National Assembly for Wales

Diolch yn fawr. 

Bore da. I have a few general questions about the review and, in particular, the process at this stage, rather than the precise details of the review and its findings. Just perhaps in summary, what is your view of the way the process was conducted, the way the review was carried out, and the outcome of that review? And, in general, with regard to its findings, perhaps you can summarise your general approach to that. 

Diolch yn fawr. Mick.

So, with that sort of response, the consideration of the various recommendations and findings, the process that might now kick in in order to go through those recommendations and look at ways of implementing them, or engaging further on them, I'm just wondering whether you have a sort of timetable within which that will happen, where you'll really work to try and achieve a conclusion to most of the action points that arise out of it.

Thank you. I've actually developed an action plan, which will be adopted by the board of trustees in a fortnight's time. I foresee that most of the recommendations will have been addressed by next April, by the end of this financial year. Having said that, many, many of the most important recommendations are absolutely dependent on the level of funding from Welsh Government. So, the success of the implementation of the action plan will be absolutely dependent on to what extent Welsh Government have actually addressed recommendation 3 of the report, which is, to the library, the most important recommendation, in that the current financial position of the library and its relationship with Welsh Government is absolutely unsustainable.

Okay. Thank you for that answer. Just one comment on the review is that it doesn't deal with the current COVID pandemic that has hit us, and, of course, I'm just wondering whether there have been issues around that that might impact on the review, the conclusions of the review and also the action plan that you've just referred to.

Actually, since COVID-19 appeared, it's actually strengthened our view as regards taking the national collections, the national library and culture out to the communities of Wales. And apart from this report, we are developing an action plan now in particular as regards the development of the national broadcast archive, which would significantly increase the library's commitment as regards digital and knowledge poverty within our communities. We are quite adamant that if sufficient funds are provided, and to some extent we can do that within the budget we have—. There will be significant costs in our mission to take culture and to assist these communities to recover from this atrocious pandemic. The library has an important role and we are very, very, very eager to make a substantial contribution to the recovery of individuals and communities.

Well, thank you for that comment, and just one final point from me as a general question. You made the point just now, which is really emphasising, I think, a point you made when you gave evidence to committee back in July, that you see the outcome of the negotiations with Government over, I suppose, projects and funding as being absolutely at the core of the library being able to move forward or the alternative being that there'll be a significant impact on jobs and services within the national library itself. That clearly remains your view, I think, as the way forward—that a lot now hinges, or everything really hinges, on the outcome of those discussions with Welsh Government.

Absolutely, absolutely.

Okay. Thank you, Chair. 

Thank you, Mick. John Griffiths.

Diolch yn fawr, Cadeirydd. Bore da. My questions really follow on from Mick's final question and are about the relationship with Welsh Government. Firstly, have you then outlined your suggestions in terms of what is adequate funding for you over the next five years to the Deputy Minister for Culture, Sport and Tourism?

Thank you for your question. With your permission, Chair, I'll ask David Michael—

Of course.

—to answer that question. 

David.

Thank you, Chair. Thank you, John. Yes, we have identified the financial issues that face the library and we have made some projections for the current budget round of how much additional grant in aid we require, firstly in order to avoid the substantial cuts to staff numbers and also to the staff pension scheme, which we'll certainly have to proceed with after Christmas, once we know what the budget is. But we know we need at least an additional £1.5 million in our baseline for revenue to enable us to avoid making these cuts and to proceed with the equivalent pay award that has been made in the civil service.

In terms of capital, we've made a forecast, going forward for the next five years, of what we require for our capital programme. We—[Inaudible.]—to having our capital grant in aid reinstated in the baseline so that we can carry on investing in the building and in our infrastructure, because any business that doesn't invest in its infrastructure is going to fail and so it's absolutely critical we get a sufficient level of capital investment.

In terms of your financial viability, the audit office report in 2016 was followed by comments from the library that change is essential in order to have that financial viability. So, could you tell the committee what changes you've made since 2016 to improve your financial sustainability?

We have been constantly going through a series of assessments of how we can cut our costs, but fundamentally, our grant in aid has flatlined and our wage costs have increased. We have made some pay awards, and to pay for those pay awards, we have to lose staff numbers. So, we're in a position where our grant in aid now is less than it was in 2006, and over that period we've been losing staff, but we're at a point now where we have to make another step change down in staff numbers. We've gone down from nearly 300 to about 225 now, and we're looking at losing another 30 posts in the next 12 months in order to balance the budget. So, there is very little place we can go to actually make any other cuts. That is the situation we're in. We've actually, I think, ran out of options now for making cuts, and these cuts will eventually impact on services to the public. I'll come back to Pedr's point about the tailored review; we can do some of those recommendations by reallocating resources, but fundamentally, if we've got to lose 30 posts, it's going to have a big impact on our ability to deliver. 

I hear, obviously, clearly what you say, David, and what Pedr said earlier. The challenge panel stated, didn't they, that in terms of the way forward, you couldn't plan entirely on the basis that you would get increased funding. And I hear what you say in terms of planning and in terms of potential job losses and the effect on services, but is there any other planning that the library has done in a more constructive way in terms of what you might be able to do if you do not receive that additional Welsh Government funding? 

The only other funding option we have is our private funds. The library has charitable funds that we have invested, and fortunately most of those are unrestricted funds—they don't have any restrictions placed on them by the donors. So, we've just carried out an assessment of—we've got about £12.5 million in private funds—how much of that money we need is available to us. So, we've earmarked £5.5 million of that as an endowed fund for the national broadcast archive. We've identified, to manage risks, that we need about another £4.5 million just as a general reserve for unexpected events, especially in the COVID era. So that totals £10 million. There's about £2.5 million of headroom, if you like, in that, and of that £2.5 million, £1 million is committed to the broadcast archive project as a direct contribution. We've earmarked another £1 million to finance redundancy costs, and the remaining £0.5 million will be there to finance the costs of the projected deficits that we're going to make in the current financial year and the next financial year. So, effectively, we've looked at our reserves and they're all tied up now, and that's why it's critical that we have to—. If we don't get an increase in our grant in aid, we will have to lose 30 posts, we will have to close the staff pension scheme, and we'll end up with a balanced budget at the end of that, but effectively no reserves. It will all be earmarked or used.

Okay. Thanks for that. One further question from me. Back to the challenge panel again, they referred to what they described as traditional tensions between the library and the national museum. I wonder if you could tell the committee what those tensions are and how they might be addressed in your view.

Diolch yn fawr.

Diolch, John. David Melding.

Diolch yn fawr, Gadeirydd. I just want to turn to the governance structure, because the tailored review has quite a long list there of recommendations, but I think it's fair to conclude from what it says that the board of trustees and the relationship between the executive, the senior management team and the board is a very traditional and, one would now say, outdated model of basically advice and scrutiny. So, is that fair? And then, how quickly are you going to act on the modernisation agenda, which really is from skills identification to appraisals to having papers more clearly set out so that the trustees know what decision is being either scrutinised or more effectively made in co-operation with the senior management? So, I think it's fair to say that part of the tailored review is slightly uncomfortable for the national library. It's not proceeded under its own steam to modernise here, and is being urged even to look at best practice in other arm's-length bodies. So, I'd like your reaction to that, Pedr, really.

Thank you for that answer. It is reassuring. Obviously, alarm bells would ring if you were to contest what the review says in this area, and you've obviously evidenced some of the reforms that are now in hand. So, I'm sure we'd all welcome that, particularly the balance, as you said, between the exec and the non-exec parts of the board. The challenge letter—let's do the retrospective thing and just get it out of the way—or the challenge panel, rather, did focus on the whole financial restructuring that followed the austerity measures first adopted in 2010 by the UK Government, and then the knock-on effect for the devolved administrations, and said there was a complete lack of oversight and strategic ownership from the board, and that that may have impacted some of the quality of the very difficult decisions that have been made. But I want to turn it around and just ask what your vision is for the non-exec part of the board in terms of driving and owning and really bringing skills and knowledge to the digital advances that need to be made, after an initially very good start—in fact, world leading 20 years ago. It now needs to get up to that level of excellence again. I think the review and the challenge panel say that. And also in the commercial sector, where an awful lot of work needs to be done, as it does in the national museum—this is just not an area that's traditionally been emphasised as of high priority. So, I just wonder in those two areas how you are going to be seeing the reformed board work and really assist the senior management.

We'll share that answer if we can. Maybe I'll bring David in as regards the financial position.

