Transparency data

Board minutes: 23 June 2021

Published 25 January 2022

Minutes of the 39th Board Meeting

Meeting held remotely Wednesday 23 June 2021

11:00 to 13:30

Board members present:	Others present
George Jenkins (Chairman)	Andy Brittain (MOD Representative)
Peter Freeman	Colin Hill
Hugh Kelly	Mike Wetherell
David Johnston	Malcolm Botting
Marta Phillips	Jane McGovern (item 5)
Claire Williams
Neil Swift
David Galpin

1. Welcome, apologies, announcements and declarations of interest

1.1. The Chairman welcomed members to the 39th meeting of the SSRO Board.

1.2. The Chairman welcomed Claire Williams and Hugh Kelly to their first meeting as Non-Executive Board Members.

1.3. The Chairman noted that this would be Marta Philips’ last Board meeting after seven years as a Non-Executive Board Member, although she would join the September Board meeting as a guest. She would also attend meetings of the Regulatory Committee and Audit Committee before her term ended on 28 September.

1.4. The Chairman announced that, in view of the situation regarding COVID-19, government guidance on this matter and in accordance with Standing Order 3.10, the Board meeting was being undertaken remotely by telephone for all Board members.

1.5. No declarations of interest were made.

2. Minutes of the 38th meeting of the Board, 27 May 2021, and action tracker

2.1. The Chairman introduced the minutes of the Board meeting held on 27 May 2021. Six actions were recorded and marked as complete.

• Action 101 – the Chairman had shared with Board members a note of his recent meetings with senior stakeholders on 28 May 2021.
• Action 102 - Mike Wetherell had written to DSOP on 1 June 2021, providing the Board’s response to the MOD’s direction on category management.
• Action 103 - A table setting out progress against the Tailored Review recommendations had been included in the Chief Executive’s Report to the Board.
• Action 104 - A meeting regarding Performance and Risk Reviews was being scheduled between Neil Swift and Andy Brittain. Neil Swift was also due to meet with the Chief Executive of the Oil and Pipelines Agency to discuss such reviews.
• Action 105 - The Chairman had approved the minor amendments made to the Review of Legislation recommendations document following the May Board meeting, and it was submitted to the Secretary of State on 14 June 2021. David Galpin agreed to provide an overview of the work and recommendations to the two new Board members, and a meeting would be arranged to discuss this and other items. Action: David Galpin.
• Action 106 - An item on committee membership was included in the Chief Executive’s Report to the Board.

2.2. The minutes of the 38th meeting of the Board were approved as a correct record.

3. Chief Executive’s Report

3.1. Neil Swift, Chief Executive, presented his report to the Board. The report provided an overview of stakeholder engagement, including the Chairman and Chief Executive’s meeting with Boeing UK on 22 June. The Chairman provided an overview of his meeting with the Minister for Defence Procurement on 7 June, which had focused on the Defence and Security Industrial Strategy and the Secretary of State’s review of the legislation.

3.2. Recent SSRO publications had included an update to the Reporting Guidance on 26 May and the Annual Statistics Bulletin on 16 June. The bulletin contained for the first time statistics showing the overall estimated cost and profit at the latest time of agreement and actual/forecast cost and profit for completed contracts.

3.3. An MOD [REDACTED] had taken place on 16 June 2021, and Board members were provided with an update on issues discussed at the meeting. The Secretary of State’s review of legislation would conclude with the publication of a Command Paper in September, and the Board discussed the impact of the review on the SSRO’s work programme and next steps. At its September meeting the Board would consider the SSRO’s approach to the baseline profit rate assessment for 2022 and potential changes to the annual business plan to enable delivery of the SSRO’s corporate plan objectives.

3.4. Following the recent appointment of further Non-Executive Board Members the Chairman had reviewed the membership of all Board sub-committees and appointed the following members:

• Regulatory Committee: Peter Freeman (Chair); Claire Williams; David Johnston; and Marta Phillips (member until 28 September 2021).
• Audit Committee: Marta Phillips (member and Chair until 28 September 2021); Alastair Groom (member and Chair from 1 October 2021); David Johnston; and Hugh Kelly.

3.5. The Chief Executive provided an update on the implementation of recommendations from the Tailored Review of the SSRO. He highlighted recent action on two of the recommendations: the MOD had shared with the SSRO the draft job description for the SSRO Chair position and had taken on board comments provided by the Chairman on the draft; and it had been confirmed that the Corporate Performance Report would be used as evidence to inform the first Performance and Risk Review meeting, which was scheduled for 19 July. The agenda for this meeting would incorporate additional items suggested by the SSRO, and it was agreed that a positive statement should be made about progress against the recommendations in the Tailored Review. Action: Neil Swift.

The Board

• noted the information provided in the report.

4. Future working arrangements

4.1. Mike Wetherell, interim Director of Corporate Resources, introduced a report setting out a framework of principles and supporting guidance to enable SSRO staff and managers to make decisions about where, when and how they work in future. The SSRO intended to adopt a mainly hybrid approach, and the principles incorporated three categories of staff: location specific workers; hybrid workers; and home workers. The principles were business-led and would ensure the SSRO could realise the benefits of smarter working while maintaining security of operations. The Executive Committee would role model the principles and would oversee their implementation, keeping them under review for the period of a year and reporting on progress to the Board.

