Y Pwyllgor Cyfrifon Cyhoeddus - Y Bumed Senedd
Public Accounts Committee - Fifth Senedd08/10/2018
Aelodau'r Pwyllgor a oedd yn bresennol
Committee Members in Attendance
|Jack Sargeant AM|
|Jenny Rathbone AM|
|Mohammad Asghar AM|
|Nick Ramsay AM||Cadeirydd y Pwyllgor|
|Rhianon Passmore AM|
Y rhai eraill a oedd yn bresennol
Others in Attendance
|Ann-Marie Harkin||Swyddfa Archwilio Cymru|
|Wales Audit Office|
|Anthony Barrett||Assistant Auditor General for Wales|
|Archwilydd Cyffredinol Cynorthwyol Cymru|
|David Meaden||Cyfrifydd Ariannol, Swyddfa Ombwdsmon Gwasanaethau Cyhoeddus Cymru|
|Financial Accountant, Office of the Public Services Ombudsman for Wales|
|Katrin Shaw||Cyfarwyddwr Polisi, Cyfreithiol a Llywodraethu, Swyddfa Ombwdsmon Gwasanaethau Cyhoeddus Cymru|
|Director of Policy Legal and Governance, Office of the Public Services Ombudsman for Wales|
|Manon Antoniazzi||Prif Weithredwr a Chlerc Cynulliad Cenedlaethol Cymru|
|Chief Executive and Clerk of the National Assembly for Wales|
|Matthew Mortlock||Swyddfa Archwilio Cymru|
|Wales Audit Office|
|Nia Morgan||Cyfarwyddwr Cyllid, Cynulliad Cenedlaethol Cymru|
|Director of Finance, National Assembly for Wales|
|Nick Bennett||Ombwdsmon Gwasanaethau Cyhoeddus Cymru|
|Public Services Ombudsman for Wales|
|Suzy Davies AM||Comisiynydd y Cynulliad|
Swyddogion y Senedd a oedd yn bresennol
Senedd Officials in Attendance
|Claire Griffiths||Dirprwy Glerc|
|Meriel Singleton||Ail Glerc|
Cofnodir y trafodion yn yr iaith y llefarwyd hwy ynddi yn y pwyllgor. Yn ogystal, cynhwysir trawsgrifiad o’r cyfieithu ar y pryd. Lle mae cyfranwyr wedi darparu cywiriadau i’w tystiolaeth, nodir y rheini yn y trawsgrifiad.
The proceedings are reported in the language in which they were spoken in the committee. In addition, a transcription of the simultaneous interpretation is included. Where contributors have supplied corrections to their evidence, these are noted in the transcript.
Dechreuodd y cyfarfod am 13:17.
The meeting began at 13:17.
Welcome to this afternoon's meeting of the Public Accounts Committee. Headsets are available as usual for translation and sound application. Please turn off any phones and, in an emergency, follow the ushers. We've received an apology today from Adam Price and also Neil Hamilton. Jenny Rathbone will be joining us during the course of today's meeting.
Do any Members have any declarations of interest they'd like to make? No. Okay.
Item 2, papers to note. First of all, the minutes from the last meeting, 1 October. Okay, the minutes are accepted.
Secondly, the Welsh Government's funding of Kancoat. The Welsh Government have provided an update on the implementation of recommendation 11 from the committee's report, February 2017, regarding the outcome of any negotiations for the former Alcoa site in Swansea and the impact on the final sum lost as a result of the Kancoat investment, including the cost of any remediation works. Are Members happy to note that letter?
Next, the scrutiny of accounts. I've received an interim response from the National Library of Wales, advising that the workforce development strategy is scheduled for discussion by the board of trustees in November. Assistant auditor general, did you have any comments on that?
No, no comments on that at all.
We just need to note that letter. I'm due to receive a final copy of the workforce development strategy by the end of the year, so we'll follow that up then.
The Welsh Government have also provided an update on the implementation of the recommendations in the committee's report on the inquiry into regulatory oversight of housing associations. We need to note that letter. I'll seek a final update in 2019, once the remedial actions outlined have been completed.
Bethan Sayed, the Chair of the Culture, Welsh Language and Communications Committee, has written to me with her committee's views on the issue of the Welsh Government's relationship with Pinewood following the evidence received during its inquiry into film and major television production. Pinewood were not able to attend a meeting before the summer recess, and the committee wrote to them with a number of questions. The committee also received a private briefing from Wales Audit Office officials on 28 June, which was attended by Lee Waters as a then member of the Public Accounts Committee. Adam Price attended the committee meeting on 12 July and questioned the Ministers and officials. Any comments on that?
No, only to say that, obviously, with changes in PAC membership, it might be worth just briefing Members before the 5 November meeting.
That's a good idea; we've had quite a few changes to committees overall.
Just to provide an update on the facts in the report we provided and, indeed, PAC's own consideration.
As new members will discover, we have lots of information coming through this committee at any one point, so, looking many ways at once. I suggest we take evidence from Pinewood, then, and the Welsh Government before the end of the term, as Anthony suggested. We'll brief Members on that.
Item 3, and the Welsh Government have responded to the recommendations contained within the committee's report on housing adaptations—a report that was published in July 2018. They've accepted, I'm pleased to say, all six recommendations. If members are in agreement, I'm happy to write to the Welsh Government thanking them for their positive response and suggest we request an update on the implementation of the recommendations when they've had some time to bed in in the spring term.
Item 4—the committee undertook an inquiry into public procurement in Wales. We took evidence from a wide range of witnesses during the spring of 2018. During the evidence session with the Welsh Government, it transpired that a number of the committee's concerns would be addressed in the review being undertaken by the Welsh Government, which was to report in September. I therefore wrote to the Welsh Government, advising it would be premature for the committee to draw conclusions prior to their review being published. The Cabinet Secretary has written to me with the review's conclusions. Anthony.
I think, obviously, the work has resulted in some consensus around changes that need to be made. I think significant work will be required to implement those changes. I think it's worth, perhaps, the committee taking further evidence from Welsh Government later this term to explore the outcome of the review and how any changes are being taken forward.
Good. Any comments on that, or on the response? We can hold an evidence session with the Welsh Government in November to discuss the findings of the review in detail, together with the plans to transition the service into a new business model. That should give time for us to see how things are working out on the ground. Happy with that approach? Good. Okay.
Item 5, which is not due to start for a while. Okay. We are ahead of time, so shall we go into private session until—? We'll have a quick break until our witnesses are ready to come in.
Gohiriwyd y cyfarfod rhwng 13:22 ac 13:38.
The meeting adjourned between 13:22 and 13:38.
Welcome back. Item 5 is the scrutiny of the annual report and accounts of the Assembly Commission. I welcome our witnesses. Thanks for being with the Public Accounts Committee today. Would you like to give your names and positions for the Record of Proceedings?
Yes. Suzy Davies, Assembly Commissioner.
Manon Antoniazzi, clerk and chief executive.
Nia Morgan, director of finance.
I've seen you in Finance Committee, so now you've got me at the other end of the process, as well. Great, welcome. Thanks for being with us.
I'll kick off with the first question. You came within £389,000 or 0.7 per cent of spending your resource outturn budget—that's excluding Members' pensions costs—against your target of 0.5 per cent. Did you need to take any action to make sure that you came in on target?
