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Y Pwyllgor Cydraddoldeb, Llywodraeth Leol a Chymunedau

Equality, Local Government and Communities Committee

11/12/2019

Aelodau'r Pwyllgor a oedd yn bresennol

Committee Members in Attendance

Caroline Jones AM
Dawn Bowden AM
Huw Irranca-Davies AM
John Griffiths AM Cadeirydd y Pwyllgor
Committee Chair
Leanne Wood AM
Mark Isherwood AM

Y rhai eraill a oedd yn bresennol

Others in Attendance

Greg Owens Is-gadeirydd, Panel Annibynnol Cymru ar Gydnabyddiaeth Ariannol
Vice-chair, Independent Remuneration Panel for Wales
Heledd Morgan Ysgogwr Newid, Swyddfa Comisiynydd Cenedlaethau'r Dyfodol Cymru
Change Maker, Office of the Future Generations Commissioner for Wales
Huw Rees Cyfarwyddwr Archwilio Perfformiad, Swyddfa Archwilio Cymru
Performance Audit Director, Wales Audit Office
Jessica Blair Cyfarwyddwr, Cymdeithas Diwygio Etholiadol Cymru
Director, Electoral Reform Society Cymru
John Bader Cadeirydd, Panel Annibynnol Cymru ar Gydnabyddiaeth Ariannol
Chair, Independent Remuneration Panel for Wales
Martin Peters Pennaeth Cyfraith a Moeseg, Swyddfa Archwilio Cymru
Head of Law and Ethics, Wales Audit Office
Sophie Howe Comisiynydd Cenedlaethau'r Dyfodol Cymru
Future Generations Commissioner for Wales

Swyddogion y Senedd a oedd yn bresennol

Senedd Officials in Attendance

Catherine Hunt Ail Glerc
Second Clerk
Jennifer Cottle Cynghorydd Cyfreithiol
Legal Adviser
Osian Bowyer Ymchwilydd
Researcher
Stephen Davies Cynghorydd Cyfreithiol
Legal Adviser
Yan Thomas Dirprwy Glerc
Deputy Clerk

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 09:00.

The meeting began at 09:00.

1. Cyflwyniad, Ymddiheuriadau, Dirprwyon a Datgan Buddiannau
1. Introductions, Apologies, Substitutions and Declarations of Interest

May I welcome everyone to this meeting of the Equality, Local Government and Communities Committee? The first item on our agenda today is introductions, apologies, substitutions and declarations of interest. We haven't received any apologies, but I know that Leanne Wood is running a little late, and I know that Huw Irranca-Davies will have to leave us for a short period from about 10.30. Are there any declarations of interest? No.

2. Bil Llywodraeth Leol ac Etholiadau (Cymru): Sesiwn Dystiolaeth 2
2. Local Government and Elections (Wales) Bill: Evidence Session 2

We'll move on, then, to item 2, which is our second evidence session on the Local Government and Elections (Wales) Bill. I'm very pleased to welcome John Bader, chair of the Independent Remuneration Panel for Wales; and Greg Owens, vice-chair of the Independent Remuneration Panel for Wales. Thank you both very much for coming along to give evidence today. I wonder if I might begin with one or two initial questions before other members of the committee ask further questions, and first, then, whether you support and welcome the general principles of the Bill. 

Thank you, Chair. Good morning, everyone. Thank you for the opportunity for us to give you our views and opinions. I would say that we can only deal, obviously, with the elements of the Bill that are within our remit. Those that are within our remit, generally, I think we do support the proposals that are within it. We had some discussions earlier on. The Minister provided us with an indication of what would be in there that would potentially affect the panel in its work, and we had an opportunity to comment on that as part of that process. So, yes, I would say that, generally speaking, for those elements that are within out remit, we do support it. 

Okay. You refer to discussions, John. What was the extent of the engagement that you had with the Welsh Government on the particular provisions in the Bill that impact on the panel? 

Mostly, it would be with the officials, obviously, within the local government division. We had an early indication from the head of the division of what would be in the Bill, again, that would impact us, so we had the opportunity to feed back some of our thoughts on that. That was before the final drafting, and then, we had an aide-mémoire about the exact information that was going to be in the Bill. So, again, we had an opportunity to feed back anything that we felt was going to impact on the way in which we operate. So, as far as we are concerned, that was an opportunity that was appropriate for our activities.

Diolch, Gadeirydd. Good morning. Could you expand on how the IRPW has played its part within the statutory guidelines and remit of the panel in providing a framework that supports the potential for improving diversity?

Yes. If I just deal with the first part, and then Greg can come in on some of the specifics. First of all, can I say, when the panel first set up, we put forward some principles by which we operate, and one of them was actually about diversity. Our view, which was supported then by Welsh Government Ministers, was that democracy is strengthened when the membership of the relevant authorities that we deal with adequately reflects the demographic and cultural make-up of the communities that the authority serves. So, that was a principle that we adopted very early on, and we've tried to provide in our framework elements that actually support that. Obviously, some of them—. Remuneration itself, and the way in which that operates, actually provides some diversity, but we'll talk about that later on, I think, when we get to some of the discussion.

The other area was to ensure that there was adequate support for members of councils, particularly principal councils, to carry out their work—that they weren't penalised financially by having to, for example, provide facilities for computer activities and so forth. We've built on what was already in existence, which was the care allowance, which the Welsh Government had introduced in 2003. We built on that and, over the years, we have tried to improve on that and get more opportunities for people to do it.

But, I have to say that it's still very disappointing. The number of claims that have been made, it's actually gone up a little in the last year, but it's still very small by proportion. We have 1,254 councillors in our principal authorities, and I think that we have something like 30 making claims for care support of one description or another. I don't know whether you want to add to that, Greg.  

09:05

No, I think that you've made the main points. Obviously, the remuneration structure itself, to put in place payments for potential and actual elected members, is a key part. Within the support for members, I'd say that there's a bit that I would describe as being quite successful over the years, and one bit that was less successful. The less successful bit is what John just described about the reimbursement of costs of care. Although the provision has been there, in actual fact, the take-up of it has been minimal and can't possibly reflect the reality.

We have been putting in place steps to try and encourage that, particularly around the way in which, if people are accepting reimbursement of costs of care—. Of course, it is a reimbursement. In the past, the way in which people have accepted that, and the way in which councils have operated that, has tended to involve the flagging up of individual members' names with moneys received against it, which would be made very public, which obviously doesn't encourage people necessarily to participate in that.

One of the areas in which we've been working, particularly recently, is to encourage councils to put in place structures whereby that element alone—. We're not trying to stifle transparency more generally, but in relation to that element alone, to encourage global reporting, so that a global sum—. But, again, these sums are minimal in budgetary terms.

The other bit that I think has been probably a more successful journey over the last five or six years is, in actual fact, although you'd think that some of this would be in place almost without thinking, it's the actual support for members once they are elected to actually exercise their duties. The range of provision was quite different across the 22 authorities. So, you might have some authorities where there had always been a tradition of making sure that members were very strongly supported, either in terms of training—. Particularly, as the move over the last eight years towards paperless working has increased, you did find some members who were excluded because they didn't necessarily have the digital capacity. And in some instances, in the worst cases, authorities weren't really encouraging elected members to have that capacity, so they were no more digitally linked up to the system—in fact, in some instances, less digitally linked up to the system, perhaps—than their next-door neighbour, depending on the capacity of their next-door neighbour.

But, what we have noted over the last five years, in particular, is that that is much more even now. The type of digital support, electronic provision and other things that enable people to discharge their role is much more consistent now across the board.     

Just to follow up on Caroline's question here and, in fact, your comments in terms of the aggregation of care into a bundle, rather than individualised and against named members, have you got any feeling at the moment as to whether councils are acting on that and are using that approach, and whether we can see that becoming more mainstream? I've certainly had it expressed to me—that fear of being individually identified, despite them being absolutely bona fide costs to help them discharge their duties because of caring. 

Yes. We've had lots of discussions, particularly with heads of democratic services and the chairs of democratic services committees, on this issue. Over the years, as Greg said, originally, it was part of the publication requirements. One of the criticisms levelled at that, and the reasons why there was short take-up, was because people were afraid that their communities would criticise them for doing that, and even some peer criticism from within the authorities. What we have done, we gave them the option of either reporting individually or, as Greg says, globally.

In our current draft report, which, later today, we're going to be finalising, we've actually said, 'In the future, you must only report this on a collective basis,' and we are comfortable that that is the way forward. And we had a very good response to that. In fact, no council has actually come back to us and said, 'We don't agree with that'.

09:10

Thank you. Good morning. The Bill's provisions to make the appointment of a chief executive mandatory with specific statutory functions technically fall outside your remit. Why do you therefore state that you believe that they represent the appropriate direction of travel?

Well, I think, as the paper we sent set out, we have regular meetings. After every election, we visit each of the principal councils, and we've done that since the power came into existence. We have discussions with members, with officers and chief executives, and we've found that there is huge variation and inconsistency in the role of a chief executive, which doesn't really suggest to us that it's appropriate. And, in fact, there have been some examples where some authorities have moved away from a chief executive to have some peculiar arrangements. Again, I think it is much better for local government to have a consistency in the approach, and this sets down what is expected of a chief executive, of the head of paid service, somebody who actually is responsible for everything, administratively, that goes on within the authority. So, we actually think that that would be beneficial in the longer term.

Is there any risk that the statutory functions could be broadened and leave that differentiation in place, or do you think this will bring greater standardisation?

It should bring greater standardisation across the 22 authorities. As I said, as you say, it's not within our remit, it's just a comment that we'd make on the basis that we have a fairly significant amount of knowledge built up over the years of how local government operates within Wales.

Okay. Moving on to section 61, which is replacements of references to salary with remuneration. How significant do you consider the amendment proposed, and what do you believe are the implications for yourselves and local government bodies in Wales of this change?

Which change is that?

This is the replacement of references to salary detailed in section 143A of the 2011 Measure.

Yes. I mean, as you know, one of our responsibilities is, where there is a proposed change in the salary of a chief executive, that has to be referred to us—whether that's an increase or, interestingly enough, whether, in fact, it's a proposal for a decrease. We then make our views known about that, either to make a recommendation to amend it or accept that it's an appropriate way forward.

I think one of the difficulties that have been brought up in the past is that that only relates specifically to the contracted salary. Some chief executives get other remuneration through other activities like what they get for being returning officers or, in fact, have other non-cash remuneration—cars and so forth—that could be increased, or bonuses; a whole range of things. So, really, it brings it into line with what, as I said, in the Bill, the Localism Act, defines as remuneration, which would include all of those issues. So, it gives a better picture of what the material position of a chief executive is as opposed to just simply dealing with salary. And there have been one or two cases—one quite infamous case, where one chief executive was having a leased car that was costing near £100,000 to buy. That sort of issue would not have been part of our remit, because, quite clearly, that's not part of the salary.

09:15

Thank you. You mentioned bonus. I think one of the considerations here is also pension—

Pension as well.

