Com­mons Com­mit­tee sav­ages HS2 re­dun­dancy prac­tices

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The House of Com­mons Pub­lic Ac­counts Com­mit­tee says HS2 Ltd ran unau­tho­rised re­dun­dancy schemes which cost tax­pay­ers £1.76 mil­lion.

In its re­port into HS2’s an­nual re­port and ac­counts, pub­lished on De­cem­ber 15, PAC also said: “There ap­pears to be a cul­ture within HS2 Ltd of fail­ing to pro­vide full and ac­cu­rate in­for­ma­tion to those re­spon­si­ble for hold­ing it to ac­count.”

HS2 Ltd ran com­pul­sory and vol­un­tary re­dun­dancy schemes in 2016-17, de­spite the frame­work which gov­erns the com­pany stat­ing that it is only al­lowed to of­fer statu­tory re­dun­dancy terms.

A re­quest to the De­part­ment for Trans­port to of­fer staff en­hanced re­dun­dancy pack­ages was re­fused, but the PAC says HS2 Ltd ran the en­hanced schemes any­way, com­mit­ting to pay­ments of £916,000 to 67 in­di­vid­u­als un­der the com­pul­sory scheme, and £1.84m to 27 in­di­vid­u­als un­der the vol­un­tary scheme. HS2 Ltd com­mit­ted to pay­ing £2.76m, com­pared with the £1m it would have paid as part of statu­tory re­dun­dancy.

“This means that £1.76m of tax­pay­ers’ money was spent in con­tra­ven­tion of the rules gov­ern­ing HS2 Ltd’s fi­nances,” the re­port says.

For­mer HS2 Chief Ex­ec­u­tive Si­mon Kirby was crit­i­cised, with the PAC say­ing: “Si­mon Kirby had been specif­i­cally in­structed by the De­part­ment [for Trans­port] that en­hanced re­dun­dancy terms were not ac­cept­able but ap­par­ently chose not to com­mu­ni­cate this to anyone within the com­pany.”

The re­port also con­cluded that HS2 Ltd “does not have in place the ba­sic con­trols needed to pro­tect pub­lic money”, and that HS2 Ltd and the DfT “still do not ap­pear to un­der­stand the risks to the suc­cess­ful de­liv­ery of the pro­gramme, which is cur­rently fore­cast to ex­ceed the fund­ing avail­able by £1.8 bil­lion”.

It rec­om­mends that HS2 Ltd should write to the PAC by the end of Jan­uary 2018, out­lin­ing how it will en­sure that all staff recog­nise that they are deal­ing with tax­pay­ers’ money and that they are re­quired to com­ply with the spe­cific rules and reg­u­la­tions gov­ern­ing its use. It wants HS2 Ltd to en­sure that pro­pos­als to op­er­ate out­side the agreed frame­work doc­u­ment are re­ported to both the HS2 board and DfT.

When a de­par­ture has been re­quested from nor­mal gov­er­nance rules, the PAC says the chief ex­ec­u­tive should con­firm in writ­ing that the de­par­ture com­plies with the re­spon­si­bil­ity for safe­guard­ing pub­lic funds, and re­port this to the rel­e­vant board com­mit­tee and to the main board as an au­tho­rised de­par­ture from nor­mal gov­er­nance rules.

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