COMMITTEE FOR THE OFFICE OF THE FIRST MINISTER AND DEPUTY FIRST MINISTER

OFFICIAL REPORT
(Hansard)

The Review of Public Administration and the Draft Public
Authorities (Reform) Bill

12 March 2008

Members present for all or part of the proceedings:
Mr Danny Kennedy (Chairperson)
Mrs Naomi Long (Deputy Chairperson)
Mr Francie Molloy
Mr Jim Shannon
Mr Jimmy Spratt

Witnesses:
Damian Prince )
Maurice Dowling ) Office of the First Minister and deputy First Minister
Neill Jackson )
Jim Hamilton )

The Chairperson:
Good afternoon, gentlemen. I welcome Damian Prince, Maurice Dowling, Neill Jackson and Jim Hamilton, who are here to give the Committee a two-fold briefing and answer questions on the review of public administration (RPA) and the Public Authorities (Reform) Bill. That is the order in which we intend to conduct business. Do you wish to make a brief outline statement on the RPA, or are you content to move to questions?

Mr Damian Prince (Office of the First Minister and deputy First Minister):
I will make a brief statement to pick out a few highlights in the paper, to concentrate on the role of the Office of the First Minister and deputy First Minister (OFMDFM) in the governance of the RPA initiative, and to explain in more detail strand four of the RPA, which covers the rationalisation of quangos, and which has most relevance to the Public Authorities (Reform) Bill that will follow.

Previously we characterised the RPA as being organised into four sectors: health; education and libraries; local government and the rationalisation of quangos. With regard to the first sector, members will be aware that the Minister of Health, Social Services and Public Safety recently outlined fresh proposals for the reorganisation of the Health Service, the highlights being the already-completed retention of the trust reorganisation; the amalgamation of the four Health and Social Services Boards into a single commissioning authority; the establishment of a common services agency with support functions; and the establishment of a regional health authority.

The Health Department will also continue to aim for £53 million savings from administration costs, and a final business case is in preparation. The Health Department still has the challenging implementation date of April 2009 for those reforms.

In the case of education and libraries, the education and skills authority is to be established through two legislative stages. The first stage will establish the education and skills authority itself, and that will be completed by April 2009. The second stage will seek to establish a single employing authority for schools. That will require a more complex piece of legislation, for which policy work is ongoing. The Department of Education has secured £50 million to make the change happen, and it hopes that, by year 3, £20 million per annum will begin to accrue from administration savings. The library authority is on target to be established on 1 April 2009, and a business case, detailing the operational costs of the new library authority, is currently with the Department of Finance and Personnel.

The third sector is local-government reform. I have said on previous occasions that that reform lies at the heart of the review of public administration. The original decisions for local government are under review by an Executive subcommittee, and we hope to have its final findings very soon. Emerging findings were published in October 2007, and, at that stage, no decision had been taken on the optimum number of councils. However, there was an indication that the number of functions that were to transfer to councils would be scaled back. There would also be a reduction in the number of staff and the budgets that would transfer. There is a critical date in that local-government elections are scheduled for 2009, and the tentative date for establishing the new councils is 2011. However, I have not seen the final report on that.

The fourth sector bears a relation to the Public Authorities (Reform) Bill, which will be discussed in this briefing session.

I accept that it is difficult to get a handle on the remit of the quangos’ rationalisation, because the RPA is, to some extent, changing its scope as the reviews of the various sectors proceed.

We included in our submission a table setting out the quango decisions and the current position. That was extracted from the March 2006 document, which set out the final decisions of the RPA. On reflection, that table may not have been as useful to the Committee as we had hoped. It includes a number of bodies that have merged or have been wound up, and others that have been retained, but with some of their functions transferred to other organisations. We tried to put a simple figure on the size of reduction there has been, but that was difficult. If members would prefer that information in a different, more useful, format, we will work with the Clerk of Committee to produce that.

