60. Do you have an idea
in your head of percentage, which you can give the Committee?
(Mr Davies) It is not possible to operate in that
way, Mr Jones. There is a spending limit attached to each department,
or local authority and so on, and they will have to decide whether
they wish to proceed by means of PFI or by means of direct provision.
I think PFIs can be a useful and imaginative way of getting partnership
between the public and private sector. It is not possible to say
"I want to have 10 or 15 PFIs" because it will merely
depend on the size of each PFI. Obviously, the smaller they are
the more you can have.
61. Is there a correlation between the future
planned reductions in capital expenditure and planned total investment
under PFI?
(Mr Davies) Very much so. I inherited a very,
very substantial reduction in capital expenditure. It is something
which certainly worried me when I was in opposition, from 1992,
seeing year-after-year the reduction in capital expenditure. I
believe that our infrastructure in Wales has suffered grievously
as a result of the previous government. It would be nice to think
that we had sufficient resources to remedy those deficiencies
at a stroke, but the world is not like that. The mechanism which
is available to me, however, to carry forward infrastructure projects,
is PFI, and if that is the means at my disposal to bring about
improvements to the economic prospects and the social provision
in Wales, I will use it and I will use it as enthusiastically
as I can.
62. Do you think that by the end of your
term it may be the principal mechanism for such projects?
(Mr Davies) I certainly know that by the end of
my term we will have made PFI work. I have no doubt at all that
projects such as the one I have referred to earlier in south Cardiff,
and certainly the A55 across Anglesey—and others which are
very, very significant in bringing capital expenditure into our
public services, while retaining those public services as public
services—will make a very significant improvement. I cannot
say, at this stage, Mr Jones, whether PFI will provide the majority
of capital expenditure, I am afraid, largely because, of course,
these matters, after next year, will not be at my discretion,
they will be decisions taken by the Assembly.
Mr Edwards
63. In the introduction to the report you
talk about the key aims objectives and targets which you are setting.
How seriously do you take the issue of target-setting? With respect
to certain targets, like "securing an inclusive society",
what criteria would you wish to see fulfilled before you would
feel that such a society has been created?
(Mr Davies) There is a general question and a
specific question from Mr Edwards, Mr Jones. First of all, I attach
great importance to the system of targets. I think that is self-evident;
if I did not attach importance to them I would not set them. I
think it is understood that the purpose of setting targets is
so that you have a system whereby officials and the department
itself knows what it is striving to achieve, and you do have a
mechanism whereby people outside can judge the effectiveness of
what you are doing and the effectiveness of your policies. I do
attach great importance to that and we do look very carefully
when we set targets. As far as a definition of "an inclusive
society" is concerned, it is very difficult, and I take the
point which is implicit in Mr Edward's question that you cannot
set targets for when an inclusive society will be achieved. However,
there are elements of target-setting which relate to that—educational
achievement, for example, levels of truancy. Certainly, we have
talked about the health indicators. I think elements of the incidence
of crime, the incidence of homelessness—all of those are
factors which we have to look at in trying to see whether we have
got an inclusive society. Win Griffiths has responsibility in
the Welsh office for developing the policies in parallel with
the initiative taken in England on the Social Exclusion Unit.
I want to make sure that we set targets in those areas I have
referred to—in terms of the performance of health, educational
achievement and so on—and we will pursue those independently.
The Social Exclusion Unit is looking at ways in which we can get
a better integration of the delivery of public services, using
what is in the Welsh Office, the health authorities, the local
authorities and so on, to try and get a more co-ordinated and
holistic approach. I do not think we will have one single indicator
which says "We have achieved an inclusive society because
this target has been reached"; rather, I think, we will have
a range of other targets, all of which will have to indicate whether
we are moving towards a more inclusive society.
64. Has consideration been given to having
a Social Exclusion Unit for Wales?
(Mr Davies) This is the working party that Win
Griffiths currently has. He is working on that. I am not confident
of the date, but his report is likely to be published in the not-too-distant-future.
Mr Livsey
65. You say that it is not always possible
to agree targets for Non-Departmental Public Bodies before the
Departmental Report goes for publication. (I assume we are talking
about quangoes here.) Can we take it that where targets do not
appear in the Departmental Report they are agreed before the beginning
of the financial year to which they relate?
(Mr Davies) I am not sure if I understood your
question, Mr Livsey. I think the problem is that the targets had
not been agreed by the time the report was finalised. The programme
of setting targets and agreeing with public bodies is one which
does take some time, obviously.
66. It is not an entirely satisfactory situation.
Is this something you inherited from the previous government,
do you think?
