House of Commons - Health Committee

Department for Constitutional Affairs - Health Committee Contents

Response from the Department for Constitutional Affairs to the Committee's written questions on the Department for Constitutional Affairs Departmental Report 2005-06

PSA TARGETS

GENERAL

1. In its answers to questions last year the Department said that the NAO's review of its PSA data systems had not yet been completed. This review should now be finished. Will the Department share the resulting report with the Committee?

The NAO review was completed and the Department sent copies of the report to the Committee on 16 June 2006. Actions that need to be implemented are being taken forward by the teams responsible for the delivery of PSA targets.

2. In its report into Fines Collection, the NAO highlighted that the performance measures currently used to track performance in this area were not the most appropriate and suggested a number of alternative, better measures. Has the Department made an assessment of its PSA targets to see if similar criticisms might apply? If so, does it intend to alter any of the measures it currently uses?

HM Treasury is co-ordinating work, as part of the wider CSR2007 programme, to build a shared understanding of how the existing performance framework could be refined to further enhance successful delivery. We are contributing to that work, which will be used to set the parametres within which we will, with colleagues in HM Treasury, begin more detailed discussions about the content and level of PSA targets as part of CSR 2007. We do not, however, propose to alter the measures currently used for SR 2004 PSA targets.

3. Could the Department please update the Committee with any changes to performance against its PSA (both 2002 and 2004) and other targets which have happened since the publication of the DAR? If there have been any significant changes can the Department please explain these?

SR2002 PSA targets

PSA 1 is a target we share jointly with the Home Office and the Crown Prosecution Service. Three of the PSA 1 performance measures were met. Measure 2 was to improve performance in all criminal justice areas and this was not met even though 40 out of the 42 criminal justice areas did improve their performance.

PSA 2 is a joint CJS Agency Target managed by the Office of Criminal Justice Reform. PSA 2 achieved two of its targets (improving the level of confidence in the criminal justice system and improving ethnic minority confidence). Two were not met: increasing year on year the satisfaction of victims (where performance remained at the baseline figure of 59%); and increasing year on year the satisfaction of witnesses (although performance improved from 57% to 59% this was not statistically significant).

Final outturn for PSA 3 and 4 was detailed in the Departmental Report. The final outturn on PSA 6 is expected in spring 2007.

PSA 5 is the asylum target which is joint with the Home Office—three of the four measures are the responsibility of the Home Office. There is no additional performance information available on the measure (the number of substantive asylum applications, including final appeal, decided in six months) delivered by the DCA.

PSA 7 (VALUE FOR MONEY) HAS BEEN ACHIEVED.

SR2004 PSA targets

PSA 1: the Departmental Report showed that 1.267 million offences were brought to justice by December 2005. The latest figures we have show that 1.319 million offences were brought to justice against a target of 1.25 million (March 2006).

Performance against PSA 2 remains at the same level—although the figures in the Departmental Report were for December 2005 and we now have figures for the full 2005-06 financial year the percentage figures have not changed.

No further performance data is available on PSA 3 at present.

PSA 4 measures the proportion of care cases being completed in the courts within 40 weeks. The figures in the Departmental Report were for the 2005-06 financial year. We now have figures for April to July 2006. These figures show that performance has fallen from 45.9% to 42.6% in County courts and from 56.1% to 54.5% in magistrate's courts.

There are three measures for PSA 5. Performance data for the first will not be available until spring 2007.

Performance against the second measure has changed from 41.3% (February 2006) to 41.7% (July 2006) —the target is to reduce the proportion of disputed claims in the claims that are ultimately resolved by a hearing from 40.5% to 38.5%. The answer to Question 11 below sets out the reasons for the change in performance against this target.

Performance against the third target, which is to increase the proportion of small claims hearings which take place within target time from 79.9% to 81.5%, has improved from 83% (February) to 83.4% (July).

PSA 1 (OFFENCES BROUGHT TO JUSTICE)

4. This target will be achieved if 1.25 million offences are brought to justice in 2007-08. Given that the latest outturn figures show that this target is already being exceeded does the Department consider that the original target was too easy? Will it now alter the target to make it more challenging?

This PSA target is a target we share jointly with the Home Office and the Crown Prosecution Service. At the time the target was set, bringing 1.25 million offences to justice in 2007-08 was considered to be a very challenging goal. In 2003-04, 1,077,000 offences were brought to justice, and so achieving this target in 2007-08 would constitute a 16% increase on this, and a 25% improvement on the figure for 2001-02.

The sharp rise in performance over the last two years has been driven in large part by the increased use of pre-court disposals: cautions, and the relatively new disposals of formal warnings for the possession of cannabis and penalty notices for disorder (PND). These last two disposals have been widely taken up by the police to deal with relatively low-level offending and keep such cases out of the courts, and greater numbers of offences have been brought to justice through these means than had been anticipated.

Although current performance is above the target level of 1.25 million, we recognise, as do other criminal justice agencies, that in order to meet the target this level of performance needs to be replicated in 2007-08. This will demand considerable ongoing effort to ensure that, against a backdrop of crime reduction targets, the reforms that have been introduced are properly embedded in criminal justice processes. As such, we do not intend to revise the target.

We have recently set out an ambitious programme of reform to rebalance the criminal justice system in favour of the law-abiding majority, and to deliver justice more efficiently, that will build on the improvements we have already made and help us sustain the current high level of offences being brought to justice.

5. Given that the overall crime rate changes from year to year why is this target an absolute figure rather than a percentage of all crime?

When the target on bringing offences to justice was set in 2002, it was decided to make it an absolute figure as this sends a very clear and simple message of achievement to criminal justice agencies and practitioners. However, in calculating the level of the target in 2004, a range of variables were taken into account to ensure that it represented a realistic but challenging level of ambition. These included current levels of crime, future crime reduction targets and the rate of sanction detections to recorded crimes achieved by the police and the Crown Prosecution Service. In setting targets for local criminal justice boards (LCJBs) we also take account of an area's success in converting sanction detections to offences brought to justice. We then consider this and the other variables mentioned above against the backdrop of an area's recent performance to ensure that local targets are set at the appropriate level and reflect the differences between areas, such as the mix of crimes recorded and the comparative use of different disposals.

We identified a number of difficulties attached to having a target to bring a certain percentage of crime to justice. It would be possible, at a time when recorded crime has been falling, for a percentage target to be achieved without bringing more offences to justice. We believed that this would send the wrong message to both criminal justice agencies and the public, and that is why the decision was made to set the target in terms of an absolute figure.

6. This target makes no distinction between types of crime and so does not measure how many violent and other serious offences are brought to justice in comparison to the number of less serious offences brought to justice. Thus an improvement in bringing less serious offences to just could mask problems with dealing with serious offences. Does the Department have figures showing this comparison; if so can it please provide these to the Committee?

The target only recognises recorded[2] offences which are brought to justice, and so in this sense covers the more serious range of overall crime. However, recorded crime, as a category of overall crime, clearly itself includes a spectrum of more and less serious offending.

There have been considerable improvements in bringing less serious recorded offences to justice in the last two years, as evidenced by the significant increases in the numbers of cautions, penalty notices for disorder and formal warnings for cannabis possession. However, these improvements have not been achieved at the expense of continuing to bring more serious offences to justice.

There has been a 31% increase in the number of violent offences (violence against the person, sexual offences and robbery) brought to justice between 2002-03 and 2004-05. There were 265,000 violent offences brought to justice in 2002-03, and this rose to 347,000 in 2004-05. This represents a 2.5% increase in the percentage of recorded violent crimes brought to justice in this period (up from 26.8% to 29.3%). In addition to this the percentage of prosecutions for violent offences that result in a conviction has improved in the last five years from 47.5% in 2000 to 54.9% in 2004, showing that advances have been made in bringing to justice those more serious violent offences that come before the courts.

Although the target itself does not distinguish between the types of offences which are brought to justice, we do publish data on the numbers of the types of offences which are brought to justice, and the proportion of all offences brought to justice which they account for. The latest published data on this is set out below. We are currently considering ways in which a greater focus can be placed on ensuring that LCJBs achieve increases in the number of serious offences which are brought to justice, in the context of the improvements already achieved in the overall volume of offences brought to justice.

Number of offences brough to justice by offence type, 1998/99-2004/05(1)

England and Wales	thousands of offences and percentages
Type of Offence	1998-99	1999-2000	2000-01	2001-02	2002-03	2003-04	2004-05
	number of offences (thousands)
Violence Against Person	215	223	213	216	236	259	318
Sexual Offence	16	15	14	15	15	15	16
Burglary	96	87	75	76	81	77	69
Robbery	10	10	11	13	14	13	13
Theft and Handling Stolen Goods	390	381	352	348	337	362	327
Fraud and Forgery	89	93	82	79	77	73	75
Criminal Damages	96	100	94	95	96	104	113
Drug Offences	146	132	114	119	133	117	160
Other Notifiable Offences	46	43	41	42	49	58	58
All notifiable offences	1,103	1,084	996	1,002	1,038	1,077	1,150
	percentage of all offences brought to justice

Violence Against Person	20	21	21	22	23	24	28
Sexual Offences	1	1	1	2	1	1	1
Burglary	9	8	7	8	8	7	6
Robbery	1	1	1	1	1	1	1
Theft and Handling Stolen Goods	35	35	35	35	32	34	28
Fraud and Forgery	8	9	8	8	7	7	7
Criminal Damages	9	9	9	9	9	10	10
Drug Offences	13	12	11	12	13	11	14
Other Notifiable Offences	4	4	4	4	5	5	5
All notifiable offences	100	100	100	100	100	100	100

1. Figures for 2004-05 are provisional.

Why is there not a target specifically relating to serious and violent crime?

