Cynulliad Cenedlaethol Cymru

Good morning and welcome to this morning's meeting of the Public Accounts and Public Administration Committee in the Senedd, the Welsh Parliament. No apologies have been received for this meeting. We have Members participating online, with Rhianon Passmore on the screen before me. Do Members have any declarations of registrable interest? Thank you very much indeed.

The first and main item on our agenda today is consideration of the Future Generations Commissioner for Wales's annual report and accounts for 2022-23. Could I start by, again, welcoming the participants and asking each of you to state your names and roles for the record?

Thank you. Good morning and thank you for inviting us here today. I'm Derek Walker. I'm the Future Generations Commissioner for Wales.

I'm Marie Brousseau-Navarro. I am the chief operating officer and deputy commissioner. 

Thank you, indeed. Well, as you'll expect, we have a number of questions to ask you. I ask Members and you, as witnesses, to be as succinct as possible to enable us to cover as wide a range of those issues as we possibly can. And, as convention has it, I'll begin with the first questions before bringing colleagues in with subsequent matters. So, a question to the commissioner himself: now that you've been in the post for over seven months, what are your reflections on how the office is organised and run?

Thank you, Chair. So, yes, it's coming up to nearly eight months, actually, at the end of the month, and it's been a busy first few months. I have been clear that, in this role, it's a new phase for the Act and for the commissioner's office with a new commissioner in place. So, I've been busy putting a plan in place, which I will launch in the middle of November, and I'll perhaps come onto some of the detail of that throughout the course of the conversations today.

I guess, I come into the organisation with some experience, with 12 years of running a third sector organisation and running the governance and finances of an organisation. And my first impressions have been very positive about the way the organisation is run, the systems and processes that are in place and the policies that are in place. I've been able to get that assurance from others as well. We have a programme of internal audit reviews, which has given me strong assurance about some of our processes, and that's an ongoing programme of internal audit that we have. As you'll have seen, we've just had a clean audit report—actually, a complimentary audit report from the Auditor General for Wales's office—about our accounts for last year. I also have a very strong audit and risk assurance committee in place. The membership is actually changing, because some of them are coming to the end of their term, but they provide robust challenge and advice to the work of the organisation.

So, I think the organisation is in a good place and I'm confident about the way it is run, but, nonetheless, I think, coming into an organisation, there's an opportunity to bring some fresh eyes to the way an organisation is run and bring some of my experience from my previous job to understand how we can continually improve how we do things within the organisation. That's what I've been doing over the last seven and a half months or so. So, for example, we have done some strengthening of some of our policies and systems—our procurement processes, for example. I've reviewed the policy and that's been strengthened in the last few months. We've done a lot of work, led by Marie, on our cyber security, and so we have IASME level 2 cyber security level, which we didn't have previously, which gives us assurance in that regard.

In other areas, we put a new set of values in place, just agreed for the organisation, so we have a coherent set of values about how we're going to operate. One of the values is about being open and trying to be more transparent about how we are as an organisation when we do things and how we do things. So, we will be publishing the minutes of the assurance part of our risk and audit committee, so people can see what's being discussed and the discussions that are being had. And we publish, for example, the gifts register. I think we're only obliged to do it for Marie and me, but we do it for the whole organisation. So, that's part of the approach I'd like to take to be more open and transparent. In summary, I think the organisation I inherited is in good shape, but there's always room for improvement, and we're looking to continue to do that over the years ahead.

As you indicated, you came from a third sector body, Cwmpas. As somebody with that third sector background, what differences have you noted with this—? I don't know where you would sit this sector—it's quasi-governmental, but independent of Government.

One of the biggest differences is there isn't a board. You're a corporation sole, and so I'm effectively the board of the organisation. So, that's a big difference. But I think there is adequate accountability and scrutiny in other ways. So, as I've mentioned, there's ARAC, a risk and audit committee, there's also the advisory committee for the organisation, and also the scrutiny that the Senedd and the Welsh Parliament provides through this committee and the Equality and Social Justice Committee, and I report regularly, obviously, to Welsh Government about what we've been doing. So, I think there are a range of ways in which I can be accountable and the work is scrutinised, but it is slightly different from a not-for-profit organisation where you have a board in place. I think that's the biggest difference.

Okay. You were only in the post for the last month of the period to which the report relates. What specific assurances did you therefore seek before you approved the report?

I sought assurances with regard to the work that was delivered in terms of looking at what had been produced. So, for example, one of the big pieces of work in the last year was a section 20 review that the previous commissioner undertook into the work of Welsh Government. I was able to get assurance that the work had been produced and to good quality. We had a number of key performance indicators, measures of success, in place previously, which will now be changing, that enabled me to get a sense of where we've delivered against those KPIs. With regard to other aspects, of course, there are external ways in which I get assurance. So, as well as the ARAC, the auditor general is able to give assurance around the finances, but I also look through the financial information myself. So, it's a bit of triangulation that I sought through my own direct information and speaking to colleagues within the organisation, but also through third parties such as the report of the auditor general and external reports that we produced, and clients that we've worked with.

Okay, thank you. The report's structure, style and narrative largely follow the same pattern as that of previous reports. To what extent were you able to influence this report, for 2022-23, and what plans, if any, do you have to change the presentation approach in future reports?

Yes, the structure follows, as you say, what we've done previously, and because I was very new to the role, we followed the previous format for producing the annual report. There is guidance on what we need to produce and how we produce it, so, obviously, that needs to be followed. It was my role to sign off on the report and agree the structure of the report, but, because I was new in post, I thought it made sense to follow largely the structure that we'd had previously. This will change, though, and my plan is that this will change in future years, mainly because I'll be putting a new programme of work in place, which I mentioned earlier. We'll be publishing that new work plan in the middle of November, and that will have a different focus from what's gone before. So, we will have a number of missions that we will be focusing the work around. Previously, there were a number of priority areas and four purposes, so that will require a different structure. But I think a key part of the information that will change is that we will have a whole new set of KPIs—performance indicators—about our success. I inherited a number of KPIs from the previous commissioner, but, with the new programme of work, it requires new measures, and we've been working with a consultant this year to give us some external support and challenge about how we measure our success as an organisation, and we will publish those in the middle of November and they will be a big part of how we structure the report. So, this is what we said we would do, and this is what we've done, or what we haven't done, and being honest about where we haven't met our own expectations.

