National Assembly for Wales

Prynhawn da. Welcome to the Equality and Social Justice Committee, where we will be discussing the Social Partnership and Public Procurement (Wales) Bill with the Deputy Minister for Social Partnership. During that part of the meeting, Sioned Williams and Altaf Hussain are going to be substituted by Peredur Owen Griffiths and Joel James, in order to have consistency in our discussions of the social partnership and public procurement Bill. Obviously, simultaneous translation is available from Welsh to English, and the meeting is being broadcast live on Senedd.tv. Are there any declarations that Members need to declare in relation to the business this afternoon? I can't see anybody raising their hand.

First of all, I wonder if we could just note four or five papers relating to the youth justice blueprint, the future generations commissioner and the role of the Welsh Government in relation to the Well-being of Future Generations (Wales) Act 2015, and four other letters, which includes the delay to the pre-appointment hearing for the national adviser for violence against women, gender-based violence, domestic abuse and sexual violence. Does anybody wish to raise any issues around that before we note them? Thank you. 

We'll now move into private session for the next item, in order to have a private briefing, and we'll come back at 3.15 p.m. in public session for our scrutiny session with Hannah Blythyn and her officials. Thank you very much. We'll now move into private session. 

I'd like to welcome members of the public and members of the committee to the first scrutiny session on the Social Partnership and Public Procurement (Wales) Bill, which is with the Minister in charge, Hannah Blythyn, and her officials. So, welcome, Minister. Would you like to just briefly introduce your officials for the record?

Yes. Thank you. It's a pleasure to be with you here today for the first session on this piece of legislation. So, to my right is Neil Surman. I've got a test to see if I get everybody's titles correct now. He's the deputy director for social partnership and fair work. On my left here is Sue Hurrell, who is head of fair work and social partnership.

Fair work procurement.

Fair work procurement. Then, next to Sue is Neil Buffin, who is part of the legal team.

Yes, indeed.

Very good. I think you have got one of your officials who is joining us online. Is that right? Yes. Excellent. I'll just start off, Minister, by asking you, when we have the well-being of future generations Act, and we've been working for some 11 years on getting procurement right, why you think that we now need legislation.

Thanks. As you point out, and I have said it before in the Senedd Chamber, social partnership working has become very much a Welsh way of working over the course of devolution. It was something that was born out of crisis initially, really, in Wales, with the economic crisis, and then really came, I would say, to the fore in demonstrating its value during the most recent coronavirus pandemic. What we are doing now is legislating to put it on a more formal footing and a statutory footing for the first time, which makes it a permanent feature of Welsh civic life and doesn't leave it to chance. As you say, it has been operating across the piece in Wales. By formalising this approach, it brings that consistency and a system-level approach, and will hopefully produce clarity as well.

Much of it we already do, but in a much less cohesive way. It does actually specify the purpose of social partnership—to enhance the well-being of the people of Wales by improving public services, promoting fair work, and carrying out socially responsible procurement. We hope that by creating a holistic approach by legislating in this way, we guarantee that the structures and duties in place will work in synergy and together for the benefit of the people and well-being of Wales.

In terms of procurement, many of the reviews that we've seen over the past few years have shown that we are making progress on procurement, and recognise the value of procurement and the leverage that that gives us in trying to achieve those social values and objectives. In order to make better practice and make better progress and good practice more consistent, there would be the need to legislate in doing that. I don't know whether Sue wants to add anything on the procurement side. 

There have been a number of reviews by different bodies—by the audit office and by Senedd committees as well—and they tend to pick up on very similar issues. I think that, sometimes, that doesn't reflect quite a lot of good practice among public bodies, and there's a frustration sometimes that there's always focus on areas where there is, obviously, a need for improvement. So, I think that this will allow public bodies to be able to, annually, talk about some of the good things that they are delivering—sharing good practice, which then can be extended—but also help to identify where there are areas of weakness, and then more interventions and further investigations. The legislation makes provision for what can happen to really address some of those areas of weakness. So, it's really about making good practice more consistent and a means of identifying poorer practice, and then addressing those difficulties.

Okay. We'll come back to procurement a bit further into this meeting. But just to ask the Minister further, the explanatory memorandum highlights that the Bill complements the well-being of future generations Act and the socioeconomic duty. How do you think that is going to make it easier for the citizen to understand what ought to be happening, and whether it is happening? 

That's a very good point there, Chair, in terms of actually creating greater clarity as well. That's why we've been very keen to make sure to look at how we better align and better link up between this legislation and a uniquely Welsh piece of legislation, as we call it—the well-being of future generations Act. The well-being of future generations Act broadly provides that national legislative framework for Government and public bodies to work towards the well-being goals that seek, as you said, to improve social, environmental, economic and cultural well-being. The social partnership duty is designed to strengthen that by using the role of social partnership within strategic decision making. So, the social partnership duty is almost, I would say, a means to an end in terms of actually achieving those well-being goals and objectives, and involving workers and employers in setting those objectives as we move forward. 

The Bill amends section 4 of the well-being of future generations Act by substituting 'fair work' for 'decent work' within the existing 'a prosperous Wales' goal, which reflects an aspect of the approach recommended by the Fair Work Commission back in 2019, which was endorsed by social partners. It really supports and recognises the idea that fair work contributes to the goal of 'a prosperous Wales', and also, obviously, to individual and collective well-being. 

What discussions have you had with the future generations commissioner on this Bill, given that she's paid a particular interest to procurement, and is also now doing a section 20 inquiry into the ways of working of the Welsh Government? 

We've had regular engagement with the future generations commissioner herself, and also with the office of the future generations commissioner. I think the really important point to make is there's been a lot of positive engagement and positive input into the development of this legislation right from the outset. They've been key partners and stakeholders in taking things forward. The key thing goes back to what you previously said, really, in terms of that we do not intend for—and nor should it—social partnership to operate within a vacuum, and the Bill makes it clear that social partnership should be a fundamental principle that underpins the way in which public bodies work.

We've been clear in those meetings with the commissioner—. You mentioned the section 20 review; if I just pick up on that point. Various Senedd committees have highlighted the importance of ensuring that when we are developing legislative proposals, we look at how they can complement the well-being of future generations Act. And I think one of the things we've been very mindful of when we've been working with partners in developing this legislation is to actually address some of the concerns about complexity and competing priorities, and making sure that the legislation is aligned closely as well. 

I think it might be helpful to bring in officials at this point, just because I know a lot of those ongoing conversations on a regular basis with the future generations commissioner's office on some of the specifics have been done at an official level. Neil.

Just following what the Minister was saying, it's not just that we've had regular contact with and discussions with the future generations commissioner and her office, but she has broadly been very supportive of what we're seeking to achieve through this Bill. She was one of the many respondents to the consultation on the draft Bill last spring, again, supporting what we were seeking to do here.

I shouldn't speak for the commissioner, but I think—. Importantly, this Bill doesn't change the commissioner's functions, but I think the commissioner and her office see some merit in it, because it gives that line of sight between the nature of the decision making within public bodies and the well-being goals that we're seeking to deliver. And it introduces social partnership as a means for doing that, and strengthening that strategic decision making and policy making within Welsh public services. So, I think there's a virtuous circle there between what we are trying to do as a method for supporting the delivery of well-being goals, and the very clear goals set out in the well-being of future generations Act and the role of the commissioner in overseeing those. 

On procurement, I think Sue is better qualified to comment on that than I am. 

Again, the future generations commissioner and her officials have welcomed this bit of legislation as a means of addressing some of the weaknesses that obviously she found in her section 20 report. One of the concerns that they had was about duplicating effort in reporting, et cetera. We've been clear, right from the beginning, talking amongst officials and with the future generations commissioner's office, that we will do everything we can to make sure that burden is kept to a minimum, by not requiring additional and separate and duplicated reports, but by streamlining that work. So, in a sense, on the procurement side as well, it's a means to further embed what's already in that Act, and put more structure around that, with respect to the public procurement functions.

The public sector overall faces huge challenges at the moment; the post-pandemic recovery, the cost of living, the climate emergency, are all issues that are challenging all public bodies. How can you say that this isn't going to be the straw that breaks the camel's back in terms of the workload for these bodies? How can you demonstrate that this is actually going to reduce the bureaucracy of their workload?

