Graham Benfield, WCVA

Anna Nicholl, WCVA

Lord Richard, Richard Commission

Huw Thomas, Richard Commission

Dr Laura McAllister, Richard Commission

Ted Rowlands, Richard Commission

Paul Valerio, Richard Commission

Peter Price, Richard Commission

Sir Michael Wheeler–Booth, Richard Commission

Eira Davies, Richard Commission

Lord Richard

Thank you very much for coming. I wonder if you could do two things for us: one is identify yourself formally for the sake of the record and then perhaps you'd be kind enough to open up to discussion for 5 or 10 minutes, then we can pursue whatever lines we think might be helpful, if that's okay with you?

Graham Benfield

Yes, certainly. If it's okay I'll be joined by Anna when she arrives. I gather she's just there. My name is Graham Benfield. I'm the Chief Executive of Wales Council for Voluntary Action (WCVA) and we're very pleased to be submitting evidence today. The purpose of WCVA is to represent the views of the voluntary sector and not for profit sector in Wales. We have over 900 members, and of the larger organisations and our members it is about 15,000, which represents about half of the known voluntary organisations in Wales, which is about 30,000. In putting together the submission, it is based on the work we have done and do regularly through our policy briefings where we go to different parts of Wales, each of the regions of Wales, regularly, and consult with our membership on issues of the day, and this gives us a fairly broad view of small organisations, large organisations, across all parts of Wales.

The second part of the content of the submission is based on the Assembly Liaison Officer's network. Some voluntary organisations have officers, part of whose job or whole job is in terms of working with the Assembly. These are the experts, if you like. Thirdly, the submission has also been agreed by the board of WCVA which consists of 36 organisations, representatives of organisations whom are again representative across the whole spectrum of voluntary sector activity in Wales from arts to sports to welfare, et cetera.

So, we're fairly confident that the thrust of what we have to say is shared among the sector in Wales in as far as one possibly can be. We have not commented on some of your questions where there was not a settled view, but, if we have time, I can reflect upon the range of views that we had. We have concentrated on those questions where there is a fairly clear view and where there is direct voluntary sector experience and input. So, having said that, the first question is the impact of the Assembly on the voluntary sector. I think there is no doubt that most organisations would say that the impact of the Assembly, or the relationship between the voluntary sector and the Assembly, has led to a greater degree of involvement in government policy, development, and decision–making.

So, this is partly and mainly through the scheme, the section in the Government of Wales Act – a piece of primary legislation – and everything that flows from that scheme, which is recorded in the submission and I think you have supplementary documentation on that, but it's also about the way in which the Assembly has worked and the fact that it is there and that it is much easier; there is much more contact, much more access and a much more greater willingness of the Government to listen and to be involved in that.

So, my first point is that the Assembly has been good in terms of the voluntary sector, in terms of listening and in terms of access. I think that is reflected in the impact that the sector has had on some of the activities of the Assembly and in terms of the work that was done in relation to the Children's Commissioner, of which you'll know a fair amount, but also in terms of the use of secondary legislation and I'm thinking there of Shelter's use to improve the situation in relation to homelessness. Having said all that, the other message which I think came through fairly clearly and constantly was that there is a frustration about the complexity of what the Assembly can and can't do and confusion at various levels again between what it can and can't do. I think there is confusion between the roles of the National Assembly for Wales and the Welsh Assembly Government. People don't easily understand the distinction between the two. There is confusion between the roles of AMs and MPs. Some organisations were not clear who they should be going to about what. There is confusion about the roles of the Welsh Assembly Government and the Westminster Government, particularly on various issues where devolved and non–devolved overlap. There is confusion between the split between Whitehall and Cardiff in terms of Civil Service, and there is a lack of understanding between the roles of pre–legislation, primary legislation, secondary legislation and the regulations which follow from that.

So, there is a fair amount of confusion around about who is doing what and where you go. The result of that is that even those officers who were working very directly with the Assembly weren't always sure of its exact boundaries and its exact powers, and, of course, that complexity or that confusion limits participation to either the most resourced or the most determined because it's a maze to work your way through. That, in turn, leads to confusion over whether policy announcements, reviews and funding cover the UK or England only, particularly announcements from non–devolved departments, or from the Chancellor, or from the Prime Minister. Thirdly, it can make integrated policies more difficult when you try to mix between devolved and non–devolved functions. We give some examples in our paper.

