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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 1569-i House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE ENVIRONMENT, FOOD AND RURAL AFFAIRS COMMITTEE
THE Departmental Annual Report 2006
WEDNESDAY 19 July 2006 MS HELEN GHOSH and MR IAN GRATTIDGE Evidence heard in Public Questions 1 - 96
USE OF THE TRANSCRIPT
Oral Evidence Taken before the Environment, Food and Rural Affairs Committee on Wednesday 19 July 2006 Members present Mr Michael Jack, in the Chair Mr David Drew Patrick Hall Lynne Jones David Lepper Mrs Madeleine Moon Sir Peter Soulsby Mr Shailesh Vara Mr Roger Williams ________________ Memorandum submitted by Defra
Examination of Witnesses
Witnesses: Ms Helen Ghosh, Permanent Secretary, and Mr Ian Grattidge, Director Finance, Planning and Resources, Defra, gave evidence. Q1 Chairman: We reach the final evidence session that the Committee will be having before the summer recess, and to that end we are delighted that Helen Ghosh, the Permanent Secretary of Defra, and Mr Ian Grattidge, the Director Finance, Planning and Resources, have been able to come and join us for our annual inquiry into the Departmental Annual Report. You are both very welcome. I hope, Helen, you are feeling nicely at home now in your new department, and fully up to speed on all aspects of it. I just saw your Secretary of State down the corridor. I think you have been giving each other mutual pep talks about your respective appearances in front of the Committee, is that right? Ms Ghosh: I do not think David Miliband needs a pep talk from me! Q2 Chairman: The Annual Report, as always, is a meaty read, and I must say the photographs were very pretty in it, but I do have to start with a very fundamental question. What do you think the purpose of this vast document is? Ms Ghosh: I think the purpose of this vast document, and I should say here that in the light of comments made from the Committee in the past it is considerably less weighty than it has been in previous years, its principal purpose, is to communicate to yourselves and Parliament the use that Defra has been making of the money that Parliament has voted to us, and also I think increasingly, given the more accessible style that we have adopted, it is communicating with - perhaps one would not say the general public but the people in the wider community who are interested in seeing what we do. Q3 Chairman: Does anybody read it once it has been compiled from beginning to end? Ms Ghosh: I certainly read it once it has been compiled from beginning to end --- Q4 Chairman: But nobody, shall we say, who is not a participant, who might be a member of the public, an interested observer? You do not give it to a few audiences to test out its coherence, its logic, its flow, its objectivity, before you finally unleash it on the normal public who read these things? Ms Ghosh: No, but it goes through that kind of process in our Communications Directorate for the normal kind of quality assurance on clear English and clear communication, but I think we have to accept it is for more specialist audiences than for the wider scale communication with the public, which I think we very successfully distribute on particular elements of our agenda. Q5 Chairman: You see, I found it this year lacking in the sense of narrative and clarity that last year's had. I was quite looking forward to reading the story but this time it was disjointed, and I give you an example of the kind of problem that I encountered. Chapter 3 is one of the longest chapters in the whole report, and read for example, "Establishing a business-led Sustainable Procurement Task Force to develop an action plan on sustainable procurement, see Chapter 2". So I turn back to chapter 2 and I hunt through to find the reference, because there is no reference, it just says, "see Chapter 2" - well, Chapter 2 has a bit of length, and eventually I found on page 21 the reference to this Sustainable Procurement Task Force, so I read, thinking this is going to educate me, and it says: "More information on Defra's work on sustainable consumption production is in Chapter 3"! So I am going backwards and forwards between the chapters, and I could do the same exercise for quite a few others, particularly when they refer to the PSA targets, and that is why I ask the question as to whether anybody had gone through to see if it had the right degree of coherence. You were talking about it communicating but one of the things I was surprised that it does not have at the beginning is, if you like, the sort of key things that we have achieved since last year, our key performance data, our key financial information - in other words, almost an executive summary style at the beginning, with a lot of the policy stuff at the back if you want to go into more detail. It seems to try to combine the two as you weave in and out of it. Why is there not that degree of clarity? Ms Ghosh: I think we can certainly take on board a recommendation for an executive summary. If I can just pick up your earlier point, I suspect there is not a perfect answer to how we describe what we have done in a department where everything is so closely interlinked. In fact what we did, and perhaps we did it excessively when we were doing an editorial process on this, was to try and excise what looked like repetition, so if, for example, you have a discussion of an over-arching organisational principle, like sustainable development, you will find it as a theme picked up across a description of most of our activities. We found when we looked at a first draft that, to take your Neville Simms task force example, we were describing the work of the task force under sustainable development in an over-arching sense, and then we were talking about it under sustainable production and consumption and discussing it again, so perhaps too crudely we decided we would only mention things once and that was one of the explanations of why we made it shorter. Perhaps we need to think again about how we do the sign-posting and that may be one place where we were too ruthless in our excision and things dropped between the cracks. The other thing I would say, and you were referring to pictures of livestock rather than pictures of Ministers in the top team when you talked about the "nice pictures", is that clearly we produced this on the cusp of a ministerial reshuffle, and as you will be aware, from talking to David Miliband last week, we are also in the process of a strategy refresh, so I think there was some element in which clearly we were, and are still, operating under our five strategic priorities, but feeling confident about the story we were telling about outcomes perhaps was a bit of a victim of the fact we were in the middle of a transition when we wrote this. So we are happy to do an executive summary; I think by next year's Report we will have carried through the strategy refresh and will be able to describe I think much more clearly a set of outcomes we are trying to achieve --- Q6 Chairman: I personally would far rather you settled down with some of the best practice company reports, because some companies are as complex as Defra is a complicated department and they manage to summarise for the shareholder, who is the member of the public you refer to, the key performance indicators and information about what they are doing, and what they do not do is try and cover every single aspect of their company's work. If necessary, for example, corporate social responsibility is now often a separate document, and it gives a degree of clarity without losing substance. Just to give you one other example, on page 123, and perhaps you would like to turn to it, figure 17, could you tell me what happened between 1990 and 1995, because it is an intriguing graph that suddenly starts from a moment in time in 1995 without any explanation as to what happened for the previous five years. Ms Ghosh: I am sure there must be some very good statistical explanation for that, and I will discover it and send you the answer. Chairman: That is the point I am getting it, whether anybody looked at this, because somebody who did not have their nose so pressed to the glass might have said: "What does this say?" And it is the kind of thing that you might want to reconsider. Q7 Mr Drew: This is something I remember from the late lamented days of the Department of Environment, Transport and the Regions, but of the things that it did when it looked at the transport strategy is it produced the parent report and then a series of children reports according to the different categories of transport. I am just wondering who reads this? I used to struggle through it and I have picked bits and pieces out of this and I just wonder if you should be looking at the different elements and produce papers to those elements. You have got the strategy document which, hopefully, will be short and will try and pull together the different parts, but just to give you one bit where I struggled with this, on page 112 at the top, and I know this is a complicated area but it says, "The Leader Plus Programme, currently a separate programme under structural funds, will not run as a separate programme under the 2007-2013 programming period. However, the Leader Plus Approach involving locally driven public private partnerships will be a key delivery mechanism for the next rural development programme. At least 5 per cent of the European funding must be delivered to the Leader Plus Approach in the next programme". I do not quite understand that, and I am a simple person, but to me that is the sort of thing which someone who is in the minutiae of this would need to know, but I am not sure in terms of an Annual Report, or even a child of an Annual Report, whether that is at all helpful in giving an overview of what it is Defra is doing in its Annual Report. Ms Ghosh: Yes. Making a specific and then a general comment on that, indeed, I recently had discussions with some of my team about what the Leader Plus Approach means, and I worked on a similar thing called the Urban Programme in east London under structural funds, but it essentially means a community-based approach, ie, a pot of money where the community, and you assemble a partnership to this end, decides on the spend. I do think there is a general issue about Defra, which certainly has struck David Miliband and to some extent it has struck me, which is, question mark, is this something to do with being so focused on Europe? We tend to describe things in terms of a process rather than an outcome, and my senior team and I have discussed this and I think this is something the strategy refresh gives us an opportunity to move forward on. When one asks for briefing very often one is given a long description of the process and where we are in the EU negotiations, without a very clear idea of what it is that Defra as a department of UK Government is seeking to achieve. I think we will be much more focused on that kind of outcome and less focused on process and I hope we will see that reflected. The idea of parent and daughter reports is a good one; I think we need to check whether it fits into the kind of guidance and rules we have from the Treasury, because there are some rules about what we have to put in simply to report to Parliament, but we will do our best. Q8 Chairman: Also, in terms of a bit of context, under that graph that I just commented on is another one of our hackneyed expressions about how much this Common Agricultural Policy is costing consumers and taxpayers, bearing in mind the budget covers many and various programmes, some of which buy, for the public, goods which they want, do you not think it is about time that there was a bit of context and a bit of breakdown as to what is being bought by the Common Agricultural Policy so that your interested member of the public might know what the expenditure is? Also, it is almost put as if it is a guilt number, "This is costing you this huge amount", whereas if you were to do the same with almost any other aspect of government expenditure, you could come up with an equally large number for this mythical family of four. Do you not think it is about time we tried to talk about what you bought for this expenditure, and not make people feel guilty as if every time they buy a piece of food they are paying for the Common Agricultural Policy? Ms Ghosh: Indeed, and I think David Miliband, both in his speech at Stoneleigh and I think when he talked to you last week, made clear that there are a great many public goods we are buying through the Common Agricultural Policy, and we will be buying more and more of them as decoupling goes further. Clearly we