One value of the PSA target is its simplicity. This both provides a clear incentive to criminal justice agencies to improve the number of offences they are bringing to justice, and allows LCJBs to monitor effectively progress against the target. Introducing sub-targets for different types of offences would complicate this and place a further series of burdens on LCJBs and those agencies responsible for delivering performance improvements.

A further benefit of the current target is that it allows LCJBs the freedom to determine how they will go about meeting it. While serious and violent crime is clearly always a priority, not specifying targets in this regard provides greater flexibility for local areas also to focus activity and resources on other community concerns, often lower-level offending affecting residents' quality of life. Imposing further targets on LCJBs relating to violent and serious offences, or any other types of offences, would reduce the autonomy with which criminal justice agencies can respond to local priorities.

It is also the case, though, that the fundamental elements of successfully bringing an offence to justice through the courts—thorough police investigation, sound charging decisions, good case preparation and progression, effective victim and witness support, robust enforcement of bail breaches and efficient management of the courts—do not vary significantly between different types of offences. Therefore the range of reforms we have introduced in recent years to improve the basics of the criminal justice system have helped to enhance the system's performance in bringing to justice all the offences it deals with.

PSA 2 (CJS Confidence)

7. How vulnerable is this target to swings in public perception due to significant news events?

PSA 2 is a joint CJS Agency Target managed by the Office of Criminal Justice Reform. Public confidence is monitored by Research Development and Statistics Section in the Home Office who are responsible for the managing the questions on public confidence that feature in the British Crime Survey.

It is difficult to attribute changes in levels of public confidence to specific events in the news/media although associations can be inferred. We do know that the media is an important factor and that people get their information about the CJS from national and local media.

The impact of significant news events is assessed on an ad hoc rather than an on-going basis. Two examples in recent years where the impact on public confidence was monitored were the Terrorist Bombings in London in July 2005 and the General Election in May 2005.

The Terrorist Bombings did not appear to have a negative impact. In fact, data from that period suggests that the public felt that the police dealt with these incidents in a professional manner and they acknowledged the difficulties they faced at that time, thus public confidence did not suffer.

There did seem, however, to be a negative impact on the perception of the public at the time of the General Election in May 2005 when there was a lot of media coverage concerning criminal justice issues. Confidence figures dipped for the only time during the SR02 period in June 2005 but they rose again in subsequent quarters so there was only a short term impact. The latest figure of 44.4% (Mar 2006) is the highest figure yet.

Does the Department have any method of monitoring changes over the year in between the annual surveys which provide the main data for this target?

The British Crime Survey is a rolling annual survey which interviews over 50,000 people taken from a random sample. The data on public confidence in the criminal justice system is published on a quarterly basis, so we are able to monitor changes over the year.

PSA 3 (Reduce unfounded asylum claims)

8. Recent revelations about the Home Office highlight the poor quality of data relating to asylum seekers. How can the Department be sure that the data it uses to assess this target is valid?

The measure for this target is to "reduce unfounded asylum claims" and is a Home Office measure. The Department for Constitutional Affairs (DCA) contributes to this target by ensuring a speedy and effective appeals process.

The data to measure performance is provided by the Home Office Immigration Nationality Directorate (IND). However, IND and Asylum & Immigration Tribunal (AIT) databases share a data exchange process which updates information at the various stages in the appeals process from when an appeal is lodged with the AIT through to the service of the judge's determination by IND. Control mechanisms are in place to check and cleanse data periodically, ensuring the integrity of, and high confidence in, appeals-related data.

Are the poor data systems likely to lead to yet further increases in the backlog of asylum appeals cases?

Hearing centres in the AIT have management information reports which are used to manage the progress of cases through the appeals system. A case tracking report is used which allows centre managers to monitor the progress of each individual asylum case if necessary. In addition, AIT uses robust methods to validate the information in its database and in IND's equivalent.

Together these measures give a high degree of confidence in data on asylum appeals. That data shows there is only a small backlog of cases where a possible error of law has been identified in the original decision and the appeal is waiting to be reconsidered before a panel of Immigration Judges.

PSA 4 (Care cases)

9. Has the Department made an assessment of the reasons for the difference in performance between County Courts and Magistrate's Courts?

We have assessed the factors affecting performance in the county courts and in the magistrates' courts, but have not made a detailed assessment of the reasons for the differences. The main difference is that more complex cases are heard in the High Court and county courts. Because of this complexity, cases in the county courts often take longer to resolve, hence the lower target level. The average case length for the period April to July 2006 is 44 weeks in the magistrates' courts and 52 weeks in the county courts.

Have lessons learnt been shared between the two court systems?

Lessons learnt have been shared between the county courts and magistrates' courts. A key example is The Protocol for Judicial Case Management in Public Law Children Act Cases which is a distillation of best practice and was implemented in November 2003. It was the first national statement of common practice and solutions. Work is underway to revise this document in light of The Review of the Child Care Proceedings System in England and Wales (published 18 May 2006) and a separate review by the judiciary of the Protocol in 2005.

Other key examples of sharing lessons learnt include work to integrate the family courts to achieve greater flexibility in listing and court arrangements—several areas across the country have already implemented local schemes. The creation of the inter-agency Local Family Justice Councils (created 2005) provides a further opportunity for identifying and sharing best practice through the national Family Justice Council. HMCS Performance Directorate also facilitates a "virtual" multi-agency group which tests potential good practice ideas before sharing more widely through the Family Justice Council and existing HMCS networks eg regional family fora.

PSA 5 (Earlier and more proportionate resolution of legal problems)

10. Are the results for the first part of this target now available? Is it on course?

The Legal Services Research Centre's continuous survey has not yet built-up a sufficiently robust sample size to give an indication of performance against the target. We expect meaningful data to be available from February 2007 as we will then have 12 months worth of survey data.

11. What are the key reasons for the slippage in part two of this target?

There has been a significant increase in the number of claims being issued in the county court over the last 12 months, most of which are for relatively low amounts that are subsequently allocated to the small claims track. These claims have less propensity to settle than higher value claims, probably because the people involved tend not to be represented by lawyers. Any increase in small claims, therefore, will invariably increase the proportion of claims that proceed to a court hearing.

We hope to alleviate this by increasing the opportunities available for people with lower value disputes to settle their problems earlier. In particular:

— We are improving the level of information available to court users to equip them better to negotiate a settlement or otherwise find a consensual solution to the dispute (utilising the lessons learned from our Small Claims Support Service piloted at Reading over the last year);

— We are running a further national awareness campaign in October to increase public knowledge about mediation (building on the success of "Mediation Week" last year); and

— We are looking to make the In-House Small Claims Mediation Service, piloted successfully in Manchester over the last year, more widely available at other major court centres in England & Wales.

Governance

12. The Capability Review says that " . . . more needs to be done to ensure that non-PSA priorities (which are increasingly at the top of the corporate agenda) are managed as effectively and accountably as the PSA targets." What plans does the Department have for doing this in the interim between now and when new PSA targets are set under the Comprehensive Spending Review?

The Departmental Management Board and Ministerial Executive Board both receive monthly performance reports on progress against not only PSA targets but also key programmes and projects, high profile initiatives and other work of interest to senior officials and ministers. Performance of the Department's portfolio of "mission critical" programmes and projects is overseen by a Director level group and supported by the Department's Centre of Excellence for projects and programmes.

What procedures has the Department put in place for identifying new issues that emerge after PSA targets are set to ensure that they are effectively monitored in the absence of formal targets?

The Department regularly reviews its performance management and reporting processes to ensure they cover all key issues and areas of work. The Capability Review recognised the connection between Ministerial strategy and the Department's alignment. Since the PSA was set the Department has embarked on many key programmes eg introduction of Freedom of Information, unification of the courts. The Department also has a robust risk management process for identifying new issues and risks as they emerge. The Department's management board receive regular reports on key risks and any remedial action required to mitigate or control the risk.

13. The Department's response to the Capability Review says: "We have proved we can deliver change through what we have already achieved with the setting up of HMCS, the creation of the Tribunals Service, the constitutional and legal reforms—and above all through improving the service we provide to the public." (page 5) The review rated the Department poorly on delivery with two areas needing urgent development and one needing development. Given this assessment how can the Department claim that it has proved it can deliver?

The findings of the review recognised the significant amount of change and the "excellent change programmes (that) have been delivered or are underway". Evidence illustrating our capability to deliver includes:

— The creation of HM Courts Service. In April 2005 DCA brought together 43 organisations to create HM Court Service as a new executive agency. The size of DCA almost doubled with the creation of HMCS and from the first day of operation the organisation has delivered high-quality services to the public making real progress against its performance targets.

— The creation of the Tribunals Service as an executive agency in April 2006, to provide support to the judiciary and tribunals users to ensure the impartial and efficient operation of the tribunals it administers. The Tribunals Service was formed by bringing together the administration of the largest central government tribunals, with the jurisdiction of some extending across the whole of the United Kingdom.

— The Constitutional Reform Act 2005 was implemented in April 2006, with the exception of the powers to create the Supreme Court which will commence when the Court opens in 2009. The Judicial Appointments Commission for England and Wales, the Judicial Appointments and Conduct Ombudsman, and the Office for Judicial Complaints were all established on 3 April.