Clearly, if you look at an area like youth and justice, or youth justice, and one where you have a devolved policy about youth, one where you have non–devolved policies about justice, when you put the two together you have a conceptual if not a practical problem and we give a few examples of that in the paper. Having said that, I think it is important that we acknowledge the successes of the system. We're particularly interested in the commitment to pre–legislative scrutiny. I've mentioned the use of secondary legislation. As I say, Shelter have shown how useful it can be, although again people have difficulties in understanding exactly how to use it, how to influence when it arises. We have, I think, things to learn from the situation with primary legislation and the Children's Commissioner in the sense of how difficult it is to actually get primary legislation time and to get it through, as opposed to opting out of Westminster policies.

Lord Richard

How much does that actually infringe upon your work in Wales?

Graham Benfield

In terms of what?

Lord Richard

You said not getting primary legislation through, or trying to get it through and not succeeding.

Graham Benfield

I think it is in terms of how people think about what it is they want to achieve. It is quite important. I mean, we are dependent, , really, on thinking about what is possible. If you take something like the Charity Act, which we mention, or the reform of the Charity Act coming, the question around that is a number of different questions, and one is: will it get parliamentary time, full stop, for any of our interests? Will it when it emerges actually reflect accurately enough what we want, as opposed to what England wants? At the moment we wouldn't really begin to conceive of having a Welsh Charity Bill because the process of getting that through Westminster would be so horrendous that it just would be too big a mountain to climb.

Lord Richard

If it's going to be UK – an England and Wales board – and you've got particular Welsh preoccupations, how would you try and influence legislation?

Graham Benfield

How would we influence at the moment?

Lord Richard

How would you try to influence it? Who would you lobby, talk to? How would you go about it?

Graham Benfield

In terms of the present system?

Lord Richard

If there is going to be a new Charities Act, which is going to be England and Wales, and you have specifically Welsh preoccupations and considerations you want to take into account, how would you actually go about making sure that that happened?

Graham Benfield

How we would do it would be that we would have to try and liaise with MPs and Welsh MPs, but we'd need to try and encourage the Home Office to take our views into account. The Home Office at the moment has made it fairly clear they're operating on this from an English perspective, so then we get to the question of who should we be liaising with from a Welsh point of view, and that is by no means clear. Clearly, we would talk to the Wales Office; we would talk to the Assembly – we are talking to the Assembly; we are talking to Assembly officials; but, the process of how the Welsh view gets fed into that process is one of the complexities.

Huw Thomas

Could I clarify that point? Are you saying that if you go to the Home Office they say, "Oh, you're the Wales Council. You need to go and talk to X?" They actually don't want to deal with you; is that what you're saying?

Graham Benfield

They see their primary responsibility as their liaison with English organisations, yes.

Dr Laura McAllister

I was going to follow up a point on the Charities Act. Is your argument, then, that you'd prefer to see a Charities Act in Wales, should the Assembly have primary legislative powers, because it would be more in tune with the particular profile of the voluntary sector and the charity sector in Wales, or is it purely a timing issue because you say somewhere else in the paper that legislation is unlikely to feature on the Westminster calendar until 2005? What is the argument?

Graham Benfield

The argument is two things, I think. The original proposals, as they emerged from the Home Office on the reform of the Charities Act, initially we were quite happy with. There is now considerable lobbying going on from organisations outside Wales which will actually change the Charity Act, or, as we understand it – haven't seen it yet, of course – in a way that we would find quite difficult in Wales or would not be particularly helpful to us.

Lord Richard

Can you give examples?

Graham Benfield

One of the important things in the Recommended Charities Act, the report which preceded – precedes – the legislation, is around abolishing the distinctions, enabling charities to have a wider range of powers to raise income and trade. At the moment, if you're a charity, you're not allowed to trade; you have to set up a separate trading arm which feeds the money back into the main charity. Under the proposals, that was going to be abolished. Charities could, in effect, trade and raise income in a much easier way without so many restrictions.

