Board Minutes - February 2024

Present: Baroness Tanni Grey-Thompson (Chair), Ian Bancroft (Vice Chair), Delyth Evans, Nicola Mead-Batten, Prof Leigh Robinson, Judi Rhys, Rajma Begum, Philip Tilley, Nuria Zolle, Chris Jenkins, Rhian Gibson; Hannah Bruce

Staff: Brian Davies (CEO), Emma Wilkins, Rachel Davies, Owen Hathway, Owen Lewis, James Owens, Wendy Yardley (minutes)

Staff Observers:

External: Neil Welch (Welsh Government)

1.   Welcome/Apologies for absence

The Chair welcomed all to the meeting. It was noted that Dafydd Trystan (DT) has agreed with the Chair and Welsh Government (WG) to take an official leave of absence as a Board member due to a potential conflict of interest whilst working as a special adviser to WG. DT will maintain a link with the Capital Investment sub-group but not as a Board member. Apologies had been received from Martin Veale and Graham Williams. No staff observers were present due to the half term school holidays. Mentees on the Step to non-Exec scheme have concluded their programme.

2.   Declaration of interests (if new)

Board members updated their declarations of interest as follows: -

Tanni Grey-Thompson has now resigned from board of Yorkshire Cricket – will be managing exit next week. Select hearing on Tuesday.

Rhian Gibson – Director of Pontypridd Rugby Club – now resigned from position

Ian Bancroft – CEO Wrexham CBC, reiterated in relation to any discussion on Sport Partnerships

3.   Minutes of the last meetings

3.1        Minutes, Action Log, Decision Trackers & Matters Arising

A correction to the minutes of the last meeting dated 24 November 2023 was noted.  Rhian Gibson had also been welcomed to Sport Wales but omitted from the notes. With this correction, the minutes of the previous meeting were approved as a true and accurate record. The only matter arising was that the Health and Safety and Safeguarding Champions had been appointed. All actions completed.

3.2       Notes of the Extraordinary Meeting 6 December 2023

Agreed as true record at the 8 January 2024 meeting.

3.3        Notes of the Extraordinary Meeting 8 January 2024

It was confirmed that a formal response had been received from the Welsh Government finance team in respect of the proposed approach to pre-paying some partners for their 2024-25 allocation.   The finance team had confirmed that they were satisfied with the proposed approach.  Thanks were afforded to NW for his advice and support. Agreed as a true record.

4.   Chair & Executive Report – SW(24)01

The CEO added the following to the report:

• WRU has made good progress. The Sport Wales role was now focussed on helping to establish an Oversight Group as per the Rafferty Review recommendations and working with the Executive on the necessary governance improvements identified by the separate BDO report. WRU has been informed that no funding will be provided unless the outstanding conditions are resolved.
• Sports Cabinet (now called the Inter-Ministerial Group for Sport) is meeting in-person on 1 March in Glasgow but, unfortunately, clashes with the TRARIIS conference. The last IMG meeting was a light touch on content and held online.
• Netflix have made a film about the Homeless World Cup which involves the Chair of sportscotland, Mel Young.

5.   Policy & Strategy

5.1        Business Plan 2023-24 update SW(24) 02

This paper updates Board on progress against 2023-2024 Business Plan.

EW thanked the whole team for their assistance in producing the report. It ws acknowledged that the Business Plan had iterated during the year to add in a priority around investments.  Sport Wales had launched the Principles-led investment stream and given the response to this approach, it has now been removed from the risk register.

EW noted the following highlights from the report: -

• The launch of the Energy Saving Grant scheme – funding 58 projects
• The launch of Citbag, an online platform targeted at those who delivers sport to young people
• Marked and encouraging progress with Sports Partnerships
• The development of a partner resource pack on Environmental Sustainability, with initial data indicating good reach of target groups, including access to bilingual content.

It was acknowledged that more limited progress had been made on hybrid working.  This was still an evolving area and Board remained keen for work to continue, incorporating the learning to date.

Board noted the Citbag resource and the potential commercial value that this resource might have.  Board also discussed the inclusive sport system priority, noting that it was less specific than other priorities, and it would be helpful to think through how to determine whether the work was delivering the intended outcomes.

5.2        Partner Accountability Q3  SW(24) 03

The paper provided a quarter three (October–December) update on the progress and learning of partners against the accountability framework.

The main points of note were that this was the third paper for Board of this nature and credit is due to JN and her team for the evident progress.  This was the start of a better collaboration with and between partners and the report is now shared across them for further learning and collaborative working. Given the natural pessimism about budgets, this also paints an alternative picture of some positivity amongst partners and the role that storytelling can play in igniting enthusiasm.

