Memorandum from Director General, Government Equalities Office (GEO 01)

 

Government Equalities Office Annual Report and Resource Accounts 2007-08

Thank you for your letter of 8 October seeking further information on a number of areas arising from the GEO's Annual Report and Resource Accounts for 2007-08. Your letter has raised important issues that will be helpful to us going forward and would be very happy to meet to talk through this response and answer any further questions you might have. I am pleased to provide the Committee with further information as follows.

PSA Targets

1. What is the date when final data will be available for PSA 9 of CSR 04? How will the GEO be reporting the final progress against the PSA?

 

We will shortly have data for each of the four key indicators (1-4) which must be met in order for PSA9 to be met. A final assessment of progress in delivering this PSA will therefore be made in the Department's Autumn Performance Report which we are aiming to send you next month.

 

 

 

2. A number of indicators for the Gender PSA were recorded as "not yet assessed" in the 2007 DCLG DAR (childcare provision, equal pay reviews, ITEC jobs, increase take-up of formal childcare in unemployed households and pensions). What changes were made to the method of assessment of, or information has become available on, each indicator which has enabled the GEO to assess progress; and how has that change or additional information led to the assessment recorded in the GEO's Annual Report, in each case?

 

On indicator 3 (Equal pay reviews), the baseline was set following a survey undertaken by the Equal Opportunities Commission which found that 18% of large organisations had undertaken an equal pay review. Their 2005 report found this had risen to 34%. Our assessment of 'Slippage' was based on the level of improvement which would have been required to meet the target of 45%. Recent research from the new Equality & Human Rights Commission found that 32% of organisations with 500 employees or more have undertaken an equal pay review and this target has not therefore been met.

 

There are difficulties with measuring progress on indicator 4(iii), which relates to women's representation in Information, Technology, Electronics and Communications (ITEC) jobs. As set out in the technical note for the PSA, the aim here was both to 'reverse the serious under-representation of women in ITEC jobs' and to 'bring their share up to the level of our competitors'. The latter aim has proved problematic because differences in data collection methods and classifications make it difficult to compare our progress with other countries. We therefore agreed with the Treasury earlier this year that the final assessment would relate only to the representation of women in ITEC jobs domestically, where we would seek any measurable increase over the spending review period. We are still awaiting data to inform a final assessment but the evidence to date shows a decline in the proportion of women in ITEC jobs from 23% in 2002 to 19% in 2006, we therefore assessed progress on this indicator in our report as 'Slippage'.

 

 

Indicators 8 (i) and (ii) both relate to childcare provision:

8 (i) focuses on increasing the number of registered childcare places. Progress is measured against a March 2004 baseline of 1,103,000 Ofsted registered childcare places in England. The aim was to increase the stock of childcare by 10 per cent, giving a target of 1,213,000 registered places. At March 2008, the stock of registered childcare stood at over 1.29 million places and our target has therefore been 'Met'.

8 (ii) focuses on increasing by 50% the take-up of formal childcare by lower income families. We will receive final data in 2009, but a Department for Children, Schools and Families survey found that, for 2007, the proportion of children in lower income working families receiving formal childcare in the last years had only increased slightly - from 26% in 2004 to 27% in 2007. We therefore made an assessment of 'Slippage'.

 

Indicator 10 sought to increase the coverage of second tier pensions for women from a baseline of 53.5% in 2001/02. The original data source has been revised to use more appropriate data on take-up of second tier pension provision derived from National Insurance record. The proportion of women with second tier pensions has risen to 69.6% in 2005/6 and our assessment was therefore that this target was 'On Course'.

 

 

3. Indicator 4(ii) has been assessed as "Slippage" following a previous assessment as "On Course". Could you provide the Committee with your reasons for such an assessment?

 

This indicator relates to the proportion of newly self-employed people who are women. The baseline was 32.4% and our aim was a statistically significant improvement over the spending review period. Although proportion of newly self-employed people who were women rose to 37.5% in 2005/6, this subsequently fell back to 34% in 2006/7. Our assessment of 'Slippage' reflected this dip in performance. Final figures for 2007-8 will be available shortly.

 

 

4. Indicators 6, 7(i) and 7(ii) all reflect the involvement of women in public service. All three show slippage. What are the latest percentage figures for these three indicators? How have they moved over the PSA period? Could you provide the Committee with a breakdown of these indicators by department and show which have been most successful in meeting these targets and which least successful?

 

Indicator 6 relates to female appointees to public bodies, where our aim was for a clear majority of Departments to have over 40% of women in public appointments for which they are responsible. The baseline was set in 2002 when around a quarter (6) of all Departments met this standard. We are awaiting final data, but the published figures for 2007 show a deterioration and only one Department (Home Office) had over 40% of women in public appointments - this is despite a small increase overall in the proportion of public appointments that are held by women. The table at Annex A shows the performance of individual Departments in 2006/7 in a league-table format, although precise like-for-like comparisons are difficult because of the variation between sectors and bodies in terms of women's representation.

