Oral evidence: Fixed-term Parliaments: the final year of a Parliament, HC 976Thursday 6 March 2014

Oral evidence, 6 March 2014.

Witnesses

Sir Jeremy Heywood, Cabinet Secretary, Cabinet Office, and Rt Hon Oliver Letwin MP, Minister for Government Policy, Cabinet Office, gave evidence.

Chair

You are our final witnesses in our inquiry on a fixed-term Parliament, the grand finale. I am very pleased that you can join us this morning. We have been taking evidence for the last few months and I hope we are going to produce an interesting report. It is unprecedented to have a five-year Parliament. It is unprecedented to have the final year where we know when the election date is going to be. We have been looking at how we could use that final year perhaps more productively than the dogfight that we all engage in in the last 28 days, wondering whether there are opportunities to delve more deeply into what Parliament could do. Having a fixed term also allows a degree of planning, both in terms of scrutiny of legislation, Parliament’s own business, the timetabling of effective scrutiny, and bringing forward Bills more effectively, too, on a given, known timetable. We have also been looking at the financial and personnel side where perhaps, Sir Jeremy, we can encourage you to talk about how a fixed five-year span allowed you to plan way better than when one is not clear when an election might be. Would you like to say anything to start us off or shall we jump straight into questions? No, you are happy to go ahead.

Mr Chope

First of all, can I apologise for the fact I am not going to be able to stay for the whole session because I am chairing a Standing Committee shortly? The first question is one following on from our previous session. Ofcom have recently deemed UKIP to be a major political party. In the light of that finding, do you think that the provisions in the Cabinet Manual whereby opposition parties should be involved in being able to speak to civil servants in the run-up to the general election will apply to UKIP?

Sir Jeremy Heywood

Oliver is passing this one to me. In fact, this is a political decision by the Prime Minister, who determines the shape and parameters of the pre-election contacts guidance. I would be doubtful, but no decision has been taken by the Prime Minister on the overall framework for those contacts so it would not be right to anticipate that.

Mr Chope

Although it is set out in the Cabinet Manual, it is for the Prime Minister to interpret the Cabinet Manual in whatever way he thinks fit?

Sir Jeremy Heywood

Absolutely, yes.

Mr Chope

Rather than for the civil service or the heads of the civil service to advise him on an interpretation?

Sir Jeremy Heywood

Once the Prime Minister has settled the detailed implementation in this particular Parliament, then I as Cabinet Secretary will co-ordinate and oversee the process. I think a degree of political judgment is required; for example, on when the contact starts, which parties to involve, and so on. That is a decision for the elected Government rather than the civil service.

Mr Chope

Can we ask the Member for the elected Government here today to help on that?

Mr Letwin

You can ask but I cannot give you the answer because I am not the Prime Minister, as you may have noticed. I have not discussed this issue with the Prime Minister so I do not know his mind on the subject.

Mr Chope

In the written evidence, which has just arrived, you say in paragraph 7, “The introduction of fixed-term Parliaments was intended to improve certainty and stability in Government”. Do you think that that assertion applies to the present situation where, for example, today we have two different Ministers from the Government, the Liberal Democrat Business Secretary and the Conservative Immigration Minister, making different speeches, one saying that it is really good news that the Government has failed in its target of reducing migration to the tens of thousands, and the other one saying it is absolutely disastrous for the ordinary working people that the Government has missed its target? How can we interpret that as being an indication of stability and certainty arising from a fixed-term Parliament?

Mr Letwin

Well, that is a question I can answer. The first point I would make is that any Government—certainly any of the Governments that you and I have seen, and we have both seen a number over the course of our careers—is to some degree or other a coalition of Ministers who have a wide range of views. There will always be differences of view, but any Government, one party or two or more, has to come by a settled view of its policy and of its legislative programme and has to carry that forward. Thirdly, any Government has to find a way of accommodating those two facts: strong-minded people with different views and the need for a collective approach to policy and legislation. Now, in coalition that has simply accentuated that issue, because it is not just that there are strong-minded Ministers; there are also two parties with different agendas. We are perfectly grown-up about this. We both recognise that each has a different agenda in some important respects. There are some things about which we collectively genuinely agree and there are some things about which we separately genuinely disagree. Part of the virtue of the way we have run this coalition is very considerable honesty between ourselves about where we agree and where we do not agree. The rule of Coalition Government that we have developed in the last few years is we do those things where we do agree and we do not do those things where we do not agree or cannot agree; they get remitted to possible action in subsequent Parliaments depending on the outcomes of elections. As you approach an election, the differences of view are bound to come more to the fore because each party is moving towards an election programme that will, admittedly and understandably on the part of each party, be somewhat different. We are not going to fight the election as a coalition; we fight as two separate parties. We have always known that. Under those circumstances, what is very important is that the stability of the process of making policy and implementing it, drafting legislation and introducing it, and passing it and implementing it is orderly. What is certainly also true is that the knowledge that we have a certain time over which this coalition exists and it then comes to an end, not before and not after a certain date, is helpful in enabling us to have an orderly process of evolving and implementing policy and legislation notwithstanding the admitted differences of view. The Government’s immigration policy, all the measures we are taking, which are many and some of which we are legislating on at this very moment, are agreed. The coalition parties are working together to implement those policies. There are quite different views about some aspects, as you have seen. It is a perfectly grown-up way to conduct business. It is easier to conduct that business because we know that there is a definite time within which that programme is to be enacted.

