Finance Committee

So, if we move now on to papers to note. We've got a number of papers to note this morning. If we can note them all, but I think I'd like to just point to paper to note 4, which is the letter from the Chief Secretary to the Treasury to the Interparliamentary Finance Committee Forum. His Majesty's Treasury's engagement with the Interparliamentary Finance Committee Forum has been disappointing, and also disappointing the Treasury's engagement with this committee. In the letter, it notes that the Chief Secretary will be coming to Belfast, to the next meeting of the Interparliamentary Finance Committee Forum, so that is to be welcomed. And I'd just like to note for the record that we are pleased that that is happening and that we'll be able to engage with our fellow members of finance committees in that meeting. I think that's a good step forward, and to thank him formally on the record for that. Okay.

So, we'll go to our substantive item this morning. I see we've got some witnesses eager to start this morning. So, item 3 this morning is the financial implications of the Disused Mine and Quarry Tips (Wales) Bill, the evidence session with the Cabinet Secretary and his officials. I just wonder if you'd like to introduce yourself and your officials for the record.

Diolch yn fawr iawn, Cadeirydd. Can I turn to my left, first of all? Kelly.

Kelly Murphy. I head up the implementation team for the new authority. Diolch yn fawr.

And Chris.

Chris Jones, deputy director for mining legacy and reservoir safety.

Fantastic. Bore da. It's good to have you here. I think we've got quite a lot to get through. You're taking your jacket off, so that means you're up for some questions, so that's good. I'd like to start, then, by looking at the background of the Bill and the consultation about the proposals. At the start of this, can you just outline what the Bill does and why you are introducing it?

Yes. Thank you, Chair. This is very much a reflection on the industrial legacy that we have in Wales, primarily the focus being on, of course, coal tips, but also looking beyond that at non-coal tips as well. It's a reflection of more recent events as well, including, in 2020, in Tylorstown, and the slip that we had there, but also, even more recently, Cwmtillery, which I visited. I was up there recently, actually, meeting with some of the residents in the local cafe there, and talking through their experience there—frightening experience, quite frankly—where we had to evacuate homes. But, on a wider basis, it's been acknowledged for a little while by this Government that this legacy needs to be dealt with, and it needs to be dealt with in an intelligent and a very focused way, and possibly in a way that, I suspect, what we do here, subject to the will of the Senedd, will also in many ways be leading, and other nations will be looking at us. So, what we've done is in response to the Law Commission, where we commissioned the Law Commission to look at the existing legislation. They said it was outdated; they identified gaps within the legislative provision made in the 1969 Act. They recommended reform, including a body, a new body, to oversee the safety of disused tips.

So, what we're doing in bringing forward this Bill is to satisfy a programme for government commitment, but also the recommendations that came through the Law Commission, establishing that disused tips authority for Wales, a systematic approach to the assessment, the registration and the monitoring of disused tips throughout Wales, and provisions to deal with in a proactive, preventative way tip instability and threats to tip instability. It also brings forward a range, then, of other provisions, such as the ability to enter sites where there might be that risk to stability; information sharing, to require information to be brought forward, and some offences. So, it satisfies a response to the industrial legacy that we have in a very proactive, preventative way, and the response to that piece of work that we asked the Law Commission to do.

So, essentially, the legislation that's currently in place is out of date; it's not fit for the purpose of dealing with this legacy. So, that's what we're trying to do, Chair.

Are there any parts of the Law Commission's independent review that you haven't taken forward, or anything in there that you'd have liked to but you haven't put into this Bill?

No, the opposite, actually. Because what we've done both in terms of the Law Commission and the White Paper responses is we've done what I think any good proposal for legislation should do: we've responded to, and then adjusted accordingly. So, with the Law Commission, there are differences from some of the recommendations, but the main things are in here. The commission's report, for example, highlighted a number of gaps in the existing legislation, so we've responded to that. So, for example, taking powers within this Bill to have a preventative approach so that you can actually access land, inspect, monitor before the risk becomes the reality. So, you take that preventative approach to have a national, consistent, systematic approach to identifying the tips and categorising the tips as well. That comes from both the Law Commission and the recommendations of the White Paper as well.

The White Paper was interesting because that's helped the development of the Bill as well. There was real consensus in that White Paper around the need for a regime suitable for coal, and also for the future for non-coal tips as well, identifying that we can futureproof through this legislation the safety and stability of all tips within Wales, coal and non-coal. Also, within the White Paper, one of the things that was flagged significantly was—and we've seen this in the work that we've been doing—the complexity of these tips. So, the categorisation we currently have out there, the A, B, C and D, that is already our response to the work that we've been through here in responding. So, we're not even waiting; we're getting on with it. But, as we go forward within this Bill, we'll refine that even further in the categorisation to reflect the complexity. Not every tip is a threat. Not every tip carries that risk. It's to do with proximity to populations, proximity to businesses, proximity to major infrastructure. Some are more rural than others. Others are exceptionally stable. Other tips, as I know within my own area, have actually now been levelled, raised, and they're part of the fabric of the local community. They're either wildlife or recreational or indeed there's building on them.

But that's what we've learned in taking forward both the Law Commission recommendations and also in response to the White Paper responses. We've modified, but the fundamentals of the Law Commission are within here: that body, systematic approach, preventative approach and so on.

I think, Rhianon, did you want to come in on a point there?

Yes, very briefly. In terms of the privately owned coal tips and other classifications, what does this Bill do in terms of being able to create access or any type of oversight around that? And also there's been criticism around classifications. Will there be any sort of review around A, B, C, D?