are buying good land management of 80 per cent of our land and, for example, even within Pillar 1 the cross-compliance activity associated with a new single payment has bought lots of good things. It has bought, for example, and is increasingly buying more hedges, more farmland birds to go back to interconnectedness, and as we transfer more money into Pillar 2 we will be buying more and more of those public goods. We are also buying, in some cases, fewer food miles, food produced in this country rather than food imported from abroad so you are quite right, we could explain it much more positively. Q9 Chairman: Right, but if you come to the key performance indicators, or the achievements of your department, that is the kind of thing that ought to be being broken out, because the interested person outside is also a taxpayer and they might like to know some of that but you could not derive it in such clear terms as you have enunciated to this Committee from reading this Report. Ms Ghosh: Which brings me on to a theme we might want to pursue later whether the set of PSAs we have under the 2004 settlement are good measures of our outcomes, and I think there are a number of areas we may want to explore, for example, the rural communities. Farmland birds in itself is a slightly peculiar measure. We have a slightly strange set of PSAs. We are thinking at the moment about an appropriate framework for CSR07 where we want undoubtedly to focus more on outcomes and think more effectively about how we engage broader government in our objectives and work coherently to UK Government objectives across the whole piece, and that may be something the Committee is interested in exploring with us as we take that work forward. Q10 Chairman: I am sure we will. Do you get any kind of reader feedback about this report? Ms Ghosh: I am not aware we do but I will ask our Communications Directorate and let you know. Q11 Chairman: That might be quite helpful. We talked last year about the way in which Defra interacted with other government departments and we were talking about the degree of clout which Defra had across government. In the time you have been in charge do you think, particularly in a very important field like climate change where the impression often is given that lots of other players are out there in the Whitehall field and, yes, there is a Cabinet sub-committee that deals with this but we cannot really order people around, and yet you are the Department that is really in charge, the clout factor in Defra has improved in the last twelve months? Ms Ghosh: Markedly, I would say. Q12 Chairman: For example? Ms Ghosh: In narrative terms from the time of my arrival. For example, the success of our then Secretary of State Margaret Beckett at the Montreal talks on climate change was a sign of very effective joined-up working across government, particularly obviously in that instance with our colleagues at Foreign Office and DfID, and I think the irons she pulled out of the fire were unexpected in terms of engagement of the United States and the dialogues that will now be continuing and which David Miliband will be picking up in the autumn as a result. I think the publication of the Climate Change Programme Review, although it still fell short of what we are hoping to achieve by 2010 in terms of climate change, was a good example of cross-departmental working but I think the most powerful examples are probably the two recent ones, the outcome of the EU ETS consultation, where we worked very effectively both at political and departmental level with other departments to produce a CAP figure very much at the top end of the range on which we had been consulting and some very useful mechanisms in order to support that approach. Also in the Energy Review, which turned out to be an extremely well-balanced package between the supply side and the demand side, in terms of energy efficiency and innovation and more imaginative approaches to energy generation, particularly disperse generation and renewables, than we might have expected, all built, I must say, on an excellent evidence and skills base within the Department and good networking and influencing skills across the piece. So I would say influencing evidence and skills and what we are managing to achieve is very much on an upward path. Q13 Chairman: But where could you do better? Ms Ghosh: Just about climate change or more generally? Q14 Chairman: In general? Or should I say where do you want to do more? Ms Ghosh: I think, and this is no secret, there are some very tricky issues for us as a department around land as an issue, and not just the planning system and the review that Kate Baker is doing, where I think we want to be probably even clearer than we are now as a department about what the endgame and the outcomes we want are. As an offshoot of that I think the big challenge to us is the increase in house building in the south and south east, where we need to make sure we are absolutely at the top of our game in terms of the evidence and arguments we can produce on building regulations, carbon footprinting, water regulations and all those sorts of things, and I think - and again, this picks up very much the PSA about the rural economy - we need to be even more engaged in the local government agenda. I think we need to see a greater knitting together of policies that are being developed in DCLG around city regions and local area agreements and a related issue for economic development with RDA, so I would like to put a lot of effort into our relationships with local government, RDAs and with DCLG around those sorts of use of land and how we make use of it and rural services and economy issues. Q15 David Lepper: On PSA targets and target 1, promoting sustainable development, you told us last year when we were looking at the Annual Report that you had great hopes of the sustainable development action plans that each department was to produce, being a very useful tool, I think you called it a "key" tool, in enabling your Department to ensure that everybody was taking sustainability seriously across Whitehall. So far as I can understand it, departments have submitted their action plans and there is going to be a report on them from the Sustainable Development Commission later in the year. Can you tell us first when that report is likely to appear? Ms Ghosh: I will have to get back to you on that. Officially they only started their new phase of work in April and in terms of their work plan and how they are going to report I think we are still unclear about precise dates. To go back to the substantive point, as you would expect there is a variety of success across departments, but the co-ordinating mechanism that we have in tracking progress is called the Sustainable Development Programme Board, which I chair with senior representatives from all departments and on which Jonathan Porritt from the SDC also sits. The kind of approach we are taking is, because one wants to focus on some absolutely key outcomes, to look at the litmus test policies that would be picked up individually by individual departments and we see whether they are green, amber or red and track the progress of those. Jonathan is very supportive of that kind of approach so I think what you will probably see in the SDC report is that kind of rag status report. But, as I say, in the programme board we are trying to focus on the key policies that we would regard as the test of sustainable development across government, whether that is climate change, the sustainable buildings code, the kind of work that DfID is doing on international sustainable development or community action. We also in that group track the specific sustainable development activities; we have discussed obviously the sustainable procurement task force and will be working through the Government response on that, and also the sustainable operations activities on which the Prime Minister made an announcement in mid June. We will be the supervisory body to that. Q16 David Lepper: You have said that some departments have produced, perhaps, a better stab at this than others? Ms Ghosh: I am not going to be drawn --- Q17 David Lepper: Well, perhaps not until the Sustainable Development Commission publishes its report, but can I just get the processes clear in my mind here because, looking at that section on pages 22 and 23 or so of the report, I was not too clear. Here is the Sustainable Development Commission, and then there is also the Sustainable Development Programme Board --- Ms Ghosh: Which is the internal government programme board. Q18 David Lepper: --- and that programme board has already, as well as the Commission, been looking at the sustainable development action plans? Ms Ghosh: No. The SDC has been tasked to be the external watchdog and judge of what departments do, so we explicitly ask the SDC as newly constituted and funded to be the arbiter and critic and supporter of what the Department is doing, so they will produce a report on how we are doing in order to spur us on to do even better. What we internally do as a within-government programme board is pick out a basket of things we think are the key tests of whether the UK is delivering a sustainable development strategy across a range of departments - DfES on its schools building programmes, sustainability of the Olympics, road-pricing, Energy Review, all those sorts of things, and we keep a track of how do we think we are doing on those. Q19 Chairman: Where is that in the working report? Ms Ghosh: This is a working document which will ultimately be reflected in the SDC's report, assuming they agree with our board judgments about things - but we could do, with the agreement of other government departments, something more over-arching. Q20 David Lepper: It is envisaged that the SDC report when it is published - and it may be a glowing report about every department, it may not be - will spur people on to do better where necessary, but does it have teeth of any kind? Is it exhortation or what? Ms Ghosh: Well, it is set up with a very powerful group of people on it and Jonathan Porritt obviously is someone who rightly has a very high profile. It also is an organisation that has very high access in terms of access to Ministers at the very highest level, including the Prime Minister and the Chancellor. If I take the examples of sustainable procurement and sustainable operations element, which obviously the SDC is absolutely behind, Gus O'Donnell has agreed with the Prime Minister that he would be responsible for driving these changes out through Government, so I think it has both teeth and a very high level of influence. Q21 Mrs Moon: To test how other departments were tackling things I submitted a series of Parliamentary Questions to all the departments asking them what they were doing about their responsibilities, in particular relating to halting biodiversity loss, and it is very interesting to see the response that came back. Taking you to page 82 in the Report, which also deals with PSA target 1, one of the things that is there is biodiversity and it does not look too good in terms of meeting our 2010 target, where we are saying that over half were assessed as making positive progress to achieving the objectives. The others all showed either no change or an uncertain trend due to lack of long-term data or short-term fluctuations in data. I know we have the 19 indicators but there seems to be a lack of targets and specific outcomes and a lack of focus of attention on sites and habitats and species. Just how are you going to know that you are making the progress to halting biodiversity loss by 2010 with this mixed picture, and how are you going to focus spending on research and monitoring, and what efforts are you making to ensure you have the money for that research to take place so we know whether we are going to be halting biodiversity loss? At the moment it is a very murky picture and seems to be a bit of a hotch-potch. Ms Ghosh: There are lots of very interesting issues in there. You are right, in some senses the data we have does not necessarily tell the full picture. Again, we happen to have this PSA that is about farmland birds, we are doing well on it, we hope, with our fingers crossed, but it is a proxy for a great many other things in the eco system. We have the kind of information we got recently from the Countryside Agency about the state of the nation which gave us very positive stuff, for example, about hedgerows and hedgerow replacement which, again, is another part of the eco system. But when I talk to people like the Wildlife Trusts they say what we do not have enough is an end-to-end view of eco systems and the related biodiversity