Response to EFRA questions on the Defra
Department Report 2009
SEPTEMBER 2009
PSA 28 (PAGE
149 OF THE
DEPARTMENTAL REPORT)
1. Indicator 28.2 (farmland birds)
Page 149 of the Departmental Report states
that this indicator has not yet been assessed in the CSR period,
although most recently available data for the 2007 breeding
season show that there had been a small decrease in the wild breeding
bird index. What are the Department's plans for addressing the
decline of the farmland birds indicator? What is the Department's
assessment of the way particular farming practices and Defra policies
may have contributed to that decline?
Potential Reasons for the decline and summary assessment
of Defra's role
Farmland bird populations declined by around
50% between the mid-1970s and the mid-1990s due to agricultural
intensification. This included the loss of mixed farming, the
switch from spring to autumn sowing of cereal crops (and consequent
loss of overwinter stubble fields), increased use of agro-chemicals
(particularly the indirect effect of pesticides), agricultural
improvement of grasslands and the loss of field margins and hedges.
These changes have meant that farmland birds have fewer places
to nest, are less successful when they do nest and are less likely
to survive the winter.
Ornithological experts are unable to identify
with any certainty the main additional drivers behind recent declines,
with the exception of a possible disease affecting Greenfinch
populations. The Department considers it likely that there may
have been a steeper decline in the farmland bird index had we
not put in place mitigating measures such as Environmental Stewardship
(ES).
Defra's policies
Agri-environment schemes—ES and the now
closed schemes Countryside Stewardship (CSS) and Environmentally
Sensitive Areas (ESA)—form the major delivery mechanism
for increases in farmland bird populations. Currently 50,000 farmers
are under agreement with over 6m ha (over 65% of available farmland).
We have changed several aspects of ES, in response to the recent
Review of Progress (published in 2008), by including new options,
changing existing options and improving uptake of key options,
targeting and advice[3].
These should further improve ES's performance for farmland birds.
Implementation of these changes has begun and initial prescription
and option changes are already in place. The final tranche of
Review of Progress changes will be in place (subject to Commission
approval) in time for the Environmental Stewardship Entry Level
Scheme (ELS) renewals exercise from August 2010 onwards.
In addition to the agri-environment schemes
we work closely with our delivery body Natural England (NE) and
with other stakeholders on other projects including:
Regional farmland bird initiatives
NE, in partnership with others, such as RSPB
and the Farming and Wildlife Advisory Group (FWAG), is developing
a number of regional farmland bird initiatives to increase uptake
of the valuable in-field options that benefit farmland birds via
ES.
Farmers and land managers applying for ES will
receive tailored advice delivered through workshops and one-to-one
farm visits to support the needs of these farmland bird species.
Farmers have responded enthusiastically to these initiatives.
Enhanced training and information for farmers
The Department, with NE, is developing the Entry
Level Stewardship Training and Information Programme (ETIP). ETIP
will help farmers in all regions of England to put in place the
right package of management options for their land, including
those for farmland bird species.
The Campaign for the Farmed Environment
The Campaign for the Farmed Environment is a
farming industry-led voluntary approach to recapture the environmental
benefits of set-aside that the Government has agreed with the
National Farmers Union, the Country Land and Business Association,
and other partners including RSPB, FWAG and the Game and Wildlife
Conservation Trust. The Campaign will encourage the uptake of
the most valuable options within ES and under the Campaign, by
June 2012, farmers will;
— double the uptake of these key ELS in-field
options, covering 40,000 hectares on top of current levels;
— increase uncropped land by 20,000 hectares
from January 2008 levels. The Campaign will also seek to
improve the environmental management of at least 60,000 hectares
of uncropped land; and
— introduce voluntary measures of benefit
to the environment on other land covering from at least 30,000 to
50,000 hectares.
Path to recovery from the decline in the index
Based on our current knowledge and plans there
is a reasonable likelihood that the target will be back on course
in three to five years' time. This will be dependent on: continued
high uptake of ES among farmers and land managers (aided by enhanced
training and an information package on options and coverage of
ES and changes to it), the successful implementation of ES changes
and better targeting of Stewardship agreements, and the effectiveness
of measures to mitigate the loss of set-aside through the Campaign
for the Farmed Environment. Where appropriate measures have been
put in place through ES, farmland bird populations have responded
positively. An example of this is at the RSPB's Hope Farm in Cambridgeshire
where farmland bird numbers have doubled since 2000, mainly due
to land management undertaken through ELS. This indicates that
improved use of existing measures through scheme targeting, advice,
and correct location of scheme options, can deliver a recovery
for farmland birds (as already demonstrated with the Stone Curlew
and Cirl Bunting in the predecessor Countryside Stewardship Scheme).
Additionally we have a continuing programme
of scheme evaluation and Research & Development to help refine
existing measures further and recommend new scheme options as
necessary. We believe this will help us get back on course to
meet the target by 2020.
2. Indicator 28.4 (marine health)
The Delivery Agreement for PSA 28 notes that
this indicator would be assessed by, amongst other things, the
"plankton status". Page 150 of the Departmental
Report states that indicator 28.4 has not yet been assessed,
but that 2007 data indicates that plankton have declined,
"largely due to climate change impacts". What measures
are available to the Department, specifically, to address the
apparent deterioration in plankton status?