—but if bonus, as you indicate, would be included within this, is there a risk that this could become too performance related and, therefore, personalised, and could lead to short-termism, or personalised goals against corporate goals, which led, for example, to the collapse of the banks, perhaps, where many of the chief executives were being put on short-term, tail-end bonuses for very specific goals, and the rest is history?

It could do, but as long as—. Again, if they change the approach to a chief executive, for example, if they're appointing a new chief executive, and they make that a fixed-term appointment of three, five years, or whatever, with all of those factors, then that would come to us if there was a material change from the salary of the outgoing chief executive. So, at least we would have the opportunity to make our comments known back to the authority on that particular issue.

In terms of remuneration for the job, and you mentioned second jobs, which are actually integral in many cases as a returning officer, but some chief executives take other jobs, for instance—I don't know, chairing a fire and rescue authority or chairing other bodies in the region where they might work or across Wales. Should that be restricted, or should there be no limit on the number of paid, remunerated positions a chief executive could take?

To be honest, I think it's a matter for the council to determine how it restricts any employee in terms of that. I don't know of any examples of a chief executive taking the chair of a—

[Inaudible.]—clerk, secretary—the governance role.

Yes. Again, I think I would say that it would be a matter for individual councils to determine whether that's an appropriate thing to do.

Okay. My final question in this section is to ask your view on whether the definition of 'head of paid service' by a relevant authority in the Bill is clear in relation to amendments of section 143A of the 2011 Measure.

I can't see that it's a particular problem. I think we'd have to study the outcome, but, at the moment, looking at what the proposal is, it's fairly clear. While at the one stage, they're making the chief executive a statutory appointment, inevitably, I would have thought, almost certainly that is going to be the head of paid service as well. It seems inconceivable that the chief executive, whose responsibilities are set out within the Bill, would not also be the head of paid service.

Could I just ask you to say a little bit more about the provisions that can make the appointment of a chief executive mandatory and with specific functions? What sort of practical difference would that make, compared to the situation we have in Wales now? Presumably, all the 22 local authorities have a chief executive at the moment, do they? Is it more about the specific functions or—?

They may well vary the functions, although that would be quite difficult without analysing each and every one of the 22. I think there was one example of one council that decided it wasn't going to appoint a chief executive and it was going to try and operate on some corporate basis. Again, that would be something that may work, but I doubt very much whether it would give the same sort of structure that you would expect to have. I think they've changed again now, but nevertheless that was one example of the situation not being mandatory, and I think that lacks consistency. People do not understand what the difference is between that and having a chief executive. I think, generally, both public and staff would understand what a chief executive is and what they expect a chief executive to do.

Thank you, Chair. If we could turn to section 62, the reconsideration of remuneration following the direction by Welsh Ministers, could you just expand a little bit on why the IRPW supports this provision?

When we were given the additional duty in relation to chief officers, it was quite a bit of business, as it were—quite a lot referred to us. And in general we found that authorities entered the spirit of the thing, and where we had given our opinion, of which they were required to take due regard, in general we felt that they did take due regard, and we felt that the work that we were doing, the input we were providing, was moving things on constructively. There was the one instance where we didn't feel that our advice was being looked at in any way, and not responded to, and in fact on that occasion the then Minister did write, and that too was ignored, which we thought was disappointing. I think the reason why was because the legislation around it was such that, in actual fact, I don’t think the Minister had a great deal more power there. So, if I've understood this correctly, this changes things slightly—well, I think it would change it in a very constructive way insofar as, if a directive came from a Minister, it would make the process of responding to that more visible insofar as it would have to go to the full council and there would be a greater consideration. We feel that would be a constructive support of the role, and if that was put in place, it would be helpful.

At the time, one of the things we wondered about was whether, if there was press involvement under the existing situation, that might discourage people from taking what we saw was perhaps not a desirable step. There was press coverage—I can't say it was international press coverage, but there was local press coverage. But that didn't make any difference whatsoever. So, our view, I think, in relation to this, when we're talking about the strengthening and the changing of the position here, would be constructive in terms of the views that we express in this part of our work.

09:20

Thanks for that answer. So, in some ways you refer to one historical example where this power, if it had been in place, could have been used. Have there been others, or is it such an exceptional, unique circumstance that you still see it being useful as a backstop, then?

There's been an exchange of correspondence, when they made less about it—. I think there was only the one significant case, wasn't there?

Yes, it was a very significant one. It was a major structural review the council was undertaking and their chief officers were actually given very significant increases, which we felt they hadn't justified in the submission that they made and the evidence they were putting behind it. We made a recommendation to amend that and, as Greg says, that was ignored, the council decided it wasn't going to do that, the Minister issued a direction, and that direction was ignored as well. It's rather pointless having the legislation if it can't be effected in that way.

Since then we've found that, in the main, councils have been very compliant. Maybe that's because we've been more reasonable, I don't know, or whether in fact it's because they've accepted the role that we play. I think what's also happened is that their evidence to us has been much stronger than the previous situation that arose.

It's interesting that if some of these things previously may have been dealt with through back channels before they arose, and there's only one example, then the worry, playing devil's advocate, is that a power such as this could become overused and politicised through high media pressure and so on, and Welsh Government must step in all the time. But actually, from what you're saying, it's unlikely to be that on the basis that normally local authorities will act responsibly, with democratic accountability. It's an exceptional circumstance.

Yes, and I think it will change as well, because our role in respect of chief officers' salaries as opposed to chief executives actually terminates at the end of March next year, because it was a so-called sunset clause. So, we won't be dealing with that, and in some ways we think that that's appropriate, because I think we take the view that while we can understand the need to ensure that chief executives' salaries do not go to ridiculous levels, that in a way keeps the pressure on the salaries below, and therefore really doesn't need that intervention. So, I think the sunset clause was put in because, at that time, the then Bill was looking at significant reorganisation within local government. 

09:25

Okay, thank you. Could we turn to section 63, which is the appointment of assistants to the executive? Do any authorities have paid assistants at present and, if so, where are they?

No, they don't, as I think we said in the paper. This issue was raised when we visited. Leaders were saying, 'We could do with this, because it'll help bring on, maybe, younger people, give experience, allow development opportunities.' We do have within our framework an opportunity for councils to apply for additional paid posts, and that's one way they could have put that forward, but we've not had any applications for that, despite it. But I think that there is still certainly a request coming from Welsh local government that this is something that's worth pursuing, and I think that's why it's been put in the Bill. We will have to reflect that in our framework, which we would do in due course. 

This request that you've picked up in your discussions, is it quite widespread, or is it ones, twos or threes? It'd be interesting to foresee reasonably whether this will become a standardised request, then, from all authorities. 

That's a difficult one to say whether it would become a standardised request. As for your question, my recollection from two years ago, when we last met with the authorities, is that it certainly came up in at least four, five or six, maybe. 

I suspect that if this was taken through in this way and it was presented as a way of working, I think there would be take-up. I don't know that, but, from the dialogue we've had, there is a certain amount of enthusiasm presently for it. Although, that being said, there are no remunerated posts of that nature in existence at the moment, because we've received no applications. Even though, when we've had these dialogues with councils, we've said to them, 'There is provision, potentially, for this, there is a mechanism you could use', it hasn't been taken up. 

Okay. Thank you for that answer. Linked to this, what would be the benefits, then, of providing you with the delegated powers to override the statutory maximum number of members who can be paid for holding senior posts? 

Well, if this is taken up, then it potentially could be a problem for some of the smaller authorities—for example, Isle of Anglesey, which has 30 members, so that means a maximum of 15 paid posts, and Merthyr similarly. And some of the other smaller ones would be getting very close to that. Now, that means they'd have to go through a process of applying to have Welsh Ministers' agreement. Given that this is part of the reason for it, it seems that, more efficiently, we could deal with that. We're given delegated authority within our statutory responsibility to determine all sorts of things like remuneration, and we put caps on the number of posts that can be remunerated at this point in time, which is less than 50 per cent. So, it seems not an unreasonable move to make to say, 'Well, if that situation arises, if the panel considers it appropriate, why shouldn't they have the delegated authority to deal with it?'

That's great. Thank you. 

And if I can just turn, finally, in my questions to job sharing, section 64, this provision on removing barriers to greater diversity among executive members suggests that this will allow the panel to construct appropriate remuneration arrangements to meet an individual council's requirements. What do you see as the practical implications of this in reality, the consequences of this?

Well, I don't think there's a barrier to putting in place a remuneration process. Obviously, we'd have to fit it around—. Basically, if there was a job-share, whatever figures and structures we put in place, we would assume that there would be some kind of proportionate—whether it's a 50:50 or a 60:40 or whatever—some kind of proportionate handling of the salary. So, to that extent, we don't see it as anything that would be particularly challenging to work out a remuneration structure around. The only practical observation we would make from our experience where there's been some job sharing—there hasn't been a huge amount of it going on at executive level in our experience to date; there has been a bit—is that the remuneration issue hasn't been a tricky aspect of it; you just fit it proportionately into the structure.

This is not a remuneration point, but one of the observations we noted as we were looking through the current proposals was where you've got, for example, the assistant to executive member proposals, you make it very clear that there is only one executive member and only one holder of the post. If you then get a job-share situation and you're actually sharing that post, it doesn't have to be made complicated, but the potential for that to occur is there. Obviously, what you do need to be clear on is that if there is a desire to hang on to the clarity around the executive role, which clearly there is in terms of the way in which the assistant to the executive post is defined, then you need to be very clear amongst job sharers that, however it's handled, there is only one vote and then there's only one person exercising it. I think, anecdotally, that clarity hasn't always been instantly understood where these mechanisms have been introduced, in a toe-in-the-water way, to be fair, at the moment. 

I think they are encouraged. I think the view of the panel is that this would encourage diversity, potentially, and there are a lot of good reasons why one might go up this path. We don't think it would be too difficult to work out the remuneration side of it; I suspect that might be one of the easiest bits, actually. But the other implications around it, particularly if you're introducing these assistant to executive members with which there is a relationship, I think that's where the clarity would need to be there.

09:30

One of the problems that exists is that we've had a couple of applications, as it were, but the way the job share currently operates is one executive member does it for three months and then is replaced by another executive member, so it's not really a job share in that sense, because the problem lies within the statutory maximum for executive cabinets, which obviously, as part of the proposals in the Bill, will be amended. And I think that will allow what we would term as 'proper job share'. 

Thank you, Chair. Just on the section 66 family provisions, I noted in your paper that you talked about the need for you to amend your framework to align with the regulations. Does that cause you any particular problems? You're just noting it, really. 

Basically, it's simply just adding the words to comply with the changes that are—

It doesn't cause you any concerns or anything like that. 

That's fine. Okay. Can I ask you then whether you've got any concerns about the establishment of corporate joint committees, and whether you would expect to have any input into their development?

It's difficult to answer that because, obviously, it depends on how they're constructed. One of the issues that we have been investigating and will continue to investigate as part of our ongoing work is: what's the impact of collaborative working? What's the impact of the city deals, and so forth, in terms of remuneration? Does it have an impact on remuneration for the people who are participating in the corporate arrangements for city deals, and the like? Does it have any impact on what happens back at the individual councils? We haven't concluded with that yet. In a way, I think that would be the same issue for something such as the corporate joint committees when they're set up: what is the impact? And we'd have to investigate that in much more detail than currently we can do because, obviously, it's at very early stages of that construction. But we would look at it, we would examine it and come to a conclusion.   

