Examination of Witnesses (Questions 300-319)
30 NOVEMBER 2004
LORD WHITTY,
MS OONA
MUIRHEAD AND
MR ROBIN
MORTIMER
Q300 Chairman: But there are different
sources of advice. You have got strong policy advice within your
own Department, the National Rural Affairs Forum is going to continue
in one shape or form and we are going to have this kind of revised
rural advocate part of what is left of the Countryside Agency.
Who does what between those? Why do you not just say, "We're
the Department and we're going to set policy"?
Lord Whitty: Well, you know, Chair,
Defra no longer takes this entirely Stalinist approach to things.
Q301 Chairman: That is news from you!
Lord Whitty: We no longer think
we know everything. Can I just correct one thing you said, that
the National Rural Affairs Forum will not be maintained under
the new structure, but the regional ones will and they will feed
into the new Countryside Agency, so there will not be any duplication
there. Of course it is very important that I can rely on the expertise
of officials and my co-ministers, but it is also important that
we have somebody slightly at arm's length who has the authority
and the resources to be able to criticise us and suggest different
ways of doing things and do so, not necessarily wearing a Defra
hat, with other government departments.
Q302 Chairman: So this is an open and
listening Department?
Lord Whitty: Absolutely.
Q303 Chairman: Let me ask you about the
Forestry Commission because that was an area of some debate within
Haskins and eventually it was decided that it was not to come
into the new Integrated Agency. Just again explain why that is
the case and what the linkages are going to be because there are
going to have to be some fairly clear linkages.
Lord Whitty: Yes, I think the
distinction between policy and delivery is being applied in relation
to the Forestry Commission as well in that the broader policy
function of the Forestry Commission will come into core Defra,
so that will be parallel, although the Forestry Commission is
a sort of odd beast in some ways. The management of forestry and
forestry expertise and the areas that are related to that, it
did not seem to us sensible to put all of that management role
into the Integrated Agency. I think there has to be with land
management a lot of co-operation between the Integrated Agency
and the Forestry Commission, but certainly at this stage it did
not seem sensible to us to transfer the function into the Integrated
Agency because they are somewhat different. It is also true of
course that the Forestry Commission is a GB body, so there is
quite a lot of forestry in the devolved administrations and we
have all, us as England and the devolved administrations, felt
that there is advantage in maintaining a single body in that respect,
so there are quite good reasons for keeping the Forestry Commission
separate. However, the Forestry Commission is very much part of
the Rural Strategy and needs to engage with the Integrated Agency
and the other bodies.
Q304 Chairman: You said "at this
stage", so does that mean that you might come back to this
issue?
Lord Whitty: I am not necessarily
saying that. I do think that with the creation of the Integrated
Agency, we can see how that then runs and there may be some adjustment
needed down the line, but at the moment I cannot see that there
is an overwhelming case for incorporating the Forestry Commission
in the Integrated Agency and indeed there are significant downsides
of so doing. It is a relatively successful body and we shall continue
supporting it in its present structure and we will see how the
relationship between the various bodies works out over time.
Q305 Mr Jack: On the Forestry Commission,
do I understand it that you are going to have, as a Department,
overall policy control and effectively the delivery of forestry
services is going to be the Commission's new role?
Lord Whitty: Broadly speaking,
yes. There are forestry issues, policy forestry issues which Defra
will take over and there will be parallel arrangements in the
devolved administrations and also international obligations which
Defra will broadly take over, so yes, the Forestry Commission
will become more a management body than a policy body. As you
know, it is sort of half-way between an agency and a government
department at the moment, so that will change, but the number
of personnel when switched in that context is pretty small as
we are talking about a small function of the Forestry Commission.
Q306 Mr Jack: So just let's get this
right. Defra are now going to be directly responsible for all
commercial decisions in bringing major forestry—
Lord Whitty: No.
Q307 Mr Jack: They are not? So if you
are going to set the policy, surely that must, by definition,
define the commercial decisions or the boundaries within which
the Forestry Commission can operate?
Lord Whitty: Well, only insofar
as general government policy informs everybody's commercial decisions,
but we are not taking the commercial and the land management function
away from the Forestry Commission. That will continue to be their
role. It is the broader issues of overall policy which we will
take into the core Department and, as I say, some certain international
dimensions of that.
Q308 Mr Jack: Let's move on to cost savings.
What are the financial implications of the new world into which
we are moving because Lord Haskins forecast cost savings of £29
million per annum when he made his report? What is your current
estimate of the situation?