issues. We do not, in a sense, have a Domesday Book of how we are in biodiversity terms across the whole of the country. Now, clearly, a Domesday Book would be very expensive and there is lots of great local information around from people like RSPB and other local wildlife trusts, but we do need to think of a way of measuring outcomes better. One of the things that Barry Gardiner was talking about at an event last night that we are extremely interested in and have already started work on in the Department is to try and develop the idea of an eco systems approach, how much do we know, building on work that the World Bank has done, and I think you were discussing briefly with David last week this idea that we need to know the value of biodiversity, partly so we can argue more strongly for biodiversity and partly so we know what are the elements of the natural world that we really need to protect beyond all others and, again, David I think used the example of the Grand Banks and cod. Something I am very interested in, only because it was the first thing somebody explained to me as part of the eco system, is the role of the bee and the bees are not doing very well at the moment but they have a value because, if they were not in the system with the variety of kinds of bees we have, pollination would not happen and there would be a real economic cost, so we are trying to work on that. As I say, we have done some work, Barry has commissioned more, and you will be hearing, I am sure, more about that. We also need to think about the absolute value of biodiversity, ie not just outcome-based but have a real debate with key stakeholders and the public about the absolute value of diversity in itself, and I do not think we have really got a clear idea when we are engaging in debates with other government departments about why it is we value things. There were some interesting comments Ben Bradshaw made in the Whaling Commission about why we are so concerned about the whale, for example, and that is a mix of reasons, as we know, but as a Department we need to be clearer about why we are concerned about biodiversity in itself. The evidence and innovation strategy which we are developing is one way of trying to put more research money into areas where we do not know the answers, frankly, and switch away, although I know this has been controversial, from the more mature areas of research. As part of a strategy refresh David Miliband has commissioned us, indeed, to do more work on the eco systems approach but also to think about how we need to shape our evidence base to ensure that we can put our best foot forward in terms of interdepartmental debate about it. There is, indeed, a lot to be done and we need to start thinking about it, and are starting to think about it in a slightly different way. Q22 Mrs Moon: Very quickly, one of the things that worries me is a lot of this research is done by NGOs who are often operating on shoestring budgets, and we can very quickly, if we do not keep an eye on those budgets and their funding, lose very skilled people and very able people, and agencies that are doing critical research can be lost. Are you keeping an eye to make sure that there is sustainability also in those NGOs and in their budgets so that when the funding agencies are undergoing change, or are perhaps casting their eye on internal re-organisation or structuring, there is not an impact on the vulnerable research bodies that are doing the critical work? Are you keeping your eye on that? Can we have your assurance that we are not going to lose that research and that monitoring because of things happening in Defra or Defra agencies? Ms Ghosh: Obviously what we try to do within the constraints of public spending is to give people as much certainty as we possibly can and that is why the evidence and innovation strategy that we will be publishing shortly is trying to give a long-term direction, both to the big research institutes where there will be some impact in terms of moving away from some of the more mature areas, as well as with the NGOs. The idea is that we give a longer term commitment to particular strains of research so there is more certainty and NGOs and the big research institutes can plan. At the top end, at the large scale end, for example, we are driving through the laboratory strategy, which is trying to put our big research laboratories like the Central Science Laboratory, CEFAS, and in the second phase PLA and the Institute of Animal Health on a sustainable footing so that for the very reasons you describe they are more immune to changes in funding from us than they would otherwise be, but it is an extremely important area. Q23 Chairman: One of the things that strikes me is there is a real need, and it does not come through in the Report, to produce something that tries to bring together all of the different elements of sustainability. Can you help me to understand where, in the picture you have been painting, the body which you have set up which produced a report, the Statutory Sustainable Development Duties Report, fits in? Ms Ghosh: Could you refer me to the page on that? Q24 Chairman: It is from your website. In fact, I think it may have come from the Sustainable Development Commission website, if the truth be told, but it does refer to your department and in the context of sustainability, and I quote from the document, it says: "To inform these considerations the in-house policy consultancy was commissioned by the Sustainable Development Unit, SDU, at Defra and the Sustainable Development Commission to investigate the impact of statutory sustainable development duties on bodies with existing duties in England, Scotland and Wales". Ms Ghosh: I think I want to get back to you on that. Going back to the process point I raised early I know what all the constituent players in that story are about; I do not know the origins of the review or indeed what its outcome is. Q25 Chairman: Because it has some quite critical things to say about those public bodies which appear to have a statutory sustainability requirement and it makes, for example, observations. It says: "Some organisations whose primary function relates, for example, to economic development see their contribution to sustainable development solely in those terms". Well, I think that illustrates the point, that if I have unearthed through, in the nicest sense, my amateur searches for truths on this something which has come across your radar, and I appreciate you may not know everything that is going on, but according to this it is a body which involves both your Department and the Sustainable Development Commission in appraising how bodies with a statutory requirement for sustainability are going on --- Ms Ghosh: To clarify that, the in-house consultancy unit is an excellent unit, that we sponsor with the Department for Transport and DCLG. We use them for a variety of consultancy projects within the departments. The unit provides an opportunity for us not to use external consultants but to use a highly skilled group of people on a flexible basis, particularly at times in their career where they want to work flexibly. We clearly asked them to do this review of how far sustainable development statutory requirements were biting. Q26 Chairman: They have some very interesting further conclusions --- Ms Ghosh: They are a very powerful group of people. Q27 Chairman: It is a good read because it addresses the question of practicalities of implementing the policies that you have just been discovering. Again, one could go through all of these traffic lights that appear, and I cannot say it looks a glowing picture of progress in what is a flagship area for your department. It perhaps may reflect the fact that these things do not appear this time in your report and you have to go ferreting around elsewhere in other sources of information to find it. One of my parliamentary colleagues, for example, in the context of the air quality issues that are covered by this made a comment to me that here we are sort of loading up outer urban London with more and more people, it creates more and more air quality issues, but the resources to monitor and to act on them are not being put in place, so you can look and say: "Oh yes, sustainability indicator, this is a very important issue", but when you come to the level of the practical, it ain't happening on the ground. Who is drawing that loop together? Ms Ghosh: Well, it is our role to join that loop together, and that comes back to the kinds of high level monitoring that we do through things like the sustainable development programme board, and it is also a job for Jonathan Porritt and the SDC to act as a watchdog and reminder. I do think there is an issue here which is the fundamental issue about communication and understanding across government, and, indeed, beyond, of what sustainable development genuinely means and the concept of the three pillars which need to work as one - just ticking one box does not mean you have to ignore the others but act as one - is quite a complex one to get across, and Jill Rutter in my Department and her Sustainable Development Unit do a great deal on that, as does Jonathan Porritt, but the concept is quite complicated, and that is why what we as a department need to do is increasingly show examples in action, for example how can we build houses in East Anglia which have a zero carbon footprint and low water consumption, how can we use the Olympics as a real example of how you can do big sporting events sustainably. This is how we get our message across to other departments. Q28 Chairman: So to sum up, we are going to see in next year's Report something that is more coherent, more freestanding, which draws together these various strands, provides us where necessary with a bit of explanation, gives us some objective performance measures, both for your department and across government - in other words, we will have almost a mini across-government sustainability report in next year's Defra Annual Report, will we? Ms Ghosh: I will promise you something that goes as far as possible towards that outcome. We will still be working on the same set of PSAs, although we will by then, I am sure, have had some discussion with you about the new framework; we will be able to pick up the SDC comments on sustainable development action plans; we will certainly have in strategic terms a clearer idea about outcomes and how we are proposing to achieve them; the only other constraint I would say we have is that one where actually Parliament, represented in this case by the Treasury, I think, requires us to simply to put some facts in there, so it cannot be fact free but we will do our best to make it more user-friendly. Q29 Chairman: Whilst we are on this, one of the people who gave evidence to us when we had our very successful session at the Royal Show, was a farmer and agricultural commentator, Guy Smith, and he made some very interesting points about the definition of farmland birds, which is an oft-used indicator for improvements generally in the rural environment, and the kind of thing, for example, that he looks at that is that the only definition of farmland birds that you use is one you have agreed with the RSPB, and he says that if you look at work done by the British Trust for Ornithology you get a different view and he quotes this little inconsistency: "Furthermore the idea that British farmland only harbours 15 per cent of the British bird population is quite perverse, as is the RSPB idea that the grey partridge is a farmland bird and the red-legged partridge is not. Similarly, how can it be that the sparrow hawk is not a farmland bird but its prey, the sparrow, is,", and he goes on to develop these important points. Are you absolutely wedded to only one measure? Ms Ghosh: Absolutely not. As I said in my introduction, that is an example of picking a PSA as a proxy rather than focusing on an outcome. I had similar conversations with farmers about the country. In Lincolnshire the other day a farmer was explaining to me the vast range of birds that the RSPB had surveyed on her land. I was up on the Chilterns and you might say up there you would regard the red kite re-introduced as a farmland bird, because it is increasingly part of the eco chain there. I think it just shows the danger of picking a very specific target to measure something that is much broader, and I think that brings me back to Madeleine Moon's suggestions about how we need a much more sophisticated way of thinking about biodiversity. Chairman: Did you want to follow up on that, Patrick? Q30 Patrick Hall: That was the point, I think! What I could try to dig out of it is if one