Examination of Witnesses (Questions 60
- 79)
TUESDAY 23 OCTOBER 2001
THE RT
HON PAUL
MURPHY, MRS
ALISON JACKSON
AND MR
JOHN KILNER
60. The next two years in your report set out
an intended increase of 60 per cent over the base line year, that
first year, in expenditure. In the first year you were at £1,911,000,
but in the years 2002-03 and indeed the subsequent year planned,
it is running at over £3,066,000. That is a 60 per cent increase
over where you were at the starting point. There is concern here
that there is a lack of clarity in the staffing numbers. The number
39 has been mentioned, also 44 and today in your oral evidence
48. What confidence can we as a committee have that there will
not be a dissimilar disparity in next year's annual report when
it comes to spending?
(Mr Kilner) I think you are looking at
the top of Table 1 on page 26. Is that correct? Are those the
figures you are looking at?
61. Indeed.
(Mr Kilner) The year 1999-2000 was a partial year.
If you then look at the following years, it is the North Wales
child abuse tribunal effect very largely which accounts for the
total figure appearing to rise and then falling back.
(Mrs Jackson) As well as the first year only being
a partial year—and John was not involved, so he does not
remember—it took us some time to recruit a number of staff,
so our pay bill was actually lower than budgeted for. What you
are getting for 1998-99 and 1999-2000 is outturn as opposed to
plans. So although our budget for 1999-2000 was higher—I
am afraid I do not have the figures with me, but I can find them—expenditure
was in fact lower because we recruited the staffing numbers gradually,
so that the numbers built up gradually. When we started on 1 July
1999 we had very few staff which gradually built up towards March.
As far as the North Wales child abuse tribunal is concerned, the
responsibility for that was with the Welsh Office. Because of
the nature of the tribunal, it was one of the functions which
was not transferred to the Assembly, therefore the Wales Office
has had to meet the winding up expenditure of the tribunal. However,
we did not budget for that, we have transferred into the Welsh
Office budget as the expenditure has arisen in order to meet it,
with the agreement of the Assembly who had budgeted for it. Because
the Welsh Office had budgeted for it, it was therefore the Assembly
budget line, but so as not to take the whole budget from the Assembly,
we have transferred the money as we have needed it. It is very
much the staff numbers building up after the first year, which
makes it difficult to take that as a base line, and the North
Wales child abuse tribunal effect. On the running costs, the pay
bill and general administrative expenditure, we have a flat line
and the Committee can be confident that we will not spend above
that line without the Secretary of State having to go to Treasury
for agreement and without this Committee knowing that a change
has been made. At present we are working within the budget and
indeed the Committee can be confident that on present levels we
shall not be overspending.
62. I do welcome that last point in the sense
that if the department would come back to us, if there were an
intended breach of that, that would be helpful.
(Mrs Jackson) We shall certainly need to come back
to Parliament, because it would be in the estimates.
63. That is very welcome. The reason for raising
these questions is not simply the question, important as it is,
of the department's own financial controls, but because, as the
Cabinet Office's report states, one of the principal responsibilities
of the Secretary of State ministerially is to operate the financial
mechanism of the constitutional settlement. Clearly it is of concern
to this Committee that if the department's own figures are up
and down there is a worry about the ability to control the overall
financial mechanisms. That is a fundamental point which is certainly
of concern to myself and other members of the Committee.
(Mr Murphy) Alison and John have answered on the detail
but simply to repeat that because there was a lead-in from the
Welsh Office into what became the Wales Office and the Assembly,
together with the fact of external influences such as the North
Wales child abuse tribunal and also that we are comparing outturn
with plan, which is rather different as we all know, explains
the fluctuations there. It is important that we inform the Committee
of any plan changes there might be.
Chairman
64. May I also refer to Table 1 and also refer
you back to last year's report from your office?
(Mr Murphy) That I do not have here.
65. We have a copy. The planned spending by
the National Assembly for Wales for 2000-01 and 2001-02 has risen
since last year's Departmental Report by £100 million for
the first year and about £80 million for the second year.