We've clearly been through a difficult 10 or 15 years on the financial side of things, and, as I said before, we need investment in our business in order for it to succeed. Back in the early 2000s, when we started digitisation seriously, we had big investment from Welsh Government, we were supported and we did make massive strides in the digital provision. Back then we had £850,000 in capital grants each year. That got cut in 2013 to £550,000, and then in 2017 disappeared altogether to zero. So, it's a bit of, 'Which comes first, the cart or the horse?' here. But, actually, we need to get the product delivered, we need to have the resources available to set these operations up, and we are acutely aware that a lot of our infrastructure on the digitalisation side's become dated and it needs investment in technology and systems, and that's why we need the capital resources to put into our business. Does that answer the financial question?

I'm assuming that there will be a reset in the financial situation, and that's why I want to know how the board would then effectively manage or help manage and own and bring insight and skills to the senior team that, in co-operation, will be delivering the digital and commercial growth that we will need to see in the 2020s.

You're frozen, Pedr, sorry.

Diolch, Pedr. Anything further, David?

No, that's fine.

If I can just—

That might be one for you, David, to begin with, perhaps.

Okay. Well, obviously, we have a cafe and a shop and a library and other commercial activities here. We generate—we did generate— about £600,000 a year of commercial income. Most of that has dried up due to COVID and we don't think it's going to return anytime soon. We're looking at the next couple of years, probably, before we'll be able to get some of that back. So, we don't see that there's massive scope in the commercial world. There are some things where we can contract out some of our specialist skills in conservation, but, if we put our conservation staff into that, they're not conserving the library's collection, so there's a bit of a trade-off there.

In terms of other sources of income, Pedr's just mentioned the national broadcast archive. We will, hopefully, be having confirmed a substantial grant from the Heritage Lottery Fund to finance that—nearly £5 million—so that's a massive investment coming in to the library. Also, our private funds—[Interruption.] Our private funds have been used to support the library's activities over the last decade. We have mainly generated those from legacies and gifts that people have left to the library, invested that on the stock market, and we're generating about £300,000 a year of income—effectively profit—from that, which subsidises our activities.

With the commercial activities, basically, all that money gets recycled within commercial activities. So, the cost of providing the shop and the cafe is basically covered by the income. So, it doesn't actually generate a profit for subsidising what the library's true mission is, whereas our private funds—that is all additional services that we can provide from that money.

So, I think that those are the main sources of income: commercial, and then our private funds, and then grants. But our core funding, our core, stable funding, is what we depend on from the Welsh Government, and that is the thing that is critical to our future—having a sustainable settlement through our grant in aid.

Thank you. Carwyn.

Thanks, Helen. Just to come back, to follow on that last question that you asked—perhaps if David could answer—inevitably, the library is going to be funded largely by Government, but, of course, that doesn't mean that there aren't perhaps further opportunities to look at increasing commercial income. Are there any examples of other—if I can use the phrase—copyright libraries, across the UK and beyond, where they have increased their commercial income that perhaps the national library might be able to learn from?

Well, we compare ourselves with other national institutions, in particular the NLS. I think that we are in a fairly similar position to them in terms of the amount of non-Government finance—[Inaudible.]—and get in. We're probably more successful than most institutions in terms of attracting charitable funds and legacies. The British Library is a different animal completely to the two other national libraries. We can't really compare. So, the natural comparator is the NLS, and I think that we stack up reasonably well in terms of commercial performance.

Carwyn.

Carwyn.

I just wanted to pursue that particular point, because at the moment we're going through quite a transformation in Welsh education, Welsh history, the Welsh curriculum and so on, and it seems to me that many of those areas that might feature within the specific aspects of community history and so on we're so keen to develop are actually related to archives already held, and so on. Have there been any discussions or engagement with Welsh Government through that field, through the educational field, of how there might be a specific contribution into that area of Welsh Government educational work?

I'm glad you asked that question, Mick. It's a very, very important question, particularly in the context of the new curriculum. We believe the national library, with its collections, has a huge contribution to make to teaching and to the national curriculum in Wales, and I believe the reviewers make that point pretty strongly. There has been no connection at all, no communication at all, between the library and education officials in Welsh Government. As you know too well, we work within the culture section, and we would really, really welcome a discussion to amplify to the education Minister the contribution the national library could make to assist the delivery of bilingual material that would assist teachers, pupils and institutions hugely.

Okay. Thank you. I appreciate that.

If we can bring the broadcast to an end for the 10-minute break. Diolch yn fawr iawn.

Diolch yn fawr.

Jason.

Bore da, bawb. My name's Jason Thomas. I'm director of culture, sport and tourism in the Welsh Government.

Bore da, Minister. A few general introductory questions. The tailored review obviously covers a wide range of issues around the National Library of Wales. I was just wondering what your initial thoughts are on the review, the process of it, and the conclusions.

Well, I'm very happy with the process because it is an attempt to improve the quality of scrutiny. Having spent most of my political life scrutinising rather than being scrutinised, I think it's essential to our democracy. I'm aware, of course, that this is the first one that's been undertaken for a non-departmental or sponsored public body of the Welsh Government. Therefore, it's quite important, I think, that there is full use of the scrutiny process. Clearly, as you are the policy committee, the subject committee and the select committee in one, as it were, as we work in the Assembly, then I'm very glad to join in this process.

The review, the timing of it and the preparation of it, doesn't deal, of course, with some of the more immediate issues that have occurred as a result of the pandemic. Does that cause you any concerns, or how do you think that will be accommodated in the consideration of the review itself?

Well, the pandemic, the public health crisis, is the main issue that we have as a Government and as a country—well, internationally, obviously. Therefore, there has been an attempt to take a cross-governmental view. This original review that is being looked at today was completed just at the end of the process before the pandemic really hit in March, as I understand, although published later and now being considered.

As far as I'm concerned, I will continue to follow the public health advice that we get from our public health advisers in Welsh Government. Any decisions about the future of institutions and the funding of institutions happening in relation to the current crisis have to have regard to the importance of public health needs as being paramount. I've got no issue with that, really.

Thank you. Mick.

Minister, one of the matters that arose from the evidence session this morning, of course, is that there is an action plan being prepared that is going to the library board imminently, looking at a timetable taking us to around about March or April of next year. Obviously, there will be engagement with the Welsh Government very closely once that action plan has been concluded.

Up until now, of course, the big focus has been on financial sustainability. But, overall, within that timetable, are you satisfied that that is a workable timetable in which, I suppose by the early summer of next year, you will be able to come to a sort of mutual way forward for the library, in conjunction with the Welsh Government and any other relevant bodies?

Yes. I would like to make it clear, however, that I don't believe it's my role, or the role of any culture Minister, to micromanage our cultural institutions. It's the responsibility of the institutions. When a report is produced—and this is, I think, the third major study of the library in the last 10 years, because there was an audit study, and now there's this tailored review—it is for that institution to consider how it should develop itself.

I have some very clear views about how national institutions should operate. I'm very pleased at the recommendations—which, no doubt, we will come to in a few moments—that there should be far more effective co-operation between the national museums and galleries, especially now, as the national museum, hopefully, will be moving to open its new museum in the north at some time in the next two years, if we have the capital investment to do in the north what the national museum and galleries have done in St Fagans.

I think it's clearly important that we should treat these national institutions on a par. They are historical institutions that are part of the cultural development of the national life of Wales, really going back to the nineteenth century in gestation, and implementation throughout the twentieth century. And, therefore, if I'm considering issues in relation to the library, I will always consider them alongside the other national institutions, including, of course, that very important scientific institution, the National Botanic Garden of Wales. These are all national institutions for which I have ministerial responsibility, and have had now for two years, and these institutions are key to the development and the sustainability of our cultural life.

Thank you, Minister. That concludes my questions.

Thank you. John Griffiths. 

You rightly and obviously point to the importance of the national library. So, in terms of its core funding and the impact of cuts to that core funding, what assessment has Welsh Government made of the library's ability to continue to carry out those core functions?

Well, I don't accept that we have made cuts. What we have done is we have considered—. I have maintained the level of funding of the library, not in real terms, but then no institution of Government, except for the major priorities of health and social care, education and training, and the economy, have benefited from anything except stability of funding. And what I sought to ensure for these institutions was that we shouldn't make further cuts, or further reductions, and I don't believe that's happened. But I will ask my officials, colleagues, Jason Thomas and Steffan Roberts to comment further on that. 

As far as my understanding of the budgetary position of the national library is concerned, I do agree that there were issues before I took over responsibility—obviously, I won't comment on those—but during the present period, what we have done is sought to ensure that the library has the resource that is comparable to that which has been, in terms of revenue funding, of benefit to the national museum and galleries.

Jason, did you want to come in?

Diolch, Chair. Thanks. Just an observation on the question of what assessments we've made. So, we make regular assessments of the financial sustainability of the library, as we do with all our sponsored bodies and partner organisations. We meet quarterly. The Deputy Minister himself meets biannually, and we have very regular engagement at senior level and all the way through the organisations at officials level. So, we make a regular assessment of this, and this obviously feeds into the budget preparations that we make every year. But to the point Steffan raised there, it has been challenging because we haven't been able to plan for the longer term because we haven't had the ability to do that in terms of the funding we get from the UK Government. We are in November now, and we still don't know what the budget's going to be next year. So, that's the challenge, but we do make regular, ongoing assessments.

