Pwyllgor yr Economi, Seilwaith a Sgiliau

Economy, Infrastructure and Skills Committee

18/11/2020

Aelodau'r Pwyllgor a oedd yn bresennol

Committee Members in Attendance

Helen Mary Jones MS
Joyce Watson MS
Russell George MS Cadeirydd y Pwyllgor
Committee Chair
Suzy Davies MS
Vikki Howells MS

Y rhai eraill a oedd yn bresennol

Others in Attendance

David Roberts Cadeirydd, Partneriaeth Sgiliau Rhanbarthol Gogledd Cymru
Chair, North Wales Regional Skills Partnership
Huw Wilkinson Rheolwr Partneriaeth Sgiliau Rhanbarthol, Partneriaeth Sgiliau Prifddinas Ranbarth Caerdydd
Regional Skills Partnership Manager, Cardiff Capital Region Skills Partnership
James Price Prif Weithredwr, Trafnidiaeth Cymru
Chief Executive Officer, Transport for Wales
Rachel Clegg Cydlynydd Datblygu, Partneriaeth Dysgu a Sgiliau Rhanbarthol De-orllewin a Chanolbarth Cymru
Development Co-ordinator, Regional Learning and Skills Partnership South West and Mid Wales
Richard Tobutt Rheolwr Partneriaeth Sgiliau Rhanbarthol, Partneriaeth Sgiliau Prifddinas Ranbarth Caerdydd
Regional Skills Partnership Manager, Cardiff Capital Region Skills Partnership
Sian Lloyd Roberts Rheolwr, Partneriaeth Sgiliau Rhanbarthol Gogledd Cymru
Manager, Regional Skills Partnership North Wales

Swyddogion y Senedd a oedd yn bresennol

Senedd Officials in Attendance

Francesca Howorth Ymchwilydd
Researcher
Lara Date Ail Glerc
Second Clerk
Phil Boshier Ymchwilydd
Researcher
Robert Donovan Clerc
Clerk
Robert Lloyd-Williams 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.

Cyfarfu'r pwyllgor drwy gynhadledd fideo.

Dechreuodd y cyfarfod am 09:44.

The committee met by video-conference.

The meeting began at 09:44. 

1. Cyflwyniad, ymddiheuriadau, dirprwyon a datgan buddiannau
1. Introductions, apologies, substitutions and declarations of interest

Croeso, bawb, i Bwyllgor yr Economi, Seilwaith a Sgiliau.

Welcome, everyone, to the Economy, Infrastructure and Skills Committee.

I'd like to welcome Members to committee this morning. In accordance with Standing Order 34.19, I've determined that the public are excluded from the committee meeting in order to protect public health, but this meeting is being broadcast live on Senedd.tv and can be watched back. The Record of Proceedings is available in the normal way. Should there be an issue with my connection, it's previously been agreed that Joyce Watson will stand in as the temporary Chair. We're not aware of any apologies or substitutions this morning. I should say that sometimes some Members do not always appear on screen because there are some connectivity issues with some Members joining. So, just be aware of that also. If there are any declarations of interest from Members, please say now.

09:45
2. Papurau i'w nodi
2. Papers to note

In that case, I move to item 2. There are just a couple of items to note. Under 2.1, we have a letter from the Chair of the Children, Young People and Education Committee regarding the Welsh draft budget, which is there for Members to note. And then there's 2.2, which is a letter from the chief executive of the Development Bank of Wales regarding COVID-19. The letter was referenced last week during the evidence session, so it's published there for information also. Are Members happy to note those two papers? Lovely. Thanks ever so much.

3. Trafnidiaeth Cymru: Gweithredu gwasanaethau rheilffyrdd Cymru a'r Gororau
3. Transport for Wales: Operation of Wales and Borders Rail Services

In that case, I move to item 3. This session is predominantly to discuss the announcement that was made on 22 October. It seems a long time ago now, but time moves quickly at the moment, with different discussions on different areas. It's also, I think, an opportunity, as well, for us as a committee to discuss wider areas with regard to Transport for Wales's functions and the implications for the Welsh Government more generally with regard to some of the proposals that were announced on 22 October. So, I would like to welcome back to committee again James Price, the chief executive of Transport for Wales. Thank you, James, for being with us this morning. If I could perhaps just ask first of all a very general question: can you give us an update on the current operations within Transport for Wales, particularly since July, when you last came into committee, with regard to how the pandemic has affected services and your operation? And perhaps you could also go further than the current situation and tell us a little bit about the months ahead as well.

Thank you for inviting me and giving me an opportunity to talk to you. I guess, in answering this question, I'll focus, in the first instance, on rail, and then if you want to take it wider, you can do as well. But I think the biggest challenge for us has been in the rail space, albeit, as you know, we're increasingly supporting Welsh Government in the bus space as well, which has had, basically, the same set of issues. So, none of this will be a surprise to you; you will have heard it from other people before, and you will have seen the data. And the data is true.

In essence, once the COVID-19 pandemic hit everyone, it affected Transport for Wales in the same way that it affected nearly everyone else, and revenues and passenger usage dropped significantly. In the first couple of weeks, they dropped by about half, and then it fell to about a 90 per cent drop. It held there until the beginning of the summer period where lockdowns began to be relaxed, and we saw quite a varied picture at that point. So, probably services got back up to maybe 40 per cent of where they were before, which was about as high as they should have been, really, on average, given the social distancing requirements. But some services saw much less demand than that and some services saw more demand than that.

As a result of that, we have introduced various things like a capacity checker tool to encourage people to look at how busy a service is before they choose to take that service. We've also built a ticketing option that you can choose to book a service, and that can become mandatory. That's on trial currently as well. So, that kind of 40-ish per cent carried on all the way through into the latest lockdown position where we've seen numbers drop, not quite as far as they have done before, actually, but, again, I think this is in line with the rest of society.

So, in the last lockdown, I think we were probably somewhere in the region of 10 per cent to 15 per cent of where we were pre COVID, and then, coming back out of that, it's beginning to grow back up again as it was before, and in some services, we are seeing quite high growth. The interesting thing we're seeing, and I think this is interesting from a transport perspective, is that there's higher growth for leisure travel than there is for commuting. That says to me there must be a group of people who feel confident and relatively safe in using services, because leisure is, obviously, a discretionary activity vis-à-vis work, where if you have to go somewhere you don't have that choice.

09:50

Thanks, James. Last month, in Plenary, the Minister said that performance was improving very significantly under KeolisAmey. But I'm also aware that, as of January 2020, the company had incurred penalties of £3.4 million in 14 months. I'm just trying to square the two, really—and your views on that. Also, if we are talking about improvement, is that simply as a result of less demand for using the service? In other words, if you've got no customers, then potentially some of your indicators are going to show that you're perhaps improving in certain areas.

That's an absolutely fair point you're making. So, if I go backwards in time now, from COVID and then before, through the COVID period, if you don't have any passengers, in theory, it's a lot easier to run the service, and indeed the figures have looked pretty good through that period. But, I guess, in a way, that's nothing to celebrate. It would be very worrying if we weren't—albeit there have been two issues that we've been battling, and I think KeolisAmey, together with us, have battled quite well.

The first is the normal autumn wheel-slip issues that we've seen before. You've scrutinised me before on that, and, of course, autumn hasn't changed. We're still running pretty much the same number of commuting services, particularly in and out of the Valleys, simply because it's very difficult to cut them, and, therefore, those services would have been affected by the same weather. The good news is that the autumn protection that was fitted has worked. We've basically had very few units out as a result of that, which was the plan. We were always a bit worried about whether it would work, but that was the plan.

The second issue that we have been battling is, obviously, keeping staff healthy and safe when they're working, sometimes in confined spaces. Obviously, the main reason for that is to keep staff safe; the secondary reason is if people have to self-isolate, obviously, the service would be impacted. So, that has performed quite well as well. So, I think there are two positives in there.

But if we go back before the COVID period—I think this is what the Minister would have been referring to—we had seen, as I would describe it, a series of green shoots about performance improving. So, particularly, we had seen a reduction in what we call short formations—that is, if it is meant to be a six-car unit, it going out as a four, or a four going out as a two. We had seen a significant reduction in that. We had also seen an increase as a consequence in capacity. A long time ago now in terms of what's happened in the world, but just before COVID, we had increased the capacity in the Valleys area, for example, by about 6,500 spaces every week. So, I would agree with the Minister; we had seen some improvements before, and those improvements have continued into the COVID period.

Thanks, James. It will be helpful, perhaps, for other questions that are coming down the line later on—but in terms of the announcement on 22 October in terms of the operations reverting to public ownership, can you just talk a little bit about the internal processes that led up to that within Transport for Wales? I appreciate it's a big question, but try and be brief, because there are a lot of questions to get through, so—.

09:55

Okay, no problem at all. What I will try and do on this—. I need to be a teeny bit careful because we haven't closed out all of the agreements, so I will try and be completely free and open about the principles, the law and the public policy drivers behind it, but I will not quote figures at this stage. I think that's probably the best thing to do, because they haven't done—[Inaudible.]—yet.

So, the background to all of this is no different in Wales than it would be in England, Scotland or any other part of the UK that was using the franchising system that was set up at privatisation. Now, this is a neutral comment on franchising that I'm about to make, just to be really clear, but franchising was set up not for a COVID pandemic, and if you go across the UK, you'll see a mixture of different franchises, some of which bring money into the Exchequer, some of which are very heavily subsidised, and the Wales franchise is towards the more subsidised end, and that's because, for a long time, public transport in Wales has been viewed as a public good, and because of the demographics—we don't have a massive city like London where you can charge people £200 to £300 a ticket to go into it. So, that's the reason for that.

It's an important point, though. So, half of the money that comes in through the franchise, roughly speaking, comes in through ticket sales, and the contract was set up, obviously, therefore about half of the money that was going to be invested in the future was coming from Government, and half of the money would come through ticket sales. The sad fact is that the contracts under the franchise system—and probably any contract, to be fair—did not have the variability within them to be able to stand up to the level of change in revenue that we have seen. So, simply put, if that contract was to be tested in court, and we were paying the 50 per cent that was meant to come in through the passengers through Government subsidies, it would be heading towards null and void, and in any event, it would be poor value for money for the public and for the fare payer. So, KeolisAmey recognised this, and there was some discussion about what the right approach was, and I think, to be fair, probably the operator would have preferred to kick the can down the road just a little bit further than we have done.

Now, in England, the situation is a—

But the operator, KeolisAmey, would have preferred, potentially, for the announcement on 22 October to have been later on.