But you wouldn't see yourself having a direct role in terms of discussions with the local authorities about how they do that; you would expect them to get on with that and then you would come in at the end of that process in terms of—.

I think, yes, in the main, we would be reactive rather than proactive in that. 

Yes, that's the point I'm making. Okay, thank you for that. One final question from me, Chair, is on the mergers and restructurings. What impact, if any, do you think the provision of that part of the Bill is going to have on your work? So, we've talked about the joint committees, but I'm talking about now mergers of particular local authorities. So, this is sections 141 to 143, I think, that we're talking about.  

Again, it's like crystal-ball gazing, isn't it, because it all depends on the specific proposal? For example, if you had two relatively small councils forming into one larger council, that probably would fit within our existing framework which we structure, as it is, into three population groups. If on the other hand it was a very significant one—. For example, let's say Cardiff and Rhondda Cynon Taf decided that they wanted to merge, that would be one mega council. We would probably then have to provide a bespoke framework for that, because it would be so much different to our current framework. So, I think, again, it depends on what happens. I don't think the panel would have any problem in doing that; it would just depend on what the proposal was.

09:35

You'd see how it develops. Yes, I understand that. Okay. That's fine. Thank you. Thank you, Chair. 

Just one final question from me, really. When it comes to assistance then to executive members and other provisions within the Bill, do you have any concerns about overall costs? We all know that democracy does cost, but it all has to be balanced up. Would you have any views on that? 

We have a statutory responsibility to satisfy that our proposals and our determinations are affordable, but that's not defined. So, and I think as we've said in the paper, we have to balance what we say is fairness to councillors with the affordability for local authorities. And the test of that is when we go out to consultation on our report, which, as I've said, we've just done, and we're about to finalise next year's report. The responses that we get will be, in our view, the test as to whether we've met that balance between fairness and affordability. I think, in some ways, councils themselves have to decide, should they decide that they want, I don't know, 10 assistants, two executives, if they've got a 10-member cabinet, can they afford it and is that justified. We may ask the question, but in a way that's their decision because they are making the decision about affordability, not us. What we do when we're making our overall determinations, we examine the total cost, so it's not just a matter of what it costs individual councils, but what is the total cost, and we factor that in to our consideration whenever we make a determination.

Okay. That's fine. Thank you very much. Thank you both for coming in to give evidence to the committee today, John and Greg. You will be sent a transcript to check for factual accuracy. Diolch yn fawr. 

Thank you, Chair. 

3. Bil Llywodraeth Leol ac Etholiadau (Cymru): Sesiwn Dystiolaeth 3
3. Local Government and Elections (Wales) Bill: Evidence Session 3

Okay then. We move on to item 3 on our agenda today, and our third evidence session in considering the Local Government and Elections (Wales) Bill. And I'm very pleased to welcome Jess Blair, director of the Electoral Reform Society Cymru. Croeso, Jess.

Perhaps I might begin with a first question on the general principles of the Bill, and that is whether the ERS supports and welcomes those general principles. 

Firstly, thank you for having me today; it's really exciting, and it's really good to see legislation going through on such interesting areas around democracy. In terms of the general principles of the Bill, we welcome the general principles in terms of the election reforms, but we can't comment on any wider—. It's quite a large Bill. 

Good morning. 

I just wondered if you could give us your thoughts on the proposals to extend the vote to foreign citizens that are legally resident in Wales. What do you think the potential benefits, or maybe the issues that that raises, might be for the Bill? 

So, we have no policy on foreign nationals, I'm afraid. What we would say is that, if the vote is going to be extended to them, it's really vital that communication is thought of and that they are made aware of the fact that they have this new right.

09:40

Which brings me on to my next question, which is about duty to promote. In the wider context, what is your position on the provisions in the Bill around the duty to promote and whether that should extend to Welsh Ministers in order to generate a central campaign, if you like?

We're not convinced that having 22 separate local authorities doing separate campaigns is that helpful. Obviously, we would like councils to write out to people who are newly enfranchised and make them aware of the changes here, but there is also a role here for Welsh Government to make sure that they're co-ordinating a central campaign. I think one that links with the 2021 elections as well, because you're going to have attainers at 14 registering next year for 2021 elections, so it makes sense for Welsh Government to capitalise on that.

And is that about maintaining consistency of message as much as anything else or just making sure it's done?

Yes, maintaining consistency of messages, but also I think Welsh Government not sitting back for the 2021 elections and making sure that they're properly engaged in the plans, because at the moment I think the Senedd Commission is really leading on those plans for 2021, which makes sense, but Welsh Government should be more engaged.

Okay, that's fine. And so, do you think the current framework for political education in schools is adequate at the moment, or, if not, what do you think we need to be looking at?

So, we would say that it's definitely not adequate. We've been in schools lately with the Senedd Commission. We did three schools across Wales recently, we did 12 last year, and there's a huge gap between some schools and others. There's no consistency across political education in Wales and what we need to see is a roll-out of better political education in the new curriculum, but also additional things in place now, such as discussion in form time and debate in assembly that really sets political education in motion, ahead of the curriculum coming in.

So, what is it that you're actually seeing in schools at the moment, because you say it's a very patchy picture?

Really patchy, yes.

Yes. So, what is the level of education at the moment? What is being talked about in schools at the moment?

So, Welsh Government will say that the Welsh baccalaureate covers most of their political education provision. We would say that, on the ground, that's very varied. No school we went to—. None of the students could identify who the First Minister was. So, I think that probably paints a really good picture. But that's not to say that young people aren't engaged. We went to Ysgol Bro Gwaun in Fishguard the other day and the young people were asking us about recycling provision, like, 'Why do I have so many recycling bins?', because they had rolled out a new programme there. So, young people are definitely engaged in local government and what's happening in their local community.

Okay, but did you pick up any sense that there was an understanding about different levels of Government and, you know, UK, Westminster, Assembly, local government? Do pupils generally understand that or did you not pick up a sense of—?

I think they sense that there is something. They know there's a Welsh Government; I don't think they're clear on what that does, and I don't think that's confined to young people. I think that there's a democratic deficit across the whole of the Welsh population. But I think we should prioritise teaching young people in Wales about Wales and what happens to them, what decisions are made and what happens at a council level.

Okay. So, I guess from what you're saying really that you don't think that the provisions in the Bill are robust enough in terms of that democratic engagement of 16 and 17-year-olds at the moment. So, what more would you like to see?

I think we'd like to see clearer plans from the Welsh Government. I don't know if it necessarily needs to be legislative, but definitely some sort of guidance being issued to local authorities on what should be done—a co-ordinated, central plan from Welsh Government. We have called for a duty to be extended to Welsh Ministers here. I think that that is going to be needed if they don't do those other things.

Huw, I think you wanted to come in on this, as well as perhaps going on to a few other questions.

Yes, I did, thank you, Chair. You had some interesting proposals around the lowering of the age for Welsh Assembly elections, which included proposals that you should have mock elections around the time of the Assembly elections in schools and so on. I'm just interested in how the ERS would look at the difference between political education within schools and the fear of political indoctrination in schools.

So, one of the sessions that we did with the Senedd Commission was with teachers, and teachers themselves are raising concerns about bias. But I think that's not necessarily that they feel that they would impart bias; they think that there's a perception around bias. So, what we would say to that is that any resource that needs to be made is about enabling young people to do the learning themselves. So, we would imagine things like: 'Go away and find out about a political party, see what their views are, and debate them in class', rather than a teacher telling you, 'This is good' or 'This is bad.' I think there are ways you can work around it. But I think teacher training is fundamental to political education and making sure that teachers feel confident with imparting knowledge to newly enfranchised young people.

09:45

Okay. Just one other short question on that, before I go into my substantive area of questioning, which is: we're all politicians; teachers will have their own bias and political understanding, world view and so on and so forth—so do politicians as well—but what does the ERS see as the role of politicians within education around politics and democracy? Should we be locked out of schools? Should we be let in with cages around us? What is the role of Mark, Caroline, myself and others in terms of engaging in the school environment, in a college environment, with young people? What should it be?

I think it's really important that young people have access to politicians. I think, given the extension of the vote, it's vital that that access is unbiased and they get to see a range of views. Young people have told us they want to see more from politicians; it's one of the main things that came across. They wanted to do Assembly visits, they wanted to meet politicians, they wanted to go to hustings. What we would say is there might be models such as in each region you have a live-streamed hustings that each school can tap into if they've got the technology, which they don't always have—but those kind of options to make sure that they get a range of views and have access to people that they're going to be electing. 

Yes. Thank you very much. Right, can I turn to voting systems? I'm just wondering about your views as the ERS on the provision in the Bill that allows councils to choose which voting systems to use—single transferrable vote, first-past-the-post and so on—and also linked to that your view on mandating STV or any other form of proportional representation for local government elections?

So, in terms of the permissive PR provisions in the Bill, we think that this is a step forward in terms of seeing STV being introduced in Wales. However, we've got some kind of major concerns that it's not a big enough step forward. While the permissive PR model isn't unprecedented—it has been introduced in New Zealand—I think in a Welsh context what we're likely to see is very, very few councils indeed actually taking up that opportunity. I completely recognise that the thresholds within the Bill are very practical and sensible, but I think that, plus the fear of changing to a new voting system, might stop councils actually doing it. What we would say is that we think the Welsh Government should reword the Bill to roll out STV wholesale.

Wholesale. We heard, Chair, from previous witnesses giving evidence that they had experienced no appetite for this amongst local authorities. What's been the experience in New Zealand, then, when it was, as you say, this voluntary approach?

So, only 11 of the, I think, 67 local authorities in New Zealand are planning to use STV for their 2019 elections. I wouldn't say that there's no appetite in Wales. We surveyed councillors over the summer. Twenty-five per cent of councillors came back to us—obviously they're self selecting so they might be more in favour, but 46 per cent of those against about 39 per cent were actually in favour of STV. There was a huge amount of questions asking for further knowledge about this, and I think—. Obviously, the provisions in the Bill around permissive PR aren't likely to be enacted until 2027 anyway. I think we've got an opportunity here in the next five or six years to really make sure that there is an information campaign rolled out around STV and the Welsh Government really rethink these provisions in the Bill.

Okay. Well, one of the ways in which that push towards developing a base where people would say, 'Actually, we should try this STV', has got to be experience elsewhere. So, what has been the experience, for example in Scotland, around things like promoting diversity within local government?

So, Scotland's experience of introducing STV started in 2007. It's been a really positive experience for them. They've seen a much higher level of voter choice—so, the number of candidates that people can choose from. They've seen much fewer uncontested seats. In two of the elections, there were zero uncontested seats, versus three in 2017, whereas we had 92. So, I think you can see the levels there. 

In terms of diversity, what I would warn about, caution about, is any electoral system being seen as a panacea for diversity. STV promotes diversity because you can use it to link to integrated quotas, that kind of thing. And it does stop safe seats, which we find hold back diversity, but it is really—. What's needed is STV alongside quotas.