 

Indicators 7(i) and 7(ii) relate to women in the Civil Service. Again, we are awaiting final data but the latest position at the time of writing is as follows. Please note that we do not hold information about the performance of individual Departments.

 

Indicator 7 (i) targeted the proportion of Senior Civil Service (SCS) posts held by women and sought to increase this to 37 per cent. The baseline was 26.4% in 2003. As at October 2007, 32.1% posts were filled by women.

 

Indicator 7 (ii) targeted the proportion of SCS top management posts held by women and sought to increase this to 30 per cent. The baseline was 22.9% in 2003. As at October 2007 women filled 26.6% of top management posts.

 

 

 

5. What strategy does the GEO have in place to influence other departments towards meeting targets for indicators 6 and 7?

 

Diversity in both public appointments and the Civil Service remain a priority for Government. In July 2008, Harriet Harman and Ed Miliband announced a package of measures to improve the diversity of public appointments, including the intention to set new targets. In October, the remit of the Commissioner for Public Appointments, Janet Gaymer, was widened to include an explicit objective on improving diversity. We expect Ministers to make a further announcement on public appointments, including the level at which new targets will be set shortly. Also in July, the Cabinet Office published "Promoting Equality, Valuing Diversity: A Strategy for the Civil Service", which set out new commitments from the Government to promote equality and diversity across its workforce. This builds on the first Civil Service strategy to improve diversity and the Gender Equality PSA target.

 

 

Comprehensive Spending Review 2007 and New PSAs

 

6. The previous PSA had data quality issues, with data systems assessed as poor. Please provide the Committee with further information on how you are intending to address these data issues with respect to the equalities PSA.

 

The NAO were critical of the data systems underlying PSA9, primarily because the diffuse multiple indicators did not collectively give a clear picture of performance. In addition, some indicators were not easily measurable, either because the data was not accessible or because success was not clearly defined.

 

We have taken a number of steps to address these issues in designing CSR07 PSA15. In particular, we have ensured the new PSA indicators are:

Outcome-focused, for example targeting a reduction in the gender pay gap rather than the number of large organisations that have undertaken equal pay reviews

 

Broader-based, targeting issues which affect large numbers of people

 

More focused, relying on a smaller number of key indicators and

 

Much more robust in relation to accessibility and frequency of data - four of the five indicators are drawn from national statistics, with the remaining indicator being measured via the monthly Omnibus Survey conducted by the Office for National Statistics (ONS).

 

 

7. The PSA 15 Delivery Agreement states that the "Minimum movement required for performance assessment" is 0.7 percentage points. Does this figure represent the minimum percentage which can be interpreted as a statistically significant change, or the percentage reduction for this target to have been "Met"?" Is the target to reduce this figure from 12.6% to 11.9% over the CSR period? If not, what level would the indicator need to reach for the target to be considered "Met"?

 

As appropriate for a PSA which seeks to address deep-rooted problems which have a long history, there are no numerical targets set for any of the indicators for this PSA; instead, we are seeking an improvement over the spending review period. Where we refer to a minimum change required, this relates to statistical significance. The annual ONS figures on the pay gap will be published on 14 November.

 

 

8. Indicators 2 to 5 do not appear to have figures for their baselines nor distinct targets. This appears to be due to data lag from surveys. When will these surveys be published? When the surveys have been published and the baselines and targets set, the Committee would like to be provided with copies of this information.

 

Indicator 2 uses new questions in the ONS Omnibus Survey, which is conducted on a monthly basis. The results are not published but we should be happy to share the data with you, if you would find that helpful. We expect to set a baseline in January 2009 when we will have sufficient data from this survey to ensure its robustness.

 

Indicators 3, 4 and 5 are measured responses to questions in the Citizenship Survey, the findings from which are published quarterly as national statistics.

 

For Indicator 3, the baseline year is 2007-08 for which data was released in June 2008. A baseline will be set once work has been completed work to develop a robust methodology for measuring the indicator.

 

For Indicator 4, a baseline cannot be set until Summer 2009 when we will have two quarters worth of data from the 2008/9 Citizenship Survey, as the 2007/8 survey did not ask about disability-related discrimination.

 

For indicator 5, a baseline has been set as 0.2% for 2007-08; however, the finding that there are no significant gaps between groups in perceptions of unfair treatment conflicts with other evidence on this issue. The GEO is now taking forward a research project to examine the theoretical concepts, data and thinking associated with perceptions of unfair treatment, and to develop and test a better approach to measurement.

