May I strongly identify myself with the tributes to you, Mr. Speaker, that the Prime Minister has led today? I know that hon. Members on both sides of the House will want to have the opportunity to pay tribute to you. As Leader of the House, I shall make sure that an occasion is arranged before you leave the Chair so that we can all pay tribute to your generous and courteous chairing of this House of Commons.

With permission, Mr. Speaker, and following on from your statement to the House yesterday, I should like to make a statement on the decisions made yesterday at the meeting of the Members Estimate Committee that you convened with the Prime Minister, the party leaders and the Chair of the Committee on Members’ Allowances, and on the Prime Minister’s proposals for a new parliamentary standards authority.

First, I want to set out how we are dealing with the past. At the meeting last night, we agreed a process, proposed by the Committee on Members’ Allowances, that will reassess Members’ claims over the past four years and identify those claims that should not have been made and should not have been paid out because they were outwith the rules. We also agreed to make arrangements for repayment. The public are entitled to see a process of reparation and Members are entitled to know that this will be orderly and fair.

Secondly, I want to set out the immediate steps that will be taken. The House has already voted to ensure that the threshold for receipts has gone down from £25 to zero and to introduce full-scope audit under the National Audit Office. But, in addition, the MEC meeting last night agreed to an immediate ban on claims for furniture, a cap on interest payments for accommodation at the equivalent per year of £1,250 per month and a restriction on any changes to designation of main and second homes. The meeting also agreed that Members who are married or living together as partners should be prevented from claiming more than one second home allowance.

I understand that the MEC will meet later today to determine detailed changes to the Green Book to put into practice the principles on which the party leaders and the MEC reached clear agreement last night. That should give immediate reassurance to Members of this House and to the public, but, in order fully to restore public trust and confidence, we need more than reparation and reassurance: we need renewal, and to put in place a new system on a new footing.

The House has already voted, on 30 April, to endorse the inquiry by the Committee on Standards in Public Life, which will come forward with its recommendations later this year. Once again, I want to place on record my thanks to Sir Christopher Kelly and his committee for their work.

At the MEC meeting last night, all parties agreed to the Prime Minister’s proposal that the keystone for any reform must be to switch from self-regulation to independent external regulation. We agreed that we should end the gentlemen’s club approach that means that we set and enforce our own rules, and instead bring forward proposals for a new parliamentary standards authority.

The proposal on which we seek to consult would see Parliament legislate to delegate specific responsibilities to a new, independent parliamentary standards authority, which would revise and update the codes of practice for Members of this House, investigate complaints where a Member of this House is alleged to have breached the code of conduct, take forward the implementation of the recommendations of the Committee on Standards in Public Life on allowances and take responsibility for authorising claims for payment under the new allowance system. It would be able not only to disallow claims, but to require payback of claims wrongly paid out and to impose financial penalties.

It is clearly appropriate that the new body should also take responsibility for such issues in the Lords, including administering and regulating the systems for peers’ allowances, overseeing the code governing peers’ conduct and the Register of Lords’ Interests, ensuring high standards of propriety and financial conduct, investigating alleged abuses of the system and recommending any necessary sanctions.

We in this House recognise that the principle of self-regulation operates differently in the House of Lords. It is clear that extensive work and consultation will be necessary to ensure the agreement of the House of Lords to the effective transfer of responsibilities to the new body.

The new authority would also maintain the register of Members’ financial interests in this House and deal with the disclosure of second incomes. Discipline issues that might require sanctions such as suspension from the House, which would have a bearing on Members’ ability to perform their work, would remain a matter for the whole House through the Standards and Privileges Committee. Only the electorate, or those who are themselves democratically elected, should be able to prevent a Member from doing their work in this House.

We have set in place the actions for reparation and reassurance. For renewal for the future, we look forward to Sir Christopher Kelly’s proposals, and we further propose that the House move from a system of self-regulation to a system of statutory regulation. Although I know that it is hard to get a hearing on this subject now, as Leader of the House I will continue to argue, both inside and outside the House, that most honourable Members are precisely that: they are people who come into Parliament as a matter of public service, and are hard-working, decent and honest. However, we must recognise that, even before the allowance revelations, there was a problem of public disengagement and public cynicism, and a public sense of distance from Parliament.

We must now seize the opportunity to promote a debate that will see proposals to change and strengthen our democracy move from the margins to centre stage, where they ought rightly to be. Parliament and politics are important precisely because there are deeply held, different views about public policy, but there is consensus among all parties that we need to put the reputation of Parliament above reproach, and we will. I commend the statement to the House.

I thank the Leader of the House for her statement. May I also thank you, Mr. Speaker, for convening yesterday’s meeting with all the party leaders? Such a meeting could have taken place weeks ago without the need for your involvement, but the House and those who elect us will be grateful for the way in which you made it happen.

Following the uproar of the past couple of weeks, we have at last taken concrete steps to address some of the unacceptable elements of an allowances system for Members that has attracted universal condemnation. Last night, we learned from you, Mr. Speaker, of the main points that were decided, and they go a long way to addressing the issues that were crying out for attention. My right hon. Friend the Leader of the Opposition last week outlined a clear list of what he wanted to see for all of us, which he has insisted on for his party. Yesterday’s announcement was in many ways the same as that list.

We will have, straight away, a strict regime to ban the flipping of homes just to exploit the allowances available. Capital gains tax cannot be evaded. A declaration about where one’s home is will have to be open and clear. People will not be allowed to claim for plasma TVs or furniture, and there will be an annual cap on how much can be claimed for mortgage interest or rent. Will the Leader of the House confirm when she expects those revised rules to be up and running?

The very fact that the proposals were endorsed by all parties, and the fact that the meeting took clear, practical action, should be welcomed by all who have so disapproved of the system under which we have been working. Will the right hon. and learned Lady confirm that it is the Government’s continuing wish to proceed in everything that we are going to do in a genuinely cross-party way?

In the meantime, Sir Christopher Kelly and his committee are working on recommendations for a long-term solution to the pay and conditions of MPs. In the middle of what can only be described as the most serious and revolutionary shift in popular opinion and in the reputation of Parliament in our lifetime, his committee is required to stand back from the fray and set out how a modern Parliament should look, and how it and its Members should be resourced. This is no easy task, and whatever people think of Parliament, I hope they will fully respect the integrity of his committee’s efforts and show proper respect for his conclusions. May I ask, therefore, when the Leader of the House thinks the committee will eventually report?

One massive structural shift that we in this Parliament must embrace if it is not to sink further in the eyes of voters is to relinquish the right to determine how we reward ourselves. We are here to legislate, to scrutinise, to discuss and to govern. We are here to represent the interests of our constituents, not to serve our own. For a long time, the Conservative party’s policy has been to give up setting our own pay and allowances and to give that power to an outside body. Some sort of outside structure is long overdue. We also want to cut the cost of politics. Where in the reforms does the right hon. and learned Lady believe that that might yet be achieved?

Behind all this is the need for massive parliamentary reform to bring this institution up to the requirements of the 21st century. May I therefore offer the co-operation of the official Opposition in proceeding constructively and responsibly to try to sort out this near constitutional crisis thoroughly and as soon as possible?

I thank the hon. Gentleman for the way he responded to the statement. He suggested that we work in a cross-party way, and I know that he is not just saying that. He means it in practice, and ever since he has been shadow Leader of the House we have been able to work together on a proper cross-party basis. We know that when we are looking for solutions to these issues, no party has a monopoly of wisdom, and when it comes to unearthing the problems, no party has a monopoly of virtue either, so we will work together across the House to sort them out.

I agree that we owe a great deal to Sir Christopher Kelly and his Committee on Standards in Public Life. He has said that he will report later this year. To respect the independence of his committee’s work, although we have asked the committee to work as expeditiously as it can to make its report so that we can adopt its proposals, it cannot be for us to set out the time scale. The committee must go through the processes as it sees fit.