Thank you. John. 

I think we all understand the effects of austerity and the challenges that it's posed. But there have been substantial cuts in real terms to the library's budget, and, obviously, that's also been the case with other Senedd-sponsored public bodies. So, I wonder if you could say a little bit, Dafydd, about the comparisons. You said that you seek parity between the organisations. So, how has the library fared compared to the others, such as the national museum? And has the impact on those institutions differed in your view?

No, I don't believe it has, and I wouldn't have allowed it to happen. We've treated these essential national cultural institutions on the basis of equality in the way that their position is covered. Obviously, there are issues involving capital expenditure, but there have been issues of the structure of the buildings. And those issues—because of the nature and the age of many of the buildings that we are dealing with—there have been issues of new investments, and perhaps the national library would have preferred to have received more indication of what was possible on the capital side. But in terms of the revenue, what these organisations have had is a budgetary standstill, and I'm afraid that that is a position, of course, that has affected all those institutions. 

Historically, we can look back 20 years and say that there are examples of underfunding of our national institutions, and that applies, I have to say, both to the history of the funding of the national museum and galleries as much as it does to the national library. And those are issues before my time and are out of my control. But what I am keen to do for the future is make sure that the budgetary processes, both internally within the library and in the relationship between the library and Welsh Government, continue to be open and transparent in all that we do. And I don't think it's possible to argue that the library has been treated unfairly in comparison with other major national institutions that I've mentioned already: the national botanic garden and its scientific work and, obviously, all the activity that goes on in the national museum and galleries.

Thank you. Jason Thomas, you wanted to come in.

Yes, I think, just to support that comment. We've had to take decisions over the last couple of years about how we allocate the budget that the Deputy Minister has and each of the sponsored bodies are different. You could group, potentially, the Arts Council of Wales and Sport Wales as bodies with relatively low staff cohorts, but they fund other organisations. You could call them an umbrella body, whereas the national library and the national museum, they obviously have large staffing complements and they run their own facilities and sites. So, they are different. So, we were looking at options about whether we did fund them differently, but we decided, as the Deputy Minister said, that we would treat them all equally. So, if you go back through the budget over the last couple of years, you will see that it's exactly the same percentage that's applied to all our sponsored bodies. We felt that that was the best decision in terms of fairness to all.

I'll bring John back in a moment, but I just would comment that one doesn't always achieve equality of outcome by equality of process, and different institutions and different organisations may be in different places, but that's just a comment. John.

I was going to say something quite similar, Cadeirydd, because, obviously, the ability and the performance of institutions in terms of raising additional funds outwith what they've received from the public purse and their ability to be sustainable financially in the way that they organise themselves, there have been differences in approach and performance there. I hear what you say, Dafydd, about not micromanaging, but in terms of helping the library to achieve financial sustainability beyond additional funding, is Welsh Government working, and will Welsh Government work, with the library to achieve that?

Well, we're always working with the institutions that we fund, and we have had discussions continually, as you heard from my senior officials, with the library, and it's part of the financial process and will form part of the budgetary process. But of course, we have to accept the discipline of annual budgets at the moment—this is the situation we're in. We will finally have a budget that will be published at the end of December for Welsh Government, for the coming financial year. But that will be based on the CSR, what we get, the spending review of the UK Government. You know the system, John; you've worked in Government yourself and you know exactly what the system is about. Devolved Government is not magic; devolved Government is based upon what is available either through the Barnett formula or through additional allocations made by UK Government, and that is the position we're in. Our role is to ensure that the bodies that we deal with are treated fairly by Welsh Government as part of that process.

Thank you. Just before I bring John back in—

Okay, well, a final question from me, then. It's about the challenge panel's letter, which referred to traditional tensions between the library and the national museum. I just wonder what you would say about that, Dafydd. What are those tensions and how might they best be addressed?

Well, I haven't discovered any tensions. To the contrary. I visited the library formally as a Minister and discovered what I believe is the most amazing space for art and other exhibitions in Wales in Oriel Gregynog, which was not being fully utilised for that purpose, and we have invested in that, and the library has invested, and there will be that space that has been restored and will hopefully be able to be opened at some time to the public for events. But it seems to me that the fact that the national library has the largest public art gallery in Wales on a very dramatic hillside location means that, for the future, that should be an essential part of our commitment to contemporary art and indeed to all forms of visual arts in Wales. This is the subject of a future announcement, hopefully, that we will make before the coming election, because it's a commitment that was entered into between Plaid Cymru, my former party, and Welsh Labour, and I'm very determined that that promise is carried out properly. 

Diolch yn fawr. Just a point, a reflection, on the past six months, if I may, Chair. I think it's been a very positive relationship between both bodies over the past six months, extremely engaging, plenty of sharing of knowledge and learning from each other, and one particular example of that is how they worked together to maximise the opportunity from the furlough scheme, really sharing information and knowledge on that front. So, from my perspective, it's been a very positive relationship. Diolch yn fawr.

Anything further from you, John? No. I'll turn, then, to David Melding.

Diolch yn fawr, Cadeirydd. I just wonder if I could go back to the essential question here, of whether the library is sustainable in terms of delivering its traditional range of services to the nation, only in a modern guise, because I was a bit surprised by your answer. I think it's perfectly fair for the Welsh Government to emphasise the budgetary constraints it's been under, which are not of its own making and haven't been since 2010. We've had a radically different financial environment. So, I think that point is really perfectly proper, and that obviously shapes the range of decisions you can make, but we're not trying to pin blame on the Welsh Government for a possibly unsustainable model emerging in the library, which the review seems to indicate. You've not mentioned the pay review and the implication of pension law, and, in effect, we've seen the library staff having to be reduced from roughly 300 to now 225 to meet those financial costs, and a further 30 in store, which would take them to about 200, or well over a third reduction. So, I think it would be useful to hear your assessment of the current viability of the staffing structure and their ability to deliver what we have come to expect from the national library. I think it's important that we look at that, and this is not to point a finger of blame at the Welsh Government, because I think that's quite inappropriate, but, for the next 10 years, we kind of need to make an assessment of what is possible, what we can have as a nation in terms of its national library, and what capacity there may be to rebuild some of the—[Inaudible.]

Well, I'm not going to make an assessment of the internal management decisions that the board of the national library and its leadership may have taken in previous years, and I don't think it's appropriate for me to do that. What I do have very clear views on is that the future is digital and has to be digital, and is investment in digitisation—I managed to say that word. Digidoli—it's much easier in the Welsh, digidoli—the ability for the treasures of the national library and all its works to be digitally accessible to the people of Wales is the key priority for the future, and we made that quite clear to them, and they are very keen to develop that and have undertaken some major work of that kind already. And those are the kinds of capital investment that I want to see continuing for the future.

Thank you. David.

I won't press, but clearly between now and the election we're going to have to have some response from Welsh Government as to their view on the central finding of this tailored review that the current situation—I won't call it 'model' because it's happenstance and unfortunate circumstances that have resulted in the current situation—whether that is a sustainable one or not, and I think the nation has a right to know what its Government feels on that question. So, we await that, and I say this neutrally, because I'm certainly not attempting to simply pin blame at the current Welsh Government, which, as I said, has had very challenging circumstances financially, which I completely recognise.

Can I just go to another important issue? I think the tailored review is quite sharp in pointing out that the board structure, the way the trustees work with the senior management team, the executive and directors is a fairly old model—pretty much advise and scrutinise, not really making strategic decisions and being responsible for their direction—and I just wonder if it's been your assessment and the assessment of your officials that this area really does need to be modernised. I think all of us who read the review's recommendations in this respect would say—I wouldn't say they're basic—they are about recruiting more effectively trustees, skill-based recruitment, training them, completing their induction in time, giving them assessments, and ensuring board papers identified those areas that are for discussion and decision, and then pointing out that they should be mentored perhaps with other arm's-length bodies that have been modernised in their board structures. So, I just wonder what your views are on that, whether you picked up any of this and perhaps have been encouraging general reform yourself.

Well, I will ask my colleagues to respond to that in detail, but I just want to make the basic point that we are seeking the role of president of the library, which is the traditional description. It has been advertised, and we are pursuing, hopefully, either a—. Well, it's currently being considered as to how we take this matter further, but there will be an appointment of a new president in the near future, and trustees. We are very keen to see that that system operates effectively.

It's not for me to discuss how people internally organise their papers and how their boards meet and what they do. The key thing for us is for us to be satisfied that the organisation functions in a way that we expect twenty-first century governance to happen in any institution, and we have made those things very clearly known.

