Select Committee on Communities and Local Government Committee Second Report


3  The annual report 2007

37. The CLG Annual Report 2007 covers the financial year to April 2007, sets out the Department's range of functions, delivery systems and targets, and comments on achievement against those targets, departmental organisation and financial performance. It was published on 17 May 2007, meeting the Treasury's deadline. Last year, we criticised the Department for publishing two months late and were personally assured by the Permanent Secretary that this would not occur again.[55] We further criticised the Department for, in spite of the delay, producing a "sub-standard" document that contained numerous errors of fact, typography and proof-reading.[56] The Department has taken those criticisms to heart, and this year's report represents a substantial improvement. It is well laid out and well organised, with a chapter devoted to each of the Department's strategic objectives. It is straightforward to read, and effort has clearly been made to eradicate errors identified last year. As we had requested in both 2005 and 2006, the Department has provided assessments of progress against both its headline PSA targets and their sub-targets, making it considerably easier to understand how it is performing against each component of those targets. We commend Mr Housden for ensuring that this year's Annual Report was produced on time and those in his team who have produced a report to a far higher standard than has been the case in previous years.

38. Within individual chapters, the Department's performance against its 10 PSA targets is set out in both tabular and narrative form, which makes it substantially easier than previously to track departmental progress. However, the Report would benefit further from a consolidated table pulling together the information set out individually in separate chapters on each Public Service Agreement target. This would enable the reader to see at a glance the Department's performance across the range of its activities. In addition, the Report does not note how many sub-targets need to be achieved to enable the headline target to be judged as "on course". This information may be found in the separately published Technical Note but we recommend that relevant information from the Technical Note on PSA target achievement be included in future Annual Reports to enable easier checking of progress.

39. In common with the rest of Government, the Department is required to make substantial efficiency savings following the Gershon review of the civil service. It estimates that it has saved £756 million, putting it ahead of the target of £620 million by March 2008; of that, £145.6 million (19 per cent) has been "finalised", £598.7 million (79 per cent) is classed as "interim" (meaning that the figure may change), and the remaining £11.7 million (2 per cent) is classed "preliminary" (meaning that it is likely to change).[57] Of the eight work streams against which the Department reports those efficiency savings three, all relating to RSLs, had reported efficiency savings delivered by the end of 2006 that already exceeded their targets for 2007-08. A further two were forecast to meet their targeted savings comfortably by 2007-08, but two—RSL spend on commodities and Homelessness—were forecast to miss their targets by a significant margin.[58]

40. CLG must also shed 400 posts by next March: 223 have already gone through natural wastage and voluntary retirement and early severance, and the Department expects to lose 764 posts in all. In addition, 147 posts have been relocated out of London and the South-East, and the Department expects to meet its target of 240 relocations by 2010.[59] The costs of this process are considerable—£13.3 million for the early retirement scheme in the Government Offices with a further £8.4 million in non-cash provision for early retirements, which reflects future costs of early retirements in 2006-07. The Department says this explains why its Administration expenditure rose by 15 per cent in 2006-07, from £130 million to £150 million. This is also placing pressure on the Department target of making £25 million savings on Administration by the Gershon deadline. Savings in this area reported to the end of 2006 were just £6.8 million, less than a third of those needed in total.

Resource Accounts

41. The Department's Resource Accounts were laid before Parliament on 12 July, thus meeting the Whitehall-wide deadline to lay accounts before the summer recess. CLG's accounts received a clean audit certificate from the Comptroller and Auditor General. As the Department was created on 5 May 2006, the comparative figures for the previous financial year have been restated, as required by accounting standards. Despite this, some figures cannot be compared directly owing to changes in the new Department's responsibilities. The format of the Resource Accounts has also changed, and now includes a separate remuneration report before the main accounts which discloses the salary and pension costs of the Ministers and senior civil servants in the Department, information also given in Chapter 10 of the Annual Report. Additional information includes details of the organisational and operational structure of the Department and the risk management and internal control policies in place. The Resource Accounts also include similar information to the Annual Report, such as an analysis of the Department's strategic objectives and the PSA targets against which progress is measured.