From a Welsh point of view and given our concern and the Assembly's commitment to the growth of what we call social enterprise and social economy, that would have been a very important reform and one we'd like to see and it chimes in with what I say about Assembly policy and what we want to see. What appears to be happening at the moment, is that there are some charities in England campaigning against doing that because they want to keep it distinct; they're quite happy as they are and they don't particularly want that to be liberalised, so then you would have a difference of view. If you ask the question who is the Home Office most likely to be talking to about this, who are they most likely to take notice of, i.e. a whole range of very large charities in England or WCVA, I think they're more likely to do the latter.

Again, if you look at the situation in Scotland – because charity law is an England and Wales element; it doesn't apply to Scotland and Northern Ireland – again there is a commitment from the new Scottish Executive to a Charity Act, but, again, it may turn out the proposals the Scottish Executive are putting forward would be proposals, we'd not be happy with at all because what may be proposed there is very much that the Scottish Executive, will be the regulator, and that would cause us all sorts of constitutional problems.

Dr Laura McAllister

A very minor point about if you were to push ahead in a hypothetical situation with a Charity Act which related to Wales alone, what about charities which crossed the border between Wales and England, because clearly at the moment there are plenty of those. Would you imagine that being a fillip to those organisations to create a Welsh National Association, or can you envisage there being difficulties there with separate legislation relating to England?

Graham Benfield

This is a question which applies to Scotland, and Northern Ireland to a lesser extent. Obviously, you want your charity legislation and regulation to be compatible between the four nations of the UK – it doesn't make sense just to be different for difference sake – but, there is an increasing tendency anyway post Assembly and in terms of accountability, particularly financial accountability, where the Assembly is putting money into the voluntary sector, that you do need to account for your activities and you do need to manage your activities separately from your activities in England already, so, yes, this would push it that way. The reverse of this, of course, is that by remaining, having an England and Wales regulator, it tends to make us, , very much a junior partner in terms of regulation and how the Charities Commission views everything and is making efforts to open an office in Wales, and part of the reform is to have a single commissioner, but the organisation, primarily because of its work and because of where it comes from and because of who it thinks about, who it consults, remains primarily an English–based organisation with Wales as an afterthought.

Ted Rowlands

Can I challenge that? You've used the term English charities. Over the years I've dealt with local organisations seeking charitable support, indeed mostly not from within Wales but from UK charities, I've never felt or sensed that they were English charities. They were UK charities. RNIB is a UK charity, a UK organisation. A lot of the big charitable funders are UK funders. In dealings I've had with them, they don't talk as if they're English; they talk as if they're United Kingdom ones. Don't you think, in many cases, organisations that are seeking funding from these charities will find it more difficult to attract that kind of support if you've got two charity laws?

Graham Benfield

I think I'm not sure that it would have any effect in terms of who is supporting who. The organisations that you mention of course have a strong Welsh arm and a strong Welsh identity already and it's a question of balance; it's a question of which way are you going. We're certainly not arguing in general that there is a prescribed formula that all UK organisations should devolve into the four distinct parts. On the other hand, those UK charities who have really not caught on to the fact that there is devolution and the Assembly, and a lot of the policies that they're working for and with have changed, are increasingly becoming at a disadvantage. So, there is a spectrum here and it's which way you go. It's whether you go towards a greater degree of independence or whether you stay with the existing situation whereby, for UK charities, things are very much still, I would say, UK–based or London–based.

Ted Rowlands

English–based.

Graham Benfield

Okay. Well, UK–based. Few charities actually operate in all four countries, so there are far more England and Wales charities, partly because of the Charity Commission, than there are England, Scotland, Northern Ireland and Wales charities.

Ted Rowlands

For example, I'm involved at the moment in trying to run a number of charitable foundations for the new theatre and arts centre. In my contact with those organisations, we don't sense they're English. They behave as a UK charity. I don't feel that the language you're using frankly reflects the experience I've had anyway.

Graham Benfield

Are you talking about donors?

Ted Rowlands

Yes, from…

Graham Benfield

From those who are registered as charities.

Ted Rowlands

They're all registered as charities.

Graham Benfield

The grant giving trusts, most of the foundations, et cetera, are UK–based, or some are international–based.

Ted Rowlands

I'm suggesting a charity law fundamentally different in England and Wales. You talk about confusions and difficulties, particularly to those who are seeking to tap into those organisations.

Graham Benfield

We simply gave it as an example of something you might debate and look at if the Assembly had legislative powers.

