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"This, the first Wales Audit Office conference, is an important milestone in the development of public administration in Wales. The Welsh Assembly Government first proposed the creation of the Wales Audit Office in 2001. Legislation through Westminster was achieved in 2004 and the new Audit Office has been in place now for over a year.

The creation of the Wales Audit Office is an important illustration of our approach to public service delivery in Wales – reforms that take advantage of us being a relatively small country.

The feature of so many of our reforms has been the stress on integration rather than separation, and often on collaboration rather than competition.

We have integrated many of the quangos of Wales into the Assembly Government because of the advantages in terms of accountability and coordination, and because it will make the best use of the scarce capacities that have now been brought together.

We brought together the various Commissioners of Administration, Ombudsmen, so that there is both greater efficiency and greater clarity for citizens who seek to challenge the administration of public services.

And, the reason that we are here today, we brought together the former functions of the Audit Commission and the National Audit Office in Wales so that there can be a more effective focus for the audit of local government, the National Health service and the Assembly Government.

And today we have the first conference of the new body – attracting people from all parts of the public service, health, local government, private sector, voluntary sector.

I was impressed to learn that the conference was heavily over-subscribed – I wonder how many audit conferences attract such widespread interest. One interpretation might be, Jeremy, that you and your colleagues have revealed a previously unrecognised passion among the people of Wales for the nooks and crannies of public accounting – Wales, Land of Song and Statements about the sources and applications of funds.

I suspect that the real reason for the excellent attendance today is that people across the public service have recognised the real significance of the agenda for change and development in the public services that the Assembly Government is pursuing – and indeed the potential of the new WAO. This is a tribute to the approach itself and to all those who have been involved in bringing the Wales Audit Office into being, not least Jeremy and his staff. It is also a symbol for the future.

Our public services reforms in Wales are not just about institutional change; they are not just about merging together bodies which had previously been separate.

Of even greater significance is our determination to strengthen the connections between the wide range of separate organisations that contribute to public service delivery – the connections between different local authorities; between local health boards and trusts; between the public, voluntary and business sectors; between the Welsh Assembly Government and local delivery organisations.    

We are not primarily about changing institutions and boundaries;  we are about changing the way we work, the way we relate to each other – and primarily the ways in which we relate to the citizens and communities that we seek to service

Our Reform Agenda starts with the objective of putting citizens at the heart of public service delivery: creating forms of delivery and forms of accountability which allow public services to respond to the different needs of different individuals and communities whilst at the same time responding to the genuine demand for consistent levels of service quality.

This is the objective which we set out in our strategy for Making the Connections.

I am pleased to note that as the Wales Audit Office lays out its plans for the next three years it takes ‘Making the Connections’ as its starting point. It summarises our approach as an agenda which seeks to coordinate and promote service improvement, putting the citizen at the centre, along with equality and social justice - and working together.

The challenges faced by public services in Wales are well-rehearsed:

•           rising public expectations,

•           the major demographic shift towards older people,

•           the complex nature of the social, environmental and economic issues we face,

•           the impact of ICT, 

•           the pressure on resources.

There’s no question that we face a set of challenges and opportunities for the public service which are perhaps greater than for many years.

There have been real gains in service improvement in recent years to match the significant investment of new money.

We can be proud of the improvements:

•           in waiting times, 

•           in the number of older people helped to live at home,

•           in public transport,

•           in schools and in local services generally.

The picture today is very different from when the Assembly came into being and we must not forget how far we have travelled.

Recently the Wales Audit Office published its Annual Report on Improvement in Local Government Services. It reported an overall record of improvement in recent years but noted that the improvements were not being achieved consistently across all local authorities and not across all local services. Sometimes improvements in any one year were not being sustained in the following years.

I conclude from the many reports such as this that whilst we can take pride in the improvements that have taken place, everyone must commit to even stronger improvement for the future - and recognise the need to learn from each other’s experience.  