Mr Chope

The coalition agreement said that it was the policy of the coalition to reduce net migration to the tens of thousands. What is clear is that the minority party in the Government has been actively undermining that and has now come right out in the open saying that they do not support it, never thought it was a good idea, and the fact it is not going to be achieved is great news. How is that consistent with the principles of collective ministerial responsibility?

Mr Letwin

Oh no, both parties in the coalition are at this very moment both implementing a set of policies that have been agreed and legislating about a set of things that we have agreed to legislate about, a perfectly orderly way. The fact that there are differing views about economic issues associated with immigration and many other things besides across a wide terrain is fine as long as the Government continues in an orderly fashion to implement its policies, which it is. The ability to reconcile those two things, which is a complicated process, as I say, in any Government and more complicated in a coalition, is certainly aided by the fact we know that there is a timescale over which we are doing that.

Mr Chope

The Government is still aiming hard to try to reduce net migration to the tens of thousands?

Mr Letwin

Yes.

Chair

Just a very quick one, Paul.

Paul Flynn

Just very briefly, do you think it would be a sensible use of civil service time to have talks with UKIP when the present betting odds are 250 to one that UKIP would be forming part of the next Government?

Chair

I do not know whether even answering that question is a very good use of this Select Committee’s time. Now you have made your point, Paul, we will move on.

Chris Ruane

Before I move on to my questions, you batted the question from Mr Chope before about UKIP access to civil servants. In a very non-political way, you said you could not possibly comment because that was too political. Our honourable colleague Paul Flynn said our two esteemed witnesses today were a politician who thinks he is a civil servant and a civil servant who thinks he is a politician. Could you give us a personal opinion? If you will not give us a political opinion, can you give us a personal opinion on the issue raised by Mr Chope?

Mr Letwin

No.

Chris Ruane

No. That is a politician’s answer. Well done. My allocated question: the Committee reported on the impact of the Fixed-term Parliaments Act 2011. We called on permanent secretaries to regularly discuss how fixed-term Parliaments would affect departmental planning and identify best practice. Could you tell us to what extent this has occurred?

Sir Jeremy Heywood

We do have not particularly frequent but regular discussions. I think the last one was probably last summer and I wrote to you, Mr Chairman, following that. We are probably due to have another one. It is definitely an issue that we are interested in as a set of permanent secretaries. In individual departments, a lot of thought is given to this, but in a sense we are just getting on with the business of supporting the Government rather than spending a lot of time thinking about relatively abstract issues. We are very happy to keep the dialogue going and make sure we are all learning from each other.

Chair

It is far from abstract; we are in the middle of it now, aren’t we? For the first time we have had a full fourth year. Is that not something that you would welcome?

Sir Jeremy Heywood

Very much so, yes. As you know, we think it has definitely brought some stability. It has made it easier to plan, as you said earlier, personnel issues, financial issues, legislative issues. It has definitely brought a lot of advantages, I would argue probably more so in years three and four of the Parliament than year five, but until we have been through the whole five years it will be difficult to give a completely comprehensive assessment. It has definitely led to a net improvement in planning, long term-ism, sequencing, and so on so we definitely support it.

Mr Browne

My questions were about specifically financial planning. The two parties in the coalition have been required to put forward a budget for the 2015-2016 financial year despite the fact that they can only be certain of being in Government together for the first month of that year and that will be the general election campaign. I suppose it is inevitable that all Governments will find themselves in that position because the financial year will not perfectly map that of a political cycle. Are there any particular difficulties caused by coalition when it comes to financial planning? Do you have to draw up an alternative shadow budget in the event that the Conservatives win the next general election outright and they can strip the real budget of the bits that the Lib Dems insisted on putting in? Is the exercise different than if we had a single-party Government?

Mr Letwin

Jeremy will say something about whatever the civil service is or is not doing in relation to the rest of the year 2015-2016 after the election. So far as the Government itself is concerned, I do not think that the dynamics of coalition make any difference to this at all. I do think that the existence of the fixed-term Parliament, or rather perhaps what I should say is the existence of a five-year Parliament that hence stretches into the financial year of which the election is part, does have an important influence. It would have been irresponsible for the Chancellor—and the Chief Secretary indeed—not to have put forward broad and detailed spending plans for the year 2015-2016 given that that money will start to be spent before the election and hence under the control of this Government. Obviously, it is a matter for the PAC rather than for this Committee, but nevertheless I am sure that this Committee would also recognise it is extraordinarily important in the national interest that where decisions are going to be made that affect real people, real investments and so on, they should be made well in advance and well locked in so that the recipients of those monies can use them effectively and efficiently and not be in any doubt. It would be extraordinarily haphazard if you had a month or two at the beginning of a financial year in which nobody knew what was going to be spent. Of course, as 2010 shows, where we introduced an emergency budget directly after the election, it is always open to an incoming Government of whatever persuasion to adjust the budget within the limits of what can efficiently be adjusted without failing so many expectations it creates too much inefficiency. This does not in any way limit democratic decision making, but I think it is, for the sake of good order, necessary to do. As I say, I think that is a consequence of the fact of a five-year Parliament. It is, therefore, a consequence of the fact that we will continue, if the present law remains in place, to have rolling five-year Parliaments that do stretch over financial years. Under those circumstances, I think it will become a regular matter.

Mr Browne

Sure, a five-year Parliament must make it easier to plan because we all know, barring some unforeseen mishap, that hangover of the first month of the financial year will be before the next general election. Mr Chope and Mr Flynn have both walked out just before I was about to ask my second question but it is really a question that they have both been driving at.

