National Assembly for Wales

Yes, we told the Public Accounts Committee that we are working on these costs because we are, obviously, halfway through this year. And while we have learned quite a lot, there's still quite a lot to learn, because the demands on the public purse are changing all the time. We know for a fact that we've saved some money in travel costs, but that's started to change now as people are coming back into the Assembly—into the Senedd, sorry. So, while there are items such as some utilities, some printing and stationery, the demand for those are actually on the rise. And whatever we may have saved from maybe not coming into the Senedd—certainly members of staff, as well as ourselves, of course, all know what this looks like—we're spending more on equipment for 'at home'. So, how that's affected how we've looked at the budget for next year, which I guess is part of the reason for this question, you'll see in some of the budget lines. For example, travel and subsistence for staff has gone down a little bit, but you can expect to see rises in some of the kit that we need in the ICT lines of the budget. 

One of the things perhaps I should raise at this point—and I think you'll be aware of this, Cadeirydd, from the meeting in July—is the situation with annual leave accrual. Now, this isn't a cash item but it will actually affect what's on the face of the budget, as we go forward in this. And it's looking, at this stage, as if we may have about £0.5 million-worth of accrued leave, which will need to be reflected on the face of, probably, a supplementary budget, I would think. But I would just reinforce the point that, of course, there's no cash effect on this.

Well, I could say, of course, that staff have been working very hard during this period. There will be certain departments that have found it quite difficult to take any leave. But as to how the actual figure has been arrived at, perhaps I could ask Nia maybe to take that one.

Nia.

Thank you, Suzy. Yes, this is under international accounting standard 19. It's a provision that we're required to make at the end of the financial year—the provision that's in place—and this has arisen because of the change in that provision. So, we're looking at quite a significant increase in the amount of annual leave that staff have accrued. As Suzy mentioned, we've just run the figures now, at 30 September, and the figures have come out at about £0.5 million. But, obviously, between now and the end of the financial year, we're looking at staff accruing an additional 15 days of leave, and it's looking to see if staff have the opportunity to take that leave within this time, considering that it's a busy calendar of Senedd business. We've got the exit from the European Union coming along, also COVID has impacted on us, and we've also got the transition to the sixth Senedd. So, it's quite a burden on staff and them having the ability to take annual leave, when there isn't that large period of recess, before 31 March. So, we're monitoring it very closely. And, as Suzy said, there's the expectation of us coming and asking for a supplementary budget towards the end of this calendar year.

Perhaps I can just reassure Members that a zero-based budgeting exercise isn't just for now; it's a rolling programme that happens throughout the Senedd term, focusing on different areas of activity, I suppose. But the purpose of it mainly is to give the accounting officer complete reassurance that budgets are appropriate for the tasks that are required in those service areas, and those service areas, of course, ultimately meeting the strategic goals of the Senedd. So, to be honest, I wouldn't have expected a huge amount of change in some of these lines because they're there as 'business as usual', in one sense, and all departments are affected by zero-based budgeting throughout the year. I personally find it reassuring, as I say. If there are any specific lines you wanted us to—. I think you mentioned income and car parking there, Chair. 

Well, there'll be certain activities that, regardless of whether we're semi-closed or not, won't affect the budget. So, staffing is obviously our main budget line and staff have to paid whether they're in the building or not. We have certain contracts that have to be complied with whether we're in the building or not, and so you wouldn't expect to see huge changes in those either. I'm sure Members will understand that it's those items that actually stay pretty much the same, because they're not based on assumptions; they're based on knowns, and that means that there's little opportunity for us to make many changes. I'm trying to think of some examples I can give you. The cleaning contract, as I mentioned earlier, is not likely to go down because it's already in a contract. Our car parking charges really only have quite minimal effects on the overall budget anyway, and, I don't know, something like furniture—well, we're either going to need the furniture or we're not going to need the furniture. It's a budget line that can't be changed in the response to COVID. If anything, there's an argument for saying that the furniture line might actually go up, because, if we're going to be doing more homeworking for a prolonged period of time, more members of staff, let alone our own members of staff, are going to need to think about their furniture requirements at home. 

Yes, we are. Of course, the priorities change—nothing new in that, in one way; that happens every year. But COVID has had an impact on the project fund, as I'm sure you've seen in the actual budget itself. As we go through this year, we'll probably be able to give you further updates on that.

But one example that you probably all noticed, actually, is the 'delay project', as we call it—so, that's the setting up of all those security barriers and so forth in Tŷ Hywel and the in the Senedd—in that we brought all that forward, not only because of the security reasons, as we intended to have them in the first place, but they're actually a help with COVID protection as well. With all these screens up, we would hope, and I hope you agree, that that limits the opportunity for the virus to come into the building. We've also brought the fire doors in from last year, because obviously that's to do with our safety. We can't keep delaying that forever more. But because we've brought those in, other changes to the project fund have resulted, which you will have seen, then, as we look forward into the next year's budget.

Some capital expenditure has to continue because we need it, and I suppose we're in a fortunate position in one sense, in that, when we come to the project fund, we have to worry less about a distinction between revenue and capital funding, because we account for it properly and the capital funding is in a longer term programme anyway, certainly for estates and ICT. We've got rolling programmes for those, which Members will be familiar with from previous years' scrutiny. 

Well, it's a very good question. We can't foresee what the new Commissioners will have as their priorities, and as I hope I explained a bit earlier, so much of the budget that we've been able to prepare is based on knowns—money that's already earmarked for certain expenditure—that what's left in terms of flexibility is pretty small. The project budget: that's just under £1 million in total. Some of that is, effectively, earmarked for the legislative workbench, which means that we're talking, perhaps, about £600,000 or £700,000 that Commissioners will genuinely have available to them in the next Senedd for meeting their own priorities. Part of this, of course, is due to the hard work that's gone into streamlining the budget that we've had in this Senedd term as well. We kept the overall increase of the operational budget at just 1 per cent, which is pretty amazing considering all those things we were talking about earlier that we've got—not only completing this Senedd, but Senedd reform and the transition period and so forth—which will flip over into the next Senedd term as well. So, they haven't got a lot of money to be flexible with, but what they've got, they can be as flexible as they like with. I think that's probably the best way of putting it.