I'll be interested in the committee's response. I think it may be that we will produce shorter reports as well. Some of the reports, I think, that we've produced as the commissioner have been very long, and I think, sometimes, that doesn't help with communicating the messages that we want to communicate. So, we will look to see, whilst providing the necessary information, how we can make the document as accessible as possible and as concise as possible.

And finally, before I pass on to colleagues, will those key performance indicators and measures include the five ways of working under the Act?

Well, absolutely, we'll be adopting the five ways of working. In terms of putting together the plan, what I've been very keen to show is how we demonstrate the five ways of working as part of putting together the plan. I've listed on my screen the types of KPIs that we're going to focus on. I don't want so many KPIs that all we're doing is measuring; we need to be delivering. But these will be things in the categories of what we've done, the impact of our training, what we do in terms of sharing good practice, who we've reached, the difference that's been made by our monitoring and assessing, the difference that's been made by our advice, the difference that's been made by our convening, and the difference that's been made by our advocating. Underneath each one of those there are different KPIs that give us an indication of where we've made an impact.

Sorry to go on about this, but I think this really is important: these KPIs will be things that we can make a difference on directly. I'm very keen to make sure that we can see the difference that our activities are making. So, even though we are, perhaps, part of a bigger discussion around how we look at health and long-term health outcomes, and reducing the demands on our health service, many others will be playing a role in that. So, whilst we're working to a bigger outcome for the country in terms of reducing long-term disease and issues of health within our organisation, getting into the prevention agenda, we'll be looking at what we can directly influence as part of that bigger agenda, and that's where the KPIs will sit.

Okay, thank you. Natasha Asghar.

Thank you so much, Chair. Good morning, both. So, I was going to actually begin by asking you about how you measure success, but you seem to have answered that question beautifully. So, I will then go on to ask: obviously, you've mentioned KPIs, you've mentioned that you're going to be publishing minutes, you've mentioned the auditor general's report, but what specific and quantifiable measures are you actually going to be using to measure your performance within the office and also the user experience, which is equally important, as well?

Yes, absolutely. These KPIs will be measurable. I know that the way I explained them there was very sort of 'headliney', but, for example, who we have reached, they will be measurable by the range and the number of organisations—so, have we reached new organisations and what is the quantity of those organisations that we've reached.

Do you have a numeric target for that?

We haven't set those numeric targets yet, but that is the intention, to do that.

Is there a reason why you haven't set one?

Well, just because it's taking the time to be able to do that. Where we've got is the types of—you know, the broad headings that we'll be using. In some ways, because some of this information hasn't been collected previously, in some areas, we don't have a baseline on which to assess where we're starting from. So, we'll be making a judgment call. 

The other reason, of course, is that we don't know what our budget will be for next year, so, that will affect what we can deliver. So, as we go through the next few weeks and months when we've got a better idea of the budget that we'll be having as an organisation, that will enable me to set more accurate KPIs. But they will be measurable and I think that's important for us as much as it is for you and others so that we know that what we're doing is having an impact or not.

Absolutely. We just want to make sure that everyone gets value for money at the end of the day.

Absolutely.

Okay. So, how do the sections that, together, comprise the performance report, tell us about what your office has achieved during the year and do you think it’s actually a balanced assessment?

Yes. I'll bring Marie in because Marie was around for more of the year than I was, obviously, but I think it does give a good overview of what was achieved during the course of the year according to the KPIs or the measures of impact that were set for last year. You'll see also though that, within this report, what we've done is talked about the overall impact of the last commissioner's term, because it was the last report for Sophie Howe, so that gives an overview too of the seven years. But perhaps I could bring Marie in to talk a little more specifically.

Yes. So, in this report, we try to do several things, which were, first, to introduce a new commissioner, then to report on the annual activity, and, as Derek just explained, also give an overview of the legacy and the impact of the Act so far. So, that's what we've tried to do. I think we've done it successfully. And it shows you that last year has been a very busy year, being the last one of the first commissioner and a transition to a new commissioner. 

We also had an uplift in our budget that year, which enabled us to continue that pilot with public bodies, working directly with them. So, three posts were funded with that. Then the spending activity was really focused that year—on top of our usual advice, monitoring and assessing—around the demonstration of the impact of the Act to date, so, lots of research involvement, comms activities and the section 20 report. Following on from reports from this committee, we all acknowledge that Welsh Government has a fundamental role to play in the implementation of the Act. It can be an amazing driver, but it can also be a barrier if not leading by example and really showing the way. So, we really wanted to make sure that, before Sophie completed her term, we had something in place to enable Welsh Government to really deepen and continue on their journey to implementation. 

So, the report also highlights, following our performance measures that we've highlighted, lots of big issues facing future generations. We worked on many different national policies around inequalities, climate change, the national budget. We called for immediate action with the cost-of-living action plan. We've given evidence to five Senedd committees; we've increased a lot our involvement and our reach to all sorts of organisations. We, of course, completed our statutory duties and provided the statutory advice to public services boards. We've had amazing feedback as well on this pilot of having a public bodies team. Then, we strengthened the movement for change around sharing the findings and good practice around the Act. We promoted the sustainable development principle—around 100 pieces of media coverage in Wales, the UK and abroad. We delivered a very successful second cohort of the leadership academy, which is one of our flagship programmes. And finally, to finish this overview of our activity, we really also focused on walking the walk ourselves. So, we pledged to Zero Racism Wales and we published our own anti-racist action plan. We increased the representation and diversity of our own workforce using positive action. We reduced our carbon footprint by moving to a smaller office, and we are really working on this and trying to redefine how we measure our own carbon footprint and continue to reduce it over the years. 

Fantastic. You've practically listed everything I was going to ask you. But I do have a few other questions. This committee has met with a number of people for quite some time now, particularly—it's two years since we were elected in 2021—but one of the questions and one of the issues that a lot of groups and organisations have raised is that they've found it very difficult to navigate amongst the commissioners, amongst the issues that they can go with from specific commissioner to commissioner. How easy—? Whilst I appreciate everything that you've done, and that was a very hefty list you went through with me and the rest of the committee, how easy are you now going to be making it? Because out of everything you've said, making signposting easier hasn't been mentioned. So what physically are you going to be doing? What steps are you proactively going to take to ensure that people who utilise your services, offices, your knowledge, for example—how is it going to be made easier for them to be able to get to you, get to where they need to go to get the support that they need?