All of the above organisations were created and delivered on time. Furthermore:

— Through effective engagement with the public, stakeholders and judiciary, we have delivered an innovative solution to involving the local community in delivering our services through the establishment of a Community Justice Centre (CJC) in North Liverpool. The Centre brings together a number of judicial services under one roof—a courtroom, criminal justice agency staff on site and scope for advice and support services needed by victims of crime, offenders, and members of the local community. Elements of the CJC are being rolled out to a number of other centres nationally.

future delivery

14. The Capability Review rated the Department as being strong on strategy but unable to effectively translate that strategy into delivery. the review says that " . . . further work is needed on achieving follow-through, converting strategies into practical programmes and deliverable plans . . . ". The actions outlined in the Department's response do not seem to directly address this issue. Can the Department explain how its planned actions will ensure sound strategy results in effective delivery?

Translating of strategy into delivery requires corporate engagement. All DCA business areas are committed to, and support this: Each has contributed to the DCA business plan for 2006-07 which describes specific activities planned to deliver on our priorities. We will be producing a three year DCA business plan for the period 2007-08 to 2009-10 with targets supported by an understanding of how they will be delivered.

Managing the scale of change is one of the department's top organisational priorities and a key issue identified in the Capability Review and in our improvement plan. Actions in the plan will improve our ability to translate our overall change vision into action on the ground through the collective management of change activity.

15. According to the summary of the Capability Reviews, each of the four departments has signed up to a plan to improve capability in each of four areas. Can the Department provide the Committee with a copy of this plan clearly indicating the intended timetable?

We have developed an improvement plan covering a 24 month period which has been shared with all DCA staff. A copy of this is enclosed.

16. The Home Office is one of DCA's main working partners. The Home Office is facing a significant amount of rapid change and this may impact on the working relationship between the two departments. Has the Department made an assessment of the likely impact of problems and changes at the Home Office on its joint working practices and ability to deliver joint targets?

There is ongoing, regular and frequent engagement between DCA staff and staff at the Home Office, both on a formal and informal basis. Our main interaction with the Home Office is through our work together on the Criminal Justice System. The Office for Criminal Justice Reform is the forum through which the DCA and the Home Office work together on criminal justice and it ensures that both parties are kept informed of any changes that may impact on the other. In addition to the OCJR, senior ministers and officials from the Home Office and the DCA also meet regularly at the National Criminal Justice Board (and officials meet at the OCJR Operational Board) where potential problems can be identified and plans made to mitigate them.

There is also an interface between the Home Office and the DCA on immigration matters and the Chief Executive of the Tribunals Service sits on the Extended Immigration and Nationality Board to ensure that avenues of communication are kept open. In addition to these high level boards, each of our joint PSA targets has a board consisting of staff from both the Home Office and the DCA who are best placed to monitor any potential impact that events at one department might have on the other or the target.

As well as these formal arrangements, there are informal links in place whereby staff from both departments are able to discuss areas of ongoing mutual interest through their own networks.

What plans has it put in place to mitigate any risks identified?

As well as tackling risks in the fora mentioned above, there are a number of other arrangements in place to monitor and mitigate risks within DCA. The Capability Review has enabled us to identify areas of our business where we would benefit from further development to reduce the chance of many of the problems that have beset the Home Office.

From OCJR's Joint Ministerial Strategy Board down, through the IND Board and the range of joint management forums, the DCA is represented and fully engaged with delivery partners. Working closely with IND and UKvisas continues to strengthen our ability to meet joint targets across asylum and immigration—particularly in the midst of change within Home Office and IND. Through membership of the IND Board, DCA has sight of and input to that organisation's change programme as well as the wider strategy on migration.

These arrangements mitigate risk to our joint processes and delivery. In addition, key elements of the IND Review (eg New Asylum Model; Foreign Nationals deportation) feature on AIT risk registers as initiatives which will have a major impact on its business.

17. There is at present a Whitehall-wide move towards developing shared services for corporate functions. The DAR mentions the Department's plan for a shared service HR function with rollout due to be completed in August 2006. can the Department update the Committee on progress and give an indication of how it is working in the early stages?

How many people does the HR shared service cover?

The Department has been reviewing the way in which a number of corporate functions are provided within the Department as part of ongoing action to ensure that resources are deployed efficiently and effectively. As part of this we have been working closely with both Cabinet Office and the Office of Government Commerce (OGC) to ensure that our plans are consistent with the emerging government agenda on shared services. Work amongst a number of central government departments has recently concluded that DCA should develop corporate services solutions for its own needs which in due course may be made available for other organisations.

For HR, the Department has in place a centralised HR function providing services to all the main business units in the DCA family, including some NDPBs. A key stepping-stone to the development of a full shared service capability has been the project to provide a single HR system across the DCA (it is this, not the shared service, which is mentioned in the annual report), one element of our overall HR Transformation Programme. This has been split into two Stages. Stage 1 covered the migration of 12,500 employee records held on 42 separate HR systems from the former Magistrates' Courts Service into the new DCA single HR system (now called CHRIMSON), and was completed successfully in June 2006. Stage 2, which covers the migration of all other DCA employee records (including those for Tribunals and the Senior Civil Service), is now due to be completed in early November 2006. A decision was made to put back go-live of stage 2 from August (stated in the annual report) in order to provide a better fit with other work arising from the Department's Pay and Grading project, and to include additional functionality. Once fully operational the single HR system will hold the records of some 28,000 employees and will provide a platform for the further development of the HR function.

The Department is now planning to move to a full HR shared service function and work is underway to develop a detailed organisation design and Target Operating Model. We are expecting to be in a position to make a decision in November on which option to pursue, enabling operation of the shared service to commence in 2008. The initial scope for the HR shared service will be all business units within the core DCA family, including NDPBs but excluding the Land Registry and the National Archives. We will assess the benefits of providing services more widely once the function is up and running.

Does the Department have plans to implement a shared service for any other functions such as finance?

The DCA already has a degree of centralised provision of Finance and Accounting services. Transaction processing, including a range of payments services, revenue and banking, and some basic accounting services are provided to DCA, HMCS and the Tribunals Service through an outsourced contract. A number of smaller bodies such as the Judicial Appointments Commission are now being brought on board during the coming year.

The Department's strategy for shared service provision in Finance is being reviewed at present as part of a wider programme of Finance Change. Whilst the current position reflects a number of decisions over recent years, mainly reflecting Machinery of Government changes, there have been some achievements to date (eg integration of Magistrates Courts and the Tribunals Service, standardisation of processes). The future strategy will aim to build on collective experiences, improve the quality of the shared service solution and use collective power to leverage cost savings from lower unit prices. This strategy will link in with the wider Whitehall agenda as appropriate for the Department.

Our procurement activities are already shared extensively by using OGC call-off contracts or other government department contracts where these meet our needs. We undertake our own procurement where specific/niche DCA requirements exist. For example we utilise OGC travel/energy contracts, but have developed our own contracts for areas such as court reporting, fine enforcement. Purchasing activity with the department is streamlined through the use of the Government Procurement Card and the iProcurement purchasing system.

On IT provision, we have some sharing with the Home Office through CJIT, and the use of the CJS exchange. DISC will provide a further platform for sharing both within DCA and, potentially, with other departments.

We will be keeping the overall position for the provision of corporate services under review in the light of developments in the wider cross-government strategy for shared services.

18. The DAR (page 68) says that the Department conducted a skills audit across the Department in line with the Professional Skills for Government (PSG) agenda. What percentage of the Department's Senior Civil Service can demonstrate competence in all six core skill areas of People Management, Financial Management, Project & Programme Management, Analysis & Use of Evidence, Communications & Marketing and Strategic Thinking?

Soon after the Departmental Management Board approved PSG implementation in DCA, the Department ran an initial skills audit at senior levels. From that audit, about half (46%) were assessed as already demonstrating all six Core Skills. Measures currently being taken to improve the overall skills levels are detailed at the end of this section. In the future, Government Skills, the sector skills council for central government, will monitor core skills levels using the SCS database maintained by the Cabinet Office—this will improve the data quality as all SCS members are included on that database.

Could the Department provide a breakdown by core skill area?

"has successfully
demonstrated" "not yet successfully
demonstrated"

People Management 96% 4%

Financial Management 75% 25%

Project and Programme Management
68% 32%

Analysis and Use of Evidence 96% 4%

Communications and Marketing 82% 18%

Strategic Thinking 93% 7%

Was the audit a self-assessment exercise? If so what has the Department done to verify the findings?

The exercise consisted of an initial self-assessment, followed by a discussion with the line manager (during the mid-year performance review) for validation purposes, resulting in a final assessment that was submitted to the HR Directorate. A number of activities are aimed at ensuring accurate data:

— The requirement of PSG-related personal development objectives has been actively marketed with SCS members, encouraging further, focused discussions of any skills gaps with line managers.

— The latest PSG update to SCS (Aug 06) encourages the use of the National School of Government financial management e-learning package as an additional diagnostic tool to corroborate initial assessments. (Financial management was identified as one of the DCA's key skills gaps.)

— DCA has set up an internal Operational Champions' Group, chaired by the Department's Head of Profession for operational delivery (Peter Handcock, Chief Executive Tribunals Service). Their first priority is accuracy of data and initial thinking (as at August-September 2006) is to conduct a more rigorous skills assessment exercise across all of DCA's operational arms.

— An action learning set, with a focus on leadership, has been established to consider PSG implementation for policy roles. This group reports to the DCA's Head of Profession for policy delivery (Rod Clarke, Director General Strategy).

