Cynulliad Cenedlaethol Cymru

Thank you. Our corporate plan provides a bit of a pivot point, I think, as you've just referred to there, Chair. I think there are three important strategic points to make. One is around the focus on three well-being objectives around nature, climate change and minimising pollution. Another area to mention is that we are, obviously, going through a restructuring to reprioritise, if you like, our work against those three important key areas of action so that we can pivot away, if you like, from doing things that deliver less for those well-being objectives and focus more on the things that only we can do, that we've been set up to deliver, and move away from things that other people can do perhaps in that situation.

That's not to downplay the important work that our staff have done over the years, and it's with a heavy heart that we give up some things, but we do think that, in the challenges and opportunities that we're facing, it's really important for us to focus on those things. And then finally, I guess the point I'd make in terms of the strategic level is that the additional funding that we are going to get for the next financial year will help us to invest in those areas as well, where they've been perhaps not as well funded in the past.

In terms of the multi-year planning, we have obviously put in place business plans with steps to take, really clear steps to take that we're taking, setting out our journey between now and 2030. We have key metrics to show the delivery against those steps to take in-year, and we also are bringing in this year some more business-as-usual metrics, because the comments that we've had in discussions with the Welsh Government and with partners is that we need to provide a little bit more information about the things that we would class as business as usual—so, things like our rate of permitting, our enforcement actions, our planning responses, to give a flavour of some of those things, as well as the metrics around the steps to take.

We've identified within the executive team a lead for each well-being objective to make sure that we are driving performance, both pace and investment, and making sure that, if we need to, we can rebalance across our delivery. And we are also holding with our board regular deep-dives to ensure that we are challenging ourselves about what we could be doing differently, how differently we could be behaving, and if there are different ways of working that will help us. So I think, with the performance management system that we've got against the well-being objectives and the steps to take therein, together with some additional information on our business-as-usual activities, we'll be able to show some trends in that multi-year planning, and that's all being led from the executive team.

There was a lot of management speak there; I think I followed. 

Sorry.

If I could add to that—. 

Yes, sure, sure. 

It's difficult to understate the shift here from where we were as an organisation and where we're going to be from the point of view of focusing on climate and nature, those two fundamental challenges, and actually challenging some of the fundamental ways of what's our delivery model, because a lot of our delivery model has been locked in the past, really, in the way we measure things and how we do things. So, we need to become a more intelligence-led organisation, focusing on how we do things differently. So, this moment is actually quite critical and will be seen as a way of actually putting up towards those challenges on climate and nature, and the response of Government to those challenges and how we handle them. So, it's—. At the moment, we've got three well-being objectives and we've added another one, which is actually how we do it, which is doing things differently. In my world, we call that fundamentally changing the delivery model, and that means a lot of change for a lot of people, but it means more focus for the organisation. Having got now a stable delivery platform, we now need to pivot away from some of that and actually move into a very different frame. 

And my question earlier was about the time frame. So, when would you expect to get to the point that you're trying to reach? 

So, I think we've done a lot of work this year and over the next number of months we're going to be consulting more with partners and stakeholders around that. So, what we want to be able to do is to build in some of these key further forward-looking metrics, and how we're doing against those, and the partnership working that Sir David refers to, working in different ways, over the next couple of months so that we can implement that through the next performance year.

Is the next performance year the next financial year? 

The next financial year, yes. 

Okay. Okay. You've touched on change and, obviously, it's a very different approach. You also recognise the need to build trust and confidence of colleagues in that approach, so how are you doing that? 

So, we've involved our colleagues very much in the development of the corporate plan, and partners and stakeholders as well. In reaching that pivotal corporate plan, we did engage very heavily, and also engaged staff in terms of the longer-term metrics and the things that we will use to demonstrate the change in performance. In the development of the forward-looking metrics that we're going to test in this next financial year, we've engaged staff in the development of those, and some partners as well, and we'll test it further in the next couple of months. 

What we've done, really, in that engagement and with previous staff surveys, if you like, is to draw out what are the issues that are being raised by staff and what are the things that we need to address. As Sir David has said, a lot of that now will be encapsulated in this fourth objective, which will be about how we work with people, how we're going to work differently and what we expect of our staff and colleagues in moving to that place. 

There is an issue here, which is that, if you look at the objectives around climate and nature, a lot of what we aim to do or be seen to be done is outwith our gift. So, we're looking to try and measure outcomes that are actually not directly affected by the levers we have. Other people have a large part to play—Welsh Government policy, people who occupy the land, et cetera, et cetera. So, sometimes, when people talk about measuring the outcomes, we have to be very careful about what we do and how we measure what we do and the efficacy of that, compared to what's being achieved out there on the ground in terms of the nature and climate emergencies. 

Obviously, you've been—. We'll come to the 'Case for Change' later, in terms of specifically asking about that, but NRW has been in a constant state of evolution and change and a state of flux, if you like, for many, many years and you outline now that, obviously, this is going to take at least another year, maybe, to bed in and settle. How is morale now, because, obviously, that's been something that we've asked about as a committee? How would you say the feeling is, or, if you take the temperature, how would you describe it at the minute, internally? 

It's a difficult process that we've been through, isn't it, this 'Case for Change' to reprioritise. And I think, as I said at the outset, that's not because the work that's been delivered over the years hasn't been of value; it's just that we're trying to focus in on those things that will achieve those well-being objectives as quickly as possible. So, it is a difficult time. 

And that's largely driven by resource. 

It has been, and the need to reinvest in those areas that we are uniquely best placed to deliver. Brilliant work has been done in some of those areas that we're having to stop and slow, to the credit of our staff. But we do believe that we need to invest in some other areas more—so, things like our work on biodiversity and conservation, our work on water quality, our work on flood risk management, our regulatory work. Those are things that we are in a unique position to deliver, so it's about that reinvestment in those. So, it has been a difficult journey. I think also, in terms of the 'Case for Change', to ensure that we minimise redundancies as far as possible, we've held a recruitment freeze. So, that has impacted other teams as well, in terms of their ability to deliver their work programmes, but we're coming out of that now. We're coming out of that now, and we're supporting our staff through that and coming out of that. We will be, very shortly, releasing opportunities for us to reinvest and take on new staff into new roles that will be focusing on that. So, I think the important thing is working with staff now.

Just to make it plain, this has been—. You referred to the past, and I don't want to go back there. All I can say is that I think, in the last two or three years, we have been a very stable platform of delivery, et cetera, et cetera. You can see that through the numbers. But we can't carry on as we are. Then we had the financial challenge, and, if you are taking 256 [correction: 233] posts out, plus other vacancies, people, despite being a highly committed, massively committed, workforce—they are wonderful people with specialisms and all the rest of it—they found it really tough, but our duty is to actually face the challenge and actually deal with it.

If we just ignored it and just said, 'Well, carry on', I'm sure that's not good governance, and the very worst kind of governance. So, we've had to face that and create a narrative for what this is all about. At the moment, we are at that pivotal point, as Ceri is indicating, where we've talked to our people, they have actually contributed massively to that corporate plan, where they want to go on nature and climate. But it's going to be a rough old 12 months or so. 

Sure. Okay. I'll come on to colleagues. There's just one more thing that I wanted to ask you, really, because I was interested in an update on the progress of your work to align your performance management framework to the corporate plan, and how work to develop corporate plan impacts and strategic indicators fits into that. We could spend a lot of time discussing this, but, interestingly, in your paper, you obviously recognise that staff resource has been diverted to the 'Case for Change', but you also say that you are waiting on filling a vacancy before you can progress that work. Which vacancy is that?

So, it's within the team—the team that was working on this and had done a considerable amount of work, actually, on developing those more strategic outcome measures that David referred to and the indicators below that. So, we've got a model that's ready to roll out. What we couldn't do was test it with our staff, because, obviously, they were focused on the 'Case for Change' and going through that process, and we didn't feel that it was the right time to test it with staff. So, as the vacancies now are being released, we will be able to recruit into those vacant positions and move this forward and test it with our staff over the next couple of months, in the first part of the next financial year.

I was just intrigued that there was a particular vacancy that was holding all of this back, really. I mean it's—.

Well, it's not just one vacancy. I think that it's the team that had led on the developments for the corporate plan are the ones who lead on our performance management framework—

So, they're no longer there, and they need—

No, they're still there, but they've been focused on the prioritisation in the 'Case for Change'. So, they've been working on that, working with staff on that area, and we just parked the work that we'd done for now. But we will now reinstate it and crack on—

So, it's not filling any vacancy. It's—

Yes, it's filling—

It's refocusing people's priorities.

It's refocusing people's attention now on to these, yes.

Okay. And when do you expect that to be filled?

So, in the next couple of months. We are releasing now the vacancies that are not required any longer, to balance out reducing redundancies. So, we will this week be going out with a number of vacancies that we can now crack on and fill.  

Okay. Diolch yn fawr iawn. Janet.

Diolch, Chair. Can I ask: why do we have an interim chief exec and a chief exec currently, and how long is that situation going to continue?

Well, Clare Pillman has been off sick—[Inaudible.]—

Oh, I am sorry.

—and is on the road to recovery, I think. That's why Ceri has been, wonderfully, acting up for us. 

Okay. So, it's going to be quite imminent that we will just have the one paid position as the chief exec.

Well, we've acted up people behind Ceri. So, we haven't accrued any extra. So, it's the organisation being flexible and adaptive in that sort of set of circumstances.

Thank you. The 2025-26 budget allocates increased funding to NRW. Your paper indicates that proposals on how you will use this funding will be put to the board next week. How have you prioritised allocation of this funding within NRW, and what trade-offs have had to be made?

Shall I take that one?

Yes. Rachael.

So, we—. It's quite a complicated picture, because, obviously, we went through the 'Case for Change'; we had a budget deficit at that point. As you may be aware, the UK Government's first budget resulted in a better settlement for Wales, and, as a result of that, we've ended up again with some increased funding in our 2025-26 budget. That has come through in various forms, and I'll just run through, if you want me to, to tell you where those things have come from. So, in terms of how the whole picture is made up, we get funding from Welsh Government, which is £141.5 million—this is 2025-26—we plan to raise charges of £48.5 million, commercial income will be £55.3 million, Welsh Government grants £43.8 million, and other external at £9.3 million.

So, we're looking at a total forecast budget of £298.3 million for next financial year. That represents an increase of approximately £32.5 million from the previous financial year, and that is made up of the following. So, we've got a permanent increase in grant in aid from Welsh Government of £17.1 million, which includes money that we got for pay awards that we weren't expecting. So, obviously, we'd budgeted for a certain amount, and, actually, we were very fortunate to get more through that settlement. So, that's an ongoing amount added into our baseline. We also got £5 million for the infrastructure consenting Act, which is a specific initiative that they wanted us to focus on. And then, on top of that, we've had another £4 million, which was earmarked by the NRW chair and the Deputy First Minister to look at very specific areas. So, that would be water quality, biodiversity, monitoring and evidence, flood risk management, and also our transformation programme. So, those are the areas that have been focused on. We also then have had a further £12.5 million in specific grants, and these relate to things like peatland restoration, waste reform, reservoir safety, coal tip safety and the sustainable farming scheme. And we've also had another £2.7 million of capital grant in aid, which is to develop our marine portal work further this financial year.

Thank you. The Deputy First Minister has told us he has allocated a £2.7 million increase in capital funding to support NRW's service transformation programme, particularly for marine licensing improvements and a new customer platform. Can you tell us how marine licensing is going to be improved and how the new customer platform will work?

Okay. So, if I pick that one up, you'll remember, I think, previously there was a marine licensing end-to-end review undertaken by the Welsh Government, and, as a result of that, there were a number of actions and recommendations that we put in place. So, what we've done to improve marine licensing, amongst a number of things that we've done, is focusing on the online experience, so that there's more information on the website for people, there's a road map, there's information that's more readily available for applicants and operators coming forward. We've reviewed our processes and our guidance to streamline the activities that we undertake and to provide much simpler mechanisms for our staff to undertake the licensing function. We've invested in further professional development of staff and training, making sure that we're looking strategically at our workforce to ensure that we can spot and fill gaps in expertise and experience. And we're also working with the Welsh Government on any particular legislative reforms that might be required. Because I think, as Sir David said at the beginning, sometimes the legislation is quite old, so we need to make sure that we're keeping it up to date and moving that forward. So, we have invested a lot in that.

