Thank you very much, Deputy Presiding Officer. For some months, the Finance Committee has been undertaking work in relation to the Assembly Commission’s use of the underspend resulting from the remuneration board’s determination. We've published a report, but the situation has changed during the last few weeks. So, we were hoping that a statement and questions would be a better way of dealing with this, rather than a formal debate on the report. We’ll see if the Members agree on that.

The Finance Committee has shown a keen interest, as I said, in the way in which the Commission approaches budgeting. In determining how to budget for the determination, the practice to date has been for the Commission to budget for the maximum possible spend for each Member or party, and then to use any underspend to fund its investment priorities. We have been concerned about this approach for some time, as we believe it entails that the Commission’s total spend is not sufficiently transparent. As a result, the committee decided to undertake a short inquiry into how the underspend is used and to consider how other Parliaments in the UK and around the world budget for expenditure related to Members’ pay and allowance.

During our inquiry, the remuneration board issued a consultation on the flexibility of the allowances within the determination. That consultation has now resulted in more flexibility for Members’ allowances. This, in turn, has impacted on the Commission’s budgeting decisions, which I will talk about later. 

One of the key areas that we were keen to explore with the Commission during our scrutiny was the way in which it budgets and forecasts its spending. We have previously recommended that the Commission provides an in-year update before the end of each calendar year on the likely determination underspend, along with any significant changes to planned projects to be funded using this underspend. We were pleased to see the Commission included more detail in its information for the 2018-19 budget regarding the funds it estimates will become available from capital and operational budgets, and from the remuneration board’s determination. As a committee, we welcome the steps taken by the Commission during the last budget round, as we believe it aids scrutiny.

One other area of concern for us has been the way in which the Commission has used the underspend to fund investment priorities. We were not comfortable with the principle of the Commission’s budget relying on an underspend to fund projects and priority areas of work, such as the maintenance of the Assembly estate. Although we appreciate this could lead to projects being brought forward, the intention to fund some projects through the underspend, over multiple years, remains a concern for us, as the Commission is then reliant on an unpredictable resource. We believe that core projects should be identified and funded separately.

After considering our report and the remuneration board’s decisions to allow more flexibility over Members’ allowances, the Commission has confirmed, and we welcome this, that it has reviewed its approach to funding projects, and that priority projects identified for completion during 2019-20 will be identified in the budget document, and will now be fully funded from the Commission’s core budget line. We believe this decision will aid scrutiny. Projects will be identified in the Commission’s budget planning, the Finance Committee will scrutinise them and will follow up on them in future years to ensure that the Commission is accountable for delivering projects. In this way, the Commission will be brought into line with the planning and budgeting processes of other directly funded bodies.

However, the Commission has stated that this is likely to result in a compensating increase in the Commission’s core budget, reflecting the expenditure that the underspend would have otherwise funded. This contradicts, on the face of it, a previous recommendation made by the Finance Committee, to which the Commission agreed, namely that its budget should not increase beyond any increase to the Welsh block grant in the remaining years of this Assembly. While we accept that the Commission will not use any underspend from the determination’s budget line, we are concerned that the budget may increase. At a time of austerity, when other public services in Wales are facing extensive and continuing real-term cuts, we highlight the comments made by the Assistant Auditor General for Wales that some of the Commission’s possible projects were probably nice-to-haves, rather than absolute essentials, and we would therefore urge the Commission to consider its priorities carefully to ensure that projects are genuinely required to meet the Commission's strategies and goals. Thank you.