That is why it was important that the MEC yesterday—you convened it, Mr. Speaker—set in place interim measures. The shadow Leader of the House asked when those interim measures will be up and running. He and I, along with other members of the MEC, will meet later this afternoon. These transitional measures need to be up and running straight away, as soon as the detailed rules can be put together, which will not take long at all.

I welcome my right hon. and learned Friend’s statement. I also thank you, Mr. Speaker, for taking the initiative of calling together the MEC and all the party leaders—all the party leaders—yesterday. You invited me to attend the meeting as Chairman of the Committee on Members’ Allowances, and I was very pleased that the meeting accepted all the recommendations from my Committee, added to your own proposals. That was the basis for your statement last night.

On the consultation on the proposed parliamentary standards authority, I hope the Government will consult and involve the staff of the Fees Office. They have served this place very well indeed. They help us in every way possible in trying to give us information and advice. Although we may feel bruised, they, too, feel somewhat bruised at present, as I know from a meeting that I had with them yesterday. I hope that in the consultation, they, too, will be asked their views on the proposals.

I am sure that we will need to engage with the invaluable experience and information that the Fees Office has accumulated over years of work on those issues, and that its contribution to the consultation will be very important indeed. I acknowledge the work of the Committee on Members’ Allowances, which my right hon. Friend chairs. Its work paved the way for yesterday’s agreement, and a great deal of work was done in advance so that the all-party in-principle agreement could be reached. I pay tribute to him as Chair, and to all Members who serve on that Committee.

I, too, thank you, Mr. Speaker, for convening the meeting yesterday and for getting some overdue consequences from it. I also very much welcome the statement by the Leader of the House. I remember giving evidence to the Committee on Standards in Public Life some years ago, when I suggested that self-regulation for this place was on very flimsy foundations indeed and in imminent danger of collapse. That collapse has been all too self-evident, and the House has forfeited the right to self-regulation. Statutory regulation is now necessary, and I am pleased that the Leader of the House will now consult on that proposal.

I welcome the immediate steps that have been set out as a necessary review of what has happened over recent years. The capacity to make the adjustments must be put in place. I welcome also the announcement by the Leader of the House that the MEC will meet today, because all Members need clarity about exactly what will be required from them over the next few days and weeks and about how the system will work. Some of it is self-evident, and it does not take a genius to realise that Members should stop buying household goods and stop some of the most egregious excesses and abuses that have come to light. However, there are other areas where Members will need guidance, so I enter one note of caution.

I am worried that we may have inadvertently introduced a perverse incentive against Members renting accommodation and in favour of them entering into mortgage arrangements. That cannot be what the House intends or what the general public want, so I ask the Leader of the House to look carefully at that issue.

I now look forward, as we all do, to the results of the deliberations of Sir Christopher Kelly’s committee. I hope that they will be timely, thorough and give us the answers that we and the public want, and I hope that the House will be able to accept them without equivocation, so that we have a firm foundation for the future.

Finally, I echo what was said earlier by my right hon. Friend the Member for Sheffield, Hallam (Mr. Clegg) and what was referred to in the right hon. and learned Lady’s statement: the matter now goes well beyond expenses. It is about the reform of Parliament and the political system, making the House work in a way that it has not done over recent years.

Even this week, we have had the spectacle of a guillotine motion preventing proper debate of an important Bill. We cannot go on like this. This House must be able to hold the Executive to account properly and do its work properly. We need renewal of the whole political system. More papers and more proposals will not do that: action will, and it is overdue.

The hon. Gentleman said that he, like all Members from all parts of the House, wants to contribute to the consultation and approach it on a cross-party basis, and he reminded the House that, some years ago, he proposed changing self-regulation to statutory regulation. I acknowledge that there have been proposals from his party, which we have put into practice through the MEC system. Indeed, proposals from the Opposition have now been implemented, and proposals have come from Government Members, too.

The truth, however, is that this is not a competition for ideas. All ideas from all parts of the House are welcome in contributing to the process. Whatever we disagree on—we disagree strongly on different issues, which is why we stand for different parties and fight it out at elections—we all agree that we want decent rules that the whole country respects.

I did not agree with the hon. Gentleman when he talked about our “forfeiting” the right to regulate ourselves. In this day and age, the move from self-regulation, which is internal and not transparent, to public accountability and statutory regulation is the right move and a sign of strength. We are not forfeiting; this is the strong and right decision to take.

I agree with the hon. Gentleman about the issue of clarity. For 650-odd Members of the House of Commons, there are 650 different sets of circumstances, and each Member will need to know how the new rules apply to their circumstances and how they can make their arrangements. The MEC will have very much in mind the need for clarity and swiftness in showing how the rules are going to work, so that Members can work out how they apply to them. He has already made that point to me, earlier today, and he is absolutely right to have raised it.

The hon. Gentleman and the shadow Leader of the House also raised a point that has been made by a number of Labour Members. We must be aware that some people’s rental agreements include services, utilities, service charges and suchlike; we must not have a perverse incentive that would help Members who have already bought their properties or encourage Members to buy properties rather than rent. We need a fair system that covers the different sorts of accommodation that Members use. The MEC will be mindful of that when we meet this afternoon to work out how we should put into practice the very important cap on accommodation expenses.

The hon. Member for Somerton and Frome (Mr. Heath) said that we need to reconnect with the public and that we need reform of Parliament. I agree; we must all work together on those wider issues, as well as sorting out the immediate issues.

I welcome my right hon. and learned Friend’s statement. I have been a member of the House of Commons Commission for 10 years, nine of them under your stewardship, Mr. Speaker. It was never you who was opposed to reform; the House of Commons showed total incapacity to grasp the nettle of accepting that reform was needed—never more so than on 3 July last year, when proposals that might well have avoided many of today’s scandals were rejected by the collective will of the House.

That, however, is the past. The future is absolutely in independent regulation, and again I welcome my right hon. and learned Friend’s statement. I also welcome the fact that it extends to the House of Lords. I break with tradition by calling it that rather than “the other place”. That might be a welcome change in our own proceedings.

In the past, the House of Lords has been jealous of its own prerogatives and has avoided integration with this House. I ask my right hon. and learned Friend to be sure that the broad bipartisan support here will be reflected in the House of Lords and that that House will not be an impediment to the kind of changes that we seek.

I know that many Members of the House of Lords themselves want to put the situation on a proper footing; indeed, that work was already under way. I take this opportunity to pay tribute to my hon. Friend’s work on the MEC. He has been a member of it for many years, and he has done a good job on behalf of the House in explaining to the public at large our strong belief that there should be a constituency link.

One of the reasons we have second home allowances is that Parliament holds in high regard the importance of Members being rooted in their constituencies. My hon. Friend has been able to explain that on television. He has also explained that we do not want a millionaires’ Parliament in which people become MPs only if they can afford it. Every time I switch on the telly and see him rather than me, it is a great relief.

The right hon. and learned Lady’s statement raises important constitutional and ethical issues, which will need to be teased out during the consultation. May I press her on one point? The two driving principles are transparency and independence. To achieve those principles, the case is made to move from self-regulation to independent regulation. It is proposed that the new authority should investigate complaints when a Member is alleged to have breached the code of conduct, but why did the Government stop there? What about the ministerial code of conduct? Is there not an equal need for independence and transparency in investigations of complaints of that code having been breached?

The Prime Minister has appointed Sir Philip Mawer to be independent in the reviewing of adherence to the ministerial code, and that is kept constantly under review. The right hon. Gentleman is correct in saying that ministerial standards are also part of the wider discussion that we need to have.

I do not want to look as if I am trying to ingratiate myself—far from it; it is far too late for that—but I do pay tribute to the right hon. Gentleman’s work as Chair of the Standards and Privileges Committee. We do not find demonstrations up and down the land chanting, “What do we want? The Standards and Privileges Committee! When do we want it? Now!” None the less, it does important work, and I pay tribute to him and all Members who serve on it.