Mr Letwin

I was wondering whether he was disappearing entirely.

Mr Browne

They will be able to read about it. It is the exchange you had about the differing emphasis that the Business Secretary and the Immigration Minister were putting on the desirability or otherwise of higher or lower levels of net migration to this country. Maybe it is more of a question for Sir Jeremy. When discussing how well this Government functions in its final year, based on your experiences of previous Governments, would you say this one was uniquely or particularly dysfunctional? The reason I say it is because both Mr Chope and Mr Flynn—and I have heard the view put forward by others who are keen exponents of single-party Government—claim that this coalition is more dysfunctional. You had a close insight into the last year of Gordon Brown’s tenure as Prime Minister when, for example, I remember James Purnell resigning as a Cabinet Minister and the destructive act to try to bring the Prime Minister down. I do not know what your civil service experience was when John Major was Prime Minister. I remember him resigning as leader himself and being challenged by another member of his Cabinet. None of these things have happened. Of course, Margaret Thatcher was brought down by her party. I just wonder why you think some people think that this coalition is inherently unstable when from the outside viewpoint that I have it appears to be far more stable and far less acrimonious than previous Governments.

Sir Jeremy Heywood

You would not expect me to start getting into comparing one Administration with another. I am not going to do that. I think you do have to distinguish between political messaging for public consumption and the functioning of Government. The other thing I would just remind everybody of is we are not in the final year yet. We still have some months to go before we get into that final year.

Chair

428 days.

Sir Jeremy Heywood

Exactly. Just in terms of how the Government is functioning, I do not see any disturbance from how we have been functioning for the last nearly four years, which is Government is functioning pretty steadily, competently, getting business through. We have quad meetings; we have Cabinet meetings; we have a budget coming up; we have a Queen’s Speech coming up. It feels like pretty normal Government to me. I think that is probably what I will say on that subject.

Chair

It is normal now, whereas historically this would be a period of frantic discussion, speculation and possibly paralysis, but normal Government is carrying on. We have a fixed term and it can carry on.

Sir Jeremy Heywood

Yes, that is the point about a fixed five term versus a fixed four term or an uncertain period. You are absolutely right. At this time there would be a huge amount of speculation normally as to whether or not the Prime Minister is going to call an election.

Mr Browne

A very quick supplementary. Does it also give you reassurance as a very senior civil servant that the Government has a clear working majority? In other words, is a fixed-term five-year Parliament with a Coalition Government with a majority of somewhere in the region of 70 reassuringly stable compared to a minority Government that lives day to day, hand to mouth, depending on the votes in the House of Commons?

Sir Jeremy Heywood

Again, I am not going to get sucked into a discussion about coalition Government versus minority Government versus a single-party Government. My job is to make sure that the Cabinet have the support and advice they need and that the Government can function and carry out its mandate. That is what we are trying to do and so far so good in terms of carrying through the coalition agreement’s policies into practice. That is our job.

Mr Browne

You would feel you could plan on exactly the same basis if we had a minority at the moment Conservative Government with 309 MPs? You would feel just as confident that the Government would be able to deliver the Queen’s Speech and the budget in the last year of the Parliament as you do now with the coalition?

Sir Jeremy Heywood

No, I did not say that. Clearly, different sorts of Government require different sorts of planning. As a civil service, our obligation is to work with whatever the people of this country throw up by way of MPs and party configurations and try to make that work as best we can. That is our job.

Robert Neill

Just very quickly, I was interested in the response that you submitted last night around the concept of the five-year rolling spending review, 10-year spending review. I get the sense that the Government is saying, “We do not like the idea of a five-year rolling spending review.” The evidence we had was a suggestion of a 10-year rolling review, on the basis that a lot of the long-term financial planning around, say, things like early intervention in health or infrastructure planning or whatever obviously are going to go for much, much longer periods than any electoral cycle would ever be, fixed or otherwise. Against that background, is the objection to the rolling nature of it or is it the linkage with the length of the Parliament that is the problem? Is there some merit if it was a firmer spending review? You say, “Advantages in establishing clear budgets for several years ahead and sticking to them.” I broadly agree with that. Is that an argument for a very firm spending review over a five-year period of a Parliament and perhaps then something indicative beyond?

Mr Letwin

Clearly, this is a balancing act. On the one side, there is very considerable advantage in stability of expectations so that people can plan against that, can invest for savings that may not materialise for a year or two, and can optimise the way that they deliver services to the public and investments in infrastructure and so on, knowing the path that will be followed rather than short, sharp, jerky movements of funding, which inevitably engender considerable diseconomies. On the other side, the national Exchequer is not in the same position as the board of a firm because the Treasury is both a ministry of public finance and a ministry of the national economy. The Chancellor of the day has to concern himself with the economic effects as well as the fiscal and microeconomic effects. He also has to concern himself with the macroeconomic effects of spending plans and hence has to concern himself with the macroeconomic necessities of the day in conjunction with the governor of the bank and the MPC, which argues for great flexibility in public spending. You have on the one side a strong argument for great stability and on the other side a strong argument for great flexibility. Now, there is no right answer and it partly depends on times and places, but the balance that we reflect in that paper and that the present Chancellor and Chief Secretary have struck is one that has tried to get a reasonable length, which they judged initially to be three years for stability, in the expectation that with a long-term economic plan, which this Government has and is rolling out, it was possible to be reasonably confident that that would work macroeconomically against the background of some very careful work with the MPC while at the same time providing a reasonable stability of expectation for investment and spending. We then come back to the point that Mr Browne was making, which is that, of course, it is an exercise in idle speculation for a Government in one Parliament to seek to pretend that it can determine what the spending would be in 2016-2017, 2017-2018, for example, especially a Government that intends at the general election to dissolve itself. It may or may not come back in any form, either or both of the parties, but we know that we will go into an election undoing this Government. It would have been very odd to try to create a public spending pattern as a whole in detail for the later years of the next Parliament after the very first year, which stretches into this Parliament.