Defra's scientific knowledge is limited about
the extent to which anthropogenic climate change is driving the
apparent changes in zooplankton. However, the changes in zooplankton
affect a large area of the North Atlantic and do appear to be
linked to changes in climate and, in particular, changes in the
North Atlantic Oscillation, which is the key control in the climate
of the North Atlantic Ocean. Nevertheless Defra's science programme
aims to improve our understanding of the implications of climate
change and ocean acidification in the marine ecosystem, including
for fish productivity, which will allow the development of potential
adaptation strategies.
The Government is actively pursuing policies
to mitigate the effects of climate change, which also aim to halt
and reverse such impacts on our oceans. However measures of the
scale needed specifically to reverse the changes reflected in
the plankton indicator (independent of climate change mitigation)
are either not available or are not likely to be feasible. Even
if such measures were available the full impacts of such interventions,
both positive and negative, are unclear.
3. Departmental Strategic Objectives (DSOs)
There have been a number of changes made to the
DSOs since they were last described in the Autumn Performance
Review—four DSOs have had their wording changed, at least
two DSOs appear to have fewer indicators, and the Department has
created an entirely new DSO (DSO 7). The Committee would like
details of all of the changes to DSOs and their underlying indicators
since the 2008 Autumn performance Report was published, along
with the rationale for each of the changes.
Details of changes to, and the rationale for,
Defra's DSOs and their underlying indicators are detailed below.
DSO 1: DSO 1 is a new DSO that puts emphasis
on the importance of the domestic Adapting to Climate Change Programme.
The lead on tackling climate change internationally has now passed
to the Department of Energy and Climate Change (DECC) since its
creation in October 2008.
DSO 3: The title of DSO 3 has changed.
In 2007-08 it was "Sustainable patterns of consumption
and production", it now reads "Sustainable, low carbon
and resource efficient patterns of consumption and production".
The change was to draw out specifically that the work of Sustainable
Consumption and Production (SCP) has a major role in minimising
carbon emissions, waste and the use of non-renewable resource.
One indicator underpinning DSO 3 has also changed. It was
"Better products, as measured by annual reductions in CO2 emissions
from domestic appliances". It has now been changed to "Better
products, as measured by progress towards meeting the Energy White
Paper target for annual reductions in CO2 emissions from
product use". This change was made to bring the indicator
more closely into line with the work that is underway to help
meet the Energy White Paper target.
DSO 4: The title of DSO 4 has changed and
one intermediate outcome and one indicator removed since the APR.
This is because responsibility for radioactive waste management
has transferred from Defra to DECC. This resulted in the loss
of one indicator. Following the creation of DECC, Defra also revised
its DSOs. As part of this, the monitoring of climate change adaptation
shifted from DSO 4 (where it was an Intermediate Outcome)
to become the new DSO 1.
DSO 6: There is one less indicator underpinning
DSO 6 than in the APR. This was the indicator relating to
food production and consumption, which now underpins DSO 7, our
new food DSO.
DSO 7: The machinery of Government changes in
October 2008 gave Defra a coordinating role in food policy
and in line with this the new DSO 7 was created. Previously
food related work was brigaded under the DSO 6 "A thriving
farming and food sector". The new role requires us to work
with other Departments on wider issues, such as social impacts
(health and wellbeing, food inequalities, food poverty, food skills)
and international activity on global food security and sustainability.
DSO 8: The EFRA Committee in its 11th Report
of Session 2007-08 (volume 1) recommended that Defra adopt
the term "Socially and Economically Sustainable Rural Communities"
for its DSO 8 to replace "Strong Rural Communities".
In our response to the report, we agreed that the suggested change
was a constructive one and accepted the recommendation.
4. DSO 1: Climate Change (Departmental Report
page 151)
The Report states that the Department plans in
Autumn 2009 to propose a basket of indicators for the Adapting
to Climate Change Programme for consultation. What is the Department's
latest thinking on the sort of measures that might be involved,
and to what extent does the Department expect such measures to
include factors which the Department itself might be able to influence?
Defra is developing this workstream with the
intention of proposing a new basket of performance measures for
adapting to climate change in Autumn 2009. These are likely to
recognise the need to raise awareness, to build capacity in the
public, private and third sectors, and to generate changes in
policy and practice to deliver real world outcomes. Adaptation
is essentially a process, rather than an outcome. Linking measures
of adaptation success to outcomes is therefore a complex undertaking
and is likely to require long timeframes for development. Furthermore,
by aiming to "mainstream" adaptation into an organisation's
common risk management processes, it will be difficult to distinguish
the influence of "adaptation" risk management from other
influences on decisions taken.
A mixture of process and outcome indicators
are likely to be in any proposals, with a particular emphasis
on process indicators in the short term, but with an intention
to shift to outcome indicators in the long term. Defra needs both
to measure the UK's adaptive status, which includes elements outside
of our control, such as private sector choices of adaptation actions,
and to have indicators that measure the effectiveness of its programmes.
5. DSO 2: Healthy Natural Environment (Departmental
Report page 153)
On indicator 2.5.2, the Annual Report notes that
a survey in 2007 found no overall change in average carbon
concentration in soils since 1978. What is the Department's current
thinking on the possible reasons for this lack of change?
The lack of change in soil carbon as reported
by the 2007 Countryside Survey is reassuring and suggests
that soils have not been subject to the levels of degradation
that were identified by a previous study in England and Wales.
More recent large-scale soil surveys, such as National Soil Inventory
Scotland, have also supported the Countryside Survey results.
However, Defra recognises that there are weaknesses with the methodology
of current soil surveys—at present they measure changes
in the concentration of soil carbon only and do not taken into
account losses due to erosion or oxidation of peat for example—and
Defra is exploring ways to improve their robustness.