Rhianon, thank you so much. Two really good questions. Let me deal with the second first, sorry. Let me go to your second question first. The categorisation that we've got in place is already dynamic. So, in the monitoring that is currently going on that I think a lot of the public aren't fully aware of—it's one of the things we've been discussing; we probably need to communicate better—the hundreds of tips that are currently being monitored, and the walking of those sites, the monitoring and the technology being deployed, but it's dynamic for a purpose, Rhianon. Already in recent weeks, we've recategorised some based on our intelligence on the ground on those tips. There's no gut reaction in these things; it's proper, on-the-ground monitoring, evaluation, good engineering and scientific input.

So, there's already a dynamism to it, but, in going forward with this Bill, what we'll actually do is refine that work. It's a good piece of work we already have in place, but we will refine it. I'll be clear to you, Rhianon, and to the committee: there's a reason why this is dynamic, because, if we see the level of threat or instability with the tip changes, we will adjust those categorisations. And then, that means that if they go up—some will go down, by the way—but, if they go up, we will intensify the monitoring, the evaluation and the work that goes on on those tips. That's the purpose of it. You—[Interruption.] Sorry, yes.

Sorry, before you answer Rhianon's second question, why change the lettering to numbering? Is it to be able to go to 1.5, or—? Because people are aware of what they mean. Why change? Does it create a, 'Well, what is it now?' sort of a—? Does it create that anxiety?

I'll come to Chris and my colleagues in a moment for what we've learnt from the—

But, obviously, Rhianon's first question is important as well.

Yes, and then I'll come back to the first question. But, in some ways, it's making it more explainable. So, when you say to people you've got A, B, C, D, for some people it shouts out, 'Are A and B the highest, or is it C and D?' There's something to say around a 1, 2, 3, 4: 1 being those are the ones we really need to put the intensive work in, 2 and so on, and so forth. But, Chris, I don't know if you can add to that.

Only to say that it builds on the current work. We are changing the definitions slightly, which is why there's a slight change. It also makes it easier for Welsh language provision—1, 2, 3, 4 rather than the letters—

A, B, C, Ch.

Yes. So, there are a number of reasons, but primarily it's just to differentiate between the systems. It's worth saying we've worked with the Mining Remediation Authority and other stakeholders on the categorisation in the Bill, and everybody agrees with the general principle.

Okay, thank you. Back to Rhianon's question.

Rhianon, my apologies—I lost the first question in explaining the answer to the second.

[Inaudible.]—the Bill—.

Sorry, you cut out then, Rhianon, sorry.

How does the Bill improve access and oversight in terms of privately owned coal tips or authorised sites?

So, two responses to that. One is—we've got to be crystal clear on this—this doesn't change the liability or the responsibility in terms of ownership. Many of these tips are actually owned privately by private landowners. It has been the way for years, it will continue to be the way; liability rests with them. But what this new body can do is provide that proactive, preventative approach that can work with those landowners to say, 'Are you doing the maintenance that is necessary to avoid an increasing risk from the tip that is on your land?', or alternatively to say, 'You need to do works, perhaps more significant works.' And of course, we have the grant scheme in place to do it.

But Rhianon, what this Bill does is it gives powers of inspection, powers of entry, powers of sharing information as well, so that we are able then—. We anticipate, Rhianon, that actually most of this will be done in collaboration; that's our experience so far. Most landowners when they have an expert authority saying to them, 'You need to do maintenance to keep this safe', some of them, the response will be, 'Crikey, I'm grazing my animals on here, I didn't realise, how can I help?' And it may be as simple, Rhianon, as culvert maintenance and things like that, but it might be more significant, in which case, there is the ability—and we do it already, through the small grants scheme—to provide, through the grants scheme, to actually provide grants then towards that, if the landowner cannot do it themselves. But let me absolutely crystal clear: if you are a landowner, and you own a land that is on a tip, then it is your responsibility—it's your primary responsibility.

The other thing, Rhianon, that this does, by the way, is it allows powers of access to coterminous land. Now, that's a new power there. Because what we recognise is that, sometimes, those culverts, those interventions, the access, and so on, need to come from bordering land. Again, the first point is to do this in collaboration, but there are powers of entry here as well if they need to be deployed. That also, by the way, Chair and Rhianon, applies to emergency situations. So, there are powers within the Bill, so that in an emergency situation—and we have seen them—you can, if you like, take the necessary action immediately, without going through the normal procedures, to get onto the land and fix the problem.

In a similar way to Cwmtillery, I suppose.

Absolutely. Absolutely.

It potentially could have been a situation.

Yes.

Just going back to the data and the classifications and the data that sits behind how you do the classification of these things, of these tips, some of the concerns that were raised in consultation were: why have you proceeded using the data for coal tips for non-coal tips? Is there a risk there that you're describing apples, but you're looking at pears? That type of—in a very, very simple way—but that aspect.

Indeed. It's a fair point, and I think we have to acknowledge that while we have greater clarity, particularly on the mapping and the inspection that's taken place in recent years over coal tips, there is a greater degree of uncertainty over non-coal tips. So, what we've done is, it is an estimation—we've made some assumptions here. But the reality is that what we have here is a 15-year programme. Towards the tenth year of this, we switch the focus onto the non-coal tips, and part of that work will be to do the similar work that we've now done on coal tips, which is to get out there, walk the ground, do the inspection, see where there are threats and where there are not, and look at classifications. But it comes towards the second part of this, the tenth year, when we've done the work that we know we have to do on the coal tips.

