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Select Committee on Welsh Affairs Minutes of Evidence

Examination of Witnesses (Questions 160-179)



  160. The end of July?
  (Mr Sparks) Yes.

  161. Well, it seems to me that you have to be giving it by the end of this month.
  (Mr Sparks) No, the end of January to the end of July will be six months. The 31 January to 31 July will be six months.

  162. So the end of January?
  (Mr Sparks) That is right.

  163. So you are not in a position to say now that you will fund until July 2003?
  (Mr Sparks) It is March 2003. That came as a proposal asking us to indicate our willingness to enter into discussion about that and that is what we will do and that will be discussed on Thursday. Presumably if there is willingness to move that forward, it could move very quickly in January.

  164. I am still concerned about how much money you will be able to put in for this gap. Would you not feel with all that has happened in this sorry saga that you should find the money to plug that gap and keep those projects going until July 2003? It seems to me that that is the very least you could do so that there can be proper negotiations to ensure that the threat of redundancy can be lifted early on.
  (Mr Nall) I do apologise for re-raising this point, Chairman, but the issue is that the Society has a deficit in the current year of £4 million a year. It has postponed needed investment in its training and development to ensure the very best safe practices for children and young people. It has to re start pension contributions and that is clearly important to staff, that they have secure pensions. There are expenditure needs which require the cuts to be made. We are looking at sums at the margin to extend as far as possible the work in Wales. The sort of sums we are looking at are around £600,000. That is probably what it will cost financially to close the work in Wales. The subsequent question then is, "Is there scope for augmenting that at all?" That is in addition to the endowment funds we have already talked about which we very much want to go to be the basis of further work in Wales, either continuing our own work or other work if that is not possible. Now, the basic problem in Wales is the very large continuing contribution required to keep that work open, and that contribution is over £100,000 a month and if fundraising income, which is quite likely, falls sharply in Wales, that contribution will rise to £150,000 a month, perhaps more, and that gives us a limited period. We would very much like to extend the work in Wales. We do not wish to close the work in Wales, but there is a deficit and it must be tackled and that does impose very tight constraints which we would wish to explore in terms of extending the work.

Mrs Williams

  165. On that briefing, I would like to make a point. At point 10 you write, "The Society's objective is to ensure . . .", objective does not mean the same thing as commitment, does it?
  (Mr Nall) Commitment and objective require feasibility. If it is not feasible it cannot be done. We wish to explore the constraints on feasibility to maximise the possibility to continue the work.

  166. But you would agree that objective and commitment are two different things? You are trying to link them now because it is convenient for you.
  (Mr Nall) You are trying to distinguish them because it is convenient for you. Commitment and objective, you are quite right, are two different things. We have an objective to try and secure the continuing work. We have a commitment to do so. We have appointed specific planning resources to explore the options with staff in Wales, to assist them in creating a business plan, to nail down all the details of funding arrangements and the position of partners and what they may be able to contribute, working with the line management in Wales who, you would be right to suggest, best know the situation. That is a commitment. It is a commitment backed by money which is in short supply, and we wish to do everything we can to explore the opportunities of maintaining the work. However, there is a million a year funding gap. That has to be found, and I would welcome a commitment from the National Assembly for Wales and from the other partners in Wales to work out how that £1 million a year can be found. If we can find that £1 million a year, it is not just the next year we get through, we sustain the work long into the future. That, after 113 years, would be very much the Society's preferred outcome from these negotiations.

  167. You mention the National Assembly for Wales now in your answer, we have established early on I think that you have not even approached the National Assembly for Wales.
  (Mr Nall) We will be approaching them with the business plan.

  168. It is a bit late for that, is it not?
  (Mr Sparks) Just so we do not confuse the issue. There is a group trying to set up their own charity which will take over from the Children's Society in Wales, they have produced a business plan. One of our staff, as Charles has referred to, has given them some help because he has experience in writing business plans, but that is their proposal, not our proposal.

  169. Do you now regret not approaching the National Assembly before now?
  (Mr Sparks) The problem is the issue is not about Government funding but the issue is about voluntary income, and I am not sure that would have changed the position. As Charles said, we are talking about a one million funding gap in our own resources, not about the level of funding which would come from the National Assembly.

