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Tuesday, February 26, 2013

Over-optimism may scupper single environment body claims

On Thursday the Assembly's Finance Committee will be scrutinising the order that will effect the merger of the Countryside Council for Wales, Environment Agency Wales and the Forestry Commission into a single environment body to be known as Natural Resources Wales. We have asked to look at this because of the very sparse detail of the costs of merger in this document and what looks like massive over-optimism with regards to potential savings.

The decision to scrutinse this order further appears to be supported by an article on the BBC website which says that the new body is facing a £50m pensions deficit. Furthermore, the ambition to save £158 million over 10 years as a result of the merger, largely predicated on a new computer system also looks to be in jeopardy.  The BBC say that not only is the pension deficit larger than expected but also that the IT system is not ready.

They report that the business case for the merger allocated £19m to cover the pension debt of amalgamating staff into a single organisation, but the Welsh government has now admitted that is unrealistic. In addition Emyr Roberts, the chief executive of Natural Resources Wales has conceded that the IT system is unlikely to work properly for a year or two.

I support this merger on the grounds of delivering a more joined up service, but it is not helped when the Welsh Government claim savings for the change that do not stand up to scrutiny. Thursday's meeting could be interesting.

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