But there is another ability within this. I was mentioning the ability of the new authority to actually—. There are powers that are brought forward within this legislation to enable that authority, so if there were an issue with a non-coal tip when this Bill is passed, then they can use the powers within this Bill to gain access, to go in and inspect, to take the necessary measures to work with the landowner. But it's fair to say—it's reflected here in the RIA, and so on—that we do not have the same amount of knowledge and certainty on non-coal tips, but we are taking the powers within this Bill to make sure we can do it. And that is reflected, by the way, in the responses to the consultation as well: that we should futureproof this, because we know that that's the next thing that we have to do. But I just want to make it clear that if there were an issue on a non-coal tip now, when we pass this Bill, we'll have the powers to actually intervene.

But those tips aren't being monitored—or not as closely as coal tips.

Not in the same way. Not in the way that we've done in the last few years in developing this body of knowledge and experience and mapping of the coal tips. So, we are out there now on hundreds of coal tips, inspecting, monitoring, evaluating, putting down scientific technology in the ground to monitor movement, and so on. We do not have the same level of certainty. But we also know, in the categorisation work we've done, the threat that exists from coal tips, so we need to get on with what we know. But then we need to move on to non-coal tips as well. So, within this, it reflects, within the impact assessment, a level of uncertainty that we have about non-coal tips.

You talked there about that sort of time frame for this Bill, and, in the tenth year, you'd be looking at—. That's the plan. Does that go some way to the reason why you've chosen to go for a 15-year appraisal period, or is it that it costs so much, you need to spread it out over a long time to make it palatable? I'm putting words—. You know, put me right.

No, no, I understand exactly what you're saying. It's not the latter option you said; it's very much focused on this is a 15-year period of work. We are putting the quantum of funding in to work through a 10-year period on those higher category tips there, and to carry on the monitoring as well, on other tips as well. But we know that we are going to have to then move on to the non-coal tips. It's a 15-year programme, so it's unusual to—. It would normally be that you'd do the RIA over a 10-year period; this is a 15-year one for a very good reason, that it's a 15-year programme. So, yes, that's the simple answer.

I'll bring Rhianon in in just a second, and just before I bring Rhianon in, we've heard about the £25 million that's been given or been promised to Welsh Government, to do some remediation and to bolster that, from Westminster. The number that's flying around—and rightly or wrongly, I'm not 100 per cent that the figure is correct, because there's a variation of £600 billion to get it all done—where does that fit within this? Or doesn't it fit within this, it's something different? So, if you could just give us a link to how that would interact with this Bill.

Yes. So, it doesn't fit within. In some ways, we're talking about apples and pears. Let me explain. So, in the last couple of years, we've significantly increased the amount of grant funding going into the existing programme of coal tip safety. We anticipate it'll increase more as the years go by. The limiting factor is not, primarily, money; the limiting factor is capacity, both within the Mining Remediation Authority as it currently is, but also within local authority partners as well. We need to build that capacity. And that's actually one of the focuses of the work we're doing outwith the Bill as well, working with training providers, skills, also some programmes that go beyond our borders, to get in the right expertise. Because we're talking about geologists, civil engineers, hydrologists—really well-paid jobs. And there is potential within this space, by the way, for growing local expertise and economy. But that's the constraining element here, and that feeds into the bids coming forward.

So, in the bids coming forward, they need to be robust bids that are drawing down the funding, and ones that can be delivered on the ground, in the timescale that the funding is being given for. So, we've upped the quantum of funding—not just the UK Government—. It is, by the way—. I've just got to say: it is so significant—so significant—that the UK Government have finally put their hand in their pocket and said, 'We're willing to contribute to this.' It's the funding we asked for for this year ahead, recognising those constraints, because we can use that going ahead, on the basis of the applications coming in. And next year, we will do more. And the year after that, we will do more. So, rather than look at some estimate of a headline figure of how much the whole thing is, we need to look at this year by year, building the capacity, and then doing, based on the prioritisation, the work that is needed on the top-priority tips, and then working through them progressively. There is nothing being done like this, I think, probably worldwide, on the scale that we're talking about, and in order to do that, you can't magic up capacity. You have to prioritise which ones need to be done first. We have got bids coming in already of significant quantum. They'll be on my desk—

So, have you got the promise then, or the understanding, that this money will flow year by year, in the same way as you're describing there? Because if you've got an anticipation that you want to do it year on year, you need funding year on year. So, is that something that's been built on? And then I'll bring Rhianon in.

Yes. Certainly in terms of Welsh Government Treasury funding, from us. But also it's worth just reiterating what the Cabinet Secretary has said as well. I mean, let me put it in very colloquial terms: we're really glad that we have a contribution now from UK Government. We want this to be an ongoing partnership, so we've also put in asks for future years as well. So, £25 million we've had now already; our asks for the years going forward will be, for 2026-27, £31 million, and, for 2027-28, just short of £40 million. But, you know, this Bill, as it is, doesn't rely on that. This Bill is actually—

This is separate.

—separate. And the funding that we have in place will take us forward, with the investment that we need to set up the body to do the work on the ground already. What that funding will do, if it materialises in the way that this year's £25 million did, is it will allow us to expedite and expand the work that we're doing. But again, coming back to the point I made, the restraining factor is actually capacity; in the Mining Remediation Authority, in some of the aspects of Natural Resources Wales's work—but that's not a primary constraint—but also in local authority expertise as well. We need to build that at the same time as we build the funding in.

Okay. Thank you very much. Rhianon, I think you've got a line of questioning.