I haven't brought my annual report with me, I'm sorry, but I seem to remember that the figure was a bit nearer 0.6 per cent. But that gives you an idea of the small amounts that we're talking about. Using resources wisely is one of our strategic goals, as you all know. It's very closely monitored. We look through forward work programmes, and value for money is very much at the heart of what we do anyway, and we planned for a buffer zone, if you like, of £200,000 or so, and we weren't very far from that. I suppose I've got a question for the Public Accounts Committee, actually, about whether you think this is a useful key performance indicator or not, because we are going to be reviewing our KPIs soon, so it would be quite helpful to get feedback on whether you think it has any point to it, particularly as our budgets are going to look very different from now on.
I was going to ask you: we hear a lot about this figure of 0.5 per cent and whether you're coming in on target, which you have this time—or near target. What would happen if you weren't coming in on target? What sort of processes would kick in at that point?
Well, from now on, of course, it's slightly less of an issue because the Welsh Government, or the Welsh block—that can be rolled over from year to year. So, anything that doesn't get spent can go back into that and doesn't get lost as such. But, if you want to know a little bit about the processes, I'm more than happy to pass you on.
I think there would be consequences for me as an accounting officer if we went over our budget, and the imperative to not go over our budget at all is obviously a very strong thing that drives us. But we manage the finances very closely. We monitor and report on the budget on a monthly basis, and therefore we try, through that means, to minimise any under-utilisation. However, from next year onwards we will be committing to return any unspent parts of the determination, or rather not drawing down any parts of the determination that we don't need. So, this becomes a less useful KPI from then on.
What happened this year was that we had allowed, as Suzy said, a bit of a buffer because the previous year we'd had some late claims in, and obviously we have to make forecasts about likely accruals. The estimates turned out to be a bit too high this year, and so we just crept over that 0.5. But we're still well within the 1 per cent target that the Commission has had for a lot of its life.
How will any changes to how you budget for Commission and remuneration board determination impact on the transparency for how accounts are presented next year?
Well, as I mentioned, it may lead us to revisit that 0.5 per cent KPI, as to whether that's useful or not. Otherwise, I am pleased that the annual report this year is a pretty transparent document. It's laid out as clearly as we can make it. We've built on use of infographics, which was commented on favourably last year. We will continue to do that next year, and we will continue to make it clear how anything that is forecast when we bring information to you and Finance Committee ends up being spent.
I think you're likely to see them looking a little bit different anyway, because members of Finance Committee who are also on this committee will see that the way the budget is presented is different. So, the way—the accounts following on from that budget will also look a little bit different. But my understanding is that they're drawn up in accordance with Treasury standards, is it? I can't remember what it's called now.
The famous FReM. Is that right?
I don't know if Nia wants to explain a bit more about what that is.
We'd welcome any comments that you have to make to make the accounts more transparent. I know the Wales Audit Office carried out their own exercise looking at the accounts of a number of public sector organisations and we came out favourably in that, commended on our use of infographics. So, we've tried to maintain that level of transparency, but we would welcome any comments that you have.
I was going to ask you about the well-being of future generations legislation. It doesn't specifically—. Sorry, I'm not going to ask you specifically about that, but you're not listed, the Commission isn't listed, within that. But, as part of the overall whole, do you pay attention to that legislation, and, in terms of the Treasury guidelines, it doesn't exist in Westminster, does it? It's our own legislation, so I imagine those Treasury guidelines wouldn't actually take account of future generations either. So, how do you balance those two, if you do?
That's a really interesting question. I suppose what I would say as a first response to that, of course, is that it's the Welsh Government and Assembly Members who carry out their work in accordance with those principles now, and of course the goal of the Commission, one of the strategic goals of the Commission, is to provide the best possible parliamentary support. So, there's obviously a bleed through to what we would do as a Commission anyway. But there are certain things that you'll recognise anyway within the Commission's report; for example, the commitment to equality, the commitment to Welsh language. I seem to remember one of the well-being goals was about growth of the Welsh language and supporting communities that are cohesive, and you see those reflected in the annual report pretty strongly, I would have thought. The work that we're just starting to do—well, it's not just starting, but we're actually starting to see results on now with making sure that we have greater reach to the black, Asian, and minority ethnic communities as members of staff. That fits in pretty well, I would say, with the well-being goals. And, of course, using resources wisely—if we're looking for a prosperous Wales, we don't want to be wasting money, so—.
It strikes me, certainly from a Finance Committee's point of view, that we often get the answer, 'We've done it to Treasury guidelines'—or the Westminster, the civil service, standards. And, of course, when the Assembly was established, there wasn't much divergence. So, it's a broader question, really, but I think, over time, probably referring to that gold standard isn't necessarily going to be the gold standard in Wales.
Well, I don't know—. They're not mutually exclusive, are they? I wouldn't say that they are. I mean, those few things that I've mentioned to you now, which I hope you all recognise as Members, that doesn't mean that we're not following guidelines, but we're achieving these goals as well.
I think that the instruction in the Government of Wales Act to have regard to the principles of equality of opportunity and sustainability run in parallel to the provisions of the Act, and the way that we work as a Commission, the instructions that we receive from the Commissioners, are very much in the spirit of the Act, but you make good point that it doesn't apply to us directly. I mean, it's—
Yes, I mean, you don't have to—
No. We keep in close touch with the Commissioner.
Okay. Mohammad Asghar.
Thank you very much, Chair. Good afternoon, ladies. Just looking through all these budgets that you're covering—and it's wonderful to see some of the points in this report here and your forward planning—my question is, suggesting—. I'll just relate to the employment and some of the capacity—what you're saying—and priorities and capabilities and understanding that you are putting in your report annually. What have the key outputs and changes been since the capacity review was announced last September? Has the capacity review identified areas that are over-resourced, please?
If I may take that one, the short answer to the second half of your question is that we haven't identified any huge areas of over resource, but we have identified a series of valuable economies that we're able to make. The process of the capacity review has been a pretty comprehensive one. It has occupied most of the reporting period that we're talking about here. We came up with an initial report at Christmas of last year, which, I believe, was sent to this committee. We then had a working group tease out more detailed conclusions, and that reported in the summer. We have an action plan now that we're working through, a programme of service review and change, which is being overseen by our new executive board, and we have also used the knowledge and the expertise that our staff has contributed to this process to make some policy changes that have enabled us to respond in a more flexible way to emerging demands—notably, of course, Brexit and Assembly reform—where we have had to move staff resource from areas where it could be spared to this more urgent need, and that's worked out quite well in terms of freeing posts and enabling us to stay within our establishment post cap of 491, which we committed to do in discussion with the Finance Committee last year. Our leadership team has done some fantastic scenario planning, which has helped feed into service review, and we've done a lot of work engaging with the Commission, with the Chairs' forum, with the Business Committee, to understand user needs and use that information to update the Commission's priorities in more detail.
Thank you very much. You've given me quite a few answers to my questions already. Are you considering restructuring the organisation?
