Transparency data

Board minutes: 26 September 2023

Published 13 December 2023

Minutes of the 50th Board Meeting

Held at 100 Parliament Street, SW1 26 September 2023 10:00-13:15

Board members present:	Others present:
Hannah Nixon (Chair)	Malcolm Botting (for part)
Roy Barker	Alan Brennan
Peter Freeman	Colin Hill
Alastair Groom	Ben Johnson (for part)
Hugh Kelly	Colin Sharples
John Russell	Peter Regan (for part)
Joanne Watts	Susan Richardson
Claire Williams	Siobhan O’Donoghue (minutes)
	Tara Usher (MOD Representative) (for part)

Welcome, apologies, announcements, and declarations of interest

The Chair welcomed Board members and attendees to the meeting, in particular John Russell, attending his first Board as Chief Executive and Siobhan O’Donoghue, Senior Governance Manager.

There were no apologies for absence.

In a change to the published agenda, Mark Preston, Director, Directorate of Sponsorship and Organisational Policy (DSOP) and Charly Wason, Head of the Single Source Advisory Team (SSAT) were unable to attend the meeting.  Alternative arrangements would be made for their attendance.  Action: Secretariat

Declarations of Interest

Tara Usher, MOD representative, declared a new interest.  The appointment did not present any conflicts of interest and was noted for the record.

Minutes of 49th meeting held on 15 June 2023 (SSRO 01-0923) and action tracker (SSRO 02-0923)

The Chair introduced the minutes of the Board held on 15 June 2023 and the action tracker.  Subject to minor clarifications, the minutes were approved as a correct record.  All outstanding actions had been completed.

The Board approved the minutes of the 49th SSRO Board meeting held on 15 June 2023 as a correct record.

Chair’s introduction

The key agenda items for the Board’s particular attention were the draft 2024-27 Corporate Plan and Financial Planning items.  The Baseline Profit Rate methodology was also presented for the Board’s approval.

The Board noted the Chair’s introduction.

Update from MOD

Tara Usher, MOD representative, reported on MOD priorities and key updates, including current MOD messaging around financial constraints and the need for operational efficiencies.

Preparatory work was underway for the SSRO’s Public Bodies Review, which was due in 2024-25.  Key review categories were governance, efficacy and efficiency.

The Board noted the MOD update.

Corporate Performance Report (SSRO 03-0923)

The Board considered the Corporate Performance Report, summarising performance against SSRO’s overall strategic priorities, Corporate Plan objectives and budget.  The report also included a summary of the key corporate risks.  Performance was positive overall with all objectives RAG-rated green or amber; the amber ratings reflecting the challenge set by the Chief Executive in terms of future ambition, rather than a deterioration in performance.

Updates discussed included: the ongoing review of legislation; positive progress with pre-referral activity; SSRO’s progress on skills and training; strategic engagement and communications; and risk.  An in-depth review of corporate risks was planned for early 2024.

Further to the report, the Chief Executive provided his own perspective on the SSRO’s performance and priorities and set out four strategic themes that would be a particular focus in the coming months and for the next Corporate Plan: visibility; accessibility; trust; and relevance.

The Board noted the Corporate Performance Report.

Corporate Plan 2024-27 (SSRO 04-0923)

The Board considered the proposed strategic context and themes for the Corporate Plan 2024-27, the 2024-25 operational plan and associated budget.  Proposals incorporated feedback from the July 2023 Board workshop as well as staff comments, and reflected the Board’s steer for a concise update, building on the existing direction of travel and work programme.  Feedback from stakeholders had also indicated a preference for continuity.

The SSRO was considering what it could do differently, reduce, or stop (mindful of the need to deliver statutory functions).  Efficiencies had been identified and processes were being streamlined to help focus resources on priorities, for example increasing financial delegation limits, reviewing and rationalising formal meetings, and producing more focused material for Board and sub-committees.

The Board noted the corporate planning update and made a small number of suggestions.  The Board would receive a further update at its December 2023 meeting.

The Board commented on and approved the process and timeline for the development of the Corporate Plan 2024-27, the Operational Plan 2024-25 and the SSRO Corporate Budget 2024-25.

Non-Executive Board Member (NEBM) and Chief Executive discussion

The Chair held a closed session with NEBMs and the Chief Executive.

Staff and the MOD representative re-joined the meeting at the conclusion of the discussion.