I think, to be fair, what I'd have to say to that is, again, that would be a matter for the next set of Commissioners. But you're quite right: Members will want to see some—. I hope I've reassured you that there are long lines of sight in all this, but a specific commitment, I think, would have to be given to the next set of Commissioners. But I hope it's something that they'll take seriously. The perfect example for me would be the issue of the windows, for example. We've brought this to your attention before. This is something that will have to be considered by the next Commission, almost whether they like it or not. I would be reluctant—and I'm sure you'd be as well—if suddenly it was seen as an issue that the next set of Commissioners would think was not important. It's important, because this is about health and safety, let alone the sustainability of the building and the energy of the building and so forth. So, I'm giving you a slightly wobbly answer there, Siân, because even though I think this really is a matter for the next set of Commissioners, there are certain things that worry me that I want to be sure that they're telling you about.

Well, the simple answer to that question is: we can only invest in the estate if we've got the money to do it, and whether it's part of the planning. You're right though that that gap has been used in the past. I'm sorry I can't give you a specific answer, but you'll have noticed in the last period of recess we had that the fire doors that I mentioned earlier were brought in. So, you're quite right that it's a time when that kind of work can be done. We have to be careful as well, though: the budget year ends just before dissolution, so I'm kind of more concerned that the work that we've got planned for this year gets completed in time before we trip into the next financial year. I don't know if Manon has any specifics on that, but a rolling programme's a rolling programme. Have you got any timelines on this one?

We don't have anything particular slated for dissolution on this occasion other than the current slate of maintenance work and so on. There were some ideas and options put to the Commission in terms of our response to the pandemic situation, but we're talking about such a fluid and uncertain position that it is difficult even at this stage to commit to something in March and April of next year. But we will certainly be keeping the situation under review and we will be, as an executive team, bringing options to the Commission to consider.

Yes. You're absolutely right. I mean, I think we've had to accept that with the existence of COVID and social distancing and people not being able to travel more than five miles, and all those regulations that were in place right at the beginning of lockdown, have delayed the process that we were hoping to do with the windows. However, we'd only made a commitment for a feasibility study to be prepared for this year, not least because the overall project would be expensive, but we wanted to know what was the most cost-effective way of doing that. It may be that some of you will think, 'Well, we'll just fix the windows that are broken', but actually, for example, it would be erecting all the scaffolding that's actually the very expensive part of the process, and so why would you do that for a couple of windows? And perhaps I should explain—. I'm pretty sure it's this December we're expecting the report on that, the efficiency process feasibility study.

In terms of transparency, I really hope that the committee has seen how far we've come in terms of preparing transparent budgets. Certainly, as a Member myself and having learned from the situation with the committee rooms right at the beginning of this Assembly, we want to be as clear as we possibly can be with how projects are rolled out and what the ultimate costs would be. So, with my Member's hat on, yes, I would like to see this be as transparent as possible, and I can't see—. There's no advantage to us in not being transparent as a Commission.

Yes, I think this is part of the bigger question on the energy efficiency, if you like, of the building as well as other elements of sustainability. I guess this is where actually having a slightly older building has presented us with a system that's extremely suitable for the worries that are affecting people at the moment about COVID and so on, because what we've got in the Senedd is a system whereby fresh air comes in and used air goes out. It's not recycled; we always have fresh air into the building. Obviously, we can open some windows as well. I mean, I only mention that because Jenny Rathbone did in PAC a couple of weeks ago. So, while this system is quite old-fashioned, really, it's probably serving us really well during a period where we're concerned about the travel of people's breathing and so on. So, I don't know if that helps at all.

Diolch, Gadeirydd. A couple of questions. We've quite a lot of homeworking. Have there been savings due to people working at home? And have there been additional costs, and if there have been both, how do they balance out?

Yes, you're right, Mike. There has been both. With people not coming into work, the call on the transport and—. Sorry. People's travel and sustenance budget has obviously gone down, but that's been replaced, then, with costs for taking kit to people's homes and actually getting new kit at home. And let's not forget, there's been a considerable investment in trying to get, first of all, a virtual Plenary session going, and now the hybrid Plenary session going, plus our virtual committees of course. So, what we have saved on one hand, we have spent on the other hand to respond to the needs of all this. Looking forward, I think we've already had—Nia, you can correct me if I'm wrong on this one—we've already had some early indication that the costs for utilities and energy are going up, almost to a degree that soaks up half the savings we probably know we've already made. I might have overstated that. Am I on the right lines, Nia?

Diolch, Suzy. As you know, we sent a letter to you in response to your request back in July and that letter set out a number of the savings and the costs that we've been experiencing, but that was at quite an early stage into the financial year, so what we're proposing to you and the Public Accounts Committee is to provide you with an updated letter as to the position now at 30 September.

Obviously, there will still be a number of changes and new assumptions, and new costs and new benefits coming through, so potentially we'll need to provide you with another letter later on, but it's just to receive some feedback from you as the committee whether that letter served your purpose. Because the letter itself was split into four pieces, if you remember: it highlighted the changes to the project fund; it also highlighted the annual leave accrual that we discussed earlier; and then it had two other sections, one on Commission related expenditure, savings, benefits, et cetera, and one on the Members' remuneration budget. So, it would be interesting to know whether that letter covered the areas that you wanted and in enough detail, as we're now preparing a second letter for you. So I won't repeat what's in the letter, but more of a similar type of information and at a particular level of detail.

We'll reflect on that, certainly, and we'll let you know as we consider the evidence today. But certainly, it was at an earlier stage, and obviously the figures will be more meaningful now as well, won't they? But yes, okay. 

What measures have you put in place to support the well-being of staff during the pandemic and how are you monitoring their effectiveness?

Yes, we touched on this earlier, and I might actually defer to Manon for a fuller answer on this. But the fact that some members of staff have been willing to and prepared to work at home has actually reduced the level of absence that we've experienced in the very recent past, which leads us to a lot of questions about what's going right with that, and if there are any downsides to it. It hasn't affected productivity, which is also a very good sign.

Sorry, Mike, was there anything else you wanted out of this question in particular? Because I may just transfer to Manon for details on the specifics of how we're supporting staff.

Let me try and put it simply, as I often do: what we've got is a number of us working, sometimes in the office in Swansea, sometimes at home. When I work from home, I end up using my ICT. Sometimes I tend to generate cost to myself on my ICT. I'm not complaining about it, but there are those taking place where they're not generating costs for travel, and I was wondering if you were getting any benefits of that.