Well, we have taken advantage of some senior staff moves to pause and reflect. We are about to advertise for a third director, but our director left us nearly six months ago now, and the interim arrangements that we put in place have enabled us to explore new models and, as a result of that, although we are going ahead with the recruitment of a third director, we have redistributed line management responsibilities between the three directors that we have to reflect more accurately the Commission's three goals of providing excellent parliamentary services, of engaging with the people of Wales, and of using resources wisely. And so that has been a shift, if you like. That has been a bit of a restructure. Beyond that, as we look at different services and review their operation, there will be a certain amount of restructure, probably, but that would come under the category of business as usual. Our staff are all flat out at the moment, and so we're concentrating on making sure that the resource is where we need it, rather than restructuring for restructuring's sake.
So, you've just said that there's one director at the moment less and that an interim director is there. Is that what you're saying, that there's an interim director, or there's—?
We haven't appointed an interim director. What we've done is divided up the duties of the departing director and given certain other colleagues a chance to step up and assume more responsibility for a short-term period.
Okay, thank you. And how are you using the departure of staff to reduce and refocus senior management posts?
I've probably answered that question.
You were overdiligent there, Oscar, I think.
That's fine. And what are the driving forces behind the increase in the median salary, please?
The increase in median salary. Can I actually refer that one to Nia?
So, the median salary, as you know, isn't the average salary of all our staff; it's the salary of the person in the middle of a long list of all of our staff, and this has moved to a higher point on our grading structure during the last financial year. At the end of the year last year—so, 2017—we had four apprentices in place, being paid right at the bottom of the salaries for the range of employees that we have. So, at the end of the year, 31 March 2018, we no longer had four apprentices in place. We've gone through a recruitment exercise and they're in place now, but they weren't there at the end of March. So, the four people at the bottom have dropped off and this sort of pushed up the middle person a bit further. So, it's not a reflection on salaries; it's just the number of people that we have and where they are placed on the grades.
Okay. And how are you redeploying staff resources to meet new priorities, please?
I touched on this a little when I was describing the capacity review. What we've done is we had an expressions of interest exercise where we worked out, through small economies and through looking at our processes, where we had small amounts of spare capacity and enabled people to volunteer, then, to help out on the Assembly reform and Brexit work, which has been incredibly valuable. And it all helps sponsor a one-team ethos, that we're all working together. And there's a tremendous amount of expertise and talent in all the directorates of the Commission team, and this enables us to be involved with the big projects in different ways.
Okay. Thank you. And what has the Commission spent on consultants and external advice in 2017-18, and how are you ensuring that these costs do not increase as you seek to contain staffing numbers, please?
Nia will supply me with a figure, I'm sure, in a minute.
So, on consultancy, we've spent around £100,000, and, in addition to that, we pay expenses for expert advisers on a consultancy basis, and expenses for witnesses and advisers to committees as well, and that comes to less than £50,000. So, in total, around £150,000.
And how will you prioritise and target any potential voluntary exit scheme, please?
Well, we mentioned to the Finance Committee last week that we're considering a voluntary exit scheme. We haven't decided that yet, but, if we do go ahead with it, and if it is affordable within our budget, then it will be a method of refreshing skills. Because we've committed not to increase the staff establishment number for now, then we do have to find the new skills to meet the new demands in this way. So, if it goes ahead, it'll be closely targeted on that basis.
Thank you. Now, I'm just changing a little bit on the other side of the staff—
Just before you go on, Oscar, Rhianon, did you have a supplementary?
It was in reference purely to your comment around the apprenticeships. Have you actually replenished that pool of apprenticeships at the bottom?
Yes, we have.
And that's not affected the median salary, because the others have still moved up, I presume.
Well, it may do when you question us next year, but as of the end of March we—
I can understand that. Okay, thank you.
Thank you, Chair. Are there any issues with staff composition by gender, ethnicity, staff retention and changing nature of skills?
We published our diversity and inclusion annual report for 2017-18, so there's quite a lot of detail in that. I think it highlights in many ways the success of our inclusive policies, and I'm delighted, for example, that the Assembly was named as Stonewall's No. 1 employer across the UK as an employer of LGBT people.
No. 1 across the UK.
What the diversity and inclusion report shows is that we are continuing to attract and recruit a diverse range of people in terms of age, in terms of disability, in terms of religion, sexual orientation and about an equal number of men and women as well. I think we can do better in terms of BME representation, particularly in order to better reflect the diversity of the communities we serve. We have been particularly focused on that during the last year.
Rhianon mentioned the apprenticeships just now. We made a great effort specifically to recruit apprentices from BME communities, and in fact we had three times as many applicants from BME communities apply for those places as we've had in the last three recruitments of apprentices altogether. So, we hope that in that way we can be starting to build a pipeline that will enable us to succession plan and move people through the organisation.
You've probably already gone there. In terms of the grade 3 level of black and ethnic minority workforce that we do have, in regard to that progression, would that succession programme that you've mentioned be specifically aimed at progression for that cohort?
We are certainly focusing on that as a priority. We have established a mentoring scheme, we have a network for people from black and minority ethnic backgrounds within the staff team, and as you suggest and was implicit in your question, we're very conscious of the fact that the BME staff we have at the moment tend to be in more junior roles and that is a concern as well. So, once we've got them in, we want to work hard to retain them and progress them through the organisation and get some visible role models.
So, you're satisfied that what you now have in place will be sufficient.
We're certainly focused on it and we're doing what we can.
Okay, thank you.
We should mention Chwarae Teg as well, because that might—
Yes, we're working with Chwarae Teg in terms of gender equality. Although, where we are on that is better than it is on BME representation.
Thank you, Chair. Thank you very much for this Chwarae Teg and all the rest of it, but I think if ethnic minorities are not reaching you, what actually are you doing, apart from the one or two organisations in place, to reach them? Because they're all scattered across south-east Wales. There is a huge number of black and ethnic minorities and diversity in certain areas. I know you're doing a wonderful job, but still the message is not going across. So, what is the plan there?
In terms of engaging with black and minority ethnic potential recruits specifically, we have looked at our recruitment policies and we have a working group internally and we take external advice as well from expert organisations to try and minimise any barriers. We have been going out into schools, we have been aiming to use people who are black and minority ethnic staff as ambassadors, as it were, featuring them in recruitment ads and so on, so that there is a bit more visibility and people don't automatically feel that the Assembly isn't for them. But, this is very much a work in progress and I wouldn't claim to have solved the problem in the last year.
Okay, thank you very much. How does this fit with the review of recruitment practices to ensure that they are inclusive?
I think the reviews that we've been undertaking are very much in order to ensure that they're inclusive. We have been adhering to civil service guidelines in doing that, insofar as we feel that they're relevant to us. And that, obviously, has given us a number of recommendations, such as those housekeeping improvements that I've just mentioned, which we're taking forward now.
Thank you. What action are you taking to support whistleblowing and tackling potential inappropriate behaviour in your organisation, please?
The whistleblowing policy is supervised by ACARAC, our audit and risk committee and Suzy's on that. I don't know, Suzy, whether you want to say anything.
Yes, just to let you know that whistleblowing is always on that—it's a regular agenda item and it's on the forward work programme. We look at this pretty often.
I'm kind of curious to know, are you talking about whistleblowing in terms of fraud or the wider dignity and respect agenda?
Anything, yes. Anything within the organisation. If there is any whistleblowing, what protection do those people have?