(Mr Davies) I think you are referring particularly
to the powers, because I know of the concerns you have expressed
previously about the future of the DBRW. I would ask you to accept
the fact that there has been a very, very substantial re-organisation
of the three bodies which are coming together for powers, and
it has been time-consuming. It was not until just after Christmas
that we were able to agree the structure of the new powers—the
senior management structure—and the role which will be played
by each of the in-coming partners in the structure of the new
body. That, in itself, was time-consuming and, inevitably, delayed
the process of agreeing targets with them. I am pleased that we
managed to reach agreement some months ago on the new structures,
and we did very rapidly then move forward.
67. We certainly noted that. When do you
now expect to get these expenditure plans and targets? When will
they be available, do you think?
(Mr Davies) I cannot give you a precise day, but
what I can say, Mr Livsey, is that we expect them imminently and
as soon as they are agreed, of course, they will be made public
in the normal way and a copy will be placed in the library.
68. These plans will be comparable with
the kind of expenditure that has occurred in the different bodies
that now comprise the power house?
(Mr Davies) I have been pressed on this question
in different circumstances, and I have been asked to ring-fence,
as it were, certain money for the DBRW area—or certain money
for local authority operations. I am very reluctant to do that,
partly because I think it will impose an unnecessary straight-jacket
on the new powerhouse. If, for example, we were to have a huge
new programme of investment in massive abattoir facilities and
meat packing facilities, it may well be that we will want to increase
the amount of money which went to the DBRW area, and it would
hinder that process if we were to ring-fence each of the components.
What I want to do, therefore, is make sure there is maximum flexibility
at an operational level for the powers, but that then there are
very clear policy guidelines set for the powers. One of those
policy guidelines is, obviously, to give greater attention now
to (and I come back to the question which Mr Llwyd asked me sometime
ago now) to the rest of Wales other than the south-east, and to
look not only geographically for a wider target but also in the
other sectors. So we will want to look at the indigenous sector
(the small and medium-sized enterprises)—look at food promotion,
look at how we can encourage rural initiatives, and so on. I want
flexibility for the powers.
69. Thank you very much for that very full
reply. We wait with alacrity to look at these figures.
(Mr Davies) I am not sure how you wait with alacrity,
but I think I know what Mr Livsey means!
Chairman
70. I am glad you do! In a sense this is
an end-of-term report, on one year in office. How effective do
you think your department has been in that time?
(Mr Davies) How my department has been?
71. Yes.
(Mr Davies) That is a very difficult question
to answer, because my department follows the lead that I give
them. I would answer the question at two levels. First of all,
the effectiveness of the political lead which has bene given to
the Welsh Office is a matter for the people to decide, and they
will in the normal, democratic course of events. As far as my
department is concerned, I personally am very pleased. There have
been one or two areas where I have been less than pleased with
a performance. I think that the department concerned and the individuals
concerned know that, and I have taken the necessary action to
try to put it right. A very good example is the question of payment
of subsidies to farmers. It is a matter which I believe could
be resolved by firm leadership. The present system needs very,
very substantial change. It became clear to me that however much
I chivvied officials, however hard officials worked and however
much overtime was worked, it was not possible to deliver the sort
of service that I wanted, given the existing machine. So we have
taken the decision that the machine itself will have to be overhauled.
So there are examples like that, but I think we are making improvements
and I think, by and large, the people of Wales are served very
well by the men and women who work in the Welsh Office.
Mr Llwyd
72. Very briefly on that point, could there
be any merit in, perhaps, looking at the way in which these subsidies
are paid out in Scotland? I understand the Scottish model has,
for many years, been most successful and farmers have been paid
on the due dates without any quibble whatsoever. Could we, possibly,
learn by experience or share common experiences with the Scottish
Office?
(Mr Davies) I will look and I will ask my officials
to look anywhere for any experiences which can be necessary. I
have indicated to them that I want them to talk to colleagues
in the Ministry of Agriculture, and, following the suggestion,
I will make sure that if there are any experiences from Scotland—or
if there are any experiences from the private sector—which
will enable us to get this system put right, then that is what
I will look at. I will, as I have done, keep all Members of Parliament
representing Welsh constituencies fully informed.
Chairman
73. There is another example, Secretary
of State. We note in the report that the target of replying to
ministerial correspondence within 12 working days was met in only
70 per cent of cases, while in 1995/96 your predecessors managed
82 per cent.
(Mr Davies) There is a fundamental difference
between the two regimes— I have tried to say "yes"
in my letters!