— The DCA has initiated a Service-wide discussion on consistency/accuracy of assessment—Government Skills have facilitated the establishment of a cross-Dept group looking at this issue, including possible use of PSG-linked 360 feedback tools.

The Capability review said that the top 250 people in the Department were put through a rigorous assessment centre. Was this based on the same skill set as the skills audit?

There are two elements here that make up the 250 people: approximately 150 SCS members within the Department, and a further 100 people at spans 8 & 9 (the "Feeder Grades").

The SCS assessment centre was initially designed to help DCA assess the leadership capability of the existing cadre. A programme of assessment centres was rolled out between September 2003 and February 2004—all existing SCS attended. The assessment centres also formed part of the selection process for senior posts within the newly-forming HMCS. The centres were designed around 12 key behaviours (drawn from the then current SCS competency framework) considered essential for taking the Department through its change programme. The centres are now used as part of the SCS recruitment process and DCA is committed to continuing their use to help assess and develop leadership capability. The original assessment centres did not use the same skills set as the skills audit. They were designed in autumn 2003 and based on the SCS competences and DCA leadership capabilities in use at the time. When the PSG core skills were signed off by Cabinet Office in summer 2005, we commissioned a refresh of the assessment centres to ensure that they now use the PSG framework.

In summer 2004, DCA launched a development programme for Spans 8 and 9 with approximately 100 places available. Those on the programme attended a development centre to help identify their areas of strength and development needs against the SCS competencies. (As above, the centre was designed around the then current SCS competence framework.) Participants were then offered targeted development opportunities, such as roles to help them develop their people management skills. The programme was not only aimed at those who wanted promotion or had potential—it was also aimed at those seeking to raise their game, needed some development help to make a step change or who felt stuck in a developmental rut and needed some help to move on. Due to funding constraints, we are not running a second programme at this time. However, staff development remains a key role for all line managers. Any future development programmes will be designed around PSG requirements and the Leadership Qualities.

What plans has the Department got to ensure any gaps in skills are addressed?

Key skills development areas for DCA are Leadership, Financial Management and Programme & Project Management. A number of measures are in place:

Leadership and Management

The DCA's Leadership Action Learning Group is developing a number of activities:

— Continuing Professional Development—principles are being applied to SCS performance management to assist in raising leadership capability.

— Leadership Action Learning Sets—opportunities for mutual coaching and development dealing with issues of real value to the organisation—two Sets were launched in August 2006: PSG Policy Delivery and Change Management Capability.

— Team Coaching—a menu of options will be available during 2006

L&D improvement project—a project to revamp the structure, roles and products provided by Learning & Development in HR; including aligning product design to PSG skills.

Financial Management

The Corporate Finance Training & Communications team have an internally-run training course which covers the main Core Skills for those new to financial management and also acts as a refresher for those who are not. They are managing the roll-out of the Treasury-sponsored development packages (currently e-learning for basic awareness and a series of modules for intermediate levels).

Programme and Project Management (PPM)

The Programme and Project Assurance Office (PPAO) have two contracted training courses available as standard via Learning & Development in HR. Other development that is being bought in during 06/07 are: Senior Responsible Owner Masterclasses, Gateway Review training and Project Board performance support; as well as less formal measures such as buddying/mentorship and talent identification initiatives.

The PSG intranet pages have been expanded and updated, providing full guidance on skills assessments and suggested development options for all core skills.

The Department has a national Learning & Development team, and each region also has a Learning and Development team. The teams support staff learning including PSG issues.

19. In addition to Whitehall-wide assessments like Treasury's Financial Management Review and the Cabinet Office's Capability Review it is to be hoped that the DCA is continually monitoring it's own performance. How does it do this?

The Departmental Management Board and Ministerial Executive Board receive regular progress updates on DCA performance. This includes performance against PSA targets, Ministerial priorities where not otherwise covered by PSA targets, risk reporting, progress on major programmes and projects, and financial reporting. The boards use this information to continually monitor performance, constructively challenge any areas of under performance and take informed decisions on the adjustment of priorities as necessary. In addition we have set up a Departmental Management Board performance sub committee to undertake quarterly reviews of the performance of DCA, its agencies and NDPBs. The sub committee, comprising of the Permanent Secretary and Director Generals of Finance and Strategy, reports to the full Departmental Management Board. It met for the first time in July 2007.

Does the DCA benchmark any aspects of its performance against other organisations?

Due to the different and diverse nature of the work of individual government departments, it is not possible to benchmark DCA performance against its PSAs with any other organisations, as these targets are specific to our organisation.

The Department has done some benchmarking activity in relation to its corporate functions:

— Finance—benchmarking, against both other government departments and major suppliers, is currently being planned to inform the development of new service level agreements with the external service supplier.

— Procurement—we are currently assessing the scope of a benchmarking exercise and are aiming to include comparison with central government, local government and the private sector.

— IT—Best practice benchmarks have been used to inform decisions on the size and shape of the in-house team as part of the preparatory changes e-Delivery Group are making prior to the award of the DISC contract (the Development, Innovation and Support Contracts—DISC—programme is responsible for the replacement of the department's existing core IT currently separately providing corporate functions, business applications and IT infrastructure services to DCA). Options for the ongoing benchmarking of services once the contracts are in place are also now being examined.

However, there are a number of other methods by which DCA gauges how well it is performing in areas such as staff surveys. The department has also won the first justice award and public service award demonstrating the high quality of service we provide.

Examples include:

— Staff opinion survey results—we compare the results of a number of core questions in our staff opinion survey against other Whitehall departments. Our survey outcomes are above average for a mainstream delivery department.

— Carers UK in Employment Employer of the Year award—DCA was given this award in December 2004.

— Stonewall Equality Index—DCA was rated in the top three best government departments for lesbians, gay men and bisexuals to work for in the Stonewall Equality Index 2006.

— Work-Life Balance—in August 2006, the Wales and Cheshire Region of HM Courts Service successfully achieved accreditation against the Investors in People Work-Life Balance Model. We are the first organisation in Wales, public or private sector, and one of very few public sector organisations in the UK, to do so. This is a major achievement for those concerned given the tough assessment standards.

— Faith forum—in February 2006 DCA was the first government department to launch its Faith Forum providing a corporate staff network investigating issues within the work environment from religious perspectives.

— Xhibit—In December 2005, the DCA's new computer system, XHIBIT (eXchanging Hearing Information by Internet Technology), that gives court users instant access to trial records in criminal proceedings won two public services awards. It won the first prize in the Joined-Up Government category of the Guardian Public Services Awards as well as the year's overall winner in the Telecoms Innovation category at the 2005 Good Communication Awards. The Good Communications Awards recognise excellence in public sector communications, information sharing and joined-up government. Xhibit also won the first ever Justice Award in England and Wales in October 2004, for the team at Snaresbrook Crown Court.

20. The DAR (page 69) talks about the Department's diversity strategies but no figures are given to demonstrate current performance? Can the Department provide figures, in particular in relation to the Cabinet Office's diversity targets for the SCS (37% women, 4% ethnic minority and 3.2% disabled by April 2008)?

The DCA has set stretching targets for the proportion of women in the SCS because representation currently exceeds that for the Civil Service as a whole. A target has also been set specifically for the proportion of women at pay band 2+ and these figures are detailed below.

DCA Workforce Diversity Statistics—Performance Against SCS Cabinet Office Diversity Targets


		April 2008	April 2008
Senior Civil Service	February 2006	Civil Service Target	DCA Target

Proportion of women	36.50%	37.00%	45.00%
Proportion of women at pay band 2+	36.7%	30%	37.0%
Proportion of minority ethnic staff	4.50%	4.0%	4.0%
Proportion of staff with disabilities	1.90%	3.2%	3.2%

FINANCE

21. The Treasury's Financial Management Review highlights addressing the problems that arose from the implementation of the Department's new Oracle system. In order to address these, did the Department rely heavily on outside consultants?

What was the total cost of consultancy associated with the Oracle implementation and addressing subsequent problems?

As noted in the Treasury's Financial Management Review, the Department recognised that the issues arising from the implementation of Oracle 11i posed a significant number of risks to financial management within the Department. Consequently several measures were taken to resolve the issues.

The main action was the establishment of the Financial Systems Implementation (FSI) Programme. This was set up to:

— take short-term actions to stabilise the implementation, minimise incorrect transactions and correct errors within the financial system; and

— recover the system and processes to provide a robust business-as-usual service to the organisation.

The FSI Programme was successful. System and process were recovered to an acceptable business-as-usual performance so that reliance could be placed on the finance system. Staff, particularly end-users, from throughout the organisation were involved in the Programme, which also involved senior finance staff in the necessary governance arrangements.

As part of the Programme, there was the need for external consulting support, mainly to give quality assurance over the recovery process itself and to give advice where this was not held in-house. The total amount of external consultancy costs incurred by the FSI Programme was £1.1 million.

22. Both the Treasury's Financial Management Review and the recent Capability Review highlight the need to build capacity in the finance team. How much progress has the Department made in this? By when does it envisage it will have the required capacity?

The Department has made significant improvement in building the capacity in the finance team, and this work is ongoing. Specific actions are detailed below:

(a) The Finance Executive Group (FEG) has been established as a cross-departmental finance leaders forum. Meeting monthly, it provides strategic direction to the finance function across the DCA family and a corporate approach to dealing with issues.