Yes, it's a really good point. I think the biggest confusion, actually, that I've noticed in the last few months is from the media. So, often, when it's to do with children, they will come to the future generations commissioner, rather than to the children's commissioner, and we make sure we signpost them to the right place. 

I think one of the things that will really help with this is, through the new plan, we intend to be very clear about where we're going to focus, because I guess one of the issues with—. One of the benefits and the beauties of the Well-being of Future Generations (Wales) Act 2015, but also one of the challenges, is that everything is in scope, because we're looking at long-term thinking and we're looking at the interests of future generations. So, people will naturally think, 'Well, I can see a hook for my agenda there.' So, I think one of the things that will help will be much more clarity around the areas that we're going to be focusing on and our priorities, and we'll make that very clear. 

Where? The question is: where are you going to do it? On the website, when they contact you? Where? 

The plan is—. Yes, it's through all media forms that we plan to do so, but we also plan to redesign our website, because I don't think our website is quite where it needs to be. So, the plan is that we'll do the scoping this year, and next year we'll have a new website that will make, hopefully, a lot of this a lot clearer. But we'll do that through social media, through our attendance at events and through my media work and the events that I attend as well. You can't do enough communication, I guess, around what this work is about. I think it's one of the big jobs more generally about this work. When you talk to people about the agenda, the need for long-term thinking, the need to avoid sticking-plaster approaches, the need to focus on those big issues that matter to our children and our grandchildren, people get it, but it's not immediately apparent when they see the job title, for example. So, we've just got to work really hard at communicating that, I think.

Can I add a few things as well?

Yes, of course.

Thank you. So, the place where we do most of this signposting is actually in correspondence, when people write to us about a particular issue. So, we try to be very helpful, and often we pick up the phone to other commissioners, because we don't want to leave people hanging without a solution. So, a lot of our work also involves flagging or directing them, for example, to planning advice, because a lot of issues raised with us are around that. 

We have FAQs on our website, where we try to explain the difference between the different commissioner roles. There are also different models for commissioners in Wales, which is confusing to people. Some are regulators and can give fines, like the Welsh Language Commissioner. Others are champions, so they can help them with their cases, and we cannot—we are a promoter. We try to explain that very well on our website. We also work with the other commissioners, often, on issues. As I said, we pick up the phone. Derek has regular meetings with them, and we, between ourselves, try to work a lot of these things.

And finally, your question about how do we ensure people get what they need and want—that's something we've done a lot, as part of the reflection at the end of the first commissioner's term. So, as part of our future-focused work—you know, the design of the new strategy—we have asked directly public bodies and the public, and it was part of our survey, 'What type of information would you like from us? How would you like it presented?' et cetera. We also did internal reviews within the organisation. So, we will use a lot of that to actually decide on the format of things going forward. We are also planning—. It's not really a rebranding, but it's like an update of the branding as well, and, as Derek said, we know we need much more concise information, much more visual. But, to me, the key taking from everything we ask people is that they don't want more documents, and because the issues we are dealing with with sustainable development are so complicated and complex, they need training to go with it. They need webinars, explanations, seminars, online, and that's what we are trying to work out: how do we meet this demand with our very limited budget?

Okay. All right. My final question is: why does the annual report not include a sustainability report to provide information about environmental matters, including the impact your organisation and its operations has had on the environment? And have you prepared a separate document, and do you intend to, if not?

So, we have—. We are under a legal duty to produce a biodiversity report under the Environment (Wales) Act 2016, so that's where we have reported on all these things. That's available on our website.

Okay, that's fine. Thank you so much. 

Thank you. Just on that section, before I bring in Rhianon Passmore, if you could just further clarify how you keep track of the recommendations made in the reports published by your office and assess progress in their implementation. And perhaps to throw in one very current example, we've just had a rather damp weekend with massive flooding in certain places, and, certainly in my experience, for everyone that's contacted me, whether that was a third sector body or a housing provider or a home owner or a tenant, it's about flooding in a property that was being flooded in 2021 and previously, where actions were then spoken of to mitigate against recurrence, and yet not even sandbags were provided to those in the most vulnerable conditions because of health or age or other protected characteristics. To what extent, therefore, in monitoring, do you have the teeth to require a body to account for a failure to plan for future generations in this context, to plan for further similar events, to mitigate against the risk of causing equivalent damage?

Would you like me to answer?

Yes, and I'll come in then.

As I mentioned, we don't have any enforcement powers, so the biggest teeth we have is to conduct reviews and to publish recommendations following that. Sadly, it's only for the future, so it will be advice for the future. We have only ever conducted two reviews so far: one on procurement and one on the implementation of the Act by civil servants. We track every recommendation we make and we have massive Excel spreadsheets in the office. We produce hundreds of recommendations in the future generations reports, so we have team members tracking progress on all of that, and we report against these things in our annual reports, and internally we really spend time looking at this to learn lessons and to see how we present recommendations for the future.

Can I just add to that? It's slightly different to the question that you've asked, but one of my reflections on coming into the office is the need for us to pay more attention to the delivery of the well-being objectives set by the public bodies. So, as part of the implementation of the Well-being of Future Generations (Wales) Act 2015, public bodies and PSBs set their own well-being objectives, and they are many and varied. I think we gather that information and we provide support in terms of the development of those objectives. But I think what I would like us to do going forward is to see how we can have improved systems to monitor the progress that the public bodies have made in the objectives that they've set. Now, that is quite difficult because they're so varied and we're quite a small team, but for some of them, they have very similar objectives in areas around climate change, for example. And so this is one of the things that I want to be looking at—how we can better monitor the delivery of the objectives that public bodies are setting themselves. 

Okay, thank you. Rhianon Passmore, please.

Thank you very much, Chair, and lovely to have you both with us today. Just as a quick aside, you did mention that you've got an index, a smorgasbord of ombudsmen and commissioners that are there to support and enable the Welsh public. Is that your interface or is that a sort of collective one that's shared with everybody else?