Chair

Does that apply to defence spending or road infrastructure?

Mr Letwin

Thank you, Chairman, I am just coming on to this. What we decided to do was to square that particular circle by identifying some kinds of expenditure that are relatively long dated, have long lead times built into them, and are relatively politically uncontroversial. That is not to say that there may not be differences of emphasis, but it is broadly true that any Government is going to want to maintain the defence of the realm, is going to want to build roads and railways, and so on. There are things that you can just about predict.

Chair

But not run an effective economy?

Mr Letwin

Yes, any Government will also seek to run an effective economy, but the point is when you come to the balance between stability of expectation and macro flexibility, that balance comes out differently in different domains. If you have a transport programme where, despite great efforts that both Jeremy and I and, indeed, other colleagues have made to shorten the time that it takes to get between conception and road building, nevertheless there is a very long lead time because of environmental constraints, planning constraints, and so on and so forth. It therefore makes abundant sense—given that once there is a plan to build a certain road it is probable that the future Administration will wish to carry on with that—to have a quite long period during which you set a budget for road transport improvements and can plan against that. Now, of course, future Governments may always alter that, but it is likely that they would alter at the edges rather than totally. Similarly, with defence capital expenditure, equipment expenditure, as opposed to defence current expenditure—largely, not wholly, manpower—we made the decision that because the lead times are very long, in many cases regrettably even longer than for road building or the building of railways or airports or whatever, and because there is an enormous amount of importance attached to stability of expectation on the part of the suppliers if you are going to get anything like keen pricing, we decided to stipulate a path for defence capital expenditure and then to enable MoD to commit to expenditures well in advance, which then become contractual and, of course, the future Government, because Britain is Britain and operates under the rule of law, would not break without—

Robert Neill

You would not break the contract, yes.

Mr Letwin

Exactly, without paying a penalty. I summarise it all by saying because it is a balancing act we have tried to get a reasonable length within a Parliament of expectation for all expenditure, acknowledging that you cannot do that beyond the lifetime of the Government, but in order to reconcile that with good stability of expectation in those areas where it is most important and most possible we have produced longer timescales for expenditure in those domains like transport capital and defence capital.

Sir Jeremy Heywood

The only point I would add, coming back to the question that you asked, Mr Neill, is on this concept of a rolling five-year period or a rolling 10-year period. I think what we were trying to get across in the Government’s response was we do not like the idea of every year you update. If that is what you meant by a rolling programme, we think that would introduce too much flexibility relative to the stability and benefits that would come. Maybe we misunderstood what the Committee was driving at with that concept. I think we are in favour of four years, five years, whatever, 10 years for some capital projects, but not if the sense is that every year that falls to be readjusted, because then you lose many of the stability benefits you get. That is the precise point.

Robert Neill

That bit I have a lot of sympathy with because, as you say, there is no magic in whether it is a three-year spending review or a four year, as local government might like, or a five.

Chair

Isn’t it an interesting use of a stable final year to attempt to get some sort of consensus politically—there will never be a complete consensus—around what future spending might be? Is it possible for the office of management and budget or whoever, the National Audit Office, to co-operate with Parliament in order to find some common ground about the things that may be shared by all parties after the next election? Of course, whoever wins the next election will want to change around the margins and perhaps some fundamental things, but can’t we use this last year a little more imaginatively than just looking at the watch waiting for election day?

Mr Letwin

I would distinguish, Chairman, between two propositions. On the question of the spending aggregates and their departmental allocations, I do not think there is any prospect or hope of consensus because I know that the Conservative Party certainly would not want to have a consensus unless everyone else happened to agree with the Conservative Party about this. I suspect that each party here is in the same position. This is a very fundamental part of one’s approach to the management of the economy in the next Parliament and it is heavily influenced by all sorts of perfectly proper political considerations. It is likely to be one of the major debates of the next general election. Getting a consensus on that is unlikely.

Chair

Let me turn that round, then, Oliver, and say would it not then be sensible to find out what the differences were and allow the civil service to have a think about that in the final year of a Government? Let us not find consensus; let us find difference and let us find how we might handle that post the next general election.

Mr Letwin

Well, at an earlier stage in the proceedings I think you used the word “dogfight” of the last 28 days. I prefer to describe the general election as an expression of democratic decision making, which for all its disadvantages—and I think you will know I am not the most partisan of politicians—nevertheless general elections crystallise very clearly certain critical directional differences between the different parties. That is what is put to the electorate and the electorate makes a mature decision on that basis. I welcome that. I do not think that this can be teased out by the National Audit Office or the OBR or, forgive me, the civil service. I think this gets teased out in some much deeper way by general elections. That is their value.