I think it goes back to what was said previously there by Sue in terms of we're going to seek to align these reports with existing requirements and cycles. So, there will be things that public bodies are already familiar with and are already used to doing. We've always been very conscious as we take this forward to make sure that any new requirements are proportionate and that we're able to monitor the impact of the duties on these public bodies, and of course we will be working very closely with them over the course of the next coming days and months as this comes forward, in terms of developing any guidance or support that needs to sit alongside it as well. I think that a lot of thought has gone into how we minimise the reporting burden, as Sue just previously touched on. Our expectation is that the vast majority of public bodies, because of being familiar with some of these, will be trying to dovetail the reporting mechanisms together, and they will be familiar with it, and our expectation is that they will be able to do that. But if they do have concerns, either around that or around costs, we are very much open to having those conversations—this is a working process—and to develop that in partnership, moving forward.

Thank you. I'd like to bring in Peredur Owen Griffiths at this point.

Thank you very much, Chair, and welcome, Minister. On the regulatory impact assessment, I'll probably go into a lot more detail in Finance Committee in a couple of weeks' time—

With your other hat on.

—with my other hat on, so I'm not going to dwell too much on that, and we'll go into that scrutiny in that session. But, looking at the Bill, it will impose a number of additional costs onto public sector organisations, in particular almost £20 million in construction contract management costs. Have you given any thought to whether the Welsh Government will be providing any funding to cover this?

Thanks. We expect that many of the public bodies and our social partners are already doing many of the actions associated with the Bill's duties, so, at this point, we don't believe there will be any additional financial burdens or financial support needed, and we expect that they will be able to meet the costs. But referring back to what I said previously, if public bodies do have concerns with the costs, we will have those conversations with them about actually what can be done to mitigate any of the impact in terms of actually how we can work with them to address that. I don't know if Sue wants to come in, in terms of the procurement construction costs and how we got to that point.

Yes, so, the largest figure, as you say, is to do with construction contract management, and I think this reflects the fact that currently the main focus, probably through contract management, is delivering things to the time, cost and quality we expect, and health and safety, and we're actually potentially asking for quite a lot of new things to be looked at in detail through supply chains. So, that will be a resource-intensive activity and not something that you can just use IT systems, perhaps, to do. So, yes, there will be the need for organisations to divert more attention, perhaps, from some things, but into focusing on ensuring that due diligence through those supply chains. But we're still—. When you spread that out amongst the different organisations we're talking about and some of the sizes of their construction budgets, when we've talked to people in the public sector about this, it doesn't seem like an unreasonable—. You know, they've thought it seemed like a reasonable additional amount of extra input and resource.

And with regard to that particular element and the rest of the financial implications of this, what consideration have you given to inflation at 10 per cent currently?

Well, I was in a meeting just a few days ago with some people from the construction sector who were talking about the huge challenges that they face at the moment, and it's a difficult time to be having these kinds of conversations with the construction industry, but we are talking about developing statutory guidance that will come into force some time from now. And those mechanisms for sharing risk within the construction sector, I'm not really a construction sector expert, but those mechanisms do exist in types of forms of contracts, so there will be an opportunity for us, as part of developing the statutory guidance, to consider whether we can make better use of those good practices in risk sharing, which might address these sorts of crises in future. So, there's an awful lot we can do through the development of statutory guidance, and I think the trick will be to really engage well with the sector, private and public sector bodies, to make sure that we develop things that are really sort of stretching, but also workable.

Okay. And we talked earlier about the future generations and the future generations commissioner and you've been working alongside her in that role. You've talked a lot about minimising burden, which implies there will be a burden, probably, even though—. So, what about the cost involved in that extra burden? What conversations have you been having around helping to ease some of that cost? Will there be a cost involved in covering that bit of minimised burden?

I take it you're referring specifically to the future generations commissioner.

Yes.

So, I think the first thing that's really important to make clear is that the legislation doesn't place any extra responsibilities on the future generations commissioner as a consequence, but I think the other thing to be aware of is that, alongside this Bill, there is currently a review taking place of the public bodies covered by the well-being of future generations Act. So, if that sought to expand the bodies covered by the Act, then of course that will expand the public bodies that are covered by the social partnership duty, so my officials and my colleague the Minister for Social Justice are in dialogue with the future generations commissioner around what the implications of that would mean for her office, should the duty and therefore the social partnership duty cover other public bodies.

So, I'm not sure—. I'd probably be jumping the gun. I don't think it's gone out to consultation on the review as yet, but obviously there'll be an opportunity to feed in views on what that would mean in terms of expanding the coverage of the public bodies covered by the duty.

Okay. Thank you.

Thank you. Jane Dodds wanted to come in on this specific point.

Yes. Hello, there. Good afternoon, Minister, it's nice to have you with us. So, if I may just follow up on what you said about public bodies, we know that housing associations and further and higher education institutions are not covered in this Bill, although they were in the draft, so is what you're saying that they could be reintroduced into this part of the Bill, or not? Is it that they are going to remain excluded, and also, could you just say a little bit more about the reasons? As we understand, it touches on their charitable status. I'd just be interested to hear how you've approached that and whether there is any scope for those housing associations and further and higher education institutions to be included. Thank you, Chair.

I think the question, too, as well as linking to the public bodies covered by the well-being of future generations Act, there was also a link to the UK procurement legislation that is currently going through the process as well. So, I think it might be an opportunity just—. If I can ask Sue perhaps to touch on the first aspect of that, in terms of UK procurement legislation, if that's okay.

Yes. Part of that UK procurement process that's been going through has been looking at how those UK laws fall on Welsh bodies and on which particular bodies, and that's been quite an important piece of work. That is a larger set of bodies, and powers are also given to Welsh Ministers, as part of that legislation, for those bodies. So, that may then allow us to have another look at the organisations that are covered by the procurement duties. I'm wondering whether, Neil, you might have something more to say about this, and powers and bodies.

Well, to some extent, it's parasitic on the WFGA. So, to the extent that public bodies are expanded in the WFGA, that will have a read-across to who is covered by various duties under this Bill. But, certainly, there would be the opportunity to amend the list of bodies from time to time.

Okay. Jane, did you want to come back?

Yes, if I may. I don't want to spend too long on this. You started, Minister, by talking about consistency and clarity in this Bill, so I'm just a little bit unsure how it's amended or what decisions are made, how they're made, if you do want to change it. Because, presumably, you'd want to make sure that you had a really good, well-founded piece of legislation to go forward with, and, at the moment, as we understand it, housing associations and higher institutions of education are not included. So, just thinking about how that goes forward, really. I don't want to spend too much time on it, Chair, but just some clarity on that would be helpful. Thank you.

Absolutely. I'll just bring Neil in on the process.

Thank you, Minister. I think there are essentially two different lists. One is the list of public bodies that are already within scope of the well-being of future generations Act, and that are, therefore, caught by the social partnership duties that we're introducing through this Bill. As the Minister was just saying, there is a process, if it's not under way already, about to begin, to consult on that list of bodies, and whether bodies that have been created since the 2015 legislation was brought in should be included within the scope of the well-being of future generations legislation. So, that's one process through which, I suppose, decisions on that can be influenced. There is a longer list—is it of 'devolved Welsh authorities', Sue—to which the socially responsible procurement duties will apply.

And then, if you don't mind, a slight diversion, but in a previous role to this one, I was, for quite a number of years, head of the higher education and student finance division in Welsh Government, so I've had any number of conversations with my university colleagues in Universities Wales about the legal status of universities in different contexts. Taking those as a case in point I suppose, and FE institutions as well, it's not so long ago that—2015, was it, I can't remember, or 2016—we legislated in Wales, and indeed in England, systematically to take FE colleges out of the public sector for the purposes of national statistics. The Office of National Statistics is the body that defines which are public sector organisations, which are private and which are these odd kind of middle category not-for-profit institutions serving households—NPISH. And currently, both FE and HE institutions—I can't speak for RSLs—are classified as not-for-profit institutions serving households. I don't think the ONS interest in that question has ever gone away, really. So, whereas we legislated some time ago, it is still eminently possible that another route, albeit we have a route within the legislation for regulation so it might change the status of FE, HE or RSLs in the future, another route might be outside our control in the form of any current or future reviews by ONS as to the status of those bodies for national accounting purposes. So, it's really quite a complex picture, and there's no one simple answer, I'm afraid. Charitable status is one element of the questions that we deal with, but the ONS has a list of criteria quite a bit more substantial than that.

Okay. We may come back to that, but I think right now we need to move on and have a look at the social partnership council. So, Sarah Murphy, you're going to lead us off on that.

