AC(4)2012(1) Paper 6

Date:       2 February 2012
Time:      10:30-12:30
Venue:    Presiding Officer’s office
Author name and contact number: Claire Clancy, ext 8233

Management Board report to the Commission
February 2012

Outline

1.0 Strategic goal – provide outstanding parliamentary support 2

2.0 Strategic goal – engage with the people of Wales. 5

3.0 Strategic goal – promote Wales. 6

4.0 Strategic goal – use resources wisely. 7

5.0 Financial report 12

6.0 Other information. 13

List of annexes

· Annex A: Freedom of information

· Annex B: Minutes of Audit Committee meeting (17 November 2011)

Assembly Commission’s strategic goals

1.0 Strategic goal – provide outstanding parliamentary support

1.1 Assembly business update

1.2 Committees

a. Committees are beginning to come to the end of pieces of work they started in the summer. They have completed their evidence taking and either reported, or are in the process of producing their outputs, on:

· disability-related harassment in Wales;

· regeneration of town centres;

· children's oral health in Wales;

· community safety in Wales;

· stroke risk reduction;

· proposed reforms to Common Fisheries Policy; and

· proposed reforms to the Common Agricultural Policy.

b. In addition they have begun new work on:

· residential care for older people;

· the draft legislative proposals EU Structural Funds for 2014-2020;

· the implementation of the Learning and Skills (Wales) Measure 2009;

· the provision of affordable housing;

· the effectiveness of European Structural Funding in Wales;

· adoption; and

· public health implications of inadequate public toilet facilities.

c. Committees are also planning and undertaking visits to inform their work, and exploring the use of external expertise where that appears to offer benefits.

d. Members and staff are continuing to adjust to the flexible styles and working practices needed to support the level of committee activity. Some committees have already begun to evaluate the approach they take to their work as a committee, and to seek adjustments in the support they receive where they feel improvements can be made.

1.3 Assembly Bills

a. Six Bills are expected to be introduced during the 2011-12 Assembly Year. The first Bill, the Local Government Byelaws (Wales) Bill, was introduced by the Welsh Government on 28 November. The Bill has been remitted to the Communities, Equality and Local Government Committee with a deadline for Stage 1 of 30 March 2012.

b. The Assembly Commission is also expected to introduce the National Assembly for Wales (Official Languages) Bill in early 2012.

1.4 Draft Bill update

a. The Food Hygiene Rating (Wales) Bill consultation closes on 7 March 2012. The Health and Social Services Committee have agreed to receive a briefing from Welsh Government officials to help inform their understanding of the Bill.

1.5 Members’ Ballots

a. On 19 October, the Presiding Officer announced that Ken Skates AM had won the Members’ ballot to submit proposals for legislation. Ken Skates has since gained the Assembly’s agreement to introduce a Member proposed Bill on Continuity from Care into Adult Life, in accordance with Standing Order 26.91.

b. 0n 29 November, the Presiding Officer announced that Peter Black and Mohammad Asghar had won the Members’ ballot to submit proposals for legislation. In accordance with Standing Order 26.91, Peter Black and Mohammad Asghar may now each seek the Assembly’s agreement to introduce a Member proposed Bill on Park Homes and on Enterprise respectively (scheduled for 1 and 8 February).

1.6 Assembly Measures

a. The Children and Young People Committee is undertaking a review of the implementation of the Learning and Skills (Wales) Measure 2009.

b. This is the first Assembly Measure to be reviewed and the Committee’s report is expected to be published in Spring 2012.

1.7 Constitutional and Legislative Affairs Committee

a. During the autumn 2011 term, the Constitutional and Legislative Affairs Committee considered 47 Statutory Instruments. It issued specific reports on 20 of them, including 15 on the merits of the instruments concerned. The Committee also considered 2 Legislative Consent Memorandums.

b. Since September 2011, the Committee has been conducting an Inquiry into the issues surrounding the granting of powers to Welsh Ministers through Westminster Bills. The Committee has now concluded the Inquiry and has agreed an outline of its report and recommendations and will publish its final report in the current term.

c. The Committee has also started an Inquiry into whether there should be a separate Welsh jurisdiction. Written evidence has been called for and oral evidence taking will start early in the new term. Among other witnesses, the Committee is hoping (with the assistance of the Director of Legal Services) that senior members of the judiciary will be willing to give oral evidence to the Inquiry.

