The Public Accounts Committee chair sits right at the heart of Westminster, with the power to examine public spending across government. But as Margaret Hodge tells Matt Ross, she’s always felt like an outsider
Asked what lessons she took from her upbringing, Margaret Hodge doesn’t hesitate: “A passionate belief in equality; in creating equal life chances,” she replies. “And that came from always feeling like the outsider.” We’re sitting in Hodge’s wood-panelled study in the Palace of Westminster: outside the window the Thames sparkles in the winter sunshine, and one wall is lined with portraits of the establishment figures who preceded her as chair of the influential Public Accounts Committee (PAC) – rows of dignified-looking men, including a young Harold Wilson. Nowadays Hodge is one of the UK’s most powerful backbenchers: can she still feel like an outsider? “Absolutely: I have to pinch myself!” she says, wide-eyed. “My dad, if he saw me today, would be gobsmacked!”
Indeed, he would be surprised – but probably more by Hodge’s career path than by her success within it. For the MP’s family, immigrants to the UK, were ambitious, professional and business-minded. Her father and mother were Jews who, fleeing Germany and Austria respectively in the mid-1930s, met and married in Egypt – where she was born during the war – and had to escape anti-Semitism again after the foundation of Israel, finding sanctuary in Britain. Her mother died in the early ‘50s, and the 10-year-old Margaret Oppenheimer was sent to English boarding schools whilst her father built up a vast steel trading business.
That kind of childhood leaves an imprint – and Hodge emerged with a passionate commitment to creating equal life chances. She became a councillor in Islington – leading the council from 1982 – then entered Parliament to represent Barking, spending a decade as a junior minister under Tony Blair. But perhaps her defining moment as a politician came in 2010, when BNP leader Nick Griffin mounted a serious challenge in her Barking constituency.
Hodge had woken up to the threat in 2006, when the BNP won 12 council seats: “At every level in Barking – me, the council, the party – we’d become complacent,” she admits. “We had completely lost touch.” Rebuilding Labour’s support, she recalls, demanded “four years of relentlessly reconnecting with voters and building trust and listening” – and this, in turn, meant answering some uncomfortable questions posed by the electorate.
A race tinged by race
Rapid immigration was putting huge strain on services such as housing, and local people felt left out: Hodge’s solution was to talk about “fairness of access to public services, and that was really controversial at the time,” she remembers. Labour’s leaders saw voters’ concerns as tinged with racism, and scorned those backing the BNP – but Hodge, an immigrant herself, was comfortable arguing that access to services should be linked to “the length of time you’ve spent in the community, and what you put in before you get something out.”
In 2010 Hodge trounced the BNP, adding 10,000 votes to her tally whilst Labour retook every council seat. Are there lessons here for how mainstream parties should tackle the threat from UKIP? “Yes! A UKIP vote is often a protest vote, because people are fed up with the mainstream political parties – and it was the same with the BNP,” she replies. She has little time for policies that claim to constrain immigration: “People moving across borders is part of a global world,” she says. “Pretending you can cut it is rubbish because you’ll never deliver, and then you just destroy trust.” Instead, politicians must work to link access to services to people’s contributions to the community and local connections: “People get that – and I think it’s a powerful way of trying to make people feel more at ease with the movement of people across national borders.”
Hodge brought to her Barking campaign a formidable tenacity familiar to observers of her four-year stint as PAC chair. “I don’t let go of issues; it’s how I’ve always been,” she says. When questioning powerful figures, she says, “I never think: ‘Oh my God, there’s the chief executive of a big multinational company. He’s scary!’ I look at the issue and I just go for that.”
Company bosses, of course, see Hodge herself as rather dangerous: several have had very uncomfortable sessions before her committee, particularly over business taxation. But her indomitable chairing style, she argues, is designed only to tackle the problem – identified in a 2006 IPPR report – that whilst senior civil servants used to think it “scary to come in front of the PAC, it never changed the price of fish.”