Just so I understand the question, are you talking about the arrangements that we have to liaise with the other commissioners?

No, no, just simply, you said that you've got an index at the front, in terms of explaining what everybody else's role is, in order to guide the public, really—

Oh, I see. Okay, sorry—

—a forest of very informative assistance and support. But I'm just wondering if that's something that you have done, or whether there's a collective, thematic approach to this across Welsh Government or the civil service. A simple 'yes' or 'no'. 

Yes, so that's something we've done. That's something that is published on our website in the frequently asked questions, and it's something I prepared by checking with the other commissioners if they agreed with the representation, collectively, of all our roles and functions. 

That's fine. I'm just thinking that's something that could be done as a theme across the board, and, obviously, you've led the way on that.

So, during 2022-23, and, obviously, in terms of your reign, in terms of coming into post, and with the Minister for Social Justice's agreement, the office used reserves and cash to supplement the funding from Welsh Government and other income. So, basically, how has that been used in terms of use of that amount of moneys? And also, your administrative costs decreased by £105,000 in 2022-23. So, in a sense, this is, compared with 2021-22, slightly more. Why was that?

So, first of all, to talk about the underspend, we're unable to keep reserves now because of the accounting rules, but we are able to carry over some amount of underspend, which, I guess, amounts to a similar thing in terms of our budget. And this was carried over from last year—I think it was £74,000 that was carried over.

The investment—I guess it goes into the pot, but if we were to draw a line, it largely funded our public bodies team, and I know this is something that the committee and the Equality and Social Justice Committee have talked about in the past. So, we have, in the last few years, had a team that are a direct link to the public bodies that fall under the Act, and they welcome this arrangement. So, they've got a go-to person; we have a person that covers each region of Wales, and then, for the national bodies, they also have a link person. And so this hasn't been a team that's been in place from the beginning of the commissioner's office, but it's something the public bodies have said they wanted, and we've had some input from the Senedd as well. And so that funding has gone to support the continuation of that team. 

And there was also an additional post, again, sadly, on a short-term basis around equality, and we recruited a diversity inclusion partner, working with us to really help us to reach new audiences and to help with diversity. 

Thank you. I'm not quite clear on the second part of my question; apologies if I'm lumped them together. So, the other administrative costs—total of the administrative costs—went down by £105,000 in 2022-23 when you came into post, compared with 2021-22. And the question, really, around that is: there's a little gap—how sustainable is the lower level of expenditure?

Can I come in?

Please.

So, it's mainly because we moved offices. So, we reduced our office space and all bills are included now in the new office, so that's what explains the big drop in our administrative costs. And we are hoping that will continue. We even reduced further the size of the new office as well, so we are continuing to make savings everywhere we can, but that's the main reason.

That's fantastic. Good. So, depending on external forces, then, hopefully that will continue. But we all know where inflation is. So, expenditure on travel and subsistence also increased by £16,000 to £37,000, compared with the year before, and it's also exceeding the pre-pandemic level. I think I know the answer to this, but, briefly, why was that?

It's basically because we resumed travelling within Wales as well, post pandemic, so that's the first one. The second reason is that we attended Conference of the Parties 27 in Egypt, so that brought additional costs. And it's also important to flag that most of the money we spend on international travel is part of an agreement with Welsh Government, and there's specific money attached to that. Derek can say more about our new approach to travel, but, for example, the commissioner has decided not to attend COP this year, so we are expecting the numbers to go down this year.

Okay. And, obviously, there is a real place for being at these places, but, obviously, we're all in that scenario now, in terms of the public purse, aren't we?

I'm going to move on to my next—[Interruption.] Go on.

I just wanted to add to that. I think the Well-being of Future Generations (Wales) Act 2015 is a real asset for our country. It's seen around the world to be leading the world and good practice in terms of how you do long-term thinking. So, I think that the work that we do internationally, to talk about it but to learn about how others are doing it, is crucially important. But I want to be very careful about when I travel internationally, particularly if it involves flying, and so the process that we brought in is to have a very clear outcomes-led process. So, understanding the outcomes that we would achieve by undertaking this international trip. Could it be achieved remotely, virtually, in other ways? And only then we would fly to an event to attend it. So, that has meant that already, in the last few months, including the decision around COP this year, invitations to fly to events have been turned down in order to really think carefully about limiting the amount of flying that's undertaken by the office.

It's a hugely difficult one, because, you're quite right, you need to be at the centre of these things. There is that element, is there not, of spin-off in terms of spreading the word, but there are other means, sometimes, of doing that. However, it's very different, isn't it, being in the room and talking to people and actually being on screen, as I am at the moment. So, it's very careful—. I'm pleased that you've stated that there is output measure to this, and that careful framework around that too. So, thank you for giving us that extra information.

In terms, then, of around the—. In regard to requests for advice and support received by your office in 2022-23 coming from other parties other than the public bodies covered by the well-being of future generations Act, how do you determine which of these requests are going to be actioned, and what level of resource is used by the office to do that?

So, we have internal criteria to decide how or if we are going to answer requests, and the priority is definitely for public bodies and PSBs, so if we have time, capacity and knowledge for others, then we will respond to such requests, and often it's a request to our team and we say, 'Has anyone got any capacity for this request—"yes" or "no"?' And if people don't have any capacity, we just decline it.

In regard to the income generated by your office, which reached almost £400,000 in 2022-23, the Welsh Government provided the vast chunk of that—£329,000 in contributions to joint projects and the leadership academy. So, the question would be: is the funding, therefore, agreed on a year-by-year basis, or is the Welsh Government committed to longer term support for them? And, obviously, I'm thinking in terms of the leadership academy in particular.

Yes, so I can come in to answer that. I think there's a more general point that I want to make as well about funding from other sources, but the usual process, as I know it, and what we're facing this year, is an annual funding situation. The Welsh Government funding for last year was the international work programme, largely, that Marie was talking about, but also some work we did with Business Wales, and thinking about advice to businesses about how they engage with the public sector in terms of the future generations Act, and how they support the public sector to deliver on the well-being outcomes. So, a tool is being developed and should be published shortly. But those are done on an annual basis, which is my understanding, and then the academy that we run attracts funding from Welsh Government, but it also attracts funding from the private sector and the third sector.