(b) Under FEG ownership we have embarked upon a Finance Transformation Plan built around:

— planning and working together across the DCA Finance Family;

— providing financial and commercial leadership to DCA to support the Department in achieving its objectives;

— improving the tools of our trade;

— improving our skills and ways of working; supporting people in making the changes and working more effectively.

Key deliverables fall into five specific groupings: Focus on Delivery; Information Built for Action; Effective Governance; Enhanced Skills & Performance; Effective Communications.

(c) Through the Finance Transformation proposals considerable progress has been made in improving financial planning, focusing on efficiency and enhanced reporting. Other specific improvements include a skills audit to inform our future capability building and succession planning, and a bite size learning programme to help develop commercial awareness, managing change, and a range of other skills across the DCA Finance Family.

(d) Cultural change that will support a more efficient and effective finance team is being driven through the Finance Change Management Programme. Initial research has been completed and externally validated. This programme is now engaging with senior and middle-finance managers in how to embed the behaviours to do things better, work across functions, think commercially, build skills and experience, and become trusted advisors on the heartbeat of the business.

(e) DCA Corporate Finance has been restructured and recruitment completed for the revised skills sets. There is now a good blend of public and private sector skills and appointments to specific areas, such as financial planning and financial controller for corporate services, have bolstered the DG Finance's senior management team.

(f) There is a management refocus on developing and performance managing teams, as well as involvement in activities with the wider business to be more outward facing.

(g) The Departmental Accountancy Training Scheme is accredited by all the main CCAB bodies and recruited two graduate trainees and two Fast Streamers, with the aim to develop future leaders.

By when does it envisage it will have the required capacity?

The structure and foundations are in place now and have already improved and increased capacity. There is a lot of work in progress and the Change Management Programme measures will keep it on track. Whilst this is likely to take several years to become fully embedded, there will be incremental successes and in 12 months time we expect to demonstrate further improvements.

How does the Department balance the need to reduce its total headcount with the need to build capacity in finance and other key areas?

Our overall strategy is to have a smaller, more highly skilled workforce focussed on work that contributes most to the Department's priorities.

Specifically within the finance function, an exercise has been completed to redesign the roles and functions within the team. The main objective of this exercise was to reshape the finance division to meet future challenges, mainly by phasing out transactional work, focusing on value added activities and ensuring the team included the right skills. This allowed the function to start to provide the Department with a more professional finance support function whilst at the same time reduce its total headcount.

23. The Treasury's Financial Management Review says that in order to address the predicted shortfall in the legal aid budget in future years "strategic decisions on savings, efficiency, reforms, and what programmes can be delayed will need to be made if DCA are not to go through the next two years having to identify cuts in year". What programmes has the Department delayed to achieve this? When will these now take place?

Following an extensive Business Planning exercise, the Ministerial Executive Board took the decision in February 2006 to reduce budgets across all areas of DCA based upon the emerging efficiency plans from the Department's front-line service organisations as well as from corporate service areas. As a result, whilst no specific programmes were cancelled or delayed, the business was faced with very challenging financial targets, requiring rapid change to operating models. The Departmental Management Board continues to monitor the situation closely. In addition the department is developing its medium term financial and business planning systems. This will enable us to focus our future business strategies, in particular within HMCS, the Tribunals Service, and the Legal Services Commission, so as to deliver our core services at lower cost. These strategies will set out ways in which savings and efficiencies can be made in a way that enables business objectives to be delivered within reduced budgets.

Has the Department made an assessment of the upfront costs of implementing the recommendations in the Carter Report? Will any other projects need to be delayed to find this money?

An initial assessment of the sums involved in implementing the Carter Report has been made, but as yet is incomplete; while some relatively small costs have been identified for crime, the impact on civil has yet to be costed. Although we expect the total costs to be relatively small the Department continues to discuss with HM Treasury the possibility of additional funding to meet these costs.

All projects are continually reviewed and prioritised given the Department's funding envelope is fixed. However, we do not envisage that other projects will need to be delayed to find the money for implementing Carter.

24. Treasury guidance includes a new requirement for a narrative alongside core tables. It says: " . . . we believe that it would be helpful to readers of the 2006 Departmental Reports if departments could provide a narrative explanation of or commentary on the numbers in the core tables. Departments are asked, therefore, to provide alongside their tables an explanation of what the numbers represent and an explanation of what the numbers show." The Department has not included any such commentary. Can the Department do so, in particular explaining:

— 7% increase from the planned expenditure for 2005-06 (as given in the 2004-05 DAR) to the estimated outturn reported in the 2005-06 DAR.

— 64% increase for headquarters and associated offices in 2005-06 from plans given in last year's DAR. This may indicate problems with the Departments efficiency programme.

— 28% increase in administration expenditure in 2005-06 from plans given in last year's DAR. This raises further concerns about the Department's efficiency programme.

(a) Planned Expenditure—Total Resource Budget for 2005-06

£ million

As disclosed in 2004-05 DAR 3,594

Winter Supplementary Changes 66

Spring Supplementary Changes 22

Forecast Overspend 39

Tribunals Machinery of Government Transfer 143

As disclosed in 2005-06 DAR 3,864

In accordance with HMT Machinery of Government policy, the 2005-06 DAR includes previous years' outturn and budget information for the Tribunals which were transferring to DCA. Due to problems which HMT were encountering with their new Public Expenditure database, we were unable to show these additional figures as a separate subhead, as we would have wished, and therefore had to include them in the DCAHQ line.

Details of the Supplementary Estimate changes are listed below:

— In the Winter Supplementary Estimate, the DCA DEL increased by £66 million. The largest movements within this amount were:

+£71 million Elections Funding (funding for Returning Officers)

+£27 million Transfer from HO (CJIT funding for Crown Court infrastructure)

+£15 million Draw down of End Year Flexibility (EYF) for LIBRA

-£45 million HMCS Fine netting off scheme

— In the Spring Supplementary Estimate, the DCA DEL increased by £22 million. The largest movements within this amount were:

+ £41 milion Draw down of Asylum EYF (not used for Asylum with Treasury agreement)

+ £3 milllion MoG Transfer from HO and ODPM (Coroners and Elections policy)

+£3 million Transfer from DfES (Adoption & Children Act costs)

+£2 million Transfer from HO (CJIT funding for LIBRA)

-£11 million Transfer to NICS and Scottish Executive for Judicial Long Service Awards provision

-£6 million Magistrates fee income

-£4 million Transfer to NICS (NI Legal Service Commission costs)

-£3 million VAT clarification

[Since the DAR has been published the DCA provisional outturn for 2005-06, excluding incoming Tribunals, is estimated at £344 million under spend. This is largely due to additional provision write backs within the Community Legal Services.]

(b) Headquarters Expenditure 2005-06

£ million

As disclosed in 2004-05 DAR 503

Winter Supplementary Changes 117

Spring Supplementary Changes 135

Net Transfers following Spring Supplementary -14

Forecast Underspend -60

Tribunals Machinery of Government Transfer -143

As disclosed in 2005-06 DAR 824

In accordance with HMT Machinery of Government policy, the 2005-06 DAR includes outturn and budget information for the Tribunals which were transferring into DCA. The £824 million figure shown includes £143 million, which was not shown in the 2004-05 DAR plans for financial year 2005-06 (£503 million).

Details of the other changes are detailed below:

— In the Winter Supplementary Estimate, the DCAHQ increased by £117m. The largest movements within this amount were:

+£71 million Elections Funding

+£27 million Transfer from HO (CJIT funding)

+£15 million EYF (LIBRA)

+£47 million internal reallocations

-£45 million HMCS Fine netting off scheme

— In the Spring Supplementary Estimate, the DCAHQ increased by £135 million. The largest movements within this amount were:

+£100 million Judicial long service award provision

+£41 million Asylum EYF (not used for Asylum with HMT agreement)

+£3 million MoG Transfer from HO and ODPM (Coroners and Elections policy)

+£3 million Transfer from DfES (Adoption & Children Act costs)

+£2 million Transfer from HO (CJIT)

-£11 million Transfer to NICS and Scottish Executive for Judicial Long Service Awards provision

-£4 million Transfer to CPS (Charging initiative and Case progression tool)

— Between the Spring Supplementary Estimate and the DAR, there were the following virements in and out of DCAHQ:

+£6 million for Tribunals costs (from HMCS)

-£18 million to HMCS to cover CJIT asset depreciation costs

-£2 million to HMCS to cover Digital Audio Recording costs

(c) Increase in Administration expenditure (25%)

£ million

As disclosed in 2004-05 DAR 417

Winter Supplementary Changes 17

Spring Supplementary Changes 11

Tribunals Machinery of Govnerment Transfer 77

As disclosed in 2005-06 DAR 522

In accordance with HMT Machinery of Government policy, the 2005-06 DAR includes outturn and budget information for the transferring Tribunals. Therefore, the £522 million figure includes £77 million, which was not shown in the 2004-05 DAR plans for financial year 2005-06, (£417 million).

Details of the Supplementary Estimate changes are listed below:

— In the Winter Supplementary Estimate, the admin budget increased by £17 million. The largest movements within this amount were:

+£15 million EYF (LIBRA)

+£4 million Transfer from HO (CJIT Funding for ETMP)

— In the Spring Supplementary Estimate, the admin budget increased by £11 million. The largest movements within this amount were:

+£3 million Transfer from HO (CJIT)

+£3 million VAT clarification (agency staff)

+£2 million Transfer from ODPM (Elections MoG)

+£1 million Transfer from HO (Coroners MoG)

+£1 million Asylum EYF drawdown

+£1 million Transfer from DfES (Adoption & Children Act)

25. Why is the Department unable to provide budget figures for its capital employed in future years in the core tables in the DAR?