The next step, really, is this platform for customers. So, it's about digitising it so that it's much easier for people to apply for a marine licence. We're looking at things like the Government pay portal, to ensure that that makes that payment element easier, and building this platform, which will be working with customers to build their experience into it, so, making it easier for them, making it easier for our staff, and using our information and data better, and making that more available to people, so that, when people are looking at developing in the marine environment, it's easier for them to find the information. So, we've had that extra £2.7 million to invest in that. We've done some initial testing stages, and we're now moving on to the next stage, really, which will use this £2.7 million to build and develop a solution that streamlines the whole of that process.

But I think, if I could just mention, we've had some really good success on things. The port of Mostyn was a good example of where the changes that we'd made, following the end-to-end review, meant that we could deal with what is a really important, strategically important, development, which was in a very sensitive area and, therefore, could have had a very negative impact on the biodiversity environment there. But we worked really closely with the operators, with the Welsh Government, extended the boundary of the special area of conservation, found additional mitigation, and were able to then license that operation really quickly and within the timescale that they needed. So, what we're starting to see now is some success from the changes that we've made.

Joyce, then, if you want to come in on this.

Yes. Just on that, there's an awful lot of potential licensing going to happen with green energy. I'm just wondering how equipped you are to cope with what could be coming your way and what sort of involvement you have at what sort of stage.

Okay. So, Rachael mentioned that, out of those sums of money, there was £5 million that we'd been promised, given, in the next budget onwards, and it is to focus in on those things, so that we can ensure that we've got a dedicated workforce that are trained and experienced, dedicated officers who can deal with the licence applications and grow their expertise, so that we can deal with that really quickly, dealing with the regulations, making sure that, if there are regulatory changes, we're feeding those through into Welsh Government so that they can plan those into that cycle, but also making sure that we're streamlining our processes. So, that £5 million that Rachael mentioned will be focused in on that decarbonisation workload that's coming towards us, so that we can deal with it as quickly as possible.

Yes. Okay.

Just to add to that, on a wider level, this is about organising around the people we serve, the customers. Doing sustainable development nowadays is more and more complicated for those who are seeking to do it. So, we are a regulator, and we're seeing more and more complexity. So, how do we make that as simple as we can for the people who are trying to do sustainable development? We organise around them, and the marine example is a good one. We're bringing in adaptive management. The old way was to wait for all the evidence to be drawn together; now we'd make the evidence come along at the same time. So, it's all about being adaptive and supportive of sustainable development, and that makes Wales more competitive. It actually brings development here, et cetera, et cetera. So, it's all part of the theme that the Welsh Government are pursuing.

Could I just add as well—

Just briefly, then.

—that, in developing up what we needed, we brought in people from outside to help us? And that's where we then developed up that bid for £5 million. So, we had Net Zero Industry Wales come in and help us work out what we needed to do.

Okay. Thank you. Janet.

Could you expand on the information in your paper, saying discussions are under way around building a case for investing in NRW delivery, to inform the next spending review?

Well, it partly refers back to the question we talked about and the corporate plan and the pivot that we're doing there, et cetera. So, the Deputy First Minister and I have been talking about some of the issues that we need to confront in that—and we've mentioned some of these already—which is about changing the delivery model, changes to the legislation, getting us more fleet of foot, et cetera, et cetera. There are also things we have to do, but there are other things that others have to do. We aren't just in control of climate and environment; everybody's involved with it. So, how do we encourage others to help do the lifting, how do we invest in that? And then also, talking in terms of working through different models, if you step back and look at green and climate and nature challenges, unless we get the private sector, the market, working in this way, we will not make the change we need. So, how do we encourage the market? I referred to sustainable development just now. We've had conversations with the Welsh development bank, which are still in the very early stages, with the Welsh Government, with the First Minister's office, about how you bring private sector funding into this that actually would help green development, et cetera.

A particular passion of mine is to think about how we've got investment bonds in other parts of the world, which are green investment bonds that the public invest because they want to make a commitment to nature and the environment. There's not much of that happening in the UK. It could be something, through the mechanisms in Wales, that we could explore more quickly. And I think, if you look at what came out through the green recovery taskforce during the COVID inquiry, which I chaired, we found all sorts of ideas coming from other sectors, particularly the private sector, about how they would like to get involved and move forward with these sort of items.

So, that, if you like, forms a bedrock of how we've started to conceptualise some of the ways in which not just we change the way we work, but the way the Welsh Government change the way they work, the priorities they set, some of the decision making they make, et cetera, et cetera. It’s complicated, but we, on our own, are not responsible for nature and the climate; I'm afraid we all are. And it's easy to point the finger at the regulator, but, actually, all of us need the tools to do the job.

Absolutely. Okay. Thank you. Yes, Rachael.

Just to build on that a bit, I think the last time I came—actually, you may not remember—but we were talking about the baseline exercise in service levels. So, our intention now is to build on that work and work with our Welsh Government colleagues. They are very keen for us to look at a case for investment for Natural Resources Wales, to inform the next post-election spending round. And that will be a bit different to what we've done in the past. It will be more about going forward, not actually baselining where we were. And I think, for me, that gives us a big scope for improvement, and I think the stuff that Sir David is talking about would factor into some of that thinking.

So, are you saying that that service level approach that you adopted on certain areas of work is—? Because that was paused, wasn't it, after a certain—?

Yes.

Is that journey starting again to take it further?

It will, but it will be slightly different. I think it's going to be a bit more of a case for investment rather than, you know, a service level approach.

Okay. Yes.

And it will be a more integrated and holistic approach, looking at our end-to-end services. I don't want to get into the detail, but, before, it was very siloed into actual functions and how we did stuff, but we look need to look at the end-to-end. And I think there are some really positive examples of where giving NRW extra money has made some massive differences. So, for example, on the peatland programme, you know, we've had—. Originally, we were looking at 600 hectares per annum. We've now been able, with extra funding, to increase that to 1,800 hectares per annum, which means that the Welsh Government peatland targets will be, you know, delivered a year early, and that's saving more than 8,000 tonnes of carbon a year. So, we can deliver on it if we're investing in the right places, and I think that's the thing for this case for investment.FootnoteLink

Okay. Excellent.

If I can just use the example of—

Very, very briefly, then.

—the Teifi catchment area project, where we, with Welsh Water and the Ofwat regulator, ourselves have initiated this multistakeholder approach to a project, which is about changing the way you look at water quality and the catchment approach to it. And we've actually got an application in with the National Lottery Heritage Fund, which has got through its first stages, to fund that sort of work. So, we're thinking radically differently about how you do some of these things.

Okay. Thank you. Right, we need to make progress, I think. We're a third of the way through our time and we're not anywhere near a third of the way through the areas that we want to cover. Carolyn.

I'm going to ask you about the visitor centres. There's been a lot of public concern regarding those. We've had two petitions and a debate in the Chamber regarding those. So, Case for Change is regarding the retail and catering facilities of the visitor centres being maybe managed by somebody else. But there is concern regarding closure, so there's not a seamless transfer over to any interested parties. So, can you give a timeline for the public tender process for the interested parties at Nant yr Arian and Coed y Brenin? How long do you anticipate the facilities will be closed, as well, after March? So, if you could start with that answer, please.

Just a quick point, for us, it's a difficult decision and, as part of the budget challenge, this is a lower priority than some of the things we've just been talking about. These forests and places are not being closed. Let's be clear about that—absolutely not being closed. What is being looked at is the closure of cafe facilities and shops, which, actually, we've been running. It's near enough £1 million a year that it's been costing us to do that. So, we're looking for other partners, if they wish, to take some of those facilities over. But other facilities will still be available. The forests are still there, et cetera, et cetera. So, that's the only issue we're talking about.

We've had to wait, for some legal reasons, to actually stop the facilities and then start the tender operations. We hope to move to a position in the next few months to actually—. We've had already, I think, one procedure close, we've got one applicant looking forward to one place, and we hope to do that and move as fast as we can on that. So, we appreciate the feelings about it, et cetera, et cetera, but one has to say that we weren't doing massive business in these shops and cafes—they were a big loss maker—and given the challenge to the budget, we had to look very seriously at those.

I understand that, but people that would like to run it, they feel they could run it well.

Yes.

And they'd hoped that they would be able to take over quicker so it would be seamless and they wouldn't close, especially with spring coming and summer. They're very important facilities for tourism, for people that go and stay there. So, that's a really big concern to them. Do you want to respond first on that?

Yes, I was going to say we've had, as you know, a number of public meetings to keep people up to speed about the timeline and what we're looking at. In the meantime, at the moment, on our website, there's the opportunity for people to express an interest in the interim period, which is around concessions, a coffee stand in facilities—the same in Ynyslas, Coed y Brenin and Nant yr Arian—so that we're not losing customers, if you like, before the opportunity arises for people to take them on in the longer term. I think the thing that we want to have that conversation with interested parties about is exactly what they want to take on. Is it just the coffee and retail, or do they want to go beyond that? And it's allowing people, really, that time to think about what is the business that they would like to run from that facility, rather than just being, 'We're stopping coffee and retail, and that's all that's on offer.' So, we will have these concession stands in the interim period, and then, as Sir David has said, early in the next financial year, sometime in April, we'll start to go out and have these conversations about what it is that people are interested in doing on these facilities.

Okay.

Julie just wanted to come in briefly on this.

I think one of you said 'just a cafe', but that is so important for people, for example disabled people, who visit the site, in that it's much more than a cafe and a building, isn't it? It opens access to a whole load of people who wouldn't go there unless they knew there was somewhere to go inside or there were toilets available. So, I just wanted to stress that, really.

Okay. Toilets and all of the other facilities will absolutely be open. So, the trails, the walks, the mountain biking, the toilets, they will all continue to be open as they are at the moment.

Okay. So, I visited Ynyslas on behalf of the Petitions Committee, and they just have a coffee point; it's not catering there. But it is a really important centre for nature conservation. The appointed catering staff, they actually do a lot of things regarding managing the site. So, if the boardwalk collapses, they fix it; they look after the wildlife there—there's a red-list, protected ringed plover; and they advise visiting public of dangers to life, because it's a red-flag status there with the changing tide in the estuary. So, I'm really concerned because they're not actually catering staff, and it's a different type of centre as well. So, if nature and climate change is a priority, they're really concerned that this particular education centre, which is really important for conservation and nature, will be closed. I believe that there will be one member of staff, possibly, there on site, but I'm not sure if they'll be doing any work there. So, just concern regarding that.

And my other question is regarding car parking charges. So, we believe that there would have been a good business case if car parking had been managed properly. You'd have had a decent income from it. Very concerned if you're bringing in an outside company, like NCP, that would charge and then keep the revenue for managing it, and I believe that those that will have to take over the running of them, if they could keep some of the revenue from car parking as part of their sustainability, going forward, to help manage it, it would be much better. So, I just wanted to make that point to you.

Do you want to respond to that?

Yes. Okay, so, on Ynyslas, it is a completely different site to the other two. It's part of the Dyfi biosphere. It's really important, it's a national nature reserve, and our land management staff will be there looking after that as a national nature reserve. So, those activities that are needed to keep the status of that will continue through our land management teams.

We have an opportunity that just closed at the end of January for a community interest group to work with us with regard to Ynyslas, to use that as a community space. And we have had somebody interested in that, and we’re working with them now about what that could look like going forward.

And we have, on our website, expressions of interest available for managing the car park, and also the usual concession stand that’s there usually; it’s an ice cream van. But there is that opportunity available at the moment for people to express an interest in.