5.3        Business Plan 2024-25 SW(24) 04

This paper outlines the proposed Sport Wales Business Plan for 2024-25 for consideration by, and ultimate approval of, Board.

A brief narrative was given on the changes from last year’s plan with the main focus being on the embedding of the objective of an Inclusive Sport System into the other Business Plan priorities rather than being a separate item of its own. The second key change was to iterate the business plan from away from Equality, Diversity and Inclusion (‘EDI’) towards an Inclusive Organisational Culture.  The intention of this change was not to diminish the importance of EDI but instead to recognise that an inclusive organisational culture created an environment where EDI thrives.

The Business Plan also contained details of several projects of significance, namely the Sport Wales National Centre capital project, the National Lottery 30th Birthday, External relations and improved sector resilience.

Board discussed the Business Plan noting the following: -

• The move towards an Inclusive Organisational Culture was felt to be a positive change and universally welcomed.
• External relations was highlighted as a necessary addition to the projects of significance.
• It was noted that the ‘at a glance’ section of the Business Plan summarised ‘what’ Sport Wales was planning but could instead, be reframed to summarise the intended impact of the work.
• The Business Plan would benefit from greater clarity around why the specific projects of significance had been selected.

Board approved the Business Plan.

5.4        Budget 2024-25 SW(24) 05

This paper outlined the proposed budget for 2024-25 based on the draft Welsh Government settlement and Business Plan above. The paper referenced the budget setting process together with the key assumptions and choices that the Executive and Leadership teams considered in developing the budget.

EW noted the following: -

• The context is well known with a 10.5% reduction in WG funding.
• The impact of the budget reduction had been mitigated as far as possible by making a prepayment to some partners for their 2024-25 allocation.  A reduction of £800k had been applied to partner budgets.
• Budget holders had adopted a prudent approach to discretionary spend areas.
• The net impact of the budget was a deficit of £504k.  EW outlined that there were potential mitigations, including the likelihood that some partner organisations might not meet the Capability Framework requirements (and would receive less funding as a result).  Sport Wales also continued to lobby for a letter of support / change to the Framework Agreement, which would trigger a review of the status of Sport Wales within the Local Government Pension Fund.  This could result in a significant financial saving.
• An impact assessment had been undertaken and attached as an appendix to the report.

Board noted the paper and emphasised the need to consider budget implications in the medium term, accepting that there wasn’t a Welsh Government indicative budget beyond 2024-25.

Board approved the 2024-25 Exchequer and National Lottery budgets.

5.5        Partner Investments SW(24) 06

This paper recommended the amount of Sport Wales investment into partners for 2024-25.

The report presents the funding outcomes for next 12 months based on the indicative WG budget, as we enter the final year of transition to the new investment approach. It was noted that three partners have not currently met necessary governance (capability) criteria for funding. More generally, there is an imminent meeting with partners to look at effectiveness, efficiencies, shared services and income generation – we will be looking to help them with support for this sector resilience piece.

Board approved the recommendations

5.6        Strategic Equality Plan SW(24) 07

EW presented the draft Strategic Equality Plan for the period 2024-28, noting the following:-

• Sport Wales has a statutory requirement to publish its strategic equality plan for 2024-28 by 1 April 2024.
• A critical friend approach had been used to gain input and insight from a range of individuals and organisations from across all protected characteristics.  This had been a critical part of developing the Plan and feedback had been incorporated into the document.
• There were four draft objectives centred around organisational culture, pay gaps, socially responsible procurement and continuous improvement.
• The Plan had been discussed at the Equality, Diversity and Inclusion Committee with updates made to the document based on feedback.
• Subject to Board approval, the next step would be to translate and publish the Plan.

Board discussed the Strategic Equality Plan and noted that it felt appropriately ambitious and aspirational (e.g. eliminating rather than reducing pay gaps).  

Board approved the Strategic Equality Plan 2024-2028.

6.   Finance & Risk

6.1        Finance 2023-24 Month 9 Report SW(24) 08

This report provides a summary of the financial position for Sport Wales up to 31 December 2023. A likely underspend of £1.5m had been identified.  This was comprised of three key elements: -

• Departmental underspends of £600k identified via quarterly budget monitoring meetings with budget holders
• Non-payment of funding to a partner that was not currently meeting the Capability Framework
• Non-payment of cost-of-living support to Sport Partnerships (as they had not all been established).

