Last Autumn, the Public Accounts and Public Administration Committee (PAPAC) scrutinised Amgueddfa Cymru’s Final Report for 2021-22 (its ‘2021-22 Accounts’). This followed a reported dispute between its senior management team and its board of directors. The Auditor General for Wales also published a Public Interest Report (‘PIR’) about the related governance arrangements (November 2023).
The PAPAC sought evidence from the Welsh Government, given it had been party to the Settlement Agreement for Amgueddfa Cymru’s former Director General.
This term, it has considered the responses to its report from Amgueddfa Cymru and the Welsh Government.
Ahead of the Senedd’s debate on the PAPAC report on 27 November, this article looks at some of the findings.
Inadequate policies to deal with concerns
On 5 December 2022, following mediation, which was jointly undertaken by the Trustees and the Welsh Government, Amgueddfa Cymru settled the claims made by the former Director General. He had submitted a complaint to the Welsh Government about the former President in June 2021, alleging inappropriate actions and behaviour. However, the Director General told auditors he had been raising governance concerns with Amgueddfa Cymru’s former President and the Welsh Government since December 2020.
The dispute escalated, with the Director General submitting grievances in September 2021 and January 2022, as well as claims to an employment tribunal in October 2021 and August 2022.
But the Auditor General for Wales noted Amgueddfa Cymru did not have adequate policies in place to deal with such concerns and grievances. Its arrangements applied only to the staff it employed and they did not cover grievances raised by senior staff and involving a non-executive Board member, such as the former President.
The PAPAC was “extremely concerned” that Amgueddfa Cymru’s arrangements for dealing with the complaints and grievances proved “wholly unsatisfactory in resolving a foreseeable risk”. It sought reassurance that Amgueddfa Cymru now had suitable arrangements in place.
Speaking about his PIR, the Auditor General for Wales said:
I hope my report serves as a reminder to all public bodies of the importance of the proper application of governance frameworks and principles to safeguard public money and public confidence.
The PAPAC recommended the Welsh Government consider reviewing the grievance policies at all its arm’s length bodies to ensure the issues at Amgueddfa Cymru are not repeated elsewhere.
The Welsh Government rejected this recommendation. While it would provide advice, the Welsh Government said “Grievance policies, together with other HR policies, are the responsibility of individual Accounting Officers”.
“Amgueddfa Cymru has not been able to demonstrate it acted in the best interests of the public purse”
At the time of the Auditor General for Wales’ PIR (November 2023), the overall potential cost to the public purse was over £750,000. This included the Settlement Agreement with the former Director General, the ill-health retirement of the former Chief Operating Officer/Deputy Director General (who had also submitted complaints and grievances), the related legal and advisory fees.
Under the Settlement Agreement, the potential cost of payments to, or in relation of, the former Director General was £325,698. This included salary and on-costs of £225,698 for the period 17 November 2022 (the date from which the former Director General ceased to discharge his duties, excepting six prior engagements he had agreed to fulfil) to 30 September 2024. This equated to a notice period of 22 months, instead of the 12 months set out in the former Director General’s contract of employment.
The Auditor General for Wales concluded the terms of the Settlement Agreement were “significant” and, in his view, novel, contentious and repercussive. The PAPAC agreed, noting:
Amgueddfa Cymru has not been able to demonstrate it acted in the best interests of the public purse, as shortcomings in its governance processes and internal procedures for handling disputes left the organisation exposed to the risk of an employment dispute becoming litigious, which resulted in significant financial costs.
Full candour is “essential in facilitating effective parliamentary and audit scrutiny”
Amgueddfa Cymru told the PAPAC it had acted under the legal advice it had received. It would have taken another year for a tribunal case to conclude and that may have cost more than double the value of the Settlement Agreement.
On 1 March 2024 and after challenge by PAPAC, Amgueddfa Cymru provided the full legal advice and the business case for the Settlement Agreement.
The PAPAC had been concerned, throughout the scrutiny process, about the availability of “crucial information”. While not making a related recommendation, it encouraged all public bodies to reflect on the candour of their dealings with it, all Senedd Committees and the Auditor General for Wales, noting it is “essential in facilitating effective parliamentary and audit scrutiny”.
To move to a self-assessment model for ‘Tailored Reviews’ is “hugely concerning”
The Welsh Government’s response to the issues at Amgueddfa Cymru included bringing forward its ‘Tailored Review’ of the organisation.
The objective of the Welsh Government’s Tailored Review process is to provide assurance to Ministers, the Principal Accounting Officer and the Arm’s-Length Bodies on whether they “remain fit for purpose and are well governed and properly accountable”.
The Independent Tailored Review Panel (the ‘Panel’) published its Final Report on 13 July 2023, making 77 recommendations under five themes. The themes included governance, which the Panel said was the “most important topic” for its consultees and to which it “devoted considerable space” in its report.
On 14 December 2023, the Welsh Government’s Chief Operating Officer told the PAPAC it had paused its Tailored Reviews of individual organisations while it implemented and adapted a new self-assessment model.
The PAPAC said the move to a self-assessment model was “hugely concerning”, particularly given the serious failings that occurred at Amgueddfa Cymru. It cautioned that a “light-touch approach” may mean that the Welsh Government may not detect issues, such as those at Amgueddfa Cymru, which “could lead to problems escalating significantly”. The PAPAC called on the Welsh Government to update the Committee once it had concluded its rollout of the self-assessment model for reviewing arm’s length bodies, which it agreed to do.
Next steps
The Senedd will debate the PAPAC’s report on 27 November, which you can follow on Senedd TV.
Article by Joanne McCarthy, Senedd Research, Welsh Parliament
