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| Apart from recently announced legal action, the curtain comes down on the RIFW scandal on the last day the Fourth Assembly met in plenary. (Pic : BBC Wales) |
Yesterday, I covered some of the failures over the course of the term, as well as a last-minute "special performance" by Cirque du Plaid. I couldn't let the Assembly go without revisiting one of the Welsh Government's biggest "whoopsies" - the RIFW scandal - one last time.
Most of the time AMs are capable of acting like grown-ups, and a debate was held on the findings of the Public Accounts Committee (PAC) report into the scandal (Part V). Some credit has to go to the Business Committee for squeezing in a debate before the election – they could've easily let it slide.
Jac o' the North wrote more on this a few days ago and it's well worth a read as always, while in the last few days the Welsh Government announced they'll start legal action against one of the key protagonists in the saga, Lambert Smith Hampton (which was actually one of the recommendations of the committee's report).
Starting off, the Chair of the Committee, Darren Millar AM (Con, Clwyd West) described it as one of the most significant and deeply concerning inquiries undertaken by his committee (clip). He said it was "inexcusable" and subsequently outlined the findings of the report (which I've already covered in detail).
Although the idea behind RIFW was innovative, it was poorly executed due to flaws in Welsh Government's oversight, as well as the fact RIFW was poorly-served by the professionals who were supposed to offer expertise. It exposed numerous flaws in government procedures, line accountability, record-keeping and data retention.
Darren welcomed the First Minister's apology and the Welsh Government's positive response to the report. It was vital that future Welsh governments recognise all of the recommendations to ensure necessary improvements are made to their handling of arms-length bodies, and to ensure such losses to the public purse are never repeated.
Nick Ramsay AM (Con, Monmouth) said the tragedy for him was the number of different parts of Wales affected by the scandal (clip). When it emerged land in Monmouth which was earmarked for a controversial housing development was sold for fraction of market value, the local reaction "bordered on disbelief". The legacy could undermine trust constituents have in government's ability to handle large financial issues – particularly in light of future tax devolution - as ownership and management of land is a key responsibility of government.
Alun Ffred Jones AM (Plaid, Arfon) said it was a damaging chapter for government and people's perceptions of the Assembly (clip), particularly the perception that government isn't careful with its own money and not worried about getting the best value. He found it difficult to believe that no minister was aware of what was happening and was disappointed that nobody's taken responsibility for the fiasco.
Alun said nothing summarised the scandal more succinctly than the 180 degree turn the board made – one moment they agreed to sell the land separately, the next they agreed to sell them in one package. Alun said if even a community council did this "it would raise chuckles" (Oh, the irony! Coincidentally, this appeared to take place at the same time as Plaid's emergency meeting on the Public Health Bill.). He believed it was a cock-up rather than a conspiracy, but it leaves a nasty taste in the mouth.
Jenny Rathbone AM (Lab, Cardiff Central) accepted it was a great idea to invest in urban regeneration during recession (clip). However, she felt sorry for the RIFW board members who were like "lambs to the slaughter" and knew nothing about how to handle land sales. Instead, the Welsh Government should've disposed of the own land then handed the proceeds to RIFW.
It was "unfortunate" that the Welsh Government wasn't tracking what was going on, which meant that the whole thing was out of sight and out of mind. The decision over the land parcel should've been made by ministers, particularly as the "jewel in the crown" Lisvane site would obviously be used for housing as Cardiff expands. In closing, Jenny believed the Welsh Government had learned their lesson.
Aled Roberts AM (Lib Dem, North Wales) was disappointed that the debate was scheduled for the last day, but it was an eye-opener regardless (clip); he doubted whether even a community council would've done some of the things outlined in the report. There was no criticism of the idea, but everything after that was poor, with Aled expressing surprise that the Welsh Government thought just four people meeting for four days a year could discuss these sorts of issues and make decisions – he could only come to the conclusion that board members had been let down.
However, he believed the main weakness was that a civil servant was put in as an observer when it wasn't clear what his role was, with no guidance issued by ministers. Also, the issue of poor record-keeping appears time and time again in these inquiries. This is unacceptable and he wasn't hopeful that the Welsh Government had learned any lessons.
Leader of the Opposition, Andrew Davies (Con, South Wales Central), said the whole situation unfolded from a genuinely sincere attempt to unlock assets (clip), but it was "incomprehensible" that nobody would've realised that some of the land would've increased in value, particularly in Lisvane – it's "not rocket science". Lack of communication appeared time and time again and board members had been cast adrift. The suggestion that the recession meant there needed to be a rush to raise funds for projects was a "red herring" as there was clear evidence that land was already being sold for more than the RIFW valuations at the time.
Responding for the Welsh Government, Communities & Tackling Poverty Minister, Lesley Griffiths (Lab, Wrexham) shared frustrations with AMs and the Committee (clip). RIFW was much needed in 2010, and funding regeneration through recyclable loans was worthwhile during a recession. She shared frustrations that projects weren't brought forward and apologised for that, reiterating the First Minister's apology too.
The delivery was flawed despite the good concept. The government outlined a range and measures to improve oversight of arms-length bodies, though the valuable work and contributions of independent experts on boards and working groups should be acknowledged. The fund was brought under direct ministerial control in 2013 and in January 2016 the Minister said the remaining funds from RIFW would be made available for regeneration projects.
Lesley confirmed that legal proceedings have started against Lambert Smith Hampton, and further legal steps are being kept under review. The Welsh Government accepted all the Committee's recommendations, and said the government will continue to learn lessons and improve policies.
Summing up, Darren Millar repeated that the scandal reflects on the Welsh Government and Assembly as a whole (clip). Due to the significant sums of money involved it was important to rebuild trust – though he appreciated the government's positive response to the recommendation and said their overall response was appropriate. Ministers should've been informed of significant decisions, particularly those involving public assets, and the fact there was no feedback on decisions being made on ministers behalf was "absolutely astonishing".
He shared the opinion that there should be sympathy with board members. He also said the overage clauses were inadequate. However, he spared his ire for the poor record keeping, saying that the fact diaries were deleted after 12 months, so nobody had any idea where key people where and at what meetings, was "appalling and disgusting".
The findings of this report had been echoed in many other PAC reports down the years - AWEMA, grants management and Betsi Cadwaladr board arrangements were mentioned. Something's wrong if lessons aren't learned and he hinted that some of these issues have appeared in their ongoing Life Science Fund inquiry.
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