Chair

Unless we have a view, a plan, and see this as an opportunity, aren’t we necessarily going to see a 28-day discussion or dogfight extended to some degree into this final year? Is there not a more creative, imaginative and constructive way to use the final year than assuming that there will be the normal 28-day dogfight? It just seems we are looking at this as commentators rather than saying there is an opportunity here. We can involve Government; we can involve Parliament; we can involve political parties in this unique occasion of having a stable final year.

Mr Letwin

Well, no, I do not agree with that. I think that, in the course of this final year, we have the advantage that we know it is in all probability the final year. We are not all spending an enormous amount of time guessing whether there is going to be an election next week or the week after. That is an advantage to everybody. It is an advantage to Government because it can pursue its business. It can pursue its fourth term legislative programme. There will be a serious legislative programme announced at the Queen’s Speech. We all know that there is time to carry through a serious legislative programme and to debate it properly. One does not have all the apparatus of sudden election wash-up and so on and so forth. That is all an advantage. In the course of that year, because people are not feverishly trying to work out when the next general election is going to be, it gives both the Government—in fact, in this case, both of the parties of Government—and the opposition parties the time to set out their stall, to work out very carefully and clearly what it is they are going to put to the electorate, to reveal as much of it as they choose to reveal at each moment during that period, and to conduct a public debate in a serious way. I am a real believer in democracy. I think that that process helps educate the public about the choice it is going to make at the next general election. Of course, some of it is done at a higher level than others, but in general I think the longer people have to set out their stall in a coherent fashion the better for democracy and for our country.

Sir Jeremy Heywood

Of course, the civil service will be working on financial projections, financial options, policy options that may be relevant to whichever Government takes office after the election. As far as we are concerned, this is not a wasted year at all. A lot of preparations go on in terms of at least understanding the financial drivers of policy and so on. One of the issues I would expect to be raised by opposition shadows when the pre-election contacts eventually start would be from the opposition’s perspective what their plans would be. Part of it is to inform the civil service of issues that they may not wish to make public at that point so the civil service can get on with, when the election starts, preparing for that possibility as well. I would not want people to think that this was a year of inactivity by the civil service; far from it.

Tracey Crouch

Given the answer to Bob’s question around long-term spending plans and the response from Sir Jeremy about having discussions with political parties about policies, will the Treasury or other departments provide information to political parties over the coming year, over the coming 428 days, in order to ensure that the manifestos contain sound economic commitments, or will that just reduce the democratic aspects that, Oliver, you were referring to of the election? Will it take out all the fun of the election, of trying to trash each other’s manifestos, if that were to happen?

Mr Letwin

Well, I think my answer to that is neither, in the sense that—this is nothing to do with fixed-term Parliaments—there has been a very fundamental change in the course of this Parliament, which is one of the things I am proudest of about this period of Government, in the level of transparency of information to do with nation’s finances that can be used by everybody: commentators, political parties, Parliament, Government, and so on. It used to be the case that the Chancellor of the Exchequer arrived at the despatch box at the Autumn Statement, as it used to be called, and the Budget and made predictions of the forthcoming effects of his or her policies. I think we all know, without wishing to descend into extreme partisanship, that there were examples of policy-based evidence-making in such budget predictions. Now that has been replaced by the Office for Budget Responsibility producing a genuine, impartial, extraordinarily well informed prediction, which is not influenced in any way by politicians and against which the actions of the Chancellor of the day can be judged by the British population. So far at least, the OBR has proved to be extraordinarily good at establishing that it is independent and, indeed, it has also proved to be pretty much as good as you could expect a forecaster to be. Allied to that is a change that was made in the previous Government, which the present Government has continued, of course, which is the creation of the MPC. Then this Government has also introduced a level of financial transparency about the doings of Government and the expenditure of Government itself, completely unprecedented and, in fact, so far not, as far as I am aware, replicated anywhere else in the world.

Tracey Crouch

Given how proud you are of the transparency, would you agree with the evidence that we have had from the likes of Civil Exchange and the Fabian Society that we should publish an end of Parliament fiscal report, which will help provide a clear statement of the fiscal issues that are going to confront the next Government?

Mr Letwin

The OBR does publish a fiscal report at each succeeding moment to coincide with the Budget and the November statement. That is the best you can do, but it is obviously not at a level of granular detail that you can then get by going into the expenditures. I do not know whether the opposition has yet realised the extent to which you can now find out what the Government is actually spending. I think we are at the foothills of the use of that material by politicians and commentators and, indeed, we might get to a more grown-up circumstance in which various elements of the media that tend to make wild assertions go and do some research. It is now available on the net; it is possible to do. You can find out in awesome detail how these very large, rather meaningless numbers translate into real things. That combined with the OBR gives you a very, very clear line of sight on where things are at and where a highly informed, independent organisation, very well capable of doing that job, prophesises that things will go in the next year or two after that. That is really as good as a country could possibly do by way of transparent information.

Tracey Crouch

Should the Treasury or other departments be providing information to other political parties in order to ensure that they are coming up with sound economic commitments for their own manifestos?

Mr Letwin

But my point is the Treasury does not need to and, indeed, it would not carry conviction if it did because it would be accused of being biased, whereas the OBR does. I was once Shadow Chancellor. When I was Shadow Chancellor I had a very severe problem, which is I could not get any data that were meaningful because I knew that the data were being produced by my political opponent, the Chancellor, for purposes that were in large part his purposes.

Tracey Crouch

What is the point, then, of the civil service being open to opposition parties for discussion?

