Audit Committee, 06 Jan 2004

Meeting date: Tuesday, January 6, 2004

Official Report 204KB pdf

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Scottish Parliamentary Corporate Body

Under agenda item 4, we will hear from the Auditor General for Scotland about his audit of the Scottish Parliamentary Corporate Body for 2002-03. Members have had various papers circulated to them, including the Auditor General's section 22 report, the Parliament's accounts and a copy of the letter from Paul Grice, who is the accountable officer as far as the Scottish Parliamentary Corporate Body's operations are concerned. I invite the Auditor General to brief the committee.

My report is concerned with the results of my audit of the Scottish Parliamentary Corporate Body's 2002-03 accounts. The purpose of the audit is to review independently and report on how the corporate body discharges its stewardship responsibilities with regard to the use of public money. The audit opinion is partly based on tests of the evidence relating to the amounts, disclosures and regularity of spending and receipts shown in the financial statements, but there is no examination of all the items in the accounts.

In my report, I explain that I have provided an unqualified audit opinion on the presentation of the corporate body's accounts, but that I have qualified my opinion on the regularity of expenditure. I shall detail the reasons for that qualification in a moment. What it means in plain terms is that, although there was sufficient evidence to confirm that the accounts are not materially mis-stated, there were important shortcomings in the corporate body's internal financial controls. Specifically, those weaknesses in control prevented me from gaining sufficient assurance regarding the possibility of accounting errors, or even fraud, affecting the corporate body's affairs in some way.

My qualification does not mean that there is evidence that any actual financial losses have occurred as a result of shortcomings in control. However, I considered that a qualification was necessary because of the uncertainty created by the control weaknesses and because of the serious potential risks arising. Even if those risks do not appear to have materialised, the shortcomings were serious and it is important that the corporate body should improve that aspect of its financial stewardship.

I shall now turn briefly to the specific control weaknesses that gave rise to the audit qualification. The main weakness was that, during the year, the corporate body did not perform the necessary periodic reconciliations between its bank accounts and its accounting ledger. Consequently, the corporate body could not be certain that what it had recorded as expenditure in its accounts properly and accurately reflected what its bank showed that it had actually spent in cash. As members will appreciate, it is vital that the corporate body can match those records properly and so demonstrate with certainty the accuracy and completeness of its expenditure within the accounts.

Because of the importance of that control, the corporate body, with significant input from Audit Scotland, put in a lot of extra work after the end of the financial year to try to match all the various transactions retrospectively. I am afraid, however, that its efforts had not succeeded completely by about the middle of December, when Audit Scotland, at my request, had to draw a line under matters to allow me to comply with the statutory deadline for completing the audit in time for the accounts to be laid in the Parliament and published by the end of December.

Paragraphs 6 to 9, on pages 2 and 3 of my report, provide some details of the reconciliation problem and how the corporate body has responded. Although most of the transactions can be properly matched, a small but significant number have yet to be fully and properly explained. Specifically, at the time of completing the audit, there were some 290 unmatched items between the corporate body's main bank accounts and its ledger. Because most of those 290 items involved a mix of debit and credit entries, which were offset against one another, their combined net total was reported to be very small, at just over £300. However, the combined value of the underlying transactions, which have not so far been matched, was significantly greater, at some £5.3 million.

In addition to the specific problem of matching the corporate body's bank accounts and its accounting ledger, the audit found other weaknesses in the general standards of the accounting controls and financial reporting within the corporate body. I shall summarise those weaknesses briefly.

First, there were other reconciliation problems arising from differences between the corporate body's accounting ledger and some supporting systems, such as the payroll. Secondly, there were questions about the effectiveness of cash flow management. Thirdly, standing financial instructions had not been prepared and control over some of the basic accounting transactions was poor. Fourthly, there were weak procedures for the preparation and maintenance of the accounts, with persistent errors in the accounts submitted for audit at various times. Finally, Audit Scotland concluded that, in general, there was a need for more effective leadership of the SPCB's finance department. Paragraphs 10 to 15, on pages 3 and 4 of my report, record those other weaknesses in greater detail.