If I may allude to one chapter where I did play a bit of a role, when there was an attempt by the library to utilise funds that I regarded as appropriate for its main core function to be used to develop another activity that was not, in our view, central to its core function, we made it quite clear to them that we expected the library to give priority to its central role, as well as to what I have highlighted already—the need for extension and engagement with the Welsh public through digital means. Jason, I'm sure you've got something you'd like to say on that.

Jason Thomas.

Diolch, Chair. Yes, so, I think that, as the Deputy Minister says, it's not our place to say what goes on in individual board meetings, into the specifics of that. But I think that it's fair to say that, when we have looked to appoint trustees, or even presidential appointment exercises over the years, we have struggled to get really large fields, or, I would say, really strong fields there. Whether that's by nature of this being in mid Wales or west Wales, I don't know. I can't say that. Or, whether it's the way that we've set out the role profiles—. But we have certainly struggled to attract big fields there. We know that the more diverse that we can make a board, and the more experience, expertise and fresh thinking that's on there, the stronger that board is going to be. I think it is fair to say, to respond to the question directly, that there have certainly been some occasions in the past where we have had some concerns about the level of scrutiny taking place at the board.

One other thing that I would say as well is that we've felt that there has been a tendency, when things have got tough, that the immediate solution is to apply pressure on the Welsh Government to provide more funding. That's always the immediate next port of call.

Yes, usually through interviews on Radio Cymru, I notice.

Sorry, I had to get that in.

I think that our hope would be that, as a board that's accountable for the financial sustainability of the organisation, the first step to take is to proactively address that issue and look at all the challenges. Coming to Welsh Government for more funding could certainly be part of the solutions to that, but we've just felt that there's always been this tendency to come to us first—come to the Welsh Government for more money. So, I think that, to answer that question directly, we do think that there are opportunities for strengthening the board and for it hopefully to be more diverse via future campaigns. That would certainly be my view.

Thank you. Anything further, David?

No, I think that that covers a lot of the ground I wanted to pursue.

Before I bring Carwyn Jones in, can I just pursue that point about appointments a bit further? Obviously, it's a good opportunity to bring additional skills and approaches into the board. Perhaps, if you'll forgive me, Minister, I'll put this directly to Jason, because he may have the answers. You said in your response to David Melding that you have had issues with getting a broad enough field of candidates. Can you tell us a bit more about what steps you are taking to address that this time? If we look at the review and its findings and the challenge letter, the library is obviously in a situation where it can feel pretty fragile, and it needs that additional leadership from a strengthened board. So, are you taking some specific steps to try to make sure that you get a broader field this time, and can you tell us a little bit more about that?

Thanks, Chair. I can touch on it a little bit. Colleagues in the public appointments unit lead on public appointments, and it's under a different Minister in the Welsh Government, but I can say that we've looked at this a lot over the last couple of years—how do we strengthen these fields—and I know, for recent campaigns, we have tried to target different publications, use digital media more effectively, tried to use advocacy for people to try and raise awareness of these posts. So, I certainly feel like we are trying everything that we can, but I can say from recent exercises that we still seem to be getting the same outcome. So, it is a real challenge in public appointments generally.

Well, that might be something that the committee may wish to ask the relevant Minister about in this particular case. Carwyn Jones.

Thank you, Chair. Just on that point, briefly, I think your real problem is that remuneration is too low. There are lots of people who would take the role on, but this is an executive chair role that pays £17,500 a year for a significant time commitment. I'm afraid you're never going to get the quality of people you need with that kind of package. Times are hard and the finances are not easy to come by at the moment, but if you compare it with equivalent roles elsewhere in the public sector, it doesn't come close, and I think that's part of the problem, if I'm honest, but I'll leave that with you.

Do you want to come in there, Jason?

Jason or Steffan. Steffan, I think.

Steffan it was. Okay, sorry.

Thank you all. Diolch yn fawr iawn. And we can bring the broadcast to an end, please.

I'll just ask you to introduce yourselves in the order that you're on my screen, so if you can just say who you are and where you're from, and then, after that, I think you've all been asked to produce a short presentation, about eight minutes, and what we're looking for here are some potential solutions to the problems that we face with the underdevelopment of news media in Wales. I think we're all 'horribly familiar', are probably the words, with some of the challenges, and I know that some of you have come to us before, to this committee, to talk about some of those. But if we can try, as far as we can, to focus on solutions—I think we were pleased, as a committee, to hear yesterday the Deputy Minister say again that he's interested in looking at potential different models and whether there is a possibility of some arm's-length support from Welsh Government, which has been something that, until this summer, wasn't really on the table. So, we feel as if we have a bit of an open door now as a committee, so if you can give us some ideas to take to Government, that would be really useful. So, I'll just ask you to briefly introduce yourselves, and then we'll go through your presentations. So, if I can start with Rachel Howells.

Morning. Bore da. My name's Dr Rachel Howells, I'm a journalist. I've worked most of my career in Wales, I'm also a freelance academic and researcher, and I work for the National Union of Journalists, delivering training across Wales for media professionals.

Welcome, thank you. Emma Meese.

Hi, there. Bore da. I'm Emma Meese, I'm the director of community journalism at Cardiff University and, more recently, the director of the Independent Community News Network, which we refer to as ICNN, and that is the UK's only representative body for independent news publishers across the UK, so we have 125 publishers that we represent are the moment, which would make us, if we were a co-operative, the equivalent of the fourth largest news publisher in the UK.

Thank you. Karin Wahl-Jorgensen—I hope I've said that correctly.

Yes. Hi, I'm Karin Wahl-Jorgensen, I'm a professor in the Cardiff School of Journalism, Media and Culture, also the director of research for the centre for community journalism, which is, as Emma just said, home to the Independent Community News Network.

Diolch yn fawr—thank you. Nick Powell.

Hello, I'm Nick Powell. I think you're all familiar with me with my work for ITV, but I'm here today as the chair of the Welsh executive council of the National Union of Journalists.

Croeso, welcome. Ifan Morgan Jones.

Hello, my name's Dr Ifan Morgan Jones, and I'm the course leader of the BA in journalism at Bangor University.

So, if I could start the presentations, the idea is we'll do the presentations one after each other, and we'll bring Members in at the end of that, if that's okay with everybody. So, Rachel Howells, if you'd like to start.

Good morning. Yes, thank you. So, I briefly went through this, but it's in my presentation, so I'm going to go back over it. So, I'm a journalist. I've worked most of my career in Wales. I was one of seven journalists who founded the hyperlocal news website the Port Talbot Magnet back in 2009, and I edited it for most of its time as well. I'm also an academic, so I studied for a PhD at Cardiff University looking at the democratic deficit in towns that use their local newspaper, and my case study was also Port Talbot. As a result of that work, I now work freelance as a researcher for the actor Michael Sheen. He's very interested in looking at solutions and to try to solve this news deficit that I identified through my PhD, so I've been continuing my research there, doing focus groups and so on in Port Talbot. I'm also on the Welsh executive council of the NUJ alongside Nick Powell, and I'm on the advisory board of ICNN as well, so it's a very small world. We're all linked to each other.

I do want to talk about solutions today, and I know that's the focus of the session, but I think it's important that I just skate through some of the findings from my PhD, because I think those speak to each other. In my PhD I interviewed journalists, I did content analysis that covered about 45 years of news about Port Talbot, I did focus groups and I did surveys, so I looked both at the news production side of things, but I also looked at the audience side and how that impacted on citizens.

What I found was frightening, really. We'd lost up to 90 per cent of our local journalists across Wales—100 per cent in Port Talbot. There were five newspapers that were publishing there at one point and had offices there. There are none there now. The story of ownership has been crucial in that—as that's become more remote, then we've had more cuts and closures, and journalists have become more remote from the town. And I think that's important, to make that link, because what I found was a democratic deficit—not where the newspaper closes; there's been lots of research into the link between newspaper circulations and a democratic deficit, most recently the Plum report for the Department of Culture, Media and Sport, and I did find a democratic deficit, and I did find something very measurable, but it was after the journalists left the town, which suggests that perhaps news black holes are much more widespread than we might like to think, because of the number of journalists. We might have titles there, but we don't necessarily have journalists working for those titles, and so there is a huge problem.

In that gap after journalism leaves, what you have, and what I've found in Port Talbot, is that rumour and speculation are rife. We've seen that through COVID-19, that that actually becomes quite life and death, those conspiracy theories, the fake news and the lack of trustworthy sources, and the willingness of local people to trust sources that aren't necessarily fact-checked or balanced becomes quite life and death.