At the beginning of the process, yes. I'm being really open about this. At the beginning of the process, I think they would have preferred that we carried on with the emergency support, and they were hoping, as I think probably everyone was at the time, for a very quick resolution of this, with everything going back to normal and then we could—[Inaudible.] Now, obviously, as time went on, that didn't happen, and the big difference between England and Wales is that most of the English franchises are coming to their end, and they don't have a big investment programme associated with them. We're right at the beginning and we do have a big investment programme associated with ours.

The big feature of being in this kind of COVID situation from a contractual perspective is that everyone in the operation is focused on: will they get the money they need out of Government to pay the bill next week, and are they going to have a job in two months' time? And everyone within Transport for Wales is making sure, quite rightly, that all the invoices that are presented are the correct ones to pay. So, the big, big danger in all of that is that no-one is focused on putting a really good service out; no-one is focused on delivering the metro; no-one is focused on delivering that new rolling stock, all of which, don't forget, runs into over £1 billion-worth of public expenditure. So, our board concluded that we needed to reset the contracts, because there was no way, when we went through the set of analysis with lawyers and with accountants, there's no way that we could ever come back to the existing contract. So our board's very strong view, very strong recommendation to the Welsh Government, was, 'Reset it now, as soon as you possibly can, so that you can get everyone back focused on delivering the servic, and delivering metro, and introducing new rolling stock'.

Out of interest, when did your board decide that? That must have been pre—[Inaudible.]

10:00

Pretty early. I would need to check minutes and write back to you, but probably within two months, I would guess, of the beginning of the COVID pandemic. Because by that point, it was becoming clear that you could not go back to the existing contracts. As soon as it was clear that you couldn't go back to the existing contracts, you have to do something different. Then, just to be really quick about this, because I know you want to get through lots of other things, we went through a staged process of testing all the different options that were available to us and, frankly, there are quite a lot, but they are different flavours of the same thing. We did cost-benefit analyses and legal analyses and worked with the Welsh Government to understand what their policy view was on different things as well, and then ended up with the recommendation that we have. And, as part of that, we've gone through a pretty detailed and sometimes difficult negotiating process with Keolis and with Amey. I think everyone has been very professional, but by definition, different people have got slightly different views, even within that partnership. But it feels like we're heading to a place that everyone is comfortable with, and we believe it's a way through the pandemic and to retain as much of what we started with as possible. 

And on that last comment from you, James, it would be interesting just to understand the relationship between you, the Welsh Government and KeolisAmey during the process that you've talked about, up until when you made the decision. How would you describe the relationship between the three different parties?

The relationship between Welsh Government and KeolisAmey is through Transport for Wales. It's been set up like that. We are the Welsh Government's agent and, just being very honest, I've been at pains to keep it like that, because in terms of negotiating, the last thing I want is for someone to be able to go around behind me and say, 'James is being too difficult here; we want a better deal.' And, to be fair to the Welsh Government, they've absolutely adhered to that, so—

All negotiations took place between you, or Transport for Wales, and KeolisAmey, and Welsh Government weren't involved in that process—only with you. 

That's right, yes. And I think that's good and proper, and that's how it was set out to be. I suspect that there were attempts to go around the back, there always are, but they didn't work, so that's good. And in retrospect, I think everyone would say that that was the right thing to do, on all sides as well, actually. 

And what about the relationship between Transport for Wales and KeolisAmey during the period through these discussions up to the decision date?

I would describe it as professional. I think everyone has tried to do the right thing. I think, at different times, everyone has got very frustrated through the process, but only for a short period of time. I think, at different times, everyone has thought that all the other parties are being unfair or trying to push their point too far, but what I would say is that everyone, including the senior execs in KeolisAmey, has acted with integrity, and they've acted with professionalism. So, even when we've had some big disagreements, they have been professionally handled and not handled in any bad way—[Inaudible.]

No, no, I think you're saying it was a professional relationship between the two parties but that there were some disagreements, and significant ones, as you might expect during a negotiation, but they remained professional, and I think that's what you're telling us. So, no; understood. Thank you, James. Vikki Howells. 

Thank you, Chair. I'd just like to explore the mechanics of the transfer of rail operations to the new public sector operator. I'm particularly interested in the Minister's comment that it would be necessary to acquire certain assets from KeolisAmey to ensure the smooth transition and the ongoing provision of servicing. 

Okay, so, the mechanics that we are going to use are tried and tested, I guess you might call them, and they're within the provisions of the original privatisation framework and within the Railways Act 1993. They're called 'operator of last resort'. We won't be using that a lot publicly, because it probably doesn't necessarily lead to a lot of public confidence: 'What are you doing?', 'Oh, we're the operator of last resort; we've tried everything else and it all went wrong, so you've got us.' We won't be saying that, and, actually, England, where they have done this, even under the existing Government, are not publicly describing it as 'operator of last resort', but that is what it's called.

In essence, what happens is the same thing that happens when a franchise transfers from one franchisee to another, apart from that it transfers to the public sector. So, Transport for Wales has set up a subsidiary company. It's dormant; it's not trading at the minute—Transport for Wales Rail Ltd. That company will receive all of the contracts and, in essence, all of the staff through a Transfer of Undertakings (Protection of Employment) process, of the existing operator at midnight on 6 February. That's the plan next year. And the staff will carry on as they did the day before, in essence, which is how a franchise change happens.

Now, that doesn't mean that we have to make no changes at all. I think we will be making some changes because this does provide us with an opportunity to slimline some of the administration that we do, and, therefore, put more people's focus on front-line delivery. But the process is OLR transferring activities from one company to another, and the assets that we need to buy are assets that KeolisAmey would have bought as part of the transfer from Arriva Trains Wales to KeolisAmey. Now, it's a slightly different list, obviously, because some things have been written off since then, and some other things have been invested in, but it will be things like ticket machines, software programmes, IT and some other aspects. Again, we can write to you on that, but it's a normal process; we're not doing anything different.

I guess, to be very upfront, the one thing that we are doing that's a bit different in this OLR to what has typically happened in England, is again, England, I think have tried to do what we are attempting to do here, which is to have a managed transition. And that is why it was such a difficult negotiation, because we, in essence, tried to get the best deal we possibly could out of the private sector operator, which costs them money—they don't like that, obviously—so that we can have a date in the future, and we can do things gradually and properly. In England, what has tended to happen—and I don't think it's anyone's fault; I think it's serendipity, or bad luck, actually—is that the operator failed to strike a deal with the UK Government, the operator trades into insolvency, and then the new company steps in just at the point that all the money runs out. Now, the problem with that, from our perspective, is that we could have possibly gone for four months with no-one really managing the Valleys lines upgrades, no-one really managing the rolling stock improvements, and then, we could, potentially, have a white elephant of a metro that's built not to standard, and a new series of rolling stock that won't work on our tracks. So, we really wanted to, and still want to avoid that. 

10:05

Thank you. That's very, very useful indeed. The Welsh Government has said that there's not going to be a contract through Transport for Wales Rail Ltd, but that the relationship's going to be managed through Transport for Wales's governance arrangements instead, like its remit letter. So, how will that work in practice? Will Transport for Wales effectively be both operating services and overseeing their delivery?

I guess it depends which way you look at this, and I think that you are bound to have me back to scrutinise me on this in the future, and how we deliver against however it's set up.

But, in principle, whilst we will not have a formal contract, we will have to have a service agreement between the Welsh Government and either ourselves or the subsidiary. In terms of the way we're going to work with the subsidiary though, we intend to operate it as one entity—Transport for Wales and that subsidiary—so it doesn't really make any difference whether it's between Welsh Government and the subsidiary or Welsh Government and Transport for Wales. But there will be a service agreement, which is a bit like a contract, so, it will have within it the services that we're meant to be delivering, timetables and the performance metrics. Aligned with that, there will be a new series of key performance indicators that will be published, that Welsh Government will want to see; they'll be publicly available for the public to scrutinise us on, which will probably be greater scrutiny than we've had in the past. And then, because we run services in England as well, we will have a similar arrangement with the UK Government, through a services agreement with them. Shall I pause there? I could go further, but—

10:10

I'm happy to pause there. I think Suzy wanted to come in with a question.

Yes, thank you. Nice to meet you, James; this is the first time I've been on this committee and spoken to you. Can you tell me where the remit letter fits in with this service agreement? They sound like they are different things, but can you just talk us through that, particularly me, as I'm new to TfW?

Yes, absolutely. I think the first thing I should say, I can talk about where we've been to date, but this is still slightly evolving, and we've got to reach agreements with the UK Government and with Welsh Government about exactly how this works. So, whilst in broad terms what I've said is absolutely correct, there's some leeway or wriggle room in terms of how we could do it.

But broadly, I would see that the remit letter will set out how much money the Welsh Government is giving us, and what they expect to see for that money. Now, the Welsh Government ambition, and our board's ambition, would be that that moves to be as strategic as possible and cover the longest period as possible, in essence, so that we can become as efficient as we can do by being able to plan over a longer time period. I don't think the remit letter will specify the level of detail in terms of rail services that the rail service agreement would specify. So the remit letter will probably simply say, 'You have X amount of money', or, 'up to X amount of money'—because I think there'll be efficiency targets built into it—'for running rail services over this time period, and the services that you're going to run, and the quality to which you're going to run them are set out in the rail services agreement'.

Okay, thank you very much for that. Thank you, Vikki.

On the remit letter, James, is the current remit letter covering this period of time—can you just confirm?

You've obviously been doing your work very effectively.

Yes. We have a new remit letter now. So I am in receipt of a remit letter in the last few days. That remit letter, when I checked this morning, wasn't yet on the Welsh Government website—it may be on there now, because we were all very well aware I was being scrutinised. In terms of any—. Clearly, it's good practice—well, more than good practice; we should have a remit letter, absolutely.

The existing remit letter that's published, that goes up to what date? It was past that date, I think, wasn't it?

The existing one that you will have seen has run out, yes.

It has run out, right. So, usually, you'd put a remit letter ahead of the period of time that it's relevant for, but at the moment, we're in a period where we haven't got a remit letter. But you think that's been approved, and it should shortly be on the Welsh Government website.

Well, I've got one. I am in receipt of one; it's been backdated. So, from a pure governance perspective, it's okay. I think there were reasons why Welsh Government wasn't able to give us a remit letter, which were mainly to do with COVID and uncertainties around funding, because we didn't know, from month to month, obviously, what restrictions there were going to be, and therefore how much money we were going to get. We did put in place other solutions to that. So, there was a separate letter to our board, to give them—

Right. Can you send us a copy of the remit letter, if you've got it?

Yes, absolutely. And if you don't mind, I'll put a covering letter with it, explaining how we were operating in the period where it was unclear what budget we needed.