It's all there on the intranet if anybody wants to actually see what the whistleblowing policy is about. You'll be very aware that the dignity and respect agenda is very much at the forefront of what we're talking about at the moment. And to a certain extent, that's a work in progress as well, isn't it? We have different avenues for different members of staff about how they can get the support they need there. There's been some training on this, hasn't there? We've all had the dignity and respect training, but there has been some specifically on whistleblowing, I think, as well. [Interruption.]
I think it's a ship. I think a ship is leaving port.
That's whistleblowing. [Laughter.]
Anyway, my final—
We have consulted leading charities in the area, such as the whistleblowing project, to give training to our staff. As Suzy mentioned, there are instructions on the intranet, which reference our policy on whistleblowing, and there is an e-mail address that people can write to, and there are other channels available for staff according to how they prefer to raise any kind of grievance or complaint, and according to the nature of it.
And my final question—
Oscar, just before you go on—Rhianon.
If I may ask just a little bit more around the staff absence issue, which is, obviously, of concern. You mentioned in the document that we are doing a lot more around mental health, and that's excellent. So, do we, therefore, feel that that's purely down to that data, or is there a wider issue of bigger significance underneath all of that?
In terms of absence, again, I was asked about this at the Finance Committee last week. Our absence figures have rather overshot our target, as you'll see in the annual report for the last year. In an organisation the size of ours, a relatively small amount of absences can make a big difference and that's certainly borne out. In fact I was asking, just last week, human resources colleagues about the rolling 12-month absence, and my notes tell me that that is now down to 3.44, having been 3.8 in this annual report. So, the figure is now down below where it was the previous year, and I would point out that that's actually now below the public sector average figure as well. Nevertheless, it's always something that we try to minimise.
We are aware that it's been at a turbulent year; we've had a lot of change. We have also been trying to keep within this establishment post cap and so there have been a lot of additional responsibilities and work for the staff that we have within the Commission. I think it would be naive to think that that doesn't have a knock-on effect in terms of stress and mental health.
We have been very conscious of wanting to put measures in place to cope with that, so that our staff have somewhere to turn if they feel under pressure. We've been supporting the Time to Change Wales campaign and we will be marking Mental Health Day this month with activities, as we did last year. We've established a network to support people who wish to talk about their mental health.
Time to Change Wales were very pleased with their interaction with the Commission—
Great. I'm delighted to hear that.
I've had a fair amount to do with them. Very good organisation.
Great. Well, we've been glad to work with them as well. And we've got a raft of training to promote awareness of these issues amongst managers as well. So, although we're not pleased that people are suffering from stress and mental ill health, we are pleased that people are more able to correctly identify what they're suffering from, so it enables us to put these measures in place to tackle it. But, obviously, it is a worry, and we will continue to keep a close eye.
So, to answer the question, in terms of differentiation, you would put that increase down to better procedures being in place and better access, or is there not that differentiation between sickness?
The spike was down to something else, wasn't it?
It's obviously gone down now.
It has gone down. When we looked at last year, there was a spike in August of last year, which is why, more than 12 months since then, the rates have gone down again. There were just a couple of long-term absence cases that came together at the same time. We looked at the figures and there was an unusually high number of hospital and medical procedures. Now, there's no reason why that should all come together, other than our staff probably take time to catch up with things during the recess, but it didn't happen in August this year.
Oscar, just before you come in, Jack Sargeant, did you have a question?
Yes, thanks, Chair. Firstly, I'd like to say thanks to Manon and the Commission. In the annual report, there was a great touching tribute to dad and, actually, I'm wearing the same tie, which I didn't plan. [Laughter.] So, firstly, thank you for that. You've already answered my question. It was around Mental Health Day, which is Wednesday this week, and my question was surrounding whether the Commission is going to do anything to promote that, but it's clear from what you answered. Thanks, Chair.
Oscar, I think the thunder has been taken well and truly out of your last question, but if there's anything you want to ask.
Just a final question. Thank you very much indeed, Chair. How are you managing the increasing staff performance in your organisation?
I'm sorry—the increase in staff performance?
How are you managing and monitoring the staff performance in the organisation?
Performance. Well, performance—
I think this ties in with the absence rates, doesn't it?
Yes. But in terms of performance management, we have been looking at our annual regime of performance management. At the moment, everybody has two performance management reviews a year. We're just in the middle of doing one round of them now, and then there's another round towards the end of the financial year when our colleagues are encouraged to look forward and we set objectives at every level for the coming year. We have undertaken a review of best practice and benchmarking in that area now, and we've changed the form— something simple like changing a form does save a lot of time. And so, we are looking again at that, and we're probably moving towards a regime where the mid-year performance review is a bit more light touch. But, by and large, we find that the system, as many other organisations find, gives us an assurance that line management is being carried out properly and rigorously, and that people have a line of sight between their personal objectives and the high-level priorities of the organisation.
Thank you very much.
Great. Rhianon Passmore.
Thank you. In regard to procurement, can you outline how the new corporate key performance indicator in regard to supplier spend across Wales in terms of social procurement is going to be enforced?
Well, perhaps I can just say, because this has been an issue for Members for a while now, not just in relation to the Commission as well, and perhaps the adherence to frameworks—. We're reaching a stage now where, actually, adherence to the frameworks has turned out to be a bit of a problem for trying to get Welsh suppliers involved. So, there is going to be a new KPI, as you say. We're going to try and get 43 per cent of our suppliers from Wales, but also making sure that our longer term suppliers' supply chains involve a lot of Welsh suppliers as well, because not everybody can be from Wales, obviously.
So, the strategy will be for increasing these contract opportunities by encouraging, obviously—as we've talked about many times, I'm sure—the breakdown of the ability to apply for contracts, so that we're talking about collaborative applications to apply for contracts, or consortia, I suppose. But we also have to bear in mind value for money as well, so actually opening up the process to as many small suppliers as possible can still only take you so far. There will come a point where it still has to be value for money, but by encouraging more Welsh people, or Welsh businesses, to apply in the first place, it increases their chance of getting through the value for money barrier.
Okay. I mean, it is a key performance indicator, so in terms of if that's not met, is there going to be any—
Well, let's give it a chance first. We're changing it to 43 per cent, which is better. We just need a chance now to see if the plans that we've got for allowing the broken-down versions of contracts, to see whether that works. Obviously, if we run into problems, we will look at the process again, but it's very much a benevolent attempt to try and get more Welsh businesses to compete for business here.
So, can you just outline for me how that will encourage that precise 43 per cent?
I can't help you on this one just at the moment, because I'm getting the full details next month in our next Commission meeting.
Okay, fine. Well, perhaps when we come back to—. That would be very useful and, obviously, very valuable for us—
There will definitely be less emphasis on the frameworks, because that's not helped Welsh businesses compete.
Okay, I accept that. We've mentioned the 0.5 per cent savings data earlier. Do you feel that that overall savings target is actually quite low, considering the actual expenditure of the budget—or not?
Well, the savings target is largely dictated by the contracts we have coming up in any given year, and, therefore, the scope for savings that we make. But can I ask Nia to come in on this, because you control this closely?