Thank you very much, Chair. Thank you, all, for being here today. Just to start off, I'm going to be looking, as the Chair said, at the role of the social partnership council. So, section 1 of the Bill establishes that there will be a social partnership council. Can you outline what you're aiming to achieve by creating this body, and how will you measure its performance against these objectives, crucially?

Thanks, Sarah. So, as you said, we're establishing a tripartite—I don't know which screen to look at—statutory social partnership council that brings together equal representation of Government, employers and workers on there. It'll have advisory functions, so, through its advisory functions, the social partnership council will be able to support Welsh Ministers and provide the strategic leadership, promoting consistency in the Welsh system of social partnership. It's also an opportunity to provide a voice and participation for employers and work representatives in the development of policy and arranging matters that are covered by the SPC, so, around social partnership, improving the economic, environmental, social and cultural well-being of people in Wales and improving public services. And the purpose, really, will be to provide information and advice to Welsh Ministers on those matters in the Bill.

It's also the intention that, through the social partnership council, it will help also define, through information and advice to Ministers, again, how social partnership is expected to operate more broadly in the devolved Welsh context and it will sit alongside a broader review of social partnership working, which I might ask Neil to touch on in a second, if I might.

In terms of actually how we monitor it, we'd anticipate that there would need to be an evaluation of the impact and the process of the implementation period. Much of the information and advice produced by the SPC, or social partnership council—I don't want to fall into acronyms already—. Much of the information and advice produced by the social partnership council for Welsh Ministers will also be published, so that will allow social partners and the public to assess, in a transparent way, how the SPC, how the social partnership council, is performing and the role that it is carrying out.

I think one thing that I should also add is that we're also committed to a comprehensive evaluation of the legislation post implementation as well. That will enable us to look at the impact of the social partnership council and the other duties associated as part of the legislation. So, we are very much committed to that ongoing evaluation and using the aspects of transparency of the legislation to build and improve. But I don't know whether, if I may, Chair, just bring Neil in just very briefly to touch on how it sits alongside a broader look at the reform of social partnership working as well, alongside it.

Thank you, Minister. So, in relation to current social partnership arrangements, we're taking a good, hard look at ourselves first within Welsh Government, and one of my colleagues is leading a review of the existing social partnership structures and ways of working across Welsh Government—that's across all ministerial portfolios. We have completed the initial scoping phase of that review and if I say that the initial report—although, he's in the process of trying to edit it down—ran to in excess of 70 pages and that's just mapping what currently exists within Welsh Government involving social partnership, it's quite a substantial undertaking. So, we'll be continuing with that work as we move forward. Alongside seeking to take this legislation through the Senedd, we are working already on an implementation plan so that, should the Bill become law, we are ready to move forward with its implementation as quickly as possible. And some of the key decisions that Ministers will have to take at that point are, of course, what this new legislation means for existing structures, current social partnership ways of working and whether any of what we already do within Welsh Government, working with social partners, needs to change or flex in some way in response to the new statutory framework. So, it's quite a significant piece of work for us.

Back to you, Sarah.

Yes, all good. Thank you very much. So, as we know, social partnership models are not new; they started to come about around the first world war and then really took off in Europe after the second world war. So, Belgium, from the 1940s, Austria, the 1940s and 1950s, and, in Germany, collective bargaining autonomy is enshrined in their constitution. We also saw, during the 1990s, with a lot of the economic struggle from the crashes, that it really, again, had life breathed back into it in Sweden, and that is ultimately because they do promote the goal of economic prosperity and high levels of employment. So, I just wanted to ask: what international evidence have you used to help inform the decision, considering that there is a wealth of case studies looking at what works and what doesn't in different contexts, in terms of creating this statutory social partnership council, and what makes a legislative approach necessary, do you think, in Wales? What is the overall aim for the Welsh Government with our social partnership Bill?

Right. Whilst we do say this is very much, we call it, a Welsh way of working, it's not something that's new or necessarily unique to Wales and it has progressed over the years, in different formats, in different countries, particularly some of the ones you touched on—Austria, Germany, Belgium, Sweden—where it's entrenched in institutional structures, and it's essentially built around a culture of co-operation. We know, as I touched on before, that social partnership arrangements have been particularly successful during the COVID-19 pandemic in terms of how they've actually enabled partners to come together and shape and respond to the national responses to the crisis. And there is an evidenced piece of work that we've looked at from the European Trade Union Institute, which looked at the responses of various national Governments to the pandemic and found that, actually, a more inclusive approach to policy making and greater consideration of workers' needs are associated with a more extensive use of social partnership working.

I think, from where we've looked, and I'm sure I speak for the officials—. Well, I'm speaking on behalf of the officials now, but I'm sure we'll be happy to provide any further information to the committee in terms of those resources that we've touched on in helping shape our response and shape the legislation. The research shows, where we do have those legislative, entrenched social partnership mechanisms, it does change the way in which policy is made, but, more importantly, it actually leads to better outcomes. So, it's not just about changing policy for the sake of it or a certain way of working, it's actually using—. Again, it's the means to the end of social partnership as a way of working to achieve better outcomes and better objectives, particularly in this respect, when we're talking about the well-being of the people of Wales and improving public services. I don't know if there's anything I've missed.

I suppose, if I was going to add anything, it would simply be that, while there is, as you say, an awful lot of international evidence and good practice to draw on to inform our thinking, it's not possible for us to do a simple lift from another country and apply the same solutions to Wales, not least because we work within very closely defined parameters in terms of the constitutional settlement, the list of reserved matters to Wales. So, this Bill seeks to make sense of social partnership in our context, within the limits the Senedd can legislate and within those limits that Welsh Ministers can operate. And I think it's important that we've sought to clarify the role of social partnership in Wales, and for the Welsh public sector, from our own perspective. Now, of course, circumstances, conditions, could change over time, and that view might change with it, but, right now, we think this is the right solution and it does what we need.

I think what I meant by my first two questions is not so much the clarifying of the position, though. What I'm asking is: well, how do we measure its success? What is its overall objective? I'm not suggesting that we lift legislation from other countries, especially when some of it's over 100 years old, and they have their own histories and contexts and everything. What I'm asking is: what is our ultimate goal here? Because, in each of those examples, sometimes, like I said, it was to decrease unemployment; sometimes it's decentralisation, globalisation, a commitment to industry growth, decorporatisation. I think the hard thing here is how—. Like I said, how are we measuring whether the social partnership council is achieving what it set out to achieve? What is the overall goal here that we are trying—? Like, what is our objective here for Wales with this social partnership Bill? To strengthen trade unions—?

So, more broadly in terms of the social partnership council and the social partnership duty, as I said, it's about actually how the social partnership approach, that process, that means to an end of evolving the equal voice for Government in terms of the social partnership council itself, that tripartite working between Government, employer representatives and worker representatives, is actually providing a voice through that to shape the policy process, but also, ultimately, to achieve those better outcomes in terms of improving public services and the broader well-being of Wales and of people. And I think, you know, if you look at it in terms of—. If we perhaps just touch on the social partnership duty on public bodies itself, well, actually, it's how you—. Recognising that, actually, taking that social partnership approach, where the people who are involved with providing those services are involved with looking at the objectives and how they are delivered actually, ultimately, not just leads to better services, better public services, but better well-being for the people providing those services as well, and in terms of—. Actually it goes back in terms of making sure we ensure the transparency of the social partnership council itself by regularly evaluating its implementation and having that transparency to make sure that things are published. So, I don't think it's meant to be a static situation, so we can learn and it can evolve and be built on.

I'll come back in here and just be honest and say that that's still very much sounding to me like the process. So, a tangible measurement, then, if we're saying that this should be about workers having more of a voice would be that there are fewer fire-and-rehire situations happening. Maybe that's a measurement that we have, that we see. I think that that would prove that this was working and that bad practice wasn't happening. We could also look at the reforming of policy, as you said, maybe that's a measurement as well: what contributions are workers actually having in reforming policy. I just think that it would be good to have an overarching understanding of what the ultimate objective is here and how we are actually going to be able to measure that.

I just wanted to—. My last question, Chair, is just that, when the Welsh Government produced its White Paper, providing responses to the original consultation on the Bill, you asked—you know, an anonymous survey. Some of the feedback that came from people was that they said that some just may not have—. Because we are a small country, so there are organisations and trade unions, in particular—. Yes, there are the larger trade unions, but there are the much smaller trade unions who sometimes only have a couple of staff. So, they're saying that they don't necessarily have the resources to engage with the process, which may lead, then, to their disengagement. That's what they said. So, they've called on the Welsh Government then to help resource the capacity of the collective employer and union organisations to co-ordinate and support involvement in a strengthened social partnership model. Is this something that you've followed up with them or had a look into?