Thank you. I'll come back to Vikki. Vikki Howells. Do you have any further questions, Vikki?

Yes, I do. So, thinking about underperformance, going back to last year, KeliosAmey was fined, wasn't it, for its underperformance? Now, that was difficult enough to explain to my constituents then—they'd say to me, 'Well, the Welsh Government is fining itself, surely'. So, under the new set-up that we're going to have, how will that system work there? How can the new approach incentivise innovation and good performance as well as penalising underperformance?

10:15

I guess, in essence, I'd like to just take a step back in answering that question. So, the reason that there are penalties and bonuses in a contract with a separate private sector organisation is an attempt to encourage people to behave correctly. And there are books and books and books written on whether it works and whether you're aligning the incentives and the penalties in the right way or whether you're creating perverse behaviours. But I think what we had set up was, at the time—because we had it peer-reviewed—approaching what was described as 'best in class' in terms of incentivising the right behaviours. However, any private sector organisation will know that they are likely to be fined in going into a contract and will therefore bid that fine into the price. 

Ideally, if you didn't have to do it that way, you wouldn't do it that way. And if you think about any organisation that you work in, normally, performance management is done by modelling good behaviour by leaders, by people encouraging good behaviour, by having a culture that says that you want to improve all the time—not by docking people's pay if they perform poorly or giving them big bonuses if they perform really well.

So, the culture that we've tried to build up in Transport for Wales—the part that I line manage, if you like—is not based around a bonus culture at all; it's based around the board, the senior management team and the whole organisation, actually, trying to model good behaviour and wanting to be the best—that's one of the values now.

Quite legitimately, you might say, 'Well, James, we've not seen Transport for Wales be the best yet', but that doesn't stop that being our ambition. So, we don't think we need to be fining people or 'bonus-ing' people in the future. What we think we need to be doing is building the best possible team, setting them really clear objectives and then having even greater transparency with the public, with the press, with various committees and with the Senedd, et cetera, in terms of scrutinising.

And just speaking very personally, if I had £3 million of someone else's money to pay to someone if I'd performed badly, that's probably a lot easier to do than to be plastered all over a newspaper, with everyone saying what a bad job you've done for your neighbours. So, yes, it's a bigger test. We're absolutely not wanting to bring British Rail back or a lot of things that people say about poor performance culture or being an organisation that doesn't care. We want to use both the public saying, 'You've done a really good job' and the public saying, 'You've done a poor job' to motivate people to do the right thing.

Okay, thank you. I've got one final question: the Minister has talked about difficult choices that will have to be made about resource availability, operational costs and the potential of continuing to offer a reduced service. What does that mean and are there any concerns that the commitments that are currently out there for improvements in Welsh rail services, including the current franchise agreement, could possibly be in jeopardy?

Okay, if I answer that in three blocks. So, I'll start with the good news and then work backwards through bad news into good news again, I think.

So, the good news is that the new rolling stock, which was ordered, in essence, has reached a point where we can't send it back. So, that's baked in and, in any event, because we've got such old rolling stock, a lot of it becomes illegal over the next few years, so, we need new rolling stock. So, we will be part of the UK that has some of the newest rolling stock in terms of a service outside of London. London always seems to have the best, but, in terms of a service outside London, we will be one of the best in terms of that, very shortly, and that's baked in. The metro is also baked in; that's not going to change. I think that's the good news.

The difficult piece—. If I take you right back to what I started talking about at the beginning, which is that half of the money for the investment comes from ticket sales. Now, in the absence of those ticket sales, either we need to get better at selling tickets, which is where I'll come onto in a minute, or the Government needs to step in. It's not for me to say what future governments will do, and it probably is future governments, not this Government, but public transport, if we cannot get revenue back quickly, will be pitching itself against other services—education and health et cetera.

For me, though, the real opportunity is probably to try and be more—and this might sound bonkers, and it may be proved to be bonkers in the future—but why can't we try and be more ambitious than we even were under the KeolisAmey contract? And I think there's some rationale for what I'm saying. I don't think it's completely off the mark. So, rail use in Wales is only about 3 or 4 per cent of the entire transport. Now, my guess would be, if you were selling a product—. I saw a talk by someone who sold iced coffee last night on YouTube, I must have been very bored. But if you are selling a product, and you only have 3 per cent or 4 per cent of the market and someone else had the balance, you'd think that you could probably take 1 or 2 per cent off that other person. You wouldn't think that that was a mad ambition to have.

So, in my head, what I'm saying to everyone, all the community groups we're working with, is 'Let's not just think how we can get the revenue back that we were planning to get before; let's think how we can go beyond that'. And, of course, to the extent that Transport for Wales is able to get a slightly wider remit, and to the extent that we're able to be effective so that we can control the whole of the transport network, we will be able, much more, in the future, to encourage modal shift from the car to train. So, I think we've got a very difficult period followed by, potentially, a significant opportunity, once it's safe to do so from a COVID perspective.  

10:20

You'd think I'd have learnt to unmute by now, wouldn't you, after all these months? My apologies.

I want to talk a little bit more about the future relationship with Keolis and Amey. Can you tell us a bit more about the form and the purpose of the new partnership between Transport for Wales, Keolis and Amey? For example, what role will each of Keolis and Amey play? And is it a single contract or two contracts? And how long will it last? 

Yes, absolutely. So, I'll use the same principles, as I said earlier, about numbers, but very happy to be completely free in terms of where we are in terms of negotiations and institutional set-ups.

It's different for Keolis and Amey. For Amey—. Well, it's not Amey, it's Amey Keolis. So, a company called AKIL—it's a poor acronym, but it stands for Amey Keolis Infrastructure Limited—currently provides managing agent services for the metro for us, and they maintain the core Valleys network for us. That was originally let as part of the franchise on a 15-year contract basis. However, that was let through something called the operator and development partner, which is, in essence, KeolisAmey. So, we've got one contract with KeolisAmey, which has got rail services running off it, which is the piece we're bringing in through OLR, and another piece, which is infrastructure management and metro transformation, which is currently let through the ODP but through AKIL. ODP will disappear in this new agreement, so we have to have a direct relationship—Transport for Wales has to have a direct relationship with AKIL. And, in essence, we're stepping into that existing contract with Amey, but we're reducing the time of it from 15 years to seven years.

So, nothing really changes in terms of metro, and infrastructure management with Amey Keolis Infrastructure Limited, which is 80 per cent Amey, except it's going from 15 to seven years. The terms are pretty much the same; the rate cards, which is how much you pay for different jobs, will remain the same. For Keolis, that, obviously, isn't the case. So, Keolis are a minor part player in AKIL, and they may or may not remain in that AKIL business in the future. That's a decision for them, not a decision for me.

What I have been keen to do—and I'd say I'm keen to do, but we can live without it—is to create a contract alongside that that allows us to have continued access to Keolis and Amey's consulting business. Now, I don't mean that because we want to fill the business up with consultants at all, but, for example, Keolis operate demand-responsive travel around the world. Keolis put in new integrated ticketing systems. They run light rail networks. And whilst the board and myself are confident that we've got the right team to bring the services in-house, I think it would be arrogant in the extreme to think that we can do that transition without some support from people who have done it before. So, the joint-venture piece, which we're working up with KeolisAmey, is an attempt—and they're keen on it—

10:25

I'm sure they are—it'll make them a lot of money. Obviously they would.

Just to be clear, the figures—I won't quote actual figures—

—will be probably 5 or 6 per cent of what they would have made on the existing contract. So, they will be making a whole lot less. And in addition to that, what we are trying to do—. We've got a settlement agreement with Keolis to have a managed transition from one system to another. That has got a cost to it. What I'm trying to do is get this joint venture out of that existing cost. So, we're not paying any extra for it. We've agreed to a settlement, and I'm saying, 'However, as part of that settlement, I also want access to intellectual property, access to systems, and access to people for a period of up to five years.'

Okay. Forgive me for interrupting you, but I just want to make sure that I've understood what you've said so far, because there's an awful lot of Keolises and Ameys and other bits. This worries me, because I like to be able to see lines really clearly, and I may be being a bit dense here. Something that you've said now is slightly different to what I'd understood when we were discussing this with the Minister, so I want to get this clear in my head. So, the existing contract with AKIL for delivering the metro more or less stays the same.

So, that's where it is. But this new relationship with Keolis and Amey is something that's still being negotiated, it isn't finalised. Is that right?

Correct. We've got a heads of terms agreement, but not beyond that yet.

Okay. So, what we can be sure of as a committee is that there will be an agreement of some sort, but you haven't, in fairness, had time to work out all the detail. Is that right?

So, either this will be an agreement simply to access systems and intellectual property, or it will be systems, intellectual property and people. If it's systems and intellectual property, it will just be an access agreement. If it includes people, it will probably be a joint venture.

Okay. We're very conscious, James, that, in the past, Transport for Wales has been criticised for using consultants too much. I'm not going to make a comment about whether I think that was fair or not. But that is quite an expensive process, and I suppose my concern would be, if you're using consultants, does that help you develop your in-house capacity, or does it get in the way? Because I am sceptical. Local authorities, for example, who use consultants, are also at the same time paying senior managers an awful lot of money, and my question has always been, 'Why do we need the consultants and the very expensive senior managers?' My perspective would be you either need one or the other. And I wouldn't want to see—and I say this as somebody who's very supportive of the new model; you will know that Plaid Cymru advocated for a model a bit like this when the contract was originally let, so this is not in any way to undermine what the plans are, going forward. But is there not a risk that if you use the private companies for consultancy—the stuff around intellectual property, that seems completely obvious to me you should do that—but, if you're bringing them in as consultants, does that help you develop your in-house capacity going forward, or does that give your senior managers a get-out-of-jail-free card, because they turn to the consultants when they've got difficult questions to answer?

10:30

I think that's such a fair question, and, personally, I'd veer towards the direction that your question is coming from. So, I worry that people use consultants as a comfort blanket. I worry that, quite often, they're not very good. I'm not talking about the people here—I'm talking about what you get as a consequence.

And people don't own what they've delivered, either. So, just in terms of more generally, we have put in place processes to try and remove consultants out of our business so we are not reliant on them, and we've reduced the numbers significantly. It's grown slightly through the mobilisation process for OLR, because there's a whole series—it depends what you mean by 'consultant', but there's a whole series of lawyers and accountants working with us to work that through; once we mobilise, they will disappear. The challenge we've got is that if you look inside Keolis and Amey—and I'm not making a value judgment on this—if you look in the transformation team, for example, all bar one of their team are consultants in that space—consultants to Keolis Amey. So, we need to go on a journey, I think. What I want to do is to make sure we can go on a journey and then turn the wick down pretty quickly, but not have a cut-off point where we go from having this whole team of people who are doing something that is quite technical, hasn't been done before in the UK, to a place where we lose all of those people overnight.