looks at that PSA target where you say in the Report that reversing the declining farmland birds is a "measurable indicator" of ecological health, et cetera, et cetera, and, of course, the important thing is you go on to say that Defra is currently on course, summarised in appendix 2, page 274 in your Report, I am not sure how that "we are on course" statement is justified by looking at figure 11 on page 84 of the main body of the Report, which shows the farmland species as defined, as the Chairman has just questioned, but nonetheless as defined, and shows after a massive decline over 20 years from the mid '70s to the early '90s a situation of relative stability but at a much lower level since, so that is 15 years or so of no further decline, but nonetheless how can that record of the last 15 years of no further decline be cited as Defra being "on course" to meet a target to reverse that decline? Ms Ghosh: I think for the very reasons you describe. I agree, if you look at the whole picture of the line going down the decline has been catastrophic, and what we are trying to do is halt and turn it round upwards, and I think the indicators are there, and credit to environmental stewardship and looking forward, credit to things like cross-compliance for achieving that kind of reverse, but it still does not take us back, I agree, to a happy situation. Q31 Patrick Hall: I do not think, therefore, that there is evidence that Defra is "on course". It has not actually begun yet. This is a situation that, according to your own data, has stabilised itself for whatever reason since the early 1990s and more recently, subsequently, it has been identified as something that needs to be addressed, but to reverse that over the next 15 years or so there needs to be some evidence of recovery, and you are not showing that with regard to farmland species as defined by the RSPB. Ms Ghosh: I suspect one of the reasons for our confidence is we know there are lots of things that are in place looking forward that are likely to have a very positive influence. One example is the impact of the entry level stewardship schemes, for instance skylark plots which are not the most popular thing that we are buying from farmers but I think the second most popular, and, as I say, combining that kind of direct intervention with some of the improvements to the rural landscape highlighted by the Countryside Agency among others, I think we are optimistic that the decline will be reversed for those reasons, but we do need to keep monitoring it. Q32 Patrick Hall: That is a slightly different point. On the point the Chairman raised about the credibility of the RSPB definition, and I am not saying it does not have credibility, I am asking the question, the evidence we got from Mr Smith that the Chairman referred to cites work by the British Trust for Ornithology. Now, does Defra carry out some kind of assessment independent of these different groups that have a different way of looking at things for, if you like, accepting the definitions of one or another? Do you try to assess the value of different organisations' ways of looking at subjects like this? Because here we have an example of some dramatically different conclusions that can be drawn according to which set of criteria you adopt in the first place which could have a major impact on policy. Ms Ghosh: I obviously was not here at the time when we devised this particular PSA, and unless Ian has anything to say I think we will have to come back to you. I expect, because this is Defra's habitual approach, that we consulted pretty broadly on how to define the basket of indicators and therefore, in this case, what groups of birds to look at but we will get back to you on that. Q33 Patrick Hall: So you will contrast and compare the list between RSPB --- Ms Ghosh: No. I meant what I will tell you is why did we pick that particular group of birds and not others, and was it a consultative approach which, as I say, Defra being Defra I am sure it was, given our close links to certainly both those organisations you describe. I am sure we did not "pluck" it out of the air, if I may use an unfortunate metaphor! Q34 Sir Peter Soulsby: I am very interested in the Defra delivery landscape map, and the agencies with which Defra works. In the inquiry we did on the Environment Agency there was considerable discussion obviously about your relationship with that particular Agency and it was an issue that featured quite prominently in the inquiry we are doing on the Rural Payments Agency, and I do not want to go into that at this stage - I shall resist the temptation and keep it for another day - but both of those inquiries have raised issues about Defra's relationship with those who are responsible for delivery of the map and its priority. Would you like to say something about some of the issues that have emerged from the relationship with those two particular agencies, and perhaps a bit more generally, and about ways in which you are looking to perhaps ensure that the relationships are appropriate and there are robust management information structures in place and these sorts of issues, and would you like to say something about how the Department is addressing those sorts of issues? Ms Ghosh: Certainly. To pick up a theme I mentioned earlier, I think we are at a developmental stage on this. The Department quite rightly as part of its reform programme in its first five years focused on the fact that we needed to have a clearer distinction but not a disjunction, I will make that distinction, between policy development and delivery, so obviously the Environment Agency and the constituent parts of what will be natural England already existed as NDPBs and, as you know, over the past few years, accelerating in recent years, we have set up a number of other executive agencies within the Department's structures, and the maturity of the governance procedures and financial controls and so on are naturally slightly different between them simply because of the relative age of some of these agencies. We now feel we need to develop a more sophisticated idea of how far at arm's length we want our delivery agencies to be at various stages of their development and how closely related we wish them to be. Clearly we want common governance approaches in terms of developmental oversight, business planning and financial tracking, but at some stages, either in policy development, in delivery, we need to be much closer to some than others. One of the impressions I have had coming into the Department, for example, from having worked in Department for Work and Pensions is that in setting up some of these bodies we assumed we had to have a uniform, arm's length approach, and I do not think that is not true because there will always be crises, pressures, new policies that mean you need to in some cases say that we as core Defra are going to be more interventionist now than we would expect to be if business were running as usual. So, the RPA is a perfect example where actually we have been highly interventionist, as you know, we have explored in previous sessions, we have set up very close governance procedures with Andy Lebrecht of my team taking a very close personal interest, we have daily reports, for example, from the RPA on progress against 2005 payments, and that is how it should be for a department that both needs support and supervision; ditto with the State Veterinary Service, for example. At the moment when the threat of avian influenza certainly has not gone away and we need very much to be on our toes for the planning for autumn and winter, we need to be very close, as Debby Reynolds and Ben Bradshaw are, to the SVS in terms of their delivery capacity, and so on. Others of our agencies one can expect to be operating more at arms' length. I think we have been a bit lacking in confidence in making sure that we have those relationships and get it right at any given time. We are doing a review over the summer, indeed, of the governance and relationship issues between ourselves and our executive agencies. NDPBs, of course, are in a different position because there is an interesting mix between delivery agents for us of programmes (for example EA on flood-defence) and statutory advisers to us, and the same is true of Natural England. They are delivering our big environmental programmes and economic development programmes in rural areas to some extent, but they equally want to be in a position freely to advise us on some particular element of biodiversity. So, we need to be slightly more sophisticated, I think, and nuanced in our relationships Q35 Sir Peter Soulsby: When you have done this review are you intending to publish it? Ms Ghosh: I think it will be reflected in what we actually do. We are more than happy to share with you the conclusions that we reach and the structures that we have set up, and all the rest of it. Q36 Sir Peter Soulsby: There are issues, of course, from the Environment Agency, and certainly what stakeholders were saying about the Environment Agency in the communications between the department and the agency, obviously on the RPA, that would make it quite helpful if the review were to be published? Ms Ghosh: Yes. Q37 Chairman: One of the things that has always intrigued me about the RPA is you start a massive change programme, 2003, most of the work went into defining the terms of that, and as the wheel fell off at the beginning of the year, two and a half years into that, you then go through the whole process again and it is dealt with in one line in the report: "The core functions and responsibilities of the RPA will be reviewed in 2006/2007." That is a very short way of saying, "We are going to have a route and branch review", because it does raise some interesting questions as to why two and a half years ago you set off in one direction and now feel, so soon after that direction of travel was defined, that you have got to look again to see if you are going in the right direction. Ms Ghosh: I think, as we have, indeed, touched on some of these issues in previous sessions, the focus of David Hunter's review, which is going along in parallel with the more direct action that Tony Cooper, under Andy Lebrecht's supervision, is taking forward to deal with current problems, is to ask questions about the appropriate functions for the RPA going forward. We went into the change programme and, indeed, have been operating on the basis of a certain set of assumptions about the role of the RPA and broader inspection and enforcement sorts of areas, and I think we need to revisit it. Putting it bluntly, it may be that effective delivery of a payments operation should not necessarily be included in the same kind of organisation as a set of inspection functions, and we need to be clear whether there is actually an argument for separation of functions or re-organisation of those sorts of functions in a different way across our delivery family; and that is the kind of thing David is going to be looking at, but he is very much trying not to interfere with Tony getting the show back on the road. Q38 Mr Drew: In terms of this whole area, obviously there is the issue of co-owner ship of the public service agreements and there was a view that Defra feels that it needs some more clout. I know there is an issue of legislation, but one area where Defra could do invaluable work is to much more closely work with the Food Standards Agency. I know its a legislative quirk that ended up being accountable to health, but we have got the contributory bulk organisations - the State Veterinary Service, the Pesticide Safety Directorate - surely you should be saying to government that you must have purchase over the Food Standards Agency, otherwise it is just silly, because health cannot do that role, it has got far too many other things to do, but it is a natural Defra responsibility. Ms Ghosh: You will be more familiar than I am with the debate that went on at the time of the FSA and its setting up and the Government's reporting arrangements. Clearly, there were very particular circumstantial and political reasons why it was ultimately set up as a Department of Health agency. Ian may know more detail about this than I do in terms of SLAs and so on, but I know that there are extremely close working arrangements and co-operation between SVS, the Meat Hygiene Service and the other bits of our delivery landscape. As with all these things, you could draw the lines between agencies and different departments in different sorts of ways and achieve better co-operation, but I think the settlement that we got was the one that responded to the political concerns. I do not know; are there any formal arrangements