 

Efficiency programme and Value for Money

9. The Annual Report and Resource Accounts makes no mention of either the SR04 Efficiency Programme or the CSR07 Value for Money programme. What elements of the SRO4 Efficiency Programme did GEO inherit from CLG if any? What agreements on efficiency and value for money measures have been made between GEO and HM Treasury for the CSRO7 period? Has the GEO produced a VFM Delivery Agreement? If so, please could you provide the Committee with a copy and outline what actions you are taking to implement that agreement?

GEO, as a new Department, is currently drawing up its efficiency plans for the last two years of the CSR07 period. At present there is no formal efficiency or VFM delivery agreement between GEO and HM Treasury for the CSR07 period. This is because GEO was not a separate Department in accounting terms when the CSR07 settlement for CLG was agreed. We do however work closely with HM Treasury on all public expenditure and accounting issues and are committed to securing VFM in all that we do.

GEO did not inherit any elements of CLG's SR04 efficiency programme. The former Women and Equality Unit and other equalities functions now in GEO were transferred into CLG in May 2006 and out of CLG in June 2007. The WEU was located in the former DTI at the beginning of the SR04 period.

We will be happy to keep the Committee informed of our plans as they develop, and apologise that our Annual Report did not make these points clearer.


Core and other financial information


10. On page 28 you state that "the categories used in these tables are the strategic priorities" yet the categories used in the Core Tables do not appear to correspond to the DSO on page 9 but to be mainly based on the spending body. What "strategic priorities" do the core tables and the estimates use? How do these "strategic priorities" relate to the Departmental Strategic Objective?

I apologize that the Note on page 28 is misleading. Core Table No1 shows the breakdown of budget by Departmental Strategic Objective. Core Tables No 2 and No 3 do not show breakdown by Strategic Priority rather they show breakdown in line with the GEO's Estimate :-

Administration;

Equality policy and the Women's National Commission

European Year of Equal Opportunity for All

Non Departmental Public Bodies

This breakdown had been agreed with HM Treasury. Additionally we have separated the NDPB information into the separate bodies in line with previous requests from the Committee.

Equality and Human Rights Commission

Commission for Racial Equality

Disability Rights Commission

Equal Opportunities Commission


11. In Core Table 1 (p.29) the resource budget for the GEO as a whole shows a significant increase from 2006-07 to 2007-08 with a corresponding reduction in 2008-09 of over 10k. What is the reason for the significantly higher spend in 2007-08? How much is due to one-off costs from becoming an independent body and what have these transition costs been spent on?

The overall increase to the GEO budget for 2007-8 in comparison to other years is due to the initial start up costs for the Equality and Human Rights Commission in 2007-8. Costs were incurred on establishing a project team and project managing the establishment of the new Commission including estates evaluations and initial due diligence assessments and organisational design.

12. Core Table 1 (p.29) shows the Capital Budget of GEO increasing significantly to around 7m for the years 2007-08 to 2010-11. There is however no corresponding increase in depreciation. The 7m shows against EHRC in Table 3 but there is no figure for Capital Employed in EHRC in Table 4. Can you confirm what this capital budget is being used for and why there are no figures for Capital Employed by EHRC in Table 4, given both the capital budget and the footnote that states "includes in 2007-08 all assets and liabilities transferred from the legacy commission EOC, DRC and CRE"?

The GEO has a capital budget of 7m for 2007-8 onwards all of which resides with the Equality and Human Rights Commission. The Commission tells us it will have spent close to 7m in 2007-8 (we await the EHRC's resource accounts to confirm this). The Commission currently plans to spend only 2m in future years and GEO is in discussion with the Treasury and other Government Departments with a view to exchanging the capital budget for resource.

The depreciation figure will increase but until the Commission has finished its Accounts for 2007-8 and established a fixed asset valuation it is not possible to provide an updated depreciation figure.

When the Equality and Human Rights Commission has submitted certified Accounts then the Core Table 4 will be updated with the net assets of the Commission. However until then, it is not possible to provide an estimate of the Commission's net assets so the footnote is premature and was prepared in anticipation of including a figure based on the Commission's accounts.


13. In Core Table 2 (p.30) the resource budget for "Equality policy and Women's National Commission" is significantly lower in 2007-08 than for any other year. What is the reason for the low level of spending in this area in 2007-08?

The low level spending figure in 2007-8 is deceptive as the spending on equalities is masked by two factors -

Income of 700k in 2007-8 only. This is a contribution from the Department for Transport to the Government Equalities Office in relation to Transport Disability regulations.

Transition costs for the Equality and Human Rights Commission in 2004-5, 2005-6 and 2006-7.

The table below shows how the Equality Policy and Women's National Commission expenditure line is broken down in detail.

 

 

 

 

 


There was an EHRC transition team in place within DTI from 2005 that worked on preparation for the establishment of the new Commission. Underlying spending on equality policy and the Women's National Commission has remained largely unchanged since 2002-3.