Okay. I think that makes sense. And just finally from me, Chair, if that's okay. So, this situation is in a bit of flux at the moment; there are still decisions to be made. When that's all settled down, will you be in a position to be completely transparent with this committee about what these ongoing relationships with these private sector companies are? Because I think it's really important for us to be able to see that, once it's sorted.

Absolutely, and our proposal is that the figures will all be visible as well, so we will be, I assume, up to—. There may be a requirement for it to be redacted for a short period of time; I don't know what the commercial requirements of the stock market, et cetera, are. But we—for state aid, for value for money, for Public Accounts Committee, for public scrutiny more generally—are writing all of this up into one document that will be available for groups, including yourselves, and then I could be scrutinised on the back of that.

James, can I just ask? The Government have said that there's going to be a saving, as they're not paying a private operator, but I just listened to your answers to Helen Mary—you've also said that the new consultancy type of contract will cost 5 per cent to 6 per cent of the total Keolis Amey would have been paid, so—

Sorry, 5 per cent to 6 per cent of the profit they would have made, not the total they would have been paid. Sorry.

Right. Okay. So, my ultimate question: is it a saving? You're not paying extra for the new contract, I suppose, is my question.

It is a saving. What we need to do is demonstrate that we will be an effective operator, because, if we can't be effective, any saving, obviously, potentially disappears. Depending on how successful you thought Keolis Amey were going to be in the future, those savings could be very real—over the lifetime of the contract, might amount to a couple of hundred million pounds. But I think it's way too early to be making predictions about that. What I can say is that we should have a more efficient structure, because we will be having a lot fewer contracts, therefore people will not be needing to spend time contract-managing each other from both sides; they can spend all of their time providing a good service to the customer.

I'm really conscious we are actually running out of time, so, as long as you're happy, James, we will run over a little bit on this section— 

Okay, that's fine.

—if that's okay with you, but just bearing in mind that Suzy and Joyce need to come in yet as well with questions, and I do want to go back to some other questions as well. Suzy Davies.

10:35

Thanks, Russell. James, I've got a couple of questions for you on what you were referring to as 'bonkers' earlier on, but I just want to ask you upfront: this issue of the remit letter and the gap between June and now, have you got an explanation for that? Because, if you're going to be asked to take on more responsibilities, I think we need a little bit of assurance on governance here and how you're able to operate without a remit letter for four months, five months.

So, this is something that our board, quite rightly, worries about, and, as a consequence of worrying about it, we've done things about it. So, we have in place a letter from the Welsh Government, which— [Inaudible.]—because we have entered into x, y and z contracts, in essence, in the name of Welsh Government, that we have got coverage to spend that money. So, from a financial coverage perspective, we've put a letter in place that does that.

In terms of broader governance, obviously, once we have that budget within TfW, all of our existing governance practices continue, regardless of remit letter position. So, we have a draft business plan that we're working towards. It's 'draft' simply because of the gap with the remit letter; it will be not draft once we have that. The board operates as normal, all the delegations operate as normal, et cetera, et cetera. So, within TfW, I don't think it's made any difference. Into the Welsh Government, from my perspective, we've done—and I think, at official level, they have done—everything that can be done to secure that position. So, there is a steering board that meets every month, and twice a year that includes the Minister and the Permanent Secretary, which holds us to account against our business plan or draft business plan. There's an operational board that goes to the next level, which meets every month. That's continued all the way through, monitoring our process, and we've been monitoring against the previous remit letter. So, in essence, the previous remit letter rolled forward. Is that desirable? No, I don't think.

Okay. So, when you put your letter in, saying, 'Actually, we're operating on a rolling-forward basis, did you get something back from Welsh Government that said, 'Yes, that's okay for now'?

So, that's broadly the letter I was talking about that says, 'Because you're operating on our behalf, because you've entered into these contracts on our behalf, we are giving you financial coverage for them'. Otherwise, they could bill—someone could bill James Price privately.

They wouldn't get very much. And the Welsh Government could say they're not going to pay us.

Okay, so long as you've got the reassurance back; it wasn't just a case of you requesting the cover. Okay, can we just move on? Obviously, we had the announcement of the national transport plan yesterday. You seem to be getting quite a lot of extra work to do on the back of that. Can you just tell us a little bit about how you plan to manage that and whether you're confident you've got the resources to manage it?

Okay. So, we've been working to get ready to take more activities for quite a long period of time. I think, initially, the board of Transport for Wales, which includes people with quite a lot of experience in the field—so, it includes people, as you will know, from Transport for London, who do this kind of thing—and people who are not wanting to take significant risks either. They want to do this properly. So, at the beginning of the process, when Welsh Government was saying they want Transport for Wales to—you may have presented it to be overambitious on everything; I think the board was very worried that we wouldn't be able to deliver against it. However, quite a lot of time has passed now. We've been able to develop the organisation and the speed at which stuff is transferring from Welsh Government to us has actually slowed down, it's not sped up. So, I think, on balance, the board would now be saying, 'We're ready. So long as it's done in a proper way, we're ready to take more activity. We believe that having more responsibility, certainly in bus, probably in certain aspects of highway, because bus et cetera runs on highway, is absolutely essential, and we believe we're ready to do it.'

So, I think we went from a position where the board would have been worried that we couldn't deliver at the pace at which some were suggesting we could. We're in a place where we now think we're absolutely ready, and, if anything, the board are probably chomping at the bit a little bit, wanting to get hold of some of this stuff, particularly coming out of COVID, because they think they could make a real difference with it.

10:40

Okay. I want to ask you if you've had to take on some new staff, or some new expertise to deal with this, but I also want to ask: is it sensible to be this excited about all these additional responsibilities when we heard earlier that the position pre COVID was resulting in KeolisAmey having to pay penalties for performance? There's quite a bridge of expectation to be covered here, isn't there?

Yes, I think that's a fair comment. I guess, if I was to try and answer both of those questions, I'd say we need to try and be excited and upbeat about the possibilities for public transport in the future, and I know this wasn't what you were saying at all, but not let COVID beat us into submission. Coming out of COVID, we will still have the same challenges that we had going into it, and I think it's my responsibility to give people confidence that we can still deliver, and maybe we can do more than we could do before if we have the ambition for it.

Have we got everything right? Is everything perfect? No. And some of the stuff around rail you've just talked about in the past, I guess, demonstrates that, but, equally, if you look at any project that is as ambitious as the one that we are on on rail, things have gone wrong. Now, I don't want to hold ourselves up at all in this space, because we haven't delivered enough to do that yet, but if you look at things like Crossrail, HS2, some of the other big London projects, they have all run into, actually, many, many much bigger problems than we are running into. So, does that make me feel good? No, not at all, but we are trying to learn lessons from all of that and apply them to what we're doing, and I think we're getting better.

In terms of have we needed to recruit additional people with different skills, the answer is 'yes', and we will continue to do that. Actually, that's one of the issues linked to the length of remit and consultancy. So, the longer the remit we have, the easier it is for us to recruit someone, rather than using a consultant. So, if we were only given a three-month period of work, you can't really recruit someone, because you don't know if you're funded at the end of it. But the area where we particularly need to be building some expertise at the minute is in the bus area.

That's a fair enough point. I suppose that leads me to my final question about what are you going to do if you don't get enough money to fulfil these ambitions.

So, I think that will be for a conversation probably with a future Government, in reality. Therefore, it's probably not really for me to comment on at the minute. We're working up a whole series of different scenarios, and it will, I think, depend upon what the Government of the day views as priorities, in essence, both at a macro level in terms of Government as a whole, but also in terms of what are the priorities in transport: are we going to focus more on work or social, are we going to focus on transport as a narrow tool, or are we going to focus on it as something that contributes to economic and societal change? I would favour the latter, and I think most Governments now—well, I think all Governments now would favour that, actually.

Good morning, James. We've talked about opportunities and challenges, and, of course, the Welsh Government has got a policy of embedding remote working or working from home. So, where do you see the challenges and the opportunities there for yourselves, both for rail and bus, and were you involved in any discussions before that policy was announced?

So, if I start with the end question to start with, Transport for Wales has been quite involved in providing data and analysis to inform the Wales transport strategy, and in fact some of the people who've written it have been embedded within Transport for Wales in terms of writing that document. In terms of me personally being involved in the discussions around that policy, no, not really. However, what I would say is that my starting position, and I think Transport for Wales's starting position, is not that public transport is a public good because it's public transport; public transport is a public good because it does something for people. If people can live in a different way that means they need less of it, or they need to consume it in a different way, that's not a problem to me. I think we need to be providing a public service that is capable of flexing to that need.

So, if I think back to the previous Wales transport strategy, which I had the dubious pleasure of being involved in writing back in 2008, I think, if I remember correctly, its first priority was to reduce the need for travelling. I remember people laughing quite a lot at the time, saying, 'Well, fancy having a transport strategy where the first objective is you reduce the need to travel', but actually, travelling in and of itself, I think most people, if you could avoid it, wouldn't want to do it, unless you want to go somewhere or have to go somewhere. So, the first point I guess I'd say is that public transport isn't a good for its own sake; it's a good because it allows you to do other things.

We think that people will want to operate differently after COVID, but it's really unclear exactly how that will pan out. I think it's way too early to say that. There are lots of reports saying that people will want to continue to work from home, and there's a lot of anecdotal evidence of that, but there are, equally, reports coming out talking about the damage to people's mental health, et cetera, et cetera. So, my best guess is, and it is only a guess, listening to various different data sources, that we'll end up in a mixed economy with people both working from home far more than they ever did before, or working more closely to home, but also wanting to travel more for leisure and travel more for the office. Actually, when we've done our own work looking at how people want to work in the office in the future, most of why people want to be in there is to be surrounded by other people, because they both feel that's good for their mental well-being and also it's good for some aspects of work.

So, I kind of think that is in support of the Welsh Government policy, which is broadly saying people should be able to work more from home than they can today, and there's a broad target around that, and/or closer to home. I think what we need to do is to create a transport system that is capable of bending to that different public demand in the future. How good would it be if the use of public transport across the day was far more balanced than it has been in the past, so—

10:45

Because we're running out of time—[Inaudible.]—to understand some things, and one of the main things is when we talk about the metro system that's currently being developed, how do you see this policy and that project working together? Do you see it as an opportunity?