I welcome my right hon. and learned Friend’s statement. May I move on to the Standards and Privileges Committee? It looks as if it will have an adjudication role beyond what will happen with the other authority. Is she completely happy that this adjudicating body is made up of just 10 members of our profession? In what other regulatory body for which we pass legislation would we allow a profession to sit on its own as an adjudication panel over itself? Does she think that some lay members should also join members of our profession on the Standards and Privileges Committee?

That is an interesting suggestion, which my right hon. Friend could make as part of the consultation. No doubt he will have to consult the Chair of the Committee as part of that.

May I start by saying that you, Mr. Speaker, have always been extremely fair to the Scottish, Welsh and Northern Irish parties in the House? We thank you for that.

Ending self-regulation in the House of Commons must be a priority. As I said at the leaders’ meeting yesterday, it is right for us to examine proposals for a parliamentary standards authority. Will the Leader of the House confirm today that the commitment to transparency that Mr. Speaker outlined in his statement on expenses yesterday evening will match the standards of the Scottish Parliament?

Certainly, I think that even more transparency and openness apply to our system than at the moment obtain in a rather different system of transparency in Scotland. We are all committed to transparency. I should tell the House that the consultation on the parliamentary standards authority will be taken forward by my right hon. Friend the Secretary of State for Justice.

Does this statement mean that from here on in, Members of Parliament will not take part in votes to increase their allowances or anything else? I fervently believe that this is a better day for Parliament. On one of the days when we had a debate on increasing the allowances by a considerable amount, some of us voted against, and some of us did not take the money either, but I believe that that was a bad day for Parliament, and I want to see the back of those days.

If there is to be regulation by other bodies, we should have assurances that never again will we have the business of allowances being put to free votes. Incidentally, to get the record straight, I should say that Mr. Speaker never cast a vote. Those free votes allowed people to increase their allowances by a massive amount, and we need to put an end to that. Do we have an assurance that it is all over, and that there will be no more free votes on allowances and pay?

All of us have felt that it is not right that we should have to vote on our own pay and allowances. Every time we have to come to the House to debate our own pay and allowances, we have all felt that it is not right. We do not want to have to do that any more; we addressed the issue on pay, and we need to do that on allowances as well. I agree with my hon. Friend that we need to ensure that we cut costs overall. That is also important.

I should also say that it is important not only that Members are able to be rooted in their constituencies—that important constituency link must be maintained—but that we have offices that help us to do our work professionally in responding to our constituents.

I receive many thousands of e-mails and phone calls from constituents. My office team do a very important job in keeping me in touch with my constituents and helping them when they have individual problems. Yes, we have to sort this matter out, but we have to do it on a set of principles, bearing in mind the importance of a professional office and a second home, and the importance of not having a millionaires’ Parliament. I agree with all the other things that my hon. Friend said as well.

Does the Leader of the House agree that although profound reform is necessary, a sovereign Parliament must think very carefully before setting up an independent external body to set and enforce the rules and to regulate Parliament itself, particularly as it is not at all clear from her statement to whom that external body will be accountable? Does she agree that all of us here, individually and collectively, are responsible to the electors for our actions, and that although we must take external advice, the essential decisions on regulation and rule setting must be taken by ourselves, not subcontracted to others?

The question of conduct within this Chamber will remain a matter for the Speaker, and I am sure that people would agree that that is rightly the case. The question of suspension from this House must remain a matter for those of us who are democratically elected, not an unelected body. While it is right to delegate to a statutory authority the questions of setting the code of conduct, setting pay levels, setting allowances, administering the system and investigating any problems, the only thing that should come between us and our doing our duty as Members of Parliament in this House is either our constituents removing us at a general election or the House removing us, with democratically elected Members taking that action.

Sometimes it takes a big crisis to produce a big response. We have certainly had a big crisis, and I think that now we have had a big response, which is to be welcomed. It is being proposed today that we set up a new body. Can the Leader of the House tell us which bodies will be abolished as the new one is established, and how the members of the new parliamentary standards authority will be appointed?

The responsibility of some existing bodies will change, and the responsibility of some others will be subsumed within the new authority. All these issues are a matter for consultation, which, as I said, will be led by my right hon. Friend the Secretary of State for Justice. My hon. Friend is absolutely right that a crisis can evoke a positive response. I pay tribute to him for his work on the Public Administration Committee. Perhaps I owe him an apology, because when we were in the lift I described him as an intellectual, and he rejected that. However, he has thought about these issues long and hard, and now that they are out of the shadows, we need his intellectuality to be brought to bear on them.

May I say, Mr. Speaker, on behalf of my right hon. and hon. Friends, how much we appreciate the kindness, fairness and courtesy that you have shown to us from the Chair?

I thank the Leader of the House for her comments. Can she clarify whether the body setting Members’ allowances will be totally independent as regards Members of this House?

Yes, it will. I look forward to the participation of the hon. Gentleman and his hon. Friends on this issue as well.

I welcome the statement made by the Leader of the House. Does she agree that it would be wrong for this House to deflect blame for the current crisis on expenses on to ordinary members of the Fees Office on average salaries, many of whom have served this House with great dedication for many years? There may be questions to ask at the very top of the Fees Office, but the ordinary staff are not responsible for the culture around expenses that has flourished for too long. Just as it is wrong for Members of the House to think that they can hide behind the outgoing Speaker, it would be wrong for them to think that they can hide behind individual, averagely paid members of the Fees Office. The deserved disrepute into which our system of expenses has sunk is the responsibility of each and every one of us as Members of the House.

I agree with my hon. Friend that it would be not only fruitless but wrong to seek to apportion blame anywhere. What we need to do is take responsibility and to sort this out. That is the responsibility of all Members of this House, even those who have been absolutely blameless, as I am sure the majority have been, in the way they have made their claims.

The Leader of the House spoke of reform of the expenses system as being only one part of trying to restore people’s faith in politics and re-engage them in the political process. She referred to having a debate to discuss other opportunities for tackling this issue. The Local Democracy, Economic Development and Construction Bill will come to this House after the recess. Will she take advantage of that by ensuring that amendments are tabled to help to re-engage people with politics right from the bottom up?

As the hon. Lady will know, there are already provisions in the Bill to do that, but I am sure that as it proceeds through the House there will be further such opportunities.

What did the Members Estimate Committee take into consideration when it arrived at the figure of £1,250 per month as a cap for mortgage interest? That is not for the whole mortgage; it is just to cover the interest. It strikes me that a person would have to be very rich indeed to be able to claim that maximum amount and arrange their finances to benefit from it to the maximum extent. I think that the public will find that very curious indeed. Does my right hon. and learned Friend agree that we need to look at that issue, and perhaps at ending a system that allows people to profit from buying and selling houses that have been paid for at public expense?

That figure was decided yesterday at the Members Estimate Committee meeting, the Committee on Members’ Allowances having looked at the average among different Members so that we could ensure that we lowered the amount, but we did that in the knowledge of the current situation for Members with regard to their obligations.

There is a particular issue for Members who entered the House in 2005 and had to take out quite big mortgages in order to find accommodation, because the property market was absolutely at its height, and who now find themselves with properties that they cannot put on the market. The intention was to get a situation that reduced the amount that could be spent on the mortgage but also recognised the circumstances of those who have recently come into the House.

May I pay my own personal tribute to you, Mr. Speaker, for your great personal kindness? I have been most appreciative and wish you the very best for the future.

I welcome the acknowledgement by the Leader of the House of the difficulties faced by Members from the new intake, and her acknowledgement of the fact that most Members deal with their expenses in an honest and straightforward way—that needs to be said, and I was pleased that she did so. I welcome the recognition of the need for change. I am particularly pleased with the idea that we should be regulated by an outside body, as I have been asking for that during the whole time that I have been in this House. However, some people have been caught out by the regulations announced yesterday, through no fault of their own, and are quite worried about the situation. Will the Leader of the House consider having an appeals process in the short term to allow those people to put their concerns and have them properly adjudged on the facts?