As you know, one of our strategic objectives is using resources wisely, so this is a particularly key KPI. For many years, it was set at around £500,000, but in more recent years—so, last year and the current year—we've reduced it down to £100,000 because of the nature of the contracts that we've got coming up, and a number of them have been through one cycle already, so they're coming up for the second renewal and fewer opportunities to make those savings. So, it's a realistic target. If we set it at £500,000, knowing the types of contracts coming up for renewal, we couldn't possibly achieve it. So, it's a realistic target—something to ensure we've still got focus on value for money and on the types of contracts coming up for renewal. So, we still want it as a target, but realistic, knowing that things are becoming more expensive. But it's always a focus for us.
So, you're reassured that that is an appropriate level, realistically.
We have a procurement update to the executive board on a quarterly basis, and a procurement update—. As Suzy mentioned, there's a paper coming to the Commission next month, so it's of particular focus for the Commission.
I mean, because it is £138,000 that I hear is the amount, anyway.
Yes, as reported in the annual report. It was £138,000 last year. We've achieved £38,000 in this current year with the renewal of the Senedd Wi-Fi, and we've also made £83,000 of post-contract negotiation savings, where we negotiated down the price of the winning tender, so we're also looking at making savings in that way, as well.
Okay, thank you. You've mentioned the roll-over for future budgets. Can you outline how the savings are going to be evidenced? Are those savings going to be recurrent, and will they, therefore, by their very nature, benefit future budgets?
When we look at the savings that we have in a particular year—that £138,000 I mentioned earlier—it's of all of the future savings on that contract. So, we pull them back into this year rather than duplicating the same saving year on year. So, we look at the contracts negotiated in the same year. So, we start from a zero base now for the next year. We obviously make benefit of past savings—for example, the ICT contract. I don't know if you're familiar with that one, where our ICT contract was outsourced and we brought it in-house, and we're still seeing significant savings from that. We don't recognise it as part of the KPI, but we are still benefiting from those savings.
Okay, thank you. I've already touched upon this, and you did highlight the fact that we have to balance that best value for spend, in terms of that new corporate KPI. So, how will you actually balance that, increasing that supplier base for Welsh companies, whilst also addressing the need for best value?
Well, you want to be clear about what it is that your contract is for, and if it's capable of being broken down into smaller bits so that more small businesses can apply for it. That's how you start doing it, isn't it? As I mentioned before, we're going to get the full paper on this in November, so we're happy to update you with the answers on that afterwards, if you like, but I think that I've answered the question as best I could.
Once the tender evaluation begins, the focus is then on the value for money and the quality. So, from that point on, that is the focus of the way that we decide which company to procure from.
Okay, thank you.
Thanks, Chair. I'd like to move on now to developments in the IT department and the world of digitalisation, which are increasingly coming at a rapid pace. How are you developing the new website scheduled for 2020-21, and, in the shorter term, increasing cyber security, which is becoming a clear risk to us all, really?
Absolutely. Well, the digital news and information taskforce, whose report was published last year, gave us a lot of valuable recommendations, and, amongst those, was a focus that we were very aware of ourselves on the need for a new website. We are, as an executive board, considering business cases currently for the new website, and we have asked the Finance Committee for—. We've put in the laid budget a line, which is £275,000, for a new website. So, if the Assembly approves that, we will be moving ahead to redesign and, indeed, renew some of the processes that lie underneath the website. So, we feel that's an important tool for us to engage with the public in future, and we've been engaging with users already to feed those needs into the spec for the new website. There's a project group internally that's looking at it, and that includes, of course, our staff, the Assembly Members, the support staff for the Assembly Members and the wider public.
In terms of cyber security, it's a huge concern, and I remember talking about it when I was in front of this committee last year. It's an issue that doesn't go away, because the bar is continually being raised, and we have to maintain our focus on this issue and our investment in the issue to stay ahead of the game. I'm happy to report that there haven't been any major breaches to date, but we do review our response plan regularly. We've upgraded our software to be proof against the latest types of attack. We've delivered awareness training to staff as well; that's very important, because, as we all know, the weakest link in the chain is quite often human error. So, we want to make people aware of the different ways in which systems can be hacked. Therefore, we have devised a number of exercises that simulate attacks just to make sure that we have a good response primed and ready to go.
Thank you for that. I think it's good to note your performance against the KPIs currently is rather good, and many of them are exceeded and some slightly just haven't been met. Do you think that the KPIs in this sector are challenging enough? For example, your social media ones just increase year on year, and I'm assuming we're expecting that to continue, whereas your web traffic—and it's great that we're revamping the website—but that's sort of static, along with physical tours and visits. Do you think that they are challenging enough, or do they need to be reassessed and changed slightly?
I think that's a very fair point. We are, in fact, reviewing the KPIs, because some of the existing ones are not useful any more. I think, sometimes, as we increase our engagement, looking at different types of engagement over the website may not be truly indicative of how effectively we're engaging with people. So, we need to keep that under review. We also need to make sure that, as you say, they're testing enough, because merely replicating the previous year's KPI may not, in every case, be appropriate; we may need to give ourselves a rather more testing goal. So, there will be some changes. One of the first, to go back to the question that Suzy raised at the outset, is we may not feel, if you agree, that the 0.5 per cent target is actually a very useful one for next year, particularly because we're going to be looking to not draw down some of the budget, anyway, if it remains unspent at the end of the year.
It may be helpful to add as well, because I'm on the audit and risk committee, that the KPIs are something that we look at all the time to make sure that they inform our understanding of the risk to the organisation and what we're able to do. I think it was probably about two years ago that it was reviewed last, so we do look at the KPIs and whether they're valuable on a cycle, and a fairly regular cycle as well. So, they're kind of due for a review anyway now.
Thank you for that. Just finally, how are you responding to the falling satisfaction from Assembly Members with the overall effectiveness of the Commission in terms of engaging with the people of Wales? Now, obviously, we've got a lot of events coming up—the Welsh Youth Parliament, the twentieth anniversary and so on—but we have seen, I think, at times, certainly over the last year, that the Assembly's been through a difficult time, many difficult times, post November. So, this is a chance to spread the new message—a kinder place and so on. So, I just want to know whether there are any events lined up and what's going on, really. What are you doing to re-boost and engage with the people who, potentially, aren't engaged in politics at the moment?
If I can put my AM hat on for a minute, I think it's a frustration that we all share that, after 20 years of having devolution, there is still a lack of understanding out amongst the Welsh public about what this place is responsible for—the difference between the Assembly and Welsh Government. Hopefully, renaming the place will be a step towards dealing with that. I think the drop in satisfaction was pretty small, but that doesn't mean that we can ignore it, because the value of getting people in Wales to understand what's going on is so critical, and particularly when we have a UK media that doesn't really pay much attention to this place, and doesn't help people in Wales, who read or watch that media, understand what's happening in Wales. Then, obviously, we have to up our game here to make sure that people in Wales understand what's going on.
Obviously, you mentioned the Youth Parliament, which I think is a big step forward, because, particularly if there are going to be votes for 16 and 17-year-olds, this is a time to try and mainstream this understanding of what the Assembly's for and what devolution is for at that early age, and, hopefully, people will grow up understanding it a little bit better.