Many factors can affect soil carbon concentrations
including land management practices, weather variations, climate
change impacts and nitrogen deposition, and research is ongoing
to better understand how these factors may have contributed to
the trends observed. At the same time, Defra has put in place
measures to protect existing soil carbon through Common Agricultural
Policy cross-compliance and Environmental Stewardship schemes
and is looking at further opportunities to increase soil carbon
stores. However, it will take potentially 7-10 years after
implementation before the impact of these measures can be detected
because levels of carbon in soils change very slowly.
6. DSO 3: Sustainable Consumption and Production
(Departmental Report page 155)
Four of the indicators for this DSO do not yet
have baseline data available, although the narrative indicates
that some data on "resource efficiency" and "consumption"
might be available after June 2009 (indicators 3.1.1 and
3.2.2). The Committee would like to see this data when it is available.
Please find below the data for indicators 3.1.1 and
3.1.2.
Indicator 3.1.1: Resource efficiency, is measured
by reductions in environmental impacts of manufacturing/services
against Gross Value Added. Gross Value Added in the main sectors
targeted by Sustainable Production and Consumption (SCP) policies
rose by 25% between 2000 and 2007. Water use decreased by
about 10% over the period, although because of climate variations
it is too early to say whether the change is significant. CO2 emissions
fell by 5%, while waste to landfill reduced from 27 mt to
21 mt.
DSO indicator 3.1.1: Resource Efficiency—data
for the first year of the CSR period
Data for 2007 the base year for the CSR
period is as follows:
1. Gross Value Added of SCP key sectors (UK):
£864 billion in Chain Value Measures (2005 prices).
2. Carbon dioxide emissions (UK): 182 mt.
3. Water use (E&W): 2.7 million cubic
metres.
4. Commercial and industrial waste to landfill
(England): 21.0 mt.
Indicator 3.1.2: Household consumption is measured
by reductions in environmental impacts of UK households against
household spending. Household expenditure rose by 21% between
2000 and 2007. There was little change in water use with
a small increase of 3%. CO2 emissions from energy fell 5%,
while household waste not recycled fell from 27 mt to 20 mt,
representing improvements.
DSO 3 Indicator 3.1.2: Household
Consumption—data for the first year of the CSR period
Data for 2007 (the base year for the CSR
period) is as follows:
1. Household final consumption expenditure (UK):
£815 billion in Chain Value Measures (2005 prices,
not seasonally adjusted).
2. Carbon dioxide emissions from energy use in
the home (UK): 141 mt.
3. Water use (E&W): 2.9 million cubic
metres.
4. Household waste not recycled (UK): 20.3 mt.
These data show that production is becoming
more resource efficient over time, whilst although there was little
change in water use in the home, changes in household energy use
and household waste not recycled are heading in the right direction.
7. DSO 8: Rural Communities (Departmental
Report pp 169-171)
The two indicators for this DSO have, between
them, 39 individual statistical measures. The Report states
that the Department's performance will be assessed by comparing
rural outcomes for these measures against the national average.
The Committee would nevertheless like to see any trend data available
for these measures, including if possible trend data that compares
rural outcomes against national outcomes.
The 39 statistical indicators used in the
2009 Departmental Report are supplemented by historical data
for almost all of the indicators in DSO 8 The indicators
have between two and 12 years' data in the "baseline"
(pre 2008 data) which varies depending on whether the information
has been collected or is readily available. The full report which
contains tables and charts using this trend data is available
on the Defra website.[4]
This historical data is crucial in assessing
the "traffic light" status of each indicator. The indicator
is assessed not only on the relative position of rural areas to
the national average for the most current year available but also
on the trajectory from previous years and where this suggests
the trend is heading in the future. Therefore, an indicator where
performance in rural areas is the same as the national average
but which is showing a downward trend for rural areas and an upward
trend for England would be given an amber-red rating based on
the trend rather than green rating based only on the current position
of rural areas relative to the national average.
8. DSO 9: Respected Department (Departmental
Report page 172)
The Department has not defined any intermediate
outcomes for this DSO. Instead, progress in delivering the policy
outcomes for DSOs 1-8 will be tracked in combination with
a range of internal management indicators for customer service,
stakeholder perspectives, public opinion, staff engagement and
efficiency. What data does the Department have on any of these
themes, and what do they show? When does the Department expect
that it will it be in a position to provide a progress assessment
for this DSO?
Defra's approach to DSO 9 is to monitor
progress by a suite of internal management indicators.
This reflects Defra's view that managing organisational respect
in a Whitehall context is complex. What Defra is trying to measure
is how internal organisation furthers the effort to achieve our
policy outcomes. Although these measures are internally focussed
our assessment is that Defra is respected and the DSO is being
delivered. Given the internal value of these measures and the
reality that they are at one step removed from what matters to
the public there is little value in putting these and their RAG
status into the public domain. Defra is happy to share these with
EFRA, and a copy of the progress report for the period April to
June 2009 is attached. Defra is now considering the case
for removing this DSO, whilst continuing to monitor levels of
respect by other parts of our corporate reporting process.
Please see attached DSO 9 Progress Report.
EFFICIENCY
9. CSR-07 Value for Money Target (Departmental
Report pp 135-138)
(i) Defra plans to find £115 million
of its required Value for Money savings by 2010-11 from "allocative
savings", or "reprioritisations", including £75.6 million
from such measures identified in 2008-09. What are the main areas
or activities contributing to that £75.6 million saving?
What "lower value activities" were given smaller budgets
as a result?
