1.  Resource excesses in 2007-08 totalled £4.9 million (made up of a £1.9 million administration excess and £3 million of expenditure outside the ambit of the vote) and there was a £5.8 million cash excess. The resource excess is significantly less than the £102.7 million incurred in 2006-07, when there was no breach of cash or administration limits.

2.  The causes for the excess in 2007-08 were:

• The Department for Transport requested, and was granted, an advance from the Contingencies Fund for Crossrail expenditure prior to the Crossrail Bill receiving Royal Assent. Instead of drawing down the second instalment of this advance, the Department wrongly used voted supply funds without parliamentary authority.
• The Office of Fair Trading included a late provision in its Accounts for the likelihood of Her Majesty's Revenue and Customs (HMRC) reclaiming input VAT, causing expenditure to exceed the resource limit and administration budget.
• The United Kingdom Atomic Energy Authority (UKAEA) Pension Schemes included in budgeted cash income for the year receipts that were actually owing to the Consolidated Fund and thus under-estimated the Net Cash Requirement.

3.  In each case, the department identified administrative errors too late to request additional resources through the Spring Supplementary Estimates.

4.  The Department for Transport and UKAEA Pension Schemes have examined the circumstances giving rise to the excess vote, and will strengthen controls over the identification and treatment of draw down of funds and receipts respectively. The Office of Fair Trading is discussing with HMRC the potential VAT liability.

5.  The amounts to be voted are the lowest in value terms since the introduction of resource accounting and budgeting in 2001-02, and compare with the total spend by Parliament of £452 billion for resources and £409 billion for cash. The excesses do, however, cover four limits under resource based supply: resource; cash; administration; and ambit. Two of the breaches were caused by administrative error, for which the departments are introducing mitigating controls and strengthened procedures.

6.  Departments should ensure that their procedures are sufficiently robust to identify any administrative errors in time to correct them before the year-end and in time, if appropriate, to make a bid in the Spring Supplementary Estimates. In cases where departments have sought an advance from the Contingencies Fund, they should ensure that they draw down the cash from that Fund and not from general Supply. The Treasury should review its existing guidance over the use of monies from the Contingencies Fund and consider whether it needs strengthening in light of these particular circumstances.

7.  We recommend that Parliament provides the necessary amount by means of an Excess Vote, as set out in Figure 1.