09:50

That's very helpful. Anything else from the Scottish experience that would help us in our deliberations around whether we should be more forceful in terms of pushing STV or not?

Well, I think what we've seen from the Scottish experience is that voters really didn't have a hard time with it at all. STV is really simple for voters to understand. All they need to be told is that they have to rank candidates rather than putting x's in the box. So, in terms of voters, it's actually a really simple system. It's just the counting and all of that that provides a little bit more complication, but you need electronic counters to deal with that.

Okay. Thank you. Just one more question on this: if there isn't an appetite in Welsh Government or amongst the local authorities to take forward STV or other forms of electoral reform, do you see any other possibilities in terms of bottom-up support for it—so, through petitions or something along that idea that could flick a switch within a local authority to say, 'Well, there is an x number of thousand', or 'X majority of local people are demanding the opportunity'?

I think we're going to be going out to local authorities in the next year or so, meeting with councillors and executive leaders and trying to understand where support is on the ground there. Then we'll be approaching it from a grass-roots perspective. I think it's clear from this general election that the voting system that's used for both the general election and for local elections in Wales is not working. We've seen an increasingly high intention to vote tactically, and, when that comes to a local election, what that means is that people just won't bother to vote at all. So, I think we really need to be serious about looking at this as an opportunity and really go back to the drawing board where this legislation's concerned on it.

Okay. Thank you. If I could turn just to electoral registration, there are proposals within this that are very, very different in terms of the Welsh approach to electoral registration, including establishing an all-Wales electoral database, automatic registration without application. And, of course, this, whilst it has potential in terms of increasing the number of people who are registered there, does have issues then that knock on to data protection, privacy issues and so on. So, what is your take from the ERS on these provisions?

So, we very much welcome the intention to provide an all-Wales electronic register. It's something that other countries have been using for a really long time and it's worked very effectively there. It provides us with massive opportunities to do things like pilots, enable people to vote in different places, look at even the days and places that people are voting at. We do acknowledge that there are privacy and data risks with it, and we believe that the Welsh Government should work very, very closely with the Information Commissioner and security experts on this, and also take learning from other countries.

Thank you. And no dangers or pitfalls identified in other countries from this?

We haven't heard of any. There's nothing that's been reported, and it is really commonplace in areas of Scandinavia and Germany.

Thank you. Good morning. In your paper you don't express a view on proposals for council staff, teachers, foreign citizens to vote. Nonetheless, what are your views on the benefits and potential consequences—good or bad—of amending the qualification and disqualification criteria relating to those able to stand for election?

We don't take a view on that, unfortunately. 

Okay. If you decategorise it and you don't think of it in context of necessarily the positions I've just outlined—so, foreign citizens or teachers—. The concept—do you see any benefits or risks arising?

I think—. I'm really wary of developing policy on the hoof. What we would probably say is that people who are—. For example, teachers are particularly engaged in their local communities, but it's not for us to say whether or not they should be able to stand for office or what role they should take in local elections.

And, of course, that excludes officers in politically restricted posts, but how narrowly or widely do you think we should define that?

I think the current legislation is quite constraining. It probably accounts for quite a huge number of potential candidates or electors in that area. However, we wouldn't say which area that should be in.

Okay. In terms of foreign citizens, do you have any evidence internationally of examples where similar practices exist and what the benefits or consequences have been?

09:55

We haven't looked into foreign nationals; it's not something we have policy on, just because it's a very political choice rather than a kind of democratic choice. We often think it's often a choice of a political party rather than any kind of electoral decision. What we would say is that there are 135,000 foreign nationals in Wales, 70,000 16 and 17-year-olds. As much as there is around 16 and 17-year-olds needs to be given to enfranchising foreign nationals.

You're not aware, therefore, of any international precedent.

I can inform the committee that Osian is doing some work on that and he'll present a paper to committee in due course.

Okay. Moving on, you describe the provision or proposals for election pilots as an exciting development. Can you elaborate further on that and your view on whether the piloting of STV, referred to earlier, should be considered and incentivised by Welsh Government?

So, around pilots, we've been involved in the formation of this Bill in terms of giving responses to consultation, and we've really felt that pilots are a very exciting part of this. It very much depends on how they're used. The discussion has been very much around voting on different days and in different places and piloting those kinds of ideas. We think those are very exciting. The way that we do elections in Wales is very much the way we've always done them. They're on Thursdays because it used to be a market day. Is that the best way of doing it? We really don't know. So, it's right that we have pilots to experiment on this.

In terms of piloting STV, I'm really wary of the word 'piloting' STV; we shouldn't be piloting it, we should be rolling it out. Pilots are a kind of one-off to be used in by-elections, as far as we understand from this legislation. STV needs to be an extensive decision—so, lasting two terms—and with massive support of that local authority.

How would you respond to concerns that this could create tensions or disparities if you have adjoining councils or areas with differential systems and to the view sometimes expressed by residents in a given ward that they like having a named person or persons connected with their specific area?

So, in terms of the boundaries between local authorities, we recognise that it is a risk to have a patchwork of electoral systems. As I said earlier, it's not unprecedented. So, in New Zealand, what they have is a big information campaign, when it comes to election time, within those local authorities that have chosen to use STV. We would obviously say the best solution there, though, would be to roll STV out across the whole of Wales.

In the second part of that question about how voters feel, what we've seen in Scotland is it actually increases choice. It doesn't remove a local link. You often have multimember wards in local authorities anyway. All this is doing is ensuring that the voters' votes are proportional, that their voices are heard and they have more choice.

Diolch, Cadeirydd. Good morning, Jess. Regarding promoting access to local government, sections 46 to 48 obviously define the duty to encourage local people to participate. So, my first question is: do you think the current provision to promote access to local government is sufficiently robust to increase participation?

In short, no. We recognise that the principle of trying to improve engagement with local authorities is a really, really positive one, and we want more people to be engaged in local politics and local elections and in the work of a local authority. What I'm concerned about is that the legislation here is quite woolly in this area. It doesn't particularly give any idea of the kind of engagement that we expect to see. And there's some really good engagement and best practice going around in Wales. Cambridge council in England are actually doing a citizens' assembly on climate change at the moment. That's the kind of thing we want to see in Wales, but this legislation doesn't necessarily inspire that. And it also doesn't, I think, promote Welsh Government's role in actually imparting information to councils and the guidance and the support they need to do that.

So, my next question: the duty to prepare and publish a strategy to encourage participation—how likely is that to have the intended effect, really? And what additional provision would the ERS like to see included in that part of the Bill? I note that the ERS notes concerns that the duty to prepare a strategy is papering over some of the fundamental reasons that many people don't engage with local government. So, could you elaborate on that part as well, please?

10:00

So, what I think we are likely to see with the strategies is basically a replication of what we have now, so some local authorities being better at engaging citizens than others. I don't think there's anything in the Bill, as I've said, that really makes clear what kind of strategies—it's not really in the explanatory memorandum, either—we expect to see. A local authority, according to this Bill, could publish a strategy that says, 'We will speak to five people on a street.' That doesn't necessarily mean that they're more engaged.

In terms of the fundamentals, the Welsh Government's own research recently has looked at the barriers to voting and being engaged in local elections, and the major findings there were that there are fundamental issues in terms of a lack of political education, wider distrust in the political system, a lack of diversity and a lack of proportional representation.

So, if there is—thank you—good practice in one area, is it possible to take that good practice and attempt to roll it out, really, across Wales?

I think that's one of the major policy challenges that we have in Wales. There are areas of best practice in every area of policy, but it's really making sure that that's rolled out. I think that's Welsh Government's role, in a way—to facilitate that rolling out and bring councils together. That's what I really see lacking in this Bill.

Caroline, just before you go on, I think Mark wants to come in on this.

Just on the participation, if I may: how important is it that we move more to an enabling state role, so it's enabling people, bottom-up, to engage and have a voice, and also to engage the same people in measuring outcomes, designing and delivering the outcomes, so it's not just what their views are, but whether it's working or not from their lived experience?

I think that's exactly what Welsh Government's role in this should be—they should be facilitating better engagement. So, they should be publishing better guidance, they should be leading by example, they should be supporting local authorities to do really radical things such as citizens' assemblies, participatory budgeting exercises—it's really lacking at the moment, if that's what the Bill is actually intending to do or not. In terms of measuring success, I think that's absolutely missing from this legislation. There's no definition of success, there's no idea of how strategies will actually be held accountable, whether they'll be measured up against each other, whether Ministers will intervene if they're not sufficient enough, and I think that's clearly missing.

Regarding the petitions scheme, to what extent do you think the provision for petitions schemes—do they provide a robust and transparent mechanism at the moment that will give confidence to the public, do you think?

One thing we're particularly concerned about regarding petitions in this legislation is that there's nothing in this legislation to require councils to promote the scheme—that we've seen or understood. So, it's all well and good having a petitions scheme, and we know that people across Wales do engage in petitions. We've seen it in the way that the Senedd operates, we've seen it at a UK parliamentary level. Who's going to inform voters that this scheme is up and running, and who's going to measure its success and hold the local authority to account?

Thank you. And do you have a view on the provisions within the Bill to abolish community polls, which are to be replaced by the petitions scheme?

We don't have any views on the abolition of that. I think it really comes down to—to be honest, it comes down to which is most effective at engaging voters. I think the petitions scheme has a load of potential, but it has to be promoted and voters have to know about it.

Diolch. I wonder if I could just ask you about appointments of assistants to the executive. Can you tell us the extent to which the provision to enable the executive to appoint assistants will support diversity in local government, please?

So, in theory, appointing assistants could promote diversity, but there's nothing in this Bill to actually directly link it to diversity. What we've seen in local authorities already this local authority term is that we did have two cabinets with entirely male, middle-aged people sitting on them. I'm concerned that being able to appoint executives doesn't in itself guarantee diversity, and you could just replicate those issues we're seeing. Diversity needs to be fundamentally addressed, and I think that this is essentially a bit of a patchwork, and it might not actually improve things.

Do you have any suggestions how it could be improved from a diversity perspective?

10:05

I think directly linking legislation to diversity, in terms of the wording around this, as it's clearly lacking at the moment—the guidance that Ministers give. I think Ministers need to be a lot more strong on all-male cabinets and assistants, that kind of thing. So, I really worry that they haven't intervened enough when it comes to having all-male cabinets and a lack of gender balance in cabinets and leadership positions. So, I think that's something to be looked at.

Okay, thank you. I wonder if you can tell us whether the provision for job sharing provides the right amount of flexibility for local authority executives and whether it should be extended to other positions within local government, and whether or not that might help address this diversity issue as well.

I think to a degree it's definitely a start, and we've seen in Swansea Council, for example, job sharing being used really well. When we interviewed a couple of executive leaders who were job sharing last year, for our 'New Voices' report, they reported that it was a really positive experience. What we want to see is that being replicated across other local authorities. Again, there's nothing in the Bill to really guarantee that the job sharing is for diversity purposes, and we would obviously warn against it being seen as just something for women or just something for people from diverse backgrounds, just because we don't want it to seem like women can only do half the job, if that makes sense.