So, we will be, through different mechanisms, trying to find ways through, but I think, in terms of the importance of the nature reserve, that will be with our land management teams, who will look after the nature reserve and what’s required to keep it in the condition that it needs to be in.

So, an outside company is going to be charging for car parking.

Parking was—

We’re just giving an undertaking that we’re out looking for expressions of interest. We’ll talk to anybody who’s got that from the community, and we’ll bring all those issues into the conversation. So, we’re not rushing to a private sector supplier. We’re actually looking to community organisations, what sort of package we could do, how that would work. So, we’re conscious of the importance of these things, but we’ve had to take the decision on priority. But we’re really happy to talk about the issues you’ve raised in those conversations with communities.FootnoteLink

Okay, thank you. 

Okay, thank you. Thank you very much. Right, we'll move on now, then. Joyce. 

So, just on Ynyslas, I just want to reiterate and support my colleague Carolyn, because people are concerned, and it has to fit—I know you know that—with your own remit.

So, we’re moving now to a 'Case for Change', and it’s been briefly mentioned. But could you enlighten us about the proposed reductions in enforcement and development of regulatory approaches, and what do you expect will be the outcome of that?

Okay, thank you. So, enforcement is obviously an important part of our role, but where we want to put more investment, if you like, is in the preventative work that comes ahead of that, because when we’re in the enforcement territory, the damage has already been done. So, what we want to do is to spend more of our time with operators and organisations to ensure that they comply with the requirements, and then we don’t need to take enforcement action.

Enforcement is one of those areas that’s wholly funded through grant in aid. So, we have had to take some measures to cut back there, and it was approximately 6 per cent that we’re taking out of that element of work. We are, though, streamlining our processes to ensure that we can continue to do the best we can with the investment that we are continuing to make in enforcement, and also to ensure that we have different mechanisms available to us. So, we are still talking to the Welsh Government about extending civil sanctions powers, so that, across all of our regimes, we have more opportunity to use civil sanctions for some of these lower order offences, rather than it being either just advice and guidance, or prosecution at the other end.

So, I think there’s ways that we can mitigate the impact around scaling back on enforcement, but I think the important thing is that we’re trying to protect our work proactively with organisations, to stop them from defaulting on the requirements in the first place.

I understand that, but there’s nothing like examples of, ‘If you don’t, we will’, and that’s really what sanctions are. They send a clear message that action will be taken, and we’ve seen an awful lot of examples of pollution, which is also wrapped up in the climate emergency. So, people and, particularly, water courses suffering as a consequence of action on the land, because the river beds are drier or wetter, whichever the case might be. So, I still think, and I want some assurances, that, whilst I agree that you need to prevent these things, because, by the time you’ve got sanctions, the damage has been done. We understand that. Nonetheless, we need to be assured that, when people need sanctions and the powers behind them, that will still happen.

Absolutely. We will still take action where we believe absolutely that there's been a significant offence, a significant impact, and where it sends out that deterrent message. And just to give you some reassurance, between 2023 and 2024, we saw a 30 per cent increase, actually, in the enforcement action that we undertook, because we'd had additional investment in things like the agri-pollution regulations, we've been taking more actions around that. So, we will still, absolutely, prosecute where it's in the public interest to do so. We will need, I think, to do a little bit more work with the courts, because one of the things we have seen between 2023 and 2024 is a dramatic decrease in the level of fines that have been levied. So, we do need to spend some time, I think, working with the court system around that. But I think, as I said, if we can also work with Welsh Government to secure more civil sanctions, it means that we can take restorative action on the ground when these things happen, if they don't meet the bar of needing to go down the prosecution route. So, that's certainly something we're asking for. 

Okay. I'm going to move on now to flood-risk management services. I want to try to understand the total amount of savings that you've made or you're going to make within those services and whether that will have an impact on the level of flood-risk management service that you provide, or can provide.

Can I take that? So, as part of the 'Case for Change', we've identified £1 million of savings within the flood-risk management service. This is by permanently removing identified vacant posts from the structure. So, we had vacant posts that were there already and we've just taken those away. It represents a 5 per cent reduction in the overall budget, and if we hadn't done this, then we would have had to ask for deeper cuts in other areas. So, other things like water quality, biodiversity and conservation. So, at the time, we felt that that was the right thing to do. However, we did recognise that our flood risk service is an absolute core duty and that we are facing more and more flood events because of climate change. So, as a result of that, the extra funding that the chair and the Deputy First Minister had agreed, we were able to put back into that service £1.1 million, which meant that they didn't need to find any further savings. 

Having said that, we've asked them, our flood team, to refocus and look at how they can look at different ways of doing things. So, more strategic catchment planning, community engagement and resilience and the nature-based solutions. So, overall, we believe that we can still provide a really robust flood service, but it will mean some refocusing into different types of work and how they do things, which we think, again, is the right thing to do and is in line with our corporate plan. 

And, of course, you're land managers as well. 

Yes.

And managing that land well will reduce flood risk, and part of that, of course, is tree felling—but I think we're coming on to that—and land slips that happen as a consequence. But I think that's for later, so I don't want to take somebody else's area. But in 2020 you estimated that 60 to 70 additional members of staff would be needed over the long term to sustain flood risk services and deliver improvements. So, do you have the resource to address that challenge that you identified yourself and also to deal with, as we all know, the frequent and severe floods that we are experiencing and are yet to experience?

Do you want me to pick that up? Clearly, when we did our review after the 2020 floods, that's where those figures have come from, and we have improved some really key areas. So, for example, we improved our incident response capability. We've now got incident response capability built into roughly half of the roles across NRW. So, staff have got a contractual requirement now to be part of our incident response. We've staffed up extra on our rotas to ensure that we are able to cover, because we are a category 1 responder, and we take that really seriously so that we are able to respond to incidents, including environmental and flood incidents.

We are looking as well—. I think the important thing to mention is that we're working really closely with other flood-risk management authorities, like local authorities and Welsh Water and others, to look at how we can work better together. Gareth and I were talking with the Welsh Local Government Association just last week about, where we’re both on the ground, whether we could be less bothered about whose asset it is and that whoever's there could be trained up to deliver—closing that floodgate, sandbagging that floodgate—rather than it necessarily being, if it's an NRW asset, it has to be us. So, they are the conversations that we're having with those other flood-risk management authorities to ensure that we're working really well together so that we're not all turning up at one place and then not turning up at another. So, there's a lot more, I think, that we can do working collaboratively with others. And the Welsh Local Government Association discussion last week was really positive in terms of willingness to work with us on that.

So, we are still investing in our flood risk management—it's a core function for NRW—particularly around defences that are built, maintenance of those and also the flood warning system. So, we are developing those, but we do need to recognise that we've got to move more to these catchment solutions, because we can't build our way out of this any further. So, it is about catchment solutions, helping, when we issue warnings—us, the Met Office, the Flood Forecasting Centre—so that people know what to do when those warnings come out so that they can help themselves. And then also using nature, if you like, to deal with some of these issues that we're facing, more than perhaps we have in the past.

Part of that is understanding each other's roles, and we did hear from the leader of the WLGA of an incident in the Rhondda where they needed to take action to prevent further flooding, but were also in fear of being charged with environmental consequences of the action that they had to take getting in the way. They did it anyway, but there was a fear there that they could end up in court as a consequence. So, since you've met with them, only this week, I think you said, have you had discussions around those eventualities going forward, because we could have ended up in quite a difficult place?

We'll be interrogating some of this later on, but maybe if you could respond to that.

I'll be really quick. So, there's been a huge piece of work, working with the local authorities and others, since the 2020 floods when that slip occurred and that difficult situation prevailed, such that now there are protocols around predicting where that would happen potentially, and then what action we would do together, so working much better together around those things. And so it's not just over the last number of weeks—this has been since 2020 with the coal tips protocol work that we've developed up around all of that now.

Okay, thank you.

Okay, and we'll be pursuing that for a bit more time later on. Janet, did you want to pick up here?

Yes. Could you explain why you've decided to change your response to pollution incident management? And let's be honest, it's pretty serious—some of the pollution incidents we're well aware of, where it's felt that very little enforcement has taken place. How will it enable you to take more effective action in this area?

Okay. So, as I mentioned, we're a—

Yes, you touched on this earlier.

—cat 1 responder and we take that really seriously, but we're not a blue-light service, so the work that we do when we're responding means that we'll have less resource available to do the prevention activity. So, what we're doing—

I'm more about whether you've got absolute proof that pollution on land is taking place.

Yes, so in those areas, then, we will absolutely—. If we can make a difference, if we believe there is a significant incident and we can make a difference, then we will be still responding to those. And our stats are quite good on this: we've got a target of 95 per cent within four hours, and we've actually exceeded that in the year that we were looking at for this annual report and accounts—we outperformed that. But the important thing is that we make sure that we are responding to the ones where we can make a difference, whether it be through taking action or—

Yes, I'm more about the enforcement side of things, so that the polluter knows and actually that you're able to address those polluters.

Yes. So, that—

Take them to court, I suppose, I mean.

Yes. Yes. And we will be doing that. But that does also link into my earlier point about civil sanctions and being able to take different types of action, issuing enforcement notices, restoration, making somebody who’s polluted clean that up on the ground. So, we are pursuing those actions, but, for the significant pollutions, we will be still focusing on those. But what we want to do is to spend some of our time also on pollution prevention campaigns, education, and trying to ensure that operators don’t cause that damage in the first place. So, some of the resource that we have been using on lower level incidents we'll be focusing on that pollution prevention activity, moving forward. 

It's fair to say, in my view, that sanctions, penalties, are not high enough.

Well, that's my view as well.

And so—. But this is not within our gift here; we have to work with others. We would be urging those who are engaged in this to actually raise the penalties to a level where people take them really seriously, because at the moment—a personal view—I think it's an area we've got a lot more work to do in.

I think so too, and I also believe that any moneys—. So, if you take someone to court and you give them a hefty fine, which they deserve for polluting our environment, that money should not be going to the UK Treasury; it should be coming back to Wales so that it helps—

Hear, hear.

Yes. I agree with it.

I have raised this issue with the Deputy First Minister, actually.

Okay, thank you. Fine. Maybe we can move on. I think time is against us, so, maybe, Julie, you can come in now.

Yes. Thank you very much. Bore da. I’m going to ask you about the HMRC tax liabilities. So, in your paper, you say that the Deloitte report was going to be considered by the board in February, so I wondered if you could tell us what has happened there. And I think you also said that Deloitte would then write to HMRC setting out the liabilities—well, the extent of the liability accepted by you—so could you update the committee on what happened, and where we are?

Absolutely, so I’ll start off by saying this is a really difficult and contentious issue, as you’re well aware, and we’re not alone; many public sector organisations have gone through this, which was part of the reason for choosing Deloitte, because they have a track record in advising other organisations in this position. But, as you say, significant progress has been made, and, as you said, we went to the board in February with a report that set out what we thought the potential liability could be. The board accepted that report and, as a result, that has now gone to HMRC, who are considering it. And essentially, that sets out the position on off-payroll contractors and what we believe to be the full liability. So, they will consider that now and come back to us in the near future with some resolution on that.

Are you able to tell us—

Could I just add to that? Sorry. This is not just us. We are amongst many, many—. Google it, and you'll see a long list of public sector organisations who are in this position as a result of very different interpretations of rules that the HMRC put down then changed et cetera. I won't go into the detail of that, but it's a very complicated area. We appear to be the first one in Wales that HMRC have taken an interest in. I don't know of any others at the moment, but our sense is that there will be others coming along. It is an issue that has been very difficult for us and there are some questions we need to ask ourselves about could we have approached it differently, which we're doing at the moment, as a result of various studies we've had done of it.

Yes. Well, thank you for that. Are you able to tell us any more about what extent of liabilities you've accepted?

Not directly, because that's in the hands of HMRC. All I can say is that, obviously, we paid £19 million—well, Welsh Government paid last year £19 million on account—as we felt it was in the region of that quantum, and, the report that went forward, we are still believing that it's in that quantum. But, obviously, that will be subject to the HMRC calculations that they do on the evidence that we've provided to them.