Lord Richard

Yes, but on the face of it, not knowing a vast amount about charity law, I can't see what it is that you would want different in Wales from the way in which charities are organised in England. What legal sort of differentiations are there?

Graham Benfield

At the moment there are none because the law is the same.

Lord Richard

But, what gives you this Welsh perspective which leads you to think about having a Welsh Charities Act?

Graham Benfield

It is about making, e, the regulation and it depends again on how it is reformed in the current next few years and whether that actually does reflect the needs of the sector. The other needs of the sector here are that we have of our 30,000 organisations, the vast majority of them are very, very small organisations, and therefore they need a light touch regulator rather than in England where you have a much larger number of organisations.

Paul Valerio

Isn't the need in England for the English Charities Act exactly the same as in Wales? What you're saying is that if you had a Welsh ability to change things, you could jump the queue and get things done quicker in Wales rather than in England?

Graham Benfield

That would be the case, yes.

Vivienne Sugar

Perhaps it would be interesting for us to have more evidence about what's proposed in the Scottish Charities Act because I think it will pick up some of the same points about charities doing much more community regeneration work in Scotland and Wales compared with England. That's why this ability to trade is so important. I'm also still concerned about the circumstances under which a charity would decide where to register if you had different rules in England and different rules in Wales. This idea of the light touch for small organisations, surely that would apply in England as well.

Graham Benfield

It depends on the way in which you reform the present law and the way in which you reform the present regulator. One of the issues around that is whether all organisations, unless you have an income of 10,000 pounds, should actually be exempt at all from regulation. There will be views about that. Clearly, there will be issues there, where there is a slight degree of change.

Sir Michael Wheeler–Booth

Can I ask a rather uninformed question? Supposing you could do what you like, get what you like in this field, what would you want, what would you say?

Graham Benfield

In general?

Sir Michael Wheeler–Booth

Yes, speaking for your organisation.

Graham Benfield

I think the thrust of what people are saying is that they want clarity in terms of the distinction between different layers of government because they are confused.

Sir Michael Wheeler–Booth

That's quite clear in your paper, but it was really in changes in the system which are being considered both in Scotland and south of the border. What would you like for Wales in terms of the structure?

Graham Benfield

As I say, we would like something that people do identify with and it's much more accessible in Wales. We would like a Charity Act which is proportionate in terms of regulation in relation to the size of organisation. We would like to see, again, a legal structure that is simple for people to have and is consistent and is as unrestrictive as possible while ensuring there is some accountability.

Sir Michael Wheeler–Booth

How does this differ from what is being proposed in Scotland? There it is more Executive dominated? That's a question.

Graham Benfield

The proposals in Scotland have yet to emerge. The example that I was giving is that if you could go down a different Scottish Executive route, you might want to go down a different road again from the way in which the Home Office in England and Wales is going, so it's still being debated which way you would go, but the issue in Scotland is more about having the regulator at arms length from government.

Peter Price

Can I pick you up on something you said a moment ago and seek an explanation? You said few charities operate in all four nations of the UK and most in England and Wales. Why do you think this is?

Graham Benfield

I think it's partly historical in terms of – I think the regulator again has something to do with this. In Scotland, I think the law, because of, I suppose, its perception of separateness, has been greater. I suppose geography again makes it separate. So, many charities have developed separately in Scotland, are independent in Scotland. In Northern Ireland, I think the same sorts of things apply although it's more complicated obviously in Northern Ireland. In Northern Ireland, many charities have links to the south as much as they do to the rest of Britain. So, it's a mix of geography, regulation and history,

Peter Price

The first two things you were talking about was the law and regulator in common. If you separated Wales and England, wouldn't you then be more likely to have some separation in those current England and Wales charities with the possibility that the larger projects in Wales would then have to look to a smaller pool and, given that the nature of distribution of wealth in the United Kingdom is such that on the English side of the border the charities would probably be better resourced, you would have a double impact – difficult to accommodate large projects from a small pool – and that you wouldn't get any redistributive effect from England to Wales, which may or may not be taking place now, but I suppose that it probably is.