Thank you very much. In regard, then, to the assumptions set out and the uncertainties around the estimates for the financial implications of the Bill, we've been presented a total cost of, I think, £99.1 million, benefits of £143.5 million, over the appraisal period, but not a sort of expected range of values. So, the question here is: why have you taken that approach and what assurances are there for the committee in terms of how the regulatory impact assessment has set out those estimates of those financial implications within the Bill?

Thanks, Rhianon. One thing to say is, we've got a fair degree of certainty, based on the work that we've done and, you know, the sort of Green Book approach—the Treasury Green Book approach—about the costs and so on, and we've applied that across the piece, but there is more uncertainty with the benefits. And it's not unusual—. It's not specific to this Bill. We can calculate, we can quantify some of the benefits, but there are others that are uncertain, so we've left that uncertainty out. Now, in so doing, I have to say, we're probably underestimating the benefits that arise from this Bill.

On the cost side, it's robust, it's drawn on our experience, what we're doing already. We can confidently say we've not only followed the Green Book rules, but we're drawing on the experience of the Mining Remediation Authority and what work needs to be done and the categorisation and so on. It's the benefits that are more uncertain.

But on the benefits, there are recognisable systems in place that we've used for measuring outcomes, such as indirect employment, avoidable costs and welfare improvements. But what we have not included, Rhianon, are those where there are just not those systematic, recognisable ways of measuring some of the benefits. But these would be significant if we could measure them. They are things like impacts on biodiversity, potential carbon dioxide reductions and the improved mental health of communities. When I've been up and spoken to people in Cwmtillery and elsewhere, the burden on them of living with this and so on. There are direct employment opportunities, potential reduction in the loss of life—all of those things. Now, there aren't recognisable, systematic ways of actually quantifying those, so we have discounted them. But, in so doing, Rhianon, we have probably underestimated the benefits that will flow from this Bill. It's beyond, but we are—

And I totally understand that. I suppose, really, it's the approach in terms of generally setting out anticipated ranges of values, whether it's in the costs or whether it's in the sort of more difficult, softer benefits. You've decided to plump for figures. So, it's just, really—. What's your explanation to that, really, is what I'm asking.

Yes. I think the reason we haven't gone for, if you like, a more conventional approach of ranges on the benefits is because of that lack of certainty and lack of ability to quantify and measure some of the benefits. So, what we've done is we've put forward the benefits that we can measure.

On the costs, we're actually much more robust because we've done a couple of things here. We've drawn on the evidence from the work that we've been doing, on the evidence that we have from other sponsored bodies on the set-up and establishment costs of new bodies—because there will be a new body set up from this—and the implications of the establishment of those new bodies, from experience, on those things like indirect employment, welfare improvements and so on. So, we can actually tangibly measure, based on track record, what's happened.

We've also, of course, built into that—I think wisely—a contingency cost. So, 25 per cent on IT costs, recognising that some people will say, 'Well, IT is one of those greater ones that does have variance within it', and also on establishment costs generally, the setting up of the administration. So, there's 25 per cent contingency and 5 per cent on staff cost. So, Rhianon, on the cost side, we think what we've got here is very robust indeed. I think, on the benefit side, we've got as much certainty as we can. Rather than going for ranges, we've said, 'Here’s what we can pretty much certainly say—here's the benefit.' But it is, we think, an underestimation because we can't quantify a wider range of benefits.

I'm just conscious that we're about half way through our session, and we're only probably about a third of the way through the questions. So, if I could ask for brevity, then that would be fantastic, please, just so we can get through quite a complicated Bill. Otherwise, we will be here until midday, and I don't think the Cabinet Secretary wants to be here with us until midday. There we are. Rhianon.

Right, okay, I'm going to try to combine some of these questions. How have you used data, in regard to the number and categories of coal tips, to drive these calculations of the financial implications of the Bill? And can you explain your assumptions relating to the assessment of non-coal tips, and how you've calculated the number of non-coal tips categorised?

Yes, indeed, and I'll try and be brief on this. So, we used the most up-to-date information that was available at the time the RIA was finalised on the number and category of all disused coal tips in Wales. These have been informed by the work that's been carried out on the ground in inspections by the MRA on behalf of the Welsh Government. We've also discussed resource implications of the carrying out of inspections. So, we've engaged with MRA, NRW and local authorities before finalising things like the final staffing levels that will be needed for the new authority to carry out its functions.

And in terms of the non-coal tips, as I say, there's greater uncertainty over this, so we've used a very rough estimate. But it is a rough estimate of 20,000. But, in reality, I have to say, I'm not sure that anybody at this moment knows the true number or the extent or the location of some of these tips, because some of them go back to things like metal mining in centuries gone by, and so on. So, there's a deal of work to be done here on that. So, there we are—I'll keep it short.

Thank you. Rhianon.

Finally, I don't know if we’ve touched upon this to a certain extent, but what is the evidence to support your assumptions in regard to the measures to be taken by the new authority resulting in an 80 per cent reduction in costs associated with the coal tip failures?

So, we've got to acknowledge, as I mentioned before, there's some uncertainty in regard to the benefits, and this is a bit of a—. In pioneering this work, because it will be, I suspect, world leading, we don't have a specific evidence base to consider when we're compiling the RIA in some aspects. So, that's why, just to go back to the previous answer I gave, Chair, we're only including the benefits that we can quantify. We're leaving out the other ones. But we believe that the estimated 80 per cent reduction in costs with tip failures is a prudent estimate. And I think the experience and knowledge that we're going to gain over the next decade is actually going to be used by other countries when they look at how they deal with their industrial legacy. Just out of interest for the committee, we are already having enquiries from other countries about how we're taking this forward and what they can learn from us.