I think it's an opportunity, yes. If we can do it, it's an opportunity. So, if you were to have Mark Barry here, who obviously wrote quite a lot of the papers on metro in the first place, Mark Barry's whole proposition was that people should be moving all around the region at all different points in the day in all different directions. The proposition was not that everyone marched out of their house at 7 o'clock in the morning, got on a train and headed into Cardiff, and then came back out again at 5 o'clock at night. That wasn't the proposition. The proposition was that south-east Wales should have a system that allowed it to operate more like south-east England and the area around London, where different parts have different functions, and maybe people from Cardiff go out for a meal in the evening in Pontypridd, for example. So, I think it actually allows us to focus more on what the original intention was: different settlements having different purposes, rather than necessarily this mass transportation in and out of one city all the time. Of course, it's still capable of doing that, but I think, as I said earlier, we just need to flex in terms of where the economy goes and where public demand goes.

10:50

And talking about demand, in some areas there is no rail. I live in one such area. We haven’t talked much about bus and the effect on bus transport in this new, emerging economy, potentially. So how do you see that fitting in as well? And of course, the bus has to equally serve rail, and vice versa.

Absolutely. So, as you will know, bus carries far more people than rail, and we don’t talk about it very much, actually, which is not very good. In TfW we do, but I think in society we don’t. There are some opportunities to try to be much more strategic than we’ve been in the past with bus, and I think the Welsh Government are trying to do that through their bus emergency funding measures, which have been linked to COVID, whereby they can control more of the networks that are run. As you will know, the fundamental problem with bus at the minute, in terms of bringing it into an integrated transport system, is that it is completely deregulated, and the operators therefore can run whatever services they want to. And in some instances, it’s not in their commercial interests to join up with the train, because they want to compete with the train, for example.

Obviously, there are bigger plans afoot in that space in terms of legislation in the future, but we know that, as a result of COVID, some of that has had to go a bit slower. But the good news is that the BES—it’s called 'BES', the bus emergency scheme—that Welsh Government is working on should allow some real changes to be made in that space, and that is one of the things that I believe we will be asked to take on in the near future.

Yes, absolutely. I think there’s some work to be done to understand in more detail what our role is vis-à-vis the role of local authorities and the role of corporate joint committees, but that is being worked through and, clearly, they all have an important role to play.

Thank you, James. I appreciate you just staying over a little bit extra as we’ve run over a little bit on this session. James, I know that there are a couple of areas that we haven’t had time to address, especially some issues around the core Valleys lines transfer as well, so if it’s okay with you—I know it will be, because you’re always very open to us corresponding with you—we’ll write to you on any points that we’ve not been able to cover.

That’s fine, yes.

I’m grateful for that. And we’ll also send you, of course, the transcript of this morning, so if there's anything else that you feel you want to add as well, then there's an opportunity to do that. So thank you, James, for being with us this morning.

Thank you for your time. Thanks. 

Okay, with that, we'll take a slightly shorter break than normal, because we're just a little bit behind time. So if you can just make sure you're back at just after 11 o'clock, please. 

11:05

Gohiriwyd y cyfarfod rhwng 10:53 ac 11:07.

The meeting adjourned between 10:53 and 11:07.

4. Rôl y partneriaethau sgiliau rhanbarthol yn yr adferiad yn dilyn y pandemig
4. The Role of the Regional Skills Partnerships in Pandemic Recovery

Croeso, bawb. I'd like to welcome Members back and move to item 4, which is the role of regional skills partnerships in the pandemic recovery, and we've got an opportunity this morning to hear from regional skills partnerships and their response to the recovery in terms of the pandemic. So, first of all, if I can ask the witnesses to introduce themselves—I think we agreed a running order previously. Would you like to introduce yourselves, just for the public record?

Good morning—bore da. Sian Lloyd Roberts, and I'm the north Wales regional skills partnership manager.

Good morning. My name's David Roberts, and I'm the chair of the north Wales skills partnership.

Good morning, all. My name's Huw Wilkinson, and I'm the Cardiff capital region skills partnership manager.

Good morning, all. I'm Rachel Clegg, I'm the development co-ordinator for the regional learning and skills partnership, south-west and mid Wales.

Lovely. Diolch yn fawr. Thank you ever so much for being with us this morning. If I can ask the first question, a very general opening question, really: what do you believe is your role in the economic recovery, from your perspective?

So, I’ll take that one first, Chair, before I pass on to Sian to provide some more detail. For me, as chair of the north Wales regional skills partnership, a good place to start is: what do we see, philosophically, as the role of the RSP? For me, the role is about being an orchestra leader, if you like. We're certainly not here to duplicate or complicate; rather, we're here to help focus the energies of our very capable regional partners to best effect, not least of which in challenging times such as those that we're currently in.

So, for me, it's as much about decluttering as well as filling gaps, if they exist, and I think, importantly, to act as a trusted conduit and effective communicator, if you like, between Governments, key regional partners, such as the North Wales Economic Ambition board for us, key public sector organisations, other providers and our customers. And I think we need to be really clear who we see our customers are. And I think, on the one hand, they're individuals in society, keen to attain gainful employment, and, in moments like this, perhaps find new employment to further themselves, as well as employers, on the other hand, who we would hope would be able to generate such employment opportunities for people.

Clearly, we're in a much more reactive state right now—ordinarily, we'd be focused on priorities maybe two or three years out. So, I see a really key priority for all the RSPs is to very much support the activities of our key partners, be they the likes of Careers Wales, the Department for Work and Pensions—where possible, bring to bear private sector help and resources too. And that's about supporting displaced employees across our region, helping signpost opportunities that do currently exist, as well as learning and development programmes that will help people to reskill and ultimately transition to other roles in the future.

I'll hand on to Sian now in a second, but key over the last six months or so has been the request from Government for the three RSPs to provide labour market insight and intelligence, and I know the three teams have been busying themselves producing bi-monthly reports. Sian, do you want to pick up and provide some more detail?

11:10

Yes, thank you, David. In terms of the labour market information report, as David noted, that's one of the key roles that we've been given by Welsh Government over the last few months. That forms part of our contract with Welsh Government. So, in essence, what that is is that LMI—that labour market information—that we're getting from employers in particular, but also from other partners as well, such as our further education and higher education and work-based learning providers, et cetera. So, what we're hoping, with that LMI report, is that it gives a current picture of what employers are saying their needs are at the moment. So, it's very much based on that soft intelligence of what employers are saying are their current and future skills and employment needs.

But we're also taking into consideration some other information in there: we look at job postings and vacancies in the region, how that indicates what the labour market is like. We also take into account the furloughed numbers for north Wales in particular. So, that, in particular, has been one of our main roles. And from conversations with colleagues in Welsh Government, that's shared within Welsh Government across policy leads, but also we share it with our partners across north Wales as well. So, we very much share it with the North Wales Economic Ambition Board, but also with the chief regional officer for north Wales, who also finds that intelligence quite useful for their planning on the economic side as well.

As part of that as well, I just wanted to mention quickly some of the things we've been doing in north Wales, in particular over the last few months, which we're hoping adds value to what's going on in the region and is helping some of our partners as well. So, one of the key things we've been doing is working—. Right at the beginning of lockdown, as it happens, we started to work with DWP and Working Wales, because we were very much aware that people were losing their jobs and we wanted to ensure that those people who were losing their jobs knew where to go—knew that there was support out there for them—and we knew that Working Wales was already there. We also knew that the job centres, through DWP, provide support.

In the same way, businesses needed to know where to go as well. So, what we did was form a partnership with them around what we're calling Opportunity North Wales, which is helping behind the scenes, really—that triage system, if you like, that enables people to know where they need to go, who they need to contact in the region. So, as part of that Opportunity North Wales, we've undertaken quite a few activities. One of them, mainly, is that we've been working in partnership to deliver virtual jobs fairs in the region. We undertook one over the summer, which was obviously targeting those people who've been made redundant. We've also got another one coming up in January, hopefully, helping, again, those people we know are going to be made redundant. So, we're working in partnership behind the scenes, really, on that.

Also, we've undertaken quite a few activities helping those front-line staff who deal with people who are being made redundant and people who want to get into a job. So, what we did in October is—

Sian, finish please, but I'm just conscious we've got a lot of questions to get through—

Yes—no problem. So, we just held an employability conference for front-line staff to enable those front-line staff to know what programmes are currently out there in north Wales to help them direct those people who are losing their jobs. So, yes. So, we did that as well.

11:15

Sorry, Sian, for interrupting. We want detailed answers; at the same time, we've got more questions, though, to get through than we've got time, unfortunately. Can I welcome Richard Tobutt to the meeting? Richard was with us earlier, but he just dropped out at the beginning of the meeting. So, Richard, do you want to just introduce yourself as well—introduce yourself for the public record?

Certainly, and apologies for the connection problems earlier on. Bore da, bawb. I'm Richard Tobutt. I'm one of two managers operating out of the south-east Wales regional skills partnership.

Thank you, Richard. No apologies needed; this is the world we live in, unfortunately, so thank you for joining us as well. Perhaps if I could ask the next question to some of the other witnesses that have not spoken to date. The pandemic is obviously shaping skills demand and I'm wondering about your thoughts on that, in regards to what skills you think are needed in terms of supporting the recovery. Either perhaps Rachel, or Huw or Richard. Richard's indicated. Richard.

I'm more than happy just to start the discussion on this question, if that's okay. And just to reiterate what Sian was talking about earlier in terms of the importance of our bi-monthly COVID-19 reports, it's the intelligence that we're generating through that exercise that's actually shaping Welsh Government's pathway to recovery. And some of the interventions that Welsh Government are introducing—for example, the personal learning account programme, the economic resilience fund and the new apprenticeship incentive programme—those initiatives have very much been informed by the labour market intelligence that we're developing.

I think it would be fair to say, as you alluded to, that the pandemic has naturally created a significant impact on our region here in south Wales—south-east Wales, sorry. And it would be fair to say that certain sectors have been impacted more than others. In terms of the aerospace and engineering, automotive sectors, there are significant challenges there. But also there's a couple of anomalies as well in the mix, so, for example, in terms of the semiconductor sector, which is important to the south-east Wales economy, generally, employers are pretty optimistic there.

I think, from our findings, we hold the view that the virus has probably not created any major new upskilling requirements. Naturally, we've seen a notable increase in home working and that's brought some small-scale challenges when using virtual technology such as Teams, Skype, Zoom, and I'm a perfect example of that this morning, as we've all seen.