we have with the FSA? Mr Grattidge: I am sure there is collaboration in a number of areas, and I think we do work closely. I think we do respect each other's space. The Food Standards Agency was created as a non-ministerial department, and the composition of that department is to give a degree of independence to the advice that it gives the public, and, clearly, we can work collaboratively and we can work in our own areas, but I think Food Standards would jealously guard its right to give its own opinion, but I think at the operational level certainly we do work closely. Q39 Mrs Moon: Just an observation, Chairman. If you were looking at the Rural Payments Agency, if you had come from abroad or outer space and you had never heard of the Rural Payments Agency, you knew nothing of its history and you read this report, you would think there was no problem. The business process, forms were issued to all known potential claimants, the target was met - this is at page 159 - the customers - it all goes on. Targets are wonderful and I do wonder where is the honesty about the disaster that has been the Rural Payments Agency. It certainly is not in Chapter 5. "We are on course for funding operations within three per cent of forecast provided to Defra at the third Quarter Review". It is wonderful if you read this report. So, how can we see this report as reflecting the real Defra as opposed to just a positive spin when an agency that really has been a disaster is described in really such glowing terms in terms of its targets? Ms Ghosh: The simple answer is the time when the report went to press. When this report went to press we had not, I think, bottomed out the problems that there were there. Clearly, we would have known by then about missing the February promised payment window, but I do not think we had had the chance to do the forensic analysis of how quickly we might get out of those problems, moving forward from April/May to now I am pretty sure you will see a very clear explanation of those problems in next year's report which will also have been covered by the report from this Committee, the PAC and others, but I can assure you we will be very honest in picking those up. Q40 Chairman: I have to say bluntly to you, you have made very heavy weather of providing this Committee with the documentation which you promised us, and I gather that there is a hope that by the end of this week, in the ever-receding target that it is going to arrive, it will arrive. Why has it taken you so long to pull together the information which you clearly assured us we were going to have when we took evidence from you in our RPA inquiry? Ms Ghosh: To be completely frank, because the kinds of promises I made at that meeting are ones which I have had subsequently to negotiate with other parts of government, particularly, for example, around the OGC Gateway Reviews, I think these negotiations have now reached a conclusion and we will be able to give you the material that we promised, though I know we are in discussion with the clerk about the sort of terms under which we do so. So, humble apologies. My instinct is openness. Sometimes I should know better. Q41 Chairman: In the spirit of Glasnost, which still pervades, are you going to be able to give us some assurance that the one final piece of the evidential jigsaw puzzle will be made available to us, because the Committee are extremely grateful for Lords Whitty and Bach, who have very kindly agreed to come and give the benefit of their perspective, and we thought that the evidence that we had from Mark Addison was of a very high quality and very clear, but you will be unsurprised if I mention the name Johnston McNeill, because he is still the person who does know the most about what happened and is still proving to be the least accessible. Can you tell us what status Mr McNeill presently has, as far as Defra is concerned, and are the Committee going to be allowed to have him as a witness? Ms Ghosh: Johnston McNeill continues to be on gardening leave and is in negotiation with my HR team about the terms of his departure or next role. We have had, as you know, Chairman, some discussion with the Clerk to the Committee about the invitation to him and we will take things forward on that basis. Q42 Chairman: Are you able to give us some indication as to timetable: because whilst we have extended the timetable of our inquiry to take advantage of the two former minister's evidence, we cannot have an open-ended inquiry and we are trying to be balanced, fair and accurate in what we report on? Ms Ghosh: Yes. Q43 Chairman: If one takes Mr Addison's evidence, then clearly there are many ingredients from his perspective that have influenced the events of the past and therefore, if we are going to be fair to everybody, Mr McNeill's contribution would be of considerable value. Ms Ghosh: Yes. I think part of my answer to that question is one that I would not want to give in open committee, given that it raises personal issues about the individual involved. I would say that, in principle, neither David Miliband nor I are in any way opposed to the idea of Johnston McNeill appearing before this Committee. Q44 Chairman: That is helpful. I think you understand the imperative in the timetable that we have to deal with. Ms Ghosh: I do. Q45 Chairman: Perhaps we might move on to questions of efficiency savings. You decided that £610 million was going to be your department's efficiency target. How did you decide that 610 was the right number and what proportion does it represent of your department's expenditure? Ms Ghosh: I was not around at the time and I will hand over to Ian. I am sure, as always, this was the nature of the debate between ourselves and Her Majesty's Treasury and the Office of the Government Commerce as to what was an appropriate figure. Again, the issue of what proportion it is of our spending is more complex than at first appears because there are parts of our spending that are susceptible to this kind of efficiency activity and parts that are not. So, you cannot simply see it, for example, as a proportion of 3.9 billion, which appears to be our spend, but I will hand over to Ian about how we reached that figure and what figure would we compare it with in terms of our spend on which we could focus. Mr Grattidge: Very simply, the process of arriving at an efficiency target, as Helen suggested, took place over the 2004 Spending Review, and I think it is probably fair to say it was a mixture of top down, bottom up in the way it was arrived at. In terms of top down, the Treasury set some fairly clear signals about the level of efficiency they were expecting departments to make, and, very broadly, the Chancellor announced, I think, levels of about two and a half per cent per annum of which half would be cash releasing, either to be reinvested in new activity within department on front-line services, and half of which could be recycled in the way of productivity gains. It would not release cash but it would help improve productivity. Defra's approach to the efficiency programme was to review the portfolio of change activity or business improvement which could deliver efficiency, and that was the bottom up bit of the process. We were able by the end of the SRO formal negotiation to identify about nine per cent of our spending, which by the end of the third year would be delivered in the form of improved efficiency. That is the main core departmental spending. Within the 600 million, which we are scheduled to deliver by the end of 2007/2008, we also have responsibility for overseeing improvements in the cost of waste collection by councils, waste management, and there the position is slightly different because we do not actually have direct control of the budgets that local councils have, but we do have a policy responsibility for improving and meeting current targets on waste around landfill and around recycling. Q46 Chairman: Let me stop you at that point for a point of clarification. How are you accounting for the local authority input to your target? Mr Grattidge: We rely entirely, having been through the process with DCLG and OGC, on material that local councils themselves produce, which report half-yearly how they think they are going against meeting their waste targets. We have worked with the OGC and with a number of colleagues in these intermediary bodies, these centres of excellence, to produce a reporting tool kit which actually factors in all the various costs. Q47 Chairman: Help me to understand the mechanics. You are giving a very clear explanation but, if local authorities are going to carry out their waste functions more efficiently, that means in a financial year, either 2006/2007 or 2007/2008, they are going to have less money than in the period when you established your efficiency programme. Either that or they are going to hand back to the centre money which they do not need, or they are going to deploy some money which they have been given as part of their block grant for other purposes. I am anxious to know how the centre can recoup the £135 billion target, which is the 2005/2006 local authority target, how you get your money back. Either it has not been given out or you are going to get a divvy and it is coming back. How is it done? Mr Grattidge: It is done through the plans that are prepared by local authority chief executives, some of which will be definitely targeted towards waste and some of which will not, and it is very much down to how the local authority chief executive decides he wants to tackle improved efficiency: because each authority, as I understand it, has a target, but they are given some discretion as to how they deliver it. Q48 Chairman: Tell me about the money bit of it. Mr Grattidge: The money for environmental services comes through the block grant, and there are assumptions in the block grant settlement about the level of spending that local authorities will have. It will take account of improved efficiency, but it also takes account of issues like increased waste arisings and the underlying pressures that councils will face both in terms of increases in volume and also of the need to divert waste away from landfill into other areas. Q49 Chairman: Just to be very specific, if I were to get somebody (your equivalent) out of the Communities and Local Government Department and say, "Have you now got sight of £135 million which you thought you were going to spend but you have kept it back and local authorities have not got it? We have actually captured this saving for the centre and, therefore, we can credit that to Defra", would they be able to show me how they had accounted for that? Mr Grattidge: Yes, because each local authority reports twice a year to DCLG and we get to see that information as well. Q50 Chairman: I am sorry to labour the point, but I want to know if this is a real saving. If you were going to have 135 million as a saving, it was either, "Mr Local Authority, you were going to get £100 for this thing but your share is a fiver, so you are only going to get 95. So, we are taking the saving before you have made it. How you make it is up to you." Or you say to them, "As you can demonstrate the saving, we will claw it back", or, "We will let you spend the saved money on something else we want you to spend it on and we will credit the centre with the saving." I am not clear how the saving--- Ms Ghosh: Can I suggest there may be a third option, which Ian hinted at, which is you deal with a larger volume of waste arisings more efficiently than you would otherwise have done, and so you may never see money at all. Q51 Chairman: So it is a productivity gain? Mr Grattidge: Some of it will be productivity, but I think it is actually a mixture of the first and the third to the extent that the Treasury will have assessed the extent to which they would have expected local authorities to improve waste efficiency, and that would have been reflected in the Spending Review block grant that went out to them. To the extent that I think local authorities can improve on the assumed target that the Treasury will have given, then they would be at liberty to retain that money, recycle it either in improved waste management or in other services. Q52 Chairman: So, in absolute cash terms, it is not actually a saving, it is an increase in productivity which the Government says is worthwhile having. In other words, we all work for the same money but we are still spending, in terms of the block amount, a larger sum than we might have been? Mr Grattidge: I think in the second instance where they improve on it, yes, it may well be manifest in the form of, "Yes, it is an improvement in productivity", but I think