It's been great to see hyperlocal succeeding across the UK. Caerphilly has done really well, in Bristol we have people like the Bristol Cable, and Wrexham.com, Deeside.com. Where those news outlets are tailored to their local communities and are doing well and are sustainable, that's brilliant to see. We set up something very similar to the Bristol Cable in Port Talbot through the MagNet, and it didn't work there, and I think the economic deprivation of that community had a massive role to play. Where those communities are economically deprived, and where the business community can't necessarily support journalism, there's even more of a case to be made for intervening from the Government side—to go in there and intervene and fund something.

I think we almost need to think of good-quality, trustworthy local news in the same way as we think about clean water—that it should be there. But there needs to be a framework set up across Wales, because we also have a massive problem with trust in news and information that's coming out and in journalism. That's something that I've seen first hand in the focus groups that I've been doing. I ask everybody, 'What would you like your local news and information to look like? What ideally would you like?' And one of the groups, the younger group that I spoke to last summer, told me that they would like a local councillor, because they know them, they trust them, they trust the information; they think that they represent them. They would rather a politician, in other words, than a journalist at this point, because those young people have never had a journalist in their town while they've been adults, so they don't understand what that looks like. So, we need to grow something from the grass roots up.

So, this is where I come to solutions. I really do think it's time for Government to step in and fund something. I think an extension of the fund that's been made available already would be a great starting point—that we have money available for start-ups or to support publications that are existing already and have gone through the process with ICNN. There's a great framework in place there already. So, to continue that would be an excellent thing. We might even look at setting up news hubs across Wales, Government-funded. It all has to be arm's-length. I feel I don't need to say that, but I'm going to say it anyway—arm's-length, independent of the state. It's possible to do it. I've been across to Norway and I've spoken to academics there. They have a great way of subsidising their media, and it's really simple. All the publications have to do is meet a certain threshold of subscribers. Once they've done that, they get, basically, a half-salary for one member of staff, and it's administered by one person in sixth months of the year, and it happens every year. So, it is possible to do it quite simply and to create quite a level playing field across publishers. 

I think there are other measures I'd like to just really quickly skate through—I don't know how I'm doing for time. I think it's really important that we continue to lobby for some kind of windfall tax on the giant tech companies. I know it's not within the remit of Welsh Government, but it's certainly something we can call for and shout for, and we should. I think opening up public notices more widely so that there's a level playing field for Government spend and Government advertising is crucial. We need to also open up the corridors of power—press lists, that kind of thing—to make it more easily accessible for everybody who is setting up to be able to access those. We found that very difficult at the Port Talbot Magnet. Safeguarding existing titles by designating them as community assets would be great, so that, where there are titles at risk, we can step in and the community can get involved or journalists can get involved to save those titles. And I think also the NUJ's news recovery plan is a great start on a wider UK level.

But, in Wales, one of the things we could implement quite quickly is vouchers for young people to get them into that news-buying habit and to get them into a relationship with news young. So, those are the things I'd like to recommend to you today, and that's me done. Hopefully, I'm within my eight minutes. 

Just about, yes. I was just about to start making 'move on' noises, so that was perfect. Thank you. So, I understand that Karin and Emma are going to do their presentation as a bit of a double act and I think, Karin, you wanted to go first in the double act. 

That's right. So, I'm here with Emma representing the Centre for Community Journalism and ICNN, and I want to provide some context for our recommendations, based on brand-new research. So, since June, I've been carrying out research based on interviews with ICNN members, funded by a grant from the British Academy, to look specifically at the experiences of the sector following the pandemic. In total, our team has interviewed 59 members of ICNN, including six in Wales—so, about half of all ICNN members in the country. And our research confirms a lot of what's already known about the community news sector—that these outlets serve a vital role in sustaining democracy and also supporting local communities and local businesses.

And as Rachel also implied, community journalism outlets are frequently started up in areas that have been abandoned by other news organisations due to the collapse of the local news industry. What that means is that they're only sources of news and the only way of holding local authorities to account in places ranging from Splott to Caerphilly and Llanelli. And indeed the editors that we interviewed were also highly aware of their vital role in boosting the local economy and the visibility of local businesses. So, for example, Ben Black of Cwmbran Life started doing Facebook Live videos featuring local businesses to support them after the end of the lockdown. And despite their small size, these outlets collectively have a very significant reach. So, online, they reach 1 million people in Wales, with a collective print run of 20,000. So, that's a third of the population that's reached by a quality and reputable independent news publisher. But, at the same time, what came across very loud and clear in our interviews was that these are highly precarious news organisations and very vulnerable to shocks like the pandemic. They're often run by a single person and sometimes as a part-time endeavour alongside other paid employment, or what editors frequently call 'day jobs', and their very small scale means that they are really vulnerable to illness and other disruptions, like a pandemic, and have very, very limited cash reserves. So, the loss of local advertising as a result of the pandemic was devastating to many of the outlets. But, on the other hand, small grants, including from the Welsh Government, and new revenue streams like, let's say, a new council advertising account—those kinds of things make a huge difference to their ability to survive. So, on the basis of our research, we believe that supporting the sustainability of these news organisations, but also encouraging future growth in the sector, is essential both to democratic life and the economy of Wales. And I'm going to hand over to Emma for our recommendations. 

Thank you, Karin. Emma. 

Thank you. So, as Karen said, based on our experience of working for almost a decade in the independent community news sector, and based on excellent research such as Karin's, we formed a number of recommendations that we feel would support journalism in Wales moving forward.

So, I'm going to start with formal recognition. The Welsh Government must do all it can to formally recognise that the independent community news sector in Wales is as important as the traditional press. It should make addressing the issue of media plurality in Wales a priority, supporting plurality through investment in the independent sector. And, if we look at the future, and imagine one or both of the main print publishers in Wales withdrawing their services, our news landscape would look very bleak indeed. So, I think that's something that's really important that we try to envisage. At the moment, a lot of the news does rely on coming from two organisations, and we've seen big changes within those organisations already, and, if they continue in the way they are, then that could have a really catastrophic impact. So, we do have a duty to ensure the foundations are in place so that any new titles can survive and thrive in villages, towns, cities and counties right across Wales, and it's really important that we look at the news ecosystem as a whole and we value all publishers equally. There are plenty of communities across Wales that would welcome an independent news title like the dozen ICNN members that already exist across the country.

And also there needs to be recognition of journalism as a public good to foster experimentation with different funding models and to stimulate independent, plural and truly local news in print and online, because, as Rachel was saying, having a title there is not enough. If you don't have any local journalists on the ground in that area, then that massively adds to the democratic deficit. So, an important step forward is to start talking about news publications as 'outlets', rather then continue to use the term 'newspapers'. I feel very strongly about this. Digital and print are still unequal. So, while digital titles command the biggest audiences in numbers, reach and engagement, a number of schemes and funding pots, including Government ones, still only remain available to those with daily or weekly printed titles. So, I think, in order for the Government to get its messaging out and to reach people, we need to start thinking about news publications and publishers, rather than purely newspapers; that's quite an archaic way of looking at things.

In view of this, the Government must extend its commitment to the independent community news sector by facilitating a brokerage agreement between ICNN and the Government's media buying agency, Golley Slater. So, we have evidence that shows—which was also given to this committee, a while ago, by one of our members, the Caerphilly Observer—that they have been deemed insignificant in the past. The reach of larger organisations has decreased significantly in recent years, and this has only accelerated during 2020. However, the Government insists they are committed to reaching as many people as they can through their public health information campaigns, as they tackle the spread of COVID-19 across Wales. So, Welsh Government recently told the BBC, 'Media buy-in includes a cross-section of local and community radio stations and local news media outlets across Wales. We will always consider further outlets, including ICNN members, as a appropriate.' There is as yet no indication that our members have been contacted. We certainly haven't been contacted. Given the Government's awareness of the sector, we can't quite fathom that independent news providers were not included in the public health campaign, especially considering one of those titles is the only publication covering the entire county borough of Caerphilly, which was the first area of Wales to enter a second lockdown. As Karin mentioned, ICNN members reach a third of the population of Wales, so, if community radio stations were included, why were not independent community news publishers as well?

So, we do welcome the discussion with Welsh Government and its media buying agency regarding the appropriateness of our members, including quality and reputable independent news publications. It's a win-win for the Government. By continuing to exclude these titles, the Government is further hammering the nail in the coffin of the independent news sector, which is the only one that offers plurality of voice, who will be unable to compete with larger titles who have continued access to this Government ad spend, which brings me on to the next recommendation, which is tied in. 

So, being able to publish statutory notices is important for independent community news titles for all the same reasons as I've just mentioned for the Government ad spend. Continuing to miss out on this funding, when it's given to their competitors, is really unfair, and it also means that these public notices aren't necessarily being placed where the biggest audience will see them—they're just being put in the same place as they always have been. So, a recommendation on this point made by this committee has been accepted by the Welsh Government planning department, and, while this is an excellent first step and we are hugely appreciative, we need all the other relevant departments to follow suit. So, if work can be ongoing there, that would be excellent.

