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Hodge: Govt relying on 'periodic large write-offs'

The Government's treatment of debt has been "characterised by neglect and periodic large write-offs," according to the head of the Public Accounts Committee (PAC).

After a scathing report into the Government's failue to collect the £22bn it was owed, Margaret Hodge said:

The Government is owed this massive amount of money but it has failed to take a strategic, cross-government approach to managing that debt and getting more money paid to the Exchequer.

Instead its treatment of debt has been characterised by neglect and periodic large write-offs.

– Margaret Hodge

Govt under fire for 'failing to collect £22bn in debt'

An influential group of MPs has hit out at the Government for failing to collect £22bn in unpaid fines and tax as well as overpaid tax credits.

Read: HMRC 'loses its nerve' over big firm tax-avoiders

Unpaid debt
Failure to collect debt was hindering the Government's ability to borrow money, PAC said. Credit: PA

The Public Accounts Committee (PAC) was highly critical of the Government's failure to collect the unpaid debt, the majority of which (£15 billion) was owed to HMRC.

PAC, chaired by Margaret Hodge, was critical of the Government's failure to launch "a strategic, cross-government approach" to collect the £22bn, the National Audit Office announced the outstanding debt.

In its report, the committee warned that failure to minimise the volume of debt outstanding was having a direct impact on Government borrowing.

"We are concerned that the centre has taken so long to drive improvements in debt collection, given that this should be a basic business activity, and given the huge volume of bad debts that are written off each year."

Read: Talking to the taxman: £8bn clawed from big businesses

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'Less than half' of free schools submitted accounts

Under half of the UK's new free schools have submitted their accounts for the tax year 2011/12 to the Education Funding Agency (EFA), an influential group of MPs has warned.

The Public Accounts Committee was particularly critical of the following:

  • Al-Madinah School in Derby.
  • Discovery New School in Crawley, West Sussex, which was closed down last month.
  • Kings Science Academy in Bradford.
  • They said that these cases suggest that the Department for Education (DfE) and EFA's processes for overseeing free schools "are not yet working effectively to ensure that public money is used for the proper purpose".

Govt: Concerns about free schools 'misplaced'

The Government has dismissed criticisms of its rollout of free schools, claiming a scathing report by MPs into recent scandals is "misplaced".

A Department for Education spokeswoman said:

As the PAC has recognised we have made significant progress in implementing free schools, which are driving up educational standards and giving pupils from all backgrounds the chance to achieve academic excellence.

Many of the PAC's concerns are misplaced. Free schools are subject to greater scrutiny than council-run schools, they are overwhelmingly located in areas with a shortage of places, and construction costs are 45% lower than the previous school building programmes.

Those areas with a shortage of places but with no free schools receive extra basic need funding to make up for it.

– A Department for Education spokeswoman

MPs: Management at free schools 'not up to scratch'

Recent scandals around the Government's flagship free schools have shown how the management standards are "not up to scratch", according to the Chairwoman of an influential committee of MPs.

Public Accounts Committee Chair Margaret Hodge, Labour MP for Barking, said:

Recent high-profile failures at Al-Madinah School and Kings Science Academy demonstrate the DfE and the EFA's oversight arrangements for free schools are not yet working effectively to ensure public money is used properly.

The department and agency have set up an approach to oversight which emphasises schools' autonomy, but standards of financial management and governance in some free schools are clearly not up to scratch.

The agency relies on high levels of compliance by schools, yet fewer than half of free schools submitted their required financial returns for 2011-12 to the agency on time.

– Margaret Hodge

Free schools criticised for poor management

Poor financial management and bad governance are dragging down some free schools and leaving the Government to be overly reliant on whistleblowers to raise problems, an influential group of MPs has warned.

The Al-Madinah School in Derby had to stop teaching secondary school pupils in 2013 after failing Ofsted inspections.

The Public Accounts Committee raised concerns the Government did not have a clear idea of where taxpayers' money was being spent on the flagship policy.

There were also concerns over the lack of bids to open primary free schools in areas where more places for youngsters were desperately needed.

The report analyses the success and value for money of the free schools programme and says that the Government has made "clear progress" on the scheme - which is a key part of its education policy - by opening new schools quickly.

But it adds that the measures put in place for checking how these schools are run and whether money is being spent properly are not good enough.

Read: Free schools pupils were 'taught nothing' for a term

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BT broadband 'not impacting on rural communities'

BT is "not impacting on rural communities" despite winning all of the rural broadband contracts from the Government, the head of an influential committee has said.

Labour's Margaret Hodge warned other competitors "might be squeezed out" of the rural broadband market by BT's dominance.

Whilst BT claims it is making further concessions, this is not impacting on rural communities.

Local authorities are still contractually prevented from sharing information to see if they are securing best terms for the public money they spend.

Communities can still not access the detailed data they need to understand whether they will be covered by BT's scheme in their area.

Other broadband providers might be squeezed out of the rural market by BT's actions.

– Margaret Hodge

Read: BT accused of rural broadband monopoly

BT accused of rural broadband monopoly

BT has an "effective monopoly" over rural broadband after the Government awarded all of the 44 contracts from the £1.2bn scheme to the telecommunications giant, a group of influential MPs has said.

Read: Children's education affected by 'slow internet speeds'

Broadband
BT's position as a monopoly supplier should have raised a "red flag", PAC said. Credit: PA

Read: 'Rural penalty' marring country life

In another another scathing report of the rural broadband scheme the Public Accounts Committee (PAC) said the way it had been set up "failed to deliver meaningful competition".

This meant BT had been put in a strong position by the Department of Culture, Media and Sport (DCMS) making it more difficult for customers to insist on value for money, according to PAC.

Margaret Hodge, who chairs PAC, said: "Since our hearing in July last year, when 26 of the 44 contracts to deliver this were with BT, all remaining contracts have now also gone to BT.

"Despite our warnings last September, the Department for Culture, Media and Sport has allowed poor cost transparency and the lack of detailed broadband rollout plans to create conditions whereby alternative suppliers may be crowded out."

Read: BT's 'near monopoly' of rural broadband attacked by MPs

Royal palaces 'cost an absolute fortune' to maintain

Robert Jobson
Robert Jobson said Buckingham Palace needed major renovation work. Credit: Daybreak/ITV

Royal palaces "cost an absolute fortune" to maintain so it is not surprising the Queen's household has spent as much as it has done, a royal expert told Daybreak.

Robert Jobson defended Her Majesty for not doing more to reduce costs as palaces were already crumbling due to lack of upkeep.

"Basically, these buildings cost an absolute fortune to maintain, [Buckingham] palace in particular is crumbling in certain areas, has not been rewired since the 50s, certain rooms are not even decorated. This is a national monument in my opinion."

He continued: "It could possibly be opened to the public but the truth is that there has been a cut in real terms and so they had to spend the money where they could."

Watch: Renting Buckingham Palace 'could make more money'

Renting Buckingham Palace 'could make more money'

Buckingham Palace could be used to make more money for repairs Margaret Hodge, Public Accounts Committee chair has said.

Hodge also spoke of repairs needed at the royal residence, such as the boiler which has served the palace almost as long as the Queen and should be replaced due to the increasing costs of running it according the sixty-year-old appliance.

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