Accountability, Propriety and Audit
- stewardship of public funds
- value for money
- compliance, and
- the seven principles of public life
This note takes a look at what is meant by concepts such as accountability, regularity and propriety. It notes that Parliamentary scrutiny of the Executive is generally ineffective, unlike Judicial Review, which no doubt contributes to the Government's irritation with the growing use of JR to scrutinise its decisions. But recent civil service reform plans may result in senior officials becoming directly accountable to Parliament for the delivery of objectives which they have agreed to be realistic.
... means being held to account, scrutinised, and being required to give an account or explanation. If it is effective, accountability causes the decision maker to think hard about the the range of decisions that are available to him/her, and the fairness, appropriateness and proportionality of each possible decision. Jonathan Haidt refers to this as exploratory thought, and argues (I think correctly) that effective accountability has three vital elements:
- Decision makers learn before forming any opinion that they will be accountable to an audience.
- The audience's views are unknown.
- The decision maker believes that the audience is well informed, and interested in both fairness and accuracy.
(Apart from their relationship with Ministers), civil servants are in principle accountable upwards through audit and Parliamentary scrutiny, and outwards through transparency and openness to stakeholders and to the public at large, and also through Judicial Review (JR). But only JR meets all three of the tests of effective accountability summarised above.
The main routes for upwards accountability are the Public Accounts Committee (the PAC) (assisted by the National Audit Office - the NAO), other Select Committees, Parliamentary Questions and debates, correspondence with MPs, and the Parliamentary Commissioner for Administration - the "Parliamentary Ombudsman". But Parliamentary scrutiny seldom meets any of the key tests listed above. Parliamentarians love 'naming and shaming', and the Parliamentary spotlight too often moves frequently and unpredictably. And then the views of MPs, when they do get involved in one of our issues, are often highly predictable, driven by party-political considerations. Also, although Parliamentarians cannot of course be expert in many of the areas in which they are asked to form judgements, they very seldom draw on sufficient expert outside advice. They are also not skilled in questioning those who appear before them (who - unlike MPs - often prepare for hours or days in advance of their appearance). All this in turn means that Parliamentary reports are politics-driven, or at least driven by a desire to look good by criticising Ministers, or criticising officials who can neither argue back nor point to bad Ministerial decision-making. It is no wonder that most PAC reports, and most Select Committee reports, have very little long term impact.
- Officials appearing before Select Committees must obey the Osmotherly Rules as amplified by the Armstrong Memorandum: When a civil servant gives evidence to a Select Committee on the policies or actions of his or her Department, he or she does so as the representative of the Minister in charge of the Department and subject to the Minister's instructions ... and is accountable to the Minister for the evidence which he or she gives. The ultimate responsibility lies with Ministers, and not with civil servants, to decide what information should be made available, and how and when it should be released, whether it is to Parliament, to Select Committees, to the media or to individuals.
- This may change if - as heralded in the 2012 Civil Service Reform Plan - senior officials become entitled to refuse to sign off plans which they regard as unrealistic, and are then held directly accountable for the successful delivery of the plans which they have signed off as realistic. Click here to read a detailed review of this Reform Plan.
The main routes for outwards accountability include annual reports, correspondence etc. with the public, consultation etc. processes, and JR. We can also choose to be accountable via media of our choice, and we should for this purpose choose media that will not use their relationship with us merely for entertainment or to boost circulation. Again, all these routes, apart from JR, fail to meet most if not all of the three key prerequisites of accountability listed above.
Judicial Review, however, offers a very effective way of holding officials and Ministers to account - as was evidenced during the West Coast Main Line shambles - a reason, no doubt, for JR's growing popularity. It is also no doubt one reason why Prime Minster David Cameron told business leaders in November 2012 that he intended to crack down on 'time-wasting' caused by the 'massive growth industry' in legal challenges to government policy. Judicial review applications would in future cost more, with less time put aside to apply and fewer chances to appeal.