Mr Letwin

There are two very different things here. One is the transparency of financial and economic data and predictions, now highly transparent, previously highly obscure: advance. Secondly, the question: if you are in opposition and you have formulated a set of policies, how do you smoothly translate those into action? What do the civil service mechanics look like? What kinds of obstacles in terms, for example, of legal and juridical obstacles, European-level obstacles and global obstacles might you not have thought of and how do you navigate those? How do you organise your Cabinet committees? How do you organise the relationship with centre of Government, the periphery of Government? All of these issues, which are, if you like, second order politically compared to the policy thrust and the direction you are trying to take the country in, which nevertheless become extraordinarily important if you then become the Government, are issues that can very profitably be discussed between the opposition party and civil servants in order to make sure that if they become the Government they are then capable of translating their policy direction into action in a smooth and effective manner, or anyway in a more smooth and effective manner. Certainly, in my experience, Jeremy and I had conversations before the last election about the structure of the centre of Government. Clearly, in the outcome that had to be adjusted in the light of coalition dynamics and negotiations, though interestingly not very much. We overlaid on it some things that were necessary in order to make the coalition function properly, but because we had done that work and done it with the civil service in advance, we knew what our Cabinet committees were going to look like. We knew what structures we were going to set up—for example, the National Security Council. We even knew who was going to sit at the centre and how we were going to do that and how the centre would relate to the periphery. We had had all those sorts of discussions. Because we had had them, we were able to move fast into action and make good use of the first months of Government, which are in many ways the most fertile of all the terrains Governments have. That is what I see as the value of the interaction between opposition parties and the civil service. It is not to formulate policy—oppositions need to formulate policy directions themselves using the fact that they are liberated from the necessities of Government—nor is it to convey financial information; that is now transparently available. It is to sort out the mechanics of the implementation of your programme so that you can do it smoothly and effectively in Government.

Tracey Crouch

Can I turn very briefly to the final year of our legislative programme? It is quite clear at the moment that there is very little in the fourth year of the legislative programme still to do and as Members of Parliament I think we have had one vote in the last two weeks. When you say in your written evidence to us that the Fixed-term Parliaments Act allows the Government to plan a full legislative programme for the final session of the Parliament, can you define to me what a full legislative programme means?

Mr Letwin

Yes. The first point is the Government has managed its business well in this session of Parliament and, therefore, their heavy legislative programme, which has been continuously very heavy in this session, is now largely focused in the Lords, as it happens, because the stages in the Commons have gone pretty smoothly. If you look at the volume of legislation in this session, it is very high. Of course, it is not nearly as high as in the first term, which was an almost two-year term inevitably, but for a one-year session it has been a heavy programme. I believe that the Government has now announced the date of the Queen’s Speech for 3rd June.

Tracey Crouch

I saw on Twitter this morning that it was, in fact, 3rd June.

Mr Letwin

On that date, a fourth-term legislative programme will be announced. I think you will find—in fact, I know you will find—that it is a very serious and very full programme of the legislation. It would, of course, have been open to a Government that did not have a fixed-term Parliament to announce a full-term legislative programme notwithstanding at the Queen’s Speech, but everybody would have looked at it, as I have experienced in previous years, with some scepticism because they would have said, “The election might be the day after the Queen’s Speech, it might be a week after, it might be six months after, we have no idea. We do not know how much of this programme will really come about.” This time we can say that the very great likelihood is that Parliament will stretch right to the point at which it is meant to end and that the Government will stretch right to the point at which the election starts and, therefore, this legislative programme we announce on 3rd June is perfectly serious, just as serious as all the previous legislative programmes of this Parliament, that we will carry it through, that we will manage the business of both Houses sufficiently well to carry it through. We have a working majority with which to carry it through and, therefore, it is just as serious as the previous programmes were. That is a big advantage because it means that instead of being constrained to legislate seriously only in the period before election speculation starts, you now have the opportunity to carry right through the Parliament legislating on a serious and co-ordinated basis.

Tracey Crouch

I think many colleagues would agree that it is not necessarily a bad thing having a lighter legislative programme if, in fact, we were doing better legislation in terms of scrutiny. As you know, we have not had very much to do in terms of legislation on the floor of the House of Commons since Christmas, and yet today via written ministerial statement a Bill that was rushed through in a matter of days at our end of the House is having to be revised by secondary legislation. If we had had longer scrutiny of that piece of legislation, maybe we would not have to then have supplementary secondary legislation. Is it not the case that we could have a lighter but better legislative programme if we were fully properly planning the five-year fixed term?

Mr Letwin

I do not think this has anything to do with the five-year fixed term. What the five-year fixed term does is to make it much easier to have a solid programme of legislation in the last year. It is always the case that Governments can benefit from thinking through their legislative programme in such a way that there is maximum opportunity for scrutiny and that it is elaborated properly and carried through properly so that there are no regrets. That is always the case; no legislative programme has ever been perfect in that respect and I am sure they never will be perfect. On the whole, during this Parliament the Government has carried forward a very well conceived legislative programme that has carried out and implemented the programme for Government with extraordinary fidelity. Regardless whether you think it is the right programme or the wrong programme—that is a matter of political debate—I think any impartial political observer or commentator looking at the scene over the last five years, or what will have been the last five years by the end of the Parliament, and comparing it with any previous Parliament will see that this Government has with extraordinary fidelity carried through a programme that it set out right at the beginning. That is what the legislative programme is there to do.

Tracey Crouch

Peter Riddell in the evidence session before yours—

Chair

Let me just bring Sir Jeremy in on that point.

Tracey Crouch

Sorry, yes.