Eighty per cent is a big number.

Yes, indeed. Yes.

Mike Hedges. There you are—you're fine, Mike. Sorry, the mic was off for a sec.

Diolch, Cadeirydd. I think you've talked around some of the questions I'm about to ask, so if you've got nothing further to add, I'm sure the Chair will be really pleased. But how much has the Welsh Government currently allocated to the coal tip safety grant, and for what elements? And can you explain how it'll be used under the proposals in the Bill, as set out in the RIA?

Thank you, Mike. So, to date, we've made £60 million available for delivery, but let me make it more specific to a year. In 2024-25, last year through to this year, we've allocated just short of £20 million to local authorities and NRW through the coal tip safety grant. Let me just make it clear, as well, that a lot of people won't see the work that's going on. Sometimes this is major capital infrastructure, which we will see on the ground more evidently. 'Other' is actually things like clearing culverts, maintaining culverts and so on—it's going on, but nobody actually sees it. So, Mike, it might be helpful for you, and the committee as well, just to say we've received applications, going forward, for 2025-26, from 10 local authorities and NRW. So, these are the next financial years. This includes requests for funding for work totalling £32 million. And work is proposed on 130 tips, including that minor maintenance work, but also major capital proposals, some of which go up to the multimillion pounds—to £5 million or £6 million. So, I just want to make a point here: I want to make announcements on these as soon as we possibly can, because some of them are pressing—we need to pass the budget.

I thought you might say that. Grant applications exceed some of the money available. That happens in most grants, so that’s not a criticism; that’s just an observation. It’s assumed the grant will be at that level over the 13 years of the regime. How do you expect the authorities to prioritise applications for future funding, and what are the risks of this shortfall?

Well, actually, rather than being stable in the grant funding, we anticipate, Mike, that it will actually rise. As I was just saying, in terms of 2024-25 to 2025-26, we think, as we’re building this expertise already, even before the Bill comes forward, we’re going to have more local authorities, and NRW and others, coming forward and saying, 'We want to draw this down. We think we can do it.' The constraining factor is not the money; the constraining factor is the capacity. One of the things we’ve been engaged with, Mike, and the committee will need to be aware, is with local authorities last year—and we’ll do the same this year—to actually work with them on the bid applications, to say, 'Okay, this is a very ambitious bid. Now, is it actually achievable? Have you got the people in place, and can you deliver it in time?' So, hence last year’s was revised down slightly, because when we went back to local authorities and others, they agreed with us, 'That’s actually a bit optimistic, so let’s go for this chunk now.' But some of those, then, were carried forward into this year. So, it will actually rise as the years go by. We’ve seen that growth year on year.

The other thing, importantly, Mike, to say is if we have major events like Tylorstown, which itself—I was up there the other day—is a five-year programme, in excess of £20 million, or the Cwmtillerys of this world as well, then I anticipate local authorities will be coming back to Government for conversations on those significant issues.

I want to talk about something I actually know about, which is appeals—planning appeals, environmental appeals. We don’t know how many appeals there are going to be. I can guarantee one thing: there will be appeals. There will be objections, and people appealing against decisions and actions. How are you calculating the cost of appeals?

We’ve worked with Planning and Environment Decisions Wales on this, based on their experience, including their experience with things like reservoir safety. So, there is some track record to draw on, in comparable but different sectors of policy. So, working with them, we’ve assumed that 25 per cent of notices requiring an owner of land to carry out operations will be the subject of appeal, and, working with PEDW again, we anticipate that we’re looking at around 40 notices to carry out improvements, of which there will be 25 per cent per year—25 per cent, roughly—that will be subject to appeal. So, that means 10 appeals a year. Then, we’ve worked with PEDW to break that down, on their experience, into how much would be written submissions on appeals, or oral submissions. So, we’re anticipating, based on work with PEDW, that 20 per cent would be oral and 80 per cent would be written appeals. And that takes us, Mike, then, to a sum of a maximum of £100,000 a year on appeals. So, it’s based on some past experiences in comparable but different areas of appeals.

Again, from my experience of appeals—and other people may have different experiences—if, in this case, you actually tell somebody they have to dig out and clear a ditch that is filling with water and which is causing the water to move up and affecting the water table, and it’s going to cost them £200 or £300, I would imagine you’d have very few, if any, appeals. If, however, you’re coming to things that are in the hundreds of thousands of pounds mark, and you’re asking people to pay for them, then I think you’ll have quite a lot of appeals. Do you see that happening?

I think your analysis is probably fair. Most of the work that’s going on with landowners on the ground is in that collaborative approach of, 'Look you need to clear the culverts and do this, that and the other.' And they just get on with it, because they recognise their responsibility. If it is a larger amount, I guess, Mike, you're right, that's the human reaction—'I'd like to appeal that, I'd like to suggest that it's a lower amount or that I'm not liable at all.' Or, to be honest, they might well say, 'I don't have the wherewithal to do the work. I didn't realise that I was sitting on top of a coal tip', and they might come to us. Most of the applications to us currently come from NRW or local authorities but, sometimes, landowners will come forward and say, and then we get into the process of engagement with them and say, 'Well, let's talk through this, then.' But what we will not do is allow a tip to jeopardise human welfare and safety.

Well, I think we're all on the same page here, but what we also know is that a lot of the land that is going to be picked up will be common land. How are you going to deal with that?

Chris, could I turn to you, in terms of common land and ownership?