Graham Benfield

I think that's a very controversial question about how far that distribution is taking place. I think one of the difficulties is it's very difficult to generalise completely because almost every charity has a slightly different structure, slightly different fund–raising. Some will be heavily subsidised from the rest of the UK; others will feel that they're not, that their fund–raising is going far too much to headquarters. To a degree, what you describe is happening in Wales. There is a trend post–devolution towards voluntary organisations and charities separating, , or exercising a greater degree of autonomy from their headquarters. I think that the much publicised situation with the Children's Society shows the dangers of being tied completely to an England and Wales structure, and many of the UK charities are in a continual state of reorganisation and there are ways in which they operate in Wales that change quite dramatically over time and not always to the benefit of Wales because they're looking at the greater picture and, in some respects, Wales is a more expensive and difficult terrain to operate in.

Lord Richard

Looking at paragraphs 26 to 30 of your paper, which in some ways is very much happenstance to what this Commission is supposed to be looking at, the potential use of primary legislative powers. Can I be the devil's advocate for a moment and put to you a question that you might have to meet in relation to all those four paragraphs? 26, you talk of the lack of a general power to make payments, but it hasn't prevented funding so far. 28, you talk about the new Charity Act for Wales, which we've been exploring. 29, you say the Assembly should have powers over the benefit system. 30, you want independence in Brussels. How realistic do you really think this is?

Graham Benfield

I think that the case for more powers is slightly wider than that. I think what you have to look at is what will happen over the next few years if the Assembly does not have more powers, in the light of other things that are going on. In particular, if you look at the proposals for regional assemblies, one of the things that has been very important in our work is to be able to say Wales is a nation and we want to sit round the table with England, with Scotland and with Northern Ireland and we want to exercise our influence, if you like, on Europe, or on Westminster, or on anyone else on that basis.

Lord Richard

You couldn't do it. Paragraph 30 is asking for independence negotiated with the Commission, to negotiate state aid cases with the Commission, to negotiate all sorts of things with the Commission, cutting out the UK Government.

Graham Benfield

I think what it's arguing for is a greater degree of taking into account the needs of Wales in terms of how you negotiate.

Lord Richard

It's not what you do say. You say that if Wales had the power to set it's own state aid it might negotiate with the EC directly. That's not on, is it, because the European Union is an association of individual member states. Wales by definition is not a member state.

Graham Benfield

Is it not how, though, we ensure that the Welsh view, as part of the UK delegation or UK representation, is actually represented?

Lord Richard

But what we've heard so far about Europe is, on the whole, the thing is working not unreasonably well.

Graham Benfield

I think there may well be in the future. It is possible to conceive, is it not, a difference of view about some of the things in Europe from Westminster Government as opposed to the Assembly Government?

Lord Richard

I find it difficult to make that connection actually. I don't see how you can move Wales outside of the basic structure of the European Union, which is, in a sense, what you are arguing for.

Graham Benfield

It's about giving Wales a greater voice in its negotiations.

Lord Richard

Inside the UK structure? That's another matter. Fine.

Graham Benfield

Similarly, I think the point about some of the other things, it's how do you maximise, how do you get, if you like, the non–devolved powers, how do you get those departments to work more closely with Wales and, indeed, with the Assembly to get a more joined–up approach?

Vivienne Sugar

I want to pursue the question of benefits and get you to talk a bit more about examples of where UK policy on benefits is getting in the way of some of the policies that the Assembly and the organisations that you represent want to pursue. In paragraph 17, you talk about youth justice and the fact that young people are in difficulty, are not being treated as children and are not being covered by the extending entitlement arrangements once they get into the hands of the local youth offender team and through to Youth Justice Boards' arrangements. I thought I'd picked up somewhere else in the paper something again about Communities First and regeneration issues, but just expand what you mean by the kind of differences in benefits that would help achieve different social policies in Wales. Give some practical examples.

Graham Benfield

I think it's the ability to be able to link the benefit system and some of the regulation around the benefit system to payments of what we would call transitional labour market measures, so that instead of getting paid benefit to do nothing, you can actually look at that sum of money that the person would receive as a benefit and how you could use that with other policies and other forms of money to actually create intermediary labour market jobs, and it's that flexibility. At the moment…

Vivienne Sugar

Hasn't flexibility increased enormously over the last 5 years? Aren't there lots of different schemes that are about encouraging enterprise and acquisition of skills, and so on? What is the different thing that you want to do in Wales?

