, but for future years? Will she confirm that this error arising from the change in accounting practice will not happen again next year?

§ Ruth Kelly
As I have explained to the House, this was the result of a one-off change from cash accounting to resource accounting. Clearly I cannot guarantee that no drafting errors will occur in future. I would not like to commit myself to anything of the sort, even under such intense pressure.
However, the House should agree that we should resolve that issue today. Departments' spending, including the retention of income, must be regularised at the earliest opportunity. The motion paves the way for that process and will allow the 2001–02 resource accounts to be completed in accordance wit h legislative requirements. For those reasons, I commend the motion to the House.

§ Mr. Deputy Speaker
I think the Ayes have it.

Hon. Members
No.