The Members Estimate Committee has tried to take into account as many circumstances as we possibly can. However, I assure the hon. Gentleman and other hon. Members of two things. First, we will ensure that the rules are as clear as possible so that people are not unsure about how their circumstances will be changed as a result of the “in principle” decision that was made yesterday. Secondly, this is only an interim arrangement until such time as Sir Christopher Kelly brings forward his proposals. We will try to make the position as clear as possible immediately, and it applies only for a limited period. I hope that that will reassure Members.

I totally agree with one of the final points in my right hon. and learned Friend’s statement: we have a once-in-a-lifetime opportunity to do the right thing and ensure that those people who have been disengaged from the whole democratic process are now properly engaged. For many people, the exposure of the allowances has been a sad confirmation of what they have always believed. How can we use the establishment of the standards authority to ensure that the people whom we are supposed to be representing can have their views heard? They have very strong opinions on this matter.

This is a question for all Members in all constituencies. My hon. Friend has often raised in the House the particular issue of the disengagement of young people. One important thing that we have done is agree that the Youth Parliament should come and sit in this House. The engagement of the UK Youth Parliament, whose members are themselves elected in all parts of the country, often on a bigger turnout than most of us, has a major role to play.

I welcome these long-overdue interim measures, but does the Leader of the House plan to make the House authorities the employer of MPs’ staff and to limit MPs’ second jobs? Then she will have implemented all the recommendations that have been listed in the early-day motions that I have tabled over recent years.

When it comes to second jobs, I very much agree with what the hon. Gentleman says. There are two issues to consider about remunerated work done by an MP for which they are paid outside this House and which has nothing to do with the House. One is whether it causes them a conflict of interest, and the second is whether it takes their mind off what their proper job should be, which is to represent their constituents or be in government. I very much agree with him on that matter. Sir Christopher Kelly’s committee will be looking at it, and I think that the hon. Gentleman and I will be very much on the same side of the argument. Let us hope that we prevail on that one.

The House has already voted on asking the Members Estimate Committee to look into the employment of staff, and that will be part of the wider discussion.

I welcome my right hon. and learned Friend’s statement. She was right to remind all of us that we have a joint responsibility to restore public confidence in this House, and indeed in politics. Does she agree that in a free and democratic country with a free press, the press also have a responsibility to scrutinise and report accurately what happens in this House, and that those in the press and media who seek to abuse the facilities to indulge in personal and at times racist attacks are acting irresponsibly and not playing their part in restoring confidence in the political system?

All of us in this country who are democrats want to be sure of two things: that our parliamentary democracy is as strong and confident as it can be, and that the public recognise that to be the case. I recognise that my hon. Friend has not only been a Member of this House for a considerable time but was involved in representations in the trade union movement before that.

I thank you, Mr. Speaker, for your hospitality to me during my time in the House.

I thank the Leader of the House for her statement, but there are two precise issues that I should like her to elaborate on. First, will the cap on interest payments for accommodation at £1,250 per month also apply to rental costs at the same amount? Secondly, she indicated that the restriction would prevent two Members who are married or living together as partners from claiming more than one second home allowance. Will that apply also to any other two Members who may wish to avail themselves of a property in London to try to ensure that they get additional payments?

I think that the intention behind the MEC decision was to distinguish between hon. Members who are married or civil partners and those who are just good friends sharing. That might not always be easy to establish, but what we are talking about is marriage and civil partnerships, not one-night stands.

May I help the hon. Gentleman by running through the list of what is allowed? You, Mr. Speaker, set forth yesterday in outline what will be allowed for rent, ground rent, service charges, council tax and utility bills, but there will need to be clarification in writing so that hon. Members can be absolutely clear about what their circumstances are. That will be made clear following the MEC meeting this afternoon.

I entirely endorse the comments of my hon. Friend the Member for North-East Derbyshire (Natascha Engel) about the need to restore people’s confidence and faith in the political system, and in some cases to create that confidence and faith in the first instance. One suggestion is that we should move to real-time month-by-month publication of claims, if not when they are submitted then at least when they are approved. Is that under active consideration?

That was one of the things that was agreed last time—that there should be publication month by month of claims that have been made and allowed—but obviously we are looking all the time at how we can improve transparency. These things will not be set in stone, and any other suggestions that hon. Members have will be—[Interruption.] I have just been told by my deputy that it will be reported quarterly, not monthly, and I take it that my hon. Friend the Member for Bristol, East (Kerry McCarthy) is suggesting that we do it more frequently.

I welcome today’s statement. Does the right hon. and learned Lady agree that if it is really our intention to have here a legislature that is broadly reflective of the people whom we seek to represent, it must be made clear and taken into consideration that this is not a gentlemen’s club, and that many Members have to balance their parliamentary and constituency duties with their family duties? That applies not only to those of us who are mothers of small children but to those with other family duties.

It has been very upsetting to read in the press the great idea that we could all live in barracks in London. I ask the House to take into consideration where we will put our children and when we will have time to see them. If we want to have a legislature that really reflects the people, it must reflect families. The financial arrangements must therefore reflect the need for some of us to undertake family duties as well as parliamentary and constituency duties.

The hon. Lady has added another principle to the list that I suggest we all adhere to. We must not just be a millionaires’ Parliament, and we must respect the constituency link and have good professional offices. Also, this should not just be a Parliament of single people who either have never had families or whose families have grown up. The insight that hon. Members bring of struggling to balance work and family responsibilities, and of caring for older relatives and younger children, helps to shape public policy and helps us understand the lives of people in this country. I would definitely adopt the principle that she has put forward.

It is not just the expenses scandal that has tarnished the reputation of this House in what has been a low, dishonest decade for parliamentary democracy, but the deception perpetrated by the previous Prime Minister in taking us to war on the basis of a pack of lies. That caused almost irreparable damage to people’s trust in politics and politicians.

My question to the right hon. and learned Lady is this: will the standard of honesty form part of the remit of the new parliamentary standards authority, so that members of the public can refer for independent investigation cases in which they believe there is evidence that Members of Parliament, including Ministers, have misled this House and misled the country?

rose—

Order. There are only a few hon. Members left, and I have given a lot of leeway, particularly in this matter, but it really should just be a supplementary question that is asked. I ask the remaining Members to do that.

We are, of course, answerable to our constituents for the honesty and integrity with which we represent them and go about our work in the House, and to the Chair for not misleading other Members. I think that the regulation of our democracy is ultimately with those who elect us. We are currently considering regulating our pay and our allowances, having codes of conduct and making proposals for their enforcement; that does not cut across the basic fundamental principle of democracy.

I thank the Leader of the House for her statement and for the leadership that she has shown on this matter. Many hon. Members have made submissions to Sir Christopher Kelly. Will the Government accept his recommendations, whatever they are?

At the meeting that the Speaker convened yesterday, the view of the party leaders was that it would be best for the House and all concerned if we could agree with as much as possible of what Sir Christopher Kelly proposes. I think that the Leader of the Opposition said on television that we want to agree with 99.9 per cent. of what Sir Christopher Kelly suggests. That is not to seek to allow for wriggle room. It is in the right spirit and all our interests if we all give evidence to Sir Christopher Kelly—the deadline is 5 June. It is important for hon. Members to give evidence for him to consider. A great deal of responsibility rests on him because we want, cross party, to adopt what he recommends, which will then be put into practice by the new statutory authority. He is like the software, and the hardware will be established by statute in the new authority.

Just to round off, Members of Parliament are either elected representatives, who are free to work outside this place, or professional politicians, who are not, and are therefore entirely dependent on the taxpayer as members of a political class, separate and distinct from those who elect them. What is the Government’s view?