I must point out and apologise that there is an error in the table: the very last entry, on the Northern Ireland Housing Council, is incorrect. Transfer of its functions does not depend on the establishment, or otherwise, of an environment agency. The initial document stated that plans for the Housing Council were that its functions would transfer to local government when the new councils were set up. However, the current situation is correctly set out — thankfully — in our colleague’s paper on the draft Public Authorities Reform ( Northern Ireland) Bill.

In March 2006, the original OFMDFM review team was stood down, because the review was over and Departments were to get on with implementation of the RPA. The current review team was set up again in October of that year, and its focus was on co-ordinating implementation, because at that stage we anticipated a two-year period of intensive change and reorganisation. Devolution has had a significant effect on the RPA, not only because of the series of reviews of the original decisions, but because governance of the initiative had to be reconsidered to reflect the current devolved situation.

On 19 July, the Executive approved a governance protocol for the RPA. The substance of that was related to the Committee in our paper of 7 September 2007. The key highlights are that ownership and oversight of the RPA lies with the Executive, and not specifically with OFMDFM. The central unit has a reduced role from that originally envisaged. We co-ordinate and report information, and we supply a quarterly update report on the RPA to the Executive. We are preparing the third report, which will reflect the position as at the end of March this year.

The impact of RPA on OFMDFM as a Department is small in some respects. The only function reform, if I can call it that, in which we are directly involved is the proposed extension to the new local government set-up of a responsibility for civil contingencies arrangements, and for the incorporation of good relations strategies in community plans.

Our submission mentions that we are approaching a key milestone for the RPA, when we might again have all the final decisions of what will be implemented. At that point, it will be appropriate for us to stand back and see how current governance arrangements will operate, and whether or not they should be reviewed with a view to doing something different.

The Chairperson:
Thank you very much for that overview. When do you now expect implementation of the RPA to be complete?

Mr Prince:
Previously, we had all been heading for the same timeline and, in the analogy that has been used before, the convoy is starting to separate somewhat. We now have education and health anticipating April 2009 as a start-up. The key piece in the jigsaw is local government, for which we have no timeline.

Mr Shannon:
Some concerns have been expressed in the Committee about the number of quangos and the number of people on them. Is there an intention to reduce those numbers? What do you think will happen? Many members consider that those numbers are unnecessarily high and that they represent an unnecessary financial burden.

Mr Prince:
The focus of the review of public administration (RPA) was to set up an administration system that was simpler, more straightforward and which the public could better understand. Part of that focus was a rationalisation, so that rather than be sent from pillar to post with an enquiry it would be possible to go to one organisation to sort out everything. Departments do not need an initiative such as RPA to see whether the current number of public bodies is the right number. There is always a requirement and a duty on all Departments to be able to say that their configuration makes the optimum use of public money. RPA started the process of looking critically at non-departmental public bodies (NDPBs) to see if they were properly configured or whether a more sensible configuration could be put forward. However, that never detracted from the requirement of government departments to be able to justify the number of public bodies.

Mr Shannon:
Is it the intention to transfer housing and the Housing Executive to local councils?

Mr Prince:
No.

Mr Shannon:
The reason I ask is that the draft research paper on the Public Authorities (Reform) Bill refers to Ards Borough Council’s consultation response. I was at that meeting at Ards Borough Council and my recollection, had the council made a response, would have been that we would have wanted to see the Northern Ireland Housing Executive power transferred to local councils. What you seem to be recording here is slightly different. I am happy for you to return with clarification. I personally made a contribution at that meeting, asking that responsibility for housing be transferred to local government because local government should be in charge of housing. You refer to the Housing Council which is a different body to the Housing Executive. What was the councils’ response to the consultation? Were they, for example, as a whole in favour of the transfer of Housing Executive powers? I am quite happy for a response to the Committee at a later stage.

Mr Prince:
The original reference to the Housing Executive was that there was a proposal to transfer certain of its functions to local government. However, that did not mean that the whole Housing Executive would be disposed of and the functions transferred, lock, stock and barrel. I do not immediately recall those functions —

Mr Shannon:
One was the allocation of houses, as well as maintenance and repairs, grounds maintenance and — importantly, because it relates to social housing — responsibility for allocating or suggesting building land for housing associations. Personally, I would be happy to see all those functions put into the hands of local councils, although not everyone will agree with that.