When I began to talk, back in March 2003, about the concept of an increasingly integrated Welsh public service, I was voicing a recognition that to deliver the outcomes we all want, a healthier, better educated, prosperous and sustainable Wales, our public bodies have to become much more joined up in the way they plan and deliver services. I said we needed a public service, sharing common goals and working across organisational boundaries to create greater dynamism, effectiveness and efficiency.

This places a premium on effective collaboration at all levels. For example, we must enable professionals employed in our NHS and Local Education Authorities to work together easily so as to improve provision for children and young people with additional needs. Then again, we must bring together the skills of our police, voluntary sector and local authorities to support local people in creating safer communities.    

This has to be collaboration with a purpose. I am not a fan of collaboration or partnership at the level of easy rhetoric. We all know that productive collaboration takes time and hard graft – but try getting good results for citizens without it and disappointment will follow. The biggest risk is becoming sucked in to an endless cycle of meetings and discussion which takes on a life of its own and does not produce any results.

It is not enough for organisations to just share some high level aims and organise partnership gatherings to compare different ways of working. To improve services we need to develop the means of sharing responsibility and sharing resources. Public Services Management Wales will drive to build the necessary leadership and delivery capacity – but this is not a comfort zone. It is about radical innovation in the ways in which services are delivered – so that we establish delivery systems jointly owned by several organisations wherever this leads to gains in efficiency or service quality.  It’s about getting results.  

Working together is about clear, tangible benefits. Certainly collaboration is not a soft option, it is one of the most demanding and in some ways daunting routes to public service improvement – but it is the way forward for Wales.    

I think most public service leaders understand this very well. There has been, I think, a remarkable development of common purpose among public services leaders following Making the Connections.

We are seeing some notable developments. For example, through the WLGA there is the emergence of the new regional partnerships and a chance to tackle some of the really difficult delivery issues, such as waste management, children’s services and support services for schools.

Helped by the Value Wales initiative, which applies across the whole public sector,  we are beginning to see much more collaborative procurement across most sectors. Then there are advances in joint commissioning of services in social care and the NHS, and work on shared transaction centres. Clinical networks, networks across schools, colleges and universities – all this action on  joint working is moving on significantly. We can deliver, but we have to keep the pressure up.  

We need to connect the changes in service delivery to the primary aim of placing the citizen at the heart of the way services are planned and delivered. There are many excellent examples of good practice but the research we are doing is confirming that people in Wales want better information about public services, more responsiveness when they are in contact with services, and more effective forms of consultation.

People in need of public services often require a seamless and integrated response from a range of service providers. But all the evidence suggests that it is the hard to reach and vulnerable who struggle most to negotiate their way round the institutional boundaries that still too often dominate public service delivery. This is one of the issues with which the Beecham Review is grappling.  

Probably in July, Sir Jeremy Beecham and his team will be reporting on their Review of Local Service Delivery. We commissioned the review as part of the action plan for Making the Connections, working closely with the WLGA.

Just to remind you, we asked Sir Jeremy to help us improve delivery arrangements, their effectiveness and efficiency. Our view has been that we should concentrate on making existing structures work more effectively and efficiently rather than on comprehensive reorganisations. This is a view which the Beecham Review supports.  

I do not yet know the detail of the recommendations Sir Jeremy will be making but he has indicated his view that Making the Connections represents the right direction of travel. I think, though, that there will be plenty on which to chew. Sir Jeremy has signalled publicly his concerns about the complexity of governance in Wales, the pressures on organisational capacity, the clarity and impact of performance management arrangements and silo-based cultures.

Sir Jeremy’s diagnosis is that the scope for improvement lies as much within the centre of Welsh Government as it does within local organisations.

The Beecham Report will be a very substantial piece of work which will provide the basis for long-term development. Indeed, that recognition provides part of the rationale for establishing the new Department for Public Services and Performance led by Richard Davies within the Assembly Government itself.