Shark fishing
“That’s stayed embedded in my brain,” she says. “I’m determined that we change the price of fish!” And with that aim, she acknowledges, she does play to the gallery: “To shine a light, you’ve sometimes got to be a little bit more provocative, a little bit more theatre, than one might otherwise,” she says. “If we did it all in too dry a way, we wouldn’t be able to stimulate debate.” This theatricality, she argues, is a price worth paying for the result: “If you look at our work on tax, for example, we’ve stimulated a really important public debate.”
It’s not all theatre, however: as many witnesses have found, Hodge also gets genuinely irritated with those she sees as obfuscatory or uncooperative. “There are still people who come and think: ‘Can I get through this next two hours and tell them nothing?’ And that just riles me, I’m afraid, so they get that treatment,” she says. “People say I interrupt: I only interrupt when people are being repetitive, evasive, or wittering on. If people are direct, it’s a much easier hearing: I want straight answers.”
Many officials appearing before PAC have very positive hearings, says Hodge – take Major Projects Authority chief Norma Wood. Giving evidence on Universal Credit, “she was completely open and succinct and honest, and did she have a hard time? I don’t think she did!” Hodge also names Treasury permanent secretary Nick Macpherson as a “good witness” – things have clearly changed since 2010, when she complained to CSW that he’d treated PAC to “an hour and a half of very boring flannel” – and praises transport perm sec Philip Rutnam for being “so open and straight that we had a really constructive engagement” over the West Coast Mainline debacle.
It is telling that Hodge describes Rutnam as having “clammed up” when he returned to the committee to discuss High-Speed 2. On a live project, senior officials have less room to admit that things aren’t perfect – but the PAC chair makes few allowances for officials’ awkward positions: the truth must out, she says. After all, PAC and the departments “share a common purpose: to improve the delivery and value for money of public services, which is everybody’s interest – so openness about that is a force for good.”
She gets particularly irritated when departments submit requested information immediately before a hearing, or “suddenly, miraculously, have data which contradicts that in a report which has been agreed with the National Audit Office.”
This leaves PAC on shifting ground, undermining “the strength of the committee: that there are agreed facts on which you base the hearings.” And is the provision of data at the very last minute generally an example of cock-up, or conspiracy? For Hodge, the pause is a long one: “A bit of both,” she replies.
PACwoman explores a new maze
As well as raising the committee’s profile, Hodge wants to lengthen its attention span. PAC has begun holding “recall sessions”, she says, revisiting topics where it’s previously voiced concerns: these include rural broadband, the outsourcing of courts interpreters management, and severance payments. She also wants to challenge the perception that the committee is relentlessly critical, and these days the Civil Service Awards (run by this publication) include a ‘PAC award for most improved government body’ – won in 2013 by the international development department. Some committee reports are positive, she says, but she finds it “hard to get the stuff that praises civil servants up in the media.”
Meanwhile, Hodge is pressing for stronger oversight of government contractors – making them subject to Freedom of Information (FoI) laws, and giving the National Audit Office sight of relevant company accounts. The prime minister has consistently resisted her calls, but she’s trying to “persuade him and the government that if they’re going to have private companies delivering public services, we’ve got to be able to track the taxpayer’s pound.” Hodge adds that the big suppliers told PAC they’d happily accept such scrutiny: “I was amazed at FoI. I thought they wouldn’t like that one, but they didn’t object,” she recalls. In fact, “the companies have said: ‘We’re willing to release the data; it’s the departments that are stopping us.’ I have no idea where the truth lies, but that’s what they say.”
Such incremental reforms, though, leave untouched what Hodge sees as the structural problems weakening accountability in the civil service. “The old tradition of civil servants being accountable to ministers, and ministers being accountable to Parliament, is broken,” she says: technological, social and political changes have rendered it outdated. “Look at Universal Credit and the mess we got into there, with rows between the civil servants and ministers about whose fault it is and who’s accountable. It’s just a mess!” Such arguments further damage delivery, she adds: “When I was a minister, it was always clear to me that the way in which you best effected the policies you believed in was by working in partnership with civil servants” – but under the coalition, “the partnership between government and civil service has broken down a bit too often. That never makes for good governance.”