So, when I was speaking earlier, of course, I was talking about the Commission's operational budget as opposed to the rem board stream of work, if you like. And like you, Mike, I've had exactly the same experience, and while it's been quite useful for me to be able to sit at home to do some of this work, I spend an awful lot less time in the car, so it's actually improved my productivity in that sense. I know that the kit—I mean, this chair that I'm sitting on now really isn't suitable for my purposes, and, like you, I haven't just used the opportunity to go and get a new one.

If you remember, the rem board is keeping an eye on Members' costs and Members' experience of operating during COVID, and perhaps this is an area and a question that I should take to them rather than trying to deal with it myself, because, like you, I am only speaking from my own experience. If we have a situation where, shall we say, 30 per cent of Commission staff stay at home, which is a figure that we've concluded is a genuine possibility—and it's not related to what the Welsh Government has been doing in any way; it's an external investigation based on a range of surveys and feedback—then, yes, there will be some savings in terms of travel costs, but there will be some mitigating expenditure on what somebody will need at home for that. I don't know how many of your members of staff are using their dining tables at the moment to be their office, and that's not really a sustainable way of working. 

No, I accept that. I think that what you've got, though, is a situation where people are using their offices, if their offices are close to where they are, to try and access the system. I include myself in that.

Yes.

And I was just showing concern that there are savings there that don't appear to me to being shown.

Well, it's not that they're not being shown. Again, I'll refer you back to that comment I made earlier about travel and subsistence costs have fallen—it's in the draft budget, if you want to have a look; I think it was table 6, Nia, if you could remind me of that. That'll give you a bit of sense of that, but, whatever you save there, we're spending either within that same territory on providing home kit, or some of the money has gone to what I talking about earlier, which is making sure that we can have a hybrid Plenary and that we can have virtual committees. 

The letter that we'll be sending will demonstrate the costs and savings that are being made in this current financial year. Within the budget for 2021-22, the one that we're discussing, obviously we can't forecast with 100 per cent accuracy, but, as you know, as we've developed through this fifth Senedd, we've changed the way that we budget, and, when there is an underspend on the determination budget, the Commission doesn't use that for its own operational purposes; that is ring-fenced and is then available for the Welsh consolidated fund to use elsewhere. So, you have that reassurance, if there are greater than expected savings on particular areas of the determination, those do not subsidise the Commission's operational expenditure.

Was that what you were going for, Mike, on that?

Yes. 

Okay. That's great.

It is difficult, and some of us work from our offices and people work from home—none of it is easy, but it does save us travelling back and forth to Cardiff, which is a saving each day when we have a meeting. And that was the point I was trying to make, and we should be netting those off somewhere.

Yes, I think we probably will. Again, as rem board expenditure, if we are netting them off, it'll be in the type of things I was talking about earlier—well, actually, you may want to raise it yourself with the rem board—cost of broadband and new chairs, as I say. 

Okay. Any further questions, Mike?

No.

No. There we are. Okay. On we go then to Nick Ramsay.

Diolch, and good afternoon, everyone. In looking forward to the sixth Senedd, how do you see staffing resources and services being developed and prioritised to support that Senedd?

Do you mean in terms of will we need to change our staffing structures—will we will need to change Tŷ Hywel? Do you want to give me a bit more scope on that?

Yes. I suppose it's difficult at the moment, because everything is pandemic orientated, isn't it? So, your prioritisation is going on there. So, really, it's just any priorities that you have beyond that for that next Senedd, yes, in terms of Tŷ Hywel—you've covered part of this already in your answer to questions on the windows et cetera to Alun, so I'm probably covering similar territory there, but just an opportunity for you to give us some of your general priorities for that Senedd.

I think, in terms of staffing, which I think you mentioned in your earlier question, certainly the priority both in this financial year and certainly looking forward will be to make sure that staffing resources are kept within budget. We've just been through a capacity review fairly recently, which was very successful. We've seen the benefits of it during this particular period, when we've been asking members of staff to divert to different departments, to work different hours, to work from home or not from home. So, the sense of the Commission staff being one big team now, as an ethos, has really bled through, and I hope we would all be grateful to the staff for the agility, if that's the word, that we've seen them show over this period of time. 

There will be another capacity review in the next Senedd term, which will help, of course, inform the new Commissioners on how they will prioritise, because they'll be prioritising according to their new goals, of course. But, as ever, all budgeting decisions are made on the basis of a ruck of evidence and prioritisation.

Am I right in thinking that—? Listening to the previous conversation, I think you mentioned about 30 per cent of people working from home. So, even once the pandemic is over, are the Commission looking at—? Like other organisations and businesses at the moment, they're saying to their staff, 'Well, actually, if this is working for you and it's saving money, then this is something we'd like to expand in the longer term—the homeworking.' 

Well, we're always looking at different ways of working, which are primarily to support the well-being of the staff, of course, because, regardless of what our goals and aims are, if the staff are unhappy or there's a high rate of sickness, they won't be able to support us all in the work that we do, for example. So, yes, of course, looking forward, why would we not take advantage of the things that we have learned from the pandemic? 

It may not always save money, of course. Making everything virtual isn't always a cheap way of continuing business, and I bet at any point during these last six months one or all of us will have been tearing their hair out because their bit of kit hasn't worked or their broadband has gone down. So, it's not a straightforward, 'Let's send 30 per cent of people home and save a whole ruck of cash'. There will always be a cost element of that, which is just a bit difficult to pin down to a figure at the moment, Nick.

Thanks.

Sorry, Nick, do you mind if I interject here just with a couple of questions around—? In previous scrutiny sessions, we've talked quite a bit about a cap on numbers of full-time equivalent staff, if you recall, and there was a discussion in previous scrutiny around the voluntary exit scheme and demonstrating whether that has achieved some of its benefits. Now, my understanding was that the Commission had agreed to provide a report by September on what that had achieved and other similar savings, potentially. Clearly, I know there are other things happening at the moment, but I was just wondering whether that was still an intention—to provide us with some sort of reflection on that process.

May I respond?

Yes. I was just going to say thank you for your patience, but 'yes' is the short answer. I don't know if you want to add anything, Manon.