The Prime Minister asked Sir Christopher Kelly to look into that, and he will make his recommendations. In the meantime, the House voted on 30 April for a proper register of all the remuneration from the different additional jobs that Members have. The bottom line is that the public should be able to know where Members of Parliament get additional money from. That was not the case until we made the change. We have therefore already taken steps on transparency.

I am not sure that I agree with the hon. Gentleman’s idea that we are members of the political classes. I do not regard myself as part of the political class. Indeed, many of those in the political class have long thought that I should not be in it. I am many things—I represent my constituency in Camberwell and Peckham; I am a wife, a mother, a former lawyer. We are all different things, and we should not allow ourselves to be pushed into believing that, without second jobs from which we rake in money, we are somehow unworthy members of a political class. So I think my answer to the hon. Gentleman’s question, which I cannot remember, is probably no.

On a point of order, Mr. Speaker. Once again, the Prime Minister visited my constituency last week—to deliver a speech on crime at Chelsea football club. As has been the case for every visit that he has made to Hammersmith and Fulham in the past four years, he failed to inform me as the constituency Member of Parliament. As ever, his tactic is for one of his junior Ministers to send out a fax saying that the junior Minister will come, but not mentioning the Prime Minister’s presence. The rules are clear. How can we enforce the conventions and courtesies of the House—

Order. The hon. Gentleman is trying to debate the matter. He has made his point—let me look into the problem. The purpose of points of order is not debate. Let me look at the matter; that would be best.

I beg to move,

That an humble Address be presented to Her Majesty, praying that Her Majesty will appoint Amyas Morse to the Office of Comptroller and Auditor General.

Mr. Morse has agreed that the appointment will be for a non-renewable term of 10 years. I should like to record the Government’s thanks to Mr. Tim Burr, who agreed to serve on an interim basis and recently announced his retirement, for his work and expertise.

As a first stage in implementing the recommendations of the Public Accounts Commission, a new board structure with a majority of independent non-executives, including a non-executive chair, who has already been appointed—Sir Andrew Likierman—is being established.

The Government will introduce legislation to implement the other recommendations of the Public Accounts Commission on the governance of the National Audit Office.

Mr. Morse was subject to a pre-appointment hearing before the Public Accounts Committee—the first such hearing that the Committee has held. He will be the first Comptroller and Auditor General who has extensive private as well as public sector experience, which will enable him to bring best practice and discipline to public audit work, and that will benefit the scrutiny of Government.

I believe that Mr. Morse is eminently qualified for the office of Comptroller and Auditor General, and I commend the motion to the House.

It is a pleasure to second the Prime Minister’s motion. I personally thank the Prime Minister for his role in the process, which has been completely fair and open.

The whole point of the job of Comptroller and Auditor General is that it must be above politics. For 150 years, since Mr. Gladstone founded the Public Accounts Committee, it has been a tradition that the Chairman of that Committee is drawn from the Opposition. However, there is also a well-established convention, which is now in statute, that the new Comptroller and Auditor General must be appointed by the Prime Minister—by definition, a member of the Government—and that the Chairman of the Public Accounts Committee, who is obviously a member of the Opposition, must countersign the motion. Both Government and Opposition therefore have a lock on the appointment. As far as I know, it is the only public sector appointment to which that applies.

Apart from what I have outlined, the process is new because it is 20 years since we had to appoint a permanent Comptroller and Auditor General. The last time we did it was when Baroness Thatcher, as Prime Minister, appointed Sir John Bourn. The system was old fashioned, with no open advertisement. My predecessor, Robert Sheldon, now Lord Sheldon, conducted interviews on his own, and that was clearly inappropriate. We had to create a modern structure, and we have tried to do that.

In his opening remarks, the Prime Minister alluded to the modern structure. The first step in the process was to make the National Audit Office completely open, transparent and accountable. We had to preserve the ability of the Comptroller and Auditor to be entirely responsible for his reports—nobody can influence their content. However, it was clearly wrong that he was running the National Audit Office on his own. There had to be a modern board structure and, as the Prime Minister said, the Public Accounts Commission—not the Committee, but the Commission, under the able chairmanship of the Father of the House, who is here today—devised a structure.

I headed an appointments panel, which appointed the new chairman of the National Audit Office, Sir Andrew Likierman, who has unrivalled experience. He was head of the Government Accountancy Service—apparently known in the trade as “Hot GAS”—and is the dean of the London business school. He was an outstanding candidate and now sits at the apex of this modern, open and transparent National Audit Office. This morning, the Commission met again, and we have given him the go-ahead to appoint further independent board members. The creation of an independent structure was therefore the first part of the process.

We then had to move to interviewing. Again, I thank the Prime Minister. Of course, he is far too busy running the country to sit for 25 hours, as we had to do, interviewing people, and he therefore delegated Sir Nick Macpherson, the Treasury’s permanent secretary, to sit on the interview panel, which I chaired with Tim Burr. I thank Sir Nick Macpherson, with whom I worked closely and who is an outstanding public servant, and Gus O’Donnell, Secretary to the Cabinet, for their help in the process. The process was completely open and transparent, with open advertisements, head-hunters appointed, a long list of outstanding people applying, more than 20 hours of interviews and Sir Andrew Likierman finally getting involved, and we came up with an outstanding candidate, Amyas Morse.

As the Prime Minister said in his opening remarks, Amyas Morse is, as far as I know, the first ever chartered accounted to be Comptroller and Auditor General. That is an important point in respect of when we talk about professionalising the civil service. He works in the public sector at present, having taken a huge cut in his salary to do so, but before that he rose right to the top of the accountancy profession, as the global managing partner of PricewaterhouseCoopers. It was quite obvious to all of us that he was the outstanding candidate and that is why we on the panel decided to appoint him.

Amyas Morse’s name was then put to the Prime Minister, who, again in the entirely helpful way in which he has conducted the process, approved the nomination within days. He had a veto, but he decided to trust the Committee with our decision. As the Prime Minister said, we then had the first ever confirmation hearing before the Public Accounts Committee; it is something that has never happened before. My colleagues on the Committee will confirm that Amyas Morse performed very well, with firm, well-argued answers, and the Committee clearly had confidence in him.

The whole process is extremely important. It is not just about appointing a chartered accountant or an accountant of government, and it is far more important than just bean counting or adding up the figures. The National Audit Office is at the centre of the drive to promote economy and efficiency in government. It spends £103 million a year, but it saves the best part of £900 million a year. The National Audit Office is at the centre of the process. The Public Accounts Committee could not work without the National Audit Office, headed by the independent Comptroller and Auditor General.

Whatever the faults in our Budget process or whatever Parliament’s other faults may be, it is not surprising that our process of audit is widely admired and copied throughout the world. It is not surprising that every Commonwealth country has a supreme audit body reporting to a public accounts committee, but even the Czechs have now created a public accounts committee in the past two years. They have perhaps taken to extremes the idea that their chairman—the person who will hold their Government to account—should be a member of the opposition, and have appointed a communist.

We can be very proud of the work of the Public Accounts Committee. We should thank the National Audit Office and pay tribute to Tim Burr for holding the fort for this interim period. We have appointed a man who must be completely un-influenceable by anybody. That is why we said that he will have one term for 10 years that will not be renewable. The position must also be completely independent. We have ensured his independence through the process that we have undergone. I think that Amyas Morse will be a worthy successor to Tim Burr and I commend his name to the House.

It is symbolic of the significance of the post of Comptroller and Auditor General that the announcement of his appointment should be made in the House by the Prime Minister. However, it would be fair to say that doing so is not one of the more onerous duties of a Prime Minister.

As we heard, such an announcement has been made only twice before, first in December 1987, when Margaret Thatcher announced the appointment of Sir John Bourn. I note that on that occasion the person responding from the Front Bench on behalf of the official Opposition was the right hon. Member for Newcastle upon Tyne, East and Wallsend (Mr. Brown), who is here again today. Indeed, if I remember rightly, he was also present on the second occasion, in January 2008, when the Prime Minister announced the interim appointment of Tim Burr.