But just to draw reference to an issue that we've heard from particularly within engineering, the recruitment of skilled technical engineers has become even more apparent. We've heard from our stakeholders, as part of the exercise, that Wales as a nation needs to get better at 'making things that make things', to use the quote that's been reported to me on a couple of occasions. So, just to elaborate on that, equipment and machinery is often provided by overseas companies, particularly within Germany and the far east, and, naturally, that's where the service and repair skills reside. So, the pandemic has created some challenges in this regard, particularly around travel restrictions and quarantine restrictions, and when machinery goes wrong the local skills aren't there, basically, so the pandemic has created a challenge there. I can elaborate on others if needs be, but I'll probably be quiet for a bit.

Thank you, Richard, we appreciate that. Rachel, you wanted to come in, and perhaps—I know you want to come in, Rachel, but if you can also perhaps address what recommendations you think that we need to make to Government in regards to the discussion so far. Rachel.

Thank you, Chair. Just really to reiterate what Richard just said, in terms of we feel, from our partnership's perspective, that the pandemic has only accelerated, really, and deepened pre-existing trends in terms of skills needs that maybe we were already aware of. We've consistently highlighted the need for the development of digital skills and, of course, the pandemic has really brought that to the fore in terms of the prevalence of digital communication methods and a reliance on remote working.

As Richard alluded to, a need for technical skills really across a number of sectors, primarily engineering and construction—that remains a concern for many businesses. And, of course, that's been made worse by the threat of losing skilled staff and then a perceived lack of available people with the right skills to take their place, really. Soft skills and multi-skilled individuals are very much still a requirement. We know that many businesses have had to diversify their activity to counteract the effects of the pandemic, and that's resulted, really, in employees having to do jobs that they weren't originally employed to do. The health and social care sector, obviously, it's been well documented in the press, I think, that there's been an exponential increase in demand for health and social care services, and that's only substantiated skills needs, and a general need, really, to recruit into the sector. We have evidence at the moment indicating that nurses and care workers are most in demand at the moment. 

In our region, we've seen a really increased demand for heavy goods vehicle and large goods vehicle drivers, and I'm sure that that's not a surprise that there's been a real shift in terms of consumer spending habits, with a movement to more online purchasing. And that's really been a challenge for our region for a number of years, but I think the pandemic has further corroborated the need for adequate support for individuals wanting to gain the required skills and accreditations that they need.

In terms of specific recommendations moving forward, I can't be too specific because we're currently in the process of analysing data for the next submission to Welsh Government. However, I think the pandemic—

11:20

The next submission of the bi-monthly report is due to go in at the end of the month.

And what about the previous reports—when were they submitted?

So, really, in the previous report, we highlighted the need for, I think, flexible skills provision, which is employer-led, which shouldn't come as a surprise. And in some instances—

When was that reported to Government, just for a timeline?

It was two months ago.

Two months ago. Okay. I'm interested actually, what did you report in that piece?

The need for flexible skills provision, and in some instances, provision that isn't accredited. A lot of the evidence that we were gaining from employers was around the need for support with issues such as HR, marketing, moving themselves to an online business, rather than a shop-facing business, then. We made a lot of reference to delivery methods of training provision. I think a lot more focus on maybe online courses, blended learning approaches and short and sharp courses really.

We also made specific reference to continued adequate investment in apprenticeship provision across the region—they're very much still favoured by many employers as a training mechanism.

And I don't know if—. You've all come in today, so I'll just come to Huw, if you've got anything to add. And really, Huw, I suppose, in terms of your reporting round to Government, what are you reporting to Government in terms of what your recommendations are? 

Very similar to what Rachel's already covered. The system still needs to be demand-led and shaped by the employers, really. I think it's probably fair to say that employment skills and plans still have currency, and we're working to progress those. Flexibility—definitely within the system, and we've seen, obviously, that move to more digital e-learning, and there's that increased awareness, I think, by employers, that those kind of training resources need to be developed digitally in the future. And I think that's a skill and a role that's seen as in demand at the moment also.

Thank you, Chair. Welcome, everyone. Before I move on to my questions, can I just make a point? I realise that there are very few options available in terms of training at the moment, but blended learning, certainly in the compulsory education sector, the jury is very much out on that, so I'm hoping that you'll be doing some monitoring work on the effectiveness of this with the people you're involved with. But what I'm picking up from your answers so far is that it's less a question of new skills needed but the pace at which they're needed. Is that why you haven't changed your ESPs yet?

11:25

Who would like to address that question? Huw, and then I'll come to Richard.

Yes, essentially that. We've reviewed our employment and skills plans over the pandemic period, and as I suggested just before, we still believe that they have currency and have been working really, really closely with all of our stakeholders, employers and training providers to make sure that we progress towards those actions. For example, within our plan, there are the six themes that we've mentioned, and we've set out a three-year action plan on how we achieve against those themes and it's regularly monitored for progress and reported back to the likes of our employment and skills board.

So, at the moment, exactly that. We don't feel that there are any major changes required, and we are working very closely, as has been suggested through the COVID-19 reporting, with employers to gather as much intelligence as possible, so then we can help inform Welsh Government's decisions and recovery.

Yes. If I could just quickly come in. Yes, we, as the Cardiff capital region skills partnership, feel very much that our employment and skills plans still have currency. This is something that we've been asking our employers on each of our cluster groups, and there is a strong view around the table that the actions and recommendations that we propose, and proposed last year, still have weight. So, we are still working on the basis that it's those actions and recommendations that will be continuing to deliver into the future.

But I want to make the point as well in terms of the training provision and the world of FE work-based learning and higher education. The initial feedback that we're getting from our employers is that the providers, whether that be schools, colleges or universities, have been doing a sterling effort, I think, in the short term, to implement social distancing measures to ensure that learning can continue and to introduce virtual blended learning opportunities for learners.

So, yes, naturally, there were early challenges that we're all fully aware of, but I think that the provider network has really stepped up to address some of those issues. But as we're all aware, this is a constantly evolving picture, and no doubt, over time, we will see the true impact of some of those interventions among the employers that we represent, and we'll be keen to capture some of that.

Well, you're right, it is a constantly changing picture, so, I’d like to hear a little bit from you about how you think the skills system itself should change. What changes do you expect to see in delivery that are not just about moving things online? And whether you, as organisations, need to be doing things a little bit differently to respond to this as well, because what we emerge with is going to be quite different to what we went in with.

Yes. If I could start off and then perhaps hand over to a colleague of mine. I think the role of schools is really important, and more needs to be done to bring schools and employers closer together. On a personal level, within our regional skills partnership area, I've been working strategically with Welsh Government around the development of careers and work-related experience. As part of the new curriculum in 2022, Welsh Government are developing statutory guidance around CWRE. For me, that's a step in the right direction, and I feel strongly that learners should better experience the world of work.

I still think that we also have challenges around—and I know we’ve been talking about this for quite some time—certainly, parity of esteem between vocational and academic provision. I think there are still challenges there that need to be addressed, particularly apprenticeships are vital in this regard and offer great opportunities for learners who may progress better in a working environment. And I think that we've got more to do to influence influencers, so, particularly parents and teachers, to change mindsets and negative perceptions. I think there are some real opportunities there for us to progress.

11:30

If I can just finish on this question, Chair, if you're all right with that. I mean, obviously, the Minister has relatively recently announced a £40 million package in order to address some of the challenges of retraining and new sorts of employment, but none of that's aimed at schools. What influence do you have on the Minister in maybe asking him to consider a package for this? Or do you think it's a matter for the education Minister? And that'll be my last question.

If I could quickly come back, I think there are some really good examples where the regional skills partnerships are actually influencing provision, again focusing on post 16. The personal learning account programme is roughly a £15 million pot of money that's been introduced on the back of the pandemic for the FE sector, but there are opportunities for the FE sector to collaborate with work-based learning providers in this regard. And that has been used as an opportunity to make positive inroads with those who've been negatively influenced by the pandemic, and I know that we as an RSP, and other RSPs have been working quite hard with our FE colleges to ensure that provision is very much aligned with the needs of the regional economy.

And I also want to single out apprenticeships as well. I think the pandemic has brought significant challenges for the delivery of apprenticeship programmes, and particularly the delivery of competency-based components—you know, the NVQ element—and we may need some flexibility and agility around that. Because generally, apprenticeship programmes are taking longer to deliver because the work-based learning assessment element is proving to be particularly challenging. But I think we've got through a lot of that now, and the apprenticeship incentive programme that will be available to employers should make some real positive inroads in terms of future apprenticeship delivery.

Well, thank you for that. Obviously, apprenticeships will only work if we have places for them to do their learning in. Am I allowed to sneak another one in, Russ? Would you mind?

I'm not quite sure how much time I've got on this. What's your view on the work-based learning element of apprenticeships being delivered across more than one employer, bearing in mind the difficulty we have now in asking employers to take somebody on for a whole year, regardless of incentives?

I'll come to Richard, and then I'll come to David, who was indicating that he wanted to come in on your last question as well, so—[Inaudible.]

Thank you, Chair, I appreciate that. It was just to make one point, and I'm sorry, I don't necessarily have the answer to this, but picking up on a really key point that Richard made about how successfully we can reach back into the school system. I think my view is that, in any economy over time, whether it's as a result of shocks like that that we're currently going through, there will be sectors that ebb and flow in terms of their requirement for employees and skills, and I just don't believe at the moment that the skill system or the system at large has a good enough way of exciting the next generation of youngsters coming through school to see what may be five, 10 years down the line.

And as an example, in the north Wales context, we have a massive opportunity here in north Wales on the energy side, and renewable energy in particular, and the plethora of schemes going on at the minute. And I'm not sure that your typical 14, 15 and 16-year-old has the first clue as to what may be coming down the pipe in terms of high-value, really great careers. Now, I don't know the answer to this, and I'll be challenging my RSP to think about how we help influence this and shape the next—because you want demand-led, don't you? You want the youngsters to be saying, crying out, going, 'I want a role that looks like this in that sector. Where's the education provision to help me get there?' as opposed to being pushed aside all the time. So, I just wanted to pick up on the point Richard made. I don't know what remit we have for reaching to schools. Sian may be able to tell me after this, but I think there's a key linkage there that's weak at the moment.

I'm just conscious of time. Rachel, you wanted to come in as well.

I'll be really quick, I promise. Just to reiterate, really, points that have been made around the importance of engaging with schools. We are really, really aware of the importance of meeting that balance between learner demand, employer demand and provider demand, and I think that's a really, really tough balance to get. But I think if we reach the younger generation quicker and better, we can create that pipeline of talent, and maybe open their eyes to different opportunities that they weren't even aware existed in the first place. I think we're doing a lot of good work in south-west and mid in terms of getting into schools, especially under the guise of the Swansea bay city deal. We're aware that there will be a lot of high-value, really, really exciting opportunities coming out of that, and so we need to get in nice and early so that these 13, 14, 15, 16-year-olds can make the right options and make the right choices so that they can reach their potential and get the careers that are out there, rather than having to maybe leave the area, as we have seen in the past. That's it.