That's okay. I had a couple more questions, on votes at 16 and how have plans for awareness raising and engagement for votes at 16 been impacted by the pandemic. I imagine by now we would have been quite a long way along the process of raising awareness, but I imagine resources at the moment are more concerned with actually making the election work for all voters. So, where are we with the 16-year-olds?

Okay, well, we're talking about this year's budget now, aren't we? So, there's money in the current year's budget to help with this, as you probably remember from this session last year. The effect has been, as you would expect, quite serious. The estate has been closed. The ability for outreach work has—well, it's stopped. Everything, more or less, has moved online. But it's moved online pretty successfully, I think, particularly as we're talking to a cohort of people who live more online than perhaps many of us do. So, the materials, certainly, that are being used for, or were designed for, school outreach, they've been reconfigured so that they can be used online; they're appropriate for home schooling, rather than by teachers in the classroom, for example. And there's a range of virtual events that are making up for the lack of face-to-face activity. The Youth Parliament, of course—the Members of that Parliament have themselves been doing some awareness-raising work on this. And I suppose one of the things that I think has been a happy accident from this would be that it has accelerated the work that the Commission has done, with the blessing of the Commissioners, actually, to reach out to parties who have not particularly taken an interest in what happens in our place of work in a way that we would all have liked them to. There's a real emphasis now on reaching those parts of Wales that we haven't reached before.

Great. That's fine. Thanks, Chair.

What does that mean?

The reaching out bit—yes?

Yes.

Oh, right. Okay. Thank you. Sorry, I wasn't quite sure what you meant, then. Yes. As we know, one of the areas of satisfaction—. One of the areas of Commission activity that's had the lowest satisfaction in the past has been to do with engagement, and that's because, I think, just to summarise this, we've been doing the same old things that we'd always done and, therefore, we were reaching the same people.

But this is more about—and it's primarily through social media, which is why I said that this was a sort of happy result of what's happening with COVID—the way that the social media activity has been both strategised and then planned has changed since this time last year. I'm more than happy to defer to Manon on the specifics of this, but, in effect, this is less about how many people we reach and more about who we are reaching and what is the effect of our engagement on them. And so, to give an example of how it was being done, perhaps, last summer when the beginning of this work had started to take place, when we had the GWLAD festival, for example, someone like me was far less interested in how many people attended GWLAD and was more interested in discovering how many people understood what was then the Assembly better; how many people were interested in politics as a result of it; and how many more people were prepared to take part in politics. That work has now, inevitably, moved far more online. Is that enough of a flavour for you, Alun, or would you like a bit more detail from Manon?

Well, I can offer you some reassurance on that one, Alun. The bus has gone, for a start. We've come to the same conclusion as you, really, which is about trying to communicate in a way that helps people understand why the Senedd is so important for them in their lives. So, the whole tone of communication has already started to change—perhaps with some committees more than others, I'll say myself. But we're already starting to see that kind of warmer, less formal, less about, 'The committee is doing this today' and more, 'How the work the committee is doing affects you' and 'What do you think of that?'

One of the pieces of analysis that's already been done is to show that there's an increase in the amount of engagement with social media. So, it's not just people sort of clicking on to it and seeing it, but actually coming back with responses. You'll notice that some of the way that we're represented on social media is in an inquiring way; it's a way of inviting people to come in and give their responses, to give their views. We're on the road to doing what we always hoped we'd do, which is putting the citizen at the heart of what the Senedd does, and that's why this fairly recent—and you'll have to bear with us on this—fairly recent change in the direction of the engagement strategy is not only important, but has already started to show results. I don't know if Manon wants to add to that.

I'd be happy to.

I was surprised when I saw the advert initially for the director of communications, because I recall, about a year previously, as you said, we'd brought in a director of communications and engagement, and I think this committee previously looked at a restructuring, because there had been a pay-off above a certain sum that went to a previous postholder, and we needed to bring in new skills, et cetera. When we made the appointment for director of communications and engagement, was it envisaged at that time that we would then advertise separately for a head of communications and a head of engagement to work under them, and were those costs fully considered?

I'm going to ask Manon to give the majority of the answer on this one, if that's okay, but I think it would be fair to say, just reflecting on our answers to Alun, that we started off by saying this is where we had our major concerns. We have three strategic aims in the Assembly, now Senedd, one of which was engaging with the people of Wales, and we weren't doing it effectively. It needed a wholesale restructure. As you say, one of the purposes of the VES was to create the space in which we could put that team together, if you like, and the individual personnel—it needed a wholesale change. So, it was almost inevitable that we would need more senior staff there. In terms of timeline and costings, though, I'm happy to defer to Manon on this one.

Thank you, Suzy. The short answer, Mark, is 'yes'. We did envisage a reorganisation of the communications and engagement team, although the details of that, as you would expect, were not finalised until the director had been appointed. So, obviously, we wanted him to have input into the final new arrangements. Those proposals were presented in February, to my memory, to the Commission. Unfortunately, then, we weren't able to press ahead with recruitment because of lockdown, but, obviously, we're back on track now. But all of these have been costed into next year's budget.

Could I just—[Interruption.] Apologies. Could I just add that the head of comms role, that isn't a new post? There was a postholder and that person has left the organisation, so that's a true vacancy.

So, will we now have three posts above a certain level of salary in this area where we previously had only one, or would that not be a fair characterisation?

No, the director replaces the director that was there before. As Nia said, the head of communications replaces a job that was there before. May I write to you on it, because it wasn't an entirely like-for-like replacement? As you can imagine, that's why we wanted to restructure. So, having looked at it all, I'd have to get back to—. I wouldn't wish to mislead you with misremembered details, but the entirety of the restructure has been costed into next year's budget.

Thank you for your answer, and I entirely understand the need to write with the more detailed aspects. Thank you. Could I ask about the new website? Is all the spending for that coming in the current financial year?

Yes, it is, Mark. I think it's due to launch in November, it might be December, but I think it's November, and the ongoing costs and the oncosts will just be factored into next year's budget.

Thank you. And can I ask about some different EU transition scenarios and the potential impact of those on Commission services and the 2021-22 budget?