I have obviously discussed matters with the clerk and chief executive because of his role as the Parliament's principal accountable officer. He accepts that things could and should have been done better, but he has emphasised that action is in hand to address the concerns that Audit Scotland and I have raised. The corporate body's action in response to the various points is summarised in paragraph 18 of my report. Again, I shall briefly mention those points.

The corporate body is seeking to recruit someone to a new post of financial controller, after the previous head of finance resigned last April. That post was advertised in November. The corporate body is continuing to work to complete the outstanding reconciliations in consultation with Audit Scotland. That needs to be done, not least to provide a secure foundation for the 2003-04 accounts—the accounts for the current financial year. The corporate body is addressing the identified control weaknesses. For example, I understand that, since April last year, it has completed the necessary bank reconciliation every month. Finally, the corporate body is preparing standing financial instructions, which it intends to introduce in March 2004.

My colleagues and I will be happy to answer any questions that members of the committee may have.

You referred to standing financial instructions. Are there instructions at the moment, how robust are they and what advice was provided by the Parliament's auditors?

There are no financial instructions of a comprehensive nature in place at the moment. That is an important issue, because financial instructions provide the overall framework for internal financial control. They should be documenting the controls that the corporate body itself has decided, at a higher level, should be in operation and they should provide guidance on how they operate in practice. It is an urgent issue because, without clear financial instructions, staff might take a pragmatic approach to implementing internal controls on a day-to-day basis. One of the examples that Audit Scotland came across is staff's ability to write off amounts to the ledger without authorisation as no instruction was in place. It has been a serious issue. That is now recognised within the corporate body and by the principal accountable officer. As I have indicated, they are now working to get those instructions introduced in the spring.

Given what you have said, should the auditors not have drawn the fact that there were no standing financial instructions to the Parliament's attention before year 4?

The short answer to that is yes. I assure the committee that there has been a considerable period of dialogue between the auditors and corporate body officials about these matters. In essence, the way that we like to proceed, and have proceeded in this case, is in the first instance to draw matters of concern to the attention of officers of the Parliament. After a period, in the course of the normal audit, we would report those concerns if they were not being addressed fully.

Thanks very much.

I seek further clarification. From what you have said, I take it that you highlighted the problem in year 1.

The issue would have been highlighted at an earlier stage.

I take it that it would have been highlighted in year 1, when you did the first set of accounts.

I refer you to my team for a detailed answer to that.

Good morning. I have been involved in the audit of the corporate body for the past three years. It is important to acknowledge that the body is still a young organisation and has been evolving over those three years. To ask whether it had standing financial instructions is to put a very black-and-white question. The answer is that it did not have a full set of formally approved standing instructions, but it had various procedures that it inherited from previous arrangements. It adopted various practices as it developed its procedures. The day-to-day procedures that were in place had evolved since the start of the Parliament, but there was not a complete set of approved procedures. The procedures are in effect the organisation's policies on how it is run. The point that we were making in our most recent audit concerned the formal approval of procedures on such matters as the write-off of debts and who is authorised to write off those debts. It is right to say that there were no formally approved procedures, but the body was not without day-to-day instructions on how to do things. There were low-level procedures, but not high-level policy statements, particularly with regard to the write-off of debts.

You said that the procedures in place in year 1 were inherited from previous arrangements. I do not understand what you mean by that. Were you referring to arrangements pre-devolution, before the project started?

The original arrangements were handled by the Scottish Executive and were then handed over to the corporate body at its creation. The corporate body uses and has used the same ledger as that used by the Scottish Executive. Originally it used a system referred to as SCOAP—the Scottish Office accounting package. It then implemented a new ledger system in parallel with the Scottish Executive. Many of the day-to-day instructions are related to the running of the financial ledger. In that sense, the corporate body inherited the original instructions and day-to-day procedures when it took up the SCOAP financial system as run by the Scottish Executive. When the new ledger system was introduced, the initial procedures were converted to it and there were certain parallels with the Scottish Executive's procedures at that time.