Do you have an explanation for this? It is in Table 1 and the
2000-01 provision—it says Welsh Office, but I presume that
is because it refers to previous years—is £7,791,726.
In last year's report it was £7,691 million. There is a difference
of £100 million there.
(Mr Murphy) That was when the spending review came
in. It was the Chancellor of the Exchequer's decision to increase
spending on the National Assembly and the services which our people
use and that went into the block grant which in turn went into
the health and education budgets.
66. So that was the extra money.
(Mr Murphy) That was a very welcome increase.
Adam Price
67. On the issue of the Welsh block, on page
23 the report outlines the operation of the Barnett formula. I
am advised that has been discussed extensively in previous submissions,
but subsequent to the publication of the report, the Chief Secretary
of the Treasury announced to the House on 19 July, that the Barnett
formula was a convergence formula, that is that over time per
capita expenditure, identifiable expenditure, would converge
between Wales, Scotland and Northern Ireland and levels of spending
in England. It is referred to in the economics literature as the
"Barnett squeeze". The implication is that the rate
of increase on identifiable expenditure will therefore be less
over time in Wales, Scotland and Northern Ireland compared with
England. In the light of this, what discussions have there been
with the Treasury on the precise rate of convergence through the
Barnett formula between Wales and England? Has the department
commissioned research on alternative needs based assessment which
could provide a more generous settlement to Wales in the future?
(Mr Murphy) Might provide; I am not persuaded personally.
There probably would not be an awful lot of difference so far
as Wales is concerned. The other point which has been discussed
at this Committee in the past is that the comparison between England
and Wales might be a comparison which in the future would not
be a proper one, it would rather be a comparison between regions
of England which themselves are identified, particularly the North
East of England, which has argued for a very long time that they
are disadvantaged compared with Scotland, Wales and Northern Ireland
because they have their own problems within that region in terms
of low pay and deprivation and so on. So far as your original
point is concerned on convergence, that is not new at all because
it was part of the original Barnett formula that that was to happen.
As we go over the years, how the different budgets converge is
not something new and it was understood from the very beginning.
No, I have not initiated any research on that. The Assembly itself
might be looking at those issues, I do not know, but the whole
question of the spending review for the next three years is now
upon us and will be decided in the months ahead. We shall be looking
very carefully at those decisions and how the block grant operates
in Wales.
Chris Ruane
68. I am looking at Annex 4, page 37, the Welsh
total managed expenditure, 1997-98, which was the last year of
Conservative government. It went from £6.8 billion to £9.7
billion now and up to £11.1 billion by 2003-04. That is a
massive increase in the slice of the cake. Is it comparable to
the UK slice of the cake? Are you getting a good deal as far as
Wales is concerned? I know it is a huge slice of the cake and
I am sure colleagues on the Committee would recognise it as a
huge slice of the cake, bearing in mind that in the last year,
1997-98, there was a drop of £60,000 in the Welsh block grant
which was set by the previous Conservative Government.
(Mr Murphy) I wonder what you would expect me to say.
Expenditure in Wales has gone up faster than expenditure in the
United Kingdom. The block grant has gone up because of the special
reasons all of us know, that Wales needs the extra money, particularly
in terms of the Objective 1 funding which came to us, the structural
funding which meant that the Barnett formula was actually broken
on that occasion because of the significance of that amount of
money for Wales over the next few years. It is something like
half a billion pounds over a period of three years extra over
and above the normal block which was a great boost to Wales and
to the finances for public services in Wales.
Mr Wiggin
69. Will the Minister agree with me that on
Objective 1 it is a great shame that in the 18 months it has been
going only two per cent has been spent?
(Mr Murphy) Yes, but where I would not agree with
you is that so far as the actual amount which is committed is
concerned, that has changed considerably. It is a very different
picture from the one you paint in terms of spend. The spending
lags behind the commitment in terms of the payment of the bills.
The Wales European funding office has been committing funds on
schedule, possibly even ahead of it. For example, the target for
committing funds by the end of December of this year is £348
million and the present forecast is that it will be £395
million. Far from lagging behind, the commitment on Objective
1 is going forward.