Right, yes. We don't know whether there'll be a deal or not, which may or may not have an effect. I suppose where you notice some impact will be—or where there'll be risks, I should say—is, for example, ICT, mainly with hardware. That might be more expensive. There may be freight disruption when we need spare parts for various things. I would imagine there'll potentially be exchange rate effects as well, but I don't think these are going to be the main things that are worrying us, to be honest. For us as a Commission, the main risk is, and always has been, that we don't have enough people with the right expertise to guide us as Members in particular through the changes that Brexit will bring, whether there's a deal or whether there isn't a deal. Members will remember that, for the last two or maybe three years, we've raised with you the need for the legal expertise as much as anything to get us through all the secondary legislation that the Commission's had to deal with without the great cohort of staff that Welsh Government has had. So, yes, I still think myself that's where the main impact is going to be. We've got the opportunity, as we've done in the past, of bringing in some external academic expertise to help with that. But, n terms of things like hardware, I think it would be fair to say that that directorate is buying in what it thinks it needs now, just in case there's a problem with accessing parts or something as we go forward. I don't know if you've got anything to add to that, Manon.

That's pretty much it, Suzy. We've been reviewing our procurement to mitigate any risks in that area. As you say, there could be price increases if there are currency fluctuations, and there might be disruption of freight into the UK, but we've done what we can to mitigate those risks. Then it is the access to academic expertise through our Brexit academic framework, which has already paid dividends and which we'll continue to call upon. Then we we've also made sure that there are tools within our HR department so that service areas can identify knowledge, skills and experience they believe will come under pressure during the winter, and call on staff with those skills from other parts of the organisation. So, we aim to be agile as a staff team and respond.

May I just thank all three witnesses for what you're doing in dealing with the particular challenges of the COVID situation, as well [Inaudible.]? Thank you.

Okay. Last but not least, and it's going to have to be brief, I'm afraid, Rhianon—Rhianon Passmore.

Diolch, Chair. Thank you. I was experiencing some IT difficulties earlier, so my questions have been asked. But just to refresh some of the detail very briefly, if the Chair will let me, I'm very intrigued that the sickness figures have reduced during a period of homeworking. So, very quickly, is there any analysis of this, bearing in mind obviously the public health emergency that we're in at the moment? And just a point, really, in regard to any investment in terms of agility and resilience in staff capacity in terms of what we're facing in terms of the pandemic now, and any future pandemics, and the EU transition in terms of the academic framework that you've mentioned—that is very much welcomed—and, in a sense, the monetary cost of that. Although we, as the Finance Committee, need to have that articulated and scrutinised to the nth degree, we also realise, and I also realise, that that is absolutely imperative for us moving forward. So, is there any comment in terms of the sickness figure that you mentioned earlier?

I suppose I would just add that it reflects real life, doesn't it? There'll be some individuals who, because they don't have to travel two hours in and two hours out of work, are themselves already feeling better, and when they are at their computer, they may have more flexibility about when they can do that. They've got time to spend with their children or anyone that they're caring for during working hours instead of feeling the strain of that, and going off sick, maybe. There are certain advantages to doing this, but I think we need to recognise as well, Rhianon, that there are disadvantages to it as well. For some people, being at home and working really doesn't work for them, and maybe even for those same reasons—because there are children distracting them, because they have other caring responsibilities, because they don't have very good broadband, or perhaps because there's no space in the house to work. For some of our staff, the kind of pressures on them are exactly the same as on some of our children trying to learn at home.

There are some work streams that have come out of the current pandemic, one of which is looking at—if I just call it this—HR in the round. I'm looking forward to hearing more about the findings of that work stream, not least because we want our staff to be well and productive. But if there are ways that we can take our foot off the accelerator on looking for new accommodation or anything like that, then it's all going to help, isn't it? What it may affect as well, of course, is the churn. We rely in budgeting on an assumption that certain members will just leave and go and find new work at some point. The churn is down a little bit, but then it's been artificially high in the past as well, as a result of things like the VES. So, I think one of the pieces of work that I expect to see coming out of these work streams is where do we settle at being able to fix a figure for including churn in the budget, because we're running it at the moment at about 3 per cent, which is a very sensible figure based on averages over several years, and so forth. Am I saying that right, Nia?

That's fine. Thank you. 

Rhianon Passmore, we'll come on to you. 

Diolch, Chair. What can you and your investigation officers do to ensure that there is less maladministration, reducing the number of health complaints? 

I think that we can do a lot to reduce health complaints and also, I hope, maladministration within health boards. I think that culture is everything. We have seen a lot of good work. I should take this opportunity—this is going to be my last session as ombudsman for this financial year—I'd like to thank not just the improvement officers that we employ, but also all the offer staff for the contribution that they've made. We've seen some significant reductions in some of the volume of health complaints for most of the health boards in Wales in the respective year; we've seen some substantial reductions for Hywel Dda, for Swansea Bay as well. I was disappointed to see an increase for Betsi Cadwaladr, but I think even there there is some good news in that I think from our intervention rate, where we measure the level of maladministration—that went down in Betsi Cadwaladr from 41 per cent to 31 per cent.

So, that is a reason to be cheerful, but we have to make an ongoing commitment to try and challenge and ensure that the culture of health boards is appropriate. So, whilst I'm grateful for the work that our improvement officers have done, that was pre the legislation, the excellent legislation that this committee gave me last year. That's given my office new powers when it comes to establishing the complaint standards agency. Already, staff there have made great progress despite the pandemic. So, by Christmas we should see 45 training sessions having been held, and I anticipate within the next six months we will have established complaint standards for local authorities in Wales, which is excellent progress. 

Outside of those standards in terms of local authorities, how would you describe any systemic improvements with regard to health board improvement? And, in a sense, how then has that been cascaded as best practice across health boards? What systemically has changed within health boards during this year? 

I do feel that in terms of health board improvement, we're not quite there yet. There are a couple of reasons for me saying that. First of all, we're keen to use our complaint standards powers to work with health boards. We're not quite at that point yet, but we are confident that we can do it within 12 months. And also, it's now six years since the publication of the report from Keith Evans, formerly of Panasonic. He did his report on the gift of complaints. He looked at what was going on in terms of systemic cultural issues within health boards six, seven years ago. Some recommendations there involve the data for 'Putting Things Right', the need for us to have a common approach across the health boards. That still hasn't happened. I'm concerned about that. I intend to write to the health Minister about that, because I think it's a 'once for Wales' proposal now for creating this digital authority for ensuring more open data for the health boards. It hasn't happened over the last six or seven years. Often, I've been very impressed during the period of the pandemic to hear senior health officials tell us that they've been able to do things in five weeks that used to take five years. So, I really hope that, if we could make progress over seven or eight days on something that's taken six or seven years, in terms of the Keith Evans review, that would be the most important systemic—

And very succinctly in regard to that question, what would you like to see in regard to systemic change within health boards that would have that most optimum impact?