Yes. Okay. You've said that you believe that there's a role for group leaders to play in tackling issues around the misconduct of members, but the evidence notes that it's unclear which steps we're expected to take to promote and maintain high standards. So, what would you like to see included in the Bill to rectify this, and would some form of formal training for group leaders be required as a result?

Giving political leaders— . Holding political leaders to account much more over standards, I think, is a clear place to start in tackling abuse and harassment and the issues we've seen across local authorities in Wales. This legislation is quite unclear, as you said. We're really concerned that it's not clear what standards they're meant to uphold, or the kind of penalties for not upholding those standards. In legislative terms, I get that it's difficult to put in specific standards there, but I think the guidance, the explanatory memorandum, could be strengthened, and the guidance that Welsh Government give around it could definitely be strengthened. We would absolutely like to see more training, not just for leaders but all councillors, around abuse and harassment, and diversity.

Thank you. That was quick. [Laughter.]

Your work has found that abuse and harassment is a huge concern for those in elected office and you stated that standards committees have the potential to be an appropriate response. How, therefore, do you believe that the Bill's provision relating to standards committees' annual reports could be amended or strengthened to help this?

I think that having standards committees is good for transparency, it's good for councillors to feel confident that issues they raise will be tackled. What I would caution against is seeing them as necessarily a step towards diversity or tackling abuse and harassment. We've seen with the Senedd Standards of Conduct Committee that there have been issues, and I think it's fair that Welsh Government learn from that when supporting local authorities in establishing their own standards committees.

In terms of the legislation, there's a lack of clarity on how exactly standards committees will be held to account by members of the public or by Ministers, so that's something that should be looked at in this legislation.

And how do we ensure (a) diversity of the standards committee itself but also even diverse committee members will predominantly belong to groups with their own vested interests—how do you ensure that accountability and training ensures that, even with a diverse representation, the members are acting objectively?

I think that that's the key issue, actually, and when it comes down to the practicalities of actually establishing a standards committee, I think training, as you said, is vital and making sure that standards committee members are aware of their role outside of their political groups. In practice, that is difficult to achieve, and it's something that Welsh Government should really look to support local authorities on, and that's why I think it's really important that standards committees are able to be held to account. They have to, obviously, publish reports, but voters should be made aware of those reports. And we have a lack of a media role in Wales. Who is actually going to be looking at these committees, scrutinising them and making sure that they're actually held to account? I'm really not sure. So, I think Welsh Government are really going to have to step in there.

You indicated, I believe, that you believe that, beyond an annual report, there should be clear and regular updates. In what format do you believe those should be made available?

10:10

I think it's difficult. The standards committees often look at cases that are confidential, or that they can't report on until the end of a reporting process. I think what they can make the public aware of is their role. What they should be doing is engaging all local authority members, making sure that they feel confident to access the standards committee and make complaints, and make sure that they feel supported. It's something that's been lacking in standards committees here and also in Westminster, and we would really not like to see local authorities replicating these mistakes.

Okay, a final couple of questions from me, Jess, on areas not included in the Bill, so the access to the elected office fund and possible quotas, which you mentioned earlier. Would you like to elaborate on those matters?

Yes. It's something that we feel really strongly about, actually; it's something that we've discussed with other organisations in the sector, and we're all quite alarmed that a piece of legislation that says it aims to tackle inequality and promote diversity does not actually contain any effective legislation, we would argue, to promote that. We are very, very disappointed to not see an access to elected office fund. That's something that was recommended in 'Unpacking Diversity', the remuneration committee's report, a couple of years ago. We've echoed that. Other organisations such as One Voice Wales have echoed that. It's something we've actually discussed with Welsh Government, and we're really surprised not to see it in this legislation, and we would welcome an answer to why that hasn't been included. It may be that there were legislative issues or legal issues, but we would really welcome some discourse with Welsh Government around that.

We know that one of the major barriers to accessing local authorities and standing for office is a financial barrier. So, we know that people from different ethnic communities have issues accessing office. We know that people with disabilities, different age groups, lesbian, gay, bisexual and transsexual people really have issues standing for office and getting the financial backing that they need to do so. So, an access to an elected office fund I think is vital in rectifying the issues around diversity.

In terms of quotas, realistically, it's the only thing that's worked effectively in promoting diversity. We've seen it in the Senedd—all-women shortlists, twinning, zipping—those kinds of methods have, as much as they are controversial, really boosted diversity here. We haven't seen that in local authorities, and I think it's a major area the Welsh Government need to look at.

Okay, Jess. The final area from me, then: prisoner voting. The Minister has said that she may be minded to bring forward amendments at Stage 2 to allow for prisoner voting within specified criteria. Do you have a view on that?

We take no view on prisoner voting. It is very much a political and justice issue, rather than a democratic one, we feel. However, what we would say is that the way that it's delivered is quite crucial. We know that there are no women in prison in Wales, so all Welsh women prisoners have to go to England. We know there are issues with language. We know there are issues with the space in which Welsh female prisoners are spread out. So, it's really vital that when we're taking about enfranchising prisoners, we're talking about all prisoners to a certain length of sentence and not just the male ones in prison in Wales. And a major effort needs to be done to communicate to Welsh women prisoners as well if that is going to be extended to them.

Okay. Jess, thanks very much for coming in to give evidence to the committee this morning. You will be sent a transcript to check for factual accuracy. Diolch yn fawr.

Okay, the committee will break until 10.30 a.m.

Gohiriwyd y cyfarfod rhwng 10:14 a 10:30.

The meeting adjourned between 10:14 and 10:30.

10:30
4. Bil Llywodraeth Leol ac Etholiadau (Cymru): Sesiwn Dystiolaeth 4
4. Local Government and Elections (Wales) Bill: Evidence Session 4

May I welcome committee back after a short morning break? We move on to item 4 in our consideration of the Local Government and Elections (Wales) Bill. I'm very pleased to welcome Wales Audit Office officials to give evidence on behalf of the Auditor General for Wales. So, may I welcome Huw Rees—

Bore da. 

Good morning. 

Bore da.

—performance audit director for the Wales Audit Office? And also Martin Peters, head of law and ethics for the Wales Audit Office. Welcome to you both. 

Thank you. 

I will begin, then, with a question on the general principles of the Bill and whether the Auditor General for Wales supports and welcomes those general principles. 

Yes, I'd like to say that we do, particularly principles around more openness and transparency in reporting performance requirements. We welcome a more consistent, coherent approach to the collaborative agenda in local government. I think we welcome that. Increasing public participation is obviously a good principle to adhere to, also. And the description around more self-awareness and openness to challenge in local government. I think those are the principles that we're pleased to see in the Bill. 

Okay. Thanks for that. Could you tell the committee what sort of engagement you've had with Welsh Ministers and their officials, particularly regarding the provisions in the Bill that directly impact on the Auditor General for Wales—what consultations, conversations, et cetera?

Yes. Well, as you'll know, this has been a while in the making—a few iterations of several White Papers—and we have been involved in both formal and informal consultations throughout that period. I'm also pleased to say that, due to some of our responses to those consultations, some things have changed in the Bill, which we welcome. There are other things that you'll see that we may have concerns about that haven't changed, but perhaps we'll talk about those a bit later. I guess there's one thing that we would, perhaps, like to see for the future, which is a bit of a closing of the loop in respect of when we, maybe, express concerns through consultation. We get feedback on what has been accepted or not, but maybe not fulsome reasons why. So maybe a closing of the loop would be helpful in the future. 

Okay. That's quite interesting. You'd see engagement between Welsh Ministers and officials and the Auditor General for Wales improve if there was that further engagement at the end of the process, really. 

Yes. Okay, thanks for that. We'll move on, then, to Mark Isherwood. 

Thank you. Good morning. Although the Auditor General for Wales notes that the general power of competence provisions in Part 2 of the Bill are—quote—in principle appropriate for local authorities, he warns that, even with the general power, there are limitations to its use and he notes that authorities will need to spend expert time on checking limitations. So, what do you believe are the risks and benefits associated with the general power of competence, particularly for community and smaller councils and their residents?

I think you can see some of the risks in some of the recent public interest reports. For example, Connah's Quay, Quay Cafe. There, the council engaged in a 20-year lease on a building and didn't have a solid business case for running that operation, and that led to a £234,000 deficit, which is increasing the precept. They didn't have a clear legal basis for running the cafe. It couldn't be justified under section 137 of the Local Government Act 1972, but I think now they would be able to rely on the general power of competence to do that. So I think the risk is that it'll help—help in terms of providing greater latitude to do things—but the risks of doing things that aren't well thought through, particularly in financial terms, remains and, if anything, the probability of something like that happening again may increase.

In terms of benefits, there are examples around where, in England, parish councils have picked up services that have been discontinued by district councils or unitary authorities, county councils, and that's a useful filling of the gap in terms of public services in some cases. There are, I think, also some interesting things around community power generation and supply. I think those are reasonable things to do, but it is a matter of—. They need to carefully think about the business element of what they're trying to do, as well as identifying that they've got this power to do it, so not doing things for the sake of exercising the power, but doing things that are really useful and beneficial. 

10:35

Thank you. As you may be aware, I was copied into the correspondence regarding the complaint to Connah's Quay Town Council that you referred to, and I'm very familiar with the battle the complainant had to even get to the point where he could make a complaint, having exhausted attempts to address this directly, but there we are.  

I shouldn't, perhaps, single out Connah's Quay, but it's one clear example, but there are others. 

Yes. In that context, the Auditor General for Wales has expressed concern with the

'limited affordable access to suitably qualified and expert advisers in public law'

for community councils. Can you expand, therefore, on the challenges that principal and community councils will face in terms of acquiring the necessary resource and expertise they need to use the powers effectively and efficiently? 

Unlike principal authorities, community councils generally don't have their own in-house lawyers. They often are fairly unfamiliar with public law requirements or, more particularly, they might be familiar with local solicitors, but those local solicitors aren't necessarily the people that you need to advise on this kind of thing. So, there is a need for them to be able to be signposted to suitable sources of advice. Of course, that kind of advice is not cheap. There are other avenues available to them, such as through the local council associations, but there is a danger that they may try and rely on generic advice on these matters, rather than taking specific advice on the specific facts of their particular situation.

There is quite a bit of advice around. For example, the Local Government Association has provided guidance on the use of general power of competence for English parish councils. That's fairly useful, but it does bring with it the danger that it doesn't fit the Welsh situation. The formulation of the general power of competence in the Bill is not exactly the same as it is in the Localism Act 2011, so that could raise some pitfalls if Welsh community councils try to rely on English guidance, for example.   

I think one way would be for the Welsh Government to provide very clear guidance, signposting where appropriate advice can be obtained. That would be one way. 

You refer to a situation in England where there is a shared provision in the context of the localism Act. Is that a model that we could seek to replicate on a smaller scale in Wales?

10:40

Well, the model we've got in Wales in the Bill is similar, but it's not exactly the same. One difference is that there is a reference to limitations imposed by pre-commencement powers, which is not in the Welsh provisions, as far as I can tell. That means that there is, I think, a bit more latitude in the general power in Wales, or there will be. 