The whole process has been evolving with the implementation of the new ledger system and the detailed instructions have also been evolving. In the first part of the corporate body's existence, it used an older ledger system that it inherited from the Executive and the procedures went with it. It is now using a new ledger system, which is shared with the Scottish Executive. The procedures have evolved from the old procedures, but there is an urgent need to review the high-level policies on how the financial instructions are enacted. I understand that a party has been seconded from the City of Edinburgh Council to assist in the drafting of those policies. Once they are complete, they will be submitted for approval.

I draw to members' attention the second-last bullet point in the letter from Paul Grice, which gives his response on what action is being taken. That action is intended to be completed by March this year.

I want to get a bit of context and put the matter into perspective. You said that there is no evidence of any irregularity whatever and that in relation to the overall budgets, the amounts involved are very small. However, the matter is important enough to make you qualify your audit opinion. What is the next step in the qualification of the audit opinion? What are the implications of it? How do we ensure that steps have been taken and that what is happening is beginning to bear fruit in relation to tightening up the system? Where do you take it from here and what are the next steps for us?

The signing of the audit opinion and the making of my report to Parliament are the end of the matter for me in relation to the past financial year; a line is drawn under that.

Absolutely.

At the next level down, there is an on-going relationship between the management of the corporate body and the external audit team from Audit Scotland, which is led by Peter Tait, who has been answering your questions this morning. In the course of the next six months, the team will engage in the audit of the financial year 2003-04. In undertaking that audit it will have particular regard to the concerns that have been revealed in the past financial year. I imagine and expect confidently that Peter Tait and his team will take a particular interest in reviewing the financial instructions that we have been talking about to ensure that they meet the standards of best practice in that area.

The members of the corporate body are responsible for overall governance. They receive reports from the accountable officer, the audited accounts and any reports that I make. I understand that they have been informed of the qualification of the audit and of my report. There is also an audit advisory board, which receives detailed reports from both internal and external audits. That board meets the auditors and has the opportunity to discuss the issues raised. It is fair to say that I am satisfied that these matters are being addressed seriously at a number of levels. Indeed, it is important to put on record that I am satisfied that they are being seriously addressed by the principal accountable officer—the clerk and chief executive of the Parliament—and by the other bodies, particularly the audit advisory board, that have a particular role in this respect. We have had a very extensive dialogue with them about these issues.

First of all, I want to raise a point of clarification that members might or might not choose to follow up. Did you say that the head of finance resigned in April?

That is correct.

Your report says that the post was advertised in November 2003 and that we are now at the point of shortlisting candidates. Presumably, by the time the person who is recruited gives and serves out their notice, it will be April 2004 before they take up their post. Did the lack of a head of finance have any effect with regard to drawing up the remit or introducing the changes that might have been required? Was there any good reason for the delay between April and November 2003 to take steps to advertise and fill such a high-profile and senior post? Finally, is it normal public sector practice to have left such a senior position unfilled without any good reason between—at the very least—April and November 2003?

I think that there are two parts to that question, the first of which concerns the question whether the resignation and therefore absence of the head of finance might have contributed to the problems that have been highlighted. The second part of the question concerns the filling of the vacancy.

On the first part, the resignation of the head of finance and the lack of leadership within the finance department were significant issues. It seems very clear that there were problems with the quality of the upward reporting from finance to the principal accountable officer and from there on to the SPCB and the audit advisory board. As a result, the short answer to the first part of Mr MacAskill's question is yes, the situation caused by the vacancy at the head of finance level—and possibly the situation before that person departed—contributed to the problems.

As for the question of filling the vacancy, I understand that arrangements were made to fill the post on an interim basis. However, I am sure that Peter Tait, who is closer to these matters, will be able to provide the recent history of how the vacancy was handled.