[Inaudible.]

The Minister's asked me to come back just on the prior point, which is that I think the purpose of this legislation is as stated on the face of the Bill: it is to improve the well-being of the people of Wales via, in part, improving public services. So, that's what we're after. The role of the SPC in relation to that very broad objective is quite specific, and—at a very superficial level, forgive me—has the SPC fulfilled its role? Well, if it's given advice to Welsh Ministers, yes. The real impact, of course, comes in what Welsh Ministers choose to do in response to that advice, and that will depend on the nature of the advice, the subject matter that it covers, the public bodies under consideration. So, there is quite an extended—. I don't like the phrase 'delivery chain', but I think it's well understood. There is quite an extended delivery chain between the work of the SPC in providing information and advice to Welsh Ministers, and then what happens on the basis of that advice, and that could be, clearly, very diverse.

The obligations of the social partnership duties—. I assume you will come to those later, Chair, but the social partnership duties, similarly, applying to public bodies in Wales—. It will be their responsibility to look at how, for instance, the amendment to the well-being of future generations Act, and the change from 'decent' work to 'fair', what that means for them in their contexts.

We will be putting in place, as the Minister said, an overarching evaluation framework for all of this, and the reports coming out of that will, of course, be published, but, beyond that, I think we need to try and create, and, indeed, we are trying to create, a self-evaluating, self-improving system. We've sought to make this framework as open, transparent and accountable as possible without going quite as far as some of our consultees and stakeholders would have wanted, because there were some calls, certainly, in the consultation last spring, for some pretty hard-edged compliance and enforcement provisions to be brought in to back up this legislation, and Ministers have decided not to do that. So, we—

Can we know what some of them were, the hard-edged asks?

Well, financial penalties was one proposal that was put to us. Assuming that these provisions could be made to bite and could be legally enforceable, some consultees argued that there should be financial penalties attached to non-compliance; I think a difficult case, going back to your point earlier, if I may, to make at a point when Welsh public services are severely under resourced, are facing greater financial pressures as a result of the current economic climate. And imposing penalties on organisations that provide, ultimately, services to the public, I think, is a very difficult case to maintain.

Chair, if I may, I think Neil wanted to come in.

Yes, thank you very much, Chair. Could I just add as well, in terms of outcomes and purpose, as both the Minister and Neil have said, it is about well-being, but it's also applying social partnership duties to the sustainable development duties under the WFG Act? So, to some extent, the outcomes will be monitored via the objectives that bodies are also setting under WFG, which ultimately is about the improvement of well-being and the attainment of the well-being goals under WFG. Thank you.

Brilliant. Thank you very much. Thank you, Chair.

Very good. Moving on to Ken Skates.

Thank you, Chair. Thanks, Minister, for attending, and thanks also to your officials. I'm going to ask about membership of the social partnership council, if I may, and begin specifically with section 5 of the Bill. I'd be really grateful if you could explain why the First Minister is required to appoint worker representatives that are nominated by the Wales TUC but only needs to have regard to nominations made by employer bodies.

Thank you for that question. I think the first point to make, actually, is that in both instances the First Minister will have discretion as to whether to appoint specific individuals nominated by employers or the worker representatives nominated through the Wales TUC. It's entirely within the First Minister's discretion to seek alternative nominations, should they determine that that is appropriate or necessary. I think, in terms of employer bodies, which I know Ken will be very familiar with, the numerous employer bodies across Wales are by their very nature—. It's very clear they're representative of their sector or employers who make up their memberships. Our deduction, of course, is that trade unions are the only equivalent bodies able to represent the collective views and experiences of workers in Wales, and that that was the best channel to do it from. We believe that the Wales TUC is best placed in order to nominate worker representatives who will not only be able to effectively represent workers on their existing social partnership council and their functions, but be able to make sure that there is the breadth of representation from sectors and a cross section of experience and skills as part of that. Is there anything to add on that?

Perhaps only to add that we have, at least in initial discussions, made it clear to Wales TUC that, in bringing forward nominations in the future, we would not necessarily expect those nominations only to come from unions affiliated to the Wales TUC. Ministers are very conscious that there's a wider trade union movement out there, and we intend that we shall make it incumbent upon the Wales TUC to bring forward nominations from that wider trade union constituency, and not just from affiliated unions in the first instance.

Excellent. That answers one of the other questions I was going to raise. Just to clarify, the Wales TUC can't filter out nominations from affiliated unions, can it? It basically nominates all of those that are presented by the affiliated unions. Is my understanding correct?

So, in terms of unions affiliated to them?

Yes.

So, I think, yes, as Neil said, basically there would be an expectation that the nominations wouldn't just be in respect of those trade unions that are currently affiliated to the Wales TUC. I think, in the process of this legislation and this Bill, there will be a duty on all social partners to meet the expectations of the legislation and do that in a way that is representative as well. As I said, the First Minister retains that discretion to, essentially, ask any of the nominating bodies and nominated representatives, if it wasn't representative, to give a reason, to go back and to seek an alternative to ensure that there was that diversity of representation on there.

Lovely. Thank you. I'll just swiftly move on to section 6 of the Bill. Given that the council may only meet nine times during a three-year period, do you think that it is sufficient for members to develop expertise and to deliver progress in areas covered by the Bill if they're only appointed for three years?

And a bit of a technical question that perhaps the lawyers could answer: for a public appointments process of this type, would Ministers, or, in this case, the First Minister, be able to appoint for a greater period than three years, or is it the case that the proposal for a three-year period brings into line appointments to the council with those appointments elsewhere, such as chair of boards and presidents of boards?

Thanks. You touched on your own answer there, I think, a little bit, in terms of these being public appointments, ultimately, and the majority of public appointments in Wales usually run for between three and four years. So, the social partnership council has reflected that and adopted that similar duration of time. And, of course, members can be reappointed after that term, so there's the opportunity there to continue to with that to maintain that stability of knowledge as we move forward. But you probably would anticipate and expect, going back to what you said previously, in terms of making sure that there is that different representation, those different voices and those experiences round the council table, members to be appointed because they already bring a range of relevant knowledge and expertise that they've already acquired in their relevant fields or their relevant bodies of representation.

Thanks, Minister—

Sorry, Ken, if I may, I think Neil just wanted to come in.

Just a very minor point to say we've made certain assumptions, obviously, in trying to put together the regulatory impact assessment of the cost, and one of those assumptions is about the frequency of meetings of the social partnership council. So, we have had a stab at three meetings per year as a reasonable guess. That's the rough frequency with which the workforce partnership council has been meeting over the last several years. But, of course, the shadow social partnership council, in dealing with the pandemic, has been meeting every three weeks. So, in part, the frequency of meetings and the number of meetings per year, I suspect, will be driven by the business of the social partnership council when it's up and running.

That's good to hear. Thank you.

I'm just going to ask about diversity now. The draft Bill consultation said that diversity requirements for membership of the council may be set out in its terms of reference. Can you confirm whether you intend to do this and, if so, can you set out which diversity requirements you're currently considering?

So, it's our intention that social partnership council appointments should, obviously, take into account both diversity and considerations around inclusion, and this will be made clear to nominating bodies. This time, we haven't specified the requirements for social partnership council appointments, but this, clearly, is something we would want to work with social partners to develop and set that out ahead of that process beginning.

Lovely, thank you. I can see Jane has raised her hand. Jane.

Okay. Jane.

The Chair may have spotted this, but Zain wanted to make a point, I understand, in relation to Ken's points, and we haven't heard from him yet. It would be good to hear your perspective, Zain, as well. If that's all right, Chair. Thank you.

Thank you, Jane, and good afternoon, everyone. In relation to the previous point about members building up expertise and membership during their three-year period on the SPC, just to say as well that, during that period, sub-groups will also be created and, depending on the sub-group and area of subject covered by sub-groups, SPC members can be part of the sub-groups as well, so they can develop additional expertise. So, like Neil mentioned earlier, for the RIA, on the frequency of meetings, we've assumed that there will be three sub-groups—one we know will definitely be the public procurement sub-group—and, for the purpose of the RIA, we said these sub-groups would meet three times a year, as well. So, if you imagine that as nine extra meetings that some SPC members will be part of, that's an additional way in which they can build up their expertise as well.