In setting the budget for 2008-09, Defra was
entering the first year of a new Spending Review period, with
a new set of challenges and priorities. The demand to spend money
on the full portfolio of Defra's activities outstrips the budget
available for the CSR-07 Settlement. Therefore Ministers
and the Management Board had to undertake a "reprioritisation"
exercise to make sure priorities were protected and sufficiently
resourced. For example Ministers made public commitments to improve
the speed and accuracy of Single Payment Scheme (SPS) payments
to farmers and to increase government spending on flood risk management
from £600 million in 2007-08 to £800 million
in 2010-11.
It was agreed that we could include £75.6 million
of Allocative Savings within Defra's overall VfM savings in 2008-09 (in
line with HMT and NAO guidance). This represents those areas where
we made adjustments within a programme or ongoing activity to
ensure that, within the overall budget available, higher priority
activities received due recognition and support in the budget
setting process. The table below provides a breakdown by Management
Board Programme and by Group Programme/ongoing activity of where
the £75.6 million was derived. However, it is worth
emphasising that these figures represent adjustments made to components
within the individual programmes listed. It does not therefore
mean that the programme itself is a "lower value activity".
|
| Programme | Savings 2008-09 (£k)
|
|
| Board Programmes | |
| Sustainable Production and Consumption |
13,925 |
| Rural Development Programme for England |
9,800 |
| Water Availability and Quality | 8,500
|
| Marine | 3,500 |
| Animal Health and Welfare | 3,000
|
| Farming for the Future | 750
|
| Waste | 250 |
| Group Programmes and Ongoing Activities
| |
| Animal Health Agency | 8,750
|
| People and Landscapes Programme | 6,000
|
| Sustainable Development Programme | 4,500
|
| Defra Strategy Programme | 3,550
|
| Counterfactual Savings Programme Element1 |
900 |
| Food Chain Programme | 500 |
| Capital Savings | |
| IT Infrastructure | 6,860 |
| Delivery Body Asset Base | 3,565
|
| Marine | 550 |
| Core Defra Estate | 440 |
| Counterfactual Savings Capital Element1 |
310 |
| Total Allocative Savings | 75,650
|
|
| Note 1: The "counterfactual" element represents the inflationary increase to the cost of the activities for which the savings have been made had the activities continued without the savings. This is the agreed HMT methodology for calculating VfM savings.
|
| |
(ii) At page 137, the Defra Annual Report states
that the NAO will review Value for Money savings and "report
on each Department's claim during the CSR-07 spending period".
When is the NAO's report on Defra's programme expected to be produced,
and will such a report be made publicly available?
Defra was one of three government departments that volunteered
to become involved in a pilot study of VfM savings by the NAO
in late 2008 and early 2009. This helped NAO to devise clear
criteria for measuring VfM savings which they are now using to
undertake VfM reviews of all government departments over the CSR-07 period.
This can be found on their website.[5]
Due to Defra's participation in the pilot study, and our relatively
small level of savings compared to other departments, NAO do not
expect to return to Defra for an audit review until the Summer
2010 at the earliest; as with all NAO VfM reports we would
expect this to be published.
(iii) Defra's Value for Money target was increased
by £75 million in Budget 2009. What savings measures
does the Department expect to pursue to achieve the additional
£75 million required?
Defra has identified scope to deliver £75 million
more efficiency savings. The savings will be mainly delivered
by deploying opportunities identified in Defra's back office and
IT functions, through collaborative procurement, better asset
management and rationalisation of the Department's estates under
the Operational Efficiency Programme (OEP). Initiatives include
the following.
Sustainable Workplace Management (SWM) brings much of the
Defra network estate into a single Facilities Management contract
realising economies of scale and increasing the flexibility and
quality of Defra's facilities. The contract will save Defra £6 million
each year from 2010-11 onwards and over its life time it
will achieve sustainable savings of £126 million.
Adopting a more risk-based approach to monitoring and enforcement
and sharing costs with industry will save an additional £17 million
on BSE and scrapie measures. The Animal Health Agency will save
£7 million through modernised working practices supported
by IT-enabled process change.
Creation of the Food and Environment Research Agency (FERA)
will reduce overhead costs by £2.5 million through the
merger of the Central Science Laboratory, the Government Decontamination
Service and Defra's Plant Health Service and Plant Variety Rights
and Seeds Office.
Defra's waste management and resource efficiency activities
will be delivered through a single delivery channel, the Waste
and Resources Action Programme (WRAP), saving £3 million.
Further work is currently underway to validate and devise
a delivery plan for the remaining £40 million VfM savings,
building upon work already launched as part of the OEP programme.
10. Operational Efficiency Programme
(i) The Committee would like detail of all programmes
and expected savings under Defra's Operational Efficiency Programme
banner.
Defra's OEP can be outlined as follows. First a benchmarking
phase this autumn, using HMT key performance indicators. Secondly
functional reviews informed by the results of benchmarking and
steers from Defra's respective Heads of Profession followed by
implementation of review findings. Until the reviews are completed
it is difficult to say what VfM savings will emerge under the
OEP banner. However, we are aspiring to achieve 20% to 25% savings
in our back office costs by 2013-14 compared to 2007-08.
Defra is also aiming to improve procurement performance by collaborating
much more than previously to secure greater VfM. Defra also plans
to improve the value that we achieve via the management
of our assets.
(ii) Page 40 of the Departmental Report notes
that British Waterways will establish a wholly owned property
subsidiary. Please can you provide details of any progress made
in setting up the subsidiary? What savings are envisaged, and
in what years?