Would it be beneficial to follow the English model? Well, it's a slightly more complicated model, I suppose, in that there are more things to check, but, on the other hand, there is the benefit that the English model has been in place for some time and it's probably safer to follow the precedent there, but it's a policy question for the Government as to whether to have a more liberal general power of competence than in England.

You mentioned having more things to check, but could that be defined in the context of early prevention—intervention to prevent greater complexity and cost later?

Well, yes, it might. It is really a policy decision as to how tight the Government want to make the general power.

We have to consider, collectively, whether this isn't appropriate, or whether we recommend changes, and hence you can't intervene in the political aspect of this, but from an operational viewpoint, as the Wales Audit Office, I wonder whether you had a view.

In a sense, there would be fewer problems legally, the simpler the general power of competence is. My view is that the powers that we've got here are a bit simpler. However, the simpler you make it legally, I think you increase the probability of people using it, or councils using it, in ways that may be problematic financially, so it's a trade-off.

Martin, before you go on, I just want to ask a question that follows on from some of the points you've made, which is the exercise for the general power of competence by community councils and the provision in chapter 2 under 'Eligible Community Councils' section 37(3), which is that to become an eligible community council, the second condition is that the clerk to the council holds such qualifications as may be specified by Welsh Ministers by regulations. That's paraphrasing. Are you content that that's sufficiently robust in terms of that ability of community councils to exercise a general power of competence?

In terms of the conditions that are set out in section 37—

Yes. I think the use of an audit option is problematic here, because an audit opinion is not designed—the audit is not designed to address the issue of competence to exercise general power of competence. It's not wholly irrelevant in that if there is a qualified opinion, that may identify problems in the council that are relevant to its ability to exercise the general power of competence, but it's not the whole story; it's not a comprehensive analysis of whether the council has the ability to use that power. And it would be going beyond the existing remit of the auditor, the matters that are required—

10:45

We're coming on to some of those matters. But I just thought, in terms of the clerk to the community council and the qualification that the clerks should hold and the relevance of that to the exercise of the general power of competence, whether you consider the provision there that Welsh Ministers will specify what qualification the clerk should have, whether you consider that is sufficiently robust in terms of the exercise of the general power of competence.

I think it could be, it depends what they specify. Certainly, in England, there is a specification in an Order for parish councils as to which qualifications the clerk should have—things like a higher education diploma in local government administration. That kind of thing strikes me as quite sensible. It might be possible for the Government to consider perhaps providing its own test, as in a qualification that clerks can undertake, say, by correspondence or something like that. Because I think one problem may be that if you specify a list of qualifications, you'll have a lot of clerks who don't have those qualifications and that could really be quite problematic. So, a simple competency test might be a helpful thing to provide, but the approach of using secondary legislation or an Order is a sound one. I don't think you want to put a list of qualifications on the face of the Bill.

Thank you. Moving on to becoming an eligible community council, the auditor general has noted that audit work is not designed to provide assurance as to whether a council meets competency requirements and recommended having a separate process whereby councils could request a report on fitness for competence. What therefore are the audit office's concerns regarding the inclusion of an unqualified opinion as a condition of eligibility for the general power, and how a separate reporting process could provide greater security and value for money?

As I was saying, the audit is designed to meet the requirements of Part 2 of the Public Audit (Wales) Act 2004, so it's looking at whether the accounts are prepared in accordance with regulations and statutory requirements and properly present the financial situation of the council. We don't go into the fitness of a council to make decisions in terms of the exercise of its powers. We will identify problems where it goes wrong, for example, but we don't go looking for those problems. We don't review all decisions. I suppose it's using, say, a veterinary qualification to assess the fitness to practice human medicine. It's not quite the same thing. So, yes, we think if there is going to be a test like that, then it should be something that's a bit more focused on the matter in hand, rather than the opinion.

Right. Can you explain a little bit more on why you believe that is the case? What are the risks, should I say, of not—

Sorry, the risks of—?

Well, for us, the issue is that you're, in a sense, relying on the audit certificate, the audit opinion, to assess competence when that's not what it's designed for. So if, say, you have a situation where a community council tries to use the general power of competence for some, I don't know, trading venture and it comes a cropper because it's not well thought out—perhaps they engage with a private sector partner who takes advantage of them, things go wrong and a lot of money's lost—at the end of the day, someone may say, 'Well, the auditor general gave a clear opinion, so the auditor general should have spotted this.' It's like, 'Well, no, that's not what the opinion is for.'

So, if you want to make a decision or you want to set a criterion for exercising the general power, I think it has to be something that's more matched to the ability to do it, rather than whether you can just prepare accounts. Okay, preparing accounts is an important thing and perhaps the inability to prepare accounts would be a sign of, 'Well, this council is perhaps not up to exercising the general power of competence', but it isn't sufficient, I think, to be a condition in this way.

10:50

Thank you, Chair. Collaborative working: in your evidence, you talked about the definition of corporate joint committees falling within the public audit Act 2004. Are you suggesting that you think that that definition should be included in this Bill because there's some confusion around it, so to have that definition on the face of this Bill would also be helpful?

I think it would, certainly for the purposes of clarity, just to clarify that these committees will fall under that as a joint committee.

Yes, okay. That's helpful, thank you for the clarification. I also noticed that you've made reference to the fact that you've frequently commented on the complexity of the structure and governance of public services. You've said this on many occasions. So, how do you think that Part 5 could be amended or strengthened to provide clarity around any new structures for public service delivery?

I'm not sure whether, actually, Part 5 on the face of the legislation needs to be amended. That clearly sets out what a corporate joint committee is for and its purpose. I guess what we have been saying over the years is that there is already a complex picture of collaboration across Wales, across many public service bodies, public services boards, regional partnership boards, education consortia, all in that collaborative arena and frequently on different footprints. Our observation is that this potentially adds to that complexity, or, actually, potentially, tidies it up, it depends on how those powers in the Bill are discharged and the footprint that will develop from that, either by voluntary entry into corporate joint committees or through ministerial direction.

Okay. So, you would want to see something possibly in the explanatory memorandum around that, maybe, or—.

And certainly in guidance.

In guidance as well, yes, okay. That's helpful, thank you. Thank you, Chair.

I wonder if you can tell us the extent to which the auditor general believes that the provision for panel assessments with appropriately skilled and experienced members could provide the objective and independent assessment required.

Sure. I think they have the potential to do so. What we're unclear about, actually, from the Bill, which I'm sure may be clarified through guidance, is the extent for ensuring things like conflicts of interest are covered off, how conflicts may be resolved when panel assessments come up with views that maybe principal councils don't agree with, what are the arrangements for clearance, due process, natural justice, that sort of thing. Otherwise, if these sorts of things aren't tidied up and due process followed, the potential for judicial review if a council disagrees with a panel assessment is there.

In terms of the capacity of the sector to deal with the volume and timing of panel assessments, that may be a concern. Although the requirement is once in a term, there are few councils that will want a panel assessment towards the end of an electoral term. Many will want those in the first couple of years, which may compress timescales and add to a capacity problem in terms of suitably qualified and experienced panel members.

10:55

Can you expand on those concerns, and in particular the impact, potentially, on the work and the costs of the auditor general?

In terms of the auditor general, I'm not—. I really don't know what the result will be, but if panel assessments work well, then the auditor general would be happy and I don't think that would create any further work. If, however, panel assessments prove problematic because they lack objectivity, then that will be something that we will probably need to address as part of the audit. So, in terms of satisfaction as to arrangements for securing value for money, we'll need to consider whether the panel assessment system is working properly. I wouldn't say it would be a great deal of extra work necessarily, but it's another thing to take into account.

I think an observation I would make is about the coherence of the whole system, as it were: panel assessments being one part, self-assessment another part, and the work of the auditor general another part. I guess what we wouldn't like to see across local government is any duplication of effort there.

Peers have a very valuable part to play, I think, in sector-led improvement and I think we need to draw, perhaps, a distinction between assurance and improvement. I think, as currently set out in terms of how it describes a panel assessment, in terms of assessing whether a council has discharged its duties under the performance requirements, it sounds to me like assurance, and our annual role in terms of looking at our proper arrangements duty in the 2004 Act is very much in that territory. I would suggest that peer support is a more targeted intervention, which may pick up on the work of the auditor general, and think about, 'Okay, if these are the issues at this council, where can we provide that additional support that this council needs?' What we wouldn't like to see, I guess, and we have some experience of this, is that peer reviews or panel assessments actually just replayed what had already been surfaced in terms of maybe some audit work, and just duplicate to that extent. That has the effect of delaying any potential support that comes along, because we then wait for a peer review that only confirms what we already know and that delays the support types of intervention. 

Okay. Is there anything further you can say in terms of the risks or benefits related to the appointment process of panel members, and whether you think there are sufficient robust safeguards to prevent self-interest undermining the objectivity of the panel? Can you expand on that?

I think, in terms of the Bill, the mechanisms aren't there for addressing conflicts of interest, other than to provide for the Welsh Ministers to provide secondary legislation to deal with that. And I think that is going to be quite important. So, there need to be arrangements for declaring interests before appointments. There needs to be careful consideration about fees of panel members, who will probably need to be paid. That reliance—. There is a self-interest there in terms of essentially being in the situation of criticising your paymaster, kind of thing. So, that needs to be given some careful consideration. But, yes, the mechanisms aren't on the face of the Bill. They will have to be in secondary legislation, I think. But they will need to be there, otherwise there will be problems in terms of conflicts of interest.

11:00

Okay, and finally, is there anything further you can say on the special inspection report—the power of entry and fees—in terms of the impact on the work of the office?

Sorry, on special inspections, did you say?

We have quite a few concerns about special inspections. In principle—well, not just in principle, I think; in fact, the provisions on the face of the Bill are sensible insofar as they are about special inspections. Our concern is the way that there is a link between special inspections and restructuring. The receipt of a special inspection report is a condition for the Welsh Ministers to make restructuring regulations, so to require restructuring. 

It does rather queer the pitch, as it were, in terms of inspections, because if there is that automatic meeting of the conditions for restructuring, the authority is going to be very concerned about having a special inspection and may not be co-operative, and may be quite resistant to the process. Special inspections aren't fun for authorities anyway; they don't like them. This will make it especially hard to do them. I think they will be quite contentious.

And it does mean, I think, also, that the auditor general is in a difficult situation in that he may be thinking, 'Well, there is an issue here, but if I produce a special inspection report, notwithstanding it's got nothing to do with the structure of local government, it may be restructured.' So, we don't like that link and we don't think it's helpful, and we think it may distort decision making in terms of restructuring, and also, potentially, in terms of decisions to undertake special inspections.'

Yes. I think there's no doubt that special inspection reports will form part of the thinking and evidence that one might consider, but to have it as a condition, as Martin says, is problematic, I think.

Okay. Perhaps at this stage, we'll go on to some questions that I know Huw Irranca-Davies has that are relevant.

Yes, just to follow that up a little, I just want to probe into a bit more detail on the reservations you have on this link between the special inspection reports and restructuring. 