Also, if I may, on the current question just asked about diversity and inclusion, the legislation states that procedures for the SPC must be published within six months of the relevant subsection coming into force. So, within the procedures, we will want, as the Minister said, to be discussing with our social partners to consider what sort of diversity and inclusion requirements we want to include, as well as other things for public appointment. So, of course, as with all public appointments, we want membership to be as diverse as it can be, so we'll definitely be taking it into consideration when we publish our procedures.

Before you go on, Ken, I think Peredur wanted to come in.

Just a quick one. Have you given any consideration to term limits at all?

Term limits on membership?

Membership.

So, how many times people can re-stand.

So, you can be re-appointed by the First Minister, but how many times could you be re-appointed?

We would expect these appointments to be run on a similar fashion to other public appointments, so an appointment for a set term, with the possibility of re-appointment for another term, but not exceeding—. I think the limit is 10 years altogether. I think that's the established—

That's not in the Bill. 

It's not in the Bill, but that is the established procedure for public appointments. There's no reason, I suppose, why we couldn't make it part of the Bill.

Okay. Back to you, Ken. 

Thank you. I want to move on now to the social partnership duty, and in the draft Bill consultation a number of local authorities said that they felt there was no need for a social partnership duty, as this would have no significant effect on their existing engagement with trade unions. Can you explain how you expect this duty to change the way that public sector employers and worker representatives interact?

There are already many established social partnership arrangements in Wales across public bodies, some of which actually predate devolution, and I think it's important that we make clear that we're not necessarily proposing that these existing arrangements should be replaced, more that we're seeking to build upon them, and strengthen and extend social partnership to make sure it's core to the way in which public bodies operate, particularly in pursuit of the well-being goals. I think what we're seeking to do in this legislation is to formalise and strengthen existing arrangements as opposed to—. We're not seeking to replace them, many of which might be known through other terms and operate on a bipartite level at the moment. And also, perhaps, it's essentially to promote a greater consistency of approach from public body to public body, and we also believe that the effectiveness of these social partnership arrangements can be strengthened by the statutory underpinning, because I think the social partnership duty probably goes further in terms of what existing arrangements will be in place, with the duty to seek—I'll get it the right way round—consensus and compromise. It goes a lot further than just to simply 'engage', or to 'work with', or to 'consult'—so, actually to make it a lot more meaningful, and I think, in doing this, and the guidance that comes alongside it, we can be more explicit about what social partnership means in Wales, and set out those principles and expectations regarding the approach, and the shared commitments required from all partners. So, at the same time as building on what's already there, it's seeking to provide greater clarity on what the expectations would be from partners from all perspectives of the social partnership movement. 

Okay, thank you. And can you give any practical examples of when you might consider the social partnership duty would have assisted public bodies and trade unions to have achieved a better outcome when setting well-being goals or, indeed, making strategic decisions to take steps to achieve these?

So, I think it might be helpful, first of all, to just refer back to some things in my opening remarks to the first question from the Chair, in terms of there being already many examples of social partnership working in operation and, particularly during the coronavirus pandemic, the value and importance, and actually the difference that can make in terms of what we're trying to achieve, not just in terms of the advice to Government in terms of policy, but actually having that kind of flexibility to come back and make sure things actually work in practice as well as on that policy level. You get presented, as a Minister, with a policy on paper, but actually that social partnership working, particularly during the pandemic, and being able to be agile and work flexibly, has actually enabled us to achieve more practical outcomes.

We've talked about the shadow social partnership council. In that space, we also put in a health and safety forum that enabled us to bring social partners together, both in devolved and non-devolved areas, to look at really pressing issues that were really important and very fluid during the coronavirus pandemic, and it enabled us to more effectively manage and respond to the emergency of the COVID-19 pandemic.

And I think just one more, before I go back to the initial question, is the Wales social care fair work forum. That's been absolutely instrumental and at the forefront of informing our approach to achieving that programme for government commitment around a real living wage for social care workers, but also in terms of actually looking at those well-documented and well-known challenges across the sector as a whole in order to sustain it into the future. So, I think there are examples there of how, actually, that social partnership working starts to deliver outcomes, but actually is the right process, because it brings those different experiences, skills and advice around the table.

In terms of how it could help public bodies, you're looking at a public body in terms of setting and delivering their well-being objectives, then to involve the people who are involved with providing those services and shaping how that should look. I think many of us as Members will have had conversations with public sector workers who have ideas on how actually we can improve the delivery of public services. So, I think I would say that the real value will be in the legislation in terms of the people who are behind providing those services not only being able to shape the delivery of them but also to actually improve the well-being of the people who are behind the services as well. 

And just finally from me, Chair, just a very straightforward question: why have you decided to have a separate duty for Ministers in the Bill?

The Welsh Ministers' duty in setting well-being objectives is already different to other public bodies in the Well-being of Future Generations (Wales) Act 2015 anyway. As you'll be familiar with, our duty to set objectives is triggered following a Senedd election. So, essentially, Welsh Ministers set our well-being objectives following a democratic process tied to national elections, manifesto promises and then that's set out in the programme for government. So, essentially, those well-being objectives by an incoming Government will reflect many of those manifesto commitments already made and voted on. To do otherwise would obviously undermine the democratic process. That's why, recognising that, the duty on Welsh Ministers will be around consulting the social partnership council in the delivery of those objectives instead. 

Thank you, Minister. Thanks, Chair. That's all from me. 

Thank you. Can we now go back to Sarah Murphy, who wanted to pursue the issue of fair work?

Yes, that was a good question to come in on now. The question is: the draft Bill included a fair work duty on Welsh Ministers, to set fair work objectives, to take steps to achieve these and then to report back annually on the progress. For what reasons have these proposals not been included in the Bill introduced into the Senedd, please?

Thanks, Sarah. You're right, the approach in the Bill as published now differs from how it was set out in the draft Bill, which we consulted on prior to the Senedd elections in 2021, which feels like an age ago now. But, one of the things I would say, and I'm really keen to stress this, is that the approach to fair work we've adopted in the Bill now as published actually gives us a wider reach in terms of public bodies covered by a fair work duty, whereas as things were previously proposed, it would have been a standalone duty on Welsh Ministers alone. I think that might touch on some of the other things we've raised previously during the course of this session. So, ensuring the wider reach is really, really important. It would mean all public bodies are subject to the well-being of future generations Act, including Welsh Ministers, that we will all need to consider fair work when pursuing well-being objectives in general and, more specifically, with the 'a prosperous Wales' goal. 

One of the conversations we've had with—well, there's ongoing dialogue; obviously, all of this is being produced and developed in social partnership, working with social partners and broader stakeholders as well. And it goes back—again, we've talked about clarity and consistency, and one of the things that has been raised with us is around the use of different terms to cover similar or overlapping activity. So, 'decent work' and 'fair work'. This consistency in terminology is welcomed. 

As Neil said previously, the Bill as presented respects and reflects the limits of the current devolution settlement. So, in relation to replicating the fair work duty, the eagle-eyed amongst you will recall that, in the draft Bill, the definition of 'fair work' was actually left blank and we sought to seek input from consultation respondees and partners as to actually how we could make that work within the constraints that we were operating within. But we think actually that our approach now better reflects our belief that promoting fair work can support the link between individual and collective well-being, it reflects the important role that Welsh public bodies have in leading by example, and it also goes some way, which is important, on the recommendation that was actually made by the Fair Work Commission to incorporate fair work into the well-being of future generations Act. So, that goes back again to aligning that approach, and we think it's more aligned to the thinking of the standalone duty that's already proposed in the Bill. 

So, in summary, the way we've gone about it and where we've landed is that we've got a position that we've arrived at that is probably an improvement on what was proposed in the draft Bill, because it captures public bodies and not just Welsh Ministers, and it makes that more explicit link between fair work and well-being. And also, going back to what you were saying about consistently dovetailing reporting, it doesn't introduce separate reporting requirements over and above those required by the well-being of future generations Act. 

Thank you very much. And also—you touched on this a little bit earlier on, so it's good to ask this now as well—the Bill amends the well-being of future generations Act so that public bodies covered by that Act are required to consider fair work, pursuing the 'a prosperous Wales' well-being goal. So, how will public bodies need to demonstrate that they are sufficiently considering fair work in this way, and what guidance are you considering giving them to assist in doing this? 

Ultimately, it will be for public bodies as employers themselves to work with their trade unions or other representatives of their staff, as set out in the duty, in agreeing what further steps and progress can be made in relation to fair work as part of the pursuit of the well-being objectives. Those actions may differ by specific body, just because of the statutory functions they may have, the challenges they may be facing, or the opportunities they feel are the priorities to pursue.