Discussions have been taking place between British Waterways
(BW), Defra, HMT and the Shareholder Executive on setting up the
property subsidiary. Progress will have been made and reported
on in the Autumn Budget statement. The new structure will increase
clarity of BW funding model and help ensure BW's continued focus
on maximising returns from their property portfolio. More broadly
Defra's OEP will look at the possibility of VfM savings from both
asset management and efficiency, looking beyond the current CSR-07 period
to 2013-14. BW will be part of this work as we endeavour to increase
the VfM savings that we are making. Defra aims to complete the
work by the end of 2009.
11. Lyons Efficiency Target (Departmental Report page
138)
The Department states that the current overall forecast for
the relocation of posts out of the South-East by March 2010 stands
at 776 posts, which would significantly exceed the Department's
original target. This includes 223 Agriculture and Horticulture
Development Board posts relocated to Warwickshire and 140 posts
for the Marine Management Organisation to be established in Tyneside.
How many redundancies might be involved in these two moves, and
what might the total extent of redundancy payments be?
The Agriculture and Horticulture Development Board (AHDB)
relocation to Stoneleigh was completed in July 2009. The following
table shows the number of redundancies made as a result of relocation
and the latest cost estimates.
| |
| |
Previous Organisation |
Location
|
Redundancies | Redundancy
Cost (£k)
|
| |
| |
| AHDB Meat Services | Milton Keynes
| 46 | 1,535 |
| Home Grown Cereals Authority | London
| 38 | 1,095 |
| Potato Council Ltd | Oxford
| 24 | 780 |
| Horticultural Development Council | Kent
| 10 | 380 |
| Meat and Livestock Comission Commercial Services Ltd
| Milton Keynes | 3 | 65
|
| Totals | | 121
| 3,855 |
| |
| |
| |
| |
The relocation of the Marine and Fisheries Agency to Tyneside
and its transition to the Marine Management Organisation involves
no redundancies.
DEPARTMENTAL REPORT:
OTHER ISSUES
12. Better regulation
Page 130 of the Annual Report notes that the administrative
burden imposed by the Department was £460 million, and
that this will be reduced by £56 million through already-identified
better regulation measures. What are the main measures involved?
The latest available version of the Defra Simplification
Plan is that for 2008, which is available on the Defra website.[6]
A list of all the main simplification measures, grouped by theme,
can be found in Annexes A and B, with lower-value measures in
Annex C. Please note that the list includes measures for Radioactive
Substances, which have since been transferred to DECC. Work has
begun on the 2009 Defra Simplification Plan, which will be
available by the end of the year.
13. Capability Review, March 2009
The Committee would like to have a copy of the Department's
action plan for addressing the recommendations of the March 2009 follow-on
Capability Review, or if no new action plan was produced then
details of how the recommendations of the March 2009 Review
will be taken forward.
The action plan has been discussed with the Cabinet Office
and agreed by the Defra Management Board. It shows how the recommendations
of the Capability review are being taken forward as four workstreams:
1. Delivering for our customers.
2. Building confidence and pride.
4. Embedding our business processes.
Each workstream has been assigned a Senior Responsible Officer
(SRO) and the underpinning activities needed to ensure delivery
have been set out. Progress against the action plan will be monitored
on a quarterly basis by the Defra Management Board as part of
the Corporate Dashboard. The Action Plan has been published on
the Defra intranet.
Please find attached a copy of the Capability Review Action
Plan which was published on 3 July 2009.
14. Core Expenditure Tables (Departmental Report pages
208-233)
(i) Table 1 in the core tables (page 219) shows
that Resource DEL allocated to the "Less Waste" programme
within the Sustainable Consumption and Production DSO is expected
to decline greatly from an outturn of £216 million in
2007-08 to £59 million in 2008-09. The Department,
on page 216, attributes this to the ending of the Business Resource
and Efficiency Waste (BREW) programme in 2008-09. BREW returned
£284 million to business raised from the landfill tax
escalator over 2005-08 (Defra website: Historic arrangements;
the BREW programme). If that process had continued, how much would
have been returned in 2008-09 and 2009-10? How would such
2008-09 and 2009-10 figures have compared with the Department's
actual expenditure on similar business resource efficiency programmes?
Landfill Tax was designed to be revenue neutral. The BREW
Programme was one way in which revenue was returned to businesses
and was time limited to the period 2005-08. Revenue was also returned
through a 0.2 percentage point reduction in employers' national
insurance contributions and the reductions in corporation tax
announced in Budget 2007.
It is therefore not appropriate to calculate a hypothetical
level of spending on BREW in 2008-09 or 2009-10, since this
would require assumptions to be made about the overall distribution
of revenue from the Landfill Tax. Funding for business resource
efficiency and waste activity, previously under the BREW Programme,
is now integrated with the wider range of Defra funding used in
support of carbon reduction, waste reduction and recycling and
resource efficiency.
(ii) Defra is bringing together a range of bodies
under the leadership of WRAP (Waste and Resources Action Programme)
to rationalise business resource efficiency work. How does WRAP's
2009-10 budget compare with the overall BREW budget for its
final year (2007-08)?
The different forms of support currently provided by separate
resource efficiency delivery bodies sponsored by Defra will from
2010 onwards be procured or provided in one form or another
by WRAP. Defra's grant offer to WRAP in 2009-10 is £56.6 million,
which covers both its own work and the activities of the other
delivery bodies. Defra's grant offer to WRAP in 2007-08 was
£61.8 million, of which £13.7m was from BREW Programme
funding. The overall BREW budget for 2007-08 was £122 million,
with £25.3 million provided for other resource efficiency
and waste activities.