That leads me to talk about grant funding, which is already in place in terms of an annual grant to Welsh language newspapers by the Books Council of Wales. It should be made available to relevant start-up media enterprises in areas where the withdrawal of established journalism from Welsh communities has been most acutely felt, with sufficient and ongoing support, and to established organisations that have a proven track record of reaching audiences and producing contemporaneous public interest news.

So, a previous pot of money that the Welsh Government had provided, which amounted to £100,000 a year, to support independent community news publishers in Wales, had an incredible impact. It even led to the launch of a new digital news title for north Wales. In mid Wales, the fund helped to create a business directory for MyTown Media, which not only generated revenue for the publisher, but also supported the local business community. I can't stress enough how far a relatively small amount of money will go to help and support this sector, and, without any shareholders to pay and relatively low running costs, any money invested would go directly to fund journalism at its core. The continuation of this fund would be hugely beneficial, but would need to include capital expenditure if it was to be as successful as possible.

There's also the option of paying for an ad campaign, but to advertise local businesses, instead of Government messaging. This could really help kickstart the local economy in communities across Wales. I know they're looking at this at a UK level. So, instead of just paying for Government ad messaging, the money then, almost like a voucher scheme—. So, Rachel mentioned a voucher scheme for young people to buy newspapers. There could potentially be a voucher scheme for local businesses, where they could spend those vouchers with local newspapers, which would really help the community as a whole.

I would just like to, before I finish, just really quickly mention that, when people talk about sustainability, they usually equate it to financial sustainability. However, when these titles operate as a one man band, there's no slack in the system, as Karin mentioned, that allows for sickness, holidays or any of the things that workers will encounter at some point or another. So, if there was a fund or grant that would enable small, independent titles to employ another person, this again would be absolutely transformative in securing a far more stable future for journalism in Wales. Even if this was in the form of an apprenticeship or internship, having a second person on the team ensures more stability, longevity and will go a long way towards tackling other growing democratic deficits in Wales. So, as Rachel said, just having bodies on the ground makes a huge difference. So, more dedicated reporters will lead to more coverage of important issues.

We've noted and welcomed the Government's apprenticeship announcement today, and, while £1,500 or £3,000 may be a great help and incentive, it may still not be enough for independent publishers to take advantage of the scheme, so potentially a top-up of that grant could make a huge difference in the independent news sector.

So, we are aware of, obviously, a wide range of other measures that are available, such as tax breaks and rates relief, however we're sure they'll be widely covered and discussed by others, and they wouldn't benefit the independent news sector at all. As we've seen with the UK Government schemes, independent publishers continue to fall through the cracks, which is why I've solely spoken about the value and impact on independent journalism today. Thank you.

Thank you very much. That was very helpful from both of you.

Diolch yn fawr, Ifan. And last but by no means least, Nick Powell.

Thank you very much for this opportunity, and thank you for your recent report on the impact of COVID-19; we were, obviously, very pleased to see that our submission to the committee was extensively quoted. As you suggest, Chair, I'll try and focus this morning on some solutions to the long-term problems faced by the industry in Wales, which the pandemic has aggravated, even as it's demonstrated the importance of journalism with a Welsh perspective.

The situation continues to deteriorate, with job losses at practically every significant employer either proposed or already implemented. That is, as I say, an acceleration of a long-term trend as the industry has struggled to respond to the impact of new media on once highly profitable businesses. The NUJ's news recovery plan calls for a 6 per cent windfall tax on the tech giants, and then a levy linked to their profits to fund public-interest journalism. Facebook, Google and Apple have been helping themselves to journalist content for free, and hoovering up virtually all the digital advertising revenue. We would urge you to recommend to the Welsh Government that it adds its voice to a growing international consensus that tech giants' power must be curbed, and they should start to pay their way.

It's an area where I know that perhaps the EU has been most vocal, but Australia has recently introduced a code of conduct to force them to pay publishers. The US Congress has been looking at the threat from these companies to American democracy, and in the UK the Competition and Markets Authority is preparing to mount an investigation into Google and Facebook and has called on the UK Government to set up a digital regulator. In broadcasting we already have a regulator, of course, but we need a regulatory regime fit for the digital age. Viewers must be able to easily find public service television channels in a world in which major American-owned platforms have an increasingly powerful role. Prominence on all platforms is essential for the future of public service broadcasting.

Newspapers should be viewed as community assets. Instead of newspaper groups closing down titles when they close newspapers, the title should first be offered to the community. How would that work? Well, the Welsh Government should set up a journalism foundation—an arm's-length body—to help fund new models and innovation in the media, and to improve media plurality. So, for example, the groups, sponsored by their local titles, would have access to some funding and support. The UK Government has its part to play too. The NUJ in England is in discussion with the Department for Digital, Culture, Media and Sport about a package of tax credits to encourage newspapers to invest in public interest journalism. Like funding from the journalism foundation, this will come with conditions—for example, the newspaper would have to show that it had plans to improve the diversity in its newsroom.

An NUJ proposal that's particularly relevant to us in Wales is a voucher scheme aimed at young people, which I know has already been mentioned. We've lowered the voting age and we need to encourage 16 and 17-year-olds to get their news from reliable sources. They need to be informed about democratic institutions and those in power. So the voucher would be aimed at this age group, and would pay for a subscription to a news or current affairs publication or website.

As a trade union, the NUJ does, of course, campaign to protect its members' jobs and improve their working conditions, but we've always campaigned for journalism that serves the public and society well. Protecting jobs and protecting quality journalism go hand in hand. We're absolutely not engaged in some desperate attempt to preserve the status quo or to get it back to where it was before COVID—we weren't in a good place a year ago. Yes, as our general secretary has said, we need to stem the immediate damage and take longer-term measures to heal historic wounds. Our aim is to create a healthy and diverse media, focused squarely on the public good, one that can be sustained now and into the future.

Thank you very much, Nick. Diolch yn fawr iawn. Thank you, all. I think you've done a very useful job for us in focusing on some possible solutions, and I know there'll be issues here that Members will want to pick up on. Who would like to start? Mick.

If I could just give a list of a couple of things I've noted as you went through that I thought were really quite interesting, and perhaps responses can come where individuals feel appropriate. The first thing is the way in which the Welsh Government public health, for example, or public interest advertising, is used—and reference was made to overdependence, I think, on things like Golley Slater or agencies, which tend to exclude—. This is something I've noticed within community radio and raised. I wonder if someone could expand a little bit more about how, potentially, that money could go and could be co-ordinated into a mutually reciprocal way of supporting some of these objectives as well as achieving the various objectives of the advertising itself. 

The other thing I'm quite interested in is the extent to which the support specifically for investigative or critical journalism—the importance that that plays within the democratic process. We used to have a lot of specialist journalists and that specialism has almost wholly disappeared. Every paper at one stage had an industrial correspondent et cetera. Those aren't there now. Whether it's something that should be a specific focus itself, because, it seems—. We see often in America but not so much over here the importance of critical investigations, independent investigations, in terms of holding institutions to account.

The final one is ethical standards, of course, in terms of whatever funding regimes there might be or support there might be. Should there be an issue of ethical standards of journalism that ties in with the support, and how might that operate in terms of the consequence for independent journalism, or might it restrict et cetera—how would that balance be operated and would it actually be a good thing to have? Those were the three things that immediately jumped out to me.

Thank you, Mick. A couple of areas to cover there. I should have said earlier to witnesses that if you want to participate, just sort of show like that. I think, Emma, you were the person who raised specifically the details about Government advertising. Can we start with that? I guess part of what may be happening is that it's easy for Golley Slater and the big agencies to go to the usual suspects. It may not be as easy for them to get to some of the hyperlocal sources that you were talking about. So, can you say a bit more about that in response to Mick?

Yes. That's why we set up the independent community news network, because after working in the sector for a long time, I realised that I was being hailed as the representative and I was acutely aware that nobody had appointed me to represent them. So, we did a whistle-stop tour of the UK, just asking everything that anybody would want from a representative body, and that is our role now, so we've been doing this. The reason we set up when we did, as quickly as we did, was so that independent news publishers could take advantage and participate in the BBC's local democracy reporter scheme, because we estimated or guesstimated that there were between 300 and 400 independent titles across the UK, but to try and find them and connect with them and build relationships with them would have been a nigh-on-impossible job. So, we've set up as an organisation so anybody like Golley Slater or any other ad agencies or government can come to us, and we can then pass the message on to our members.