Sir Jeremy Heywood

Well, I entirely agree with Oliver. Obviously, we can always do better, but I think one of the great virtues of a five-year fixed-term Parliament is that you can pace yourself and you do not need to rush legislation if it is important. We are still learning somewhat the benefits of the five-year period and, as I say, I am sure one or two things could have been taken at a more stately pace. Overall, there is no doubt the direction of travel here is that if you have a fixed-term period of five years rather than an uncertain prospect of four, that will definitely allow you to do exactly as you want, which is to take your time to get things right the first time so you do not have to amend it subsequently because you are not in so much of a rush. That is, in a sense, a statement of the obvious but it is one of the most important benefits you get from a five-year fixed-term Parliament.

Tracey Crouch

I do not disagree with that. One of the comments that Peter Riddell made before you came into the committee room was that there are many different aspects to Parliament beyond the House of Commons Chamber, and yet we as individual politicians are often judged on our presence in the Chamber itself. One of the interesting suggestions and recommendations that he made was that there could be a lot more post-legislative scrutiny. I just wondered what your thoughts were on that.

Mr Letwin

I think there is opportunity to increase the amount of post-legislative scrutiny. This is in Parliament’s hands. My own view is that one of the most useful assets of Parliament is, in fact, the Select Committees, which are increasingly significant. It lies open to the Select Committees to do more post-legislative scrutiny. Personally, I would welcome that. Government itself is doing a considerably enhanced amount of post-legislative scrutiny of its own activities, because that is part of something that both Jeremy and I have very much championed in the last few years, which is Government focusing more on the question of the implementation of its policies on the ground and trying to find out what happens on the ground. Our implementation unit goes out on the highways and byways and tries to find out what is happening. It is all very well to have a policy, to have a law, to have regulations, to have administrative systems. The next question is: what is actually happening to Mrs Jones? Is she getting the house you thought you were giving her? We have focused much more attention at the centre, heavily sponsored by the Prime Minister and Deputy Prime Minister, on that question. The unit responds directly to Danny Alexander and myself and is staffed with absolutely superb civil servants who go out and find out about those questions. Now, that is all part of trying to make sure that we scrutinise our own actions long after the legislation has left the Chamber. There is another aspect, too, which is very much for Parliament, which is to look at the operation of the legislation and ask has it operated as intended. I would welcome an increase in focus on that by the Select Committees, which I am sure are the right and powerful instrument for doing it.

Chair

Jeremy, please come in but be rather brief. I have to get Chris in.

Mr Browne

Very briefly, I just wonder, while we have the opportunity and we are reflecting on innovation brought about essentially as a result of coalition, whether you feel, Sir Jeremy, although you were not directly responsible at the time, that the Deputy Prime Minister was very badly let down in the first few months of this Parliament by the lack of preparedness of the civil service for a full-blown coalition?

Sir Jeremy Heywood

No, I do not think so at all. Both he and his team and we in the civil service learnt from those first few weeks and months and gradually adjusted and we carried on adjusting, frankly, all the way through the Parliament. Relatively recently, for example, the Deputy Prime Minister has decided to build up some further capacity into his office. You learn on the job, but I do not think the first few months of the coalition went badly at all. I think it got into its stride remarkably quickly with a very comprehensive programme.

Chair

Jeremy, we are going to have to move on, unfortunately, because we want to get to the pre-election contacts. Do forgive me.

Chris Ruane

Just before we do, Sir Jeremy, you mentioned before that a five-year Parliament will allow us to pace and space legislation so there is greater scrutiny. Do the statistics back that up? Has legislation that has come through the House over the past five years had more time, more days, more hours on the floor of the House for each piece of legislation?

Sir Jeremy Heywood

I have not seen that piece of analysis, to be honest, but it is exactly the sort of issue that I think after the end of the five-year Parliament is one of the issues that we will need to look at as part of the post-legislative scrutiny.

Chris Ruane

Yes, perhaps we could get the statistics for that, Chair. My question is: when we last looked at the impact of the Fixed-term Parliaments Act 2011, the then Minister for Political and Constitutional Reform, Chloe Smith, told the Committee, “It is still the Prime Minister’s prerogative to arrange for opposition access to the civil service in what has historically been, in the last 18 months or so, a non-fixed Parliament and, of course, it is for him now to make arrangements for that in a new fixed-term context.” Has a decision been made about when these contacts should begin? Gus O’Donnell, when being scrutinised by the Committee, said that he believes that that period should begin 12 months before the next general election. We have a formalised date for the next election. Should we have a formalised date for access for opposition parties to the civil service?

Sir Jeremy Heywood

Well, no decision has been taken. I would expect it would want to be taken fairly soon. It is about time we clarified that.

Chris Ruane

Is that too much power to give a Prime Minister?

Sir Jeremy Heywood

No, I do not think so because the civil service works for the Government of the day. The Prime Minister, I am sure, will consult the Deputy Prime Minister on this. We have a Coalition Government at the moment. Obviously, our primary responsibility is to make sure that the elected Government is served adequately, well, and we continue to implement policies and help the Government develop policies. That is our prime responsibility. It is for him then to decide at what point he is comfortable about the civil service then—

Chris Ruane

If he left it too long, say he left it for another six months or nine months or 10 months, is there any point where you would intervene and say, “Hold on, we need to gain access to the opposition parties and they need to gain access to us for the better running of this country after the next election”? Would you ever raise a concern and at what point would you?

