NAO: Overseas Work

4. To ask the Chairman of the Public Accounts Commission, what recent comparative assessment the NAO has made of its work and that of similar bodies in (a) developing and (b) other countries.

10. To ask the Chairman of the Public Accounts Commission, what recent comparative assessment the NAO has made of its work and that of similar bodies in (a) developing and (b) other countries.

The NAO is a leading, supreme audit institution in the international community and works closely with other offices. It believes that it can grow and learn as an audit office by sharing and exchanging ideas with others. It periodically benchmarks itself against other similar audit bodies in other countries.

May I join my hon. Friend the Member for Kettering (Mr Hollobone) in paying tribute to my right hon. Friend, whose career in the Public Accounts Commission I have followed closely both from the Government Benches and from previously serving as his constituency agent. Does he agree that there is widespread concern about spending on international aid? Will he outline what the NAO is doing to ensure we achieve value for money?

Clearly, there are enormous risks in our overseas aid budget. I will not comment on policy aspects, but if we are linking expenditure with a proportion of gross national product, which can rise every year, there are enormous possibilities in the Department for International Development for waste, incompetence and employing too many staff. I know that the NAO is particularly concerned with ensuring that in our international aid work, which is so important, we concentrate on work on the ground and try to root out waste and incompetence.

We have some excellent institutions, in addition to the NAO, that work towards underpinning our overseas trade and investment, such as CDC and UK Export Finance, but if we are to boost international trade we need to increase our appetite for risk. We need to accept that a higher number of failed projects will be a sign of success. Does my right hon. Friend agree that if the NAO’s attitude to risk is too risk-averse or too judgmental of individual project failures, there is a danger it may undermine our international trade objectives?

I assure my hon. Friend that that is simply not the case. The NAO recognises that the civil service, and indeed Ministers, occasionally have to take risks, because that is the only way to learn—you learn from failure. We are not risk-averse, but we expect Departments to evaluate risk. On projects such as the Olympic Games, IT projects, the Child Support Agency and all the things we have investigated over the past 18 years, we expect Departments to evaluate risk and take risks, but get things right in the end.