The general point that I wanted to make—and this is something that I want to explore and perhaps come back to you next year in terms of how well that's delivered—is we're facing a very difficult funding situation, as the rest of the public sector is, and I understand that, but I do think there are opportunities for us to deliver against the duties and powers of the commission's office, and to be able to draw in funding from elsewhere, and it may be that we can—. You know, there's already been great success with the academy, as well as the funding for contracts from Welsh Government. But I think there may be opportunities to do that more broadly, so that we use the money from the core funding from Welsh Government, in line with what it is meant to be used for, in terms of the delivery of our work, but that might be supplemented—not in a for-profit way, but in a way to cover our costs—so that we can use the skills and expertise of the team to reach more people. So, that might be, for example, bespoke training for—

To interrupt you, I've got another couple of questions. Could you actually send that in to the committee, in terms of that—

Of course. Yes, of course.

—for example? Because otherwise, I'm not going to get through this, and the Chair is not going to be very happy.

Okay. Sorry, I'm waffling on—

No, no. That would be fantastic, but, obviously, yes, we'd like to see that and we'd like to be cognisant of that. So, if you could send that in, that would be fantastic.

So, I'm going to move on to my next question. Around half of the requests for advice and support received by the office came from parties other than public bodies. How do you determine which of those—? I think we may have touched upon this earlier, so I'm going to move on to another one, then. How does the performance report tell us about how your office has used resources to deliver its objectives?

Well, I think the performance report doesn't break down by individual area, but talks about the key performance measures that were in place and how we've performed against those. I think that is the approach that I want to take, going forward as well. So, you talk about the outcomes that we want to achieve and have the key performance indicators in place that demonstrate how we're achieving those outcomes, and I think that is the best way that we can demonstrate how our resources are being used to deliver against the outcomes that we've set for ourselves.

Okay, thanks. And finally, then: how has your office assessed the cost of the section 20 reviews around procurement—you mentioned that in particular—and how the Welsh Government is implementing the Act? What are the implications, then, for any further reviews that you may wish to carry out?

The section 20 reviews are resource-intensive initiatives, so we would have to plan for them in order to be able to deliver on them, because they would take a lot of time and resource. But I do think there's an opportunity for us to think differently about how the section 20 reviews are undertaken. So, they could be done in a much narrower way. So, for example, the one on Welsh Government—you know, Welsh Government, the biggest public sector body—it covers a whole range of how it delivers against the sustainable development principle, although we did narrow it down and focus on particular areas within that review. But you could be much narrower in your focus in how you undertook a section 20 review, in terms of a smaller public body or one aspect of their work, which could be done in a way that had wider implications, for example, so the learning is shared and relevant for all the public bodies, but you're narrowing down the focus and the remit of the section 20 review. And I think that might be one of the ways that we go forward with this, otherwise it could absorb too many resources.

I—

Apologies, Chair—just before you come in—my son is ill at the moment, so he was just talking to me, so I may have slipped a different question in. I know that you want to come in on that briefly.

Yes. Just to say, on the section 20 review, we made sure that there was learning that is transferrable to all other public bodies. Out of that, we created this maturity matrix, which will become one of the key tools that we offer for public bodies, to measure how they have worked internally to both improve their processes but also the culture you need to change, to enable the Act to be deeply rooted into everything public bodies are doing. So, we make sure that section 20 reviews are not only relevant to the bodies examined, but also for the collective body of public bodies, but also any organisations wanting to apply the Act.

And finally, how have you agreed that your meetings with the Welsh Government are going to be recorded, and those discussions with them? Have you agreed that?

Yes, we've recently agreed the memorandum of understanding with the Welsh Government, and we're going to publish that information on a yearly basis, so we're open and transparent about the meetings that have taken place.

Brilliant. Thank you very much, Chair.

Just on that, where will they be published?

So, at the end of the financial—

Where.

Sorry?

Where.

Oh, 'where'; on our website, I would imagine. I'm not—

And the annual report.

And in the annual report, yes.

Okay. Thank you. Can I just go back to one point? Given that the previous commissioner said her funding level had a negative impact on the quality and level of support and advice the office could provide for public bodies covered by the Act, and also—I think Rhianon Passmore referred to this—that about half of the requests for advice and support you receive come from bodies not covered by the Act, are you permitted to and could you consider charging a fee for advice provided to bodies not covered by the Act, or is that not within your remit?

I understand that we could charge as long as we don't make a profit. That's my understanding of it. So, as long as we cover our costs in doing so, that would help us with the income constraints. So, this is, as I was mentioning, one of the areas that I would like to look at, because I think there is an opportunity to help us to do more by charging for some of that work. I think the other thing to say is that, by putting together—. We've done a lot of work around the strategy, which I keep mentioning, which we're about to launch, and that is because we want to anchor the organisation in some long-term areas of work and focus on those things that are most important, and we will use those missions and that work programme to apply to the requests for support. So, perhaps one of the criteria that we will look at in future is that, if we don't have capacity, and it comes from outside the public sector and it's not in line with those missions, then, that might be an area where we could charge.

And, of course, you come from a co-operative and mutual background in your previous role. When you say that you can't make a profit, can you make a surplus, as long as that's reinvested in the operations?

No, sadly.

I don't think so, no.

So, that would have to be handed back to Welsh Government if you did inadvertently generate a surplus.

I would think so, or handed back to the people that we charged, so that we reimbursed. So, we'd be very careful to make sure that we were just covering our costs.

Can I come in on that?

Yes.

And with the alignment exercise, we lost our reserves, so that's creating a problem in this respect, because it needs investment of time and energy to actually create a business model that would work. We need criteria to know when we would charge or not public bodies, or external ones, so that's something we will need to think about. But that's where we really regret to have lost reserves because, once more, that's where it would have really made a difference and enabled us to move faster into developing a new business model or a cost recovery model.

Okay. Thank you. I'm going to bring in Mike Hedges.

Diolch, Cadeirydd. Follow-up work showed that not all internal audit’s recommendations in 2021-22 had been implemented in-year. Have they been implemented now?

Short answer, 'yes'. 

Yes. 