That's important for two reasons. It ties in with the third question that you asked, as well, Mick. It's really important because in order to be a member of ICNN you have to pass quite stringent entry criteria. You have to be completely impartial, free from any bias, be it political, religious or other. You have to adhere to the editors' code of practice—either the NUJ or the Independent Press Standards Organisation code of journalism. You have to have at least six months of contemporaneous reporting under your belt, and with the high editorial standard we kind of make sure that—. So, what we do is that we've got two main points at ICNN and the Centre for Community Journalism: 'Can we create more jobs for journalists at a local level?' is our No. 1 priority, and our second priority is to ensure that the quality and standard of journalism on a local level is as good as it can be. That doesn't necessarily mean, as Ifan was saying, setting up new titles, if you look at plurality and everything else. It might be just making sure that those who are working in the sector at the moment get paid for the work they do and they're not just volunteer run. So, we did that so that the BBC was satisfied it could only partner with quality and reputable news publishers. We had huge discussions with the great and the good of journalism across the UK, across all sectors, and that's where our entry criteria came from.

Now, that's something, coming to your third point in terms of ethical—which is why I was suggesting in a number of my recommendations that they partner with ICNN, because what we do is we don't tell anybody, 'No, that's it, go away'. What we say is, 'You've fallen short'. There might be imbalance, or there might have been something that was advertorial that wasn't labelled as such. So, what we'll say is, 'This is where we feel you didn't quite meet the mark this time, but we can work with you, whether it's training, support or whatever, over the next six months to raise those standards and then you can reapply'. So, that's our way of really trying to ensure that we get the independent sector to be recognised as quality and reputable.

So, by being a member of ICNN, that, in itself, means that they adhere to ethical standards and high-quality journalism. So, that is one barrier, potentially, that is already removed if that was to be a recommendation. I know that, for the £100,000-a-year pot, one of the criteria was to be a member of ICNN and we did have a lot of people apply, for various reasons, and we do have an entry board that will give all the reasons why they didn't make it. But again, it's for us to really help to raise those standards on a local level and make sure that communities are served by good-quality journalism. Because otherwise, there's not much point in having somebody if they're just a mouthpiece for their political opinions or whatever vested interests they've got.

Thank you, Emma. Does anybody want to respond to Mick's point about specific support for investigative journalism and that sort of thing? Karin.

Just to say that I think that, certainly, independent community journalists would be very keen to engage in investigative journalism and hold local authorities accountable. There are indeed some dedicated investigative journalism sites that are members of ICNN, but first and foremost, they have to pay their bills, they have to be able to quit the day job and they have to be able to cover really basic news like, let's say, council planning applications or noise complaints in a local community, or whatever that may be—so, be able to cover the bread and butter. So, it's really mainly a question about resources and having adequate resources to commit to the work of journalism. And I think that once you have those resources in place then the investigative journalism will follow.

Thank you. Nick, you wanted to come in on this.

Yes. I just want to observe that, clearly, the dangers that something that comes with money and requirements can have a deadening effect are real, but nevertheless, we have some pretty powerful examples, do we not, of how it can, at least in practice, work. I mean, plainly, the BBC's relationship with Government in return for its funding causes enormous amounts of friction, but nevertheless, it does work; it does deliver high-quality journalism. And, indeed, I would argue that the way in which ITV is funded, where it's essentially granted its licence to make money in return for obligations and has to renew that licence every so often—but nevertheless, it does succeed in producing high-quality journalism and questioning the Government itself, and so forth. And frankly, in Wales, as we all know, it's probably the broadcasters that do most of the heavy lifting in the current circumstances.

Thank you. John Griffiths. Can we unmute John, please? Thank you.

Diolch yn fawr, Gadeirydd. I think it was Rachel who said most about the hyperlocal approach, and I think all of us as Assembly Members would be very familiar with the level of interest that there is in local communities as to what's happening on their doorsteps and what might happen. At the moment, I think there is a gap there where a lot of the interest and the demand for information that exists in local communities isn't really being met. There is also the issue that was mentioned of disinformation and misleading information on local Facebook sites and other social media. It's a real issue, I think, that many people understand, and there is an unmet need there. Rachel, you mentioned Caerphilly, I think, as an example of a hyperlocal approach that's succeeded and is succeeding. You also said that it might not be replicable everywhere, and where there's a relatively greater degree of deprivation and a weak business community, it would perhaps make it more difficult to establish that sort of hyperlocal presence. But to what extent is Caerphilly replicable then, do you think—you know, the distinctive aspects that could, hopefully, be rolled out more widely across Wales?

Thank you. Rachel, if you can perhaps tell us a little bit about what the funding model was for Caerphilly and how they get off the ground, as you respond to John.

Well, the Caerphilly Observer and Richard was set up at a similar time to the Port Talbot Magnet. We went into print virtually at the same time as each other. I know Richard quite well, through my research, but also because we were journalists doing the same sort of thing at the same time. And we've done presentations together where he's talked about the successes of Caerphilly and I've talked about the failure of the Port Talbot Magnet, because I think we did have very similar approaches in terms of business models. We went for a traditional print model, which was reliant on advertising, and I think it just became very apparent to us in Port Talbot that the businesses didn't have the spare money, the spare capacity to put their hands in their pockets and buy an advert in the same way as perhaps they did in Caerphilly. I think there were other circumstances in Caerphilly that made it different. I think Richard covered the whole country borough area and his local council, who got it; they understood what he was trying to do quite quickly. He's very entrepreneurial, he lives in the town, he lives in Caerphilly, so there were elements there that made it more likely to succeed, I think.

In Port Talbot, we faced lots of difficulties, lots of closed doors. We weren't from Port Talbot, we were from Swansea, so there was a bit of distance there. But I still think the economics were at the root of it all, and I just think that boils down to more money sloshing around in Caerphilly than in Port Talbot. But there's not less of a need for local news in Port Talbot than there is in Caerphilly, and that's where, I think, we're going to start seeing more and more news black holes, where there are communities that just can't afford to keep journalists. And it's not even about newspapers or digital, really; it's about how you pay for journalists. The print model didn't work in Port Talbot; it has worked in other places really well. The Bristol Cable is another really good example where they've made it work really well and they've done it on the back of excellent talent. They've got brilliant, numbers of people who are young, who have got media skills, they can do graphics and do investigations and go undercover. So, they just had the people there where we really struggled to engage with local people in the same way in Port Talbot.

So, I think that something I've learnt from all of these years that I've worked in hyperlocal is that every community is different, has different needs, has different requirements, has different skills, and each area, almost, needs to have something that's fairly tailor made that grows from the grass roots up and that responds to the needs of that community and the skills of that community. That's not to say you can't create that. One of the models that I'm looking at with Michael Sheen at the moment is what's called the Missouri model, which is where we might establish a local college, an academy, where you would almost have like a teaching hospital but for journalists. So, you would produce an actual newspaper and use that as a way of upskilling young people. It's been tried before in other places, and whether it would work there is something that's open to question. But I felt very strongly that, in Port Talbot, you might have more of a willing engagement with local people who really want to see their young people succeed, so they would be willing to support that. They'd be willing to fund that and put their hands in their pockets and sponsor young people to learn rather than to pay for news. I don't think the people of Port Talbot really ever thought that they wanted to pay for news. But, in Caerphilly, it's been very different. Richard's run it very much as a traditional advertising newspaper. It's built on advertising and he's done really, really well with it. I look at what he's managed to achieve with some envy.

Thank you. Any other Members want to come in at this point? Carwyn Jones. And I'll come back to you then, Emma. Carwyn.

Thank you, Chair. I'm just interested in two points, really, and they have been addressed to some extent by our witnesses. Firstly, if there's a fund of money from Government to fund journalists—and it's absolutely essential, of course, that that can't be used to impose a Government line, if I can put it that way—there are models we can follow. The BBC is one example, perhaps, where there can be sufficient distance between the money to fund local journalism and the Government. The second point, really, I think, is the one that deserves greater explanation. I heard some say that if you adhere to certain editorial guidelines, then you should be able to access some money, which I think is workable. I did hear Rachel, I think it was, say that the model she—I just wanted her to come back on this—is suggesting is that if a particular news outlet reached a certain number of subscribers, then it could access public money. Is there not a danger there that any number of extremist news organisations, regardless of their editorial position, would be able to access public money to spread some extremist views? So, surely, there would need to be some guidance or some rules in place to enable those organisations to access the money, without Government, really, being seen to fund extremism.