that if you say to somebody, "Normally I would give you £100 to conduct this service, but because I think you can be more efficient at it, I am only going to give you 97", that, in effect, has released the cash to the Treasury and it allows the Treasury to reinvest that in other services. Chairman: We will not labour it any more, but perhaps you might, jointly with the appropriate department, produce a little note so we can see how this piece of magic is actually being done and accounted for, because we like to think that our savings are real. Q53 Lynne Jones: I hate to go back to the RPA, but when we saw Johnston McNeill in January he said that the RPA would meet their saving targets of 39.9 million from April 2007 as a result of the Change Programme. Is that likely to happen? Mr Grattidge: I think at the moment we think it is likely to happen, but it will be delayed up to a further 12 months. Q54 Lynne Jones: So that will affect your overall departmental efficiency saving? Mr Grattidge: It will, but in the way of things, we were aware that there was potentially some volatility in the RPA Change Programme in particular and we took early steps to identify contingency that we could use in its place, and that has been done. Chairman: I am just going to stop you there because Peter wants to come in, but we have three minutes before a vote and I need to know from my colleagues if they are all going to be able to return to continue our questions. It is okay; we will continue our examination. As the vote is going to be timed, and to save time, I am going to suggest that we adjourn now and go over to the lobby so that we can be there for the vote and come back as quick as we can, and then Peter will come in. The Committee suspended from 4.54 pm to 5.18 pm for a division in the House Q55 Chairman: We were just concluding, I think, on seeking in writing a little information on the saving of the waste target, and I think we had drawn that matter to a satisfactory conclusion. I would like to probe a bit more about overall savings, because obviously the biggest item of expenditure on your budget are the staff in your department, and annual reports sometimes present a picture which, unless you have somebody to give you a guide as to what it is you are seeing, you can get the wrong impression. Ms Ghosh: Yes. Q56 Chairman: So, let me start off with what might be a wrong impression. I note that in terms of total Defra the number of staff that the department employed in 2000/2001 was stated in the Annual Report on page 265 as 10,568. If I look at the estimated figure for the current financial year, it is 12,806. This does not strike me as a sort of move towards greater efficiency, when the number of staff seen over a period of time when there have been changes in the Common Agricultural Policy enabling staff to be reduced, that your staff numbers seem to be going in the opposite direction. Why? Ms Ghosh: There are a number of complex, as you imply, Chairman, net and gross movements going on in our staff numbers. The target figure that we have been set under the efficiency programme, as you know, is 2,400 staff across the core department and all its agencies, and a large part of that saving in staff was due to come, I think 1400 (Ian may correct me) from the RPA Change Programme. Although they have produced savings thus far in permanent staff numbers, equally we have had to put in a large number of casual staff (there are about 500 odd there at the moment), which has to some extent offset those savings. Equally, we have been recruiting small numbers of staff elsewhere in the department in the efficiency period to respond to priorities, notably in the climate change sort of area. This brings me, I suppose, to the summing-up, and I think it is back to your very first comments this afternoon, Chairman, about how does one get a clear picture about whether things are going well or badly. I did have to, as you probably know, send a message to staff in Defra a month or so ago to try and clarify where we were, and my message was a fairly stark one, which was that, as we were at the moment, we were not doing as well as I would have hoped in our progress towards our 2,400 saving, for the reason I have described, and so what we are doing across the department is introducing a much more, I supposed one would describe it as Stalinist set of controls about recruitment, about the use of natural wastage, about use of the "priority movers pool" as a first pool when there are vacancies in the department. We are going to have centralised approval of external recruitment. We will need some external recruitment, because we need to refresh our pool and get skills in. We are going to have, subject to budget pressures this year, a voluntary early retirement scheme to restructure. It is undoubtedly the case that there will be a challenge to us in meeting 2,400, in particular because of the savings that were due to come out of the RPA, and we have already had some discussions with the Office for Government Commerce to say that it may well be that some of the savings which the RPA are still promising, but on a slightly different time profile, may well come after April 2008 rather than before, so we need to start working, as we are, on contingency. I do not know whether you want to say anything else about that. Mr Grattidge: No, except it is very tight. The 2,400, we will either just squeak in or we will slip a month or two, but it is around that period that we are expecting to bring in the staff reduction? Q57 Chairman: What happens if you do not meet your efficiency target? Does the Treasury just come along and say, "Tough, I am going to take the remaining money out and that is it as far as your budget is concerned"? Ms Ghosh: Of course, by the time we get to April 2008 we will be in CSR07 territory, and we will have been set by then a new set of running costs and spending profiles. So, in fact, the kind of debate that will be going on through the coming months as part of the CSR07 process will be an interesting blend, and Ian and my HR director will be at the front-line of this and making some estimate of the efficiencies we are hoping to achieve and no doubt a new set of challenges for the CSR07 period. So, I think it will be one of those cases of, if we failed to achieve 2,400, we would simply find them built into a set of efficiency challenges for the new CSR07 period. They certainly will not go away. Mr Grattidge: In terms of financial savings, you will be pleased to hear the Treasury will credit departments that over deliver. Therefore, they will be allowed to store those as part of a target going into the CSR07 period. Currently we are forecasting on the financial side that we will be slightly over the target we were set. Q58 Chairman: Just before we leave the financial side, because I do not want to keep colleagues unnecessarily long and we have one or two other important areas probe, I notice in the material which you kindly sent in advance of today's hearing on page two some monies that you are putting to one side, I presume a contingency, or "provision", it says here, for various forms of disallowance in the CAP, and you have got two figures which seem me to me to suggest that you are sitting on £187 million as a contingency for disallowance. Would you like to account for how that money is put together and why? As it stands, that seems quite a large sum of money, but against the 1.7 billion I suppose it is a relatively small sum of money. Mr Grattidge: Absolutely right. It is actually rather higher at that level than traditionally we have had to pay in disallowance. There are two components to this. The first one really arises from the fact that the budgetary control regime round CAP now forms part of our mainstream departmental expenditure limit - it was switched from the way we managed expenditure last year - and we judged that one way of managing the impact of that on our DEL was to bring together onto a common reporting basis CAP expenditure, CAP income from the EU and disallowance, and there is a slight change in the way we have accounted for this, and what we reflected we would need to do would be to bring into our 2005/2006 figures all the outstanding disallowance from previous years, because disallowances can actually take two or three years to be confirmed. So, what we reported for the end of last year is all outstanding disallowance from previous years and we have taken a view, because we are on a common reporting period, what do we think the disallowance will be for SPS2005. The component roughly splits. It is, I think, about £60 or £70 million worth of potential disallowance hit from previous years added to something just over £110 million for SPS2005. So, that is very roughly how it works. Ms Ghosh: Can I reinforce the point that, I think, David Miliband made to you last week, which is, of course, while we have to make provision for potential disallowance around the SPS 2005, there are continuing negotiations going on which we would not want to prejudge by setting any particular figure with the Commission, and, as Ian said, one does not actually know the outcome for a number of years to come and we will, of course, be fighting our corner as hard as we possibly can. We have to make a prudent provision there, but I would not like the prophesy to be taken as the reality. Q59 Sir Peter Soulsby: While we are on the savings, Chairman, but just more generally, can I go back to the delivery landscape and ask what approach the department is taking to the wide range of bodies that are represented there and their budgets when you are looking at savings and budget cuts? Ms Ghosh: One thing that is challenging and striking about the way Defra's financial flows work is that so much of our money goes out through delivery agencies. Obviously, the biggest chunk is to the Environment Agency, a significant chunk to Natural England, within the department also through SVS, for example. Equally, a very challenging thing about that financial structure is that in many cases those bodies have had to give some pretty high level of future commitment. We have got people who are locked into agri-environment schemes for ten years, we have got them going through the ELS[1] and HLS[2] process, clearly, in flood management, you have to commit in advance to get the spend out as you plan. I think, in general terms, we have very good financial links with the various agencies and we are absolutely aware of the issues about trying to provide some kind of certainty, because we recognise that it is extremely difficult to manage those sorts of budgets without some long-term certainty. As I think you know and I think you raised with David Miliband last week, there are some very particular difficulties about this year's budget where I think we have failed in our aim to give our delivery agencies enough warning. There were a number of issues that squeezed our 2005/2006 budgets, there was the removal of the end year flexibility we were expecting of 75 million or so, there was Treasury reclassification within our overall parliamentary vote of near-cash and non-cash spending, which suddenly gave us less flexibility. We coped with that by pushing some spending forward into 2006/2007 on the expectation that things would be easier this year, and we also gave our spending bodies, those two big bodies in particular, some advanced warning to plan on the basis that they were spending only 95 per cent or so. As it has turned out and it has become clear from the beginning of the year, we were probably at that point over-optimistic, for which I know we would like to apologise, and we will be discussing with the delivery bodies concerned, both at official level and at ministerial level, the implications of that. We are very keen to give them early certainty. The issue is not that we would have been able to give them allocations of more money had we done so earlier in the year, but we could have given them greater certainty. Looking back on it now, had we been less optimistic---. Mainly it has to be said that Defra historically has been an underspending department rather than an overspending department, but I think the increasingly good financial management that Andrew Burchell and now Ian and his team do to track exactly what we are spending and also the fact that the whole spending context has got tighter has meant, in fact, that we are not an underspending department any more. I think we came in practically bang on in 2005/2006, but the idea that we went into 2006/2007 slightly over programmed reflects a sort of optimistic, slightly Mr Micawber'ish sort of approach. So, we are working it through with the agencies, David