Dr Francis
70. Will the Secretary of State compare those
figures with the English regions which are receiving Objective
1 funding and whether or not they are ahead or behind us?
(Mr Murphy) I shall certainly look at that. It is
not quite so simple to compare because the Objective 1 funding
in Wales is directly under the National Assembly, one Government
institution as it were, compared with different departments doing
different things and the regions. I am having a look at that for
my own purposes too.
71. Anecdotal evidence indicates that England
is behind us.
(Mr Murphy) I do not know. You have obviously come
across that. Anyway the committed schemes are going ahead more
quickly than we had anticipated when the scheme was drawn up.
Chairman: We hope we are ahead of the English
on that.
Julie Morgan
72. Going on to the Welsh language, on page
29 of your report you refer to your Welsh language scheme. Has
the draft scheme been published yet?
(Mr Murphy) No, but it is with the Welsh Language
Board.
73. When do you anticipate that it will actually
be published?
(Mr Murphy) I am not quite sure how long the Welsh
Language Board would normally take to consider a scheme, but I
would not have thought it would be all that long. The scheme is
in draft, it is prepared, but obviously the system is that it
then goes to the Welsh Language Board privately for their comments
upon what is in it before we would publish it, which is right
and proper. As soon as ever the board has looked at it—and
if that is necessary, I discuss contents of that scheme with the
board—we shall get that scheme out as quickly as possible
but within the remits of what is right to do.
74. Do you anticipate that will be fairly well
on track?
(Mr Murphy) Soon, I hope, yes.
Mrs Williams
75. I should like to visit the Wales Office
website with you now. Would you like to tell us how your website
has developed since we last met?
(Mr Murphy) It has developed very well. I am told,
though I know very little about websites and hits, that nearly
11,000 people have hit in October and in terms of the Welsh version,
about 885 people have decided to ask us in one month what we have
on our website in Welsh.
76. Do you consider it to be fully bilingual
now?
(Mr Murphy) Yes.
(Mrs Jackson) It is not exactly a bilingual website;
we have two parallel websites.
77. Could we explore this a little bit? When
you enter the site of the Wales Office you get an all-English
presentation. There is not a single word in Welsh on that first
page. Do you agree it would be preferable to have a simple first
page which is fully bilingual? May I bring to the attention of
the Secretary of State the fact that Coleg Menai, which
is in my constituency, is the winner of the best college website
in Wales 2001? May I ask the Clerk to pass copies of this around?
It is a very simple first page, it is fully bilingual and I would
ask the Secretary of State for his comments as to whether he would
in the overhaul consider having a fully bilingual first page?
(Mr Murphy) I am advised on two issues there: one
is that there is an all-Welsh website, so when you hit that it
is all in Welsh anyway. I also understand that the National Assembly
bilingual one would be as our Wales Office one is as well. We
shall certainly have a look at it and see what is necessary. In
terms of someone who wants to read the website in Welsh, it is
there for them to read it entirely in Welsh.
78. Will the Secretary of State accept that
you need a very welcoming bilingual message on your first page—that
is the point I am making—such as the one presented by Coleg
Menai in my constituency? For instance, if you look at the
Welsh site—I have a copy here which I printed last night,
so it is up to date—it says that information about Government
services in Wales and the proceedings of the National Assembly
for Wales are at www.wales.gov.uk. Would you consider www.cymru.gov.uk
to be apt?
(Mr Murphy) We have to be in line with what the Assembly
do. We shall certainly have a look at the points you make. I shall
take them back, have a look at the site again and see what it
looks like. Generally speaking if we are consistent with what
the Assembly are doing on their website and also because we have
a specific Welsh language website, I shall take back what you
have said and take a look at that and the practicalities of that.
79. I have done my homework and I have a copy
of the National Assembly for Wales page as well. It is quite clear
what their policy is. All I am asking is that the Wales Office
make that first page a welcoming bilingual page such as the one
Coleg Menai is presenting. You might win a prize, like
Coleg Menai, at the end of the day.
(Mr Murphy) I shall certainly take that back and have
a look at it.
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