When the previous head of finance left the post, the SPCB as an interim measure appointed another person to hold the position. That person managed the SPCB's financial affairs on a daily basis under the supervision of senior management, which included the clerk and chief executive of the Parliament.

Senior management had been aware of difficulties with the bank reconciliations. Indeed, we had been in touch with management about the importance of clearing them and significant progress was made on the matter from April through to September. When we arrived to commence the final accounts audit, we were informed initially that the accounts were reconciled. The audit advisory board and the accountable officer had also been told that the accounts had been reconciled; indeed, internal auditors had reported to the board that the accounts were reconciled and the problems resolved.

However, during the first stages of our work, we became aware that the accounts were not reconciled and, within a matter of days, I had written to the clerk and chief executive to inform him of our concerns. In a two-month period through October and November, the SPCB undertook a great deal of work to attempt to reconcile the bank accounts before the end of the audit and we ourselves put in a substantial amount of additional audit resource to assist and complete the work before the statutory deadlines. However, time was against the SPCB. The scale of the task was really too great for it to be completed by the deadline. The Auditor General has already pointed out that, under his instructions, we had to draw a line. At that point, there were 290 unreconciled items, which formed a significant enough aspect for us to take them into consideration in recommending a conclusion to the final audit.

As I understand it, the current financial procedures are based on established Scottish Office practices, which have been modified over the years to meet the Scottish Parliament's very special needs. However, you have indicated that those procedures have not received formal approval. What would be the process for securing formal approval for the procedures that have evolved over the past three years?

The process is relatively straightforward. The principal accountable officer oversees the preparation of a set of guidelines, which are subject to independent comment by the external auditor to ensure that he or she is satisfied that they are along the right lines and at the right level and that they cover the right issues. As far as the SPCB is concerned, I confidently expect the audit advisory board, which contains very senior people from an accountancy background, to take a close interest in the matter. Once the board has satisfied itself that the guidelines are appropriate, it is likely that they will be presented to the SPCB for its formal approval.

So the SPCB ultimately approves the guidelines.

Yes, because it is ultimately responsible for the governance of these affairs.

I want to pursue some of the points of clarification that Peter Tait made. I am still rather bemused by the fact that an interim head of finance was appointed in April 2003. An interim post would be left that way only if it was meant to become permanent. The fact is that there has been a considerable delay in taking steps to appoint a head of finance. Can you provide any clarification on that matter or can only the SPCB do that?

Moreover, as the convener has correctly pointed out, the accounts in question obviously end on 31 March 2003. As a result, the head of finance who resigned dealt with those matters. Will the subsequent interregnum that appears to have existed give rise to any further problems, given that we have been scrambling around to sort out the problems with the 2002-03 accounts and that we are now about to sort out the 2003-04 accounts?

I hesitate to answer the particular question about why there was an interim solution rather than an attempt to fill the substantial vacancy. Instead, I encourage members to seek an answer to that question from the accountable officer himself.

It goes without saying that any organisation—particularly a smaller one such as the SPCB—would face problems if a key person such as the head of finance disappeared at year end when the whole process of closing the accounts and preparing them for audit was in hand. As a result, we must acknowledge that that situation presented the SPCB with a particular challenge and I commend it for making arrangements to fill the post immediately—albeit on an interim basis—to ensure that the work could continue.

I should also point out that we are very satisfied with the progress that has been made since April of the current financial year in tackling these matters, not least in addressing the reconciliations. Unfortunately, for the reasons that Peter Tait and I have given, sufficient progress was not made by December to avoid the necessity of qualifying the accounts and of drawing the matter to the Parliament's attention.

Your report says that 290 underlying transactions have not been matched so far, and that the sum that is involved is about £5.3 million. You said that since you became involved, a huge amount of work has been put in to try to reconcile the accounts. I take it that that work took place after the previous finance director left and the interim position was filled. Was there any accurate reconciliation at the beginning of the process, when you became involved, or was there a need to start from scratch?