Under section 128, it says in subparagraph 2 that the first condition is that Welsh Ministers have received either a report of a special inspection of a principal council by the Auditor General for Wales or an abolition request. If you were sitting in a Welsh Government Minister's position and you were looking at it—and let's assume this is going to be an exceptional circumstance—I think you'd probably accept that. This isn't a power that, if it went through as it is, would be used on a daily, yearly, even sessionally basis. This would be exceptional for a Welsh Government Minister to think, 'I need possibly here to take action.' They wouldn't want to do that, purely on the grounds of being accused of political shenanigans. They'd need somebody to actually say, 'Do you know? You're right, we've had a look.' So, a reading of this is that it's quite reasonable. A Welsh Government Minister would turn to the most authoritative organisation to cast its rule across a local authority to see if they're fit for purpose, and that would be you.

11:05

But they can do that anyway, without it being a condition. So, if we take away the provision for the special inspection report being a condition, if we do special inspection reports, we might even do them on request, then Welsh Ministers can take that into account in making their decision. They can say, 'This special inspection found that this authority was completely underpowered in terms of its senior team, it struggles to recruit sufficiently qualified people, it needs to be merged with somewhere else', say, then that's fair enough, but not to say, 'There's a special inspection report, that's a condition for restructuring', despite perhaps the special inspection report saying nothing that really relates to restructuring.

But my reading of the draft of this legislation that we have in front of us as laid is not that it's a requirement that the special inspection report leads to restructuring; it's that they must have received a report of a special inspection. It's not that that then is linked to, 'And then, tick, you now must restructure'; it's that the Ministers must have in front of them a report from you. Am I misreading it?

I don't think you're misreading it. It's a subtle problem, in that it means the first tick in the box is in there. Until that tick in the box is there, there can't be regulations made like that. So, it does put an onus on the decision that the auditor general makes in terms of a special inspection—that, by doing this, I'm putting that first tick in the box. Okay, it doesn't automatically lead to a restructuring, but it does enable it by that method. So, it does have an influence.

Yes, I was just going to say that the other issue for me is that having it as a condition perhaps constrains more agile approaches, and I'll give you a recent example where we wrote to Merthyr council with some serious concerns around finance and governance. Now, in discussion between the leader and Welsh Government, a support package has been put in place, and some peers are actually there looking at how they can best support that council. We haven't undertaken a special inspection on the basis of what the peer support might recommend back to Ministers—there might be all sorts of considerations. As I say, we haven't undertaken a special inspection. If this Bill were in place then, we would then be asked to undertake a special inspection to confirm what we already know through our regular work, having written to the council and, of course, obviously what the peers have also said.

Okay, so if we can agree on two things—and I'll ask you for a possible alternative way forward then—the two things we'd probably agree on is that it would be an exceptional requirement for a Minister to use these powers under 128, particularly the one in terms of not having the request. It's an either/or, so a request having come under section 129 from a principal council, or a report of a special inspection of a principal council by the auditor general. It's going to be exceptional. I see the link that you're making, but I query the extent to which this would—I'm just challenging you a little bit—muddy the waters, queer the waters, and the way that it would risk reputational damage for you as well. But if we agree that a Minister shouldn't be taking these powers to restructure on themselves, unless they have darn good reason to do it, and you are the best people to do it, if it goes beyond other softer interventions and so on and so forth, what would be your proposal then to Ministers in terms of reshaping this Bill? Because I think you're agreed that they would need some sort of partial inspection or maybe a full inspection to find out what's going on. What is the alternative?  

11:10

I suppose the linkages that are clear for me are not linkages to process—special inspection is a process—but linkages to the potential causes or failures: failure to set a balanced budget; continual use of section 114, which is a freeze on expenditure powers that section 151 officers have; systemic failures in key services. These are the sorts of symptoms that might lead you to think that this council is not viable in terms of the way that it's performing its duties, rather than linking it to a process. Now, whether that's something that can come on the face of the legislation or by Order or secondary legislation is a matter for the lawyers.

I think a more appropriate mechanism would be to have specifically a review. This looks like substituting special inspections, which we might undertake for various reasons, as a substitute for a review of the structure of local government in an area. And I don’t think that's appropriate; that's not what special inspections are designed to do.

Okay. I'm quite interested in the alternative that you've put forward here, because if any one of us was a Minister in this position, we would want rigour behind the decision in terms of restructuring that hadn't come at a request. Now, you may have alternative ideas. Are you likely to be putting those ideas forward? You clearly want this bit pulled out from, 'The first test will be—'. But I'm interested whether you're going to be putting something more specific forward, so, 'Minister, don’t worry, we have another way forward for you', and what you need is that written into a separate clause or a sub-clause or some guidance, or whatever. 

We can firm up on suggestions, yes, and provide, perhaps, some thoughts in writing. I don’t think it would be right to try and draft something here and now.

You seem to be describing—correct me if I'm wrong—effectively the existing powers you have to carry out public interest reports, where, if you find anything that needs changing, you will make recommendations to the council to implement that, whether it's, going by examples in the past, effective appraisal systems or not holding black-box meetings, or whatever it might be. But it gives a picture to the reader or the Minister of how effectively that council is operating at the point in time. Might that be a better mechanism to keep you impartial and neutral, but it would nonetheless enable a Minister to get a view?

I think, certainly, any reports of the auditor general, be they in the public interest or special inspection reports, need to be considered as part of any decisions about what interventions or support Ministers may give.

Taking Martin's point, more often than not our reports will not talk about potential structures that we might recommend; it would be beyond our remit, really. So, it's the issue about restructure and its linkages through to the work that we might do that is specific and, in the case of public interest reports, very specific, which is the potential problem here that we're talking about. A requirement for Ministers to review potential options around structure as a condition might be helpful.

11:15

Thank you. Only one question: having had delivery put to you quite hard on this, I just want to offer you the opportunity to talk a little bit about the financial implications of this, if it were to stand—realistically. Realistically, what are the financial implications? You've talked about reputational implications and that muddying the water around the relationship between you and Government and decisions on restructuring, which inevitably will have not only some evidence behind them, but some politics behind them as well, but, financially, the implications of this.

Well, there will be financial implications, I think, because with the link in place, as I've said, there'll be resistance. So it will take longer to do special inspections than would otherwise be the case, people will be more defensive. We'll have an uphill job collecting evidence. Despite the fact that we've got good access rights, it is important to have co-operation, because you can only ask for the things that you know exist. Co-operation enables people to share what isn't asked for, if you like. And, as well as the increased cost of fieldwork, we've then got the issue of clearance—I don't like the term, but we use it a lot—which is giving people who are criticised the opportunity to comment. Now, that could take a very long time and a lot of effort, a lot of to-ing and fro-ing, where they're saying, 'That's not a reasonable conclusion', or 'You've not got the facts right on this; we think it's this.' That can swallow a lot of time and money up. And then, potentially, we've got the situation where if, say, restructuring orders are being considered by Ministers, the authorities may challenge the special inspection in the courts. So, it might suggest that we've not followed proper process. And that kind of process always gets very expensive and it will be, I think, really very onerous for us. 

What would your assessment be of the likelihood of judicial review? I have my own views on this, but if a local authority was facing, in effect, a mandated restructuring, do you have a feel for how likely judicial review challenge would be?

The only, I think, guide we've got, really, is if you look at the English local government reviews in the early to mid-1990s, there were quite a few applications for judicial review. There was Avon, I think, which sought one, Somerset sought one and I think some of the north-eastern counties sought judicial review. And that, really, took up a lot of time and money of the then Local Government Commission for England, not to mention time and money on the part of the counties involved. 

Just one further matter, under the provisions relating to your powers to carry out a special inspection, Welsh Ministers may request you to consider whether a particular principal council may or may not be meeting performance requirements and to carry out a special inspection. How does that relate to the matters we've just been discussing, would you say? 

Notwithstanding the link, which I suppose adds to the perception that this is a precursor to considerations on restructure, i.e. Ministers may request a special inspection, councils receive that request, because they'll need to be consulted, as a red flag towards potential restructure. That leads to, as we said, less co-operation with our special inspection and a perceived link in terms of its findings and any considerations around restructure. So, I think, as we've already discussed, the link there is problematic. If the link were removed, I think that's a perfectly reasonable thing for Ministers to do. Councils have a set of performance requirements that they need to adhere to. As an external review body, it's perfectly appropriate for Ministers to request that we consider whether councils are doing that, notwithstanding that we'd already be doing that anyway through our powers to look at a proper arrangements duty on an annual basis. But if there were a particular concern, it would be appropriate for Ministers to make that request.

11:20

Okay, thanks for that. A couple more questions from me and then we'll move on to Caroline Jones and conclude this evidence session. Just going back to performance and governance, and section 90—the duty of principal council to report on its performance—could you say a little bit more about your concerns with provisions in section 90 and how these might be amended or strengthened so that we had a more robust framework for self-assessment? Because I know you've said that you have concerns around self-assessment.

Sure, yes. I think, in principle, we welcome a duty to keep performance under review, so that requirement there is a positive one. Self-assessments aren't new, they've been around for quite some time in various pieces of legislation relevant to local government in terms of the best value Act and also the local government Measure. So, they're not new. I guess what we've seen over the time and the lengthy experience that we've had is that self-assessments, particularly when they become published reports, tend to be quite selective, and in general, overly positive. I think that's a general theme.

Back in 2014, I think it was, we published a report around the local government Measure and those requirements for self-assessment and publication of reports on performance, and we were finding that not enough use was made of available performance information, even less use made of comparisons with others. And there was this tendency to be selective and not present a clear enough picture to the reader and, indeed, the electorate and Ministers, about the performance of the council. I don't think things have improved; in fact, in some cases, they've probably got a little bit worse. We no longer have a set of statutory indicators in local government. The mandatory nature of those were withdrawn a couple of years ago now, so there's no requirement for local authorities to report on a set of indicators. There are voluntary mechanisms in place through Data Cymru, but because of that mandatory nature, some of those comparisons can no longer be made.

I think the effect of previous White Papers, going back to 2015, flagging the repeal of the Measure, perhaps didn't help because, then, these requirements are going away, we don't have to be as thorough or as comprehensive as we might be. I don't think things have changed since 2014; I don't think they've got any better, and in some cases, potentially worse. What I would say, though, is that the requirements in the Bill are more comprehensive and appear to me to be more coherent than the requirements in the Measure in that they don't only talk about performance in terms of meeting objectives, but they do talk about discharge of a duty, economy, efficiency and effectiveness, and also, they talk about governance arrangements. There's a potential that those assessments are more rounded, so that's a real positive. A caveat to that is that there are already requirements to report on governance through annual governance statements, as required by audit and accounting regulations. What we are finding is that those annual governance statements are more a statement of what arrangements are in place rather than how effective they are. So, I think there is a need to up the game in that respect.

Another positive that we do find, though, is that the self-assessments will be made available to governance and audit committees as a matter of course, and those governance and audit committees will be required to review them, and councils respond to that review. So, I think that is a real improvement on previous legislation.