  170. Have you not heard the word "partnership"? In Wales we work as partners in order to provide the best service possible for our clients.
  (Mr Sparks) Yes, and there is a partnership. Most of the work has a partnership of one sort or another, but I did not see, and I have not heard any evidence so far, that approaching the National Assembly would have resolved that. As Charles has described, it is a financial problem, it is about resources.

Julie Morgan

  171. On a different matter, it seems to me that this Task Group you are working with has actually been set up by the National Assembly to try to rescue the services.
  (Mr Nall) They are two different groups.
  (Mr Sparks) They have very similar titles. There is a Task Force which was set up by the Minister for Health and Social Services, Jane Hutt, chaired by Christine Walby, which is the meeting we are going to on Thursday. There is a Task Group of staff who are trying to set up their own charity separate from that.

  Julie Morgan: Does it not seem to you that you should have been involved in doing this, setting up these groups and working with the different organisations to try to find some solution?

  Mrs Williams: If you had commitment, you would.

Julie Morgan

  172. These two groups have been set up as a result of your actions.
  (Mr Sparks) But the solutions they are working at are the solutions which arise from the trustees' decision, they are trying to find ways forward on the basis of the decision the trustees have made. We are quite clear we need to have mechanisms for looking at the way forward, and these are useful mechanisms for that but they are not resolving the basic question.

  173. But the mechanisms have been set up by the National Assembly and by the staff themselves, who must be pretty disillusioned with their organisation. I am sure any sort of surveys of staff satisfaction in Wales towards your organisation would be very grim at the moment.
  (Mr Sparks) I am sure they would.

  174. Absolutely. I want to be quite clear, you will be making a decision before the end of January?
  (Mr Sparks) No.

  175. On how much money you will be able to put in?
  (Mr Sparks) No. Our directors and I[5] will be going to the meeting on Thursday on the basis of saying that the Society is willing to make some contribution towards the process of continuing to March 2003. Also we will be saying, if we can reach a conclusion before the end of January, that would be very helpful because it would avoid the need to get into notice of impending redundancies and other things like that, so it would smooth the whole process for the staff involved. But, clearly, there are other parties who have to say what they can do and what they are willing to contribute.

  176. What are you willing to contribute?
  (Mr Sparks) I think that is subject to the discussions which take place there. The director has a remit to go and say, "We are willing to contribute" but clearly there are going to be negotiations about what people can offer towards that.

  177. But surely in that situation you need to go with a clear view about how much money you can get to put into these negotiations? I do not see what it can be dependent on. Surely you can work out how much money you can put in to save the situation in a way?
  (Mr Nall) I have already indicated that the cost of closing the work would be around £600,000. A far better use of that money would be to continue to work. I have also indicated that the issue facing the Finance Committee is how much further would they be able to support that work. I am afraid, it will be to a limited degree. There are other issues which need to be addressed within Wales, such as who can continue that work. What we would like to do is maintain the fund-raising activity so it does not wither, and that is what obviously it is doing at the moment, partly because of the confusion. Some of the money is currently going to the Archbishop's Fund and we need to draw those strands together so that the maximum available resource goes forward. Within Wales now I would imagine, as you have indicated, there is enormous frustration and anger at the decision which has been taken. That does, however, provide an opportunity for a coherent fund-raising package to try and put the work in Wales on a more successful footing for the future as regards voluntary income.

  178. So you have £600,000 to close down the work in Wales, so there is potential for that £600,000 being used to keep it going?
  (Mr Nall) Precisely, but the longer the work goes without resolving the £1 million gap, the swifter that money disappears.

  179. If you do reach an understanding and you are able put in money to keep the services going in some way until March 2003, would you in that situation keep the staff on your payroll and keep it as part of your organisation in that period?
  (Mr Sparks) The proposal from Christine Walby is not for the Society itself to maintain those services. This is quite a complex proposal she has put about the services being held by another body. We have to get into that. There is a whole raft of complex things about liability and that sort of thing which have to be resolved. What she has tried to do is fit together what she sees to be the best way forward, recognising the situation we are in at the moment. We are trying to co-operate with that, not only financially but with some of the legal complexities.

5   If this is a correct record this is a slip of the tongue. In response to Q156 I made it clear that our representatives at the meeting would be the director for Children and Young People who were accompanied by our Human Resources Director. It was never intended that I should be at the meeting. Back

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