Miliband is very clear we need to give them certainty quickly and that is what we are aiming to do this side of the summer recess. Q60 Sir Peter Soulsby: What I think we are being told is that, for a variety of different reasons, the department is having to revisit budgets for the current year? Ms Ghosh: Indeed. Q61 Sir Peter Soulsby: That agencies and bodies thought they had fixed? Ms Ghosh: To be absolutely accurate, we have not given them firm allocations for this year yet. They are actually operating on the basis of no allocations but on the earlier guidance that they should not commit more than 95 per cent of their big programme budget. Q62 Sir Peter Soulsby: Let me put it in a different way. Perhaps not fixed, but thought they could reasonably expect given the sort of indications that they had been given? Ms Ghosh: Yes. Q63 Sir Peter Soulsby: Is it possible for you to quantify the scale of the problem, either in percentage terms or in cash terms? Ms Ghosh: The scale of the problem in terms of what we know about now, and we have been sharing this openly with both our agencies and our delivery bodies, is around £130 million, but also, of course (and this is obviously one of the issues we need to discuss with ministers as things harden up), we need to consider what further contingency we might need for later in the year. As I say, I think we could say that it is definitely around 130 million, and there is a debate going on within the department and with the agencies about how much more we might need to find as a contingency. To give one example, one of the pressures that we have had to meet is around, I think, £14 million or so, though we are looking at the bills. We are looking at the outbreak of avian flu in Norfolk. As you know from all the predictors, there is a high risk that we will get an outbreak of avian flu following the autumn migration and, therefore, we have to consider how we would meet any costs arising out of that, so there is a bit of a judgment about handling risk going forward. Q64 Sir Peter Soulsby: Can you put that as some sort of percentage? What does it represent, the £130 million, and what further percentage might it necessarily represent? Ms Ghosh: Of the sort of available spending. Q65 Sir Peter Soulsby: Of the funds that are going in that direction, yes? Mr Grattidge: The figure of £130 million is around about five per cent of our resource near-cash. Ms Ghosh: Overall. Current spending. Q66 Chairman: Can you clarify, because I cannot say that I am fully up to speed on the new landscape of descriptions. If we net out from your expenditure the CAP monies, because you said those had been brought into your annual managed expenditure figure. Mr Grattidge: Yes. Q67 Chairman: If you take those out, because what I think the Committee is interested in is what proportion of the remainder of the expenditure of Defra the 130 represents? Mr Grattidge: It is five per cent of non CAP current expenditure, basically. CAP expenditure, of course, is largely netted off because most of the spending is---- Ms Ghosh: It is not the case that all the CAP expenditure comes in, but issues like disallowance do come in. Thinking a bit schematically (and Ian will correct me), our headline budget is around 3.6 billion. You can take out of that what we used to call capital and non-cash spend, which represents--- Mr Grattidge: Capital is about 800 million, 750/800 million, non-cash is about 300, I think. Ms Ghosh: So, you are down to about 2.7 billion. So you take that out and that produces 130 odd, being five per cent. Q68 Sir Peter Soulsby: To check that I have understood this correctly, that is money that will be need to be found from the budgets, in broad terms, of those who were here from the department? Ms Ghosh: And, indeed, from the corporate centre of the department, but, again, to give you some idea of the dynamics of the way our money moves (I am going to get the figure wrong, which is why I am turning round and looking at Ian) 78 per cent of our spend goes out through 25 programmes; so we do not spend our money across a very large range of programmes almost equally. If you are looking for large amounts of money, you have to look at a relatively small number of programmes. That is the process ministers are going through at the moment. Q69 Sir Peter Soulsby: So, inevitably, that means that the Environment Agency, Natural England? Ms Ghosh: Natural England and other agencies. Q70 Sir Peter Soulsby: Have got a pretty big headache facing them? Ms Ghosh: Yes. Q71 Sir Peter Soulsby: Already a quarter of the way into the year, something of that sort? Ms Ghosh: Yes. Sir Peter Soulsby: With the prospect of big cuts. Q72 Chairman: Just to ask the idiot question, you may have said it and forgive me if I have not picked it up, what was the cause of your having to find this 130 million? Ms Ghosh: As I say, we came in pretty well on budget for 2005/2006, but one of the things we did, for example, to ease 2005/2006, because of loss of EYF and reclassification problems, was to push some programmes, some elements, for example, of flood defence, into 2006/2007 on the prospect that things would be easier then. As it has turned out, things have not been easier, so we have to meet that money that we pushed forward. We have not been able to reduce, for the reasons discussed extensively, RPA running costs in the way we might have done. We have got AI costs coming in. A range of issues have meant that the optimistic approach we took with a bit of over programming (i.e. we assumed, we budgeted, we distributed budgets to the various DGs at around, I think, 2.5 per cent above what we actually had) actually proved to be risky. Why did we do that? For some of the reasons that I have described. The history of the department is under-spending, and I think we had underestimated the extent to which we were now a department that did not under-spend but had to control our finances very tightly to come in on budget. I do not know if you want to comment. Mr Grattidge: Only exactly that, that when we are underspending we will tend to over programme on nominal figures because the rate of take up will actually catch up by the end of the year. We are almost in a situation now where we have got an established contingency so that when we go into the year we have got some head room between the total budget and what we have allocated to different parts of the organisation. That is the only cushion we can give ourselves for managing pressures. Ms Ghosh: The other thing, again, having had discussions with the Secretary of State and other ministers, of course, given the kinds of signals that the Chancellor is sending out and the overall tightness of the fiscal position, I think what this points to us is that we need, as part of this exercise - we are delivery agencies - to have a very clear forward plan over a number of years as to how we are going to live within what is inevitably going to be much a much tighter spending envelope than we have now. So, we certainly cannot be promising our delivery agencies jam tomorrow. I think it is working together to live within that kind of financial profile over a number of years. Q73 Sir Peter Soulsby: Somewhere in the region of five per cent has to be found? Ms Ghosh: Even to meet what we know now. Q74 Sir Peter Soulsby: And then perhaps as much again to meet a contingency later in the year? Ms Ghosh: I think that is where ministers have to make a judgment, and we are working now on how much contingency one needs for later in the year. Q75 Sir Peter Soulsby: But, in broad terms, it could be five per cent now and five per cent later? Ms Ghosh: It could in theory be that, but that is the kind of debate that we will have to start having with finance directors to get certainty as soon as possible. Q76 Lynne Jones: You spend about 155 million on research and development. The biggest chunks of that, 34 million and 39 million, go on sustainable farming and food and animal health and welfare? Ms Ghosh: Yes. Q77 Lynne Jones: Can you give us some examples of the kind of activities that are funded with this money and concrete examples of where this has had a beneficial impact? Ms Ghosh: Let me give you an example on sustainable farming and food. To set the context, and, as you know, this has been the subject of wide debate and that is why we have consulted on our Evidence and Innovation Strategy, our policy going forward is to realign our spending on research away from what one might call the traditional agricultural research, which at the moment perhaps receives a disproportionate, in strategy and policy terms, proportion of our spend, and into, if one thinks of it schematically, the environmental side of the department's activities. Much of the traditional research we used to do, for example, about crops and grasses and so on is actually pretty mature, we know most of the answers. One example of the kind of research we have been doing, and I think it is due to finish this year, is at that interface between sustainable farming and the department's other objectives. There is a very interesting bit of research, which I was reading about recently, to look at the impact of inserting skylark plots into cereal growing and whether or not, if you had a certain number of these, it had an impact on the gross output of cereals. It proved that it did not and it proved that this was an effective way of both promoting our farmland birds targets but also maintaining the outputs that we needed, and that is what has been built into our ELS programmes, one of the options being skylark plots. We knew that skylark plots would not have a significant impact on farming; so that is an example. In the animal health area, there is a wide range of kinds of research that goes on at the Veterinary Laboratory's agency down in Weighbridge on, for example, BSE. Clearly, as you know, since it has been much in the news, we are using our research funds to look at bovine TB and the various issues around impact and origin and the outcomes of the Krebs trials, so it is those sorts of things, but I think the real challenge for us in the future is whether those are the right things and whether or not we need, in some areas of the department, a better evidence base. I am very struck by the fact that, if what we are is an influencing department, and David Miliband has talked a lot about the environmental contract and what citizens will do, what the Government will do, what business will do, we probably do not know enough at the moment about how we have influenced these various groups to do things. For example, we do not have that many. We have a small, but very good, team of social science researchers in the department and we probably need to have more, because behavioural stuff is probably something we need to do more of, and, as I say, less of the areas where we are comparatively mature. You will see, I think, over the coming years, and particularly as we face up to whatever faces us in CSR07, that we need to rebalance things a bit. Q78 Lynne Jones: You have got a Science Advisory Council and they are mentioned in the report? Ms Ghosh: Yes. Q79 Lynne Jones: How do you respond to their criticisms that you have not got sufficient funds to conduct your science programmes to underpin the Government's policy goals? You mentioned that we know all the answers in relation to crops and grasses, is that something that they have told you? Ms Ghosh: Our science programme is developed in consultation with a very wide range of people. It is certainly not the case we have just sat in the department and thought of our Evidence and Innovation Strategy. We have the Science Advisory Council. As you know, Howard Dalton, our Chief Scientific Adviser, sits on the board of NERC and interacts a lot with BBSRC, so the conclusions we have reached are on a very wide range of consultation of that kind. Of course, moving out of any particular area of research, and I know there are particular issues about grasslands and the various institutes to do with grasslands, difficult decisions have to be made, but Parliament votes us a certain amount of money and we have to decide what is the best bang for our buck, bearing in mind the sustainability points that we discussed earlier about making sure there is at least the capacity to do research in other areas as it arises, but we cannot continue to support the wide range of research that we support now. Q80 Lynne Jones: Is not research and development absolutely vital, not just for your department and the agenda that you have got but the whole government, the whole economy, the climate change sustainability agenda? Ms Ghosh: Yes. Q81 Lynne Jones: You did not answer my question about whether