Right, yes. Well, thank you, Sir David, for saying that you did look at yourselves—

Yes, indeed.

—as well as saying that there were lots of other organisations. So, looking at yourselves, what did you come up with?

Well, I think there were two things. One was: could we have taken action earlier? Because we took legal advice, which was alongside other legal advice other organisations had taken, and you work on the best legal advice you've got available. Should we have been more aware of it earlier? Probably yes. But, actually, would it have made much difference to what we're talking about now? Probably not. But we've made sure that we are absolutely clear that, in terms of employment now, we have none of the issues that had affected us through IR35 and the way we employ people. So, that's been setted. But it's a very contentious issue. Anyway—. If you've got a couple of hours, we can talk about it and the different views on it from different organisations and HMRC. It's just one of those areas where there continues to be a dispute, but we recognise what we have to do and where we are.

I would like to add, though, that we’ve been having weekly meetings with HMRC and Welsh Government on this matter, and we have a good working relationship with HMRC now. So, I am fairly confident—well, very confident—that this will be brought to a close fairly soon.

Right. In terms of the future repayments of the loan balance to Welsh Government, what are the terms of that proposal and have you reached an arrangement with the Welsh Government?

We have reached an arrangement. So, we will make an interim—well, not an interim, a first—payment this financial year. So, in the 2024-25 financial year, we'll make our first payment back to Welsh Government, and then we've agreed that, from the next financial year, 2025-26, there will be a budget reduction. So, instead of us paying it back, they will just reduce our budget accordingly on the balance that's left, divided by 10 years. So, we will be paying it back over a 10-year period. 

So, just to be clear then, this money is being paid back to Government out of money that would ordinarily be available to you to deliver your services. 

Yes. 

It's not additional.

No. 

It's from— 

No, we have to pay it back. 

—your budget allocation. 

Yes. 

So, that will result in a reduction of services somewhere.   

Well, I think we’re trying to absorb that through efficiencies and making ourselves much better at what we do.

Which is what that means.

Absolutely. So, we’re not cutting anything as a result of this. So, we will be looking for efficiencies within what we deliver to make sure that services aren’t affected.   

Right. And obviously this did happen, for whatever reason, and the Deputy First Minister recently said that enhanced monitoring arrangements are now in place to provide assurance of the Welsh Government’s oversight of NRW. So, could you tell us what these arrangements are and what you—? I think, Sir David, you've said some of the things you thought perhaps you should have done. How are you going to make sure this doesn't happen again? 

Well, we have a number of steps we’ve taken already. And let’s be fair, the oversight issues triggered by IR35 are appropriate and the DFM and I have reached agreement about what those are. There’s a series of objectives, if you like, and monitoring measures that are in place. We have a risk register—always have had a risk register the last few years—and that is, again, more transparent, I think, to the board and to the Welsh Government. There are a number of other steps we’ve taken, particularly in relation to off-payroll contractors. Lots of organisations have used off-payroll contractors for many, many years, and these regulations have affected those relationships. We don’t do that anymore, and so that’s been settled. And also, it’s actually been helpful to just review the way we work together with Welsh Government, and, actually, to be able to share to the DFM some of the constraints we see in the way we operate.

We’ve touched on the budget and the annual nature of the budget. I’ve always been a passionate advocate of multi-year planning in public sector organisations. It appears congenitally incapable in government at all levels to be able to do that. But we should be aiming for five-year rolling programmes of expenditure that we can all understand, so we’re not constantly going in and out of cuts and then growth and in and out again. So, there are lots of things to learn on both sides, I think, here. But I think the DFM and I are feeling very pleased at the moment with the, if you like, greater transparency between the sponsorship branch and ourselves, and also, in my regular meetings with him, we have a touch point on all these issues, which, again, is helpful, and we can feed back to them our perspective on some of how Welsh Government is operating.

And that plea for longer term funding is one that this committee has made as well on a number—. 

Yes, I know, Chair. 

Very, very, briefly, then, because we do need to move on. 

Yes. Just to make a point on the multi-year funding, so, as I mentioned before, we do get grants that are for long periods of work—they go over 10 years sometimes, if not longer—so, our assumption now is that those grants or that work will continue in place, unless we're told otherwise. So, we're about to—. We haven't yet, but we are writing to Welsh Government to say that, in the past, we were planning for those annually, but, actually, we are assuming that those things will carry on. And they've verbally told us that this is their assumption too, but we just want to formalise that. So, that will allow us to plan, in some of those large projects, on having that money for a longer period of time. 

And just finally on this, then, we can be sure that the tax liability will be no more than £19 million?

it is in the hands of HMRC, so I don't want to make that statement, because, obviously, at the moment, they're just still considering the calculation. 

But that £19 million was a figure arrived at for a reason, I'd imagine. 

Yes, absolutely. That is our assumption.

Yes, I don't want to tempt fate here.

We're constrained by the legal process we're in, so you'll appreciate that.

Of course. Thank you. Diolch yn fawr. Delyth.

Diolch, Cadeirydd. Bore da. I wanted to ask you some questions about the environment governance principles et cetera Bill. Firstly, please, have you had assurances from the Welsh Government that any new responsibilities that are conferred on you will be met with new resource to help you, like for monitoring the new biodiversity targets, things like that?

Okay. So, at the moment, it's early stages, I think, to get to that commitment, because, as you'll know, the Bill itself and the detail of it are still in design. So, we're working really closely with Welsh Government around what those targets could look like, what the role will be for NRW. Will there be an extra role, for example, in terms of reporting using SoNaRR, 'The State of Natural Resources Report'? Will there be extra work for us to do around new designations, notifications, management plans and monitoring? The discussions are under way. I think Rachael mentioned earlier, and Sir David, about setting out the case for investment. So, I think when we get more detail on what the actual detail of the design is for the Bill then we will be able to have those discussions with Welsh Government. But also, some of those activities we do at the moment, so it'll be reprioritisation as well to come into that discussion, because some of these things we already do, but we'll be doing more of it and on a bigger scale.

That's really useful. Thank you. Presumably, for those elements where it would be additional, so more of it, or a bigger scale, as you say, you will be expecting, at least, that there would be additional resource coming in to help you with that.

We would certainly be making a case for investment in that area of work, yes, absolutely.

Okay, thank you. Do you have any concerns about your ability to deliver, or any aspect of—? Again, I appreciate that this is early stages and you're still very much in discussions. But do you have any concerns about any aspect, as you see it at the moment, in terms of how you could deliver any of it, particularly looking at the nature recovery framework?

I think one of the areas that we have identified is around monitoring, and, as you'll be aware, there was the biodiversity deep-dive, and I had the benefit of chairing the monitoring and evidence expert group there. We were quite clear that, whilst there is a lot of information available, not just from NRW, but from a range of organisations—and we can, no doubt, make better use of those arrangements and that information—there are also some significant evidence gaps that need to be filled. We were really clear that that is an area that is going to need some sustained investment. So, we've had a little bit of extra money this year for NRW's inputs on monitoring from that £4 million that Rachael mentioned, but there's a more significant conversation to be had about that whole monitoring of the targets, the condition, the additional sites that would make up the 30x30 commitment. As an expert group, which involved a range of stakeholders, we were really clear that that's a significant investment conversation that needs to be had. So, I think that's one area that we would be pushing forward.

Okay, that's useful for us to hear. Finally from me, we often, in discussions with you and when we take evidence from you, have discussed the fact that the public knowledge of where your functions begin and end—. Well, it's come up today already that that isn't always clear, and there are different bodies in Wales who have sometimes overlapping functions. How likely is it, do you think, that the new governance body could overlap with your functions, like in providing advice to the Welsh Government? If there are areas, how would you seek to mitigate that?

Okay. Well, I think the fact that we've had the benefit of operating with an Interim Environmental Protection Assessor for Wales has no doubt helped us to sort out where their responsibilities start and end and ours start and end. We've worked really well with the interim assessor. We've also got the experience of sister organisations who work with Environmental Standards Scotland and the Office for Environmental Protection, so we can learn from what's been the practice there, because we know our interim assessor has had different powers than will be conferred under this legislation. But we're confident that we can sort that out. The thing for us is that there will be a co-operation duty on us to co-operate with it, and we would take that willingly, and, obviously, enforcement as well, because they will have enforcement powers. So, there will be work to be done, but I think it'll be around setting out clearly where those responsibilities complement each other, rather than overlap.

Okay. That's a nice way of putting it. Just finally, as well as what you're saying that, behind closed doors or behind the scenes, you're confident that you'll be able to sort that out, are you concerned about how the complement, then, will be perceived by the public, that the public will know where to go about different functions, things like that?

I think what I would suggest is that we need to do some strong communication around that as a group, because I've heard that stakeholders and partners have been worried about the relative roles of NRW versus the new body, versus Audit Wales, versus the future generations commissioner. So, I think, with the new legislation, there's a real opportunity for us to go out and promote how you access where you need to access to raise your concerns, and we'd gladly, willingly be part of that communication so that we can help. But, at the moment, if people come to us and we think they need to be at the IEPAW, we will focus them that way. We're not just going to say, 'Well, that's not for us'; we will route them to where they need to go.

Thank you.

Diolch yn fawr. Okay, we have 15 minutes left in the allocated time, and I'm going to invite Carolyn to take us on to the next area, and maybe, Janet, I know you want to come in on something else as well, but we might have to condense our questions a little bit. But Carolyn first. Thank you. 

I've got questions on protected sites. You've answered some of those already, so I'm just going to ask about the budget for section 16 land management agreements, which we were told has been reinstated. So, has this budget been translated into contracts for the landowners again? And to what extent are these land management agreements improving the condition of the sites? And can I also ask, does this include landowners such as the Wildlife Trusts, because I know they've raised with me previously that they weren't able to get the section 16 land management funding? I don't know if you'd know that detail.

Okay. So, we invest around £1.2 million in land management agreements. We had scaled that back a little bit, and then the Welsh Government provided us with an additional £400,000 a year for the last year and the next year, which takes us back up to that £1.2 million level. We haven't been able to spend all of that money, because some landowners decided not to accept and move forward, because I think there's a lot at play at the moment, isn't there, with what's coming out of the sustainable farming scheme and which route to go down. But I think what we've been really clear on is that not everyone will enter the sustainable farming scheme—some won't be eligible to—and, therefore, there'll be a role to be played with the land management agreements. So, we will be looking to take that further forward. Again, I think that that's part of the investment case that we'll be making to ensure that we do have a mechanism to deliver that, because those land management agreements do deliver great benefits in terms of the conservation, biodiversity, water quality and keeping stock out of rivers by fencing, and they are important elements of work, so we do want to continue with those. And we'll be looking at our own budgets as well to see what we can do.

What we have used, as well, is money that we've been given through the grant funding mechanisms from the Welsh Government for things like water quality and peatlands, to also use those mechanisms to fund land management agreements. So, we'll continue to be as flexible as we can be around that, but we think there is a case for them continuing. And I'm sorry, I don't have the detail of the—. But I'm happy to find out and come back to you.

Maybe a note to the committee would be useful.

Yes.

Thank you. Yes, I think it was because they were told that you were waiting for the SFS to be worked through, so these payments weren't being made if you weren't going to enter that scheme and you were just managing land for biodiversity—that was the issue.

Okay. I'll find out about that and come back to you.

Great. Diolch yn fawr. Thank you. Janet.

Thank you. Tree planting rates in Wales remain considerably below the Welsh Government target, so what are you doing to increase tree planting rates, both on the Welsh Government woodland estate and more generally?

Okay. So, we have a dedicated team that deal with the woodland programme, which is about extending tree planting and speeding up tree planting. They, obviously, have to ensure that, in the role that we undertake, we’re assessing whether or not they meet the scheme rules, which are set by the Welsh Government. So, we work really closely with the Welsh Government on that.