15. Core Expenditure Tables (Departmental Report pages
208-233)
Table 1 of the Departmental Report "core tables"
also shows that the Resource DEL budget allocated to "Strong
Rural Communities" is forecast to be particularly low in
2008-09 (£49 million), because of a reduction in
Regional Development Agency spending "due to an agreement
with HM Treasury". To what extent does this represent a reduction
in government spending in rural areas? What did the agreement
with the Treasury involve?
Among other budget balancing measures the Department sought
and secured agreement from HMT to reduce funding to the Regional
Development Agencies (RDAs) as a necessary measure to set a balanced
budget and to protect its priorities for 2008-09. Defra's contribution
to the RDA's single pot in 2008-09 was reduced by £20 million
as a one-off exceptional measure. The agreement with HMT was on
the condition that Defra reinstated its contribution to the RDAs
for 2009-10 and 2010-11 in line with the original CSR-07 settlement.
Performance management of RDAs by Defra is fairly arms length
due to the way RDAs are funded. Contributions from seven departments
go into a single pot which is then allocated to regions by the
Department for Business Innovation & Skills. It is then up
to RDAs how they spend these funds within their region. Due to
this single pot arrangement Defra is not able to assess exactly
how much the 2008-09 reduction affected rural spending.
16. Rural Payments Agency
(i) The RPA's 2008-09 Annual Report & Accounts
notes that it has started a major programme of updating all mapping
information in the Rural Land Register to support the Single Payment
Scheme and other subsidy schemes, in response to previous European
Commission disallowance action [HC 606, pp 7, 19]. How is this
exercise being conducted? To what extent does the exercise rely
on physical site visits or satellite imagery, and what assistance
and guidance has been provided to farmers?
The exercise to update the Rural Land Register (RLR) has
been conducted in a series of stages to test the concept, approach
and processes. Each stage has been reviewed and the information
shared with industry stakeholders at regular meetings in order
to shape the next stage.
The first stage was an in-depth update with one large farmer,
Co-operative Farms. Findings from this were fed into two further
activities to test the processes and approach; a face-to-face
mapping review clinic with around 40 farmers in December
2008 and a pilot involving around 1,000 farmers in three
counties in spring 2009. The balance of the new maps then started
to be sent to farmers throughout England in May after closure
of 2009 SPS application period
Each farmer involved should receive a set of maps generated
from updated base mapping information. An accompanying letter
explains what the farmer needs to do—check the maps, agree
them or let RPA know of any changes the farmer wants to make,
and emphasises the need to do this in 28 days.
To simply agree the maps, RPA has provided farmers with a
choice of response method—quick reply form to post or fax,
24hour automated phone line to call or phone number to send an
SMS message. Farmers who want to make changes to the maps return
a form and the relevant map, marked up. These changes are made
by RPA and, within around 10 to 12 weeks, the farmer
is then sent a second set of maps with the changes incorporated.
The exercise is an electronic one using base mapping information
from the Ordnance Survey 2008 mastermap as the main source.
This is supplemented by existing aerial photography to confirm
physical features. The findings from any site inspections carried
out by RPA inspectors in the normal course of its duties in the
first half of 2009 are also taken into account.
RPA has worked with stakeholder organisations and the specialist
industry publications to provide support and information on websites,
in print and at events. All farmers have received a guidance booklet
in the map pack which provides detailed help to check the maps
and complete the form to make changes. RPA's website also has
detailed questions and answers, sample publications and delivery
schedules. Phone support is available for queries with mapping
experts and farmers can set up a one-to-one appointment to get
assistance, at their convenience. Wider awareness seminars around
the country have been attended by farmers, agents and farm secretaries.
RPA has attended industry shows, events and regular livestock
auction markets to answer questions and provide assistance for
farmers.
RPA has worked with the industry bodies representing agents,
advisors and consultants to ensure those best placed to help farmers
have been briefed in detail in a series of seminars throughout
the country.
(ii) What is the state of progress with this initiative,
what timetable is being followed, and what has the work indicated
about the previous accuracy on the Register?
The intention is for map updates to be sent to around 115,000 farmers
and land managers with land held on the RLR by the end of October
with a view to including the results in pre-populated SPS 2010 applications.
The state of progress at 25/09/09 is as follows:
|
| Total |
|
| Map Packs Sent | 61,821 |
| Map Packs Returned | 40,238
|
| Accepted | 24,755 |
| Asked for changes to be made | 15,483
|
| Maps changes made and reissued | 293
|
|
| |
Early in the process around 900 farmers received maps
which had not taken account of earlier changes notified by farmers.
RPA took action to correct the problem as soon as it was identified
and has contacted all the affected farmers. Other changes that
have been made in response to customer demand to make it easier
for farmers to update their maps including reducing field parcel
number changes and including boundaries that are not permanently
marked and therefore are not visible on Ordnance Survey maps and
aerial photography.
It is difficult to draw solid conclusions as to the previous
accuracy on the Register from the recently conducted work, since
there is no direct "like for like" comparison to be
made It is expected that positional accuracy improvements made
by Ordnance Survey since 2001 will lead to a very small change
to most of the land parcels held on the register. On top of this
it is expected to capture real world changes, such as new buildings,
roads, and wooded areas, which were not on the 2001 maps,
which currently form the basis of the RLR, and which farmers have
not subsequently reported to RPA. Improvements are also being
made to what is captured on the RLR, particularly the introduction
of a separate layer identifying permanent ineligible features
for SPS, such as buildings and hard standings.