A forecast balance sheet was not available at the time of preparing the DAR due to material uncertainties with the opening position of the HMCS balance sheet. These uncertainties have partly been overcome following completion of the 2005-06 accounts.

  Attached below is the Department's capital employed analysis.

Outturn Estimated Outturn Projected

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08

£000's £000's £000's £000's £000's £000's £000's £000's

Fixed Assets 1,355,085 1,550,781 1,583,793 1,732,515 1,839,675 2,870,797 3,175,328 3,616,571

Of which:

  Land and buildings 1,293,567 1,471,725 1,517,064 1,604,260 1,659,716 2,675,054 2,973,854 3,412,604

  Plant and machinery 57,670 76,021 66,729 128,255 179,959 195,743 201,474 203,967

  Vehicles 3,848 3,035 - - - - - -

Current Assets 162,401 180,890 272,037 297,341 222,783 612,371 630,299 638,101

Creditors (<1 year) (156,993) (200,958) (285,826) (301,149) (318,999) (740,165) (761,834) (771,264)

Creditors (>1 year) (2,259) (1,190) (7) (427) (59,439) (177,465) (182,661) (184,922)

Provisions (387,491) (437,466) (514,430) (33,571) (25,494) (420,110) (407,409) (387,452)

Capital employed within main department 970,743 1,092,057 1,055,567 1,694,709 1,658,526 2,145,428 2,453,723 2,911,034

NDPB net assets 1,908 (6,239) (18,426) (8,881) (15,976) (5,512) (5,622) (5,735)

Legal Aid Fund net liabilities (1,982,546) (2,140,966) (2,246,030) (2,593,461) (2,120,282) (1,681,617) (1,304,309) (958,825)

Total capital employed in departmental group (1,009,895) (1,055.148) 1,208,889) (907,633) (477,732) 458,299 1,143,791 1,946,475

The major movements from 2004-05 reflect:

— Increase in fixed assets in 2005-06 to reflect the Property Transfer Scheme created by the Lord Chancellor upon the creation of HMCS. Following a High Court judgment, some properties did not transfer to HMCS when the new agency was created. These are likely to come under HMCS control over the next couple of years and this results in increasing fixed assets in 2006-07 and 2007-08.

— Increase in fixed assets to reflect investment in the courts estate (including additional spend on backlog maintenance).

— Inclusion of Magistrates Court fines from 2005-06 resulting in an increase of c.£350 million to both creditors and debtors.

— Inclusion of specific provisions upon the creation of HMCS, specifically in relation to the inherited Local Authority pension deficit of £268 million.

— Reduction in the level of outstanding work-in-progress within the Legal Service Commission (LSC) resulting in reduction in net liabilities of the legal aid fund.

26. The Department is one of only five main departments not to meet this year's pre-recess deadline for laying Resource Accounts. What were the main reasons for this?

What has the Department put in place to ensure that accounts can be laid pre-recess next year?

Following significant improvement in the accounts completion timetable in 2004-05, the issues arising from the Oracle implementation in 2005 has meant less time available to develop further the Faster Closing agenda.

The 2005-06 accounts production process has been a challenging one for the Department, due to these Oracle issues but also because 2005-06 has embodied the first year of the new HMCS agency. This has involved the bringing together of 43 separate organisations, 41 of which had no previously identified separable accounts. Despite this huge challenge, the agency accounts were completed, laid and published as planned before the Summer recess this year.

The consolidated resource accounts have been finalised subsequently and were presented to the Department's Audit Committee on 31 August 2006, as planned, for signing on 14 September (an 11 week improvement on 2004-05).

We are now looking ahead to 2006-07, and our aim is to achieve pre-Summer recess for the consolidated resource accounts. This remains a challenge, mainly due to the fact that 2006-07 sees the first year of another new agency in the DCA: The Tribunals Agency.

The Department continues to work closely with the NAO in relation to Faster Closing and both the NOA and HM Treasury are supportive of the current strategy in relation to delivery of the 2005-06 accounts and plans for the 2007-08 accounts. As noted in Q22 above, we are continually reviewing the skills and resources within the finance team and assessing these in light of the target for pre-Summer recess next year. Other action we are taking to meet this target include:

— continual improvement to in-year financial monitoring and control;

— preparation of interim consolidated accounts;

— close liaison with NAO on audit timetable; and

— building closer links with the Department's executive agencies.

27. In its Main Estimate Memorandum the Department says that it is unable to provide an apportionment of budget allocation by PSA but intends to do so for the Winter Supplementary Estimate Memorandum. What is provided in the Main Estimate Memorandum is a comprehensive list of the key actions for 2006-07 for each of the Departments key activities. How can the Department be sure that it will be able to resource all its intended key activities if it is unable to identify resource needs at this stage?

Is an apportionment of budget allocation by PSA available yet?

DCA will provide a breakdown of Total Net Resources by PSA in the Winter Supplementary Estimate Memorandum.

PSAs by their nature cannot cover the full range of the Departments activities and are focussed on key outcomes. Therefore, there are elements of the DCA budget which do not directly contribute to PSA delivery. We have identified the key activities associated with successfully delivering the PSAs and have ensured that these activities are allocated the necessary funding. In doing this we have ensured that our allocation process is linked to our intended delivery outcomes.

28. Can the Department update the Committee on its current stock of EYF including that from 2005-06, indicating what it is earmarked for and when it will be drawn down?

In particular when will the £1.91 million of underspend against the Single Asylum Fund in 2004-05 which was carried forward as EYF be drawn down to assist with the current backlog of asylum appeals cases?

The total stock of DCA EYF is £385m Resource and £89 million Capital. These can be summarised as follows:

Resource DEL:

£56 million Underspend from 2005-06. This is entirely non-cash

£286 million Provision write-back from 2004-05 provisional outturn on the CLS (legal aid). This reflects the crystallisation of old cases where confirmation has been received that no liabilities remain outstanding. This EYF is entirely non-cash.

£4 million Other adjustments to 2004-05 provisional outturn.

£35 million Ringfenced Elections EYF for use in 2006-07 to fund Electoral Administration Bill and e-voting pilots.

£4 million Carried forward from 2004-05 underspend which HMT deferred access to until 2006-07.

£385 million Total

Capital DEL:

£37 million Provisional under spend from 2005-06. This represents slippage on specific projects. Amounts will be drawn down in 2006-07 to meet requirements on these projects.

£5 million Adjustments to 2004-05 provisional outturn.

£2 million SAF carried forward from 2004-05 underspend.

£45 million From HMT to compensate for changes in balance Sheet treatment of several PFI courts. This will be drawn down in 2006-07 and 2007-08 as these PFI courts are completed.

£89 million Total

At present, there are no plans to draw down the £1.91 million Capital SAF underspend.

Efficiency

29. The DAR (pages 59 and 60) outlines the Department's improved risk management processes. Can the Department share the key findings of its risk assessment of its efficiency agenda with the Committee?

The key areas of risk are: (1) enabling projects such as LIBRA and HMCS Area Transformation, which are crucial to the delivery of both our headcount and financial targets; (2) ensuring that the data systems providing headcount data are robust and complete following the creation of the new Tribunals Service and other bodies in April 2006; (3) ensuring that service quality is not adversely affected by the efficiency agenda, by identifying the causes of fluctuations in performance as part of regular reviews of performance data, and; (4) embedding the cultural change that has begun as a result of the Gershon agenda. This is necessary to ensure that in the future efficiencies are continuously identified and driven out as a matter of core business. The main vehicle for keeping abreast of developments is the central efficiency risk register (fed by business area risk registers) which is formally updated quarterly. Where serious risks to the efficiency programme are identified these will be fed into the corporate risk register for the attention of the Departmental Management Board. The central efficiency team also hold regular reviews of our approach to risk management with the OGC risk management team, and are currently working with them to identify areas of best practice that could be adopted such as multi-tiered registers and issues logs.

In particular what are the main risks to the successful delivery of the savings in legal aid and how is the Department managing these risks?

The main risks are gaining effective control over (a) costs and (b) volumes. Regarding (a) costs, in the course of his review Lord Carter engaged in a positive dialogue with a wide range of representative groups to ensure that his recommendations address the major concerns of key stakeholders, including the professions. DCA will continue to maintain this constructive dialogue to ensure stakeholders are able to play their part in ensuring the legal aid scheme remains sustainable. Additionally, formal programme management arrangements, led by the Permanent Secretary, were set up in November 2005. The programme board meets regularly, with supporting structures monitoring and advising on risks and progress on savings. Regarding (b) volumes, the ultimate risk remains that legal aid is predominantly demand-led (volumes being driven by decisions taken outside of DCA/LSC). The introduction of the Legal Aid Impact Test (LAIT) reinforces the requirement that departments responsible for policy initiatives assess the financial implications of their policies on other departments, and agree on funding prior to implementation.

30. The NAO stated in its recent report on Whitehall's efficiency agenda that " . . . reported gains should be regarded as provisional and subject to further verification, given the degree of risk that efficiencies may not be measured accurately" and that "reported efficiency gains will only be fully credible if a department can clearly demonstrate that . . . data assurance is based on clear audit trails and independent validation". The Departments gains are only subject to interval validation at present, are there plans for any of the savings to be independently validated?