We are aware that there has been some criticism about the slow speed of getting these agreements and permissions in place, so what we have undertaken is—and I hate to use another bit of management speak—a review; a lean review they call it. We’ve looked at the process to see whether or not we can be much more efficient and quick around some of this work. What we’re doing now is we’re reviewing that work to see what we can speed up, and working with all of the partners in that, because it’s not just the NRW bit; we’re part of a bigger group that are working on that process. So, there is work under way to look at efficiencies. We are challenging ourselves around speeding up that process, because it is absolutely important.

We also have some liaison officers that are working with woodland owners around how they can enter into the national forest for Wales as well—so, a separate function, and we’re working with those. And the final point, really, is, where we take land out of production for timber and trees, then we do have a requirement to reafforest those areas. So, that’s where we then look for compensatory planting. If, for example, renewables have come in, or peatland restoration, then we will look for other land that we can plant up so that we end up keeping the estate the size that it is. So, they’re our main areas around that.

Okay. And how are you striking a balance between planting sufficient commercial timber crops and trees for biodiversity purposes? How does this fit with the objectives of the Welsh Government’s proposed timber industrial strategy?

We use our forest resource plan. That’s the starting point, and that looks at an area of the Welsh Government woodland estate, and that will consider all different opportunities and risks in that area—so, whether it’s commercial timber production, whether it’s biodiversity, whether it’s flood risk management, all that kind of stuff in terms of how we plant trees and where we plant trees. Those are the starting points, and they’re done at a local level. So, that’s how we plan it.

I think the other thing I would say is that, actually, harvesting timber is an essential part of managing in a sustainable management of natural resources way, and you need to fell trees, you need to encourage regrowth, and all that kind of stuff, to get the biodiversity gains that we want to get. So, that is a key part of managing the Welsh Government woodland estate in the way we do. About 80 per cent of the woodland is managed as a plantation, as a crop, and about 20 per cent is then managed as a natural forest with very minimal intervention.

We’re looking at ancient woodlands. We’re trying to replant ancient woodlands. Where we’ve had conifers put onto them, we’re replanting and taking those into account. We’re also looking at various things around all the other biodiversity aims that we’re trying to achieve.

In terms of the timber industrial strategy, we’ve been a big part of supporting the Welsh Government in the development of that. We will be responding to the consultation, which I think is due on 16 April. We see it as a big opportunity, actually, because it is perceived that there's this conflict between commercial harvesting and biodiversity, but this could be a real help in terms of providing the clarity of what the aims of the Welsh Government woodland estate actually are in terms of the commercial production, and all the other associated benefits that come with commercial production, because there are lots of other benefits, around the economy, jobs, skills, and all that kind of stuff. So, it is a balance, but, at the moment, we definitely are managing the estate with the SMNR principles at the forefront of it. It’s not about commercial gain.

And is there any part of your work—? In one of the storms, we lost 100 trees. In these storms, we're losing significant numbers of trees. How is that aspect? It’s all well and good planting new trees for your targets and things, but does anybody—? I think, over the year—I’ve worked it out—there have been about 1,000 trees lost. How do you look at that?

So, whilst the impacts, particularly of Darragh, were devastating for us in terms of windblow, there is also the opportunity then, because what we can then do is look to accelerate some of the other opportunities around biodiversity, peatland restoration or plantations on ancient woodland sites. So, we are looking at that. We lost, we would estimate, probably half a year's worth of timber supply in that last storm. That's a significant quantity of timber, but it's then looking for the positives. That's not lost timber; we can feed that into the market chain over the next couple of years. But then, what we can do is accelerate the work that we would want to do then on biodiversity and peatland, because we've lost those trees is an unplanned way.

Thank you.

There is an issue there, of course, about the way you manage your budget around forestry, which has always been an issue, or a challenge. Where are you in terms of discussions with the Government and how you mitigate some of those challenges, moving forward?

We've got—I don't know what to call it, really—an arrangement in place with the Welsh Government. They are currently underwriting our timber income. Obviously, before, we didn't have that, so we were very susceptible to any changes in the market, with things like the storms affecting production, et cetera, et cetera. But we have reached an agreement with the Welsh Government now where they will underwrite—at the moment, it's £33 million a year. So, for this financial year and for the next financial year, they've underwritten that amount. So, whatever happens, we will get £33 million of income. They'll make it up if it hasn't got to that because of things like storms, which have delayed production, actually, and, obviously, if we go over that, then we keep the extra as well.

We are looking at working with them, going forward, and I think this will be part of the case for investment around how we manage that income, going forward, and what sort of level we need to create what we call a virtuous cycle of forestry. So, it actually creates an amount of sustainable cropping, I suppose, that will give us that income that we can then plough back in at that level. That's what we're aiming for with those discussions, but I think that will be part of the case for investment. But it was a huge step forward just to get the commercial income underwritten, which is a huge benefit.

Okay. Thank you. Right, in the two minutes that we have left, I have one more question. It's just asking you, really, to give us an update on the work that you're doing assessing the case for a national park for north-east Wales, where we're at and how it's looking.

Okey-dokey. Brilliant. We had a public consultation through October to December. We are now assessing the consultation responses—almost 2,000 responses to that. At the moment, from a very high-level assessment, the majority were in favour: 52 per cent versus 43 per cent against. But, of that 52 per cent, 10 per cent of those were suggesting changes to the boundaries. So, we need to do some more, deeper analysis on the boundary questions that were raised through that consultation. 

We have held a number of bespoke meetings with key stakeholders who've got particular interests, like renewable energy and farming, and also the local authorities. So, we're doing the detailed work now to understand the detail of the responses to the consultation, and that report, which will identify those issues, will be produced in April. There are also some significant pieces of evidence work ongoing, one with the Welsh Government around future funding, because that's been a major theme throughout this: how would a new national park be funded? But also we're doing a review, led by Arup, around the planning services, because that's been another key theme throughout: how does a new potential national park sit with planning activities in local authorities? So, those detailed pieces of work are happening.

We're also doing health impact assessments, economic impact assessments and equality impact assessments, which are necessary when you do such a big potential change. They are under way at the moment. All of those are aiming to be at our board in the summer, where we will make a recommendation about a desirability to designate. If the board agree that there is a desire to designate, then there will be a further consultation around the boundary and some of those issues that we've identified in the consultation. And then, following that, a designation order, if that were the outcome, would go to the Welsh Government. They would then decide whether to agree it wholly, change it in some way, or disagree it. The aim for that is all before the next term of government.

There we are. Okay. Thank you for that. That's very comprehensive. Diolch yn fawr.

Just before we finish, I think you wanted to declare an interest.

Yes. Sorry, I should have declared that I am a member of the Wildlife Trust.

Given that you asked a question earlier.

I asked the question about them.

Yes, okay. No worries.

And so am I.

Oh, we're smoking them all out now. [Laughter.] There we are. Okay. Well, thank you, just for full transparency and full disclosure.

We're very grateful for the evidence that you've given us this morning. We’ve had a thorough session and a very valuable one, I’m sure, for us as Members. Diolch yn fawr iawn. We will consider that and report accordingly with recommendations, no doubt, as we always do. But on that as well, on behalf of the committee, we would like to convey our thanks to you and all of your colleagues for the work that you do. We appreciate the stresses and the strains very often that are upon many of you as you fulfil your responsibilities, and for that we’re very, very grateful. Diolch yn fawr iawn. Diolch.

Thank you very much. Thank you.

The committee will now break for 10 minutes. We'll reconvene in—well, it won't be 10 minutes—about eight minutes, because we need to be back in the room for a prompt start at 11:00. Diolch yn fawr iawn. Thank you.

If we could just go straight into questions, maybe I could kick off, if I may. One thing that we heard in evidence previously is the relationship between NRW and the Flood Forecasting Centre. Maybe you could outline a little bit how your responsibility is distributed between the two organisations, but also the fact, of course, that you’re not formally incorporated into the FFC, unlike the Environment Agency in England, and whether that addition, or that separation maybe, introduces barriers or some sort of complexity, maybe, compared to the arrangements that they have there.

Thank you very much. Bore da. So, yes, we work really closely with the Met Office and the Flood Forecasting Centre, as you will have heard from their evidence sessions. And it’s a long-established working relationship that we have. I think the best way to describe it is that the Met Office are really there to provide that weather information, that rainfall information for the whole of the UK. The Flood Forecasting Centre was something that came about after the 2007 storms in particular, recognising that there was a need for looking at forecast information on a national basis, on an England-and-Wales basis. It’s true to say that the Flood Forecasting Centre is a collaboration between the Environment Agency and the Met Office, and it predates the formation of NRW. So, Environment Agency Wales was always part of that relationship. It’s a little bit of a different relationship now, now that we are NRW, but it is a very close relationship nonetheless. And I think you will have heard from the Met Office and flood forecasting colleagues about how it’s well established, and how the roles and responsibilities of the different organisations are fairly clear.

I think, as I said, the Met Office is the rainfall end of it. As to the Flood Forecasting Centre, I think the best way to describe it is that they look at the risk on a county-by-county level across the whole of England and Wales. And then we take that information, working with the Flood Forecasting Centre, and look at what it means in terms of floods and flood warnings, and flood warnings at a community level, so at a very local level.

Yes, so you don’t believe—it’s hardly breaking news, I’d imagine—that not having that same, seamless relationship between you and the Flood Forecasting Centre, compared to the Environment Agency, is in any way a disadvantage.  

At an operational level, it’s the same in England and Wales, in terms of that operational relationship between the Environment Agency and the Flood Forecasting Centre, and NRW and the Flood Forecasting Centre. Where it does make a difference is that it is funded predominantly from the Environment Agency and from the Met Office. And so, in terms of research, development, innovation, priorities for the future, I think it’s true to say that there is a bit more sway from the Environment Agency from England, because they are a full partner in it, whereas we’re—

Money talks. [Laughter.]

To an extent, yes. 

I think all I’d add is that it’s a scale issue. It’s money. It’s a scale issue.

Yes, okay. Diolch yn fawr. So, your written evidence says that not all of your flood warning areas are covered by forecast models, due to, and I quote,

'technical viability, resources, costs and priorities.'

Can you clarify how many warning areas are and aren't supported by models?

So, in terms of the whole of Wales, as you know, there are a lot of properties at risk across the whole of Wales—one in seven properties are at risk of flooding across the whole of Wales. We offer a flood warning system, but it's important to note that that's not for all locations, and not for all communities, because there are some isolated communities, there are some areas where it's technically quite difficult to provide that flood warning service, and that's just the reality. So, it's not—

'Technically difficult' would mean what?

Isolated areas, areas where we don't have the gauging information—

I see. Not in terms of sending the message; in terms of you assessing the situation on the ground. I see.

Yes, in terms of the risk. And we have to approach it on a risk basis, as we do with all our work, as we're directed to do by the Welsh Government. So, all the highest risk locations are covered by a flood warning service, and most of those high-risk locations are covered by a forecasting service. So, there are properties at risk, there are areas where a warning is possible, and there are areas that are serviced by a forecasting service. All of the coast is covered by a forecasting service, and a lot of the inland catchments are also covered by a warning service, but not all of the catchments, because, again, it's something that's been built up with history, it requires investment. But we do prioritise it on a risk basis. And we're not standing still; we're investing in new areas that we're going to bring online, for example, in terms of forecast areas.

I think the other point, probably, to really note is that it's forecasting and a warning service for rivers and the sea. I think, again, the Met Office and flood forecasting colleagues were talking about the fact that it isn't a forecasting service for surface water flooding, because, again, that's very technically difficult to do and quite a challenging area. So, we issue warnings for flooding from rivers and the sea.

Sure, and we'll come on to some of those aspects in a minute. So, you do have plans, then, to extend the spatial coverage of these.

Yes. We've got some locations that we're going to bring on in terms of forecasting abilities in the near future—the upper Wye area and, I think, the Cadoxton as well, in terms of the area around Barry. We've got plans for the Dee and other areas of the Wye. But there are gaps. There are gaps as well. For example, there are gaps in the Ebbw, Sirhowy catchments in south Wales, the Llanelli area, some areas in north Wales. Again, that's a function of prioritisation, that's a function of investment, that's a function of capabilities and capacity to cope.