11:35

Thank you, Rachel, we appreciate that. Can I just ask, and I only need a 'yes' or 'no' on this, really, but going back to my earlier points, Rachel mentioned reporting to Welsh Government on a bimonthly basis, do all partnerships report on a bimonthly basis? You're all nodding, so I'm taking that's a 'yes' from everyone. And also, do you publish that report? Is that publicly available? Sian's nodding. Is that the case with all partnerships? Do all partnerships make that report publicly available as well?

Just to come in, sorry, they're not available, per se, on our websites as our regional employment and skills plans have been in the past and are at the moment, but there is scope for that to happen, I think. But they are shared amongst a range of partners and representatives, really. We share it ourselves with all of our partners, and I'm sure the other partnerships do as well.

Okay, that's interesting. Huw, you wanted to come in as well, then, and Richard. Huw.

Yes, just to say that ours is currently—the last version of the report that we submitted is currently being translated, ready to be put on our website and made public.

The same point. There's work in progress there.

Can I ask you all, would you mind sending to our committee your last report, and if it's just about to come online, can you send us that report as well? Thank you, you're all in agreement, so thank you very much for that. Vikki Howells.

Thank you, Chair. We took some evidence a few weeks ago from Professor Ewart Keep, and he shared with us his concern about the quality of jobs being created post pandemic, that the quality would actually decrease. I'm just wondering what your views are on that and will that mean that industries' demands are going to shift even more towards lower skill levels, and what role the partnerships will play in ensuring that low-skill traps don't proliferate during the recovery and what sort of recommendations you would be making along those lines. 

Thank you, Chair. I think it's very possible that the quality of jobs being created post pandemic will reduce. Our evidence, unfortunately, has indicated that those most likely to be adversely affected will be those in unstable, part-time employment, which tends to be low paid. I would say that if the demand for lower level skills increases, then, yes, the partnership will make recommendations to that effect, because that's in keeping with our role, really, within our respective regions.

In a lot of ways, the issue of low-skills traps is bigger than the RSPs. It's almost a wider economic development issue that would require, I think, targeted interventions across a range of different areas, for example, housing, connectivity, rurality. Really, as I see it, the role of the partnerships is to support employers and businesses in any way that we can, and ensuring that the right people with the right skills are in the right place at the right time. Easier said than done, but, in turn, that would foster, I think, growth for businesses, and we can signpost to relevant support mechanisms, as we do, to ensure, as well, that provision exists to support them, I think, to create those high-value and skilled jobs and to develop their workforces more generally.

We would, of course, continue to ensure that there's adequate provision out there to support individuals to get out of those low-skills traps if they find themselves in them, through upskilling and reskilling, and I think then you'd see that natural churn of workers that would hopefully result in job creation. Obviously then we'd continue our efforts in ensuring that provision exists to support the creation of high-skilled jobs around the Swansea bay city deal and other large-scale projects.

11:40

Vikki, if you don't mind, can I just bring Helen Mary in? Helen Mary Jones, did you want to direct your question to Sian, because she wanted to come in as well?

Well, I don't mind if Sian answers, but it's in response to something that Rachel said about supporting businesses. In a sense, Rachel, you dealt with this as your answer progressed, but presumably that doesn't mean supporting businesses who are not providing good-quality opportunities for people, and who are moving from a more stable workforce to a less stable workforce. This isn't about supporting businesses whatever they're doing, is it? It's about ensuring that they do have access to a workforce that's got the skills they need, but I'm sure that none of us on this committee would want public money to be being used post pandemic in a way that was actually making it easier for businesses to misbehave, for want of a better word. I don't think—when you said 'more', Rachel, I don't think that was what you meant.

And I think we need to put that on the record. This isn't about supporting business, right or wrong; this is about creating opportunities, upskilling our economy and making sure that businesses have got access to skills, but also that people have got access to jobs that pay them enough money to live on.

Yes, absolutely.

Okay, and Sian, you wanted to come in, and then I'll bring David in. Sian.

I just wanted to mention really quickly, just to reiterate, really, what Rachel was noting there, that in terms of a north Wales growth deal, there are huge opportunities there for those high-value jobs, and we're working really closely with the economic ambition board and with the chief regional officer on a north Wales economic recovery plan. So it's just going back to something that Rachel said, that skills are part of the jigsaw. Skills can't work in a silo by themselves; it has to be cross-sectoral, so working across that economic development piece. So, we're very much working with the chief regional officer and also with the economic ambition board on that skills economic recovery plan, which will hopefully direct us towards those high-value jobs as well.

I was just going to make a point, if I may. I apologise, I'm not aware of Professor Keep's research, but I don't share such a pessimistic view, I have to say. I think most employers, if they've got any sense, will reflect as we emerge from this pandemic, and indeed are reflecting as we go along, as to what is the difference from a survival point of view and a thrive point of view, and I think that sensible employers will conclude that one of the differences will be how highly skilled their staff are, how adaptable they are, how capable they are at innovating, problem solving, adapting and so forth. I have a 20-year background as an HR director, so I care about this subject. I think you would conclude that, if you don't already, you should be investing more in the skill sets of your staff. Now, you might have a smaller workforce, maybe, but I think you'll see good employers investing more and saying, 'You know what? We missed a trick. We came into the last challenge unprepared. Let's make sure that our staff are as versatile and as skilled as possible going forward.' So, I would conclude that the quality of many roles will only go up.

Yes, just really to back up what David has said there, from some of the intelligence we're gathering for our COVID-19 report, employers are almost suggesting that the workforce, with the creation of new jobs, needs to be multiskilled, that the employees need to be able to work across more roles within their organisation, so that increased skill level is becoming more important. And—sorry, I lost my train of thought there. Sorry, I'll come back.

Good morning, all. Just following on from that, it is always the case that people have needed to be multiskilled, and of course the Welsh Government has invested in continuous learning as a consequence of that, moving with the times, so to speak. But time doesn't stay still, so that leads me nicely to my next point and the question I'm going to ask you. I'd like to know what progress has been made by your relevant partnerships in implementing the recommendations in the Graystone and SQW reviews, and particularly the progress that's been made from the recommendations of a previous report by this committee, which asked for a timetable to implement some of those changes, particularly focusing on the work with the relevant growth or city deals that you're involved with.

11:45

Thanks very much. I think the first important point to stress is that I'm fully aware of the independent review that was conducted by Professor John Graystone back in, I think it was, March 2018. In terms of the Cardiff capital region skills partnership, both myself and Huw have been in post from January this year, and we've just recently brought another member of staff into the team. I'm aware of the 19 recommendations, but historically haven't been actively involved in delivering against those. But quite recently, I think it's important to stress, we've made some real positive inroads, I think, against the recommendations that have emerged, particularly from the Graystone review. And speaking as the south-east RSP, we've experienced quite significant changes, I think, over the last 12 to 18 months. For example, LSkIP, which is the learning, skills and innovation partnership, is no more, and now the work of the RSP is very much embedded in Newport City Council and is very much more closely aligned to the Cardiff capital region city deal. 

But just to pick out some of the recommendations that came out from the Graystone review and just to talk about some of the progress that has been made. In terms of resources—I think resources were a specific theme—our RSP has now got three permanent job roles driving forward the work within our RSP, which is progression. In terms of governance, I think it would be fair to say that we have stronger employer leadership through our employment and skills board. That includes the key regional stakeholders, and we meet on a bimonthly basis, and those meetings are scheduled a calendar 12 months in advance. There is now clearer information articulated through our website, and it's very much work in progress in relation to that. We have refreshed terms of reference for our board and the underpinning cluster groups as well, and Welsh Government attend those meetings on a regular basis as an observer and provide regular updates on policy and strategy within Welsh Government.

In terms of openness and transparency, we talk a lot about our employment and skills plan. I think when Graystone conducted his review, I think, at that stage, regional skills partnerships were very much progressing annual plans, and now there has been a pretty important shift, I think, to a three-year planning process, which seems to be particularly welcomed by the employers and stakeholders who we represent. We launched our employment and skills plan in the autumn of last year. That event attracted a wide-ranging audience. We make papers from our meetings available through our website. I'm conscious that I'm giving quite a few examples of where we have made some really positive inroads, I think, on the back of the Graystone review. 

Okay. I can see others agreeing with your comments, so I'll take it that you're all in agreement. And then Sian wanted to come in—Sian Roberts. 

I just wanted to come in, really, to reiterate what Richard said, but in particular for us in north Wales, we were really keen to ensure that we had that employer voice, an even stronger employer voice, in the partnership, and we've worked really hard over the last few months, or last year, since David came in as the new chair, to ensure that we've got that employer voice, which is quite strong now. We've got representatives across all our key and growth sectors, and they're invaluable. All the help they give us and all the information they share with us is really invaluable. So I just wanted to mention that in particular for north Wales. 

Can I ask Rachel particularly? Because I cover mid and west Wales, so I'm very keen on what's happening in mid and west Wales, but I'm very keen also on the innovation that’s happening in that area, where people have moved, shifted their focus really quickly because need has developed innovation—it’s been that way around, quite frankly. So, in terms of trying to support, and perhaps grow, that new innovation in mid and west Wales, how are you engaging with that? And I know there are huge challenges—of course there are, and I accept that—but I'd just be very interested to know, because this is the opportunity; it's here, it's now, and I share David's optimism about it. So, what sort of role, what sort of space, do you occupy in that?

11:50

Really quite an important one, I think. We continue to support the region, both growth deals—the growing mid Wales partnership growth deal, and the Swansea bay city deal. In terms of our space in that area, we continue to provide LMI support where necessary, to underpin, I think, the development of that innovative sort of space, and I think that that's really important, moving forward. As Sian alluded to earlier, I think the key for us as partnerships—especially, I think, our employer engagement has really, really improved, and especially improved in mid Wales. We know that mid Wales has specific challenges, especially around FE provision, with learners having to move across the border to maybe really study the courses that they want to study. In terms of our role in that, it’s about ensuring, really, that our finger is on the pulse, for want of a better phrase, in being on the ground, understanding what's happening, and being able to ensure, once again, that the learners are there, the young people are there, to be able to develop those spaces, and develop innovation as it happens.

And just one final quick one. You mentioned construction—somebody did—and engineering as being a particular challenge, and yet there’s a lot of innovation at the same time, with the new announcement on the pilot scheme to build new houses off site. So, what sort of engagement are you having with providers—and there are providers currently, in Neath and Port Talbot College, for example, that serve mid and west Wales. What sort of conversations are you having in that field?