Lord Whitty: Well, we are not
quite as sanguine as Lord Haskins, but we reckon at the end of
the process that we should make £20 million worth of savings
a year.
Q309 Mr Jack: Well, let's just examine
this thing called "the process". Just take us through
in a little more detail what the process is because will there
not have to be some up-front investment to get this new bird off
the ground?
Lord Whitty: Yes, we reckon, roughly
speaking, it will cost us £40 million to implement.
Q310 Mr Jack: Over what timescale?
Lord Whitty: Over five years,
is that?
Ms Muirhead: Yes.
Lord Whitty: It will reach break-even
point in five years' time, so we are talking about 2009-10 to
begin to see the benefit, which is more or less the same time
period as Haskins was saying, and the figure we are putting on
it is slightly more cautious than his.
Q311 Mr Jack: Does that money include
the establishment of the associated IT system?
Lord Whitty: It includes any new
requirements on IT, but of course a lot of the IT systems were
already in the pipeline or operating, so it is only extra money
that is involved in that. For example, it does not include the
follow-through on the ERDP, the related programme of Genesis 2
which is the IT system there because that was already required
before we decided to make these institutional changes.
Q312 Mr Jack: Mr Taylor is going to probe
a little further and you have given him a little sort of flavour
to start off his thought processes. How much in terms of the difference
between what you thought the Integrated Agency might save and
what Lord Haskins calculated was disturbed by the fact that you
kept on, if you like, a rump Countryside Agency whereas he got
rid of it?
Lord Whitty: Not much, but have
we got the exact figures?
Ms Muirhead: I have not got the
exact figures to hand, but Lord Haskins did anticipate that there
would be an expert body set up within the National Rural Affairs
Forum of around 18 to 20 people, so actually he did envisage some
additional cost there which of course we are not putting in instead,
but we are retaining a very small, well-focused, new Countryside
Agency, so I do not think that those costs are likely to be in
any way significant.
Q313 Mr Jack: Can I just stop you there
a second, before I ask you one final question about where some
of this money is coming from, because these various fora, I am
a bit confused because we have got the National Rural Affairs
Forum and then we have got some various fora at regional level.
Lord Whitty: That is what we have
got now, yes.
Q314 Mr Jack: What do they do?
Lord Whitty: Well, the national
forum is quite a wide stakeholder body, which deals with rural
policy broadly. We discuss all sorts of matters related to rural
policy there from the Rural Strategy, the Rural White Paper, the
follow-through to that, and we discuss CAP reform there as well.
Q315 Mr Jack: How often does it meet?
Lord Whitty: Quarterly, roughly.
Ms Muirhead: Well, the National
Rural Affairs Forum has actually now been stood down, so it does
not meet anymore. It did until last month or the month before,
so until very, very recently it did.
Q316 Mr Jack: So does it have a resurrection
once the new Integrated Agency—
Ms Muirhead: No, it does not.
Lord Whitty: The new Countryside
Agency will perform the role that the national rural affairs policy
originally envisaged it performing and which Haskins envisaged
it would perform.
Q317 Mr Jack: So the new Countryside
Agency is going to have to find its own consultative mechanism
to inform itself?
Lord Whitty: Well, maybe, but
it will inherit the existing Countryside Agency's contacts in
that respect and the regional rural affairs fora will be maintained
in being as the regional rural feed-in to the new Countryside
Agency.
Ms Muirhead: Perhaps it would
be helpful if I just explained a little bit of the rationale behind
that.
Q318 Mr Jack: Just tell me who is on
them.
Ms Muirhead: Well, I think we
would have to give you the membership separately. They differ
within each region because clearly for each region what is important
is the institutions and the bodies and the stakeholders that matter
in that particular region and each region's priorities are different.
Chairman: Perhaps you could let us have
a note of each one.
Q319 Mr Jack: I asked a question about
this at the last Defra Question Time and I did not get a proper
answer, so perhaps you could include a proper answer in the note.
Mr Michael sort of somewhat circumnavigated my question. Let me
just ask then the final point about funding. You are going to
have to find £8 million a year. We are always being told
how tight your budget is. Who is putting up the extra cash or,
conversely, where is it coming from?
Lord Whitty: Well, the whole Defra
modernisation and rationalisation programme will save us money,
so through this Spending Round we expect to shrink the total size
of the core Department and shed substantial numbers of staff and
improve the efficiency of our activity through new IT systems,
some of which are virtually there and some of which are down the
line, so we are talking about a smaller total spend on administration
than we previously were, so the difference between £20 million
and £29 million in 2010 will have been absorbed by earlier
efficiencies.
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