Such announcements are happening slightly more frequently now, with somewhat less of a gap between them. It is not unusual in public life for one person to hold a position for a long time and for his successor’s time in office to be relatively brief. However, that is no reflection on Tim Burr’s performance, because it was always his intention to take the position for an interim period. He has had a distinguished career, working for the National Audit Office for 15 years before becoming the Comptroller and Auditor General, eight of which were spent as deputy. As we heard from my hon. Friend the Member for Gainsborough (Mr. Leigh), the Chairman of the Public Accounts Committee, Tim Burr played a useful role in the selection of his successor. I would like to thank him for his contribution over many years.

When we debated Mr. Burr’s appointment in January 2008, much of the discussion centred on the selection process. The consensus in the House was that it was important for Parliament to have a significant role in the appointment to such an important position as that of Comptroller and Auditor General. Some argued for a parliamentary vote. Others, including the Chairman of the Public Accounts Committee, argued that if that were to happen, there may be a perception of a loss of independence from the Executive. The Chairman of the Public Accounts Committee is an Opposition MP, and if he has a greater role in the appointment, the perception may be one of greater independence. That view has prevailed and the Government have accepted it. I fully acknowledge my hon. Friend’s point that both he and the Prime Minister have worked together successfully and smoothly in making this appointment. That helps with the perception of independence.

I agree with both the Prime Minister and my hon. Friend that an appointment for a single 10-year term is also helpful in maintaining independence and the perception of independence. There can be difficulties and dangers—perhaps more of perception than in reality—when someone has a shorter term and is then reappointed. For example, adverse comment was made about the delays in the reappointment of the Governor of the Bank of England. We think that the current structure has much to commend it.

In debating the appointment of Mr. Amyas Morse, it is worth highlighting how important the role of the Comptroller and Auditor General has always been and, indeed, how much more important it may become in the years ahead. We are entering a period of public spending restraint. We face record levels of borrowing and it will be necessary to ensure that public money is spent wisely, whoever is in power in the years ahead. Even the Government recognise that there is room for further efficiencies. In a period when the Government’s projections are such that there will be real-terms reductions in departmental spending in some areas, the emphasis on value for money is significant.

Hon. Members perhaps need no reminding of this, but it is worth reiterating the fact that the demand from the public for greater transparency in and scrutiny of public spending is greater than it has ever been before. The public demand to know more. We live in a less deferential society. Developments in technology make it easier for information to be disseminated and obtained. For example, the Conservative party supports the introduction of a website detailing items of significant public spending. We think that more can always be done. However, the National Audit Office, the Comptroller and Auditor General and the Public Accounts Committee all have distinguished records in scrutinising public spending, and they will continue to perform that important role. Indeed, just last night in his statement, Mr. Speaker announced a role for the Comptroller and Auditor General in examining MPs’ expenses.

Let me deal finally with the appointment of Mr. Amyas Morse. We have heard from the Chairman of the Public Accounts Committee and the Prime Minister what a distinguished career Mr. Morse has had, at PricewaterhouseCoopers and, more recently, at the Ministry of Defence. I know from speaking to my hon. Friend the Chairman how deeply impressed he was by Mr. Morse, and I know that this view was shared by the rest of the panel. Indeed, I think that Mr. Morse impressed the Public Accounts Committee as a whole when giving his evidence to it in February. I have also spoken to others who know Mr. Morse, all of whom speak very highly of him. He has an important task, and we are confident that he will perform his role with great distinction. On behalf of the official Opposition, I wish him well.

In my role as Chair of the Public Accounts Commission, may I endorse completely everything that has been said about Mr. Morse’s suitability for this job? There was an extremely good shortlist, and he was undoubtedly the best candidate. It is not surprising that it was a good list, because this is one of the most important public sector roles. Parliament would be impotent to carry out its financial scrutiny of the Government if it did not have an effective National Audit Office headed by a clearly independent and strong-minded Comptroller and Auditor General. Without the Comptroller and Auditor General, we would be incapable of monitoring the hundreds of billions of pounds of expenditure and income. He does not simply audit; he checks for value for money, probity and accuracy.

I should like to put a different hat on to describe another role of the Comptroller and Auditor General. In my role as Chair of the Liaison Committee, I have been very grateful to the previous Comptrollers and Auditors General, Sir John Bourn and Tim Burr, for all the work they have done with the Committees outside the Public Accounts Committee. For many years, the other Committees have justifiably been envious of the incredible support that the PAC receives from the National Audit Office. Sir John must be given credit for his decision to start using the NAO’s expertise to support the other Select Committees, through the use of secondees and briefings. At the post-appointment hearing, I spoke to Sir Andrew Likierman, the new chair of the NAO, which is a new post. I was particularly delighted when he and Mr. Morse reiterated their commitment to expand the role of supporting the Select Committees. That can only be good news for the Committees.

I, too, would like to thank Tim Burr. He stood in at a difficult time, and he indicated that he had no intention of applying for the post himself. I know that the Chair of the PAC will agree that he has done an excellent job in running the National Audit Office. More than that, however, he has started to implement the restructuring of the NAO and to adapt it to the best modern standards of corporate government, as recommended by the Tiner report. We owe him a lot for that.

I first started to serve on the PAC in 1990, when I left the Front Bench. At that stage, the NAO was saving the taxpayer five times its annual running costs. That gradually increased, under pressure from the Commission and the Committee, to seven, eight and then nine times the running costs. Tim Burr gave us a pleasant surprise at the last meeting of the Commission, when he told us that the NAO is now recovering 10 times its cost to the taxpayer. That works out at more than £1 billion every 18 months, which is a remarkable achievement. Tim has done a great job. He has been a pleasure to work with, and I wish him well in whatever he decides to do in the future.

It is indicative of the significance of the position of Comptroller and Auditor General that the Prime Minister himself moved the motion on the appointment of Mr. Morse. I congratulate the Prime Minister on the nerveless performance that he gave a few minutes ago.

The post of Comptroller and Auditor General is a highly significant one, particularly at this time, when the Government have a public sector deficit of £175 billion this year, falling to £173 billion next year—according to their projections. The deficit represents more than 10 per cent. of gross domestic product, so it is essential that we achieve value for money in public spending. That is clearly a task that Mr. Morse is well equipped to contribute to.

A number of concerns have been expressed, not about Mr. Morse’s individual qualifications and suitability but about the role more generally. There is a potential for conflict between the positions of the chairman, Sir Andrew Likierman, and of Mr. Morse. I am talking not about them as individuals but about the two roles, which have the potential to overlap. There are issues about the usefulness of the hearing processes, when they do not contribute directly to a recommendation or otherwise on the suitability of an applicant. There is also an issue about the balance between finding value for money and the financial audit work undertaken by the NAO. Mr. Morse will of course have some significant issues in his in-tray, not least the vexed question of whether private finance initiatives will contribute to the overall public debt of the country.

If the hon. Gentleman had taken the trouble to read the PAC report, he would have seen that the hearing process contributed directly to the satisfaction expressed by the Committee that Mr. Morse was a suitable person to appoint.

I am grateful to the hon. Gentleman for that contribution. Perhaps I did not word my comment as neatly as I might have done, but my understanding is that the Committee was not able to ratify the appointment, and that it was able only to guide it. That might be suitable, however; perhaps everyone on the Committee feels that that level of authority is appropriate.

This is a very important point. The reason we did it this way is that the Committee, like every other Committee in the House, has a Labour majority. If it had seconded the motion of the Prime Minister, we would have had a Labour Prime Minister proposing the new Comptroller and Auditor General and a Labour-dominated Committee seconding his appointment. The whole point, as I outlined earlier, is that both the Opposition and the Government have a lock on this process.