The second part of your question is how we might suggest that those provisions are amended. I guess that, rather than on the face of the Bill, learning the lesson from the local government Measure, the guidance needs to be pretty comprehensive and clear for councillors as to what is expected through self-assessment, rather than leave it very open, in which case, I suspect, we won't get a consistent discharge of this across local government. 

11:25

Okay, well, that's very helpful. Thanks for that. So, a final question or two from Caroline Jones.

Diolch, Gadeirydd. Regarding the co-ordination between the regulators, do you think the provisions in section 118 of the Bill provide additional benefits that cannot be catered for through the existing arrangements?

I don't think they provide any additional benefits, because the existing arrangement—this is pretty much transposed from what's in the local government Measure as is. But we think having a provision around co-ordination is fine. It's the right thing, it's a desirable thing for us to co-ordinate as a group of external review bodies.

What I would say is that there are already voluntary, if you like, mechanisms in place. We have a strategic agreement through something that we call Inspection Wales for co-ordination and co-operation across ourselves, both strategically and operationally, which works well.

I think the one requirement that we, in hindsight and through our experience, would comment on is the requirement to produce a timetable. Now, the practical nature of that is difficult, and one of the principal reasons is that our colleagues in Estyn and Care Inspectorate Wales work on a notice period. So, invariably, when we produce a timetable and furnish it to a council, it says 'to be confirmed', because we can't tell them. The other matter is that what we attempt to do through our annual programme of work at councils is to be agile and responsive to events. And our annual programme may flex, so producing a timetable at any one given time—that may change, timings may change. The logistics of continuing to maintain that are not always helpful, and, in fact, we find the majority of our councils say, 'Look, don't give us a timetable. We've got quarterly meetings set up with you. You report to the audit committee on a regular basis; that's sufficient.'

Thank you. There are concerns in the auditor general's paper related to the Assembly's legislative competence in relation to section 118 of the Bill. So, can you elaborate, please, on these concerns?

Yes. The Government of Wales Act 2006, as amended, provides protection for the auditor general's independence provisions in the Public Audit (Wales) Act 2013. Section 8(1) of the 2013 Act says that the auditor general has discretion in the exercise of his functions and is not subject to the direction of the Welsh Government or the Assembly. Now, that section really negates the 2009 Measure, saying that the auditor general must have regard to the need to co-ordinate his work. Now, this Bill is reintroducing that requirement, and that means that there is, effectively, an amendment of section 8, because section 8 says he can't be directed, but then, by implication, he's being required to co-ordinate with other inspectors. Well, that is—

11:30

It's certainly ambiguity, yes. And that does call into question whether that provision of the Bill is within competence, because it would seem to fall foul of the protection of section 8 of the Public Audit (Wales) Act 2013.

Obviously there's clarification needed as to which is correct, really. Thank you.

Okay. Well, if Members have no further questions, thank you very much, both of you, for coming in to give evidence to committee today. You will be sent a transcript to check for factual accuracy. Diolch yn fawr.

Our next evidence-givers are not present at the moment. They are? Okay, fine.

5. Bil Llywodraeth Leol ac Etholiadau (Cymru): Sesiwn Dystiolaeth 5
5. Local Government and Elections (Wales) Bill: Evidence Session 5

Okay, we move on to item 5 on our agenda, which is a further evidence session on the Local Government and Elections (Wales) Bill, and I'm very pleased to welcome Sophie Howe, Future Generations Commissioner for Wales, and also Heledd Morgan, who I believe is a change maker with the commissioner.

That's right.

Thank you very much, both of you, for coming in today. Perhaps I might begin with a question on the general principles of the Bill, which is whether, commissioner, you support and welcome those general principles.

Yes, I welcome the general principles of the Bill. I think, as with anything, the devil is in the detail, and I've got some concerns about the detail, which I'm sure we'll come on to. But I think that the broad areas of coverage around participation, around collaboration, and so on, fit in broad terms—and I would say 'broad', but that's where it comes down to the devil being in the detail—with the Well-being of Future Generations (Wales) Act 2015.

Thank you. I wonder if you can tell us the extent to which you consider that the provisions aimed at improving diversity and participation in local democracy are sufficient within the Bill to have the required impact, please.

I think that there are obviously some—. The most exciting provision is around the votes for 16-year-olds, which is excellent, so I very much welcome that. I think that the Bill takes us—perhaps I should use the term 'procedurally'—in the right direction, but I'm not sure that it gets to the root of the problem in terms of participation. And I think that, potentially, there are some missed opportunities to align with the well-being of future generations Act. So, here, for example, we can see the use of the word 'participation' but, actually, the future generations Act requires 'involvement'. I know it may seem like semantics, but I think it is a bit of a different thing. 'Involvement' in decision making in accordance with the future generations Act conveys a much deeper, earlier and more meaningful involvement of citizens earlier on in the process. The provisions in this Bill I think are more focused towards participation in decisions where they're at the point of being taken, and I'm not sure that—. So, where I think that there's a missed opportunity is around that kind of earlier engagement.

Some of the examples that perhaps I could point to around where the Bill could be strengthened and other examples—. So, Scotland have got the Community Empowerment (Scotland) Act 2015 that clearly states this method for—. Well, it's a requirement on public bodies to involve citizens at an early stage. I don't know how much the committee might know about the community empowerment Act. It was passed in 2015. It basically provides a right to citizens to request to be involved in a decision-making process at any stage in that process, and a duty then on the public body concerned to have to find a way to involve that citizen or citizens' group, or whatever it might be, in the decision-making process wherever that might be most effective. So, it could be, for example, by asking them to join a scrutiny committee or an existing partnership. It could be through targeted focus groups around a particular issue. It could be around keeping them informed and updated, and so on. So, I think that there are perhaps some opportunities there that this Bill could pick up on through that earlier engagement, and focusing on the involvement principle rather than 'participation'.

There are a few more points that I could make if you've got time. 

11:35

Yes, I'd love some more examples if you've got them. The one you've given is excellent, but if you can give us some more ideas for strengthening this aspect, it would be great. 

Okay. So, I think that there are some issues here. I completely accept the point that there's only so much you can do in legislation, but I think that there is a tendency often for Governments to legislate for things to happen and, 'There we are, we've given you the legislation and off you go, and all the problems in the world are going to be solved', and without really clear guidance and support, and particular support for cultural change, I think sometimes legislation doesn't do the job that it was intended to do. So, things like enabling a wider number of local authority employees to be able to stand for election—I think that's a really good move in the right direction, but there's a whole plethora of other people who have real barriers in terms of standing for election for a whole range of reasons, not necessarily procedural; often, they are financial reasons—people who can't afford to take time off from their place of work, and so on. Now, I appreciate that that might not be something that could be covered within this legislation—I don't know whether there are innovative ways of being able to do that—but I think that is more the nub of the issue, perhaps, than just a procedural change in terms of which local authority employees can stand. 

There's provision around job sharing for leaders and executive members. I think that's, again, a move in the right direction, but what about backbench councillors? And I think there are some interesting things, again, around the family absence provision. I've had a technical briefing from officials and questioned them on this point in particular—so, the covering of maternity leave and paternity leave and adoption leave, and so on, for councillors. As I understand it, the provisions are going to extend for maternity cover to be by another councillor. Now, I'm not sure whether in practice—. I've got personal experience of this; that wouldn't have worked for me at all. I can't see how councillors, particularly if we're looking to increase the diversity of councillors—. So, ideally we've got a scenario where we've got younger councillors, people who are working in other jobs and people who've got family commitments. It's enough to do taking on your own role as a councillor, let alone covering someone else's maternity leave with no additional benefit. From my personal perspective, and from people in a similar position to me when I was a councillor, what would have really benefited me was actually having some paid support to do my casework, or what have you. Yes, other councillors can probably vote for you in council, and those sorts of things, but, again, I would say that the vast majority of councillors, the vast majority of their work, is their ward-based work, and I'm not sure these provisions get to that.

I think then there's perhaps a missed opportunity around the structures. And what I'm talking about here is how—and I'm sure you'll get on to views on the proposed structures in terms of these new regional committees—. But I don't think you can divorce the establishment of those structures from the ability of people to participate and get involved. And I think what we've got at the moment is already a really complex landscape, where it's really difficult to see who takes decisions where. And if we want people to be involved and engaged, and actively get involved in decision making, they've got to be able to understand that system. So, whilst I don't—I have some issues, which I'll perhaps go on to later, in terms of these committees—have a massive problem with them per se, but I do think there's perhaps a missed link between creating more layers and how that might impact on public participation and involvement and transparency. Perhaps that's something that could be dealt with through guidance and regulations. Perhaps that's something that could be dealt with, for example, through following the model of the Scottish community empowerment Act, but I think it's perhaps something that's missing at the moment. 

11:40

Just one small question on the Scottish community empowerment model, doesn't that duplicate what should be happening anyway under the future generations Act? So, why would we do that if it's already in place, and what we need to make sure is that it's implementing what we've already put in place?

I think you raise a really fair point. I suppose what it does is put in place a really clear kind of legal procedure that has to be followed to ensure that that happens. The principle in the future generations Act is the duty to involve people who have an interest in achieving the well-being goals, and so on. I've issued guidance on that, and I'm currently considering my future work plans, and whether I go in to have a look at how that guidance is being followed, particularly around involvement. And I suppose there's always this balance, isn't there—the community empowerment Act, I think, on the face of it, is really good, but, again, back to the point I was making, it's still legislation, it's still a procedure that's got to be followed, and so on. 

We were looking at some of the evidence around how effective it's been, and there has been some research on that, which seems to suggest that people do feel that there are more opportunities to be engaged. There are still some issues around how the procedures are being used. So—and this is a prime example of what I'm saying in terms of culture—some local authorities will just follow the letter of the law and do the bare minimum. Others, where the culture is about involving citizens, will take it to a different level, and those are likely to be the local authorities where they're actually getting more out of it. 

The other thing that was picked up through the research is, because the provisions in the community empowerment Act require individuals or community groups to request this kind of participation, there are potentially issues around widening the inequality gap, because it's those who know the system, those who speak loudest, and so on, making those requests. But I still think it's something that perhaps could be considered, should be linked under the well-being of future generations Act—'Look, you've got this duty to involve already; here's a local government Bill, which actually, perhaps, from a local authority perspective, puts more meat on the bones of that.' But, I think consideration would have to be given to some of those issues. And, as I always go back to, it's about the support and the guidance, and the support for cultural change, that has to come with that. 

Thank you, Chair. Good morning. What, in your opinion, are the possible benefits, or the potential impact of creating the corporate joint committees on service delivery and long-term sustainability of those services? I know you kind of touched on that a little bit, but perhaps you could just expand on that a little bit in terms of your thoughts.

Okay. Well, I think anything that brings different elements of services together to work in a collaborative way is a move in the right direction. I think, however, that they're a bit of a random selection of services and functions to be brought together. Everything is linked to everything, so I'm not against it, but I think it's more on the basis of what's already emerging at the moment, and the structures and functions that perhaps might be moving in that direction are proposed to come in to this, rather than, 'Okay, if we were to develop a sensible approach to one public service, what would that look like?'

11:45