It was noted that Board had considered how this sum could be utilised to mitigate the budget reduction for 2024-25 and it had been agreed that prepayments would be made to some specific partners.  This would also ensure that Sport Wales met the requirement to stay within the 2% carry forward cash balance at 31 March 2024.

Lottery expenditure will total £16.8m against a budget of £17.1m.  It was noted that there had been an unprecedented demand for the Be Active Wales Fund (BAWF).

6.2        Corporate Governance Manual SW(24) 09

EW outlined that the Corporate Governance Manual was reviewed annually.  A small number of changes were proposed and highlighted in red text.  The changes included a comprehensive introduction outlining the role of Sport Wales, adjustments to some of the language to ensure inclusivity and the correction of some minor typos.  Following feedback from members of the Audit and Risk Assurance Committee, further detail had been incorporated into the Manual around the National Lottery.

Board approved the Corporate Governance Manual.

6.3        Terms of Reference SW(24) 10

EW outlined that the terms of reference for each Committee should be reviewed annually, as outlined in the Corporate Governance Manual and in accordance with good practice.

EW summarised as follows: -

• ARAC – no changes proposed.
• EDI Committee – comprehensive review with consideration of internal and sector progress.  Standing agenda items included.  Consideration given to co-opting diverse voices onto the group.
• Remuneration Committee – no substantial changes proposed.
• Critical Governance Committee – this was established during Covid and it was considered appropriate to formalise the ToR for this group.

Board approved the Terms of Reference.

6.4        Risk Appetite and Corporate Risk Register SW(24) 11

EW presented the proposed risk appetite, noting that following review, no changes were proposed.  It was noted that the Executive Team had considered risk in the context of a reduced funding envelope and felt that the appetite was appropriately balanced between seeking risk to drive improved outcomes and innovation and minimal risk for areas of compliance and regulation.  It was also noted that there were increasing capacity constraints within some teams, particularly those focused on aspects of partner governance and compliance.  Priority areas of work relating to sector resilience might lead to new and innovative solutions, which may warrant a review of the risk appetite for reputation in the future.

Three updates to the Corporate Risk Register were noted: -

• A new risk relating to political uncertainty due to imminent elections (low risk)
• A new risk relating to financial sustainability of some partners (low risk)
• The reputation risk relating to the principles driven investment approach had been archived as the Communication Plan had fully mitigated this risk.

Board discussed the risk appetite and Corporate Risk Register, noting the following: -

• Acknowledged that some risks could not be mitigated, and it was more about having a relevant and suitable response plan
• It was noted that the compliance/regulation risk appetite identified that Sport Wales would ‘avoid’ decisions that may result in heightened regulatory challenge.  This terminology could be revisited.

Board approved the risk appetite and noted the corporate risk register.

6.5        Board Governance – update

The Chair noted that the original timetable for Board member recruitment for this and next year is currently under discussion with WG but Board appraisals will still need to be conducted.

The Vice Chair thanked the Board members for returning their skills matrix, noting that the aim is to present the outcome of this review at the next board meeting. The skills matrix would also contribute to the appraisal, inform personal development for members and aid succession planning.

Board appraisals were previously a meeting with the vice-chair but the aim is to update the process with an additional element of self-assessment (narrative and scoring) based on good practice.

The Vice Chair also noted that a governance review was a key component of ensuring that effective mechanisms were in place.  The contract with Deloitte had now concluded and new internal auditors (RSM) had been appointed following a tender process. They would undertake this review.

7.   Board Groups & Standing Committee reports

7.1        Summary of Subgroups SW(24) 12

This paper summarised the discussions and decisions of the Board’s sub-group meetings since the previous Board meeting. Any substantial updates or issues requiring decisions will be presented within separate papers. It is a paper for information.

8.   Any Other Business

• Sport Wales is seeking to achieve Level 2 of the Safeguarding standards. Board training is one of the requirements, therefore it is suggested that a session is arranged for the evening before the next Board meeting – there is an 80% attendance threshold to be achieved for accreditation.
• Board congratulated RB on the success of the inaugural WEDSA awards in December. Chair agreed that it was a great networking opportunity as well as a celebration of achievements and that RB and her voluntary committee had done a great deal of work towards making it a success.
• September Board meeting to be held in West Wales - Parc Y Scarlets had confirmed availability, however, we may look at alternatives in Swansea due to easier public transport links (TBC).

9.   Date of next meetings: 17 May 2024

12 July, 20 September (West Wales), 22 November 2024

The minutes were approved by the Board at its meeting on 17 May 2024.