In addition there is a substantial churn each year in data
held on the register with some 4% to 5% of the 2.2 million
land parcels amended because of inspections, farmer notifications,
amendments during SPS processing and around 20-25% of SPS claimants
removing or adding land parcels.
(iii) Did the European Commission have to approve
the initiative? Will the results have to be reviewed by the European
Commission, and if so under what timetable?
RPA has an obligation under EU Regulations to regularly update
the mapping data held within the RLR. This initiative is being
carried out in order to comply with that regulatory requirement
and in response to audit findings which criticise the fact that
current mapping data is based on Ordnance Survey 2001 information.
RPA has maintained a dialogue with the European Commission to
share plans for this initiative and it is anticipated that the
outcome will be reviewed in future audits.
17. Rural Payments Agency
(i) The RPA's 2008-09 Accounts have been qualified
by the C&AG on several grounds—the way currency exchange
rate movements are accounted for, high error-rates in determining
SPS over-payment debtor balances, and disallowances [HC 606, pp41-43].
What is the nature of the "further work" that is underway
(p42) to establish the extent of the overpayments? What is being
done to reduce the future rate of overpayments to farmers?
Each case identified as potentially having an overpayment
is being reviewed back to 2005 when Single Payment Scheme
entitlements were established. As well as the underlying entitlement
position the claim data for each year is being reviewed taking
account of rule changes from year to year and the knock on effects
to other cases when entitlements have been transferred by farmers.
Priority has been given to the cases identified by November
2008 and the RPA is on track to complete assessment of those
cases by the middle of October and to inform farmers of any debt
owed. Because of the nature of the SPS, overpayments will inevitably
continue to arise, for example because inspections will identify
that farmers have less eligible area than has been claimed. Actions
have been taken, however, that should minimise the number of such
cases:
1. The update to the RLR referred to in Question 16 should
ensure that the incidences of claims based on inaccurate land
data will reduce;
2. Increased uptake of on-line application should reduce the
amount of farmer error in completion of the forms;
3. RPA now has a more stable workforce and is ensuring that
only sufficiently expert, trained, staff make amendments to claim
details and so reduce incidences of overpayments being raised
inappropriately;
4. RPA has established a framework for checking the quality
of its processing work, with team leaders checking the work of
their staff and feeding back to them quickly on any errors so
that corrective action can be taken before payment.
(ii) The C&AG's audit report notes that Defra
"is due to commission an external review of the financial
management of the Agency imminently; this will consider the capacity
and capability of the finance function within the Agency"
[HC 606, p43]. Who will be asked to undertake this review, and
with what timescale? The Committee would like to see the results
of this review when available. The Defra Resource Accounts also
refer to a review of RPA financial management [HC 453, p35]: is
this the same review?
The Committee has separately been provided with a copy of
the Defra News Release announcing the Department's intention to
carry out a 2013 review of the RPA. The review is being carried
out in the usual course of business to ensure that the RPA is
ready to react to any changes to the Common Agricultural Policy
in 2013 and will encompass not only RPA's financial management
as suggested in the C&AG's report and Defra Resource Accounts,
but also its operational activities and management capability.
The review will be chaired by Katrina Williams, Defra Director
General for Food and Farming and managed on a day to day basis
by David Lane, an independent consultant with a proven track record
of delivering this type of review within Central Government. The
bulk of the work will be carried out by externally contracted
professional services organisations that will be in a position
to provide the full range of financial, process and operational
review capability required. The review is likely to be completed
by the end of March 2010 and the Department would be happy
to share the key findings with the Committee.
DEFRA RESOURCE
ACCOUNTS 2008-09 (HC 453)
18. The Defra Resource Accounts identify exchange rate
losses of 28 million for 2008-09 on Single Payment Scheme
payments. To what extent do such losses reduce the size of the
payments to individual farmers? To what extent do such losses
reduce the overall funds available to pay farmers?
The short answer to both questions is that the exchange losses
(or gains) have no impact on either payments to individual farmers
or the overall funds available to pay farmers. The entitlements
that farmers make their annual payment claim against under the
Single Payment Scheme (SPS) were allocated in Euros. However,
unless they request otherwise, farmers are actually paid in sterling
at a rate fixed in accordance with EU Regulations. RPA then reclaims
the funding for those payments from the European Commission in
Euros. The risk arising from exchange rate fluctuations between
the date on which the rate is fixed (end September) and the date
the funds are reclaimed (the payment window runs from December
to June) is borne by RPA. The Agency manages this exchange rate
risk through placing hedging contracts with the Royal Bank of
Scotland. The hedging contract can only mitigate the risk, not
eliminate it entirely. Volatility in exchange rates in 2008-09 highlighted
some issues around the hedging arrangements and these are consequently
being reviewed.
19. The Defra Resource Accounts note an £80 million
under-spend against EU funded Rural Development Programme schemes
"because of slow uptake (particularly through RDAs)".
Why has there been this slow uptake? Does this under-spend simply
represent a slippage of funding from 2008-09 into 2009-10,
or a permanent diminution of expenditure on these schemes?
The England Rural Development Programme (ERDP) was approved
by the European Commission in December 2007. This was nearly a
year later than the start of the programme period, in part because
of the delays in reaching agreement in the EU on voluntary modulation
(transfers from direct payments to rural development) which was
necessary to fund the programme. The measures being delivered
by the 8 RDAs could not be introduced until programme approval
had been received and, whilst some preparatory work had been undertaken
by the RDAs, they could not enter into any agreements with beneficiaries
without risk of disallowance of EU funding. Once the programme
formally began in early 2008, it inevitably has taken some time
for the delivery to gear up, through the process of initiating
and developing projects and bringing them to fruition. This is
particularly the case with the LEADER approach under axis 4 of
the Rural Development Regulation, where the first task was to
select and establish the Local Action Groups and agree their Local
Development Strategies before expenditure on projects could begin.