Progress since last year

42. During our last Annual Report inquiry we identified a number of Parliamentary Questions on which the Department had provided limited answers on the grounds that it had been created in May 2006 and had no information on its predecessor Department, the ODPM. We are glad to note that new guidance to civil servants on answering such questions, issued by the then Secretary of State, as a result of our inquiry, appears to have solved that problem: full answers have since been given to questions relating to the period before May 2006.[60]

43. We also rejected the memorandum provided by the Department in advance of the Winter Estimates Day debate on the floor of the House, arguing that it was confused and unclear.[61] We are glad to note that the Department responded with a new and improved memorandum and that officials have worked hard to meet the requirements of the Committee and the Scrutiny Unit to provide substantially clearer information this year. None the less, room for improvement remains. For example, a number of items listed under "Changes sought which do not increase public expenditure taken across government" have no monetary value attributed to them, making it unclear how they interact with figures given in the summary of net charges given in an associated table. We intend to draw further detailed points to the Department's attention in correspondence. Our adverse comments on the Department's provision last year of full and clear information to Parliament and the public have led to significant improvement in its provision of information, particularly in the answering of Parliamentary Questions, the clarity and detail of the Annual Report, and the much more informative estimates memoranda provided to Members of Parliament. We urge the Department to continue to seek and implement such welcome improvements.

44. We also commented in each of the past two years on a small but persistent and significant incidence of bullying, harassment and discrimination within the former ODPM and its successor, CLG. In response, the Department has taken substantial steps to identify and resolve the problem, including the provision of "dignity and respect" and "coaching" courses for its senior managers and the introduction of quarterly staff surveys to track progress in reducing the number of staff who feel bullied, harassed or discriminated against. This work clearly demonstrates a will and considerable effort on the part of senior management to tackle the problem. The quarterly surveys have also demonstrated that staff morale in CLG is significantly higher than it was in ODPM: some 70 per cent of CLG staff surveyed in the second quarter of 2007 agreed that "morale is good within my team", compared with just over 40 per cent of ODPM staff surveyed in 2005.[62]

45. What the Department has not achieved, however, is a specific reduction in the number of staff feeling bullied, harassed or discriminated against. The 2005 ODPM survey reported that 10 per cent of staff felt they had been bullied, 8 per cent had experienced discrimination and 6 per cent had reported harassment.[63] In a letter to our Chair outlining the results of the second quarterly survey of CLG staff in October this year (which cost £37,000 plus VAT) the Permanent Secretary, Mr Housden, noted that

we asked five specific questions on bullying and harassment along the lines of the ODPM 2005 survey. Ipsos MORI who conduct the survey on our behalf say their judgment is that employees' attitudes on these questions remain broadly in line with those of two years ago.[64]

46. When questioned, Mr Housden accepted that the figures had not improved, but qualified that by pointing out that they are neither high nor substantially out of line with benchmark figures across other Government Departments.[65] The Department intends to continue monitoring the situation through its quarterly surveys, and this should also allow officials to see whether reports of bullying, harassment or discrimination are localised within particular teams or sections. Steps, such as the introduction of open-plan offices, have been taken within the headquarters building, Eland House in central London, to make senior managers, including the Permanent Secretary and the Directors-General, more visible and approachable, and various fora have been created to allow staff to make their views known (an intranet forum, for example, and a dedicated helpline for staff with complaints). We remain concerned about the perceived existence of bullying, harassment and discrimination. Two years of work has brought no appreciable improvement, in spite of the time and money spent on courses and the clear desire of senior managers in the Department to solve a chronic problem. Nor can the Department or the Permanent Secretary be complacent on the grounds that other Departments perform just as badly. We recommend that CLG review the effectiveness and value for money of its actions over the past two years with a view to refocusing its efforts.



55   HC 106 (2006-07), para. 14 Back

56   HC 106 (2006-07), para. 18 Back

57   Ev 39 Back

58   Cm 7094 (2006-07), p. 104 Back

59   Cm 7094 (2006-07), p. 106 Back

60   HC 106 (2006-07), para. 13 Back

61   HC 106 (2006-07), para. 9 Back

62   Ev 78 Back

63   HC 106 (2006-07), para. 27 Back

64   HC Deb, 29 November 2007, col. 681W; and Ev 66 Back

65   Q 92, Ev 12 and 13 Back


 
previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2008
Prepared 3 January 2008