Ted Rowlands

Employment zones do that. I mean that's exactly what they're set up to do. The employment zone in the eastern valleys has that capacity to be flexible on funding benefits relating to work.

Graham Benfield

I don't think it can move the benefit into a wage, though, can it? It can't quite go that far. That's the point. Employment zones, yes, have been marvellous. There has been a lot more flexibility, but the final step of whether you can use benefit as wage has not yet happened. You can say, well, that's a UK issue. Fine. I'm just saying that's the sort of thing that perhaps policies in Wales might want to do ahead of what might happen in the rest of the UK.

Lord Richard

But the problem is the same, isn't it?

Graham Benfield

Absolutely. You could say that many of the problems are the same in various other urban parts of the UK, but the question is whether the Welsh Assembly has gone some way to doing this, to adopt different approaches based on its greater potential to join up government, which is much more difficult in Whitehall, I think, to do that, to provide integrated approaches. I think the Assembly has been reasonably good at trying to do that. The tension, though, I think comes when those policies in Wales come up against or come into conflict with non–devolved policies. A good example of that would be the thrust of the two mental health policies where you have a potential act in Parliament that has a degree of coerciveness in its approach that contrasts with the Assembly policy, which is much more community–based and has a preventative focus. You can have a difference of emphasis.

Vivienne Sugar

I just want to say that what I was after was some more practical examples from the experience of your members working in different areas on different schemes – and I would be very happy to receive that over the next few weeks if it's not available this morning – but the case that you're making, with all due respect, at the moment about benefits is actually quite thin.

Ted Rowlands

May I suggest it's also not reflecting what is actually happening. I know a little bit about all the various innovative interesting thinking going on in social employment; for example, in this town there is a very imaginative innovative scheme on social employment agencies in operation at the moment. What's happening is that the Chancellor of the Exchequer and the Department of Work and Pensions are trying a variety of different methods across the UK in pilot projects, including those across the border – they're in Bridgend, they're in the eastern valleys and up in the north–east – and testing out these different methods. I would have thought that's hopefully one of the best of all worlds where we can check things out across a UK experience and, on the basis of that, work out what is the best. What is wrong with that?

Graham Benfield

It's one approach.

Ted Rowlands

It's multiple approaches.

Graham Benfield

It's how far those innovative approaches are able to chime in and support Assembly approaches.

Huw Thomas

Can I partly declare an interest because I'm actually doing a study? It relates to an area of WCVA's activity and I therefore would actually share some of the views you're putting forward about the benefits issue, but I'd like to move to the mental health because…

Ted Rowlands

Huw, can I – Sector Skills Council? In the same paragraph 17, you say the Assembly should have responsibility for the Sector Skills Council. I'm not up to full speed. These are successor bodies to national training organisations, industry–wide based organisations trying to develop, as I understand it, comprehensive portable skills and credits that will travel everywhere. Isn't the Sector Skills Council concept by its very nature going to be a cross–border one, therefore one that's industry–wide? It's not geographically–wide; it's industry–wide. What's your experience on this that leads you to believe the Sector Skills Council should be devolved?

Graham Benfield

I think it's the question of, from our perspective, the difference of the emphasis in that in the past we had a unitary but devolved national training organisation for the voluntary sector. It was a unitary body, but it was highly devolved between the four nations and that combination worked very well. We're in a it's now called – is there isn't now a need for a National Training Sector Skills Council for the voluntary sector. We don't agree with that perception and I think we have shown in different countries, not just in Wales, that there are useful things one can do in relation to training and management and meeting the needs and skills gap at a national level. I mean, there are particular skills gaps at the moment, I think, that arise particularly from Assembly policy.

. I'm thinking particularly in relation to Communities First where you need from local areas, , a whole range of fairly skilled people who can work in the community. It's taken an awfully long time for that training need, that skill need, to be organised and to be met. The purpose of these sorts of organisations, – is to foresee what those skills needs are and to do something about it, if there is therefore a Welsh dimension to that which arises directly out of Welsh policies.

Ted Rowlands

The Voluntary Sector Skills Council is the one that particularly…

Graham Benfield

I wouldn't necessarily argue for Sector Skills Councils. I mean, as such, it should all be devolved. What I am saying is there is quite a lot of skills forecasting and things on the ground that can be done at a Wales level.