1.8 Remuneration Board

a. Between January – March the Remuneration Board will be considering the implementation of its Determination on Members’ Pay and Allowances, based on feedback received from Assembly Members. Subject to the Board’s discussions, a revised Determination incorporating any amendments will be issued for 2012-13.

b. In a letter to all Members in December 2011, the Chair of the Remuneration Board indicated that the Board would undertake a review of Members’ pension arrangements. The review will take place during 2012-13 and any decisions will be published in 2014. This will be a participative review, and the Board will consult with all relevant stakeholders throughout the process.

2.0 Strategic goal – engage with the people of Wales

2.1 Wales Governance Centre

a. The Wales Governance Centre’s (WGC) move to the Pierhead is on schedule for the end of March at the latest. Meetings between WGC staff, Security and the Police will begin in late January/early February to discuss WGC staff responsibilities and duties for ensuring the security of the Assembly estate.

b. The Deputy Presiding Officer, Adrian Crompton and Non Gwilym met with Professor Richard Wyn Jones to discuss the programme of events that the Centre will deliver in line with the Commission’s goals. A draft programme will be available shortly.

3.0 Strategic goal – promote Wales

3.1 International activities update

a. The Presiding Officer and Deputy Presiding Officer have recently welcomed a number of international dignitaries to the Assembly estate, including HRH Prince Seeiso (High Commissioner to Lesotho), HE Mr Ahmet Ünal Çeviköz (Turkish Ambassador to the United Kingdom), HE Mr Michael Žantovský (Czech Ambassador to the United Kingdom), and Mr Gordon Campbell (High Commissioner for Canada). Ms Anne Hedensted Steffensen, the Danish Ambassador to the UK, visited the Assembly in January to mark the beginning of the Danish Presidency of the Council of the EU.

3.2 British Council

a. On 7 December, the Presiding Officer met with the Chair of the UK British Council, Sir Vernon Ellis. During the meeting, both parties agreed a set of principles which will underpin the future working relationship between the Assembly and British Council.

4.0 Strategic goal – use resources wisely

4.1 Audit Committee

a. Minutes from the Audit Committee meeting on 17November 2011 are attached at Annex B for information.

4.2 External challenge

a. Commissioners will recall that we undertook a series of external challenge reviews in the autumn, as part of the budget process for 2012-13. These were led by the Commission’s independent advisers and two senior colleagues from other parliamentary bodies (the House of Lords and Houses of Oireachtas). They identified some positive approaches, including a number of areas where Assembly services are seen as exemplar – such as the Member learning and development programme; the standard contract of employment for Members’ support staff; and being the only parliamentary body to publish only electronic versions of the Record.

b. As well as pointing to areas of real strength, Directors and Heads of Service took away some clear points for enhancing the performance of their areas. These are already influencing their plans and approach. For example:

· being scrupulous about the accuracy and quality of written communication;

· evaluating our efforts properly so that we are clear about how effective and successful we are being;

· working more closely with Assembly Members to ensure that we are meeting their needs and doing things that they support;

· thinking beyond the immediate issues - get the right balance between short and long term planning;

· resisting gold-plating everything;

· keeping up the pressure on VFM, efficiency and performance;

· getting the balance right between in-house delivery and external contractors;

· managing peaks and troughs of work, and the flow of business, including using resources across teams effectively;

· considering the commercial potential of some of our work;

· using the skills and experience of our own people to bring on new talent; and

· finding ways to stimulate the desire for change and continuous improvement.

4.3 Facilities management contract – confidential until 25 January 2012

a. Following a competitive tendering process, the facilities management contract has been awarded to Norland Managed Services Ltd for five years, with an option to extend for an additional one year period with effect from 1 April 2012. The facilities management contract includes maintenance and management of the Assembly estate, estates advice, professional services and window cleaning and involves expenditure of about £925,000 per annum.