In more detail: civil servants are accountable for three things:-
1. Our stewardship of public funds etc. including:
◦ regularity which means the requirement for all expenditure and receipts to be dealt with in accordance with the legislation authorising them, any delegated authority and the rules of Government accounting
◦ propriety which is a further requirement that expenditure and receipts should be dealt with in accordance with Parliament's intentions and the principles of Parliamentary control, and in accordance with the values and behaviour appropriate to the public sector - see below.
◦ value for money (VFM), and
◦ effective management systems.
◦ (The PAC takes a particular interest in our stewardship of public funds.)
◦ with the law
◦ with Government policies and initiatives, and
◦ with public expectations of proper conduct:- see "the Seven Principles" listed below.
3. Our Performance, including
◦ against objectives and targets, and
◦ in delivering acceptable levels of service to the public.
The following Seven Principles of Public Life were endorsed in the Nolan Report as encapsulating the values and behaviour appropriate to the public sector:
- Selflessness:- Holders of public office should take decisions solely in terms of the public interest. They should not do so in order to gain financial or other material benefits for themselves, their families or their friends.
- Integrity:- Holders of public office should not place themselves under any financial or other obligation to outside individuals or organisations that might influence them in the performance of their official duties.
- Objectivity:- In carrying out public business, including making public appointments, awarding contracts, or recommending individuals for rewards or benefits, holders of public office should make choices on merit.
- Accountability:- Holders of public office are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office.
- Openness:- Holders of public office should be as open as possible about the decisions and actions that they take. They should give reasons for their decisions and restrict information only when the wider public interest clearly demands.
- Honesty:- Holders of public office have a duty to declare any private interests relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest.
Leadership:- Holders of public office should promote and support these principles by leadership and example.
A useful short version of all the above is as follows.
- Don't bend or break the rules
- Put in place and follow clear procedures
- If approval is needed, get it first
- Don't allow a conflict of interest to appear to affect a decision
- Don't use public money for private benefit
- Be even-handed
- Record the reasons for decisions
The extent and nature of the above lists no doubt contribute to the caution of senior civil servants, even though our personal accountability is pretty limited. But it is worth pointing out that (with the exception of civil service lawyers', doctors' etc. professional bodies) none of the bodies to whom we are accountable can actually discipline or dismiss us. Their power is merely to criticise and shame us.
But this shaming power is only effective if the audience that hears the criticism believes that blame has been fairly allocated. MPs too often appear to cross-examine officials in unfair or unreasonable ways, or seek to criticise officials when they cannot get at responsible Ministers, or at responsible civil servants. Such behaviour certainly catches the attention of Whitehall - and the resultant video gets widely shown - but the victims usually receive considerable sympathy and their 'accountability' leads neither to career detriment nor to any change in the behaviour of the victims or others.
The power of accountability is also ineffective when a civil servant simply does not care about the rules, and either believes that they will get away with it, or does not fear the consequences if they are caught out. The essential safeguard in these circumstances is the audit process backed up by effective management - backed up by careful selection processes when senior civil servants are appointed from outside the Service. The Civil Service itself, and the Civil Service Commissioners, are thus themselves an integral part of the structure of accountability.
There is good general guidance in "Propriety and Audit in the Public Sector" published by the NAO-chaired Public Audit Forum in August 2001.
Detailed guidance is available in the following documents, all on the Cabinet Office or Treasury web sites.
- Civil Service Management Code:- addressed to central government departments and agencies and setting out the terms and conditions on which civil servants are to be employed
- Standards of Propriety:- also addressed to central government departments and agencies, this document covers subjects such as the requirement of staff to seek permission before accepting outside hospitality, and the sale of surplus property to civil servants.
- The Civil Service Code, and
- The Ministerial Code:- The official codes of behaviour for Ministers and civil servants respectively
- Guidance for Civil Servants: an interesting and readable two volume Directory of Civil Service Guidance
- Regularity and Propriety is a handbook written mainly for Accounting Officers but offering a readable summary of what is and is not "proper" behaviour in the stewardship of public funds
- Government Accounting
- DAO letters: (Dear Accounting Officer letters)
- Procurement Guidance
- The Sharman Report: "The Review of Audit and Accountability for Central Government, February 2001.