Committees should be “Independent”, and Not Suffer “Conflict of Interest” and “Vested Interest”
Which Are Not Allowed????
On Tuesday 7th November, the Treasury Select Committee were due to question the National Infrastructure Commission, about infrastructure policy and the independence of the organisation.
Whilst the nature of ‘independence’ the committee are likely to concentrate on is independence from the Government and more specifically the Treasury, there has to also be the very large question about how independent they are of the industry that seeks to benefit from various infrastructure projects.
It is of course no massive surprise that the NIC massively support HS2, as the originator of HS2, Lord Andrew Adonis, was hair of the NIC. and this seems to be the standard way these things operate. One of the things that has been said about HS2 since Adonis first proposed it, is that it won’t work without Crossrail 2 to disperse passengers at Euston. Whilst that depends on believing the grossly-inflated passenger forecasts for HS2, a couple of years ago, the NIC decided that Crossrail 2 should go ahead as soon as possible and would certainly be value for money, which oddly enough is exactly what Adonis said back when he was chair of the London First‘s task force to champion Crossrail 2. Just a fortnight after the NIC published a report demanding CR2 should be fully funded in May 2016, Adonis was appointed chair of Crossrail 2, still holding his post as ‘independent’ chair of the NIC.
So let’s get that straight. You work for a group lobbying for a project, you then get put in charge of an ‘independent’ Government body which takes up lobbying for that project, and then . The Government then put you in charge of that project. This is the sort of conflict of interest that seems to be standard when it comes to UK infrastructure projects, but the more insidious problem we have seen with HS2 is when ‘conflict of interests’ involves ‘vested interests’, and the NIC board shows this issue is endemic.
NIC Board member Sir John Armitt is one of those supporting HS2, and well he might as Siemens, which he is also on the board of have been lobbying for HS2 since the start and of course have just bid to build the trains. He’s also chair of National Express, who hope to benefit with the extension to the Nottingham tram that HS2 demands.
Then there is NIC board member Bridget Rosewell, who is also on the HS2 Economic Advisory Panel. That body isn’t so much of an ‘advisory’ panel as a ‘promotional’ one, so it’s a good job she’s a founder of Volterra, who’ve been paid to come up with reports that invent economic benefits of HS2. Most notably, Volterra were paid to peer review the infamous KPMG assessment of the regional impacts of HS2, which every single independent economist (the ones who hadn’t been paid by HS2 Ltd to say what they wanted them to say) saying this report was basically made up, was based on unsafe methodology and grossly overstated economic benefits.
Rosewells’ C.V. boasts the fact she was chair of the audit and risk committee at Network Rail while their debt ballooned to £30,000,000,000, and she chaired the audit committee of the Britannia Building Society, right up until the point when it had to be rescued by the Co-operative Bank. Just the sort of person who the NIC absolutely will need as the remuneration lead on their Audit & Risk Assurance Committee…
These, along with Sadie Morgan who is on one of the HS2 committees along with the NIC board are just examples of how HS2, one of the projects the NIC champion, are ever-so-well represented within the NICs’ ‘independent’ board. Widen it out at the vested interests become far easier to spot. Our favourite has to be that the Americans have widened out the slogan of the Revolutionary War, achieving representation without taxation, in having tax-dodging Googles’ Demis Hassabis on the NIC board so her can recommend where billions in tax they didn’t really contribute to can be spent to benefit them. No wonder Google dropped the ‘Don’t be evil’ motto!
A senior Conservative source said it was disappointing to see “someone of Lord Adonis’s experience making completely inaccurate statements based on a lack of knowledge of the facts”. (Where has this man had his head and ears?????? MPT)
With this In Mind - Read On!
Public Accounts Committee.
We now hear many calls for renationalisation of the railways. Yes, most of the routes franchised are under private operation, but do they have control over their destinies?
Unless, I am very much mistaken politicians and government interference are rife. When it comes down to it, the government holds the purse strings and controls what goes on while the “independent company” of Network Rail Ltd owns and runs the whole show, for those who live a sheltered life, Network Rail Ltd is a company wholly owned by the government. Given this information and having seen the on/off plans which are wasting
Millions of pounds of tax payers money despite some of the projects being really worth while, the gross expenditure on HS2 continues as the bill rises and those in charge feather their own nests on a project which is a waste of time and money, I would say that despite all fanfares regarding independence and privatisation of the railways our rail system remains firmly in government hands and to all intents and purposes is still at heart a nationalised industry
Moving on to my pet hate it would appear that The Public Accounts Committee may be doing proper job suddenly. During one session accusations that were “elements of fraud’ when it became clear that a direct email instruction from a senior Department for Transport official had been ignored by the Chief Executive of HS2 Ltd.
The Public Accounts Committee were taking evidence from HS2 and Dft senior officials on HS2 Ltd accounts, specifically overpayments made to staff which were outside their contracts and had specifically been forbidden by the Department for Transport. The National Audit Office review of HS2’s accounts where it turned out that made redundancy payments of £2.76m in the last financial year, £1.76m of which compromised of “unapproved enhancements”, which had been expressly forbidden by Transport Secretary Chris Grayling. HS2 Ltd got around rules which cap redundancy payments to civil servants at £95,000 by allowing those leaving HS2 Ltd to go on paid ‘gardening leave’, on full pay after they had effectively left the organisation, with some staff receiving as much as £200,000.
The witnesses were Bernadette Kelly, Permanent Secretary, Department for Transport, Steve Allen, Chief Financial Officer, HS2 Ltd, and Mark Thurston, Chief Executive, HS2 Ltd. The Chair of the committee as Meg Hillier (Hackney South and Shoreditch). The first thing the committee asked about was Steve Allen’s departure. He told the committee he had resigned after a second report audit report looking at the excess payments. Early questioning outlined the facts of the case:
Geoffrey Clifton-Brown (Cotswolds): Moving on from the Chair’s question, can we just establish the facts? Under a redundancy scheme on enhanced terms, without receiving authority as required by your framework document—the Department’s framework document with HS2—commitments were made to 94 individuals, totalling £2.76 million, and in the C&AG’s estimate this was a whacking £1.7 million in excess of the amounts payable on the statutory rates that were authorised by the Department. Do you accept those figures, Mr Thurston?
Mark Thurston: Yes, I recognise those numbers.
Geoffrey Clifton-Brown: So £1.76 million of taxpayers’ money has been paid out on an unauthorised basis and, as we heard from the Chair’s question, cannot be recovered. Is that correct?
Mark Thurston: That is correct.
Chair: Can I just interject? We know that a colleague of ours—the right hon. Cheryl Gillan—has been tabling parliamentary questions and, in an amazing coincidence, she received answers to those questions at five minutes past four this afternoon, while we were in session. Why has this information not been in the public domain before, Ms Kelly?
Further questioning established that there had been discussions between HS2 Ltd, who had been pushing to be allowed to make payments in excess of their agreements, and the