I would require Peter Tait's help to provide a full answer to that. In order for us to maintain an overall sense of what is happening, I point out that the qualification means that the accounts that were presented for audit were adrift. Many elements were presented appropriately, but others were not—in particular, the external auditor uncovered problems with a lack of reconciliation. The picture is complex and it is difficult to give specific examples of what is involved. It is important to say that all the significant errors have been corrected in the final version of the accounts.

If you want some examples, the technical errors in the draft accounts included incorrect treatment of a creditor balance of £1.84 million; assets valued at just over £1 million being incorrectly written off during 2002-03; incorrect treatment in 2001-02 of a retention of £1.28 million in capital contracts; and creditor accruals being understated by just over £1 million. That gives you a flavour of our findings but, at the risk of repeating myself, I emphasise that all the significant errors have been corrected in the final version of the accounts.

Your report indicates internal control weaknesses. A weakness which is of concern to every member of the committee is on the reporting of expenditure on MSP allowances. Some of us have been subjected to harassment on that in the past year. Can we take any comfort, given that you cannot verify that the amounts that are stated are correct? Where does that leave MSPs and where do we stand in relation to the list of weaknesses that has been published?

It is important to put it on the record that MSP salaries are included in the general running costs of £49 million. MSP allowances are controlled through a separate system, and the audit of that system's internal controls regarded them as satisfactory. The situation is not without risk, because the key weakness that was identified related to the lack of reconciliation between that system and the ledger. A risk is identified in our report, but I do not think that it is a significant risk. It was appropriate to mention it because it is a fundamental element of sound financial practice to reconcile what is in the system that controls payments with the ledger.

At the risk of sounding pedantic, I want to go back to a point that Peter Tait made. He referred to the Parliament having inherited a Scottish Executive system but, for accuracy, it is important to say that it was a Scottish Office system. As Robin Harper said, a great deal of the practices and the culture that you have described were inherited from the Scottish Office. To contextualise the matter, it is worthwhile to note that distinction and to note that, post-devolution, both the Scottish Executive and the Scottish Parliament have made significant changes to the systems that are involved and to the practices and culture that underpin them. Is it fair to say that?

Yes, it is fair to say that.

Having said that, I am interested in how financial management is performed in the Parliament and more widely in the public sector. I note that on the head of finance post, reference is made to "suitably qualified" applicants being shortlisted and interviewed at the moment. What qualifications are expected? Are we talking about people with professional financial or accounting qualifications? A Scottish Office practice that continues in the Scottish Executive means that that the principal finance officer and many other senior people within the finance function are not necessarily qualified accountants or finance professionals—that is different from the situation in many other organisations. Is that one of the changes that we will see in the Parliament?

My understanding is that the advertisement for the post indicated that, as an essential requirement, the corporate body would be looking for someone with a financial qualification.

To gain a sense of perspective on the issue, would it be fair to say that the problems that you have identified and which we have discussed are confined to weaknesses in the accounting and financial management functions? That is not to minimise the importance and significance of those weaknesses, but is it fair to see the problems in that way rather than as evidence of widespread weak financial management throughout the organisation?

It is fair to take away from this session the reassurance that no financial loss has been discovered and neither is there any indication that expenditure has been made inappropriately. However, I indicate to the committee that the control weaknesses were serious; controls are not optional but fundamental to the running of any public body. It is reasonable to expect the corporate body to operate at the standard of best practice in that area. The weaknesses are serious because they expose the corporate body to unnecessary risk. It is fair to say that the principal accountable officer recognises that there are weaknesses—that is reflected in his recent letter to the committee—and is acting swiftly to improve the situation.

How frequently do you make such a qualification on the accounts of a public body?