It is also worth noting that the economic downturn had the effect
of slowing uptake of the programme, because of its impact both
on access to private finance and the effect on business confidence
to invest.
Unspent EU funding may be rolled forward for up to two full
years following the year to which it was allocated. Defra is working
with the RDAs to establish a realistic profile for future budgets
to enable them to fully utilise the available funding in future
years.
20. The Defra Accounts note that the Management Board
are monitoring 12 major programmes (p32). What are those
programmes?
The 12 programmes monitored by the Management Board
are listed below. These programmes were felt to merit monitoring
at Management Board level because of their importance to achieving
our key objectives and/or their cross-cutting nature.
2. Sustainable Performance Programme
3. Responsibility and Cost Sharing Programme
4. EU agriculture and Budget Strategy
5. Farming for the Future
6. Adapting to Climate Change
9. Water Availability and Quality
10. Managing Flood and Erosion Risk Sustainability
11. Sustainable Consumption and Production
12. Rural Development Programme England
21. Note 13 in the Defra Accounts notes variances
between Estimates and Outturns for the net operating costs of
particular bodies. What are the reasons for the more significant
variances -for Animal Health, Environment Agency and Natural England?
The following table notes variances between Estimates and
Outturns, and provides explanatory comments:
Area | Variance (£k)
| Explanatory Comments |
Animal Health | 15,500
| Internal re-allocation of budget, mainly due to Marine Fisheries Agency
|
| 17,600 | Mainly due to activities in the Business Reform Project being deferred to 2009-10
|
| Environment Agency | 76,600
| Mainly water industry closed pension fund. Utilisation of the provisions is non-voted and results in a credit to the outturn which is not reported against the estimate
|
| Natural England | 34,700 |
Mainly because the Genesis recharge costs, accrued for correctly in 2007-08, were paid in 2008-09 resulting in a higher Grant in Aid Requirement
|
| |
|
22. Note 21.1.4 in the Defra Accounts notes a £33.4 million
onerous lease provision. What are the properties in question?
An "Onerous Lease" is a contract in which the unavoidable
costs of meeting the obligation under the contract exceed the
economic benefits expected to be received under it. The onerous
lease provision was created to reflect that there were property
(occupation) contracts in place in relation to properties that
were surplus to operational requirements. The other key requirement
was that the properties were in the opinion of the Department
and supported by advice from professional advisers, unlikely to
be disposed of early, or the liability eliminated through other
means. Where parts of the property remain occupied the provision
relates only to the costs of the vacant elements.
The properties in question are:
The majority of the site is occupied by Other Government Departments,
with the remaining vacant space available to wider Government.
Location considered to be unattractive by Departments. No commercial
demand.
Trinity Court, Exeter £68k
Former Agricultural Intervention Board office in poor condition.
Competition in better condition.
West Wickham, Summit House £488k
Former HQ of the Agricultural Intervention Board declared
surplus some years age. Surplus space has been successfully sub-let
for a number of year, but has fallen vacant at sub lease end.
Property is in a poor location for office use & demand has
reduced due to economic conditions.
Ponton Road, London £1,607k
Property (document storage facility) declared surplus following
a review of Defra's London filing provisions. Security requirements
of other users on site severely restrict other potential users.
1a Page Street, Westminster £26,142k
Large central London office declared surplus following Defra's
London accommodation review. Being marketed since vacation, but
little demand from Other Government Departments for large amounts
of central London office space. Location considered poor for commercial
users.
Ashdown House, Victoria Street, London £4,090k
Review of significant Defra space in this building resulted
in smaller requirement. Defra liable for vacated space under contract
arrangements with the landlord. Reduced demand from Other Government
Departments & commercial occupiers due to economic conditions.
23. Both the Defra and RPA Accounts report a £362,000 loss
for the RPA relating to Creature Comforts Ltd. The Committee would
welcome some details, including the nature of the loss and its
cause.
In March 2003, Creature Comforts Ltd (CCL) applied for a
grant under the Rural Enterprise Scheme, a scheme within the 2000-06 England
Rural Development Programme (ERDP). The scheme was administered
by the Regional Development Service (RDS), then part of Defra.
In May 2005 CCL went into liquidation due to market
pressures and changes to planning permission required to run the
business effectively. At the time of entering liquidation CCL
had not fulfilled the terms of requirements related to its grants
which therefore stood to be recovered. RDS and RPA were, however,
unable in practice to recoup any of their losses and the amount
was consequently written off in August 2008.
Responsibility for legacy schemes under the ERDP has passed
to the Regional Development Agencies (RDAs) who have implemented
a process of thoroughly assessing future grants under the Rural
Development Programme for England 2007-13 socio-economic
measures. Where planning permission is required the planning request
is fully researched and must be approved by the Council prior
to awarding a grant.
3
Review of progress report with full list of recommendations can
be found at: http://collections.europarchive.org/tna/20081027092120/http://defra.gov.uk/erdp/schemes/es/es-report.pdf Back
4
http://www.defra.gov.uk/rural/policy/dso/index.htm Back
5
http://www.nao.org.uk/what_we_do/other_specialist_expertise/efficiency/csr07.aspx Back
6
http://www.defra.gov.uk/corporate/policy/regulat/better/documents/simplification-plan-081210.pdf Back
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