In your annual report, you note Audit Wales recommended your office review and strengthen compliance with controls and procedures over procurement, particularly single tender actions. What specific actions have you taken to address the issue with single tender actions? 

As I was mentioning earlier, we've reviewed the procurement policy, and I think one of the issues around the procurement policy was understanding it. So, we clarified the processes and we've undertaken training for the staff team so that they can understand how it should be applied. It's monitored closely, so that now, as our audit report has shown, it's being implemented effectively. The other assurance I can give you is that, as part of our internal audit, this year the internal auditors will look again at our procurement and buying just to keep an external eye on how it's working.

While single tender actions are sometimes necessary, that's something, of course, that is of concern to a number of people—including, I'd imagine, the auditor general—in actually identifying that you're getting value for money when you haven't tested it in the market. Have you got any other means of testing it if you're only using single tenders?

Yes. So, as part of our single tender process, we would still do a market check to see that we're paying an appropriate price. I'll give you an example of a single tender action that I've recently approved. As part of our academy work, we invite speakers to come along to participate and give a presentation, and so forth, or run a workshop. In some of those cases, there's not a market for those speakers; it's that individual person that we're looking for. So, we look at the prices that are usual to pay for people making these sorts of presentations, and we've got some history of looking at what other people have charged or what we've been paying in the past, so that we can market test from our own experience, but also from website searches, and so forth. So, we make sure that we're in line with the market and not overcharging.

Okay. Thank you. What are the implications of a change to all but one of the members of your audit and risk assurance committee in 2023? I've always believed in organisations who wanted both continuity and change, so you would change a third or half the members in any one period, so that you've got some people with corporate memory and you've got other people coming in bringing in new ideas. When you change all but one, obviously, you lose that corporate memory. Do you have any concerns about that? 

I did have a few concerns, but I think we've managed it as effectively as we can. So, they have a limit on their term. They have a term limit, which means they do need to step down. But how we've managed it, for example, is that, in bringing in the new members, we've staggered that. So, for example, the chair and two of the other committee members are staying on until the end of this year, and we've brought three new members in now and three members, I think, have now stepped down. So, we're staggering it through the course of the year. There is one member that stays with us who's been on the committee for a few years and will stay with us, but the approach that we've taken to that is to stagger the changes. Because of the timelines that we have in place, we will manage that in future so we don't have that cliff edge with everyone leaving at the same time. The other thing is that it coincided with the new commissioner, so there was a lot of change at the one time, but I think we've managed it as effectively as we can by having that staggering process. 

Just on the ARAC committee, this is one of the areas that I was really impressed with. We have very strong ARAC committee membership, and Sophie was blessed with a skilled and experienced team, and I've been really pleased with the people that we've been able to recruit to replace those that are leaving. So, I think the committee is in good shape.

Okay. Thank you. 

Can I just add one thing as well? We actually changed the term of ARAC members. So, before it was three years renewable and so we had those three and six years, and seven years for the commissioner, as a problem that we had. So, now we've changed it to four years, and, as Derek said, we staggered them. So, we won't have that issue ever again.

Other organisations have people for four years, but they also let some of them do an additional two years, in which case, you're changing every two years, effectively. So, in the future, you get some after six years, and then you get others for four, six and eight. Have you considered doing that?

Yes, this is what we used to do at Cwmpas, and, through the staggering of the terms, this is how we will manage it this time, so we won't have the same situation in future.

You note eight new risks were agreed in 2022-23. I was unable to find any information about them in the annual report. That might be because I didn't look properly, so apologies if I should have seen them, but I didn't see them. Where can I find them, and do you want to explain what some of them are?

Yes. That information, I have it on my screen and I could easily share it with you. Basically, what we've done is a comprehensive exercise to review our risks. So, we wanted to improve the way our risk register was formed, as well as the content and substance of the risks. So, what we did was to merge some of the risks, before we had the risk register, and a reputational risk log as well. So, we merged these things. We merged some risks. We created new ones, and I can give you a flavour as well, and we tightened them up. So, some of the old risks were, as Derek was saying, more of an impact on others rather than something within our control. We had in the old risk register 'public bodies do not address the key challenges and issues facing future generations', so we changed things like this into 'the commissioner fails to discharge their duties to promote a sustainable department principle'. Then, we kept only two risks from the old register—and I'm very happy to send you the two risk registers—knowing that we are just creating a new strategy and new missions, so we'll change the risks once more so everything is aligned in the future. 

Most organisations in their risk registers have denial-of-service attacks, and they have other IT attacks, such as people making mistakes, effectively, and allowing access into the system. I assume you've got both of those on your risk register.

We do, and it's part of the cyber security assurance as well. So, all this is included in our risk register, and where we are very proud of the new system is that it follows the orange book, but we've also tried to have two systems, one that is very detailed and strategic and operational, with clear names and deadlines for mitigating risk, but we also provide a much more strategic summary for the commissioner and our ARAC that is very visual, very accessible. So, our new system has been shown as exemplar by internal auditors and external audit. We are continuing to evolve it as well. We've just included two new risks, so it's a live document that is designed for strategy and operation. 

Okay. Thank you, Chair. 

And just to give you assurance around the risks, it's very much a live document. It's not something that's just put together for the quarterly meetings; it is something that's referred to internally on a regular basis to guide our working.

Okay, thank you. Again, before we move on to the next set of questions, can I just clarify a couple of points on the back of Mike's questions to you? Why did your internal auditors only conduct three reviews during 2022-23 compared with six the previous year, and how did this impact on your assessment of the system of internal control? 

I'm not sure why there were only three last year. I know we have a programme agreed with the internal auditors and we discussed it at last week's ARAC committee, and it means it's a cycle, so that they are staggered and done as appropriate. So, it may be that there were only three planned for that year and others were brought forward, and so forth. But we have a cycle of internal audit so that we do a number each year, and I would imagine that was the delivery of the cycle. I haven't heard that we altered from the cycle that was agreed with TIAA.

Could you perhaps check and clarify?

Of course, we will. 

Thank you very much indeed. Not all of your internal audit's recommendations in 2021-22 have been implemented in-year. Are you on course to action them by the revised deadline of the end of this month?

Yes.

Yes.

Yes, and we've just had two internal audit reports discussed by the audit and risk assurance committee, and I think one had a recommendation, so we get on to them straight away, and the other one was clean.