14. The Operating Cost Statement shows total administration costs of 5.2m along with direct programme spend of 1.8m. Why are the department's administration costs so high compared to the level of programme spend? How does the department see this ratio changing over the first few years of GEO's existence?

There are a number of reasons why our administration costs are high compared to our programme spend, these are outlined below:-

the core role of the Department is one of strategic policy advice to Ministers, equality policy development including the Equality Bill and co-ordination of equality policy and strategy across government and support for the Minister for Women and her priorities. We were not established to run grant regimes or incur significant amounts of programme expenditure outside our grant in aid to the Equality and Human Rights Commission;

only a very small proportion of GEO's staff activity is related to programme spend. Less than 4% of staff works on the monitoring of the Equality and Human Rights Commission and the Women's National Commission who account for nearly 71m of programme expenditure in each of the plan years.

as a small stand alone department supporting four Ministers, we have press office and communications needs more akin to a larger department.

Our departmental status requires GEO to comply with all the same central initiatives and requirements as large departments. As a result GEO has a higher per capita central overhead.

GEO has a very high legal overhead in comparison with other government departments. Some 1.5m of our administration costs are incurred as payment for Treasury Solicitors who support the development of the Equality Bill.

Outside our Non Departmental Public Body sponsorship, the remaining programme spend is either one off projects such as the funding of Rape Crisis Centres and the National Equality Panel or on longer term research projects where GEO staff involvement is low.

15. Note 8(a) of the resource accounts shows wages and salaries for permanent UK staff was 3.lm in 2007/08. Note 8(b) shows the number of permanent staff as 62. This equates to an average salary of 51k. This is a relatively high figure (The DCLG equivalent is 34k). Why is the average salary at GEO so high? Is the make-up of staff weighted towards higher grades? If so, what effect does this make-up of staff have on GEO's activities?

The 3.1m figure include salaries for 5 staff with full permanent contracts who work for the Women's National Commission and have not been included in the 62 GEO staff figure. Including these staff gives an average of 46k, which is higher than CLG's 34k and reflects the high policy and strategic content of the GEO's work and the lack of basic processing and administrative roles (which are mainly outsourced to Other Departments).

16. Core Table 6 (p.133) shows staff figures at an actual level of 70 in 2007-08 and a planned increase to 115 in 2008-09. The pay bill in Table 5 is expected to decrease by 13% against an increase of staff figures by 64%. Why is the department forecasting a drop in pay bill when the number of staff is forecast to increase by such a large amount?

The Government Equalities Office financial position for 2008-9 onwards has been stabilised following agreement to a swap of 4m programme expenditure for 4m administration expenditure with the Department for Work and Pensions. The Committee has recognised the disparity between our staffing plans and our pay resources and this swap will address this problem by providing a further 4m for administration expenditure for pay and non pay staff resources. The Table 5 figures were based on the administration budget we had been allowed before the swap.

Our new baselines, once they have been agreed by Parliament will be as follows:-

 

 

 

 

 



17. Does the GEO expect to be able to hire the large number of people it requires over this short timescale, and is it confident that in recruiting so quickly it will not have to compromise on the requisite skills? What risks are there to the business of the GEO if the desired number of people cannot be hired in the desired timeframe?

GEO has been successful to date in hiring staff and filling any vacancies. We have developed a sophisticated recruitment process which matches applicants skills and experiences to detailed job descriptions and specifications. We are pleased with the performance of those recruited thus far. We currently have 97 full time equivalent staff working in GEO and given financial constraints and the current workload do not anticipate any major recruitment in future.

Annex A

 

Appointments to the boards of public bodies as at 31 March 2007: breakdown by gender

 

DEPARTMENT

Total appointees

Total female appointees

Female appointees %

Home Office

2,746

1,194

43.5

Northern Ireland Office

156

60

38.5

Dept of Health

2,888

1,102

38.2

Dept for Work and Pensions

170

62

36.5

Dept for Constitutional Affairs

7,569

2,753

36.4

Northern Ireland Court Service

87

31

35.6

Food Standards Agency

74

26

35.1

Cabinet Office

117

40

34.2

Dept for Education and Skills

296

101

34.1

Dept for Culture, Media & Sport

626

204

32.6

Foreign & Commonwealth Office

74

22

29.7

Dept for Transport

103

28

27.2

HM Treasury

27

7

25.9

Dept for Communities & Local Government

1,524

389

25.5

HM Revenue & Customs

10

2

25

Dept of Trade and Industry

864

209

24.2

Dept for International Development

17

4

23.5

Forestry Commission

79

18

22.8

Royal Mint

11

2

18.2

Ministry of Defence

372

62

16.7

Dept for Environment, Food & Rural Affairs

962

153

15.9

Export Credits Guarantee Dept

9

0

0

TOTAL

18,781

6,469

34.4

Source: Cabinet Office

 

November 2008