But, ultimately, over time, maybe, the aim would be to reach that full coverage.

Ideally, we would like to be in a position where it's 100 per cent coverage. It's about 84 per cent coverage now, at the moment, in terms of rivers [correction: of the areas where we have a flood warning service, 84 per cent of those areas have a forecasting service. This is areas at risk from rivers and the sea]. We would love to get to 100 per cent, but it will require investment. And, again, I think there's a series of choices in terms of where the money is best spent. There's discussion sometimes about radar coverage, there's discussion about probabilistic forecasting. There's a series of choices in terms of where that investment is best placed, but it will require investment.

Excellent. Okay. Thank you very much for that. Julie.

Diolch. Bore da. I wanted to talk about storm Bert in particular. You issued 65 flood alerts prior to storm Bert, which I think was the lowest of your three tiers of warnings. Given that the Met Office forecast that 150mm of rainfall was possible in the south Wales Valleys five days before the storm hit, why were higher tiers of warning not issued earlier?

We work closely with the Met Office and the Flood Forecasting Centre, as I was explaining, and one of the key products there is something called the flood guidance statement, and that's used with responders, emergency services and local authorities, and it looks at the risk five days out. So, five days out from the main event on that Sunday morning in November, we were doing the usual thing in terms of talking to the Met Office and talking to the Flood Forecasting Centre about the risks. And it is true to say the Met Office were saying that the worst-case scenario was that 150mm of rainfall was possible on those catchments. That's why we said that there's a chance of significant impact here. So, in terms of our information that was going to responder communities, we said, 'There is a chance of significant impacts. It's a low probability of significant impacts—like every risk matrix, it's probability and impact, but it is significant impacts.' And they are significant impacts because, if 150mm of rain does fall, then it can generate significant impacts. The key thing in it, though, is the level of confidence in that, and also exactly where that rainfall will hit. 

I was describing how the Flood Forecasting Centre work on a county level, and pretty much the Met Office work on a larger spatial area. And so, they were saying that there is a possibility within counties that there could be that amount of rainfall, but it's really crucial in terms of exactly where that is; 150 mm in one catchment is very different from 150 mm in another catchment. And the nature of our catchments is that 20 miles in one direction or the other makes a big difference.

So, significant impacts were signalled, but because the probability of that wasn't certain, it came out as an amber warning [correction: yellow warning] and that was replicated in both the weather warnings that were issued and the information we were giving to partners. Then, as you get closer to the events, that's when those county-level forecasts can start to be translated into the more local forecasts and predictions. So you're right: we issued 65 flood alerts pretty much on the Saturday of that weekend, which was in advance of the worst impacts. And flood alerts are, 'flooding is possible', so, people need to be aware and ready for it. And then when the events happened, were coming up to happening, we were issuing flood warnings, and 68 flood warnings were issued.

One of the challenges, particularly in the south Wales catchments, is the very steep sides and the rapid-response nature of these catchments. So, if you do get sudden downpours of rain, and depending on which catchment it is, you can get this very rapid rise of rivers. And that's what happened, for example, on that Sunday morning on the Taff in Pontypridd—an extremely rapid rise of rivers.

It's also really important—just one really quick final thing on it—in terms of, it is a bit of a balancing act in terms of when warnings are issued in terms of, we can't overdo it, because if we overdo it, then there's a danger that we lose the public in the messaging. If we overdo it—by overdoing it, I mean forecast it, issue warnings, and then it doesn't happen—people start to lose faith in our systems, people start to lose faith on that.

Yes, I understand that about a balancing act, but we were told by the leader of Rhondda Cynon Taf that an NRW flood warning for Pontypridd during storm Bert wasn't issued until water was already over a foot deep in the street. 

Gareth, do you want to come in?

If I could just come in, Jeremy. Jeremy gives an excellent overview in his area of the business. I think just one correction is that, it was signalling a yellow weather warning right up until the Sunday, and it was on the Sunday it turned to amber. I think we might have suggested it was amber earlier on, but it was on that morning. And you're right about Councillor Morgan, and obviously we've spoken to Councillor Morgan several times since.

Tim will be able to give you more detail locally, but obviously we have a record of when we issue warnings. We issued the warning on the morning. We'd been talking to partners in the lead-up. Obviously, we keep incident logs, and we were speaking to the local authority all the way from Thursday through to the morning before the event. We had about three telephone conversations online with them. We were on first thing in the morning of the flooding, about 7 o'clock in the morning. It's not an exact science, but it's quite precise. We know that we issued the warning at 07:41, and our records would indicate the onset of flooding to properties was nearer 8 o'clock, 07:57. There may have been water on the street—I don't know the depths, but we would judge it on when water enters the property.

Now, we always want to give as much warning as we can, notwithstanding the points Jeremy makes around, if we're overzealous, then people won't listen to the warnings. But it is fair to say that these weren't storm Dennis level in terms of the river at Pontypridd—it was about a metre lower. But I think I'm correct in saying, Tim, this was the fastest rising water level in that area, and that restricted our time on the warning. And since, in the lessons we've learned as a result of that exercise, we've actually lowered the trigger level because we haven't seen the water rise at that pace previously.

Thank you. Tim, did you want to—?

Gareth has stolen my thunder, actually. [Laughter.] I would agree with what Gareth said. Thankfully, the river levels didn't get to storm Dennis levels, but what we did experience, as Gareth has said, were very fast-rising water levels that we haven't experienced before and we haven't recorded before. So that's why there was a very short gap between issuing the flood warning and the onset of flooding on the highway at Sion Street.

We have reviewed the trigger levels and we do that after every major event, and accordingly we've reduced the trigger level for Pontypridd to give us extra time to get that warning out. So, if you experience the same rates of rise in the river level, we've got more time to issue that warning before we see the local impacts.

Certainly, when Councillor Morgan gave evidence, I think he was quite clear that he felt the warning was too late—well, was late in terms of reaching him because of the water being, I think he said a foot on the highway. 

To recap what Jeremy said, a flood alert was out on Saturday. Flood alerts do mean that flooding is possible, and it would cover highways. Our flood warning is predominantly focused at property-level flooding. 

Right. In any case, you have got earlier trigger points now as a result of this. 

We have lowered the trigger level to give us more time, yes. 

So, could you tell us: is this just for Pontypridd that you're doing this at an earlier point, or is it something that you've agreed for all incidents like this? 

We review the trigger levels after every major event, and we've reviewed the trigger levels since storm Bert. But the only one we've adjusted is Pontypridd, and that's because of the anomaly in the rate of rise of the river that we haven't experienced there before. 

Right, and so you haven't experienced that anywhere else. 

No. 

Right. Thank you. 

Diolch. Briefly, Delyth. 

Briefly. In my ignorance, why do you think that is the case? What are the idiosyncracies of the situation in Pontypridd that make it unique in that way, would you think? 

You've got a challenge in Pontypridd in that you've got three fairly significant rivers all converging in Pontypridd, or just around Pontypridd. So, you've got the Rhondda, you've got the Cynon and the Taff. Each of those contribute a different volume of water to the area. So, the Rhondda is typically 25 per cent of the whole catchment, the Cynon is similar—25 per cent—and the Taff is 50 per cent. So, depending on exactly where that rainfall falls within those three rivers, that will depend on what the reaction is you get on the river at Pontypridd. It's fairly complex because you've got the three rivers converging in one place. 

And very briefly, we are seeing—as you'll be aware, I'm stating the obvious—that the nature of the rain is different. They're saying—

It's flash flooding. 

Well, they're saying that the convective type of the rainfall—. Generally speaking, 1 per cent of warming is equivalent to 20 per cent more rain is what the Met Office would share, and we are seeing these bursts of convective rain in an area that Tim describes. 

Thank you very much. 

Okay. Diolch yn fawr iawn. Thank you. Joyce. 

I want to ask about the technical challenges of the forecast and warnings, and the FFC described the growing gap between Wales and England in terms of investment and technical capabilities of flood forecasting models. We're interested to know why that gap has opened up, and what actions, if any, that you're taking to remedy it. 

Yes, so, there's a lot of commonality in terms of England and Wales in terms of the systems that we use. So, the forecasting platform that we use is the same. The history of the models is the same, and similar. I think there are some differences. I think when colleagues were talking about a gap, they were talking about the potential, I think, of a gap increasing into the future, and divergence, potentially, between the different organisations, and that, potentially, presenting challenges for the Met Office, for example, working on a UK level and in terms of how they provide that data to different organisations. 

There's also a gap when it comes to surface-water flooding, and there was a lot of talk in the last session about probabilistic forecasting and ensembles, which is quite complicated but, in essence, it's about looking at how forecasts may evolve and what the range of possibilities are into the future. No organisations are using that probabilistic forecasting for issuing flood warnings; we're all using the same information in terms of issuing flood warnings. So, that probabilistic forecasting is very much something that's being looked at now, for the future and for the potential of it. 

I think it's true to say that in England, they have again invested some time to look at that potential. We work really closely with the Environment Agency and share information across the border both ways. We're interested in that work, but that is an example of some work that has been funded by the Met Office and the Environment Agency, and is being taken forward predominantly within England. 

There are some differences, though, in terms of the here and now and, again, it gets a bit technical, but there are some differences in terms of how some of that reasonable worst-case information is processed. In essence, in simple terms, in England, they've introduced the ability to process that using computer information. We do it a bit more manually in Wales at the moment, but we're using the same base information. There is an important point here, I think, about the information that is used for the warnings, and the information that is used for the warnings that go out to the public is essentially the same in England and Wales.

So, when people are talking about a gap, I think they're talking about the potential for a gap, going forward. We need to work hard to make sure that that's not necessarily the case. I think it's a case of, there's risk there, but we also need to respect that we're different organisations with different priorities, and we might choose to do things slightly differently. There are other issues that are common across the border, when it comes to radars and radar coverage, and we do want to work collaboratively—and we do work collaboratively—across the border, and with the Met Office, and with the Flood Forecasting Centre.

They did mention that good radar coverage was necessary to improve short-term rainfall and flood forecasting. In your view, is the radar coverage currently a limiting factor in improving the reliability of real-time flood protection?

So, radar is definitely part of the picture. So, on a UK level, there's a whole series of radar stations across the whole of the UK, which are used to look at the rainfall, and they mesh the information from all of the stations to look at the rainfall patterns. There are gaps in the UK, and there are gaps in Wales, it's true to say, in terms of the extent of that radar coverage. There are gaps in south Wales, there are gaps in north Wales as well. So, this is very much one of the things that we're talking to the Met Office and the Flood Forecasting Centre about—about whether it is a good use of investment to look at those gaps.

Now, the reason why I say it that way is because it's not necessarily the be-all and end-all. I think, in some of the descriptions I'm giving you, you can see that it's quite a complicated set of information that is utilised. What radar does is look at the rainfall that is falling now, pretty much. That's supplemented by a whole network of gauging stations in terms of what's happening now—so, all of that information is used. The crucial bit in this is, really, that near forecast—what's going to happen in the next six hours—and the quality of the information that is coming through. That's the bit that we're really interested in and are talking to the Met Office about—that near-time flood forecasting, rainfall forecasting information.

One of the things I noted from the last session was that Russ Turner from the Flood Forecasting Centre said that Wales is pretty well covered with models and that the quality of those models is good, and that's true—they're very well calibrated. But it depends on the information that is coming into them—what comes in affects what comes out. So, we're talking, in essence, with the Met Office and the Flood Forecasting Centre about three things: about radar coverage; about that short-term flood forecasting ability, rainfall forecasting ability; and also about probabilistic forecasts. And that's similar with England as well.

There's a series of choices to make there. Other things play in here in terms of, to an extent, radar is fairly old technology—there is new AI technology, there is new machine learning technology. So, it's not as simple as saying that the obvious thing to do is to invest in radar, but we might come to that conclusion equally as well. These are the very things that we're looking at.