But I mention it's 20 years—now is an excellent time to do a big bang of information. We were talking about a festival of democracy. The fact that it is 20 years old is just a hook to hang on a whole new strategy—well, not strategy, but plan for how we engage with everybody in Wales, not just young people. I've given you the edited highlights, if you like, there, but there's quite a lot more that's going on, and that does bleed through to things like the website and social media. Every step we take, we've got this in mind. Engaging with the people of Wales is one of our strategic goals, and if I can give you some reassurance that the Commission is quite heavy on the Commission staff on this particular one, it comes up all the time about how we can all do better, really, because we as AMs ourselves have to take some responsibility for making sure our constituents understand what we're for.
If I can add—
Yes, please fill in with the details.
Insofar as I can. The new director of engagement that we have will bring together the public-facing service teams, including press and communications, and there have been some new appointments within the communications team recently to strengthen our outward face. That picks up on more than one of the recommendations of the digital news and information taskforce.
We're very excited about the prospect of noting the events that you mentioned, which will be happening in the next year. I'm very happy to be able to tell you today that we've had 480 nominations from people who wish to be youth parliamentarians, which is tremendous, and the communications team feel that they're on track for the target of having 10,000 young people register to take part in the elections, which is great. We're hoping to, as Suzy said, normalise political engagement for this age group in a way that has a positive impact on voter turnout in the future. One very interesting thing we'll be discussing is how the Youth Parliament engages with the Assembly, and that is something we'll be taking our lead from the young people on. But there will also be other things. We will be marking the twentieth anniversary of the Assembly from the first week in May through to the end of May, when the Urdd Eisteddfod will be in Cardiff Bay, as the National Eisteddfod was this year, and we will be reflecting on and learning lessons from that. Then we have plans to deliver a festival of democracy, as Suzy mentioned, in September, so, we hope that we will be able to engage with lots of people through that.
Yes, thank you for that. I think it's brilliant, what we're doing on this, and I think the late Rhodri Morgan and dad himself would be very proud of what we're doing in that area. And, Suzy, you're absolutely right, we all do, as AMs, have an obligation to engage with more people, and a different diversity of people—
It's worth pointing out, as well, which I didn't mention—of course, we've still got Senedd@, where we have mini-tours by Assembly Members and some officials.
Okay. Rhianon Passmore.
Thank you. Can you clarify in regard to the uplifts for the Auditor General for Wales and the Public Services Ombudsman for Wales, and just clarify the issues around some of the incremental uplifts for me, because I'm not quite clear as to what's occurred there? Is there anything systemic occurring, or is it just an anomaly?
It's just an anomaly, but I think I'm going to pass that one over.
Yes. After the problems that were uncovered with the appointment of the auditor general, we were very determined to look very thoroughly into the background of all of this, and we did discover that some uplifts that should have applied had not been applied in-year last year. However, the corrections were applied in time. The issue concerns the fact that the office holder's pay was pegged to scales that had changed, and they're not controlled here. This came to light, but we worked very closely with the Wales Audit Office to rectify where accruals needed to be made after the year end. Nia, do you want to add anything?
The two salaries that were identified during the course of the audit were the Auditor General for Wales's and the ombudsman's. And, in the case of the Auditor General for Wales, at the general point that we recognise that there's an uplift in the salary there was no uplift in the salary, and, following that, there was the recruitment process for the Auditor General for Wales, and, at that point, it was checked that there hadn't been an increase in the salary scale that it was linked to. When it came to us preparing for the audit, following the end of the financial year, we did a double-check just to ensure that there hadn't been an increase, and there had been a late uplift in the scale, following all the exercises that we'd done in the previous year. So, we identified it, we raised it with our auditors, and they were happy and content that we just did an accrual back to the previous year—
So, it was retrospectively done. So, the public services ombudsman is a different issue. What's the—?
Very similar issue. Again, it was a late recognition that there had been an uplift in the judiciary scale that his salary is linked to—again, not governed by us. The issue is that, when that salary is set up in London, we're not informed of it, so it's up to us to—
So, how will that not occur in the future?
What we have done is identified a director—so, one of the most senior staff—to have specific responsibility for oversight of that process.
Okay, thank you. In terms of the identification and selection of three new independent advisers to the Commission, how will that take place? What will the process entail?
That actually has taken place.
Yes. There was—
And I'm just clarifying that the word 'adviser' and 'director'—we're talking completely different—.
Yes. The advisers are people who are independent. They're not employed by the Commission, but they are members, with Suzy, of our audit and risk committee. They also advise on senior Commission staff remuneration and advise the Commission on a range of specialist issues. We had an open recruitment in the summer and we had a strong response. We then had interviews, which Suzy was on the panel for, and we are now in the process of sorting out the technical end part of the recruitment and should be in a position before long to name the successors of the advisers, which—Nia's showing me here; they're described in the annual report that you have been looking at: Keith Baldwin, Helena Feltham, Eric Gregory and Hugh Widdis, who will be leaving next year, all of whom have contributed hugely to our work over the last year.
Okay, thank you.
Just as a member of the audit and risk committee—I can't tell you how valuable these advisers are, who bring in expertise from outside. They can be very, very challenging and I think, actually, it was really good to see that we had such a strong field of people who were interested in doing this work for the Commission, for the Welsh Assembly. So, obviously, the reputation of this place as somewhere where it's valuable to be an external adviser—you know, that reputation is out there. So, I was just really, really stunned by the calibre of people we had.
Good. Okay. In regard to the fact that the governance arrangements have been in place for six months, obviously embedding—in your opinions, how have they progressed the status quo? What difference have they made?
Well, as someone who chairs the executive board and attends the leadership team, I'd say that they're working very well so far. They have improved clarity about where decision making happens, and I described earlier when I was talking about the capacity review how the two groups have worked together to enable us to streamline planning and service delivery. We will be putting in place a proper evaluation of effectiveness, and that will no doubt involve the Commission, the audit and risk committee and our internal audit team. It's a bit early to have done that now. We'll probably do that towards the time when they've been in operation for a year, which will be next spring.
Okay. So, that's planned. Thank you.
Finally, in regard to assurance around the Commission's responsibility for managing and seeking approval for payments—I slightly referenced this in my earlier comments—accruals and increments of pay from the Welsh consolidated fund, how confident are you that it is being fulfilled effectively now, bearing in mind what we've just spoken of and the actions being taken around the director, and also to safeguard for the future?
All the public appointments that we've mentioned are governed by different processes, different bits of legislation, and therefore it is quite a complicated picture. So, in future there will be a director who oversees all the different parts of the organisation that deal with that to give a bit of additional assurance. But I would note that everything has been done properly and the frameworks that we have for checking expenditure all worked as they should, which has been confirmed by Wales Audit Office colleagues as well. So, I think that I am confident as accounting officer that there is proper oversight of spending.
You say that you're confident and, in that regard, you've obviously made this action in terms of putting it under the ownership of a director. Do you think that that would safeguard this issue or area for the future, or are you—?
It's a further level of assurance.
I could provide Manon with assurance that, of course, we found those issues and we brought them to the attention of the auditors, and I think our audit report from WAO has one small recommendation to our audit and risk committee—the highest level of assurance from them. I think our chair of audit mentioned that—
The strongest audit ever, so—
We're very comfortable in our controls, our processes and the assurance that I can give to Manon as accounting officer.
Okay, thank you.