The Chairperson:
Hansard is reporting the event, of course.

Mr Shannon:
I am happy to say it again to have it recorded twice.

Mr Molloy:
I reckon they are not capable of doing it yet.

Mr Shannon:
OK.

The Chairperson:
That is your initial take on it.

Mr Maurice Dowling (Office of the First Minister and deputy First Minister):
In the final announcements that were made in 2006, the Housing Executive was going to remain as a body attached to the Department for Social Development. There was never an intention for it to move to local councils. That decision was taken in 2006. As part of the ongoing review in local government, that matter has still not been taken into consideration.

Mrs Long:
I liked your analogy of the convoy separating. That is probably more generous than the public opinion of local government, which is that the wheels have come off. The focus of the RPA was more efficient and understandable governance arrangements, and coterminosity was part of that. The convoy separating — as one might wish to call it — seems to have created problems. The police service was reorganised along certain lines, for example. Those might not be the lines along which local government chooses to reorganise itself. Progress is being made in the education and health sectors.

What effort is being made not to produce, at the end of the reform process, a different set of non-coterminous boundaries for public services that end up being just as complex for people to understand and negotiate? At least people have experience, built up over years, of dealing with the complexities of the current set of boundaries. My biggest concern is that people will be even more detached from the organisations and functions being delivered than they ought to be.

Mr Prince:
That is a big question. One of the difficulties in answering questions about coterminosity is that, until we know exactly what the boundaries are going to be, it is difficult to put flesh on the bones and explain how that will work. During direct rule, we were firmly assured that there would be seven boundaries. Even then, one-to-one coterminosity was impossible, as there were five health and social care trusts, six further education colleges, and so on.

Coterminosity is still on the agenda. Key organisations know that there will be boundaries and have left enough flexibility, in both the Education and Skills Authority and the new commissioning bodies for health, to align with whatever boundaries emerge. The difficulty was that coterminosity was always going to be available only on the commissioning side of planning for services. It was never going to be possible to have an acute hospital in every local administrative area, and to have seven, 11 or 15 free-standing administrations. However, what is possible, and where the coterminosity prize will be won, is to have strong local government and strong community planning. That is essential to ensuring that whatever comes out of the review process will be better understood by the community and will provide the better services promised by the RPA.

Mrs Long:
One-to-one coterminosity is not an issue. Most of us sitting round this table — particularly those of us who deal with the Ards and east Belfast area — know that the lack of coterminosity among education and library boards, council areas and parliamentary constituencies, for example, creates a degree of complexity that should not exist. Instead, it concerns simplification. People living in different areas should know who provides their services, and how they access those.

You raised the matter of strong community planning. Is coterminosity still a priority? Are strong community planning powers for local councils still a priority in this process? This Committee has declared an interest in relation to local councils; however, it looks increasingly as if some of the community planning functions will be watered down, and I am concerned about that. Essentially, that will give us the power to produce a wish-list at local government level, and not a to-do list. The powers and functions required to deliver on some of those issues will not exist. I would be interested to know whether that is still a significant part of this process.

Mr Prince:
We have talked to colleagues in the Environment Department, and my understanding is that community planning is still very much in the centre of things in relation to the reforms. I am not competent enough to comment on the statutory basis of just how strong that is. I do not have that information or fine detail with me, but it is something on which I could reflect upon and come back to you.

Mr Spratt:
I will make a brief comment, since Naomi Long mentioned it, about reorganisation in the police. Certainly, the Police Service has changed, but the service to the public has not improved. I do not ask for comment, but perhaps the officials could reflect upon that.