Huw Thomas

Can I move to mental health?

Lord Richard

I want to move on to paragraphs 41 before we leave that.

Huw Thomas

I want to test – because in the mental health, it's right to say, Graham, there is the divergence between the policies which have been worked in Wales and what emerged, in a sense, from the Westminster side. Both of those approaches, of course, have been subject to consultations within the various sectors. My question is to what extent, when you're making representations to the Assembly, are you keeping your counterparts, your colleagues, in England aware of the lines that you're doing, so that, in a sense, the voluntary sector is not representing two different points of view?

Graham Benfield

On the generic issues like the lottery, for instance, or Charity Act, then there will be close liaison, but not necessarily agreement between the countries, but there will be that liaison. It becomes more complicated the more specialist the issue becomes and it would need to be, , the mental health groups in Wales. A question would really be: have the mental health groups in Wales – MIND Cymru, and all these – how far have they been talking to their counterparts in England in relation to the Mental Health Act, and whether there is a common voluntary sector position? I would assume they are. .

Anna Nicholl

I think that is going on, so that, say, MIND Cymru would be talking closely with the UK body and working in mental health networks in Wales and so there is liaison at those different levels, but, in Wales, the Assembly is taking one approach, as is the Health and Social Care Committee and the Welsh Assembly Government, backed by the voluntary sector mental health groups in Wales, and, as far as I understand it, at a UK level, several of the mental health groups are working together, perhaps forming similar views and with similar concerns around mental health policies, but there is still a different policy emerging at a UK government level.

Graham Benfield

So, if I understand that right, what it's saying is, yes, they would be, and all of the mental health charities are broadly critical of the Mental Health Act, I think. So, they are working together.

Lord Richard

Can we move to paragraphs 41 in relation to the Assembly and Whitehall, particularly the relations between Whitehall and the voluntary sector in Wales? You say you've got strong relations with the Welsh Assembly. I'm sure that's true. Paragraph 42 seems to indicate that your relationship with the UK Government, with Whitehall, is now worse on non–devolved matters than it was before. Can you expand on that because on non–devolved matters I'm not sure what the difference is?

Graham Benfield

Why would it change? I would say it's never been strong. I would say that there is a sort of sense – it goes back to the complexity and confusion argument. On a day–to–day basis that you often get the reply, "Well, isn't that a matter for the Assembly?" or, "If you have a view, can you not communicate that through the Assembly?" As it says here, there is sometimes confusion– either genuine confusion or sometimes really a lack of thinking about why that relationship is necessary because of devolution, so the Assembly is sort of seen as something that's there between that relationship.

Lord Richard

Going to a clarity point?

Graham Benfield

I think it's a clarity point, yes. It's partly a cultural point, in the sense that I think it is quite difficult, and we've given some examples of where policy is being considered and set in Westminster and Whitehall – what arrangements are put in place as a routine measure to consult with Wales.

Lord Richard

How did you do it before devolution?

Graham Benfield

We always do it on an issue by issue basis. The comment here is simply that, since devolution, it has become slightly more complicated.

Lord Richard

The mechanisms are the same?

Graham Benfield

The mechanisms are: do we go through the Wales Office? Do we go through the Assembly? Do we go direct?

Lord Richard

What's the answer?

Graham Benfield

People depend on different issues. There are sensitivities, depending on which one you go on – "Why haven't you come to the Assembly?"

Sir Michael Wheeler–Booth

I thought your paragraph 42 was one of the most interesting in basically a very well–argued paper, but it was the one that was least clear, the reasons for it, and you offered I think to put in a supplementary note in response to an earlier question. If you could justify the last sentence in paragraph 42 with examples, I think that would be very helpful to us, and, in particular, to show why it's been made more difficult since devolution, because this is a very important point.

Graham Benfield

Yes, I think you're right to focus on that. It's always been difficult, but, certainly, if you go out and talk to organisations, they'll say, "Well, we seem to have a relationship somehow with Europe. We feel as though we've got a relationship with the Assembly," but, when you ask about Westminster, it's like a big black hole, and that's partly to do with the complexities of the relationship with what sort of organisation they are, whether they're an England and Wales organisation All we can say is that this is the view that's come back in the sense that people feel they have a relationship with Europe, feel they have a relationship with the Assembly and not with Westminster.