So, modular sort of building skills and those sorts of issues come to the fore quite frequently. We, similarly to the other partnerships, have cluster groups. So, we have a very, very well attended construction cluster group. And partners from both mid Wales and south-west Wales attend those. Those discussions have happened. What we've done, and this was actually a specific recommendation out of the SQW review, was to open, I think, our cluster groups up to providers and really improve the dialogue between providers and employers. And, I think, since we've done that, on the construction group, there has been some really, really good progress in terms of really identifying what the skills needs are, and then translating that into actual meaningful recommendations that we can move forward with. And I think we're really improving on that front.

It’s only a quick point, but, within our region, we are very, very keen to capitalise on any gains that we've made in relation to the low-carbon agenda on the back of the pandemic, and we're keen to maintain that momentum. Within our RSP, we've been working strategically within the auspices of construction, and we've been working with the Construction Wales Innovation Centre, who are looking to develop a retrofit academy. And we're also aware of plans to establish an energy academy out of Bridgend College. So, in a construction context, both retrofit qualifications, and the development of those qualifications, and off-site construction, are two really important elements of our skills and employment plan that we’re very much looking to progress through our construction cluster group.

Thank you, Joyce. The Minister has previously mentioned that he's working on a contract for, if I've got this right, a centralised data source for labour market intelligence. Anyone who can report on that at all in terms of how that has progressed, or has it progressed? Huw.

11:55

Yes, we've been working with Welsh Government on this data source. Currently, the three RSPs procure this data source and tool separately, but it has made sense to have that central provision, and we work closely with Welsh Government in terms of our requirements as the RSPs, and I believe there is a tender being produced ready for that to be contracted centrally. 

Okay. Any indication on time scales for when that contract is going to be completed and we'll have that central source in place?

We haven't had an update recently, but I know our current contracts are coming towards their end, so you were keen to progress that on.

Okay. That's interesting. Thank you, Huw. Helen Mary Jones.

Thank you, Chair. I want to ask some questions in a minute about moving forward, but I've got a specific question first about, as you're developing your plans as regional skills partnerships, do you address the issues of the way that our labour market is so segregated by sex, with men and boys tending to do one lot of jobs and women and girls tending to do others, and women and girls tending not to be paid as well? Is that something that you consider in your work and when you're looking at what investment ought to be made in skills? I can see Rachel wants to come in there—that's great.

Thank you. Yes, we do, in answer to your question, and that's a really important consideration for us. It goes back to the point that I made earlier, really, about how important schools engagement is. Those ideas, I think, of gender-specific 'job roles' are really embedded at quite a young age, and I think that's a massive issue that needs to be addressed. Because, obviously, we know that opening different sectors up, or achieving equality, then, I think, in employment in those gender-stereotyped sectors, would really, really improve our economy in terms of offering different levels of skillsets and bringing to the fore different specialities, really, and allowing a more level playing field, I think.

So, in answer to your question, yes, it is something that we've addressed for the last three years through our regional employment and skills plans. We look at specific data, looking at the gender breakdown of employees within certain sectors, and that is something that we're keen to move forward and progress.

I can see lots of agreement with that, and that's great. I'm very conscious of time, but I think, Chair—did Huw want to come in there?

Yes, just to back that up and say, quite recently, we've been doing some in-depth work with Careers Wales and our sector chairs around the perceptions of each of the sectors, and I think gender perceptions is one of those—it's come to the fore. And really the idea of that task and finish group is to set those sector needs up with Careers Wales to make sure that all of our careers advice, information and guidance is appropriate and is reflective of those sectors. So, I do think that gender imbalance and gender perception in the sectors will continue to be addressed with that.

That's really encouraging, and I want just to put to you, in that regard, that we do an awful lot, when we talk about that, about encouraging girls and women into roles that have been traditionally held by men and boys. But I also think it's worth considering the other way around. You know, we need more men and boys working in care, we need more of them in childcare—partly because there are some really good opportunities, but also because we know, historically, that when we have men and boys working in a sector, we tend to start paying them better. So, there's a good reason to do that.

But if I can just come on to my main set of questions, which is really—. You've talked about some of the improvements that you've been making in your own work over the last year or two; there were a number of you talking about improved employer engagement, for example. Can I ask what your priorities are now for improving how you operate? What areas do you need to address? And are there particular recommendations that we as a committee could make to Welsh Government to help you with those improvement plans at areas you need to—? You've talked, for example, about the ongoing challenge of engaging with schools. Is there something we could say to Welsh Government that might make it easier for you to do that? So, what are your future improvement plans, and what can we recommend that might help you with those?

12:00

Thank you, Chair. I think for us, really, moving forward, our priorities are to build on the already good partnerships that we've developed with a range of organisations, but with a particular focus on continuing to improve, and, I think, facilitate dialogue between providers and employers. Because I think what that does is it saves us time, really, in addressing the things that we can and should address. We want to continue to work to find the balance between, as I mentioned earlier, learner demand, and that comes back to perceptions and schools-level engagement, meeting that with employer demand and also provider demand, and then developing workable solutions, I think, which improve the lives, really, of people working, living and training in our region.

We'd like to improve data collection analysis on key policy areas, such as equality—like we've just discussed—diversity, the Welsh language, Brexit, of course, because that's another major economic disruptor to consider, and also green skills, because I see that there's a real opportunity there for our region to capitalise on that.

I think we want to strengthen our capability of being able to project and forecast, really, future skills needs. We've mentioned the three-year plans and we welcome those, as do our partners. But we want to be able to write them in a more strategic way, so that partners, organisations, can adequately plan, and, really, we want to continue to share good practice with our colleagues—my colleagues here from the other RSPs. I think we've made some really, really good headway in recent years with developing that cohesion, really, and building that national picture. I know that's something that we've been—that's been really brought up in the past as a negative thing, that we've not been too cohesive and there's not been enough consistency. So, I think, for us, it's about developing those relationships. Thank you.

If I could come in quickly, I think the important thing to say from our perspective within the region is that we are very, very grateful for the investment that we do get from Welsh Government to carry out our roles and responsibilities. I think, over the last 12 months, we've made some really positive inroads to some of the things that have come out through previous hearings and reviews, but I think it's important to say as well that the level of investment that we do get only allows us to go so far, really. Certainly, in terms of the resource we have for research and analysis, we'd be keen to strengthen our role there, and I would also agree with previous findings, in that our approach to employer engagement has certainly increased, and we've done some good work in that area, but I think we're keen to continue that and to build on that, and particularly our engagement with hard-to-reach groups like SMEs, for example, is particularly challenging. So, to allow us to do that, I think, if there was resource that could be provided to help us do that, that would be really very much welcomed.

Thank you. I'm just going back to your question, Helen, in regards to the schools and the input of schools and maybe our role with schools, and I think that's really key, because what's coming through quite clearly to us, when we speak to FE, HE, is our focus has been on post 16, and that's too late, to be honest, it's too late, and we should really be looking at the whole jigsaw and doing some more with schools—which we do do anyway, as part of our role, especially in north Wales; we've been working quite a lot with schools, targeting those career perceptions. But the important point here is—it goes back to something that's been said earlier on—if we're looking to let those young people out there know that there are these high-quality jobs coming through, through things like the north Wales growth deal et cetera, then they need to know that those jobs exist in the first place. I think we're missing a trick somewhere along the line where perhaps they're not aware of those opportunities. You're probably aware of the Seren project, targeting those highly able individuals; I went to their conference in north Wales last year to give some labour market information to them about roles in north Wales, and I was quite shocked to see that not many of them knew what opportunities were out there for them to stay in the area. I showed them pictures of M-Sparc, for example, in Gaerwen, and many other job opportunities and roles, and they just weren't aware of them. So, I think we need to do more there in terms of schools and career perceptions, so they can understand what's out there in terms of the economy and what they can do. 

12:05

Sian, are there things that you think this committee ought to recommend to Welsh Government that would help you to do that? Because that makes an awful lot of sense to me. Or is it just a question of having the resources and the time to do it?

In bullet point form if you can, Sian, as we're just out of time.

These are good questions, and I'm sorry for having to cut short. Sian.

I think it's a bit of both, if I'm completely honest. As I said, our focus has been post 16. So, we have been doing some work in the pre-16 arena, but I'd be really keen to do some more of that as well.

Okay. Well, Helen Mary's last question was an important one in terms of anything that—. I'm going to ask for final comments from you all. I'll come to Huw first, because I knew you wanted to come in, but please, in your very brief final comments, in Twitter length, perhaps, tell us what you think we should or could be recommending to the Government. Huw.

I think on that last point, it's important to say that there's some fantastic engagement by the employers within our priority sectors with schools. I think, though, to really support schools, there has to be that co-ordination of that engagement by those employers and businesses, and I think that would support that further information being provided to our young people at the right time. And there are some local-level strategies that are being welcomed by the schools, but I think there needs to be that enhanced almost regional or even national approach and co-ordinated approach, definitely. 

Thank you, Huw. Rachel, I think you wanted to come in.

Just really to say that I agree completely with points made by Richard, Sian and Huw. It is all about resource and having the time and the people to be able to do all of the things that we want to do. And they're not even things that we want to do—they are, but they're things that we need to do. I think that's the key to get across. So, yes, I'd say that's really what we'd like. Thank you.

Thank you. Does anybody else want to come in for a very quick, final comment? All has been said; that's good to hear. Thank you. I really appreciate your time this morning. We appreciate you are busy and we appreciate your willingness to come to committee. From our perspective, we'll send you a copy of the Record of Proceedings. Please review that and if you think there's anything you want to add to help our work, especially on that last question that Helen Mary asked in terms of recommendations you think we can make to the Government, then please come back to the committee and tell us that. And I know you've committed, all, as well, to sending us your reporting to Welsh Government, which would be very helpful in terms of our piece of work on this area. So, diolch yn fawr. Thank you ever so much for being with us this morning. With that, I'll let you go.

5. Cynnig o dan Reol Sefydlog 17.42(vi) i benderfynu gwahardd y cyhoedd o'r cyfarfod ar gyfer eitem 6
5. Motion under Standing Order 17.42(vi) to resolve to exclude the public from item 6

Cynnig:

bod y pwyllgor yn penderfynu gwahardd y cyhoedd o weddill y cyfarfod yn unol â Rheol Sefydlog 17.42(vi).

Motion:

that the committee resolves to exclude the public from the remainder of the meeting in accordance with Standing Order 17.42(vi).

Cynigiwyd y cynnig.

Motion moved.