Mr Molloy:
I would certainly not comment on that. It seems strange that the local government section that is the smallest part of the budget, at 4%. Even the maximum that was proposed in the outcome was only around 9%. That is the slowest part to get into operation. It seems that from the beginning of the process, the Department of Health, Social Services and Public Safety was allowed to go ahead of everyone else and set up its own structures. Coterminosity never came into it. The Department of Education also did its own thing. Each Department was encouraged to go ahead of the rest. There was never a collective line. Although the Departments may be separating now in more clear terms, they were clearly separated from the start, particularly when someone from the Department of Health, Social Services and Public Safety was put into the RPA working group and was able to drive it. The Government had a clear intention of what they were going to do.

The transfer of powers seems to be something Assembly Ministers are clawing back — even those minimum powers that were being transferred. We are now in the situation where they have got into the cupboard, and they want to hold on to everything in it. Even the small issues that could have given local government some meaningful power have disappeared. The Housing Council is a typical example; it is a talking shop, and has been for several years. Councillors do not have any time to sit on it, and it does not have any power or bite. It cannot do anything. Nonetheless, we find that it is retained by the Minister as soon as we get into power.

Quangos are being reactivated. If democracy is to take over, there must be a strategy to bring those powers back to local government. There is talk about tourism and economic development, but the forests, lakes and rivers have not been handed over to local government to allow them to get on with managing situations at close hand.

We will never find ourselves in the situation of having five hospitals in a rural area. However, there is no problem with having five hospitals in Belfast. Belfast has all the hospitals, and that causes difficulties for people living in the sticks and the rural areas where there are no hospitals.

On the plan of general competence — as Naomi has said — the power that has been given is just a collection of wish lists, and it does not give local government the power to enforce any of them.

The Chairperson:
You may wish to frame a question.

Mr Molloy:
The general question is are we really talking about a review of RPA that will mean that local government has the power to deal with the needs of the area? The power of general competence will give local government that. However, the Government seem to be holding back. They are talking about power and about communities, but no power has been transferred.

Mr Prince:
The actual transfer of money to local councils was always going to be quite a small percentage of overall public spending in Northern Ireland. Local councils were not going to get their power and authority because they were big players as regards spending. Influence would be based on the fact that they could formulate a community plan, in which all the other organisations had to participate. The privileged position, which still pertains for local government, is that they will set the boundaries that everyone else will face.

I accept that in some of the reorganisation that has happened already — for example, in the health trusts — there may be some local authority areas which share more than one health boundary. That may not be so problematic as regards the acute hospitals. Nevertheless, it may cause problems for the social services side, where a person may wish to go into a particular nursing home but the area is spread over two health boundaries. However, that will be resolved in the community planning process. Health and social services will have to say exactly how services will be delivered in total to that area, and not just how services will be delivered under particular domestic arrangements that it has set up for itself.

The Chairperson:
How many of the current 81 public bodies do we now expect to have at the end of RPA, and how many new bodies have been created during the RPA process?

Mr Prince:
I do not have the maths on that. I will come back to the Committee with that information.

The Chairperson:
We will now move on to public authority reform. Do members have any questions on that subject?

Mrs Long:
There was one issue concerning the abolition of the Disability Living Allowance Advisory Board for Northern Ireland, and in particular about the education function that it provides for local government initiatives in relation to disability. When that body is abolished, what will take over the responsibility for that educational role? The draft research paper on the Public Authorities (Reform) Bill highlighted Disability Action’s concern that

“an education function the Board was able to provide for local government initiatives relating to disability will no longer be available.”

That function will not be provided by the UK-wide body. Will it be transferred elsewhere, and to whom?

Mr Dowling:
It is not an issue that has been raised with us before, but I will be able to provide you with an answer in writing.

The Committee Clerk:
The issue was raised by the Assembly Research Service in discussion with some of the stakeholders. In addition to the advisory function, the board has an education function that it provides to local government. The question is where that function goes if the board is abolished. Does it stay with the UK-wide body?

Mr Neill Jackson (Office of the First Minister and deputy First Minister):
We can ascertain from DSD the remit of the new arrangements outlined in the legislation and come back to you on that.

The Chairperson:
Thank you very much for your presentation. If there are any other queries we will submit them to you for further reference. Good afternoon.