Yes. There is some uncertainty around some of the land, with unregistered owners and unknown owners. What this Bill will do is allow the authority to go in and actually do work on that land. It will then have the ability to seek out who the owner is and try to recover costs. But if it can't, the authority will cover the cost in order to make sure that the tip is safe.

And does that mean, then, that the local authority would then come to the Welsh Government and say, 'Well, we've done everything we can. We've got a huge hole in our budget now. Please fill it'?

Well, the difference is between the routine work—. So, if we identify that there's an issue to be done, it will be done, and our first call is on the landowner. And even on common land—sometimes even on common land—the ownership that underlies the commoners' association, or whoever, can be identified. But Chris is right in what he's saying—if the owner cannot be identified or is not easily identifiable immediately and there's a need to do work, within this Bill there are the powers to go onto that land or coterminous land that is affecting the stability of that tip and do the work and then to seek to reclaim that funding from the owner. But the first priority is the safety, and the second one then becomes, 'Let's actually make sure that we can get the money back for the taxpayer.'

But the other aspect, then, is if there is something like Tylorstown or Cwmtillery, and so on, in that case we would undoubtedly expect calls from local authorities and others to say, 'Can you help us out in this situation?' But the funding that's been put within this Bill and within the RIA to the new authority, going forward, is designed to take a preventative and proactive approach to avoid these situations, and that does include, by the way, engaging with the landowners to avoid these situations coming about, and it does include those powers to go on, but it also includes the quantum of funding to do the day-to-day, regular maintenance to avoid these things becoming a problem. But, yes, on a bigger thing, Mike, you're right—if you suddenly turned around and said, 'Well, you've got a £0.25 million job on a site', I think the landowner there, whoever that might be, might go, 'Oh, heck. Can I do this?' I've got to be clear to the committee: the landowner has the primary responsibility for this. This Bill does not create new responsibilities for the Welsh Government, NRW or the mine authority to take over responsibility; it is the owner's responsibility for the land. But there are powers within this where we can step in if need be.

Okay. Mike.

The last question from me, and it's nothing to do with tips, but it's analogous: as you know, there was a fire underground in the Gowerton and Gorseinon area that lasted for several years and the coal underground had combusted. Now, that had actually taken place on common land and, eventually, the Welsh Government, the local authority and others took responsibility for it, because chasing after all of the commoners would be incredibly difficult and you'd probably have very few people admitting to being a commoner if the only thing they got from it was a charge. Would you see something similar happening on common land regarding tips?

No. There's nothing within this Bill to take over ownership of land and take on responsibility for it. The responsibility remains with the landowner, but we can go in and make good if we can't identify the owner, and then seek to claw back the funds that have been expended, or to engage with that landowner again, retrospectively, if they say, 'Well, I simply can't do it.'

And does it give you the power to do it forcefully, I suppose, even against the wishes of a landowner, and then bill the landowner, essentially?

Yes. So, there are powers within this Bill, powers of entry, particularly in an emergency situation and, where we can't identify the owner, to go on and do the necessary works, so you avoid a slip or you avoid a threat. But the work that we've already done on the inspection, the mapping, the identification of these, should help us significantly in this, because that work is already going on with landowners on the ground, and we're trying to work through those areas where we don't have identifiable landowners.

So, other than an emergency situation, you should, in theory, know where the next problem might arise and be able to sort it out before it happens.

Exactly right. Drawing from the consultation—you asked right at the outset of this what have we learnt—one of the aspects that was strong within the consultation was taking a proactive preventative approach. So, the powers that we are bringing forward in this Bill, subject to Senedd consent, give us the ability to go onto land—by the way, working in collaboration with the landowner. Genuinely, I think our experience already is that most landowners will say, 'Yes, come on, direct me to what I need to do. I want to be a responsible landowner.' But it does also have those powers where, if there were to be refusal, or we can't identify the owner, or there's an emergency situation, we can go on and do the necessary work, and then seek to sort out who's responsible, who's paying for it, and so on.

Okay.

Just to clarify the answer you gave to me: on common land, you would pursue all commoners to pay for it.

I want to be absolutely clear with you, Mike: common land is not described in the Bill in that way, so that there is a specific—. What we have are the powers to enter any piece of land, including common land, and also then to identify the responsible landowner or landowners to actually pay for the work that is being done. So, there isn't a common land provision within this Bill; our approach is to all land.

It's all land, but some land is common land and it's owned by the commoners. I think you've said 'yes' to me in a roundabout sort of way. If you have to do work on common land, you will pursue all commoners for the cost.

No, that's not quite the same, because there's a distinction between commoners—sorry, we're getting into historical commoners legislation; Mike knows it well, and I do as well from my area. So, sometimes the commoners themselves are not the owners of the land. Sometimes the owners are, as you know, historic rights that go back centuries, but the commoners manage the land.

So, I suppose every situation would be slightly different, and this Bill allows you to have the powers that you need to make something safe—

Indeed.

—and then to pursue whoever is responsible.

Indeed. And the focus, for clarity, is on the landowners, as opposed to those who might—

Land users, I suppose.

—use the land. It's the landowner who has responsibility, and always has been and will continue when this Bill goes forward.

Diolch yn fawr. I'll bring Sam in.

Diolch, Chair, and good morning, Cabinet Secretary. Thank you for your time, and to your team as well. As the Bill sets out, there's a new body to be established. Could you briefly outline why you felt it was more prudent to set up a new body rather than adapt an existing one, please?