4.4 Industrial action – 30 November

a. On 30 November 2011, employees of the Commission joined other public sector workers across the UK in a national one-day strike over plans to change their pensions. An analysis of the impact across each of the Commission’s service areas is shown in the following table:

Service	Number of staff	Number of staff on strike	Percentage of staff on strike
Commission & Member Support	21	6	28.57%
Committee Service	22	16	72.73%
Communications	22	4	18.18%
Estates & Facilities Management	26	10	38.46%
Financial Services	16	5	31.25%
Front of House	34	14	41.18%
Governance and Audit	16	6	37.50%
HR	12	2	16.67%
ICT	15	8	53.33%
Legal Services	11	4	36.36%
Legislation and Chamber Services	24	16	66.67%
Research Service	35	23	65.71%
Security	57	27	47.37%
TRS	41	33	80.49%

TOTAL	352	174	49.43%

b. The public sector unions met in December to discuss the state of the negotiations and to start planning the next stage of the campaign, which we understand that PCS believes needs to include further strike action as early as possible in the New Year if progress cannot be made.

4.5 Staffing update

a. Following an improved offer to security staff to change to new working hours, there were extra volunteers from those who had chosen to remain on the old patterns, although 12 staff remain on these patterns. In accordance with the Commission’s preference to move to the new working patterns on a voluntary basis, a recruitment exercise was undertaken to ensure that we have sufficient staff to cover the Assembly’s requirements, including seven day opening, and Plenary sessions or events that continue into the evening. Induction of the new entrants is ongoing and the new work patterns were introduced from 3 January 2012.

4.6 Severance scheme

a. A limited voluntary exit scheme is being offered to all Assembly staff. The Scheme, which was launched during the first week of January, is designed to ensure that the Commission’s staffing complement and structure is capable of supporting the delivery of outstanding parliamentary support during the Fourth Assembly by:

· allowing the organisation to respond to shifts in our skill requirements;

· improving workforce efficiency;

· facilitating organisational change; and

· delivering long-term savings where possible and avoiding additional costs in meeting skill shortages.

b. Applications will be considered by a panel which will include one of the Commission’s Independent Advisors. The Trade Union Side (TUS) has been invited to observe the panel. Decisions to allow staff to leave will be driven by business need and a robust set of criteria have been developed to support the assessment of applications.

c. Consultation with TUS concerning the scheme has taken place.

d. In addition to this scheme a separate voluntary exit scheme has been offered to the security team.

e. Decisions will be made in the current financial year for both schemes and the costs arising from both schemes will fall to the current financial year (2011-2012).

4.7 Recruitment of ICT director

a. Applications for the position of ICT Director closed on 12 December. A large field of applications was received. A robust assessment process was put in place to support the selection process. A stakeholder group of Assembly Members and Assembly staff will provide an opportunity for shortlisted candidates to meet with key stakeholders on 26 January before the formal interviews on 27 January.

b. The interview panel will be Claire Clancy, Angela Burns AM, Peter Black AM and Tim Knighton (Director of Business Solutions Delivery at Companies House with responsibility for IT and change management services).

5.0 Financial report

5.1 At the end of December 2011, the Commission’s £32.328m budget showed an actual position of £21.916m against a profile of £22.652m. Although this is an under spend of £0.736m (3 per cent), which exceeds the 2 per cent tolerance, there is no risk to the year end position. The most recent Assembly Services’ forecast indicates the year end position will deliver an under spend nearer to 1 per cent, although much will depend on the progress of projects and the costs of restructuring in the last quarter. Project progress is a particular risk, with just over 40 per cent of year’s work completed to date, leaving the balance to be finished in the last quarter. Regular reviews are held to mitigate this risk.

5.2 The Assembly Members’ budget is showing a £0.65m under spend to date (6 per cent) which is expected to reduce to £0.5m or 4 per cent by the end of the year. This is an increase of £0.2m from that previously reported at the 24 November meeting. The fluctuation is caused by changing patterns of Members’ claims and support staff turnover rates, both of which are showing different expenditure patterns to previous years. This is to be expected in the first year of the new Assembly following a 38 per cent change in membership.

5.3 In line with decisions at the November meeting, arrangements to return £1.8m unused election budget from the Assembly Member’s budget will be included in the Welsh Government’s 2011-12 Supplementary Budget. This provides the maximum opportunity for Welsh Government to utilise these funds. The balance of Assembly Services’ £0.2m is to be managed through the year end outturn rather than formally relinquishing resource through the Supplementary Budget. This change provides the maximum benefit to the Commission to deliver its last quarter’s work and has minimal impact on the Welsh Government.