Well, I think the culture more generally has to change, but the specific change that we want to see, to be absolutely succinct, is a common Datix system. All the current health boards have different systems. 

Okay. Thank you for that; that was very succinct. In regard to the difference of figures—I'll come to a question around that in terms of complaints—but, in regard to resource implications—and I note very much the figures around community and council complaints, and vexatious and frivolous complaints—what are the implications of frivolous and vexatious complaints to your office in terms of capacity and other points?

Well, I think the implications are that any complaints coming to the office have to be assessed, be they vexatious or not. I'm pleased to report to you that we've seen the overall trend in code complaints come down over the last eight years. We received over 400 around about 2012; it's just over 200 in the most recent full accounting year. That's good news. Anecdotally, staff during the year in question were not telling me of more vexatious complaints about people being defriended on Facebook, or having negative reviews, or clicking their biros in an aggressive manner. We've have a lot less of this, which is obviously good news, so that we can focus on the more serious complaints that we receive, not just in terms of code, but in terms of public services and health as well. And I'm also pleased to report—the issues that will take up most of our resource are those serious ones where we have to investigate, and investigate fully, and obviously, adhere very, very carefully to the principles of natural justice. In terms of serious cases that require referral to either a standards committee or the adjudication panel, they are low. There tend to be five or six per year, and that was happening when they were at 400 coming in, or when the number had reduced to just over 200. I think that's a great reflection on the standards of public life in Wales. 

Thank you for that response. So, there are different figures, as I've alluded to, reported in the annual report and in the corporate governance report for numbers around new complaints. Can you give any explanation or narrative around that? Because, obviously, that's going to be questioned. 

Yes. We've tried to be as precise and consistent as we could be in this annual report. It's the only one that we've done virtually. There were no paper copies, and people were doing this on a virtual co-ordinating basis. But, when it comes to code particularly, we did introduce a new classification of pre-assessment. So, that's a data set that it is different to anything that we've used in the past. But if there is any specific inconsistency there, we'd wish to correct it, and I'm happy to apologise for it. 

So, in regard to that—and that is noted—what more can be done in terms of presenting these statistics accurately? Obviously, the context that we're in is there, and we're aware of that, but in terms of that presentation to the public, and to this committee, it needs to be consistent, doesn't it?

Absolutely. And I'd like to reassure you, and the rest of the committee, that I only have 10 months left, but I'm not demob-happy. Good culture is about learning consistently, so, if there are any issues in terms of feedback where we could be more consistent, or more informative and insightful in terms of the way in which we go about our business and produce our annual report, and indeed, our estimate as well, then I want us to keep on learning until my final day.

Okay.

Thank you, Cadeirydd. A couple of questions. The first one is: are you on target to spend the allocation for the project fund and capital in 2021? I was going to say—I think Rhianon's done that. Can you provide more detail on the carbon strategy and what sustainable indicators are in place from 2021 onwards, and how the next round of investment will be funded for 2021-22?

Well, I would very much hope, Mike, that we're going to have a much better set of indicators when it comes to carbon and global warming if nothing else. For all this homeworking, certainly in terms of my own efficiency, I'm driving 35 miles less a day every time I don't go to the office. I think that's true of another 73 members of staff. So, I think that certainly office-based electricity use would be considerably down as well.

Can I go on to some other issues on that? Can you capture the opportunity and demand from a new cohort of members to work differently and to create a more efficient and environmentally friendly workplace? Members have got used to working from home. Members who aren't in the Senedd have got used to working from home. Some of the people who you're visiting and checking on have got used to working from home. How are you going to ensure that we continue to have people working from home?

Well, it's been a huge culture change, hasn't it? I don't think I'm responsible for our staff working from home—that's been a response to Government guidelines. But, certainly, I'm very proud of what we've achieved. I'm very grateful, particularly to our IT manager, for the fact that we had 74 members of staff linked in electronically almost immediately after lockdown, the fact that we're investing this year in softphone technology and other areas to facilitate. So, for most people, they can work as effectively at home as they can in the office. What we found, obviously, is that we've got to monitor on a weekly basis now how we're performing. This is crisis management, but I'm proud to say, people who were perfectly productive in an office environment are perfectly productive at home. Obviously, there have been some challenges, and some challenges for some individuals when it comes to childcare and other issues, but I think aspects of this are a new normal, and I think there will be a lot more of it moving forward.

I think, for us, going forward, it's going to be, perhaps, a challenge for managers to envision a world where, perhaps, it's less about inputs and more about outputs as well. We need to keep people, perhaps, less worried about how long they're in front of their computer or what their precise number of hours are. How effective are we and are we able to sustain a culture? Surely a culture is something that is created when people come together in an office environment. All that's pretty much gone for the time being, but we do have plans for a safe return when guidelines allow it, and I think that will lead to some kind of rota working.

I think it will as well. A lot of people are working from home or working from their own office or offices near to where they live, and that must be saving money. Are you happy with the amount of money that's being saved?

Well, yes, I think, as an accounting officer, if something is saving public money, which can be invested in other public services, I don't have a problem with that at all. I think I've written to your Chair some months ago in response, in terms of where we found savings and then additional costs. Most of the additional costs were in IT. I don't think there were many others. There were many savings in other areas.

But I think, with this estimate for next year, it would be unfair of me not to point out that there are other savings that aren't just COVID related. One of those is on rent for the next four or five years. When I say it's not COVID related, I'm sure COVID's had an impact on the market, which has had an impact on the negotiation. But that was carried out by Dave Meaden. So, I'd like to thank Dave for his excellent work there.

Okay, that's me done.

Thank you.

Thank you, Chair. We recognise the importance of well-being to, obviously, supporting our staff but also actually to being productive. I think a well and happy and healthy workforce is going to be one that actually provides a good service to the people of Wales. I don't think there's any single measure that will provide well-being for all staff, and I also think it's important to recognise that, actually, different members of staff have, perhaps, different needs and different levels of support that they would welcome.