Yes, indeed. We looked at different options, Sam, including options around adapting an existing body to act as an authority, or the introduction of a new public body. The appraisal that we did confirmed that there was no single existing body that could fulfil the extended remit that's described within this Bill within existing resources. So, the body that was most likely to fulfil most of the criteria—the Mining Remediation Authority, for example—is not directly accountable to Welsh Ministers. On that basis, we came to the conclusion that it was appropriate, rational, to set up a new body directly accountable to Welsh Ministers and to the people of Wales. This is a significant issue we're trying to deal with; there needs to be that line of accountability.

But there are also within the White Paper, Sam, some significant benefits for putting in place a single supervisory body. This development that we've touched on already, this body, will develop significant specialised technical skills that will be of benefit to itself but also to local authorities and other partners in the management of disused tips. It’ll have a dedicated remit towards the safety of these disused tips in the way that no other body can do or has done. There will be independent oversight of the regime to make sure that we’ve got a consistent expert approach right across Wales. It’s the economies of scale, I have to say as well, in the procurement of services, because we are talking about expertise here, as I’ve described—geological, hydrological, and so on.

Sorry, can I just check? You believe that couldn’t have been done by adapting an existing body.

Exactly right. There was no one single body that could do that range of things and also have that direct line of accountability as well.

All right. Thanks. And then, can you just remind me of the number of staff you expect to be within this new authority and the staffing cost estimated for that as well?

Yes, indeed. Within the RIA, we’ve set out an authority requiring 77 staff members, 33 of whom will be operational staff doing the assessments, the inspections, the monitoring of tips, collecting data—technical advisers. Thirty four will be corporate staff members, with the back-office functions—legal, HR, finance, IT, governance, strategy—and 10 staff members in the senior category, including the chair, chief executive and five non-executive directors.

Yes. Thank you.

Sorry, on that point, you’re setting up a body that is for coal tip safety. It would sharpen the mind if they were physically based near a coal tip. So, can I get an assurance that they won’t be based in one of the cities and actually be based close to a coal tip, so that it sharpens the mind as to what they’re actually deemed to be doing? Because that would be a very strong indication of, ‘Well, we’re in it together’.

But which coal tip? Would it be north Wales, north-east, or would it be south Wales?

The question is 'a coal tip'—that it is within line of sight of a coal tip, rather than based far away from a coal tip. It could be something to consider as a proposal at least, because it would—

I firmly understand your question, and, just to say, we have existing Welsh Government estate and offices within areas of coal tips. So, I understand what you’re saying and we will be wanting this new authority to deliver value for money in its choice of premises, and I’m sure your words have been well heard.

Thanks, Chair. Cabinet Secretary, you mentioned the number of staff being around 77 staff that you are estimating to deliver this work. The staffing costs you’ve estimated are, I think, around £79 million over the 15 years. You’ve included in that a 10 per cent uplift in salaries and a 5 per cent contingency as well. That means the average salary cost per person is around £70,000. Are you sure you’re getting value for money from that estimate? Are you overestimating, do you think, the cost of that, considering that that's probably higher than most headteacher salaries and probably twice the starting salary of a doctor? The average salary is over £70,000. Are you convinced that’s not been overestimated?

No, I don’t think it’s overestimated. I think the contingency is a wise contingency as well. It’s recognising that, within this body, when I talk about it being world leading, some of the roles within it in terms of technical expertise will be world leading. They require payment that is commensurate with what is available outside there in the world of things such as civil engineering, hydrological surveys, all of that. These are not low-paid jobs. And there’s a benefit to that, I’ve got to say as well, Sam, because, in establishing this body here in Wales, we develop that world-leading expertise, but we’ll need to pay the commensurate salaries. We’ve also drawn on some of the more back-office ones. Again, we’ve compared to the establishment of other sponsored bodies, and we’ve looked at what the cost of those have been, and we’ve built in some contingency. Chris, I don’t know if you want to add anything, because you’ve been deep and buried in the bowels of the workings out of this.

Only to say we’ve said there are some significant capacity and capability issues, and I think, as part of that, we have to realise that there are going to be some recruitment issues. So, we have to take that into account, as well as the specialist nature of the roles that we’re talking about.

Yes, and those points are fair. I guess it’s also ensuring value for money for taxpayers with this as well, because, for the most senior staff costs, you've estimated about £190,000—more than the salary of the First Minister—for managing 76 other people. As a ratio, they're being paid £190,000 to manage 76 other people. I'm just wondering if you're assured that that is value for money, as well as capturing the right quality of people.

Yes, we are. We are confident in the figures that we've put forward—that that will recruit the right people in. And, do you know, this body has got a serious piece of work to do. We want the right people in there of the right quality and calibre as well. It's probably fair to reflect as well that there's a 10 per cent uplift here in the figures reflecting some of the technical staff, because we know there's a challenge to recruit the right people into these areas, and we're recognising that.

Just on that challenge to recruit, the Welsh Local Government Association have, as you'll know, pointed out some of the risks, perhaps, to their organisation, in local authorities and others, of staff, I'm not saying being pinched but certainly moving across to a new organisation. How do you expect to mitigate some of that risk?

We're really cognisant of that, and we've been engaged with the WLGA all the way through this process of bringing this forward. What we want to do here is not only create this new body with this high level of expertise, but also to uplift the wider sector within Wales as well, including within local authorities. So, I just give you that clear assurance that we'll continue to work with the WLGA to make sure that we're lifting the whole skills base here, because we need good people in local authorities as well.

Are you concerned, then, with the job cuts that have been announced in universities, where these people are being, potentially, trained up, that it's creating a problem down the line in that we'll be losing some of the future generations of people that would be able to do this sort of work, because the lecturers won't be there to be able to train them up?