And finally, before I move on, what specific actions have you taken to address the issues with single tender actions, and what assurance can you provide us with about the controls you had in place in 2022-23 as a result of the changes made?

Okay. So, in greater detail, to complement the response we gave to the Member, we've clarified the exceptional nature of STAs to all our team. We conducted training, we formally record every justification, and I now personally clear every single STA.

Okay, then, thank you. Can I bring Rhianon Passmore back in, then, please, to pick up some questions about your staffing?

Thank you very much, Chair. Over 40 per cent of the staff employed at 31 March 2023 were on a fixed-term contract, and, in that year, six people, I believe, left at the end of their term. Have you evaluated the impact of using fixed-term contracts on the output of the organisation, and actually also on efficiency as well?

I haven't undertaken an evaluation of that, but my personal view is that fixed-term contracts are not an ideal situation for the organisation or for the staff concerned. What we are currently looking at is a reorganisation of the organisation, a redesign of the organisation in line with the new strategy. And, as part of that process, which we're just about to embark on, we'll be looking at how we limit the number of fixed-term contracts so that we don't have so many people on those sorts of arrangements. We do—. Since I've been here, we do have a very good retention rate for colleagues, irrespective of the short-term contract arrangements—so, not a high turnover rate or not a high absenteeism rate—which is, I think, a sign of a good culture within the organisation.

Thank you, and it is very important. Has there been any change in your policy around inward secondments?

No, we haven't had a change of policy. We haven't done as many as we have done previously. The high number of secondments in the past has related to particular projects. So, I think the 'Art of the Possible' project was actually that someone from Cwmpas was seconded into the office of the future generations commissioner at that time to work on that project. We do think it works well for us and we want to continue with that. We haven't been finding the opportunity to do that in recent times, but we do want to continue to do that.

Okay. And obviously, in terms of reportage of that, that's also important.

Moving on, you describe the embedding of a shorter working week into the culture of the office as 'transformative', and that it's increased the team's wellness, which you've already inferred on, in terms of retention et cetera, and also helping you with staff recruitment. What evidence do you have to support that? I would have thought that's pretty easy.

Yes. I think retention, staff survey results, absenteeism, all of these are indicators of how well it's seen by the team. I think, just on this point, I'm undertaking a review of how it's working with our lead for human resources, so we are very supportive of the policy, but it's an innovative approach to this—not many organisations are applying such a policy—and I'm reviewing to see how it can work. Because I think, as part of implementing such a policy, you need to be making sure that you're as efficient and as effective as possible so that people are able to access a shorter working week because you've been efficient about the number of meetings that you hold and so forth. My observation, I think, coming in, is that it's a bit unbalanced at the moment, in that some people are able to take advantage of it—not take advantage of it, that's the wrong word—

Benefit?

—benefit from it, and others are not, because they're too busy. And I think, through the redesign of the organisation and the review of the policy implementation, we'll be able to address some of those concerns. But I think that's a sort of learning process as we go, so that we make sure that it's effective.

It's obviously a really important one to get right. And, obviously, I presume you publish the results of the staff survey—

Sorry, if I can intervene with just a quick supplementary on that just before you pick up your questions, just to clarify, for my understanding and our understanding, is that operating on the basis of staff working the same number of hours over a fewer number of days, or a fewer number of hours overall over a fewer number of days? And if the latter, are you seeing an improvement in productivity to pick up the deficit in hours worked that previously existed?

It's very important to state that it is not part of the terms and conditions, it's a piloting of a goodwill gesture or a test that we are doing with the organisation. So, we let our colleagues decide on the patterns they want to use, and it's something that will be evaluated in the review as well. So, some have shorter days; some try to work over four days instead of five. So, we are seeing lots of different patterns emerging. As Derek said as well, lots of colleagues cannot do it because of workloads, so it's these things that we are trying to understand—so, what really needs to be done to enable the uptake and to make sure that productivity is increased by the measures, because what the evidence shows is that, when done well, it increases productivity.

Okay, thank you. Back to Rhianon Passmore.

I think that's a whole section in itself, isn't it, in terms of that operational issue, but one that is very important and, if it's got right, as in some areas and countries, it's a fantastic thing to do, but it has to be got right, doesn't it?

So, moving on, can you describe the issues with pay parity among staff and why the Welsh Government's actions, really, for addressing those disparities have not resolved them?

Yes. We've been allocated £16,000 for three or four years by Welsh Government to cover the alignment, so we've managed to align all the minima of all the scales of our office. We wanted to do a full alignment within points in the different scales, and, sadly, we were not able to afford that. So, that's the pay parity alignment, and then the alignment of budgeting has led, as we explained, to the loss of our reserves. So, we had between £200,000 and £300,000 reserves in the past, which could enable us to undertake unplanned big projects, which enabled us to front money for designing partnerships, and it would have enabled us to absorb cost-of-living fluctuation and inflation, and sadly, we have lost a lot of that. We also have—

Can I just interrupt you? Going back to an earlier question, briefly, would you say that that was shortsighted in terms of use of reserves, or have you got any thought process around that? Because what you're saying is that they're no longer there to be used. Or was there no—

We were required—we were required to lose these reserves.

You had to do it.

Yes. So, it's not our choice at all.

Okay, fine. That's fine, for clarity. Sorry, did you want to carry on, or have you finished?

I was finished, yes.

Okay, thank you. In terms of your senior staff structure, the first commissioner introduced a more linear structure that didn't include directors. Do you have views or a position on that, and are there any plans to review it, please?

Yes. It's being reviewed at the moment and we've got a meeting with the staff team tomorrow. What we've done in the last month is talk to colleagues about what they like and dislike about the current staff structure in order to inform that. I know that, in the past, we've talked about it being a flat structure; it's not a flat structure, we have a number of grades within the organisation and similar in terms of the levels of grades that I was used to at Cwmpas. But I will be looking to make some changes to that to reflect points raised by colleagues, but also to make sure that it's aligned to the new strategy.

Okay, thank you. There seemed to be some gap in terms of the appointment of a finance director or head. How did you manage that? Very briefly.

I took on a lot of the functions, and we had a very experienced consultant, Ian Summers, who was working at Audit Wales before, so he covered the interim period.