You said that there's new AI technology—are you looking at that? Are there conversations happening between all the bodies?

Yes. That's really useful and is emerging, as you'll appreciate, in some of the thinking. I think there are other things that come into play in terms of, we've talked about the flood warning alerts, warnings, severe flood warnings, and how we rely on people being signed up to that system, and issuing things through our website. But there are things like using Google Alerts, and being more innovative in some of the technologies that we use to get the warning messages across to people. These are all part of the sorts of things that are being talked about in those forums. But, as I say, I'd boil it down to those three things—radar, near-time forecasting, and probabilistic forecasting—as being the ones of most interest to us.

We were told by FFC how NRW relies on a scenario approach to flood forecasting, using discrete 'most likely' and 'worst case' models of flood risk, and we've talked a little bit about them. But, in contrast, the FFC is trialling ensemble forecasting in England, and it captures the full range of possibilities. So, are you involved in that—are you looking at it? What would it do?

So, ensemble forecasting is probabilistic forecasting—the two terms get talked about. It's that taking present conditions, varying them a little bit, and seeing what you think is going to happen in the future. So, there's a lot of potential for use of that in terms of giving you that spread of possibilities into the future and then giving a probability to that. As I said, the Environment Agency and Met Office have started some work looking at that. We're aware of that work; we are interested in that work. We can access that work through our relationship with those different organisations. But, to be clear, the Environment Agency in England aren't using that probabilistic forecasting for their flood warnings, and it's more useful, that probabilistic forecasting, in terms of the information that goes into that five-day signal of the range of possibilities that are going to happen. There's a danger that too much emphasis is placed on it in that near time, because it can generate  a wide spread, which can cause confusion, conversely, in terms of what is the best estimate. So, we do use—. The word is 'deterministic information'; we do use point information to do forecasting, when it comes to warnings, it's true to say, and I think that was what was partly in your question. That whole probabilistic has potential, but it's not obviously the thing that is going to make a massive difference on its own.

You did mention, briefly, surface water flooding, and surface water and small watercourses, of course, we know are the largest single source of flood risk in Wales. Do you have any plans to develop forecasting capability in those areas?

Yes. I think, again, it's in that category of, 'This is an area that all of the organisations are looking at'. I think there's quite a lot of emphasis on it in England, because of the impacts of sudden thunderstorms in London, for example. When London's flooded and basements are flooded in London, it's been thunderstorms in the summer, it's been the tube that's been impacted, and that sort of infrastructure that's been impacted. So, I think some of the desire to push the boundaries on that surface water flooding comes from some of those perspectives.

We talked earlier about—. This is one of the challenging areas, sudden downpours. You can also get sudden downpours in winter. Some of these flood events that we're experiencing are fronts coming through, but sudden downpours within them. We're very much interested in that, and the capability of being able to predict where that is, because that goes to my point around that's the information that you're putting in to models to generate your warnings. So, the point I'm making is that it's not as simple as saying, 'Surface water flooding is an area to investigate'; it's that whole area of short-term big downpours, being able to predict that sort of information, and the impacts from that.

There are known things, and you do know where rain is expected to fall quite heavily, and also the pressure on building houses. I'm not sure that local authorities have always taken surface water flooding very seriously in this space; perhaps they will now. So, in terms of not creating more surface water flooding, which is what I'm trying to get to, what sort of input and help do you give to local authorities, or any planning authority, in this area, so that they fully understand the need, first of all, to mitigate it, by the way they build, and also not to allow what is commonly known as 'urban creep' after they've built?

Very briefly, then, because we're against time, and I know we want to come on to mitigation in a minute.

Just a really quick couple of points. Surface water is a significant risk in Wales, as it is throughout the whole of the UK, and I don't want to underplay that. Indeed, some of the flooding in RCT, in Pontypridd, came from a different variety of sources, and some of that probably was due to surface water flooding. The local authority are doing investigations and will be writing the section 19 report, to look at the causes of flooding. So, it's important to say, that, yes, surface water flooding is a real risk for all of us.

In terms of planning, I mean, it's the old adage, isn't it? It's not very sensible to put more development on areas that are prone to flooding. So, we're very interested in the technical advice note 15 developments and the new TAN 15, which is going to be coming in. We do work a lot with local authorities. We do work through the planning system in terms of providing advice. Our role is to provide advice. The decisions are the local authority decisions.

And we're in a completely different place than we were a decade ago, you know, in terms of advice taken in that regard.

Good.

Okay. Diolch yn fawr iawn. Okay. Carolyn.

Regarding flood mitigation, as a risk management authority for flooding, do you feel that current distribution of roles and responsibilities for it is effective, and do you feel that there's a good level of public understanding of this distribution? So, who's responsible for flood risk in the area—you know, the council, Dŵr Cymru Welsh Water, NRW? In the past, there's been a bit of buck passing. We heard earlier that you're going to be working together better. But those people on the ground who are impacted by flooding, they immediately call the council to sort it out; the council might say NRW are responsible. Landowners are responsible as well, for ditches and culverts. And people need to know who to contact on the ground, you know, if there's going to be a flooding issue. So, just a little bit about that, please.

We fully appreciate that it is quite a complicated picture, but it's complicated for a reason, because it is quite a complicated phenomenon that we're talking about: land use, water, development, you know, recovery, impacts on communities, all of those sorts of things. We've got the system that we have for good reason, but, you know, I think everybody absolutely fully accepts that it can be complicated and it can be confusing for the public. And again, that old thing about that you don't care, do you? If you're flooded, you don't care who's responsible, you don't care whose water it is. But, equally, we've got the system that we've got for good reason, you know. And I think I would summarise it as: Natural Resources Wales is the national organisation that looks at the national picture and runs the national systems in terms of the flood warning systems. We look at the coast, because the coast, you know, doesn't respect boundaries, it is bigger than any one local authority. We look at main rivers, because main rivers flow through different local authorities. Local authorities, broadly, have responsibilities for more local flooding, smaller watercourses and surface water. But, back to that point we've just made, flooding can be complicated and it can be all of these things happening at the same time and the drains not coping with the water as well. So, what's really important is that we do collaborate as organisations, very much, behind the scenes and in facing the public response as well.

So, what councils have been asking for is—. Very often, people believe it's the council in charge of all the ditches and culverts, but, under riparian law, it's the landowner's responsibility. They often don't realise, or there might be pushback. So, they've been asking—. I think they'd like Welsh Government to help, or NRW to help, with that. So, I heard somebody recently on the radio—I don't know whether it was you, Jeremy, or Tim—talking about building resilience in flood areas, making sure you've got storm guards and all this. You know, you can't just rely on the council to come with sandbags; build that resilience in. But I would have liked to have heard as well that, 'Landowners, you need to take responsibility as well for keeping your culverts and ditches clear', because councils haven't got the resources to do it. Is that something that you might do in the future, then, to help with that? I'm going to be asking questions later about this. Councils, even, the officers, would like to have a leaflet just to be able to give to landowners: 'It's your responsibility under riparian law to stop that water going onto highways and causing surface water flooding.'

So, you're absolutely quite right that landowners do have responsibilities here, and whoever put that structure in place also has responsibilities. There is information, for example, on our website about riparian ownership and roles and responsibilities and what is needed. I think what's clear from all of this is, you know, there's a whole communication piece that is really important in terms of various roles and responsibilities. And that point that you make around also communities taking responsibility. This is not the same as saying, 'You're on your own' or, 'Public bodies aren't there', but communities do need to take some responsibility themselves as well.

But whose responsibility is it to get that message to hit home, then? Because everybody's saying there's a job of work to be done, but nobody seems to be taking responsibility for it.

Well, as I said, there's a lot of information on our website and we do convey those messages, but, again, I think it requires all of us to convey those messages, because we all have a stake in that. And by 'all of us', I mean the water companies—

Sure. Yes, yes.

—the local authorities, the voluntary sector. The National Flood Forum, for example, does good work in this space as well.

We need somebody to lead on it, I'm afraid. That would be really good. That would be a nice recommendation for us to make, perhaps, going forward.

So, Welsh Government has moved NRW's flood funding into NRW's main budget expenditure line. We questioned the Deputy First Minister about oversight arrangements, and he told us that use of this funding would be monitored closely. Could you tell us about the oversight arrangements in place for this funding, including how you report to Welsh Government and ensure that your spending is in line with the Government’s priorities on this?

Yes, indeed. Thanks, Carolyn. Yes, as mentioned by previous colleagues and you mentioned there, we get our grant in aid now in one single block, and that's allocated by a single funding letter to us. That neither benefits nor means flood risk management loses out; we can still identify the budget clearly within there. But what it does provide us is the opportunity to flex or—. Ceri and Rachael talked earlier on about we can move pressure somewhere else within the grant-aided funding, depending on what we believe to be the priority at the time.

But that is a specific funding letter. It doesn't detail priorities, which is in your question, and our priorities are driven by a term of government remit letter now, which, again is far more useful for us, because it allows us to look at it over our corporate plan period, which Ceri and my colleagues talked about earlier and I think you also talked about earlier. So, we provide a corporate plan to Welsh Government, along with an annual business plan, and in there we will give indicators about our progress on spend and on our progress against priorities that we've laid out in the relevant plans. Our board has a role, as our chair mentioned earlier on. So, the board will receive regular financial reports at a more detailed level. And again, they will be able to look at a grant-in-aid level, and at specific functions within the grant in aid. And, again, they'll have a performance report.

And just finally to say, we will meet, at least, formally, quarterly with our sponsorship committee. Again, there are more granular reports on the finance and on the performance at these meetings, as well as a myriad of other meetings that go on, policy to policy as well, between ourselves and Welsh Government.

Okay. I'd just like to ask about the fragmentation of water management responsibilities. Do you believe that it hinders the development of catchment-scale approaches to flood resilience planning, going forward? So, we heard from the National Infrastructure Commission for Wales; they recommended a greater use of natural flood management in future for flood resilience planning. So, is this something you would support? And because there's a fragmentation of different water management responsibilities, do you think that hinders the development of catchment-scale approaches to management of flooding?

Yes, I think what we've been talking about, and the challenges that we have, are managing huge quantities of water in catchments. And the only way that we're really going to manage huge quantities of water in catchments is by looking at things on a catchment scale, on a catchment level. Elements of this, obviously, already happen, in terms of some of that collaboration with local authorities and other partners, in terms of some of the interventions that are made. But I think there is something here about a step change into the future, in terms of doing more, more of this. Different organisations have different responsibilities—highways agencies, Network Rail, Transport for Wales, you know, and there are other organisations that are interested in the impact on their assets.

When it comes to nature-based solutions and natural flood management, again, that is very much part of the mix, but I think something really important here is that we need all of these things. It's not like there's one thing that will solve this problem. So, the nature-based solutions and natural flood management are definitely part of the mix as well. But nature-based solutions and natural flood management aren't necessarily the same as catchment approaches to flood management. If we're going to manage the huge quantities of water that we've got coming down a river like the Taff, it is going to require significant areas of storage, probably, and making space for water. So, things like the sustainable farming scheme come into play, and incentives and grants to do this sort of thing. But this is very much, I think, the space that we've all got to work in and do more, going into the future. It will also need very conventional approaches. We'll still need defences in places, so it's a matter of doing all of these different things.

Gareth.

Two very brief points, if I could. However you organise yourself, and we find this as a business, you'll need to make the matrix work the other way. So, there are definite benefits of NRW and other organisations working in the way we do now, and we integrate our activities, as we mentioned, across the land we manage and the floods et cetera. So, whichever way you organise it, you need to make the matrix work the other way.

The other thing I'll say, and it refers to a conversation earlier on again, is that about 80 per cent of our budget is fixed on assets and flood warnings, dealing with the here and now, and we're trying to free up and pivot—I think that was the term Ceri used—our budget to look at how do we look at the big challenges in the future while managing an acceptable level of risk with the assets and the warning systems we have now. So, there is a trade-off and a conversation to be had. 

