Speeches by Davies.

“The jungle awaits the Minister, clearly. My right hon. Friend is absolutely right; in fact, the OBR has clearly demonstrated in its analysis that 76% of this tax increase will be passed on to working people. That is a manifesto breach if ever I saw one. Not only that—the Institute for Fiscal Studies has made clear that…”

“It is a great pleasure to see you in the Chair, Dr Huq. It is also a great pleasure to see the Minister. It has been so long since we last saw each other—it must be at least two hours. I am grateful to the Minister for laying these statutory instruments, which will revoke the double taxation conventions with Belarus an…”

“The Chancellor has lauded the new National Wealth Fund as a key part of the Government’s regional growth ambitions. The trouble is, it is not actually new; it is just the UK Infrastructure Bank with a new colour scheme and £7 billion it did not need. The Prime Minister announced at a recent Labour party political confe…”

“Of course, this is auditing an industrial process rather than a set of financial statements. The reason we concluded in our report just over a year ago that we did not think that the combination of the Department and Ofgem had done enough to evaluate the effectiveness of the process for assuring the sustainability of t…”

“That is why it has been our top priority for three years. As I was saying at the start, the huge agenda for quality improvement in the audit industry over the last few years, driven by the regulator in response to the scandals in Carillion and other audited entities, has completely transformed the way these audits are …”

“My core role is to make sure that Parliament and the public get high-quality assurance on the Government’s accounts, but also an insightful assessment of value for money in public spending. At the moment, we are dealing with three big risks to our ability to do that. One risk relates to ensuring that our quality—partic…”

“We do, yes. We have a really detailed, bottom-up operational planning process involving our teams. The information that has driven this is not a top-down set of guesses; it is detailed information about what it is taking to audit the organisations for which we are responsible. I am confident that with this budget we ca…”

“I have shared with Committee members our new five-year strategy, which takes effect from April. If I could characterise the last five years, they were essentially about getting better at what we do. That has been our focus. Clearly, while doing that, we have had to contend with pretty extraordinary events like the covi…”

“We are quite unusual in doing the full range of financial statements audits that we do. Quite a lot of our equivalents in other organisations contract out all their financial audit work to the private sector and do not do any. We think we are unique in being externally regulated by the same regulator as the private sec…”

“We are getting more information all the time about the creation of new bodies. Often we know that they are coming, but it is a question of which year there will be a first set of accounts that require audit. It is also the ones that already exist that are coming from the private sector inside the public sector boundary…”

“At the moment, we think this is the best we can estimate. We are not doing this knowing full well that we will have to come back later in the year. It is always a possibility, though, so we can never rule it out. I guess that is what the process is for—things that you could not have predicted at this time of the year, …”

“Well, we are doing. This is not more staff to do the same work; this is more staff because, crucially, we are having to take on a higher workload. The question is: what are we doing to improve our productivity almost regardless of the volume of that work? That is where the investment I was talking about in our IT capab…”

“One of the areas we have not talked about yet is that we are insourcing a degree of the work that we have previously outsourced to the firms. That will mean a headcount increase for us, but lower costs than would otherwise have been the case. That is particularly the case for whole audits where there is not a high leve…”

“Yes. I might bring in my colleagues on this, but this is why we do relatively little of the in-house employment of specialists who are not auditors. The areas where we need this kind of advice are valuations, for example, and surveyor expertise. We also need actuarial advice from qualified actuaries, and we need financ…”

“We used a lot of benchmarking of turnover levels and pay levels compared with our competitors. A very relevant factor this year is that, as you can see from the timing of our estimate, we always have to estimate and agree the pay award earlier than the civil service. Last year our pay award to our staff was 3% and then…”

“We are certainly going to bear data quality in mind—but, absolutely. We have good relationships with our equivalents in other countries, particularly other developed nations with similar challenges around their public services. We are going to use those relationships to maximise the quality of the comparisons we can br…”

“Yes, we have certainly picked up the Committee’s interest in us doing more of that. We have been working on it ourselves. We are going to make more intensive use of the OECD data, always checking the data quality as we do that, of course. Recently, we used some OECD data, and we spotted that the UK data had been submit…”

“Million. We are not that big. The other part where we have seen cost pressure is the specialist advice that we have to buy—what I was just describing was the valuation advice and financial instruments advice—and the audits we are doing right now require significant amounts of that specialist advice—for example, when we…”

“There are two large areas where we spend money on the audit firms. One is outsourcing whole audits, and that is the bit we are reducing over the next two or three years. That process, as I said, would deliver about £1.4 million-worth of savings, compared with what it would cost if we carried on using them.”

“No, it is our proposal. It is subject to approval by you and the Public Accounts Commission, but it is our recommendation, based on the benchmarking that I was describing.”