It is comparatively unusual to qualify the accounts of a public body for significant control weaknesses involving such issues. Having said that, the committee will recall that, under an earlier agenda item, we talked about family health service expenditure and the qualifications that have occurred year on year. Such qualifications are not common, but we have to make them from time to time.

In view of your reply to Susan Deacon, in which you said that there were serious concerns about the financial rules and that, although no moneys have been lost, the issue is still serious, a question arises. If the problems were highlighted in year 1, why has action been taken only today to address the concerns?

The general approach that we take to audit is that, if concerns arise in the audit of a financial year, we share those concerns with the management of the audited body and we expect action to be taken to rectify the problems. If no action were to be taken, the auditors would quite properly alert me in pointed terms. lf appropriate, I would then make a qualification or a report. It is not necessary for there to be a qualification for a report to be made and there have been occasions on which I have made financial reports to the Parliament in the absence of a qualification.

One of my colleagues put it succinctly yesterday when he said that we give people a yellow card and then give them a red card. In a sense, that is what has happened in this situation. There has been a long history of the auditor engaging with the appropriate people in the SPCB on issues of concern and receiving assurances that those matters were being addressed. However, it now transpires that they were not being addressed as timeously or comprehensively as they should have been and it is only in the current financial year—from April of this year—that sound action is being taken to rectify the position.

You are telling us that you have engaged with the chief executive and the organisation's previous finance officer a number of times over the past three years, but that no response has been made that would deliver—

I would not want to give you the impression that there has been no response.

Has there been insufficient response?

It is important to bear in mind my phrase about the lack of financial leadership and the quality of the upward financial reporting that was taking place. It seems clear that inappropriate assurances were being given to the highest levels of the SPCB.

In the annual report for the 12 months ending 21 March 2003, we note that there is a director of clerking and reporting, a director of corporate affairs, a director of legal services and so on, but no director of finance. Similarly, in our discussion today, we have talked about a head of finance. That suggests to me and, I suspect, to the general public listening to us, that there is not a director of finance or, at least, no one as senior as the other members of the management team. Again, you have highlighted the difficulty relating to reporting up. Is it the auditors' view that the control of finance did not rest at a senior enough level and that it might have been more appropriate to have a director of finance? Might that have made a difference to the outcome?

I would hesitate to suggest that there must be a director of finance. It is reasonable to expect that a suitably qualified and experienced person should be in overall charge of the financial management of the SPCB's budget. I will say that the auditors did not have full confidence in the previous incumbent, which might have led the principal accountable officer and the SPCB to consider raising the professional requirements of the post that is now being advertised.

I thank the Auditor General and Peter Tait for that briefing.

The committee must now discuss what further action we might take. From the questions that members have put, it strikes me that there are a number of unresolved issues about which we need to be satisfied. Further, there is a wider audience that would like us to ensure that our house is in order before we pontificate about other public organisations. That being the case, I am minded to suggest that we invite the principal accountable officer, Paul Grice, to come along to a future meeting. Given our work programme, I think that the soonest that we could manage to see him would be at our meeting on 3 February. Do members agree to invite Paul Grice to that meeting to answer further questions on the auditors' report on the accounts for 2002-03?

Given that the Auditor General has said that he considers that the action that is being taken by the principal accountable officer will significantly improve the financial controls, I wonder whether it is necessary to invite Paul Grice to the committee at this stage or whether we might want to leave that until a later point when we can assess the changes that have been made.

I hear what you are saying, but I also bear in mind the points that were raised during Kenny MacAskill and George Lyon's lines of questioning on the accounts for 2002-03. There has been some degree of interregnum in recruiting and, while a temporary situation has been put in place, we are already approaching the end of 2003-04. I think that it would be useful to the committee and to Paul Grice if he were to come before the committee and explain not only what has happened in the past, but what is happening currently and how expeditiously he intends to resolve the difficulties.