It just feels like somebody should take the lead with this a little bit. We've heard about NRW as well, with their own land, when there's been mass tree felling, and water run-off, the way it's been done. The trees have been laid straight down; it could have been done a lot better. They're not managing their own culverts as well, on NRW land, so that needs to happen better. But, like you said, water catchment, wherever possible, on the uplands, working with partners, is also something that's been raised. 

If I could just touch on the Taff strategy, it's the first one we're doing in Wales looking at that approach. It will look at the very stuff you're talking about. It's in development. It will take a while to do. We're learning as we go through that process. It will have to look at all of the mechanisms that Jeremy has touched on in how we manage that floodwater. The Taff is particularly challenging. It's quite a unique environment in that it's got urban encroachment on the floodplain from top to bottom. There are not many catchments in Wales that are like that, and that's the challenge: how do you make the space for that water; how do you manage that water?

We have that with the River Dee in Shotton, Queensferry, Sealand, all of those—Mancot. So, it's in that area as well. I've got just one more. Powys—

No, I'm sorry, we've got to move on now. Delyth, on to you.

Diolch, Cadeirydd. I wanted to ask you about public involvement, the public perception of different things. Do you think that communities have a good understanding of the difference between flood alert, warning, severe warning? And could you explain to us please why you use that system instead of saying that it's red, amber, yellow, like the Met Office and the Flood Forecasting Centre do?

Again, it's a challenging area, isn't it, in terms of getting that awareness about what these different things mean, especially if flooding is something that doesn't happen to you very often. I think there is a danger, with any three-tier system, that it's almost seen as a traffic-light system and that it's only when you get to the severe end of it that you need to take action. So, quite a lot of our messaging is: first-off, flood alerts, flooding is possible; flood warnings, flooding is expected in properties; and then severe, it's a risk to life.

It's important that we work together as organisations. There's something that I think got referred to in the last session about the common warnings framework. This is all of those organisations using the same sort of terminology, the same sort of messages, the same sorts of words, the same sort of messages that they're giving out there, commonality of language, because that simplicity is important. It's important that it's there for the flood warnings, it's also there for the weather warnings. There was also something that was referred to around the common alerting protocol, which is international. It's important that we use the same sort of terminology and the same sort of risk matrices. 

I think that there is a bit of a danger, going back to what I said at the start of this session, that there are scenarios at the moment where we're saying that flooding could be significant but it's low probability; that's yellow. Yellow means that perhaps we don't need to take action, but that's something that we need to reflect on as organisations: is that sending out the right message, or if that's the interpretation of the message, do we need to do something differently in that sort of territory? I think that quite a lot of our partners understand that now. If you're at that significant level it could happen, so you do need to step up, but there is a bit of feedback that, 'Unless it's amber, do we need to take notice?'

Especially because, so often, the yellow warnings—. You were talking earlier about almost the 'boy who cried wolf' scenario and avoiding that as well. 

Yes, exactly. And we're getting more and more of those yellows as well. 

Thank you for that. In terms of sign-ups from the public to flood alerts, you said to us in the written evidence that those sign-ups aren't as high as you'd like in some places. I know that the British Red Cross have said that sign-up rates are lower in low-income areas, which is really concerning for us as a committee. Could you talk us through, please, how many of the at-risk properties are signed up and how that proportion changes, not just across Wales but in terms of low versus high-income areas and whether that's concerning for you as well?

We've always had challenges in getting people to sign up to what is a free flood-warning service at the end of the day, and I think that there are quite a lot of reasons in terms of why that is the case. I think that, sometimes, people don't appreciate that the risk is as acute as it is. Of course, a lot of people who live by rivers are fully aware of what that risk is. I think there's also a bit of a perception that it can impact insurance, for example, and other elements around this. We've done a lot of campaigns down the years and engagement with communities to say that it is an important part of the armoury, but I think, also, so is the action as a result of signing up. What signing up will do is give you that warning, but you need to know what to do on receipt of that warning or what that warning means in terms of perhaps moving your car and all sorts of other steps that you can take to avoid the damages.

I think there’s also a link into community flood plans, and there’s a link there that, if you do get these warnings, this is perhaps what you need to do on a community level. Tim talked earlier about the fact that after every event, we learn lessons and we look to see where we can make improvements. This again is one of the areas, through the common warnings framework, where we are talking to the Met Office, the Flood Forecasting Centre, the Scottish Environmental Protection Agency—all the organisations—about, ‘Is the language right? Is it in the right space?’ But I think you do need something that distinguishes between low risk and high risk, because you can’t average it out.

No, sure, but I suppose what makes it even more complicated, as you've been referring to in this session, is the fact that, because of this flash flooding—I know that's not the technical term for it—shifting from yellow to amber could happen very, very quickly, particularly if it's overnight when people are asleep. You mentioned the local flood plans, and I know that you've said that you would like to encourage more local communities to develop those. We are interested in how you think they could be developed and how much of a role you think they play now. But considering what we've just been talking about, is there a risk that, in terms of variance as well, you'll have the more empowered communities, which are higher income, having that extra level of buy-in and empowerment, if that's the word, whereas the ones that are further left behind could get even less empowered as a result?

I think that's a really good point. Do you want to—?

As the risk is increasing, we do do quite a bit of work to encourage local communities to develop flood plans. We've got templates and that that we make available. There are plenty of resources on our website in that regard. We do work with third sector organisations. You mentioned several of them there, but the National Flood Forum, British Red Cross, Wales Council for Voluntary Action. But I think you're absolutely right in the need to continue to work to encourage communities to take ownership, and it can vary in communities. The assumption you make on one level is correct, but having knocked on doors in lots of communities, what you actually find is that the reception to the message is better in some of the what you may describe as lower social or more deprived communities.

But we do have lots of information available beyond templates. Jeremy's mentioned the flood warning system, so I won't mention it. We have invested in this area previously. It's quite a while ago now, but some of you may remember the 'Welly Boot Tour' that we took around Wales. It was a flood awareness campaign. It was aimed at communities that were at high risk of flooding, but where awareness was low. We knocked over a 100,000 doors in 100 communities across Wales. Our learning from that was that it was good at a transactional level, and it did lead to lots of community flood plans being developed, but there was a fall-off, and so it's about getting deeper into those communities.

We also started, back in about 2015—. We do run flood network events. As a matter of fact, we ran one last week in Merthyr Tydfil. Six local authorities from the surrounding areas came. All of the third sector organisations I mentioned there came. And again, this is a conversation we're having about how we enact that and support the communities. And we're in Aberystwyth next week. So, we've been doing that annually. We produce a newsletter with the information, and that's up to about 5,000 subscribers now. So, we are active in the area, but we can always do more.

Thank you so much. There's so much more that I want to ask you about, but I won't eat into more time. So, diolch yn fawr iawn. Thank you so much.

Diolch yn fawr. We'll move on to Janet.

Thanks, Chairman. Your written evidence—we're moving on to trees now—has highlighted damage to the Welsh Government woodland estate during storm Darragh, and the need to replace lost trees over the next five years. How will you ensure that future planting is more resilient, given the likely reoccurrence of similar-strength storms in future years?

Thanks, Janet. Storm Darragh was indeed a big event for us flooding-wise, but even more so on windblow on the Welsh Government woodland estate. Across Wales, it was 1,400 to 1,600 hectares, 900 hectares of which was on the Welsh Government woodland estate. My colleague Ceri referred to some stats: 400,000 cu m of timber, about 60 per cent of an annual harvest, currently sits on the floor—a one in 30-year event; many of our staff haven't experienced it. Three decades ago was the last time we had a windblow event of that scale.

Have you got the resources to get it up quickly so that it can be sold?

It's not quite as simple as that, simply because we need to plan how we approach the forest in the future. We need to look at diversifying species of planting. So, 90 per cent of the trees affected were spruce trees, so we need to look at diversifying to get more resilience. We need to do more regular thinning to help with the sustainable management of—

Have you got the resources to do that?

Well, it is a question of whether we've got the resources, but it's also a question of whether the markets can deal with it as well. So, what we're needing to work out is how we deal with that amount of timber on the floor, how we dovetail that in with our annual felling and planting programmes, because as Rachael mentioned previously, we need the natural regeneration. As operations director, I'd always wants more resources from Rachael and her team, but there's a pace we can go at that has to be sustainable for the replacement of the forestry, and has to be sustainable in terms of how much the market can take in terms of timber.

Can I just ask this point, and it was a point that was raised earlier? I think it's £33 million to actually underwrite the amount of timber. That's not putting you off quickly getting it up and—. Because you've got that guarantee, haven't you?

We've got that guarantee, but it's part of our income. We're also grant funded to run the forestry as well, so it's not as straightforward as relating that income. I think we spend about £44 million a year [correction: the actual figure of direct costs is £45.5 million, and with overheads £54.4 million]. And we've talked previously about the £12 million cut. There will be a cut in forestry, but we are protecting those felling areas for the sustainable management of the forest, and that's why we were looking at the other areas that you talked about earlier on at the committee, like visitor centres and the recreation side.

Where you've got National Grid, Scottish Power, they say a substantial portion of the damage to electricity distribution—. Because it's one thing having a flood, but you could end up with no electricity, no mobile phone signal, no broadband. So those kind of infrastructures, a lot of the damage was caused by falling trees. In those areas where infrastructure is located within your woodland estate, how do you work closely with electricity companies to minimise the risk of damage?

Just in terms of numbers, you'll know there were around 260,000 homes, which is a significant number, with a loss of power, but I'll just talk very briefly about the flooding impacts on power stations. We pretty much focus on the risk to life and people when they're normally at home, so we focus through policy on risk to life and properties. We're not aware of specific flooding in either of the events around electric substations or whatever, but we do plan for those through local resilience forum scenarios, and registers are looked at across Wales.

For forestry-related activities, which is where your question was, we have a master agreement with the electricity companies and the telecom companies, which sets out a high-level approach to managing wayleaves in the forest. In some areas, that leads to site-specific agreements and they detail the management of vegetation from the lines, et cetera. They're legal agreements between two parties, but the utility company is responsible for the management of vegetation within the wayleaves. We have an agreed policy and procedure for how we manage our felling operations around those areas. And again, colleagues talked earlier on about when we are designing forests and in our forest resource plans, we look at the outer edges and put species there that are more resistant to wind. And, of course, the width of the wayleave determines the risk, likelihood and impact.

Thanks. How do you ensure these companies have timely access to repair infrastructure when damage has occurred?

As I said, I explained about the master agreement, but we have general agreements with utility companies on accessing our land, and we have good working relationships with both. As expert users, they have keys and access to all of the woodlands; they can get to all of our sites. They have statutory powers to access the land, should they need to, but—

But that's the point—should they need to. How do you ensure there's better working together?

I was just going on to say that storm Darragh provided a really good example where they could have gone directly on, because they have the right to, but they came through NRW staff, and NRW contractors worked really hard with the power companies to gain access to the forest. If you've seen the photographs, the photographs were pretty telling, because there may be a forest there, it may be blown over, but the access roads—. It took three weeks to get to the last property in there. It was quite a significant amount of work. But from our perspective—and this is the feedback we've had—we worked really well. As I said, they could have gone in themselves, but they came through our local staff who have the local knowledge, and there's 24/7 cover through our incident centre.

Diolch yn fawr. I think that brings to an end our session. Can I thank you for the evidence that you shared with us? Clearly, it's part of a wider piece of work that we're doing, which we'll report on. As I mentioned to your colleagues earlier, it'll be another report that'll bring recommendations forward, and hopefully, maybe, some of those, you may wish to respond to in time. So, diolch yn fawr iawn. Thank you very much.

One of the papers—I'll just find it in the pack. It's consideration of the draft report on the legislative consent memorandum for the Data (Use and Access) Bill.

That's not a paper to note, that's another item on the agenda.

Okay. That's fine then.

We're coming to that in private session.

Thank you. 

Okay. Diolch yn fawr.