HC Deb 15 January 1998 vol 304 cc263-4W
Mr. Caplin

To ask the Secretary of State for Culture, Media and Sport what his plans are for the future management of the historic royal palaces; and if he will make a statement. [23684]

Mr. Chris Smith

The historic royal palaces are currently managed by an Executive Agency of my Department, which has progressively reduced its call on Exchequer support since its establishment in 1989. I have given careful consideration to ways of building on that performance and bringing an end to Exchequer support, while safeguarding the fabric of the Palaces and maintaining the quality of visitors' experience. I have concluded that these benefits will best be realised through establishing the historic royal Palaces as a Non-Departmental Public Body.

I therefore propose to apply for the grant by Her Majesty the Queen of a Charter establishing the new body and to seek Parliamentary approval of an Order under the Deregulation and Contracting Out Act 1994 to enter into a contract for it to carry out my day to day responsibilities for the management of the historic royal palaces. An application for charitable status will be made to the Charity Commission.

The new body would be established under a Board of Trustees to bring a wider range of expertise to the running of the historic royal palaces. I propose that the Board comprise three members appointed by Her Majesty the Queen and five appointed by me. The Chairman would be appointed by The Queen on my advice.

I can reassure the current staff of the Agency, who have done so much to secure its success, that their terms and conditions of service will be protected on their transfer to the new body. New pension arrangements, broadly comparable to those under the Principal Civil Service Pension Scheme, will be put in place. The Chief Executive of the Agency will now take forward discussions with staff representatives on the detailed implications of the proposed arrangements.

Exchequer funding is set to reduce to some £4 million in 1998–99, but I expect the new body to continue the Agency's success in increasing income and that its new status will give greater financial flexibility and open up fresh sources of income, so that the need for Exchequer funds can be brought rapidly to an end.

I should emphasise that the new arrangements would apply only to the historic royal palaces, which are currently managed by the Agency, and do not affect the palaces which remain in use and are managed on my behalf by the Royal Household. The changes would not alter the ownership of the historic royal palaces or my responsibility for their management. I shall remain answerable to Parliament for their care and presentation.

The new body would operate on the basis of an annual plan and agreed performance targets. The National Audit Office would continue to have full rights of access, both to carry out the annual audit of the accounts and to undertake value for money studies. Annual Reports and Accounts will be presented to Parliament and the Chief Executive will be liable to be summoned to appear before the Committee of Public Accounts and other Select Committees of this House.

Subject to the approvals to which I have referred, the new body would be established to take over the management of the historic royal palaces from 1 April this year.

The Historic Royal Palaces agency has been a highly successful Executive Agency. It has achieved major improvements in the conservation and presentation of the palaces, while reducing the call on taxpayers' support. I want to build on that success, bringing in new skills and resources to enhance the palaces and their attractions still further for millions of future visitors.