Sir Jeremy Heywood

I do not think it will come to that, to be honest.

Chris Ruane

But would you?

Sir Jeremy Heywood

If I felt that things were being handled in a way that is inconsistent with precedent and the interests of good government I probably would raise the issue, yes, but I do not think it will come to that.

Chris Ruane

What date would that be?

Sir Jeremy Heywood

I am not going to hypothesise about that. Gus may have said 12 months. The norm, as you know, has been 1st January before the first plausible spring election time, which sometimes has meant four to five months, sometimes has meant 16 months or so, depending on whether it is a four-year Parliament or a five. Having a fixed-term Parliament gives us an opportunity to set out what I think will become a new precedent, although obviously any future Prime Minister would be able to change it. He needs to think about that, discuss it with the Deputy Prime Minister, and then we will set out the outcome of that. I am sure he will allow a reasonable period because he understands the importance of this.

Chair

Is this under active consideration at the moment?

Sir Jeremy Heywood

It is, yes, but I cannot make a commitment as to a timetable.

Mr Letwin

Could I add something as a user of the service in the past, which relates to what I was saying to Tracey Crouch a little moment ago? I have probably had more of these conversations than anybody else living because when I was doing essentially the job I am doing now but in opposition I covered, as I do now, the policy waterfront, so I had conversations with broadly every permanent secretary before the last election. My own experience in opposition repeatedly is that what is useful is getting to the point where you know enough about your own policy programme so that you have well formulated questions about the mechanics of implementation and you are not simply having a pleasant chat with a civil servant about the possibility of the policy. You cannot get the civil service, however many contacts there, to start formulating for you your direction in Government. That is the key task of an opposition party as it approaches an election, or indeed, while we are at it, of all political parties as they approach an election, to work out what direction they want to follow after the election. Once you know the direction and you know that the way you are intending to translate it into action as a policy is A, B, C, D, E, then you get to a level of detail where you are talking about the mechanics and then it is really useful to talk to the officials. Of course, you might have an opposition that had decided to produce its entire directional programme and work out all the major policies it is going to pursue at a very early stage in the Parliament. It is very unusual and my guess, therefore, is that the most useful contacts, whenever they actually start, will always be those that are within a few months of the election, where the opposition parties have got pretty clear about what they are trying to do and they want to make sure that if they do then become the Government they can get it all to happen in a smooth way and they therefore want to discuss the mechanics. That is quite important. Without being either indiscreet or impolite, I think there has been from time to time in the past a tendency to suppose that if you just have these discussions this is somehow useful. I remember one discussion that I had at a very early stage when I was in opposition that will always remain with me as one that was extremely pleasant and entirely useless. We did not yet know when we were having that discussion what we were going to be doing, and the permanent secretary in question, therefore, had nothing much to discuss with us. This is not very profitable. You need to be in a position where you are near enough to the election so you do know what you are doing and you are asking very sensible, concrete questions. Can we do this legally? What kind of mechanics would be involved? What might we need to do to the structure of government in order to make it possible to do? Then you can have a serious discussion.

Chair

Sir Jeremy, the Institute for Government said that the guidance on pre-election contacts has been unclear, confused, and it should be recognised that the discussion may cover likely costs and potential implementation challenges of planned policies. Do you think the fact we have a year now will mean that we can get it better this time round?

Sir Jeremy Heywood

I do not really agree with the Institute for Government on that. I think the guidance is pretty clear. All parties essentially know what these contacts are about. It does not need a huge amount of guidance, to be honest. Again, details of that will be settled by the Prime Minister in consultation with the Deputy Prime Minister when the right time comes. I personally think it is pretty clear what we are doing here. Frankly, to build on what Oliver was saying, whatever the benefits to the opposition, there are benefits to the civil service to have a very clear understanding once the opposition has its policies clear in its own mind, as it were. It is very useful for us to be briefed on potential machinery of government changes that might take some time to work through, to understand the legislative priorities for the early stages of the potential new Government. I think it is very useful to impart factual information about the organisation of the department so that they have a clear understanding of what it is they will be working with. There are definitely benefits to the civil service of doing this in a timely fashion. I think the guidance is pretty clear about what this is. What it is not is providing advice because we are providing advice to the elected Government, not to the opposition. I do not think there is any lack of clarity about that. Obviously, I am sure we can improve the wording and tighten it up and so on, and that is something I am very happy to take away and discuss with the Prime Minister. Fundamentally, do I think we have a problem here? I do not. I think there is quite a lot of understanding about how this works.

Chair

Is this facility available just to Her Majesty’s Opposition or is it available to political parties? Clearly, it is possible that one or more of the political parties will have a separate view about what should happen after an election.

Sir Jeremy Heywood

This is the question that came up right at the start of the session. The Prime Minister has not made a decision about that, but my guess, my instinct, is that he will want to focus attention on Her Majesty’s Opposition. But that is a decision for him as the Prime Minister to take.

Chair

In that case, the Leader of the Opposition should make representations to the Prime Minister or to yourself about when these discussions might start most expeditiously?

Sir Jeremy Heywood

He could do either, but the fact is the system will come to a decision on this of its own volition regardless of any representations. I am sure it will be a reasonable decision in line with precedent.

Chair

Sir Jeremy, Oliver, thank you both very much for coming in and concluding our evidence-taking on this topic. We will produce a report, hopefully very shortly, for your consideration. Thank you so much, and thank you, colleagues.

Fixed-term Parliaments

the final year of a Parliament, HC 976