Sir Michael Wheeler–Booth

Can I make one further request in connection with paragraph 52, which, it seems to me, is again a very key one? It may be that the arrangements which are being put in place as a result of the Government and Prime Minister's announcements would slightly need a bit of modification of what you say there, but there is the more general point concerning the voluntary sector scheme. I note in your bit of paper you gave us that you refer to the Act and the need for the Assembly to lay a new scheme now, within a year of the election, something like that.

Graham Benfield

That's right.

Sir Michael Wheeler–Booth

There is going to be another scheme, but how realistic is it to expect Whitehall to comply with the old scheme or, indeed, the new scheme? If there is anything you can tell us when you write back or write to us in your supplementary, it would be very interesting. It's not easy, is it?

Graham Benfield

The predecessor of the scheme, of course, in the other countries is the compact, which was the Labour Party that made a major commitment to the sector when it came into power. So, you have a compact between English voluntary organisations, , and Whitehall departments, and you havd the same in Wales but developed into the scheme, and the same in Northern Ireland and Scotland. That problem was identified about 5 years ago in terms of what you really neede is a UK compact about how non–devolved departments would work in the three countries, and, at the time, that proved to be problematic.

Eira Davies

Can I just take you to paragraph 19 where you refer to the Treasury cross–cutting review? Can you just expand on that, please, and perhaps explain how you think that should have been handled and what the benefits would have been to do a similar one for Wales?

Graham Benfield

Yes, I think this one was a good example of the sort of confusion and complexity of the situation that we're in at the moment. The Treasury, as part of the build–up to the last spending review, set up a cross–cutting review of the role of the sector in delivering public services and it was not clear what the geographical scope of that review was, even though the Treasury is a non–devolved department. It was dealing partly with tax issues, i.e., V.A.T – irrecoverable V.A.T; equally, it was dealing with what you might call England–only issues, which were various things it might want to do to remove obstacles for the voluntary sector to deliver more public services, which is a policy that Westminster Government is much committed to, a policy where I think the Assembly is slightly more equivocal.

So, what you had in that review was a mix, in fact, of devolved and non–devolved issues. Really, there was no Welsh involvement with that either from the sector or from the Welsh Assembly Government. Then, when the consequences came out, it made lots and lots of different recommendations. It rejected the point about irrecoverable V.A.T, but made a close linkage to that, as sort of compensation, that there would be a fund that was set up for organisations who were directly handicapped by irrecoverable V.A.T. It's a big issue for service delivery organisations.

Eira Davies

So, you had a positive outcome from that?

Graham Benfield

We have a complicated outcome because then the Treasury set up this new fund called futurebuilders. This was about a year ago. Then you have the question of does that apply to UK? Will there be consequential money for the Assembly? How will the Assembly then use its powers to use that, given that remember this money is sort of linked back to compensation for V.A.T? All of that is a muddle, which takes a long time to sort out because you can ask the questions, but the questions often take some time to answer and, at every stage, it lacks clarity in terms of involvement. I suppose what we'd have liked to have seen is a much greater clarity of thinking about when something is being set up. I've given the examples we have which affect us. There just isn't that clarity of thinking That simply wastes lots of time and energy, which people could be much better using elsewhere.

Eira Davies

On the last point in paragraph 56 you make the point that Wales is potentially losing out on significant funding opportunities and you represent a common experience here.

Graham Benfield

Yes, again it's a re–emphasis of that point. When a new funding initiative is announcedthe geographical scope of i is by no means clear, particularly for non–devolved departments. I think the media also confuse this. They don't help. So, , the Chancellor or David Blunkett, or somebody will announce a new initiative.. The media will imply, either wrongly or by default, that it applies certainly to England and Wales. The difficulty for us and our members is they then think, "Ah, yes, this does apply; this applies to us," and they say, "Where is it?" and then you go into the usual thing of: is there a consequential or not a consequential? Is the Assembly going to go down this road or is it not going to go down this road? That whole process causes a degree of frustration.

Lord Richard

Can I thank you very much indeed for coming, both yourself and Miss Nicholl. It has been very useful and, I think, illuminating. We've had a perspective from you, which I personally find extremely interesting and thought–provoking. Thank you very much.