Whitehall’s spending watchdog will scrutinise Britain’s Brexit divorce bill to make sure it represents value for taxpayers’ money, ministers have been told.
Sir Amyas Morse, head of the National Audit Office, told the Treasury select committee that he will examine whether the bill, which is estimated to cost anything between £30bn and £90bn, represents value for money.
In a rare appearance before MPs, Britain’s most senior auditor also urged the government to give HM Revenue and Customs extra resources to ensure that a back-up customs system can be put in place before March 2019.
He also warned ministers to stop suffering from “optimism bias” over the number of major projects that they plan to implement whilst trying to leave the European Union.
The EU is pushing for a financial settlement of up to £90bn as the price of Britain’s divorce from the bloc.
Morse, the comptroller and auditor general of the NAO, disclosed that the bill will be scrutinised and could be presented under a series of headings, which could then be analysed by the independent body to check public spending.
“At present my thinking is we’d approach it quite like a normal large transactional deal, where you examine all the elements in it then look at it how they are combined for reasonableness and range of value.”
HMRC is installing a new system two months before Brexit in 2019. Tax officials told MPs last week that £7.3m is needed to improve the old system in case it does not work in time.
Questioned by the select committee, Morse said this was “not a very significant sum of money in the scheme of things”.
“If I was giving you advice … I would say push that forward. I would have thought having a contingency plan fully prepared would be something you wanted to crack on with straight away.
“There are things like that where I feel that it’s not a good idea to operate acceleration and the brake at the same time,” he added.
Asked by Labour’s Rushanara Ali if the government suffers from “optimism bias” in believing they can implement major projects such as Hinkley Point C, HS2 and Crossrail while implementing Brexit, Morse agreed.
“They do because they set themselves goals which are too optimistic,” he said.
Morse warned that the UK’s decision to leave the EU would mean government resources, including civil servants, IT professionals and legal advisers, being directed towards managing Brexit and therefore away from delivering major infrastructure projects.
He urged ministers to make decisions prioritising goals before those decisions are forced upon them.
“To say ‘what we will do is to top slice every department’ is an odd way to approach it given that some are much more affected by Brexit than others,” he said.
“There just isn’t going to be an opportunity to introduce very much legislation on any other matters but Brexit for quite a considerable period of time.
“Do we really need to bring these changes forward right now when we are going through such a large change process with Brexit?
“Now rather than see this as a problem to be overcome, it might be seen as an opportunity to go through a re-prioritisation exercise,” he said.
Whitehall is beginning to realise that choices will have to be made over policy areas because of a skill shortage, Morse said.
“People are beginning to understand about the scale of the task. The skill shortages are in digital, commercial and project delivery. Exactly some of the areas needed to carry out these projects.
“I am not trying to be a doom-monger,” he said. “There is a real need to think about where to put them for the best result in the national interest.”
National Audit Office to examine UK’s Brexit divorce bill – The Guardian