We've already identified that we need to strengthen our work specifically on this skills area, not only with our universities, which we will do, but also with other opportunities that we have. So, some of this will be working with organisations. For example, we've had some initial discussions with an organisation called Talent Beyond Boundaries. They launched their programme in Wales in September. They're looking at, for example, how you match internationally displaced skilled workers with Welsh employers to address skill shortages. We have people out there who have these skills, or where they can transfer their existing skill set and upgrade them to work within this, either within local authorities or within the new authority there.

I suppose it's similar to the WARD refugee doctors scheme—

Very much.

—in a very different field, but similar type of—

Why shouldn't we have a public body, and also local authority workers, leading in this, which draws on the best of the upskilling we can do, and drawing on our universities and the workforce from here within Wales, and within the wider UK, but also make use, if this is going to be something where we really push the boundaries on expertise, of those people with those skills, who may have lost their own homes and livelihoods and will be here? That's where something like Talent Beyond Boundaries, which is working, by the way, very well at the moment—. They recently launched in Wales, last autumn, but it's already working very well in Scotland and England. So, we need to draw on all the talents here to get the quantum of expertise and uplift everybody in Wales on this.

Thanks, Chair. Whilst I've just been challenging some of the, perhaps, estimations around value for money on the staffing side, on your non-staffing costs, there's been a challenge too from another committee on the IT costs, in particular, perhaps potentially being underestimated, and you'll know the benefit of getting technology right sooner rather than later in terms of keeping costs down in the long run. I'm just interested to know how you've come to that calculation—I think it was £5.9 million, off the top of my head; I could have that slightly wrong—and how you've got assurance that that is about the right amount to be able to deliver the IT needs that this new authority will need.

Listen, that's a really good question, and the IT one is always the one that you worry about a little bit. This is based, again, on experience of what's been done recently. But it's also that that £5.9 million you mentioned involves IT infrastructure, software systems and consumables. So, what we have got are some experienced officials with backgrounds in the establishment of these IT systems for other bodies that have been set up as well. So, we've learnt the lessons from the establishment of other bodies in bringing forward these figures. They're based on the current production costs, and they include implementation partner support during the transition period, licence spends, running costs of cloud environments, and so on. And we've also put £40,000 per year to be earmarked for ongoing licensing and support costs as well. Now, we didn't put a disproportionate amount of detail on the face of the RIA due to the multiplicity of data around this and also professional judgment, but it's drawn on the experience not only of what the costs currently are out there, but actually the experience of putting some of these things into place and lessons learnt from previous—

Yes. So, you're confident that that number is about right.

Yes, indeed.

Okay.

We're going to run over slightly, if that's okay with you.

Yes, indeed. I have a UK Minister waiting for me at a bilateral but, no, I'm happy, let's keep on going.

That's fine, then. This is more important. [Laughter.]

I'll be really brief, Chair—

No, that's fine.

—with my last two quick questions. In terms of the contingency, I've already mentioned the 5 per cent on the staffing side, and you've got a 25 per cent contingency on the non-staffing side. Could you quickly comment, in a moment, as to how you got to that number? And then the second quick question for a brief response is to understand briefly your engagement with others where costs will fall, such as the future generations commissioner and auditor general.

Yes. So, the contingency that we've built in here is for any of those unexpected challenges, and we think that it's a reasonable and sensible contingency. So, things like price fluctuations, unforeseen issues that may arise—

Is that the usual level of contingency for things like this?

It's just based on the experience of officials putting together new bodies recently. So, just based on that experience and knowledge alone, we thought that it was reasonable.

Okay, thanks.

And on the future generations commissioner, we've been engaging with representatives from the commissioner's office and also the Auditor General for Wales as well, prior to the introduction of the Bill. That continues, by the way, especially with the auditor general as well, to make sure that we respond to any issues that they raise on the costs identified. We're also liaising with the auditor general's office. We anticipate updating the RIA after Stage 2 of scrutiny, based on those discussions.

Okay. Thanks, Chair.

And finally, how do you plan to evaluate the work of the authority going forward, as well as monitoring the success of the Bill, because obviously it's a longer period? Normally, you'd have a review period after a certain number of years, but obviously this is a longer period that we're looking at. So, does that change?

Yes. So, we'll put an evaluation in place on this based on the ideas that are outlined in the Bill, so the key things that we need to evaluate and that we measure. And there are good standard practices, standard models of evaluation that we can apply to this. We will, of course, do the five-year review as well, which will be a good staging point to say, 'How is this doing?', because of the establishment, the running of it for the first few years. We'll set out—. Now, I've got to confess that this is not my degree of expertise, but I am told that part of the approach that we'll be taking forward will be through—and I'm looking to you, Chair, for your understanding and knowledge of this—theory of change models. I'm looking at your clerks as well. Now, okay, everybody's going—. We have people who understand this stuff, and if you want more we can write to you on it. And also, logic models to provide that framework for evaluation. And the other thing is that, in the fundamentals of this, we are expecting the authority to publish regular stats on the number of tips, their inspection regime, their status, to understand the direct impact of the authority's effectiveness.

Thank you very much. We might well take you up on the theory of change and the logic models to understand it a bit more, because it's interesting stuff and it's good to see what sort of approach the Government is taking on that, but we won't go into that now. Thank you so much for your time this morning. I know we've run over a little bit, but it was worth it to get the information on the record. Of course, there will be a transcript available for you to check for accuracy.

So, I propose, in accordance with Standing Order 17.42(ix), that the committee resolves to exclude the public from the remainder of the meeting. Is everyone content? I see that they are. We'll go into private session, therefore. Thank you.