The Efficiency Team, with Internal Audit, have undertaken work to develop clearer lines of accountability and ownership of reported savings, and to gain better visibility of the systems and assumptions underpinning those savings. The second National Audit Office study of the government's wider efficiency programme featured three of DCA's efficiency workstreams (legal aid, cross-CJS performance improvement, and the Asylum and Immigration Tribunal), providing substantial independent scrutiny. The findings of this report will be published in an NAO value for money report in 2007. In addition, the Legal Services Commission Corporate Assurance Division are now tasked to validate and assure quarterly efficiency savings from legal aid.

31. The Efficiency Technical Note (ETN) lists eight initiatives in the legal aid workstream but there is no indication of how much each of these is planned to contribute to the total planned £198 million savings. Can the Department provide this breakdown and a similar breakdown for the £43.9 million saved so far (DAR page 56)?

The £43.9 million is broken down as follows (rounded to nearest £ million) and covers the period April to November 2005:

Capping civil legal help—tailored fixed fees and CLS Direct £14 million

Cracks & Guilties Scheme £2 million

Control of VHCCCs £22 million

CPS Charging initiative £2 million

Other changes to Crown Court remuneration £2 million

LSC Administration and other administrative changes £2 million

The £198 million planned savings breaks down as follows:

Control of VHCCCs £74 million

Capping civil legal help—tailored fixed fees and CLS Direct £33 million

Extending the fixed fee legal help scheme to cover the family legal help element of civil representation
£3 million

End £3k exemption on recovery for matrimonial cases £3 million

Cracks & Guilties Scheme £8 million

Transfer responsibility of grant from magistrates' courts to LSC and introduction of means testing
£35 million

CPS Charging Initiative £25 million

Compulsory Competitive Tendering** £17 million

**Savings from this initiative has now been subsumed in the Carter reforms

32. Shortly after the introduction of the new payment scheme for cracked trials and guilty pleas, in October 2005, the Department acknowledged that one of the aims of reform was to avoid the situation where a trial which "cracked" might attract a higher fee than had it progressed to trial. Are the October reforms working to avoid this result?

In general terms cases of a similar type and weight do not attract a higher fee when they "crack" than if they had gone to trial. However, cases that crack in the final and, to a lesser extent, second third of the current Graduated Fee Scheme (GFS) will usually, even after the October 2005 changes, still attract a higher fee than had it progressed to a one or, in some cases, two-day trial. It is to be remembered though that a case which "cracks" could have been estimated to last up to 40 days. It is therefore necessary to devise a scheme that covers cases which "crack" with a trial estimate of anything between 1 to 40 days and remunerating the advocate fairly for fully preparing a case for trial. Cases with a trial estimate of more than 40 days would be taken up under a Very High Cost Case Contract.

Prior to the October 2005 changes all "cracked trials" with over 250 pages of prosecution evidence were determined ex post facto (this is the assessment after the case had concluded where the claims are individually assessed and allowed on the basis of the individual number of hours involved and specific hourly rates for the various grades of fee earners). When bringing these cases within the GFS (which is a system of standard fees) it was agreed with the Bar Council that those "cracked trials" already in the GFS (with less than 250 pages) should remain on a cost neutral basis post October 2005. It has therefore proved difficult to model a comprehensive scheme that fairly remunerates an advocate who has fully prepared a case for trial, but which subsequently "cracks" (including where the prosecution offers no evidence), while ensuring that a "cracked trial" does not pay more than a one or possibly two-day trial in every case.

The Carter proposals will further reduce the number of occasions where a "cracked trial" would be paid more than a one-day trial, but will not be eradicated altogether.

The Bar Council expressed its concern about the operation of this scheme in September 2005. The Carter Report recommends that the scheme should be subject to review in January 2007 (Recommendation 4.12). If the review finds that the scheme should be scrapped what impact will this have on the efficiency agenda?

Prior to any review in January 2007 the Bar Council will have been consulted over the Carter Review in general and the consequential Funding Order amendments. It will not be a question of possibly scrapping the scheme but ensuring that the balance between "cracked trial" and "trial" fees are correct and making any changes considered necessary.

33. The Department has explained that it will work toward efficiency savings by replacing the current system of paying firms an hourly rate with competitive tendering and payment on a case by case basis. Lord Carter envisages a system of "best value" tendering being in place by 2009 for General Criminal Contracts. This approach will encompass quality, capacity and price. Can the Department provide the Committee with a detailed breakdown of how it believes competitive tendering will lead to efficiency savings, what steps they intend to take before 2007-08, and to have precise estimates for the saving those measures will make?

We have already moved away from paying by hourly rate in some areas of Legal Aid remuneration. The current Legal Aid procurement regime includes Graduated Fees for advocates in the Crown Court, and Standard Fees for litigators in magistrates' courts as well as Standard Fees for litigators in Crown Court cases that lasted for one or two days. These schemes remunerate representatives by output rather than input- ie practitioners are paid a fixed or standard fee to undertake a task (with the price graduated according to the complexity of the case, or time taken in magistrates' court cases), rather than a flat rate per hour of work required to undertake this task.

Lord Carter's Review set out how he expects that competitive tendering will incentivise efficiency, by providing greater rewards for more efficient firms, which the current system does not (Chapter 2 of the Review sets out the rationale for reform of the current regime, including the deficiencies of the hourly rate). We support the rationale in the Review that competitive tendering will reveal the market's "best price" for providing these services, and that payment by case will incentivise firms to prepare cases more efficiently by remunerating by task rather than by the hour. As Lord Carter made clear, both of these elements must be supported by a robust quality framework.

Pending the outcome of consultation, in 2007, we intend to introduce fixed prices and new working arrangements for police station work. In magistrates' courts, we intend to bundle a proportion of travel and waiting payments into current magistrates' court standard fees, ahead of the introduction of a graduated fee in 2008. On Crown Court fees, subject to the outcome of consultation with the professions we propose to introduce the new Graduated Fee for litigators and revisions to the Advocates Graduated Fee in April 2007. We will also make preparations to introduce the range of reforms to VHCC fee regime laid out in the Carter Review.

In the schemes involving moving from payment by hourly rates to fixed fees, Lord Carter envisaged savings of £10 million in Police stations, £10 million in the magistrates court, and £28 million for litigators in the Crown Court (including in Very High Cost Cases) (from p195-196 of the Carter Review). As the policy proposals contained in the Review are currently subject to a full public consultation, we are unable to provide precise further estimates for efficiency savings from this element of the Carter reforms. Following the conclusion of this consultation period, and the resulting completion of the design of schemes, we will compile fuller and more detailed estimates of the savings package from the Legal Aid procurement reform programme as a whole.

34. In his report, Lord Carter states that legal aid costs will continue to escalate unless his reforms are implemented. In the light of this statement how realistic is the estimated £198 million saving on legal aid outlined in the ETN which do not rely on Lord Carter's reforms?

Lord Carter's reforms have changed the timetable for some of the savings detailed above, which in the longer term will provide higher savings than originally anticipated. The central efficiency team is currently working with the LSC and OGC to understand and incorporate the effect on existing efficiency plans, but we still consider the original £198 million legal aid target to be realistic and achievable.

35. The aim across Whitehall is for half of all efficiency savings to be cashable and most departments are planning along these lines. Why is DCA only planning to make a fifth of its savings cashable? In particular why are all the savings due to be made in legal aid non-cashable?

When the financial savings targets were set for the SR 2004 period, HM Treasury decided that, although legal aid efficiency initiatives would save money they did not meet the strict definition of "cashable" savings under the Efficiency Review. This is because the money saved would reduce the shortfall on the legal aid budget rather than release cash that could be reinvested elsewhere. However, DCA's "cashable" savings target was set at a lower level than other departments' to reflect the fact that the substantial legal aid efficiencies did constitute reduced spend.

REGULATION

36. The NAO recently brought out a report "Evaluation of Regulatory Impact Assessments 2005-06" (HC 1305). Whilst DCA was not one of the departments studied the findings of the report may apply to some of its regulatory work. Has the Department considered the reports findings? Will it alter any of its own processes as a result?

DCA has carefully considered the NAO report and supports the majority of its recommendations. DCA is keen to ensure that the relevant recommendations are taken forward by the department. In order to ensure a coherent approach DCA will co-ordinate this work with the current consultation exercise being carried out by the Better Regulation Executive at the Cabinet Office. This may lead to wide-ranging changes to the present Regulatory Impact Assessment (RIA) process. DCA is contributing to the exercise being led by the Better Regulation Executive. Once the shape of the new RIA process is clearer DCA will develop its own plans to communicate the changes to all staff and to make sure that appropriate training sessions and information sources are available to all staff.

37. One of the main issues raised by the NAO report was a failure to evaluate the impact of regulation after it has been implemented. the DAR (page 60) highlights one example where a DCA RIA (for the Supporting Magistrates to Provide Justice programme) included an explicit requirement for review. Has this review now happened?

What were the results?

Since the "Supporting Magistrates to Provide Justice" White Paper was published in November 2005, progress in meeting the commitments made has been closely monitored, with quarterly reports being submitted to DCA's Ministers. Some of the projects are still at the development or consultation stage and it is therefore too early to assess the overall impact of the White Paper.

Are any reviews after implementation of other regulation planned?

We expect implementation reviews to become more common in future. Two recent examples are:

— DCA is consulting on rules for the new court of protection, which is being established under the Mental Capacity Act 2005. The partial RIA published as part of the consultation outlines how management information will be collected to monitor cases coming to the court and confirms that the rules will be reviewed and updated as necessary.

— DCA has recently published the draft Coroners Bill outlining the proposed reform of the coroner system. The final RIA has a post implementation review section and sets out specific timetables for two planned reviews.

