Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions First Report


FORMAT OF THE ANNUAL REPORT

7. Last year we recommended that the Department's Annual Report be restructured, in order to demonstrate progress against each of the Department's Public Service Agreement (PSA) targets more clearly.[5] We were therefore pleased to see that the Department's report for 2005 included a detailed Annex setting out each of these targets, formal performance indicators and milestones towards their achievement, and reports on the Department's progress.[6] We welcome the changes made to the structure of this year's Report, which have made it more accessible.

LINKING PUBLIC SERVICE AGREEMENTS TO SPENDING

8. Nonetheless, we still struggled to link specific programmes and spending to the relevant PSAs: we therefore asked the Department to provide us with a single table linking the PSAs to the activities supporting each PSA, the resources allocated to the programmes and the targets against which progress would be measured. The Department's response pointed us to the Departmental Report for the PSAs and priorities, and the 2005-06 Business Plan for milestones and targets. It told us further that:

9. We recognise that it is difficult for the Department to provide an accurate picture of its resource allocations in the level of detail we sought, when these allocations are frequently subject to change. Nonetheless it is important for the process of scrutiny that this be done. It is essential that readers of the Department's report should be able to determine whether the Department's resource allocations properly support its objectives and represent value for money. The current report does not allow readers to do this. We urge the Department to look further at ways in which it can clarify the links between its detailed spending plans and its Public Service Agreements in future annual reports.

RESOURCE MANAGEMENT

10. We must sound a note of caution over the Department's resource management. Through our efforts to secure further information about the real nature and extent of the Department's efficiency plans, we were able to establish that there is overlap between two reported efficiency targets. Some programmes are counted against both. Mr Peter Unwin, the Director General of the Corporate Strategy and Resources Group, told us that the figures concerned "were given to us as formal numbers which came out of the Spending Review and are both targets we have to report to, so we need to report to both, but I accept that we could make clearer in the presentation that there is overlap between them".[8] Whatever its cause, double-counting is unacceptable and the Department must ensure there is absolute clarity about its resource management in future reports.

11. We asked the Department two questions arising from the Resource Accounts for 2004-05: a financial irregularity, and a failure to pay National Non-Domestic Rates collected from local authorities into the Consolidated Fund, as required, by the end of the financial year. Its memorandum will be published in due course. In both cases the Department has informed us that new procedures have been put in place to ensure such incidents do not happen again. We shall review the effectiveness of these procedures when we return to this subject next year.

TECHNICAL PRESENTATION

12. In presentational terms there remain a few minor problems with the Department's report. For example:

We recommend that future reports contain a short glossary of technical terms. The Department should take particular care in proof-reading financial tables and charts.

13. There is a separate issue about the way in which the Department chooses to present its progress in delivering its outcomes. We detected a tendency to show progress in an unjustifiably favourable light, most obviously in reporting efficiency gains where programmes totalling £150,000 savings per year were highlighted as "noticeable" progress towards a target of £620 million by 2007-08.[11] Similarly Mr Housden, on being asked what the ODPM's key weaknesses were, told us that "it has been a hugely successful department in every area of its work".[12] It is early in the three-year-old Department's development to present such an unqualified assessment.

14. We are pleased that this year's Annual Report sets out both successes and problems in programme delivery so that they can be understood. We criticise the Department for an unjustifiably favourable presentation of its achievements, which is counter-productive.

Aims, targets and the core narrative

15. We also note that readers of the report have to grapple with the Department's aims, Strategic Priorities, and Public Service Agreements which were set in 2002 and "updated and added to" in 2004.[13] The different levels of targets and their inter-relationships can be difficult to understand.

16. The Department made available to us a document called the "core narrative", which is the first outcome of an internal review looking towards the Comprehensive Spending Review in 2007.[14] The core narrative aims to set out clearly what the work of the Department is for. This lists:

  • Three core values;
  • Five key drivers; and
  • Eleven key priorities (consisting of high-level goals, critical projects and cross-government priorities).

17. Mr Miliband told us that the purpose of the core narrative was to give "a focus to departmental activity"; specifically, he hoped that "when [the ODPM's staff] come to work in the morning they are involved in a project that has clear links to that overall goal" of a sustainable community.[15] The recent staff survey (which is discussed in greater detail in paragraphs 35-44 below) reported that only 59 per cent of ODPM staff understood how their work contributed to ODPM's five-year plans. This compares to a central government benchmark of 80 per cent. While we hope staff will find the core narrative helpful, we are unconvinced.

18. When we spoke to Mr Housden he told us that "clear, consistent, simple messages are a very important lesson for all of us engaged in government".[16] We agree with Mr Housden that the Department should ensure transparency and simplicity in its communications, both internally and externally. We look forward to a clear demonstration of the greater effectiveness of the Department's communications in its next Annual Report.


5   ODPM: Housing, Planning, Local Government and the Regions Committee, Fourth Report of Session 2004-05, ODPM Annual Report and Accounts 2004, HC 58 paragraph 10 Back

6   Annex A: Work streams by strategic priority, ODPM, Annual Report 2005, Cm 6526, June 2005, pp59 - 115 Back

7   Ev 32 Back

8   QQ4-5 Back

9   Annual Report 2005 Cm 6526 p40. See also Ev 42 Back

10   Annual Report 2005 Cm 6526 p127. See also Ev 42 Back

11   Annual Report 2005 Cm 6526 p45 Back

12   HC 680 (2005-06), Q2 Back

13   Annual Report 2005 Cm 6526 p17 Back

14   QQ14-16 Back

15   Q131 Back

16   HC 680 (2005-06), Q1 Back


 
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Prepared 26 January 2006