that is the advice you are giving, that on crops and grasses we know most of the answers. Ms Ghosh: I am sorry. I am very happy to come back to you specifically on that. I know that the view that has been reached in the Evidence and Innovation Strategy is that there is a limited pay-back from extensive further research, but I am happy to come back to you on that. Of course, because we are an evidence-based department, it would be wonderful to have an infinite amount of money to spend on research and development, and of course the Science Advisory Council will have strong views on this point. I think the point you make about we need to be spending more money on the climate change area is one, for example, that we are trying to meet in rebalancing away from traditional agricultural research, although sustainability of agriculture will remain a key area of research, and its impact on the rest of the environment, into climate change sorts of areas. I think the Government's commitment on this is reflected in the fact that when we announced the Climate Change Programme Review we agreed, I think, an Environmental Technology Fund, precisely to look at that kind of innovatory technology, low-carbon, renewables sort of energy research, so I think we are seeing a shift away, but we cannot spread our jam thin, we have got to decide where we are going to spread it thickly for the best outputs. Q82 Lynne Jones: One area of potential technological advancement is on areas, for example, biomass and biofuels? Ms Ghosh: Indeed. Q83 Lynne Jones: Which is both related to sustainability of land use and also the Climate Change Agenda. I understand that the Science Advisory Council has actually expressed concern about the reduction in land-based research. It is good that there is money going into climate change research, but they are inter-related; it is difficult to distinguish between the two. Ms Ghosh: I do not know the details of the investment we are currently putting into the biomass research side. I know money is going in, but we will happily send you the details of that. In a sense I was excluding that. That is not traditional, that is, as it were, how we move our research budgets into the new world of sustainable agriculture as it contributes to wider--- Q84 Lynne Jones: The Institute of Environmental Sciences Research is involved in agricultural biotechnology, and there is a lot of concern, for example, on the Centre of Ecology and Hydrology. You are losing posts in areas related to climate change and one has to wonder whether there is real coordination. I think that is the other area of concern, coordination between your science strategy and that of the research councils and, in fact, the other agencies. Ms Ghosh: As I say, Howard Dalton is certainly a representative on NERC and I know has had a number of meetings, if he is not on the council itself, and I can confirm that, with BBSRC on precisely the points you make. So, I think we coordinate extremely closely, but there are hard decisions that have to be made sometimes. I will certainly come back to you on how we are supporting research on biomass and biofuels. Q85 Lynne Jones: How do you co-ordinate with other departments in this area in terms of the DTI and the Energy Review because climate change and energy are inter-related? Ms Ghosh: Which I think is very much reflected in the outcomes. Q86 Lynne Jones: How you co-ordinate that because, on the one hand, you could say that NERC is reducing their work on climate change and you are increasing it, maybe that is complementary, but maybe you have got different priorities and maybe there is something wrong if you are not both seeing areas for expansion, you are seeing different areas for expansion. It does not seem logical. Ms Ghosh: We will send you a note on that certainly. Q87 Chairman: At the beginning of the evidence you were candid enough to question whether you have got the right PSA targets and I think gave the impression that there may be some new ones coming along as part of the Comprehensive Spending Review process. If that is the case, are you going to publish those for any kind of consultation? If so, can we have a copy so that we can have a look at them before they get cast in concrete? Ms Ghosh: As with many elements of the CSR 07 process, it is iterative and although, as you will probably know, the Treasury has been doing some preliminary thinking about what the structure of PSAs might be, and we have fed in some thoughts, I do not know now, unless Ian can correct me, how the process of developing detailed PSAs will be taken forward and what consultation we will be proposing. As I said, we would certainly find it valuable to share with the Committee, in whatever form you think appropriate, ideas once they have reached a stage of specificity on which you might want to comment. Do we know a timetable for the process? Mr Grattidge: Only that we submitted our response on the PSA Review that the Treasury are conducting earlier this year, I think in June. All departments did something similar, so they critiqued how did the PSA actually get delivered and how do you know it is working and, secondly, what ideas do you have for improving the PSA framework in the future. I think all departments have now submitted their responses and the Treasury are looking at them over the summer. I think the next phase will be September, but the Treasury have only said, "We are going to read them," they have not said what the next phases are. They are going back now and considering how they work. Q88 Chairman: It is difficult for you to be more specific as to when we might have a discussion about them. Perhaps that is the Treasury ringing you saying that they have now arrived and we can crystallise this out! We would be grateful if you would keep us posted on that because some of the targets are cast in rather vague and woolly terms and, as we have seen, some are proving quite challenging, to use a favourite departmental word, to quantify as to whether they are achievable or not. So I think we would very much welcome an opportunity for discussion because obviously they do form a key underpinning role to the work of your Department. Ms Ghosh: To give you a flavour, there are these issues that you have discussed with me before, and Brian Bender before that, about the effectiveness of shared PSA targets. Are shared PSA targets effective or would it be more effective to have overarching government framework objectives and then individual contributions measured by department? We have a number of PSAs where the levers are not in our hands and certainly the spending is not in our hands so, for example, if you look at the rural PSA, many of those aspects of spending, other than the money we put into the RDAs, are actually not in our hands. Two things we would aim at: that we have much clearer outcomes and that we are very, very clear what the leaders are that we have to achieve them and, back to the point made earlier, that there is a wide consensus that the particular performance indicators, whether it is biodiversity or climate change, are the right ones. Q89 David Lepper: Just on the comment you were making just now, Mrs Ghosh, about shared PSA targets. One of those is I think target seven, eliminating fuel poverty, which you share with the DTI. I think the current assessment is that by 2006 the numbers of fuel poor people is likely to be up to two million. I just wonder if you could tell us something about where the ability to manipulate the levers lies there? Is it with your Department mainly or with the DTI and how do you work with the DTI on that particular target? Ms Ghosh: I suppose we have two main levers there. You are absolutely right, the figures are disappointing and they are disappointing primarily because of increases in fuel prices. The way that the target is measured, spending more than ten per cent of income on fuel means that fuel prices and their rapid increase will push us back. I suppose we have two main areas of impact. One is through the Warm Front programme which, as you know, is focused on lower income households and in particular recently has been about energy efficiency and insulation and central heating systems. One is energy efficiency more generally insofar as we can - and the Energy Review has proposed this - to put further responsibilities on the energy suppliers to take account of energy efficiency issues and also to put more money into, as we were discussing earlier, developing energy-efficient technology. So we have got those two things but actually the overwhelming influence is going to be the cost of energy. I think that does mean this target is extremely challenging for us. I think in fact it is one that conceptually is not just for the DTI but is also about incomes, employment possibilities, all those kinds of bundles of things that come together to impact on incomes and available incomes of disadvantaged families. Q90 Chairman: To draw things to a conclusion and just reflect on something which is near and dear to the heart of all of my colleagues on the Committee, because from time to time we write letters to you --- Ms Ghosh: Ah, yes. Q91 Chairman: --- Yes, and it is quite intriguing that in 2003-04 11,068 bits of ministerial correspondence, 75 per cent, were answered within 15 days. Then you girded your loins, more letters in the following year, 11,245, and 80 per cent of them were replied to within 15 days and then we go up by another 1,500 letters a year and you drop down in 2005-06 to 61 per cent. Why? Ms Ghosh: Mainly because we have had a 50 per cent increase in the number of letters we have received. In the first six months of this year we had 50 per cent more letters than in the equivalent period and we suspect that will go on at that high level. They were mainly about AI, bovine TB and --- Q92 Chairman: Hang on a minute, just before you hide behind the global figure, I am talking about items of ministerial correspondence. Ms Ghosh: That is right, we have had a 50 per cent increase in the number of letters we are receiving. Q93 Chairman: That is not what your report information says. That is why I read out the numbers of letters. We understand that the figures in 2005-06 were 12,737 letters received versus 11,245 in the previous year. Even my ropey maths do not make that a 50 per cent increase in letters. Ms Ghosh: Possibly what I am doing, Chairman, is apologising in advance for the statistics you will see for the most recent period! We have been looking at the most recent period because our ministers have been expressing concern about a backlog in correspondence. Q94 Chairman: I am not surprised. Ms Ghosh: And I know a number of Members here have been raising similar points. If you look at the last six months from now, we have had a 50 per cent increase on the comparable period for the first half of 2005 because of AI and bovine TB in particular. That has put enormous strain on our central correspondence unit. As you know, we decided as part of our reform programme to take responding to ministerial correspondence out of the line and put it in a central communications unit, which has worked extremely well in terms of the use of common knowledge banks and, in normal times, the turn round effect, but it has recently been swamped by the high level of correspondence and so we have put more resource in there on an emergency basis to try and clear the backlog, and I think we will have to put more resource in going forward. It will still be a more efficient way of dealing with our correspondence, but I think we just have to face the fact that given the greater political profile of many of the issues we deal with, we have just got to accept that we might well be looking at a department that deals with 18,000 items of ministerial correspondence a year, not 12,000. Q95 Chairman: And you are going to staff up and equip yourselves to meet the 15-day target? Ms Ghosh: Which is of course a target that is tighter than the 20-day target that the Cabinet Office sets but 15 days is our target and we will staff up to meet it. Q96 Chairman: I am afraid we will probably have to add to your burden of letters coming in because time prevents us from asking all the questions we would like to, but can we thank you both very much indeed for the responses that we have received. We look forward very much to receiving the further written material that you have promised us and information particularly in the context of the RPA discussions, and hopefully, in due course, the opportunity to comment and engage in some discussion on the future PSA targets, so thank you very much indeed. Ms Ghosh: Thank you. [1] Entry Level Stewardship [2] Higher Level Stewardship |