You touched, I think, at the end of your question there on guidance, Sarah. It is the intention to produce guidance and advice on how organisations can think about fair work effectively in the context of developing those objectives, and fair work as part of that. There are things you would probably suggest yourself that public bodies could do in considering these sorts of things: the process of adopting and being accredited from the Living Wage Foundation; looking at under-representation; improving the training offer to workers and wider opportunities for growth and development. 

Something that's very topical at the moment, and has been for the last year or so, is looking at how fair work encapsulates allowing, enhancing and enabling workers to work more flexibly and remotely, so taking worker-centred approaches to job design that improve not only work-life balance, but actually well-being as well. 

Brilliant. Thank you ever so much. Thank you, Chair.

Thank you. We're now going to move on to look at the second part of the Bill in relation to procurement. Peredur is going to start us off. 

Thank you, Chair. The explanatory memorandum sets out six aims for the public procurement elements of the Bill. Fundamental to all of those is the data that's collected and how that then helps to produce objectives, and then, from your point of view, being able to potentially set targets as to how well we're doing. The number of 52 per cent of public procurement is bandied around; however accurate that reporting is, that's key to it all. Obviously, we've had conversations in the Chamber around where that target should be set, but how will measuring performance come into it, and how are your thoughts developing around the objectives and collecting the data? I think in the Bill itself there's no mention of collecting the addresses or the locale of contracts, and things like that. So, could you give us some thoughts around that? 

If I just speak more broadly and perhaps bring Sue in on some of the more specific points you raised towards the end there. Obviously, the broad purpose of the socially responsible procurement duty is to ensure that public bodies take action to improve economic, social cultural and environmental well-being whenever they are carrying out procurement and managing public contracts. The other duties come from that; so, around setting objectives, publishing the strategies, annual reports, pursuing outcomes through supply chains. So, it's all about strengthening that process and making it much more transparent as well.

The annual reporting process is a really key aspect of that, along with the oversight of the procurement sub-group. That will actually be one of the ways, in terms of mechanisms, that is actually helping us present a much clearer picture about what is happening and to what extent the duties are making a difference and giving us that platform to build on in a direction, Peredur, that we've discussed previously in the Chamber and outside it. Relevant data can be collected through that process and enable us to assess over time whether we are making progress. If I just bring Sue in a little bit more on the questions around data and capture.

There's still a lot to develop around what data we would want to collect. The plan is to have discussions with the procurement community around what data they currently capture, where some of the key gaps are, and where we could develop that, I guess. You've picked up on one area around where organisations are based, in a way that we can look at where the expenditure is happening, its location, and that's something certainly that we will be looking to make sure that we do collect improved data on. There are some weaknesses in the data collection in that area at the moment. But, there's also an opportunity for us to look right across the well-being goals and see if there are areas where we could more consistently capture data around carbon reduction, around other environmental matters to do with waste or circularity, climate resilience, things around employment as well. There is a whole raft of areas that would really contribute towards us being able to monitor progress on our delivery against well-being goals, which are key to this, but all that work remains to be done and we want to do that in a very open and consultative way as we go forward.

So, would you expect, Minister, that when you get the reports and lay the report before the Senedd, the data would be part of that report, and that you'd be wanting then to have a debate on those reports? What are your thoughts on the, 'So what?' The report being laid—well, what do we do with that as a Senedd?

We would anticipate data would be part of that, and that would also go to the procurement sub-group but also the social partnership council to provide advice and make recommendations as well. That would give us an opportunity then to bring it to the floor of the Senedd to look at the data to actually provide that greater level of transparency and accountability as well, in that way. We're talking about social partnership and working collaboratively, so I would anticipate there would be opportunities outside that to actually work together to see how we can seek to build on what that data is showing us and what we can learn from it, and we can learn, hopefully, from some best practice too about how that can be spread and shared across public bodies and those bodies captured by the procurement duties.

Thank you. Just finally from me, the explanatory memorandum highlights the existing non-statutory guidance currently in place to seek to deliver aspects of socially responsible public procurement—that's hard to say—but can you set out why you believe this approach is insufficient to deliver your objectives and why you've chosen to use a legislative approach for this part of the Bill?

You're right, this is a different approach to the one we've taken before. It's the first time, I believe, we have legislated in a Welsh context on procurement. I think we discussed previously there have been numerous reports into procurement from the Wales audit office, we talked about the review from the future generations commissioner, and, like you say, they all identified where there is evidence of good practice, but there's obviously room for further improvement. To get that more consistent practice, legislation offers us the levers and the means to do that in a more consistent, coherent way, and also recognising that there's a significant gap in the way that contracts are managed. The contract management duties part of the Bill will also increase that due diligence, that transparency in pursuit of those socially responsible outcomes through supply chains, particularly in the construction sector. Have you got anything to add there, Sue?

When we were looking at developing these duties and thinking about them, our attention was drawn to what the Scottish Government had done over a period of time. They transposed the previous EU regulations directly into law in Scotland. As part of that, they included a sustainable procurement duty, which has some similar features, because we're looking at its operation. And members of this committee might be interested to know that they do produce an annual report and it has got some data in there, infographics and data in there, so you can look over a period of time and see how those figures are moving. What they haven't put in place so much in their legislation so far, but what we have in this Bill, is a system where that links into the process of accountability and scrutiny, and through the procurement sub-group and the SPC, and then the opportunity for that to be discussed here as well.

So, I think what we've done is looked at something that's got more than we've got at the moment, and then thought about how we might develop that further. And, certainly, on the data side, data is absolutely key to this, and it will be really important to make sure we collect the right data because, if you don't, sometimes it can have perverse incentives, can't it, collecting data, and then, everybody works towards chasing a particular number. So, that is going to be a really important part to get right.

So, it's what gets measured gets done, type of thing, and what we need to make sure of is that we know what needs to be done so that we can collect the right data. Thank you, Chair.

Thanks. Okay, sticking with Scotland then, I'm interested in, obviously, the sustainable procurement duty that was passed in Scotland in 2014, in relation in particular to the procurement of school food, which is obviously high on our agenda at the moment. So, what analysis have you done on the progress that Scotland has undoubtedly made in ensuring that they have more local, fresh food procured by schools? How much has that been down to the legislation or down to policy objectives, like meeting carbon emission reductions and serving up fresh food?

So, the Scottish Government has always transposed EU directives into Scottish law, and, as you referred, the last time they did it was with the sustainable procurement duty. So, I think that my understanding is that the legislation in Scotland doesn't include specific duties relating to contract management, which are important in ensuring socially responsible outcomes, but Sue will be able to expand on that.

So, that's another area in which, I guess, we've gone further than what's in Scottish law, is actually that transparency through the SPC. It's not going to help much on the food point because, of course, we're focusing at the moment particularly on construction and outsourcing services. But, yes, that is an area in which we've built on what the Scottish Government have done. 

In terms of food and the extent to which it's either policy or it's to do with the legislative process, I imagine it's a mixture of both. And what analysis have we done? I've got to be honest and say that I haven't done any particular analysis and looked at that particularly. And, also, I guess we could ask our colleagues on the procurement policy side, who have been working in this area, and people who are working in the foundational economy area, particularly on food procurement at the moment, to provide this committee with more information about that.

Okay. That would be useful, I think, if we could do that. If we can move on now to other aspects of the procurement side of it. Jane Dodds is going to come in. Jane.

Thank you, Chair. I have actually asked some of the questions that I wanted to ask at the beginning. So, I just wondered if I could talk about one aspect that I touched on in the earlier session, which was about the construction industry. And one of the areas that you talk about there is about outsourcing and contracts. And, again, I'd be really interested in knowing a little bit more detail here around outsourcing, and how you will engineer the scrutiny of that and the monitoring of that. Thank you, Chair.

Thanks, Jane. So, you're right, the Bill, as it stands, specifically sets out the contract management duties in relation to larger construction contracts and also the outsourcing of public services. If I touch on the outsourcing of public services first, and then perhaps also around the construction contracts as well. So, the case about services—. I'm getting tongue-tied now, Peredur, as well. In the case of outsourcing services contracts, there's evidence that the current two-tier code is not always protecting workforce terms over the longer term. And if you look back, the code was in 2014, so it's in need of a review and relaunch. 