Under the current settlement, Hodge points out, “ministers feel furious when they’ve got to defend what they see as mistakes made by civil servants, and civil servants feel absolutely livid if they feel they’ve got to defend ridiculous decisions made by ministers – and nobody wins! That’s why I think you have to revisit the whole constitutional settlement about civil service and ministerial accountability, and open it up a little bit.”
The government’s promise to make civil service project chiefs accountable to select committees helps address the problem, Hodge believes, but doesn’t eliminate it. “I’m drawing breath here,” she says – her inner certainties for once fading to shades of grey – but she’s a tentative supporter of allowing secretaries of state to choose their own permanent secretaries. “You can’t say that civil servants are accountable to ministers who are accountable to Parliament if ministers can’t hire and fire those civil servants,” she says. “It’s a nonsense.”
However, Hodge doesn’t sound as confident on this as she has in the past: it’s just one option for reform, she says. Traditionally, she points out, permanent secretaries who fall out with their political masters are gently shuffled aside, “and I don’t think today, with the demands from the public for transparency in the way people conduct themselves, that you can say: ‘Well, we sort it in the old network’.” But wouldn’t allowing ministers to choose top officials exacerbate churn, weakening delivery and accountability? “I know, I know!” she replies, brow furrowed. “These are tough issues. I wish I was more confident about the prescription. It’s not a very good place to be, but I’m much better at saying what doesn’t work than what would!”
So what would work?
It’s refreshing to find a politician – particularly one with as strong an inner compass as Margaret Hodge – admitting that they don’t have all the answers. She’s not short of questions, though: “You’ve got these very strong departments and this centre of the Treasury, Cabinet Office and Number 10, all of whom run their own silos and have their own hostilities with each other. Yet it’s a very weak centre, and you’re running this multi-billion pound business,” she says. “Is that a sensible way to run a ship?”
So she’s supportive of a stronger corporate centre? “I think I am. I know they hate it!” she replies. “I think somehow sort out the centre so you don’t have three vying departments” – and, she adds, transform HMT into a genuine finance function that examines how money is spent rather than simply doling it out.
She is quite certain, though, that the civil service is in serious need of reform and development: “Since I’ve been in this job, I’ve probably become a bit more depressed about the capability of government to deliver,” she says. And she backs the Public Administration Select Committee’s call for an inquiry into the future of the civil service: “The greater the debate on how we want the civil service to work and the greater the cross-party cooperation on these isues, the better for everybody,” she says, arguing that an inquiry need not cause a hiatus in the government’s existing plans for reform.
Hodge also has strong views about the civil service’s attitude to senior recruits from the private, voluntary and wider public sectors: “There’s a suspicion of people coming in from the outside, which I think is sad,” she says. “There’s a suspicion and hostility, and at the top levels the civil service too often feels like a club; like freemasonry.” The system’s defenders would say people leave because they lack the skills required to operate in government – does that ring true? “No, I think they enter an environment which is hostile to anybody from the outside,” she replies. “People get rejected.”
There’s that feeling of being the outsider again – and it’s discernible once more when Hodge discusses the professionalisation of politics, talking of the “three boys, all of whom have done very well in their education; all of whom went to Oxbridge; all of whom went straight into politics; all of whom ended up as leaders of their political parties.” Ed Miliband, she notes, “strongly disagrees with me on this: he thinks the professionalisation of politics has strengths” – but in her view, it’s “contributed to distancing politics and politicians from ordinary people in their day to day lives.” That distance, in turn, leads to voters becoming disillusioned with mainstream politics and giving their support to fringe parties such as UKIP and the BNP. “We have to do our politics in a different way: not think that everything we do here is incredibly important, but really listen to what people want to talk about and respond to that,” she says with passion.
Margaret Hodge certainly does her politics in a different way. And the role of PAC chair suits her well: freed from party-political constraints, owing little to the establishment, it’s her mission to test and challenge powerful organisations in the pursuit of value for the taxpayer’s pound. It is, in short, a job for an outsider sitting right inside our democracy. “And there’s a load of stuff I still want to do, so I’m not giving up yet,” she says. “If your readers want me to, sorry!”
See also: Hodge: DWP kidding people over UC project