Chief Executive’s Report (SSRO 07-0923)

The Chief Executive presented his regular report, which summarised recent activities, future priorities, and key issues not covered elsewhere on the agenda.  The report also summarised recent publications and stakeholder engagement, including meetings and site visits to industry and MOD facilities.

It was noted that the 2023-24 pay remit proposals had been submitted for final Ministerial approval.  The Workforce Strategy was due to be considered by the People Committee at its November 2023 meeting, and subsequently by the Board.

The Board considered a small number of amendments to the Corporate Governance Framework, aimed at reducing bureaucracy and delegating decision-making.  The changes were clarification of the Executive Committee’s role; delegated approval to Directors for non-significant budget variations; and an increase to the maximum value of contracts that Directors could award from £10,000 to £30,000.

The Board:

• noted the information in the Chief Executive’s Report; and
• agreed the proposed changes to the Corporate Governance Framework.

SSRO Financial Planning (SSRO 05-0923)

The Board considered the SSRO’s initial position on the draft 2024-25 budget.  The Board was supportive of the ambition to do more, and supportive in principle of seeking a budget to support an additional step change in delivery of the key corporate plan objectives.  The SSRO would need a well-evidenced case and should expect robust challenge from the MOD.

The proposal would be developed for submission to the MOD as the 2024-25 draft financial plan, and more detailed financial modelling would be brought back to the December 2023 Board for consideration.  A summary of current resource allocation against corporate plan objectives would be shared outside of the meeting.  Action: John Russell.

Separately, the paper provided an updated forecast outturn against the 2023-24 budget and sought Board approval on a number of specific in-year matters as detailed in the paper, including the reallocation of accommodation budget savings.

The Board also considered a draft business case seeking additional funding for DefCARS system changes to ensure it remained aligned with amended reporting requirements.  The business case would be submitted to the MOD with the Q3 Grant in Aid submission.

The Board:

• agreed the approach to the 2024-25 budget;
• noted the current 2023-24 forecast outturn;
• approved a number of in-year matters as set out in the paper, including the reallocation of accommodation budget savings; and
• recommend the submission of an in-year business case to the MOD for additional DefCARS funding.

Finance, Payroll and HR Outsourced Services contracts (SSRO 06-0923)

The Board considered proposals for a procurement exercise for the SSRO’s Outsourced Support Services contracts (Finance, HR, and Payroll).  The Board noted the anticipated benefits and supported the procurement of an integrated service.  Noting the significant contract value, the Board requested that the procurement exercise seek the widest possible range of tenders to ensure the greatest possible value for money.  Shared service options should also be considered.

The Board:

• approved the procurement for outsourced support services;
• approved the permanent reallocation of accommodation savings to outsourced services;
• delegated authority to the Chief Executive Officer to approve the award of the contract and thereafter enter into contract on behalf of the SSRO; and
• noted the key stages of the procurement plan.

Profit Review consultation: SSRO response (SSRO 08-0923)

The Head of Pricing and Economics presented the proposed methodology for the 2024-25 baseline profit rate, capital servicing rates, SSRO funding adjustment assessment and government owned contractor rate.  There were no proposed changes to the underlying principles of the methodology from 2023-24.

Findings from Phase 1 of the SSRO’s activities review, which had concluded in August 2023, broadly supported the ongoing suitability of the established methodology.  Feedback had also highlighted some potential areas of methodology incremental change, which would be finalised in Phase 2 of the review following the conclusion of this year’s rates assessment.

The Board approved:

• the baseline profit rate, capital servicing rates, and SSRO funding adjustment methodology to be applied for the 2024-25 rates assessment, including an additional ‘government owned contractor rate’; and
• the publication of the SSRO’s response to the baseline profit rate activities review consultation.

Sub-committee minutes and updates (SSRO 09-0923 to SSRO 11-0923)

The Chairs of sub-committees presented the final minutes, reports and oral updates from recent meetings.

The Board noted:

• the minutes of the 12 July 2023 Regulatory Committee meeting;
• the minutes of the 1 June 2023 and report of the 14 September 2023 Audit Committee meetings;
• the minutes of the 24 July 2023 People Committee meeting; and
• oral updates from other most recent meetings.

Future workplan (SSRO 12-0923), reflections on meeting and any other business

The Board considered the summary of Board and sub-committee meeting business.  Future Board agenda would include a specific slot for a strategic discussion.

Any other business

It was noted that, in line with Cabinet Office guidance, arrangements were being made for an externally facilitated Board Effectiveness Review to take place in 2023-24.

Next Board meeting

The next meeting of the Board would take place on 12 December 2023 at 10:00.