6.0 Other information

6.1 A list of information disclosed since the last report under the Freedom of Information Act is attached at Annex A. The full disclosure can be provided to Commissioners on request.

Bwyllgor Archwilio Comisiwn y Cynulliad
Assembly Commission Audit Committee

NAFWC ACAC
Minutes of 17 November 2011
Time: 11:00
Venue: Video Conference Room, Tŷ Hywel

Minutes of 17 November 2011 meeting

Present:
Richard Calvert (Independent Adviser) (Chair – Video Link)
Tim Knighton (Independent Adviser)
Professor Robert Pickard (Independent Adviser)
Angela Burns AM

Officials present:
Claire Clancy, Chief Executive and Clerk
Dianne Bevan, Chief Operating Officer
Nicola Callow, Head of Finance
Lynne Flux, Head of Internal Audit
Ian Pennington, KPMG
Richard Harries, Wales Audit Office
Mark Jones, Wales Audit Office
John Grimes, Head of Governance
Alison Rutherford, Secretariat

Item 1- Introductions

1. The Chair welcomed attendees. No apologies had been received.

Declaration of Interests

2. No interests were declared.

Minutes of meeting held on 07 July 2011

3. The minutes of the previous meeting were agreed.

Matters Arising

4. Claire Clancy informed the Committee that the new Head of Procurement, Jan Koziel, was now in post. He would be reviewing the existing procurement processes, building on the development of the existing team, and reappraising the overall procurement programme.

Item 2 - Internal Audit – follow up on previous investigations

ACAC(10) Papers a – h. Summary of action on outstanding internal audit recommendations

5. The Committee considered the papers detailing updates on progress on recommendations of Internal Audit reports from the 2010/11 and the 2011/12 programme.

6. Lynne Flux said that she was pleased with progress against the recommendations, that there were mostly valid explanations for slippage, and that testing would be undertaken in due course to check the robustness of the work to implement the recommendations.

Payroll

7. On the Payroll audit recommendations, the Audit Committee noted the importance of using appropriate reports in relation to employee data. Nicola Callow clarified that no reconciliation or review process had been stopped. As the recommended audit approach had not delivered the expected benefits, the emphasis was on ensuring a more efficient review through amending work flows.

UNO report

8. The Committee emphasised the importance of building and maintaining an appropriate working relationship with Atos (formerly Siemens). Dianne Bevan told the Committee that a paper would be presented to the Commission at its next meeting setting out options for the future provision of ICT services.

9. Claire Clancy added that recruitment of the new IT Director was underway, and that this appointment, along with the new Head of Procurement would place the Assembly in a stronger position inholding Atos to account. The Chair was content that these issues were receiving the management attention that was necessary.

Item 3 - Internal Audit – latest investigations

ACAC(10) Paper 3a. Summary tracking report of progress on internal audits

10. Lynne Flux introduced the paper noting that there had been some adjustments to the timing of delivery of assignments to fit in with financial budgeting and other work being undertaken. She reported that she and the Chief Operating Officer were working to circulate the report on Information Security and Data Protection to the Audit Committee by Christmas.

11. The Audit Committee asked whether Lynne Flux was content with the level of resourcing committed to the Audit Programme. Lynne said that she was happy with the relationship now established with KPMG and the programme of work that had been completed. She was confident the audit programme will be delivered. She advised that there is now an opportunity to appoint an apprentice, which would enhance internal capacity.

ACAC(10) Paper 3b. Internal Audit report– Fraud risk management and controls

12. Lynne Flux presented the report to the Committee, which showed that staff have a good understanding of the risks occurring and the controls in place to mitigate those risks.

13. The Chair highlighted the importance of ensuring that the procedures and guidance are written in a way that does not deter internal or external whistle-blowers coming forward and ensuring the privacy and safety of potential whistle-blowers is clear. Mark Jones added that the Auditor General for Wales is a prescribed person under the Whistle Blowing policy.