Thanks, Chair. Just moving to your sustainability report within the annual report, you've highlighted successes such as reducing energy usage and waste disposal targets. How do you ensure that these improvements deliver the maximum value for money whilst also still meeting your performance targets?
Yes, that's a good question. We certainly are pleased with our progress in terms of the highlights that you mentioned there. We have sourced the equipment and the services for all these works through competitive tendering processes, and so that should make sure that value for money is embedded in the improvements, as well as the environmental benefits. Obviously, increased efficiency and greater sophistication in terms of management of the systems will consume less energy and therefore we'll pay less over their operational life.
Thank you. What success have you had in encouraging low-carbon travel for staff commuting to and from the Assembly and also on Assembly business? I know that you've purchased a pool of electric cars and installation points, and a colleague of mine is particularly interested in this area. In what you've done so far, have you had success? Is it sufficient enough and what more is going to be done in the future?
Well, you're right that there's probably more to do. We're on a journey here, and we certainly do encourage and promote sustainable travel modes. It is impacted, obviously, from year to year by business need. We have seen an increase in air travel, and that's mainly Member-related need, but we will certainly continue to promote low-carbon travel for both business needs and for commuting. As well as electrical charging points, we've extended the bike shed and we're encouraging people to cycle to work and things like that as well.
In terms of the electric pool car, installation points and so on, what was the overall cost of these and when are we expecting to see money coming back into the Assembly?
The installation of the electrical charging points was done this Easter—it was around March of this year—and it was carried out by a Welsh small and medium-sized enterprise, as it happens, and cost about £13,000. Nia, do you have more detail on the rest?
The pool car—. The pool car costs around £4,500 per year on a lease, and we're expecting to have around £1,000 per annum of savings over the previous pool car.
Thank you. I'm certainly pleased that it's a Welsh SME as well that put them in.
We've also now got two pool bikes as well.
In regard to the fact that we are a role model and a lead, excellent employer in all regards, I would hope, do we feel that that's enough in terms of our environmental credentials in terms of electrical charging of vehicles, or has that assessment on the feasibility—?
We've only had them since Easter, to be fair, so—.
We'll monitor going forward. We'll certainly monitor—
It just seems a very small amount of finance involved.
We will certainly monitor going forward and—
I'm sure you could get into the broader issue here of where the electricity comes from, and, if it's coming from fossil fuels, then actually it's less efficient than a—. I won't get into that. Sorry, I interrupted.
I think the greening of the grid means that we're doing fairly well on our carbon footprint generally.
But it's going to be demand driven that, isn't it? But it's part of our job, I suppose, to encourage demand.
Okay. And that, obviously, will be evaluated at a certain point.
Yes. It's a bit early yet.
Okay. We'll come back to that, then. Thank you.
Finished. And lastly from me, unless anyone else has any questions, can you provide me with an update on the Assembly bus that was being used for public—? We left the best until last. The Assembly bus—
The wheels are no longer going round and round.
Manon is looking, 'Was there a bus?' There was a bus; I remember going on it at the Monmouth show, once. It couldn't get into the field because it was too muddy and it got stuck—I think they had to tow it out with a tractor in the end. But it was a—going back to the issue of engagement, it was a tool, so where is the bus at the moment?
The bus is sold.
I've talked a bit in this session about engagement, and we obviously have to review the way that we engage with people over time and we have to find savings and different ways of doing things as well in order to release the capacity in the financial year and in terms of staff resource for doing new things. So, we have refocused the summer show programme, and, as it happens, the bus was due some expensive refurbishment as well, so it was going to cost us rather a lot to refresh it and send it on its way again. So, we have—. It has been decommissioned now, and there's a saving—
'Decommissioned' sounds very grand. [Laughter.]
Obviously, this has enabled us to look at delivering more events around Senedd@ and planning for the twentieth anniversary.
At the Royal Welsh Show, the country shows, where you have the Welsh Government stand, is that combined with the Assembly stand now, or are they two separate—? Because I know, in the past, there were separate stands, and people used to be confused. They used to say to me, 'Why are—?' I mean, we know why there's a Welsh Government stand and why there's an Assembly stand, but I don't think the public always got that, and they thought that we were, you know, being profligate. Is that—? Do the two work closely together now? Do you work with the Welsh Government in providing that presence, or do you have to be separate for the—?
We find that combining forces into a single building, or a tent, doesn't help in terms of clarifying in people's minds the distinction between Welsh Government and the Assembly, the Parliament. So, the fact that people become confused maybe illustrates the problem. Although I'd like to think we'd work closely with Welsh Government colleagues in terms of education about the political process, I think probably it wouldn't help for us to share premises.
Yes. There'll probably be a whole other issue when the name changes as well—another name pops up to deal with. Do any Members have any other questions now?
Just, Chair, may I ask—?
Thank you very much, Chair. Thank you very much for all the papers you have—. I know Claire Clancy had a very strong and very competent standard in this place, but, certain areas, there was—. I don't want to go into details—the achievement was not what she would have done. But, in certain areas, you, as a chief executive—have you achieved something to improve the areas that I'm just concerned not to mention here, but, in your big organisation, you need some sort of service that caters for everyone, whether it's leadership, whether it's jobs—you know, delivering things. So, raising the bar is what I mean. Have you raised the bar a bit since Claire Clancy has gone?
It's a personal performance management and development review for me. Yes, it's an interesting question. I inherited a very high-performing organisation from Claire, and I'm glad of the opportunity to pay tribute particularly to Nia and her finance colleagues for overseeing very rigorous financial management during the year. I think our management letter from the auditors proves that and the fact that the governance framework is a very strong one.
In terms of what I've done in the year that I've been in post, I think that the capacity review, which we spent a bit of time talking about, has certainly been a big focus, bringing people together and looking at the distribution of resources to see whether we could accommodate all the new demands being made on this organisation—and they are formidable—at a time of change in the wider world without simply increasing resources. And that's been the main focus of my year—finding ways to do that and increasingly engaging with the people of Wales. So, this session has really focused on the matters that have been of concern to me as chief executive during the last year and a half.
Thank you very much.
Anything you'd like to add?
No, I'm fine thanks.
Well done, Suzy. I know you're suffering today with the lurgy, so you survived. Can I thank our witnesses, Nia Morgan, Manon Antoniazzi and Commissioner Suzy Davies, for being with us today? We will provide you with a copy of today's proceedings for you to check for veracity. I will see you again in the Finance Committee, no doubt, with another hat on.
We'll take a short break.
Gohiriwyd y cyfarfod rhwng 14:42 a 14:57.
The meeting adjourned between 14:42 and 14:57.
Welcome back, Members, to this afternoon's meeting of the Public Accounts Committee. Item 6 is the scrutiny of the annual report and accounts 2017–18 of the Public Services Ombudsman for Wales. Can I welcome our witnesses to this afternoon's meeting? Would you like to give your name and position for the Record of Proceedings?
Good afternoon, Chair. My name's Nick Bennett. I'm the Public Services Ombudsman for Wales.
I'm Katrin Shaw, director of policy, legal and governance.
Good afternoon. David Meaden, financial accountant.
Great. Thanks for being with us. We've a number of questions for you, so I'll launch into the first couple: what do you see as the main purpose of your annual report and accounts, and what steps have you undertaken to ensure that the report and accounts are easily understandable to the public?