Mr Llwyd
74. Trying is not good enough!
(Mr Davies) There are two points I would make,
Mr Jones. First of all, there has been a very, very substantial
increase in the output of ministerial work. I think, in fact,
there was a survey conducted a few months ago, and I think we
are talking about 2.5 times the volume of work that my predecessor
did. That is not only in terms of decisions and of action taken,
but also of letters. Inevitably, that has put certain strains
on, and we are having to introduce changes in the private office
to deal with that. It is also the case, Mr Jones, (and my first
answer was not entirely fair) that I do try to ensure that when
answers go to Members of Parliament they are full and they do
attempt to assist. Certainly, if I might say—and I do not
say this in any way critically of staff who were dealing with
correspondence when I took office—there was a desire to
get a letter out as quickly as possible, regardless of the content
or quality of it. Certainly initially, on a number of occasions
I had to send letters back, to say that I was not satisfied with
either the tone or the way in which the enquiry had been dealt
with. I think we are getting it right, but it is not something
you can do straight away. You do have to change the culture and
the attitude of people. If it results in us missing the target
of speed of reply, I hope we are reaching the target of satisfactory
letters being sent.
Mrs Williams
75. Is the Welsh Office marching as quickly
as you would like as far as information technology is concerned?
I am thinking of E-Mail, and all the rest of it. Do you think
the department is moving fast enough for our liking in 1998?
(Mr Davies) I certainly think so. We do have a
new system in operation and, judging by the volume of E-Mails
which fly around, we are up with the best. I will ask, however,
Dr Roberts, if he could give you a reply, because he will be more
familiar with the precise details of that.
(Dr Roberts) We are indeed implementing an information
systems strategy, we are reviewing it at the moment, with a view
to implementing it not only for the Department but looking ahead
to the Welsh Assembly as well. So we have that very much in mind
for the future.
Chairman
76. You may have a lot of E-mails flashing
about, Secretary of State, but we could not get one from you today
on information for the Committee. Have you any ideas for structural
changes in your Department that you have come cross?
(Mr Davies) My pre-occupation during the last
twelve months has been the constitutional changes for which I
have had direct and personal responsibility. Now that the Bill
certainly is out of the Commons and seems to be getting increasingly
broad support in the other place, I am now looking at the changes
which will need to take place within the Department to reflect
the needs and demands which are likely to be put on it by the
Assembly. To that extent, I have had to listen very closely to
the expressions of opinion I have received, and I will obviously
look very closely at the final report of the National Assembly
Advisory Group I have got. If there are any substantial structural
changes, it will be done in the light of what I think the pattern
of delivery of the Assembly is likely to be. I certainly do not
have any proposals for any immediate change, other than the ones
we have talked about this morning.
Mr Livsey
77. Is there any reason, Secretary of State,
while we have such a huge rural and agricultural crisis, another
minister could not be appointed to see us through this time, so
that more focus could occur on the situation which is confronting
the rural areas of Wales at the present time?
(Mr Davies) The number of ministerial appointments
is one, of course, entirely for the Prime Minister. What I will
say to Mr Livsey, however, is that Win Griffiths is the Minister
for Agriculture and the Countryside and I have taken a very close
personal interest in the matter myself. I have to say, frankly,
I do not think the addition of another minister would have made
any difference at all. It may well have been there would have
been another minister available to explain the Government's case
and to listen to representations, but I do not think the outcome
would be any different from that which it is now.
78. I feel that it is not satisfactory that
this particular remit, given that Wales is a very rural country,
is shared amongst other responsibilities. I give you full credit,
I think you have worked extremely hard on the issue, but you are
a very busy man in other sectors as well.
(Mr Davies) That is right, but the problem is
on many occasions people who want to make representations want
to see the Secretary of State. My concern would be, even if we
were to have another minister—and there is no likelihood
of that but if we were—I still think that representatives
of the farming industry would say, "Yes, that is all very
well, but we want to see the Secretary of State." I think
it is inevitable, when there is a problem—and I acknowledge
the severity of the problem—people want to see the Secretary
of State, they want to feel they have taken their case to the
top, as it were.
Mr Edwards
79. On that point, Secretary of State, you
may appreciate the frustration some of us have felt when we have
wanted to take matters to do with agriculture to the top, by which
we mean the Minister of Agriculture, who is responsible in the
Cabinet for agriculture and is involved in most discussions in
Europe. Yet, when we write to the Minister of Agriculture, we
get letters back from the Under Secretary of State. I make no
criticism of the Under Secretary of State, but somehow representing
the people we are representing we feel we would like to get answers
sometimes from the Minister of Agriculture, and that would reduce
the number of letters coming out of your Department as well.
(Mr Davies) Of course, it would! The Minister
of Agriculture is not exclusively responsible for agriculture
in the Cabinet. The Minister of Agriculture is the lead minister
but there are three territorial ministers, myself and the Secretaries
of State for Scotland and Northern Ireland, who are also agriculture
ministers. If it is the case that Mr Edwards wants to get a fuller
reply, I suggest he expresses his view to the Minister of Agriculture
or those working closely with the Minister of Agriculture. All
I can say is that I have a departmental policy and certainly if
Mr Edwards were to make representations to me about the quality
of my letters——