ACAC(10) Paper 3c. Fraud, corruption, and bribery policy

14. The Audit Committee endorsed the draft policy and emphasised the importance of making the guidance digestible for staff, and the benefit of using practical examples of how fraud and corruption could occur in certain areas, particularly contract management.

ACAC(10) Paper 3d. Internal Audit interim report – Asset management

15. Ian Pennington provided an overview of the first phase report and its recommendations noting that the remaining testing is scheduled for February 2012. The Audit Committee accepted the interim recommendations.

ACAC(10) Paper 3e. Internal Audit update report – Management of website content

16. Lynne Flux outlined the findings. The review highlighted the importance of clear responsibility and ownership of content on the website. Lynne told the committee that work was underway to identify information owners and provide guidance and training to them, to ensure that timely updates are provided in a well controlled way.

17. Tim Knighton suggested that the soon to be implemented Government Digital Service will provide a standard for public service websites and would be a good source of guidance for the Assembly’s website. The Chair emphasised the necessity of ensuring that controls are in place for content and that the website manager has the authority to hold the information owners to account.

ACAC(10) Paper 3f. Internal Audit report – Members’ Allowances and Expenses

18. Lynne Flux introduced the report which was the first internal audit review of the controls covered by the new Determination. Generally, the controls operating through the Members’ Business Support Team (MBS) were robust and effective.

19. There were a few minor recommendations which focused on evidence rather than processes, and Lynne reported that the MBS team had begun to implement these. No inappropriate claims were identified. Mark Jones assured the Committee that the work the WAO would complete next year would cover a different sample of members.

20. Overall, the Chair commented that there was more evidence of testing the risks and controls for 2011-12 than had been reported at the equivalent stage in 2010-11. He was encouraged by the work that had been completed on the audit programme.

Item 4 - External Audit

ACAC(10) Paper 4a. Management Letter

21. Mark Jones introduced the Management Letter which showed that the 2010-11 accounts were certified and laid in July this year, with no material errors. He commented that there was less in the Management Letter compared to earlier years due to continued improvements.

22. Mark Jones commented on the reduction in retrospective purchase orders from 68% to 25%, but he felt that raising awareness and detailed guidance on the use of retrospective purchase orders could help to decrease this figure further. Other areas highlighted were the need for stronger documentation of virements, stronger disaster recovery testing, Logica user access to be tightened and specific access levels set for CODA. Appropriate management responses had been received in all instances.

23. In response Nicola spoke of the positive discussion between finance officials and the WAO. She noted the further reduction in retrospective purchase orders and the work that had already been completed in addressing the management letter points. A brief discussion of the budget virement process followed.

ACAC(10) Paper 4b. Draft 2011-12 Audit Outline

24. Richard Harries introduced the draft 2011/12 audit outline for agreement, a high level plan based on risk assessment. Richard reported that work with Internal Audit had informed the process and that they would ensure as much work as possible would be completed before year end.

25. Richard advised there was no audit fee in the outline which normally would be included. The public sector fees were currently being moderated at the WAO, but he assured the Committee that details of the proposed fee would be forwarded within the next few weeks.

26. The Chair noted that a comprehensive set of risks had been included and the Audit Committee agreed the outline.

Item 5 - Assembly Commission Governance

ACAC(10) Paper 5. Commission budget update

27. Nicola Callow introduced the update on the Commission’s 2011-12 and 2012-13 budgets and Claire Clancy added that the Commission’s new strategy and goals were set out in the draft budget and would guide service planning.

28. Angela Burns explained that the budget was required to provide the outstanding parliamentary service necessary for the assembly and Assembly Members to meet expectations. The priority for the next four years would be to improve the understanding of the people of Wales of the Assembly.

Item 6 - Other items

ACAC(10) Paper 6a. Departures summary

29. The Audit Committee agreed that it was useful to review the departure reports regularly, and noted it would be beneficial to include more detail about the extension of existing contracts where these are mentioned.

ACAC(10) Paper 6b. ACAC Forward work programme

30. John Grimes asked the Committee to consider the forward work programme and advised that the draft agenda would be considered in January.

Item 7 - Private discussion with WAO

31. The Committee held a private discussion with the representatives from the WAO and agreed there were no points for action.

Date of next meeting

32. The next meeting will take place on 09 February 2012.