38. The DAR (page 61) says "So far DCA has made only limited progress with annual rolling statements and hopes to make substantive progress on this during 2006." Has progress been made?

If not what is the current timetable for this?

We have made slow progress on the implementation of the annual statement and have not advanced as far as we would have wished. This is partly because other areas of the Government's Better Regulation Agenda and Better Regulation Action Plan have been given priority in the last year. Steps are now being taken to promote wider awareness, understanding and compliance with Common Commencement Dates (CCDs) throughout the department. The department is planning to produce revised guidance for policy officials on this area and is aiming to have the first statement in place early in 2007.

September 2006

Trajectory for improvement against findings of Capability Review, March 2006

Develop the senior leadership team, engaged with staff at all levels
Success looks like: A top team consistently providing strong leadership, setting a clear direction and role modelling a corporate commitment to change and delivery Leadership continues to focus on developing as a team, demonstrating a strong commitment to shared values and behaviours and supporting each other in pursuit of shared objectives Staff are consistently connected to, and energised by the Top Team
In 6 months: The department's management board will have focused on their development as a team and made significant steps towards implementing a personal development plan. Action: — Programme for board development in place and underway — Board agreed statement of behavioural expectations — Board developed and implemented programme of regular engagement with staff at all levels (eg Board and Director meetings; staff forums; SCS conferences) Impact: — Staff understand the DCA vision and priorities — Assessed by staff survey data on: - Confidence with senior managers - Being kept informed - Understanding how work contributes to DCA objectives — On-line staff panel data and SCS engagement tracking	In 12 months: The board will have focused on communicating with staff at all levels and their profile will be higher. The vision and priorities will be embedded. Action: — Continued regular board engagement with staff — DMB team development awaydays — Self-assessment against capability review criteria, validated by PMDU Impact: — Staff engaged and committed to DCA vision and priorities — Board embedded statement of behavioural expectations. — Assessed by: - Staff survey data - On-line staff panel data - SCS engagement tracking - Positive engagement and feedback from staff events - 360° and NED feedback on the board	In 24 months: Through ongoing regular engagement staff will be energised by and confident in the Top Team, The SCS will be aligned and committed and playing an active role in the pursuit of shared objectives. Action: — DMB team development awaydays — Engagement with staff a regular part of DMB calendar — Further action identified as part of 12 month self-assessment — Re-assessment against capability review criteria validated by PMDU Impact: — DCA vision and priorities consistently embedded and staff advocates of delivering it — Board embedded statement of behavioural expectations — Assessed by: - Staff survey data - On-line staff panel data - SCS engagement tracking - 360° and NED feedback on the board

Further develop capacity to manage change and reform on a large scale and at pace

Success looks like:
Programmes are prioritised clearly and run collectively in ways visible to staff, particularly where resources are constrained and challenges high
There is a balanced approach between devolved and organisational change management
DMB has a strong people focus and enforces standards of behaviour and a new culture
Leaders show they understand and act upon what motivates front line staff to deliver results

In 6 months:

There will be improved understanding of the cumulative impact of change initiatives on the organisation and programmes will be clearly prioritised.

Action:
—  Change Director and Change Programme governance in place
—  Change Programme has clear actions and plans on behaviours and culture
—  Change portfolio developed
—  Initial stages of workforce change being implemented

Impact:
—  Staff understand the DCA vision and priorities
—  DMB take collective decisions supporting delivery of departmental priorities.
—  Assessed by:
    -  staff survey data
    -  On-line staff panel data
    -  SCS engagement tracking
In 12 months:

The board will have demonstrated it is the collective owner of change and have an understanding of people and cultural issues during periods of continuous change.

Action:
—  Progress in delivering change forms key element of SR07 case
—  Change delivery moving from economy to efficiency
—  Self-assessment against capability review criteria, validated by PMDU

Impact:
—  Staff engaged and committed to DCA vision and priorities
—  Assessed by:
    -  Staff survey data
    -  On-line staff panel data
    -  SCS engagement tracking
    -  Stakeholder views
    -  Change delivery implementing strategic reduction in cost base
    -  360° and NED feedback on the board In 24 months:

There will be a balanced approach between the devolved and organisational change management and a strong people focus at DMB.

Action:
—  Change portfolio refreshed post SR07 settlement
—  Resources released for reinvestment
—  Review and test change model still fit for purpose
—  Further action identified as part of 12 month self-assessment
—  Re-assessment against capability review criteria validated by PMDU

Impact:
—  DCA vision and priorities consistently embedded and staff advocates of delivering it
—  Assessed by:
    -  Staff survey data
    -  On-line staff panel data
    -  SCS engagement tracking
    -  Stakeholder views
—  Improved capacity to deliver change

Ensure clear, collective understanding of the business model to enable agencies and NDPBs to operate within a tight corporate framework

Success looks like:
A consistent shared understanding of the business model is embedded for DCA as whole
There is a clear understanding of the balance between devolution and centralisation
Governance arrangements for shared/support services unambiguously understood
There is a strong relationship between the LSC and DCA and clarity of accountability and behaviour

In 6 months:

The department will have a consistent shared understanding of the business model and a clear understanding of balance between devolution and centralisation. There will be a new system for appointing NEDs.

Action:
—  Board agreement to business model and model presented to SCS
—  Recommendations implemented from LSC governance review and healthchecks on key LSC programmes
—  RACI[3] analysis of key processes
—  System for appointing and effectively inducting new NEDs in accordance with Cabinet Office guidance
—  Refreshed and agreed governance arrangements for shared/support services in place
—  Explanation of business model in SCS induction and individual personal objectives on corporate contribution agreed for DMB members

Impact:
—  Business model confirmed and shared with all senior staff
—  Assessed by:
    -  Feedback from SCS conference
    -  SCS engagement tracking
In 12 months:

The board will have regularly engaged with NEDs and have open debates with LSC on objectives and responsibilities.

Action:
—  New NEDs appointed and regularly and effectively engaged with DMB and the department
—  Board to board meetings with LSC taking place
—  Governance arrangements adjusted as necessary as result of RACI analysis
—  Individual personal objectives on corporate contribution agreed for SCS
—  Self-assessment against capability review criteria, validated by PMDU

Impact:
—  Senior managers can articulate business model and their role within it
—  NEDs adding value in key areas of finance, people and change management
—  Shared view of DCA/LSC relationship and both board members have improved understanding of issues in both organisations
—  Assessed by:
    -  Feedback from 2nd SCS conference
    -  SCS engagement tracking
    -  360° and NED feedback on the board
    -  Staff survey
    -  Positive feedback from DCA/LSC board to board meetings
    -  Positive engagement and feedback from staff events In 24 months:

There will be a strong relationship between DCA and LSC and the relationship between centre of DCA and the rest of the family will be explicitly understood.

Action:
—  Review business model is still fit for purpose
—  Further action identified as part of 12 month self-assessment
—  Re-assessment against capability review criteria validated by PMDU

Impact:
—  Business model is embedded in the organisation
—  NEDs continue to add value to board and department
—  Assessed by:
    -  Feedback from 2nd SCS staff conference
    -  SCS engagement tracking
    -  360° and NED feedback on the board
    -  Staff survey
    -  Positive feedback from DCA/LSC board to board meetings
    -  Positive engagement and feedback from staff events

Develop delivery capability to deliver more with less resource

Success looks like:
Routing emphasis on performance management and planning
Board consistently clear about scale of challenges and the consequences, and engage with staff, Ministers and stakeholders
Continuing relentless focus on delivery, performance and prioritisation and staff engaged about delivery challenges

In 6 months:

The department's management board will have focused on their role in performance management, identifying areas of concern and achievements.

Action:
—  Board taking collective responsibility for performance management by recognising achievements and driving improvements
—  New Performance sub-committee meetings held

Impact:
—  Board collectively testing and challenging performance management data
—  Assessed by staff survey data on:
    -  Confidence with senior managers
    -  Being kept informed
    -  Understanding how work contributes to DCA objectives
—  On-line staff panel data and SCS engagement tracking
In 12 months:

There will be greater focus on delivery performance and prioritisation and the board will be tackling and challenging improvements.

Action:
—  Prioritised business plan agreed and communicated
—  Development of SR07 targets supported by understanding of how they are delivered
—  Evaluation of 2007-08 planning process
—  Revised performance measures understood
—  Self-assessment against capability review criteria, validated by PMDU

Impact:
—  DMB and staff see performance measures and process adding value to delivering performance
—  Assessed by:
    -  Evaluation of 2007-08 planning process
    -  Feedback from staff generating and using performance data
    -  Staff survey data; staff panel data; and SCS engagement tracking In 24 months:

There will be a sharper, analytical capability with the board consistently and corporately clear on scale of challenges.

Action:
—  Improved analytical support for planning/ performance management teams in place
—  Produced 2007-10 strategic business plan
—  Improved targets in place from SR07 process
—  Further action identified as part of 12 month self-assessment
—  Re-assessment against capability review criteria validated by PMDU

Impact:
—  Staff clearly see link between priorities, plans and SR07 targets
—  Assessed by:
    -  Feedback from staff generating and using performance data
    -  Staff survey data; staff panel data; and SCS engagement tracking

2 Recorded crime-Police recorded crime covers those crimes which are recorded by the police and which are notified to the Home Office. All indictable and triable-either-way offences are included together with certain closely associated summary offences. Back

3 RACI (Responsibility, Accountability, Consult, Inform) Back



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