Yes, that was my first question when I went over to Norway. I said, 'Aren't you just funding loads of really extremist publications?' And they said 'no' because that threshold is set high enough that those extremist publications never managed to hit the target or hit that threshold. Now, you don't have to run it like that. If that works in Norway, it doesn't mean to say it would work here. I share your reservations, to be honest. But I suppose the point I was trying to make was that it can be very simple to set up; it doesn't have to have a huge machinery of staff and people to measure these funds and to dish them out, if you don't want it to. But we're very lucky in Wales that we have ICNN and that we have a framework in place, so we could measure it in other ways, and it's up to whoever holds the keys to the fund to set those rules. But, yes, I share your reservation, but in Norway they make it work, and it has been a very successful way of having a very varied—. It's a kind of 'let a thousand flowers bloom' approach, where they have successfully managed to subsidise a very varied media without that straying into that extremist territory.

Emma, you wanted to come in before Carwyn asked his question, but you may want to respond to this as well.

Yes, just really quickly, I wanted to—two things are that with the advertising, obviously, there's a lot less advertising, so those that rely on traditional advertising business models have been hit hardest, because those that are very local rely on local businesses, so it's your hairdresser, your nail salon, all the non-essentials that would normally be advertising, particularly in the lead-up to Christmas, they're just not advertising any more. So, again, this reliance on the traditional advertising model is more in danger than ever before, particularly on a very local level.

And then also—. There was one other point, and I can't remember what it was. It'll come to me. I had two points, but I can't remember what they were, but yes, in terms of—. I would have the same reservations as Carwyn and Rachel if you run a numbers thing, because there's always the risk that somebody starts sharing goats on a trampoline in order to get the views and the clicks. I think it has to be about quality, reputable journalism. That is really important.

I've remembered my last point. So, we're talking about replicating the Caerphilly Observer. From our experience, when we first set up the centre for community journalism, for five years we worked intensively with communities and news publishers in Wales—10 of them. So, we either went to a community where there was a news black hole and set up a news publication, or we worked intensively with others, such as Rachel at the Port Talbot Magnet, to see if we could help and support to get them over any pivotal points where they might have to close their doors. What we found is there isn't a one size that fits all; it's very dependent on that community. So, for example, we set up Rhondda People, and we could have lost the website, we could have lost all other social media, but Facebook was very, very, very important in spreading news and information and reaching people, whereas in Cardiff we could have lost everything apart from Twitter. Twitter was far more important to the news title in Cardiff, and that's where they've gone back. It's mainly operating one on Facebook, one on Twitter, as opposed to people who weren't going to the website in the same way. So, I think it's really important, coming back to this issue of having people from the community based in the community and really understanding what that community was, how they access news and information, where they go at the moment, and building that into the business model. So, there definitely isn't a one size that fits all. There are lots of similarities and there are things that we've learned that we could pass on, but we were fortunately in the position that we could say there was no such thing as a failure. If they closed, we could learn from that and try and examine why that didn't succeed in that area.

What we also found that was really important is that if you already have people who already have some kind of social cohesion before you start—. So, if you bring a group of volunteers who don't know each other together, it's far less likely to succeed than if you have somebody—. So, in the Welsh language, for example, we would try and peg it onto the mentrau iaith, because they have targets to reach local communities with news and information. So, if you put it as part of their target that somebody's day job was to do that, and then they had other organisations that could co-work with them, they're far more likely to succeed, because I've been there with them, and I know that on a Tuesday night in a cold church hall, or in a theatre rehearsal room at 9 p.m., and it's pouring down with rain and you just want to go home and have your tea, and if your friend or somebody you know is saying, 'I'll call and pick you up' then you'd feel like you're letting them down. If you don't know the others anyway, you go, 'Oh, they won't miss me tonight', and everybody thinks the same thing.

I think that's a point well made about building on existing networks. Nick Powell. Can we unmute Nick, please? You've muted yourself again, Nick. There we go.

I beg your pardon. Sorry. Yes, to respond to Carwyn Jones, I think a lot of this does depend on the effectiveness of the democratic scrutiny that the Senedd provides. Some of us can remember a magazine with a very short life in the 1980s called Arcade, which was set up with the aid of money that was normally spent subsidising literary magazines, and it closed within a year—it had its funding withdrawn, and it was impossible not to think that was because it had become a useful place for whistleblowers at the Welsh Office to go to. So, we need to rely on you people to scrutinise Government and make sure that the money is not being used as a device to control what's being said.

I don't think they'd get away with shutting Arcade down now. I think there'd be too many voices against that. I have a question I want to ask, but do any other Members want to come in before I do that? David Melding. Can we unmute David, please? Thank you.

I can see that there are two main streams for Government intervention here, and the advertising one is very important because I think that could lead to more efficiency and diversity in things like public appointments, but also in public messaging as well—public health, greening our economy, and getting all that sort of information out. So, I think that's a pretty rich vein, and with an attractive audience—it would be getting to groups that we really want to engage more with. I think there's a clear public good element there, and it's a fairly substantial sum of money potentially. But in terms of the more direct grant bit, what order of magnitude are we in, and how important is the balance we then achieve? Because it does seems to be a third advertising from public sources, a third grant and then a third raised within the organisation, along with the Norway model, is probably what we will need to achieve. But I'd like to know what you think that bit from Government grant would be—what sort of amount.

I was trying, Chair, to find the bit in the Bennett Institute for Public Policy report on the future of democracy, which is out of Cambridge University, and I know they did look at the real problem in Anglo-Saxon countries with the evaporation, really, of local reputable news sources, and they did attribute that leading to higher dissatisfaction being recorded in those democracies. It may be that we politicians deserve to have a lower satisfaction rate, but there did seem to be some correlation with access to reputable news. I think this point about the health of democracy—. Democracy's much more than about holding elections; it's about a democratic culture, and that is an informed, challenging, scrutinising electorate, and I think that's important as well. So, yes, my direct question: how much do we need from Government grant, on a Wales basis? What order of magnitude?

Okay, who wants to put a price tag on this? Because, of course, that will be the first thing that Welsh Government ask us, if we're making recommendations. How much would we need to make a difference? Emma, go on. We won't hold you to this, by the way.

Relatively, not a huge amount at all. Our members right across the UK can operate and survive and pay themselves a wage and get print done for anything between £1,500 and £3,000 a month. There aren't that many cycles in Wales, so if you look at the grant of £8,500 that they had at the start of the pandemic, that ensured that all our members in Wales survived for the next six months. So, we're not talking huge amounts of money, we're not talking millions or hundreds of thousands, we're talking relatively modest amounts for the service that they provide.

They are going to be different. So, for example, the running costs for some, if they're in print or if they've got more staff, are going to be slightly higher. So you could really add in—without adding in massive grants, that could actually mean more staff, more resources. And also, we worked really well with Business Wales last time on offering various services. But I think, at the core, it's about ensuring that—. You know, they don't get statutory notices. Now, I know that Newsquest have said previously that amounts to about 25 per cent of their income. So there's a huge deficit in funding anyway, then if their competitors are also accessing Government ad spend, which our members are not, then actually just a small grant fund—. And, as I said earlier, it goes directly towards paying for the journalism, it goes to pay salaries, it goes towards paying for print. So we're not talking about huge amounts of money. I can go back and I can forward you—after today, we can go back, my colleague Matt and I will look at—. We did a big national survey across the UK looking at how much they would actually need, and we've actually got those figures for Wales as well.

That would be really helpful, I think. Anything further from you, David?

Yes, I think what we're after—that's helpful, but we'd like a figure for Wales. Are we talking less than £1 million? Unlikely, I would have thought. Are we talking about less than £10 million in a total global figure? Likely. But obviously, if we're talking more than £10 million, we're into the fanciful stage straight away in terms of what is likely from Government at the moment. So we need some sort of order of magnitude. That would be helpful.

I can get that to you. I can get that to you after—today or tomorrow. 

That's really helpful. I'm aware that we're running close to the wire and we're almost out of time, but I've got one final question that I'd like to ask.

We've run out of time. I'm sure there are other issues that you might have wanted to add. If there is anything that anybody wants to add—. Emma has already offered us some additional information on the financial side, but if there's anything, as witnesses, you haven't been able to cover today, please do take the opportunity to submit any further evidence on this in writing, focusing, as we have been doing today, on solutions. This has been a really useful session and I'm really grateful to you for managing to focus on potential solutions, because when the situation is such a difficult one it's easy to get caught up in the problems, isn't it?

Yes. Can I just make a comment on paragraph 8 of that report, which is the acceptance of the recommendation that we made in respect of community radio? I'm not really very clear what the acceptance of it actually means, because it accepts support of funding and so on, but then implies, 'Well—'. So, I just wondered whether that might be an opportunity to, in light of that recommendation accepted, just follow through to the community radio organisations that we have and ask them what they think of it and what support they are actually getting, or how they might be, just after their comments on it, because I get the feeling it's an acceptance of something, but doesn't actually commit to delivering anything, and I just thought there might be something useful there.

Well, that's a very valuable point, and let's decide exactly what to do in our private meeting, which will come immediately after this, but I think it's certainly appropriate for us to follow that up.