As things stand, currently—. So, this creates greater transparency and accountability, and I know that Sue will be happy to expand on it shortly. But in both the cases of contract management in construction and outsourcing, there will be upfront notification duties, in both the areas, to ensure that they're given proper consideration before a contract is advertised. Because as is currently the case, it will be done retrospectively, so, actually, it allows that notification exception to come to the social partnership council and Welsh Ministers prior to advertisation, so they have to report on that. So, it adds that extra level of transparency and accountability in order to drive those social outcomes that I'd hope we'd all want to see. But, Sue, I think you'd need to expand on that.

That touches on most of it, really. I think that one of the things, certainly when it comes to outsourcing services contracts, is that under the current code, which is guidance but is applied across much of the public sector, as the Minister said, you have to report at the end of the year about how it's been applied. And that's missing an opportunity, really, for having those discussions before a contract is advertised. Once it is advertised, it's really very difficult with some of these lengthy deals to go back and change any of that further down the line. So, it provides that important checkpoint at the beginning. And I think that, also, one of the things that changed in this version of the Bill, compared to the draft one, was a strengthening of the requirements about transparency of the outcome of those processes. So, the duty isn't that you have to apply the contract terms, because there may be good reasons in some cases where they can't be applied, but you have to inform Welsh Ministers if you're not going to, and then, whatever is then decided with that, the outcome of that needs to be made public, which is a really important transparency point about—. These are really important things that we're trying to do: protect workers' terms and conditions over time, and, in the case of the construction duties, ensure that really important things are delivered through supply chains. And it's important that, if organisations, public bodies, are not applying these duties for whatever reason, there is some sort of public accountability on that. And that's the thinking that's gone into this section of the Bill.

Chair, may I continue?

Yes.

Thank you. I do have another question, but I just really wanted to follow up on that last point, if I may. My understanding is that, what you seem to be saying is that, if there is a choice or a decision made that you don't apply those particular requirements in terms of the outsourcing to public bodies, then there is a process by which Ministers need to be notified. Could you just explain a little bit more about that? Sorry, I may be misunderstanding you.

You're right, there is a process.

Would you like me to—

Yes, please.

Thank you, Minister. So, the process is that you have to notify Welsh Ministers in advance, preferably, I think, of advertising that contract. And then, those reasons would be considered, and they may be considered in some detail, and there may be a need to go back for further information to understand those reasons. There is also provision for potentially using the sub-group of the social partnership council if they have specific expertise in those areas. And that process will—. The plan would be that you'd go through it fairly quickly, in order that a decision could made about whether those reasons are good enough, to be made in time before that is advertised. Some of our public sector colleagues are concerned that that might delay the start of a procurement, but the intention is to go through that process fairly quickly.

And I guess the main intention is that it will require public bodies to think about these things, where they may not have been aware of it or thought about it. And so, hopefully, there are no notifications, and, actually, these contract clauses are always included and are already applied. But there may be some reasons, particularly in the early stages, thinking about the construction ones, where public bodies may need to use a framework contract or something, which hasn't been set up with some of these clauses in it, just because of the timing, and so, it may be that there's a timing reason towards the beginning where that would be difficult. That's just one example, but there may be many others. We define a major construction contract and that covers an awfully wide variety of different types of projects, and we'd need to—. There may be reasons. I couldn't second guess what those would be, but that's the process that would be gone through. And, at the end of the process, there is an opportunity for Ministers to issue a direction, potentially, which is the kind of strongest bit in the whole Bill really.

Thank you. My final point does relate to those model clauses. I thought that point was very interesting. Do you have a timescale of when you'd be able to produce those model clauses? And would it be something that the committee would be able to have a look at, particularly in Stage 1 of the Bill?

The work is starting on the development of those model clauses. We're not yet in a position to share those examples, but we obviously recognise it's absolutely imperative that we engage not just with social partners, but a whole range of stakeholders, in order to take the time to develop not just a really good set of clauses, but one that is both workable and challenging as well. So, whilst I can't give a time frame today, we'd be willing to perhaps follow up with the committee in terms of what sort of time frame we're looking at, and, of course, would be happy to share with the committee, when we are in that position to do so.

Thank you, Chair. Thank you, Minister.

You're looking puzzled. Do you need to come in very quickly? 

Just very quickly, on contract extensions. So, if there was a first, second, third stage and the first stage happened before this Bill was enacted, afterwards, would this Bill apply to those contracts?

I'm not sure about that. I don't think it would, and that might then become one of the reasons why—. Would it apply? And, if it did apply, would that be a reason for not including the clauses? There are all sorts of possible complexities like that, which I think we need to think through, and is one of the reasons why we can't, I don't think, do this piece of work very quickly. One of the other reasons why it's going to take some time is that a lot of what we're talking about, in terms of good practice generally on socially responsible procurement, is there; it just needs to be drawn together and made more consistent and presented in a more helpful way. A lot of what we're talking about here really doesn't exist, and you talk to the construction industry and those types of clauses and that way of monitoring through supply chains is not something that they're doing at the moment. So, with it being so new, we will need to take some time to make sure we develop something that's really good, in consultation with those it's going to affect.

Well, in the light of Grenfell Tower, obviously these are really important matters.

Would you retrospectively go back to the beginning of a contract on something? It opens a can of worms, but, anyway, sorry. 

Yes, it does indeed. Okay, we'll come back to that and, obviously, if you can provide us with some written information, that would be great. Joel James, you were going to—[Inaudible.]

Thank you, Chair, and thanks, everyone, for coming today. I suppose the last couple of questions I'd like to ask are about the accountability and enforcement in relation to public procurement, but then also implementing the Bill and scrutinising it afterwards. So, I suppose, I'd better start with that one first. I just wanted to get some idea about how the success or failure of this Bill will be measured, and I was just wondering what your views are on that.

Thanks, Joel. So, in terms of accountability, we've got measuring the legislation and there's a number of different aspects to it. So, we've touched on the social partnership council in that their reports will be published and that will be very clear and accountable, in terms of being able to measure that, because I know we commit to an ongoing process of reviewing the implementation and learning from that as well. And then obviously you've got—. I think the way that you analyse or measure that success is around the transparency that the legislation allows us around the social partnership duty, and the publishing of the objectives and the delivery of them, around the transparency of this. I'm saying 'transparency' a lot, but it is a really key component of this legislation, and what can give us the leverage to really make a difference in terms of those outcomes from the legislation that we would all collectively want to see, whether that's around fair work or supporting SMEs in local communities as well. So, Neil, do you want to pick up on any aspects of that?

Perhaps, just in relation to the evaluation framework. Obviously, we've put a lot of work and thought into how we would evaluate the overall impact of this legislation, should it be made law, and we have created, therefore, a five-year evaluation, probably a mid-term evaluation as well. So, a process and a final evaluative look at what impact the Bill has had on the ground, because I think that's more important. There's a relatively easy measure that we could adopt in terms of has the Bill been a success. Well, as I hinted at earlier: has the SPC met and has it provided advice, ticking both boxes—job done? No. So, what we're looking at is a formative evaluation, and then at the end of it a summative evaluation, which tells us, over that five-year period, what real impact the Bill has had, both in terms of those processes, how well they've bedded in, but also what real difference it's made to the setting and delivery of well-being objectives, what real difference it's made to the way in which public bodies in Wales work with their worker representatives in terms of their strategic decision making and whether that has made a discernible difference in terms of the services that all of us rely upon. So, the framework is there. We have a logic model underpinning it, which I hope is robust, and our knowledge and analytical services department has put a lot of work into helping us build and shape that. So, I'm pretty confident we've got something that is quite robust in terms of the overall evaluation framework.

Perfect. Thank you for that. One of the reasons why I asked that question was because last week we all received a joint letter off the future generations commissioner, Size of Wales, and then the Youth Climate Ambassadors for Wales. One of the points that they highlighted there was that implementation of procurement policy, and I quote, is 'patchy at best'. I just wanted to get some idea about how this Bill will be different to existing legislation in trying to patch that patchiness up, if that makes sense. It just seems—. And again, I mentioned it earlier; when I meet community groups, organisations and everything, one thing that keeps coming back to me is that the policy is there but there is just no implementation of it. There is no guidance, there's no funding, and I just wanted to get some idea of that, if that's okay.

Thanks, Joel, and thanks for that question. Just breaking it down into different aspects, the first point I think you touched on was how is this legislation different. Well, I think the first point is that it's the first time we've legislated, and one of the reasons to do that is to address some of things that that letter and other reviews, as we've said, have raised, around how there is good practice out there, but, like you say, it's not necessarily consistent and there's inconsistency in how things have applied. So, I think that's one of the reasons behind legislating, to try and drive that better level of consistency.