But we've put quite a lot of things in place. Some of them are just quite simple in terms of regular contact with line managers, and, again, that perhaps reflects the needs of individual members of staff, so for some it's more frequent than others. We've had communications across the organisation; we've managed to have a couple of all-staff meetings; we've tried to keep the team meetings going; we've been very flexible in terms of how people can work their hours and we recognised that particularly over the summer and when schools were closed it was a real challenge for parents juggling childcare, home-schooling and all the rest, so we gave as much flexibility as we could in terms of hours and where and when people could work. We've put a lot of effort into supporting people's ability to work effectively at home in terms of IT, and I think that is about productivity, but I think, to some extent, you can't separate out the feeling that you're doing a good job from well-being; I think the two go together. If you've got the kit to do the job, you feel you're contributing and you're getting things done, that supports well-being. If nothing is working and you can't get things done, it obviously doesn't. So, I think, although they're perhaps for slightly different reasons, they do support well-being.

We've done display screen equipment assessments at home. We've also got a well-being group of staff that's continued to meet virtually and come up with some suggestions for things that people can do to encourage people, for example, to take exercise, go for a walk, walk from John o'Groats to Land's End, that sort of thing—virtually, of course. We've got a counselling service that people can make use of, which is still available. We've got a number of staff who are trained as mental health first aiders and they have divvied up the workforce between them and are making sure that they're keeping in regular contact with their cohorts of staff. We've done a couple of surveys of staff attitudes, partly about coming back to the office at some point in the future when Government guidance allows and partly just to ascertain people's views, and we were really quite pleased at the positive responses that people gave about their own well-being and about the support that we'd provided to them.

Okay. Well, it sounds to me as if you've got that base well and truly covered, so I'm content with that. Diolch yn fawr iawn. Thank you. We'll move on to Nick, then.

Thanks, Chair. I've walked a fair bit during the lockdown, but I don't think I've walked from John o'Groats to Land's End, but I suppose there's still time if there's another wave.

Afternoon, Nick. You note in your annual report that the unit costs for periods prior to 2019-20 have been inflated by CPI, but the figures for previous years are some 20 per cent higher than those set out in your 2018-19 accounts. How have you calculated the uprated figures?

I'd better pass this one to Dave, but I think some of that unit cost issue is relating directly to the additional staff we've employed to work on new powers, own initiative, complaints standards. They're doing a great job, but obviously they're not dealing with individual cases. Dave.

Thank you, Nick. Yes, we decided to change the way we would show the figures this year, so rather than go back to 2010 figures and then reduce the costs this year by deflating them, we thought it was better to show the costs for this financial year, or the 2019-20 financial year, as the actual cost and then adjust the previous years up. So, that's why they look quite different. The end result in terms of the percentage change is exactly the same.

Great, thanks. In your estimate for 2021-22, you set out the areas in which you'll make efficiencies to fund the increase in pay and pensions. Can you say a bit more about this, in particular what staff reorganisation you were thinking of undertaking and whether there'll be any severance deals, for instance?

We have no plans for major staff reorganisations or severance plans. The savings will come from five key areas: very close management of our professional fees, notably our clinical advisers, where we have put new monitoring systems in place. Communications: we don't plan for any seminars, conferences. We produce nearly all documents in-house using our own stuff, so we cut down on outside costs, and most Welsh translation services are in-house.

Travel: partly COVID related, but we're assuming there will still be restrictions in place next year, but we also think, in the longer term, there'll be sustainable savings with the use of meetings like this—Zoom, Teams—and, on a personal basis, I've never quite seen why videoconferencing never took off in the past as much as it has now.

Office costs: we continue to aim for a paperless office. We made a significant investment last year in buying our own printers, so we're avoiding all the annual leasing costs that are associated with leasing printers, so it was a spend-to-save scheme. We've reduced our postage and courier costs and we plan to further use cloud-based document handling and transfer systems to send files to our advisers, rather than sending them documents or CDs or whatever in the post.

And finally, and Nick has already mentioned it, we've made a significant saving on our premises. Next year, we'll save £40,000 to £45,000 on our premises costs by maintaining the rental costs at 2015 levels. Those themselves will fund any additional costs in IT or pay.

I know in the Assembly, the Senedd, we always dreaded videoconferencing committees because it never seemed to work, but it seems to be that reliability has improved massively during the pandemic and it's obviously moved things on.

Finally from me: moving on to pensions, you requested an additional £148,000 in your supplementary budget for 2019-20 to meet the increased employer contribution rates from 1 April 2019 for the civil service pensions. What are the actual costs you incurred?

Yes, it's quite right. We asked for another £148,000. That was calculated on a person-by-person basis, because the banding of the member of staff determined the percentage that we should ask for. We only included staff that were in our staffing complement on 1 April, so it excluded people that we recruited during the year, for example, the new powers staff. So, overall, when I look at the pension costs, our actual pension increase was higher than that, but, if I remove those additional people from those costs—I haven't got the exact figure to the penny, but you'd be very close to that £148,000. I could give you the exact figure; I'd just have to work it out.

No, that's fine. That's a pretty accurate answer, specific answer. Thanks for that. Thanks, Chair.

Thank you, Nick. Alun Davies.

Dave, if you want to tell the good news, I hope, to the committee, in terms of where we are on pensions.

Thank you. Just to confirm that what we were talking about here is the local government pension scheme, which is funded by the Cardiff and Vale pension fund. With these type of schemes, the valuation is carried out by the actuary. We don't actually value the scheme—it's carried out by the actuary—but we, really, account for and disclose the information that that actuary provides. I've actually spoken to the actuary about this over the last few months, and the reason for the increase this year, which was, I must admit, a bit more than I expected, was really twofold: (1) the low risk 100 per cent investment we made in Government bonds provided a growth in the fund that wasn't damaged by any stock market changes that happened at the end of the financial year, and, secondly, and a much larger effect, was demographic factors, which, depressingly for me, showed a reduction in life expectancies for the UK population, and that caused a net effect of a growth in that fund. So, the fund actually grew by £270,000.

Okay. Okay.