Thank you. In terms of the payment that is termed around paying 'benefits in kind' to staff, for well-being gifts and office trivial benefit, how have you assessed the impact on staff? Bearing in mind the pressure on resources, how do you continue to justify that?

Well, the truth is that the well-being gift has not continued, because we haven't been able to afford it this year with other pressures. We still have the Cwpan Calon arrangement, but the well-being gift, which is the more significant gift that was brought in, I think, during COVID, has been stopped due to budgetary pressures.

Okay, thank you. I'm going to move on from that, and I suppose this is a cultural question, or a leadership question: how concerned are you about your gender pay gap, and how would you assess the progress that the office has made on increasing diversity of the workforce? And what are the next steps that you're taking to increase diversity?

Well, equality and diversity are absolutely fundamental to my values, but also to the way in which the organisation has worked. I'm never complacent about any pay gap, but the pay gap within this organisation is much smaller than the national average. I think our mean pay gap—I'm looking for it—is 1 per cent, so it's a lot smaller than the national pay gap. So, a lot of work has been done on that area. I've been so impressed by the work that Marie and the team have done around diversity and equality. We have a high number of people from a black, Asian or minority ethnic background and we've worked hard to improve our diversity in that area. I think it's around 17 per cent. But we talk regularly about this and we look to try to be a representative organisation. One of the areas where we're not doing as well as we could do is in the area of disabled people and having more disabled people within our workforce. So, we're putting our attention to other areas, where we know that we need to do more to attract disabled people into our workforce. So, I guess the point is that we monitor it regularly, we try different things to improve our diversity within the organisation, and, where we are not doing well, we give that more of a focus, and, as I say, disability will be the focus, going forward, for the foreseeable future.

Just finally, within that, you mentioned 17 per cent around ethnicity appointments, is that captured in terms of pay gap data as well, or are you looking at it in a sort of macro way?

I'm not sure if we've got the pay gap data.

It's something that we debate a lot. Because our workforce is so small, we need to protect the privacy of our staff. So, it's something that we discuss very regularly, and, so far, we have chosen not to disclose it to protect their privacy, but it's something that we will continue to debate and discuss with our ARAC and continue to make decisions. But, so far, we don't publish it for that particular reason.

No, I understand that. Okay, thank you very much, Chair.

Thank you very much indeed. And because I missed—[Inaudible.]—could I just ask one supplementary? You might say, 'Yes; we've already told Rhianon that.' But, going back to the issue about pay parity with Welsh Government, in July last year, Welsh Government said that it was taking steps to ensure that workers in arm's-length bodies, including your own, would be paid at least the same as the minimum salary for their equivalent Welsh Government grade. Is that now the case?

So, as I explained earlier, minimum yes. We wanted to do full parity and we couldn't; we cannot afford that.

But you are at least the same as the minimum salary for the equivalent grades.

Yes.

Right. Okay, thank you. We're fractionally over time. I've got a final set of questions, but I don't think we'll get through them all. So, if you'd be agreeable, we will write to you with the few remaining questions.  

Of course.

I will ask the first couple of these, just to conclude. How does your funding from the Welsh Government for the next financial year, 2023-24, compare to that set out on the estimate for the financial year, and has your office been advised of any shortfall?

Do you mean the next financial year—2024-25—or the one we're currently in?

Actually, 2023-24; you're correct, yes. How does your funding from the Welsh Government for this financial year, 2023-24, compare with that set out in the estimate for the financial year?

We'd have to go back to look at the estimate, but you can see that the funding that we've received from the Welsh Government—. Well, the overall package of funding that we get, because we get funding from different sources, is slightly less than it was the year previously. I think my concern is perhaps looking forward to the year ahead, given the budget situation that we know we're facing in the public sector and the impact that is going to have on our workload. I did want to make the point and let the committee know that we're very keen to ensure that the new public bodies that are due to come under the Act on 1 April do come under the Act. That will have implications for how we deliver things and how we prioritise, but I think it's very important that the public bodies—Transport for Wales, Social Care Wales and others, Qualifications Wales—that were set up since the legislation are subject to the Act in a way that the rest of the public bodies are. I think that's really important in terms of this agenda. This agenda is urgent around climate, the environment, health, the economy and so forth, but also I think it would send the wrong message if that were delayed. So, I know I'm looking forward to the next budgetary year, but I want to find a way in which—within the resources available—we can support the new public bodies to come online as planned on 1 April 2024.

I'll finish with a conflation of some questions. Are you content with the engagement you've had with officials regarding the 2024-25 budget? Do you know when you will know what your allocation will be, and if so, could you advise us? And you mentioned implications if you don't receive funding for the eight additional bodies the Welsh Government proposes to add to your remit; what would those implications be?

Sorry, I covered a bit of this ground. I was jumping ahead, wasn't I? But we've had very good engagement with Welsh Government officials around the situation that we might be facing and the different scenarios that we're facing. The challenge that they have and that we have is the timescale. Because we don't have reserves, and because we don't get final confirmation until the Welsh Government budget is agreed, it makes it very difficult for us to plan the organisation well ahead.

As I mentioned, we're having to go about on a redesign of the organisation on the basis of the information that is available to us and on the best available information that we're able to get from the Welsh Government about what the likely funding situation is to be for us. We cannot wait until January, because then we will have a budget that's too high for the next financial year. That timetable makes it extremely difficult for us to be able to plan our finances for the next financial year, but we will have to work within the information that we have.

We understand the huge pressures on public finances. Right across the public sector, it's very clear what the situation is. I believe we have a strong case for our budget to be protected and potentially increased in line with inflation because of the work that we do. We will be making that case, and it'll be for the Minister to take that decision, but we understand the very challenging situation that we face.

Thank you. I'll stop at that point, as we are nine minutes over now. Thank you both for attending today and answering our questions. As you would appreciate, a transcript of this meeting will be published in draft form and shared with you in advance to check for accuracy before the final version is published. That brings this session with you to an end. May the rest of your day go well.

Thank you.

Thank you very much.

Members, I propose in accordance with Standing Order 17.42(ix) that the committee resolves to meet in private for the remainder of today's meeting. Are all Members content? Thank you. I'd be grateful if we could go into private session.