But also you're right to address the points around that you can have good policy, but it is then how people are able to interpret that and implement in practice to really make the difference that we would want to see—so, around the legislation, the implementation we're giving to the development of our statutory guidance. So, social partners, a range of stakeholders, have been invited to contribute to that development. So, not only is the legislation produced in social partnership, but we've taken that approach around the guidance. We want to make sure, like you say, that that guidance is not just something that's been worked up in a room in Cathays Park; it's been done in genuine partnership to make sure we have got the best support and guidance available there for public bodies, and also there will be things for suppliers via Business Wales.

And I think, perhaps, one thing to touch on—. And I don't know whether Sue has already done it, but one of the reasons why at this stage we've only included specific duties for contract management in relation to construction and outsourcing services, is, obviously, we've given the reasons around the challenges in those particular areas, but actually the need that we also need to recognise proportionality and recognise, be realistic, about capacity among procurement and contract management staff, so, do things in a measured and a right way to not only have the outcomes we want but to create those outcomes that we can then hopefully learn from and spread elsewhere as well.

Perfect, thank you for that—

Sorry, Joel. I think Neil just wanted to come in.

I didn't want to cut across your next question, sorry. I simply wanted to say that I suspect that letter may have come, in part, off the back of a meeting that I and a couple of colleagues had with the very same group of stakeholders earlier last week. They were keen to talk to us about the potential for this legislation to support our ambitions with regard to global responsibility, deforestation, all of the things that you would expect. So, we had a very—well, I thought a very—useful and interesting conversation, and we've committed to continuing that, but I did say at that point that, in terms of submitting evidence and thinking how this Bill might be reshaped or improved, clearly they need to engage with elected Members on that, and I'm glad to hear they've done so. I think that whole conversation is indicative of a much broader set of conversations that we've been having in the formulation of this Bill. Because this Bill—. I have worked on other legislation before. I've never worked on legislation that's been developed in partnership with external stakeholders before in quite this way. So, we have worked on all of this with social partners, and I think it is a very different Bill, actually, from that which it would have been, had—as the Minister said—we locked ourselves away as civil servants in Cathays Park. So, we've been through a process of co-production with this Bill. Certainly, my ambition is to continue in that vein in terms of the statutory guidance, all of the supporting materials that will be needed. I think we will make a much better fist of this if we work as closely as we can with stakeholders and interested parties, particularly social partners, in implementing this piece of legislation.

Joel, I've got Sue wanting to come in, if that's okay.

Oh, yes.

Do you mind if I just make one quick comment? I think, just in relation to your question about there's a lot of guidance out there at the moment, just from my perspective, working amongst those people who have to make sense of that guidance, there's an awful lot of overlap. So, within community benefits, it doesn't just touch on impacts on local schools or in local communities, it also touches on some of the environmental factors as well. And then we have a code of practice on ethical employment, which touches on a range of things, including the real living wage, and then we have another piece of information which deals with fair work or real living wage. The way that gets translated down to people working on the ground in procurement is a long list of things they need to consider, and each of those things overlaps with the previous one and can be quite confusing. So, we have an opportunity here to plough a way through all of that, to work, obviously, with the Government's priorities, in terms of what are those priorities, but, hopefully, we'll be able to plough through that and provide a simple way so people can see what the priorities are and which bits of the guidance will be particularly useful for them. And that will reduce, I think, some of the lack of focus that means that nothing really gets really done properly, because everyone is trying to do everything all the time. So, that's one of the things that we can achieve—not on the face of the Bill itself, but through the process by which we develop guidance.

And just very quickly again, if I may, a few years ago, I worked on something called a supplier qualification information database, which was a way of dealing with the fact that lots of public bodies across Wales have slightly different questionnaires that they send out to businesses when they're going through the procurement process. And we did that piece of work really collaboratively; we travelled all around Wales—in person, back then—looking at the questions that people ask in different categories and finding out why they ask the question, what they do with the answer, and we narrowed that list of questions down and we ended up with something that has been in very widespread use across Wales, partly because it simplified stuff, and also because it was done together, so there is a collective ownership of that. So, I think it would be great if we could develop the guidance and some of the stuff in this Bill along those same lines, involving people who are actually going to have to use it.

Perfect. How long do I have, Chair?

Well, we have actually ran out of time, unless the Minister is prepared to give us a couple of extra minutes.

Yes.

Perfect.

If you could just bear in mind that Jane Dodds wanted to come in.

Oh, yes. Okay, sorry, Jane. And thanks ever so much for extending your time. So, I suppose I'd best crack on with some of the questions I want, then, in terms of that the Bill sets out steps that the Welsh Government can take in terms of ensuring that the contracting authorities comply with the provision. So, obviously, you can give a direction from the Government, but what other steps can the Welsh Government do? But also, firstly, what steps can other people in that chain take, then—so, the contracting authorities can take—if they're unhappy with the process?

And I know I've mentioned this in the Chamber before about—and I think Sarah mentioned it as well—the trade unions having power there, but I think one of the concerns that has been expressed is, for example, say like a local authority is in negotiations with refuse collectors about increasing wages and everything, so there is a concern there, then, if they're then also involved in the procurement process, they can hold up that process in order to meet the demand. I just wanted to get some idea there, really, in a sense of, if some people in that chain are thinking that's being taken advantage of, if that make sense.

So, I think, to be clear at the outset, what we're setting out through this legislation is very separate and distinct to any kind of pay negotiations that may take place separately at a local authority or whatever public body level. That is not something that this Bill seeks to do, nor could it seek to do, and we're very clear that, when we say social partnership, it is equal representation for all those partners. So, it's very distinct and separate, and it would be—. So, it wouldn't be within a—. If you're talking about procurement in particular—and I might bring Neil in in a second—the socially responsible procurement duty would be for the public body to implement. No, sorry, socially responsible procurement is separate from the social partnership duty, so these things are very distinct and separate. It might be helpful if we were to set out some of that for the committee to give you that reassurance that it is very distinct and separate and where and how far that extends.

And just to go back, in terms of the point that you made at the outset, I think, Joel, was around how we make things happen and how we encourage things, it goes back to what we've said quite a few times now, over the course of this afternoon, that the main mechanism here is transparency. And actually, this version of the Bill, as opposed to the draft Bill that was consulted on prior to the Senedd elections, is clearer that the outcome of any notification about the non-inclusion of clauses will be made public. And so then another important part of that, as we've said, is the ongoing monitoring of outsourcing and major construction procurements to ensure that the clauses are actually being used and managed. I don't know whether Neil or Sue want to come in—I know the time, Chair—very briefly on any of that.

Just very briefly to say that that's—. One of the reasons for restricting what we're putting in the contract clauses is that, actually, we need to be able to—. We're relying on organisations telling us that they're not doing stuff, but we also need to go and check that they are as well. So, if we were looking across the whole breadth of contracts, we wouldn't be able to do that, but focusing on one particular sector will allow us to have that view on how things are being done as well. So, yes, transparency is definitely the main mechanism. 

Perfect. Well, that leads me on to the next question, then. You mentioned that you're relying on authorities to tell you what they're doing and then sometimes you've got to go out and check them. What circumstances or situations can you see, yourself, where that wouldn't be needing to be done?

Well, I guess, looking particularly at the construction contract management duties—. But there may be other areas. For example, if, as part of the broad social partnership duty, there's a real focus, which I'm sure there will be, around decarbonisation, it would be a case of doing a particular investigation into that application of that particular part of the duty as part of the ongoing scrutiny by the sub-group and the SPC and how that would then underpin it in those annual reports. So, it's not just those construction duties; there will be clear things that organisations have to do in relation to the broader duties on the Bill as well.

Okay. Well, I think we'll pursue them further when we're taking evidence. Jane, is there something, very quickly, that you wanted to ask?

Yes. Thank you, Chair. This may be a very quick 'yes'/'no' answer. Minister, do you anticipate bringing back statements or debates on the Bill to the Senedd? Will that be something that you're programming in in terms of the Bill? Thank you.

Yes—there you go. [Laughter.]

Thank you. Very good. Fine. Thank you very much indeed, Minister, for your attendance, along with your officials. We will, obviously, send you a transcript of your contributions, which you can correct if we've captured them wrongly.

This is obviously the first of many sessions on this really important issue, and we look forward to probing further the objectives and the outcomes of this Bill. So, thank you very much indeed.

I wonder if I could ask Members to agree that, in accordance with Standing Order 17.42, the committee resolves to meet in private for the final item of today's meeting.