We shall certainly be setting out our response quickly so that the public service knows our intended direction. It is clear, though that the Wales Audit Office will have an important part to play in helping the public service respond to the new challenges.

Many of the innovations for improved service delivery will be based on new forms of organisation which operate on a geography which is larger than the local authority and smaller than the whole of Wales – so called ‘regions’.

We need to be wary of creating regional tiers of delivery without putting in place appropriate forms of accountability; the effect would be to marginalise the citizen and this would the opposite of our intention. The answer to this problem will be to ensure that the new arrangements have a proper accountability back to the locality and to the Assembly Government itself.

Jeremy Beecham, his team and all of us in this Conference to be very clear in mapping out these new forms of accountability

I want to congratulate the Auditor General for producing the strategy being launched today and for seeing the work of the Wales Audit Office as complementing public services policies and strategies while maintaining its integrity and independence. I am delighted that it gives prominence to Making the Connections.  

The Wales Audit Office has the potential to become a real force for change and improvement and it is in all our interests that it succeeds in its aim of adding value to our public services.

I support the key aims that the Wales Audit Office has laid out for itself:

•           Identifying and promoting good practice,

•           bringing rigour to joint working,

•           pursuing a whole systems approach to improvement,

•           working closely with other inspectors and regulators.

The point is often well made that the public sector in Wales can only work in a joined-up way if the regulators are also joined-up. The Wales Audit Office works across service boundaries and will play its part in helping to align the regulation of public services with the objective of joined-up service delivery. 

Of course, the stewardship role of the Wales Audit Office remains important.  We do not always do things right in the public service; and where there are serious shortcomings the proper accountability disciplines must apply.

But public officials mustn’t be propelled into a safe passiveness for fear that falling short of absolute perfection in administrative standards will always and inevitably attract criticism. Public service improvement demands courage, creativity, and commitment.

The audit process can and should adapt to support those important attributes – to support a mutual willingness to make space for learning rather than blaming. It is essential that the audit process supports the capacity for service improvement.

There is plenty of scope to establish new conventions, new ways of doing business, and a new culture in the relationship between public services and the WAO, where its work bears on helping achieve value for money and service improvement.

It is all dependent on a culture of openness, honesty, mutual respect and robust debate within the framework of shared purpose.

Our public service reforms need to be very deliberate in establishing open and transparent forms of challenge in the system – challenge which is rooted in the needs and expectations of citizens. But the challenge must be motivating and not debilitating – it must encourage risk and innovation as well as ensuring minimum standards of delivery. The Wales Audit Office has a key role in achieving this balance.      

I first met Jeremy Colman just after he had taken up his new role at the Wales Audit Office. Quite rightly Jeremy stressed, as the new strategy document stresses, that an effective auditor must be truly independent of government and all the bodies that are the subject of audit. But Jeremy went on to make the very important point that whilst the WAO would be independent it also sought to be engaged – to be a part of the community of organisations that shared the aim of achieving public service improvement.

I am pleased that Jeremy’s sense of engagement can be found within the strategy that the WAO has put before us today.

The Welsh Assembly Government, the Welsh Assembly in its scrutiny role, the Welsh Health Service, Welsh local authorities all share the aim set out by the Wales Audit Office that we should “promote improvement so that people in Wales benefit from accountable, well managed public services that offer the best possible value for money”.

As this Conference goes forward, and as the discussion extends beyond today, I think it is crucial that we find the means of retaining the independence of the Audit Office whilst at the same time developing a productive engagement between auditors, delivery organisations, central and local government.

An engagement which recognises the contribution that we all must make to service improvement.

An engagement which allows us all to share information and transfer good practice.

This shared purpose is reflected in the title of today’s conference, ‘One public sector for Wales’. This in itself is a very important message and I am heartened that it so well reflects the aspiration we had when we started out on this journey 5 years ago. The WAO strategy is rightly demanding. Nevertheless, this is an important milestone along a continuing journey for all of us. I wish Jeremy and his team very well with their strategy and hope the rest of today goes well."