4.2. The paper also provided a roadmap, which set out a timetable for the return to the office and the roll out of new ways of working. It identified that some HR policies and the SSRO’s travel and subsistence policy would be updated. It also provided an update on ongoing plans to improve space utilisation within Finlaison House.

4.3. In discussion, Board members were supportive of the principles and direction of travel, noting that this was an evolving situation and that the SSRO should remain flexible and mindful of approaches being taken elsewhere. Staff engagement was important, and the Executive Committee would speak openly with all staff, setting clear expectations but allowing managers to have flexibility in how the new approach was implemented.

4.4. Board members made points regarding the importance of consistency of treatment for staff and updating HR policies to reflect the new approach. The priorities set out a broad framework of the circumstances where it was appropriate to come together, for example for line management, project meetings or collaboration. The assistance available to help support managers in setting baselines and boundaries should be considered. It was noted that the needs of the SSRO would always take priority, and that if an approach was not considered successful then it would be revisited.

4.5. Board members considered health and safety issues, noting that home work-spaces should be suitable and have the appropriate facilities necessary to work from home. It was noted that the SSRO currently provided for work-station assessments, the approach to which would be reviewed as new arrangements were implemented. It was also noted that the SSRO’s staff absence days for sickness were low; and it was important to ensure that this indicator (and staff morale more widely) were monitored to assess any impact arising from the new arrangements.

The Board:

• endorsed the approach set out in the cover paper and the principles and guidance at Appendix 1, which would be shared with the staff team and used to guide the SSRO’s future working arrangements; and
• endorsed the roadmap for our return to the office.

5. Annual report and accounts 2020/21 (SSRO 05-0621)

5.1. Mike Wetherell, Interim Director of Corporate Resources, introduced the SSRO’s 2020/21 Annual Report and Accounts to the Board for review and approval, in advance of presentation to the Comptroller and Auditor General on 1 July 2021. No further material changes were expected, and it was expected that following signature by the Comptroller and Auditor General, the Annual Report and Accounts would be printed and laid in Parliament in July.

5.2. The Chair of the Audit Committee, Marta Phillips, confirmed that the Audit Committee had considered the report at its June meeting and was in a position to recommend the Annual Report and Accounts to the Board for approval.

5.3. Mike Wetherell drew the Board’s attention to the updated treatment of an employee benefit for employer’s national insurance contributions, which had been discussed at the Audit Committee. The NAO had been made aware of the issue prior to finalising its opinion and was content with the treatment and disclosure in the accounts.

5.4. A draft of the Annual Report and Accounts had been shared with the Minister for Defence Procurement. Should the Minister provide comments following the Board meeting, the Chief Executive would consider these with the Chairman before signing the accounts.

5.5. Board members provided drafting comments and suggested changes to the text of the Annual Report and Accounts and the presentation of the key performance indicators. It was agreed that all changes made by the Board would be shared with the Minister’s office. Action: Mike Wetherell.

The Board:

• approved the Annual Report and Accounts 2020/21; and
• delegated final approval and signature of the Annual Report and Accounts to the Chief Executive, as Accounting Officer, in consultation with the Chairman. The Chief Executive and Chairman would reflect on any comments provided by the Minister and re-submit the ARA for the Board’s consideration should the Minister’s comments be significant.

6. Corporate Performance Report

6.1. Neil Swift, Chief Executive, introduced the Corporate Performance Report, which provided an update on how the SSRO was delivering against its corporate priorities as set out in the Corporate Plan. All Directors then discussed issues arising within their work areas.

6.2. The Corporate Performance Report would be submitted to the MOD as part of the Performance and Risk Review process, and Board members discussed changes to the report in advance of submission. The Chief Executive would talk separately to Marta Phillips about her comments on the report. Action: Neil Swift.

The Board reviewed and commented on the Corporate Performance Report.

7. Minutes from Regulatory Committee meeting of 17 March 2021 and 20 May 2021

7.1. Peter Freeman presented the minutes from the meetings of the Regulatory Committee on 17 March 2021 and 20 May 2021. The Committee had considered several papers relating to the SSRO’s statutory functions, including the recommendations from the Review of Legislation.

The Board noted the minutes.

8. Minutes from Audit Committee meeting of 15 June 2021

8.1. Marta Philips presented the minutes from the Audit Committee’s meeting on 15 June 2021. Among the papers considered by the Committee were the Annual Report and Accounts and the Head of Internal Audit’s review. The Committee had discussed the Corporate Risk Register and had reviewed the risk appetite for each of the corporate risks.

The Board noted the minutes.

9. Future agendas and any other business

9.1. The Chairman introduced a two-page document showing the business of all Board and sub-committee meetings for the next year.

9.2. The next meeting would take place on 30 September 2021 at 2:00pm.