Well, I think the report and accounts are a cornerstone of good governance and accountability. It's hard to be held to account without reporting on what we've done with taxpayers' money during the period of that particular financial year. Obviously, it's important that we comply with all financial and regulatory requirements and expectations.
This is the second year that we've brought the annual report and accounts together. We're told this is good practice; it reflects good practice from the National Audit Office. I'm glad to see colleagues from the Wales Audit Office concurring with that as well. I hope that it tells a story, as there's a narrative there in terms of what we've done throughout the year, that it provides a frank and honest analysis, that it highlights key trends in terms of what's been going on with public services, and complaints, in particular, and that it is understandable, I hope. It certainly uses a lot more infographics, for example, than it used to do. As I say, hopefully that narrative is there. I think the year in question was a positive year but a challenging one—not without challenge, given some internal and external pressures, the main external ones being a 10 per cent or 11 per cent increase in the number of health complaints coming to the office. That's put a significant strain on us. And also, some internal pressures, given that we had almost 10 per cent of the office take maternity or adoption leave. So, we're very grateful to all staff for the fantastic support that they gave during the course of that year, but, clearly, that specific issue did mean that, in terms of our efficiency, there was going to be some downtime when new people came in and had to be trained up fully—that, again, takes some additional resource. But it was a year when I think we certainly made progress in other areas as well, and I hope that that's detailed sufficiently in the annual report.
You said that the health complaints are up. Is that part of the reason why you closed fewer complaints in 2017-18?
I think it's one of the key reasons. It's not the only one. I think one of the issues would be as well the fact that 10 per cent of staff—. There was a higher than usual turnover because of maternity leave. I am concerned about the fact that we didn't close as many cases as we normally do. However, I think it's important to bear in mind that this doesn't reflect a lower level of activity; we're busy throughout the year and it's just that it's harder to close health complaints given that they're more complex.
We tend to be receiving more advice on every individual complaint now, because they often involve a significantly high number of co-morbidities. So, that has meant that we've been under additional pressure. All that said, though, there was a 10 per cent reduction in casework closures and, at one point in the year, it was almost 20 per cent. So, we've started to gain in terms of improving on that indicator and I think I'm right in saying that we've seen, in the most recent data for six months into this year, that we're back to where we were two years ago—so, back up to being as efficient as we have been.
Your report says that your office exceeded the majority of its performance targets, so how does that fit in with the issue of the drop in the closure rate?
I don't think it says that we've exceeded targets. I think it does say that we've made positive progress on our operational plan, so there's no confusion on that one. I hope that we've been very open and upfront in terms of our KPIs, and in particular on casework. But that's not to say that we haven't made progress in other areas, including the strategic plan, which will be coming to an end towards the end of this year.
I wanted to ask you about that. That's a three-year strategic plan, isn't it?
Is it clear how the annual report and accounts demonstrate your performance against that plan?
I hope so. Fundamentally, the strategic plan is about good complaint handling. An important issue for us as well is the improvement agenda and trying to make sure that bodies in jurisdiction are learning and are improving the way in which they deal with complaints. So, again, that is detailed. We talk about governance as a key priority—good governance—for us in the strategic plan and, again, I hope that that comes through when it comes to this annual report.
The final aspect of the strategic plan is to see the way in which the office develops with new legislation and new powers. Obviously, that is something that is beyond my influence, but I'm very pleased that the Assembly, in Plenary this year, voted in favour of the general principles of the new legislation and also the financial resolution. And I think there is more detail in the annual plan on pages 45 and 84; there are graphs and tables explaining how much of our annual resource we put against each of those priorities.
That legislation is being developed by the Finance Committee isn't it?
Of course—I've seen you with my other hat on there. You talked about the issue of the initial 20 per cent and then 10 per cent drop in the closure rate. What are you doing to make sure that, next year, we don't repeat the same problem?
First of all, some of this, historically, has been beyond our control in terms of the number of health complaints coming to the office. We're trying to intensify the work that we do in terms of improvement with health boards. I'm pleased to say that we haven't seen a further 8 per cent increase so far this year in terms of health complaints.
A significant number of health complaints that we receive—about 25 per cent—are about complaint handling. So, I think there's a lot more that we can do in terms of improvement. We've got some proposals that we'll be bringing to the Finance Committee on Thursday—
So, complaints about complaints.
More complaints about the way in which people are dealt with than about the treatment they receive.
Well, I was very surprised. We've done a lot more this year in terms of data analysis of the complaints that we receive. I was genuinely surprised to learn that fewer than 5 per cent of the health complaints that we receive are about surgery. Fewer than 10 per cent are about waiting times. Twenty-five per cent, as I say, are about complaint handling. To some extent, that's an own goal for the NHS, so I think, without in any way losing our own independence, the more work that we can do on improvement to make sure that there are fewer health complaints that relate to complaint handling that come to the office, then clearly that's in our interest, but I think it's in patients' interest, and it's in the NHS's interest as well. We are actively managing case flow. We've got an action plan in place. We've also done some benchmarking work and we're looking to rip out as much, or any unnecessary bureaucracy, and to sustain our capacity over the next year or so as well. Those will be critical issues, some of which are for the Finance Committee on Thursday, but I hope very much that they'll see that that should lead to us sustaining an appropriate casework closure rate.
Rhianon Passmore, did you have a question?
Thank you, Chair. So, in regard to the breakdown between those that are obviously complaints about the process itself, which you seem to be looking to mitigate almost as an own goal, and the breakdown around the other statistics regarding health boards or experiences within health, what is that increase—because it would still be an overall increase—down to?
Yes, in terms of two particular health boards. So, in terms of complaint volumes this year when it comes to health, a significant increase, but I was pleased to see volumes come down in some health boards—I think three specific health boards—
Is that in the public domain?
Yes, it is. It's in the report. But there were some significant—which again is in the report—increases for two health boards. I mustn't get these two wrong, but one is Abertawe Bro Morgannwg University Local Health Board, and the other one is Aneurin Bevan Local Health Board. I think we saw complaint increases there of 29 per cent and 34 per cent.
And is there any further breakdown, though, of why, or in your opinion what the issues are in regard—?
Not in the annual report, but what we have been able to do, and what we are doing on a regular basis now, is analysing which hospitals are experiencing these complaints, what type of service areas, what are the specific issues. Is it surgeries, is it waiting times, or is it complaint handling? How can we use that data so that there's a more informed conversation with the chairs and the chief executives of health boards, so it's not just, 'Right, here's your annual letter, guess what? Your health complaints are up. Try and bring them down.' We're trying to share some intelligence there, so they may want to think about: why is it that you've got a specific issue in that particular hospital? Why is it that we tend to be getting more complaints about certain services in your health board area than other areas? So, I would hope that that would help drive further improvements and be of greater use to those health boards as well, in terms of the way in which they try and triangulate the feedback that they get, not just from us, but from the Wales Audit Office, from Healthcare Inspectorate Wales, and other bodies as well.
Thank you very much, Chair. My question to the panel will be around efficiency and scope for future savings, actually. You say that great strides have been made over recent years in improving efficiency. What, if any, targets have you got for saving and can you explain how you have performed against them? Secondly, can you explain the main areas in which you have sought improvement and how you have measured the efficiency achieved?