I am delighted that Mr. Morse’s appointment finds favour with all parts of the House. His appointment is certainly supported by my party. I have not, to my recollection, ever met him, but his CV is certainly impressive and hours of hearings have been undertaken to gauge his suitability. I can only conclude that he must indeed be a person who can undertake this onerous task in a distinguished manner.

I shall conclude with a quote from the Committee’s report—which I have indeed read—that makes this point forcefully. It states:

“As a Committee, we have no role in the statutory process of selection and appointment of the Comptroller and Auditor General. Nonetheless we believe that our views should carry weight in the debate on the Prime Minister’s motion praying the Queen to appoint Amyas Morse, since we have collectively some 65 years of experience on the Committee and thus of working with the Comptroller and Auditor General and the National Audit Office. We are satisfied that Amyas Morse is highly suitable for the post of Comptroller and Auditor General.”

On that basis, I hope that the appointment will find favour among all Members.

I am pleased to take part in the debate to confirm the appointment of Mr. Morse as Comptroller and Auditor General. Having seen him in the hearing, I have no doubt at all about his suitability. His experience of running a large international accountancy practice, PricewaterhouseCoopers, combined with his experience as commercial director of the Ministry of Defence, renders him highly suitable for this very difficult job.

In appointing Mr. Morse as Comptroller and Auditor General, the Government are going to have to fix several things. It is a pleasure to see a number of former members of the Public Accounts Committee now sitting on the Treasury Bench and taking part in the debate. I saw the hon. Member for Hemsworth (Jon Trickett) earlier. When he was a member of the Committee, I always used to feel that he and I were hunting together as a pack when we were probing the civil servants before us. Unfortunately, he is now engaged on other responsibilities—bunker maintenance might be the best description for them. There are others sitting on the Treasury Bench who have had recent PAC experience. I enjoyed their incisive contributions through the years when they were members.

There are aspects of the Comptroller and Auditor General’s access to the information he needs that will have to be fixed. The National Audit Act 1983 states that the Comptroller and Auditor General should have complete discretion in the exercise of his functions. One might assume that this is completely true, but in fact it is not true at all, as there are three obvious exceptions.

The first is the Financial Services Authority, to which the Comptroller and Auditor General does not have access. That means that he cannot carry out an audit of the effectiveness, efficiency and economy of the FSA in the way he can with, say, the Ministry of Defence or the Department of Health. I personally believe that that has had significant consequences—for example, in respect of Northern Rock. When it got into huge difficulties, it was discovered to be subject to a regulatory system under which the different players did not know what they were doing. It became very obvious in the autumn of 2007, as seen in the National Audit Office report based on evidence from the Comptroller Auditor General, that the three parts of the regulatory system did not know what the others were doing. That was the result of a lack of scrutiny of the FSA. The Comptroller and Auditor General would have carried it out, I believe, if he had had the right of access to do so—but he did not, so when it was done, it was done by the Treasury.

I am afraid that only once over a period of seven or eight years did the Treasury ask the NAO to look at the activities of the FSA. In that regard, it failed in its functions. I do not blame the Exchequer Secretary, who was a very incisive member of our Committee when she was on it. Functionally, however, the Treasury has failed, and Sir Nicholas Macpherson has more or less admitted that point and agreed to go back and look over the matter.

Secondly—

Order. I think the hon. Gentleman is ranging rather wide of the measure before the House, which is specifically about an appointment.

Indeed, Mr. Deputy Speaker, so I shall try to confine my remarks to the appointment of the Comptroller and Auditor General. In talking about that appointment, I hope it is in order to discuss the functions of the Comptroller and Auditor General once he is appointed and whether or not he is able to exercise them.

Perhaps—narrowly and briefly.

I will be very narrow and very brief, Mr. Deputy Speaker.

My second point concerns the BBC, to which the Comptroller and Auditor General does not have access either. That has an impact on the effectiveness, efficiency and economy of the BBC and on the extent to which it is scrutinised. When Dame Ellen MacArthur sailed around the world, 64 television producers turned up in Falmouth to cover it. I am not sure that that would have happened if they had known that they were going to be subject to public audit in the way that most Government Departments are. That has nothing to do with editorial control.

The third point, and it is the most serious of all, concerns this House. I hope that you will agree, Mr. Deputy Speaker, that it is directly relevant to this debate. What better time to appoint the nation’s chief auditor than after what has happened over the last couple of weeks? I can think of no more important appointment for us to make. According to statute, the Comptroller and Auditor General has all the authority over the National Audit Office. As the Government well know, that is why we are soon going to see changes. As I say, the Comptroller and Auditor General has all the authority under statute and the NAO is organised under his control into value-for-money divisions and financial audit divisions.

Will my hon. Friend allow me?

I would rather keep going, if I may, as Mr. Deputy Speaker has asked me to be brief.

As it is organised, the Defence, Health or Transport audit will have two sub-branches: financial and value for money. Within the NAO, there is also a section called “Justice and Parliament”—and I had always assumed that the Justice and Parliament section could audit the House of Commons administration in exactly the same way as the Health audit section can audit the Department of Health or as the Culture, Media and Sport section or the Transport section can audit those Government Departments. It turns out, however, not to be the case.

I discussed this issue with an assistant Comptroller and Auditor General last week. Previously, I had always thought that the auditors could go in and examine the House of Commons administration and do all the audit they needed to perform to satisfy themselves in exactly the same way as for Departments. It turns out, however, that for all these years, all they have been able to do is to compare the claims made by Members with the amounts paid and check that the two are the same—that is all they can do. When I asked one of the assistant auditors general why it was not possible to do more, the reply was, “That is all we could get.”

I hope that you will agree, Mr. Deputy Speaker, that what I am saying now is directly relevant to this debate and to the appointment of the Comptroller and Auditor General. The truth is that that is not good enough. It is not the fault of the Comptroller and Auditor General that it is not good enough, as it is the responsibility of the Government and this House. When the Government fix the problem, they have to ensure that the new Comptroller and Auditor General we are appointing—I think he is the right person for the job—has all the access he needs to do the job properly.

It is a great pleasure to conclude the debate. I echo the tributes of my right hon. Friend the Prime Minister and of right hon. and hon. Members on all sides of the House to the outgoing Comptroller and Auditor General, Tim Burr. He has been a public servant for more than 40 years, beginning his career in the Treasury. In particular, he was the Treasury Officer of Accounts between 1993 and 1994 before moving to the National Audit Office to become a member of its management board. In 2000, he became deputy Comptroller and Auditor General, before assuming the office of Comptroller and Auditor General, on an interim basis, on 1 February last year. I am glad that all Members—and particularly my right hon. Friend the Member for Swansea, West (Mr. Williams), who although not the current Chairman is the most experienced member of the Public Accounts Committee and provided great service in that role over many years—have paid full tribute to Mr. Burr. The Government were grateful that Mr. Burr agreed to take on the role of Comptroller and Auditor General on a temporary basis. We know that he has fulfilled that role with integrity and been a steadying hand on the tiller.

The hon. Member for Taunton (Mr. Browne) suggested that there might be some disagreement over the roles of the Chairman of the National Audit Office and the Comptroller and Auditor General. Actually, all parties are agreed on what we have done in making this appointment today, and the approach was agreed by the National Audit Office.

rose—

I gladly give way to the hon. Gentleman, who has been very much involved in this matter.

This is a very important point, which was carefully considered by the both the Commission and the Committee. There will be no disagreement because Sir Andrew Likierman will concern himself only with the corporate governance of the NAO. The CAG will have the absolute, independent, full and individual right to propose what he studies and to issue his results to the PAC. The PAC will never consider policy in itself, but only its effectiveness. I have chaired more than 450 meetings of the PAC, at which we have never had even one vote. Contrary to what was said earlier, the system does work and does provide independence for the CAG.