I have no difficulty with our inviting Paul Grice to give evidence to the committee as it will provide an opportunity for matters that have been raised to be probed further. However, I am conscious that matters have progressed to a significant extent and I wonder whether it might help us to strike a better balance if we had that meeting at a slightly later date. Alternatively, perhaps we could acquire, prior to our meeting on 3 February, a written submission from Paul Grice on the progress that has been made to date.

If I understood the Auditor General correctly—I would not ask him to speculate on this, because I understand that he cannot—it might well be that, if a line had not had to be drawn in December and there had been a few more months in which to work, some of the more considerable weaknesses would have been addressed.

As Margaret Jamieson and others said, the standing financial instructions are on track to be completed by March 2004. That is a key development and it will take place quite soon. Perhaps we should focus our consideration on such key developments that have flowed from the audit process. It might be more useful for us to focus on future improvement than to continue to go over elements of past practice, some of which have become quite clear.

I take on board much of what Susan Deacon said. It is important that we investigate the matter briefly, just to clarify it in the best interests of the Parliament and the SPCB. The Auditor General raised matters that cannot be addressed by him; therefore, in the interests of all parties, I would like to find out whether false, misleading or inaccurate information was given. If such information was given, it is to the credit of the SPCB and the principal accountable officer that they managed to address that matter. Such things happen, but we should be told about them.

I would like some clarification about the interregnum in the head of finance appointment process, and some indication that we are heading towards having the correct post that will be able to deal with such matters. Any information-gathering session with the principal accountable officer should not be conducted in terms of blame, but should seek clarification that we have drawn a line under what went wrong and that we are taking the right steps to address it. Susan Deacon is correct in saying that we are heading in the right direction, but we should take a belt-and-braces approach to ensuring that we are.

I support Susan Deacon and Kenny MacAskill, as well as the proposal that we do not rush at the issue too early. Perhaps a meeting held at a later date in March would be better than one held on 3 February, which is quite early.

Would it be appropriate to ask for some input from the SPCB?

We have to focus on the principal accountable officer; he is the one who can answer the questions and who is directly responsible for the operation. The letter from Paul Grice says that he is

"happy to address any specific points the Committee might have in light of tomorrow's briefing from the Auditor General."

There is, therefore, a willingness to ensure that any questions are answered.

It is the Audit Committee's duty to get to the bottom of those questions that have been raised as a result of the Auditor General's report but which he is not in a position to answer. It is in the interests of the Parliament and of Paul Grice that he should have a chance to explain publicly the cause of the problem and the action that has been taken to address the difficulties that have arisen. Much of that is linked to the personnel changes that we have heard about today, and Paul Grice should be given the chance to put on the record the action that he took as principal accountable officer. If the cause of the original problem has been identified, and right and swift action has been taken, it is in everyone's interests to get that story into the public domain as soon as possible.

My reading is that the committee agrees that we should meet Paul Grice; that is beyond dispute. There is a natural concern that it would be of more benefit to have Paul Grice come to a possible meeting on 2 March rather than on 3 February. It is a question not just of having the information, but of the committee being seen to deal with the matter as expeditiously and seriously as possible. We have to strike a balance between considering the matter further, hearing the information and then putting the matter to bed.

Susan Deacon was right to ask whether we would get more information if we waited until 2 March. I suggest that we ask Paul Grice to come to the meeting on 3 February, with the caveat that if there would be substantially more benefit in having that meeting a month later—in that we might have a resolution on the appointment of a head of finance and there might be considerable resolution of other outstanding matters—I would be willing to move the meeting to 2 March. There would have to be substantial gain to be had by waiting for a month, otherwise we would benefit by being seen to move quickly and holding the meeting on 3 February. With that caveat, is the committee agreed?

Members indicated agreement.

We will work along those lines. I thank the Auditor General for his help on those matters.

That being the end of agenda item 4, we move into private session. While we do so, and to give the press, public and broadcasters the opportunity to leave the chamber, I suspend the meeting for 10 minutes so that members might have a comfort break.

Meeting suspended until 11:59 and thereafter continued in private until 12:47.