Could I add something to this? Members may remember that a couple of years ago we identified that we did have a surplus in the fund and that there were particular rules in these funds that apply to surpluses and deficiencies if the scheme loses its last contributing member—so, in another words, it becomes a closed, orphaned-type scheme. Well, since even the writing of this report, I've got confirmation from the actuary that, following the resignation from the scheme of the last remaining contributing member this year, we are due a significant refund of the surplus that's shown in those accounts. He isn't able to give me the exact amount at the moment, but he estimates it'll be around or probably at least £1 million, probably sorted out by the end of this month, and, when that happens, a refund of £1 million will be given back to the ombudsman. As much as we'd like to keep it, we'll pay it over to the Welsh Government, so it goes back to the people of Wales—the Welsh Government. I have informed Welsh Government officials that this is likely to happen. There's no need for a supplementary, really; the money just comes back to us and we give it back out. And that'll be the last time we will report anything on that fund. 

Chris, are you happy to give a fuller answer to this, please?

Thank you. I think it's worth just pausing to think that, actually, if COVID had happened three years ago, four years ago, we'd have been in a very difficult place, as an organisation, to where we are now. Before the Finance Committee supported our estimates that included investment in IT, we were still very much paper based—all our case files were paper based. We could have a limited amount of working at home, but, when you got to three people, the fourth person kicked off the third person. So, we've come a long way since then, and I think we appreciate the investment that we've been able to make as a result of Finance Committee support.

We've skewed our plan a little bit. I think, broadly, we're ahead of where we thought we would be, not least because our existing telephone arrangements have worked pretty well, but they haven't—. I think we put this in the letter to you, Chair, a little while ago about our plans for the year and expenditure. They've worked very well, except for the fact that they don't allow us to operate the main front-line telephone service in quite the way we used to, so we've been taking messages and phoning people back very promptly. But we are now nearly at the stage where we can restore that telephone service so that it is a full enquiry service provided in real time. So, that has come forward; it was originally going to be in next year's programme, so that's come forward.

We've moved to accelerate our investment on some of the transfer of information and documents that David spoke about earlier, so that we're able to get things to our advisers without the use of couriers carrying physical files. So, we've invested in electronic transfer of files, which has worked really well. We've invested in a better broadband connection—obviously key—and that's supported the cloud back-up, because one of the other things we've talked to the committee about before is our business continuity and our ability to back up data and restore from that back-up.

So, the short answer is that we're ahead of the plan, in many ways, and I think we're well placed now. We've got the cloud back-up running and we have tested the data to make sure that it is, actually, usable. There's still a bit more work to be done and IT investment is ongoing, isn't it? One of the things in the plan is an ongoing replacement of personal computers. But we're well on track in terms of the IT investment and I think it has paid dividends in terms of how we're able to provide a service now. 

I'm happy with that.

Good, diolch yn fawr iawn. Okay, thank you. We'll move on, then, to the final set of questions, from Mark Reckless.

The estimate for 2021-22 shows falling expenditure, I think, in all areas except for staff costs and ICT, and I just wondered to what degree does that reflect the COVID pandemic versus planned longer-term efficiencies.

Thank you, Mr Reckless. I think I've already alluded to the fact—you know, there's a blend there. Clearly, there have been some savings that we've made as a result of COVID, but there are some longer-term efficiencies as well, including rent. There are some huge savings in rent, so I'm very grateful to Dave for that. I don't know if Dave or Chris would like to expand on that.

I think that there are—. It is a mix of the two. The main change in terms of COVID directly is around some of the energy and office costs and some of the travel costs, but, actually, there have been significant changes elsewhere in terms of our use of professional services, professional advice. Also, I think one of the things COVID has shown us is that, for example, with the training that we're providing to public bodies on complaints handling and complaints standards, the intention was that all of that would have been done face to face. COVID has meant that we've been forced to do it a different way. It's relatively early days, but the early feedback is that it's working pretty well, doing it virtually. So, I think there are some areas where it's actually a bit of both; it's change facilitated or prompted by COVID, but it's not because we're doing less because of COVID. So, I think it is a mix.

The reduction in professional fees that you're expecting—are you able to give us a breakdown of that or greater clarity as to how you'll be able to achieve that, do you think?

I think, to some extent, it's efficiencies across the board, but the biggest single saving will be on the cost of clinical advice on our casework. I think David mentioned earlier on we've been working very hard on that, both in terms of supporting and training staff to ask very targeted questions, and also working to make sure that we're much clearer with our advisers as to what our expectations are in terms of the cost. So, if they think it's going to take longer to advise than we anticipate, we're requiring them to tell us that in advance, rather than just wait until the end and say, 'Oh, by the way, it costs this much more.' So, we are being much tighter in how we manage the costs, and that's where the main efficiency will be.

And can I ask David Meaden—? You've mentioned a couple of times how well he's done on the negotiations with the lease, and we'd like to thank him for having mitigated any costs that we had thought were going to increase, I think, by 20 per cent when we spoke about this last year. I just wonder, though, David, could you—. I ask partly to assess and scrutinise the organisation, but also to understand what may be possible elsewhere in the public sector. We had, I think, a projection of 20 per cent rental increase. Do I now understand that you've agreed there won't be any increase at all? So, you've basically frozen it. Have you had any other changes in the lease terms? Do you think freezing is the right sort of objective that others in the public sector should be looking for, or, in the current circumstances, do you think there are prospects of people perhaps trying to reduce rents?

Dave, do you want to start on that one, given your success?

I'm not sure if David Meaden heard me there.

I heard you, I just failed with the technology, after everything we've talked about.

We negotiated an extremely favourable rent back in 2015. I think that was the starting point. This type of lease has a mid-term, in this case a five-year, rent review. Again, based on this type of lease, the only way is up, or keep it the same. In this type of lease, there is no possibility of reducing the rent. You could argue the rental value of the property is zero at the moment if it's not rentable—people are not looking at office accommodation.

Initially, when we came to committee last year, we'd spoken with the landlord, who was looking to increase the rent by 20 per cent because he said that was a fair market rent for Bocam Park in Pencoed and that other people were paying similar or more. However, COVID actually helped us in this—we were able to challenge him and say, 'Can you demonstrate that there is any demand for this property at this point in time?', and he couldn't, and we argued, 'Where do we go from here?', and he agreed to freeze the rent. But there is no option to reduce it. I think if there was, I would have negotiated that. Just to put it into perspective, the saving is £163,000 over the next five years.

There we are, okay, thank you. Mark, are you happy?

I'm good, thank you.

Yes, there we are. Okay, thank you. Well, I think that concludes the questions, unless any other Members have any issues they wish to raise.