I am a former member of the Public Accounts Committee and I have had the privilege of occasionally sitting in on some hearings—not all 450—from the Government side. I can certainly confirm that when I was a fully fledged and regularly attending member under the chairmanship of the hon. Gentleman, we did not have any votes. I believe that the PAC continues to do a vital job, so I welcome the hon. Gentleman’s clarification in response to some of the doubts expressed by the hon. Member for Taunton.

The Government are committed to bringing forward legislation to implement the recommendations of the Public Accounts Commission on NAO corporate governance and will do so as soon as the legislative timetable allows.

I want to welcome the appointment of Mr. Morse as Comptroller and Auditor General. As the Prime Minister said, Mr. Morse has had a distinguished career in the private sector and is currently the Ministry of Defence’s commercial director. His appointment brings a number of “firsts”. He will be the first Comptroller and Auditor General to have private sector experience, which will prove invaluable to the National Audit Office. He will be the first chartered accountant, the first to be appointed through open competition and the first to be subject to a pre-appointment hearing. He is also the first to agree to be appointed for a limited term.

I have been listening with great attention to the Minister’s speech. She endorsed the recommendation, with which I agreed, that the new Comptroller and Auditor General should be both a chartered accountant and from private practice. Given that audit background in private practice, will the Government accept any of the Comptroller and Auditor General’s recommendations? I am thinking of, for instance, the recommendation presented jointly by the Audit Commission and the National Audit Office that the private finance initiative should go on the Government’s balance sheet.

That is a rather wider question than the question of the appointment hearing, but, as the hon. Lady knows, changes to accounting mechanisms are being considered by the professional bodies that have a bearing on this matter. I look forward to discussing it with her during one of our regular Public Accounts Committee debates, when she may wish to make her points again.

I suggest that Members read the transcript of Mr. Morse’s pre-appointment hearing before the Public Accounts Committee. It provides an insight into his background and knowledge, as well as how he will work with the new non-executive chairman, Sir Andrew Likierman.

A substantial amount of work will be involved in bringing the corporate governance of the National Audit Office into the 21st century, and, as we have already heard today, similar work is being done in parallel in other institutions. I am sure that Mr. Morse is relishing the opportunity to lead the National Audit Office through the next decade of change. The NAO and the PAC do a vital job in securing value for money for every penny of public expenditure and explaining to us what we can do in the event of failure. I know that Mr. Morse will be ably supported by Sir Andrew Likierman, and I commend the motion to the House.

Question put and agreed to.

Resolved,

That an humble Address be presented to Her Majesty, praying that Her Majesty will appoint Amyas Morse to the Office of Comptroller and Auditor General.

I beg to move,

That the following new Standing Order and amendments to the Standing Orders be made—

A. New Standing Order: Planning: national policy statements

(1) Whenever a proposal for a national policy statement is laid before this House under section 9(2) of the Planning Act 2008 (‘the Act’), the Liaison Committee shall report either—

(a) that it has designated a select committee appointed under Standing Order No. 152, or

(b) that it recommends the appointment of a National Policy Statement Committee to consider the proposal.

(2) A National Policy Statement Committee—

(a) shall be composed of not fewer than seven nor more than fourteen members, all of whom shall be, at the time of nomination, members of one 15 or more of the following select committees—

Communities and Local Government

Energy and Climate Change

Environment, Food and Rural Affairs

Transport

Welsh Affairs;

(b) shall have power—

(i) to send for persons, papers and records, to sit notwithstanding any adjournment of the House, to adjourn from place to place within the UK; and

(ii) to appoint specialist advisers either to supply information which is not readily available or to elucidate matters of complexity within the committee’s order of reference; and

(c) may report from time to time and shall cease to exist either—

(i) if it has reported on the proposal before the designated date, when the relevant national policy statement or amended national policy statement has been laid under section 5(9) or section 6(9) of the Act; or

(ii) if it has not reported on the proposal before the designated date, on the designated date;

(3) A committee designated or appointed to consider a proposal for a national policy statement shall have power, in the course of its proceedings under this order, to invite Members of the House who are not members of the committee to attend, and, at the discretion of the chairman, take part in, its proceedings, but such Members may not move any motion or amendment to any motion or draft report, nor vote nor be counted in the quorum of the committee;

(4) If a committee designated or appointed to consider a proposal for a national policy statement has not reported on the proposal before the designated date, then the chairman of the committee shall report that the committee makes no recommendation with regard to the proposal.

(5) For the purposes of this Order, the designated date in relation to any proposal for a national policy statement is the thirty-ninth day before the expiry of the relevant period defined under section 9(6) of the Act.

B. Amendments to Standing Orders

That Standing Order No. 121 (Nomination of select committees) be amended, by inserting after ‘(b)’ in line 17—

‘(i) in the case of a motion to agree with a report from the Liaison Committee to appoint and nominate Members to a National Policy Statement Committee under Standing Order (Planning: National Policy Statements) the motion is made on behalf of the Liaison Committee by the chairman or another member of the committee; or

(ii) in other cases’;

That Standing Order No. 145 (Liaison Committee) be amended by leaving out paragraphs (6), (7) and (8) and inserting the following paragraphs—

(6) The committee shall have power to appoint two sub-committees, one of which shall be a National Policy Statements sub-committee.

(7) A National Policy Statements sub-committee—

(a) shall be composed of—

(i) those members of the committee who are members of the Communities and Local Government, Energy and Climate Change, Environment, Food and Rural Affairs, Transport and Welsh Affairs Committees; and

(ii) up to two other members of the committee, one of whom shall be appointed chairman of the sub-committee;

(b) shall report to the committee on the use of the committee’s powers under paragraph (1) of Standing Order (Planning: National Policy Statements); and

(c) may report to the committee on matters relating to national policy statements under the Planning Act 2008.

(8) Each sub-committee shall have—

(a) a quorum of three; and

(b) power to send for persons, papers and records, to sit notwithstanding any adjournment of the House, and to report to the committee from time to time.

(9) The committee shall have power to report from time to time the minutes of evidence taken before any sub-committee.

(10) The quorum of the committee shall be as provided in Standing Order No. 124 (Quorum of select committees), save that for consideration of a report from a National Policy Statements sub-committee under sub-paragraph (7)(b) the quorum shall be three.

I must tell the House that Mr. Speaker has selected the amendment in the name of the hon. Member for Hayes and Harlington (John McDonnell).

The changes in the planning regime that resulted from the Planning Act 2008—in terms of the establishment of the Infrastructure Planning Commission, the role and extent of national policy statements and the ability of the public to make their views known on the proposals—were scrutinised extremely closely during debate on the Bill here and in the other place.

This is neither the place nor the occasion to discuss the merits or otherwise of the Infrastructure Planning Commission, or whether the country should have a new generation of nuclear power stations or an increase in airport capacity. I am sure, Mr. Deputy Speaker, that you would rule us out of order if we strayed into that territory. Instead, we shall be discussing a motion that is concerned with the process by which Parliament will be involved in scrutiny of the new planning framework.

I do not intend to go down the avenue that the Minister just mentioned, but may I point out to him that, in the context of the proposed scrutiny process, there are serious concerns about sustainable development? Can he reassure me that the Sustainable Development Commission will have an input and that corresponding opportunities will be provided for scrutiny by the Environmental Audit Committee, so that we can be certain that whatever the outcome of the establishment of the Infrastructure Planning Commission, sustainable development has been properly taken into account?

That is an important question. As was made clear during the passage of the Planning Bill and is made clear in the Act, sustainability must be at the heart of any national policy statement. I shall say more about parliamentary scrutiny shortly. I do not wish to mislead the House, but I seem to recall that the Sustainable Development Commission is one of the statutory consultees and will therefore have the opportunity to play a role in regard to national policy statements.

The Minister is being very generous in giving way, and I am grateful to him. Can he also reassure me that the commission will have regard to the future price of carbon when making planning infrastructure decisions?