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Forest Services Board minutes of the 18th meeting held on Tuesday 13 December 2022 10am to 12.30pm via MS Teams.

Present

Sir William Worsley (Chair)  
Hilary Allison  
Edward Barker  
Anna Brown  
John Lockhart  
Ross Murray  
Derrick Osgood  
Rebecca Rhodes 
Steph Rhodes 
Richard Stanford  
Sandy Storrie 

Attendees

Samantha Malpass (for item 3.4)  
James Murdoch (for item 4.1)  
Lucy Wyatt and Bianca Ambrose-Oji (for item 4.2)  
Ian Tubby (for item 4.3) 

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Gemma Thomas 

1. Welcome and Apologies 

Sir William Worsley welcomed attendees to the meeting.  He welcomed Ross Murray to his first meeting as a Commissioner. 

The papers by correspondence were noted, without comment.   

Sir William welcomed the proposed visit to the Bristol Office in July 2023.   

He gave the Forest Services (FS) Board an update on recent activities across the Forestry Commission (FC).  Sir William and Richard Stanford had recently had a positive meeting with Forestry Minister Harrison.  The meeting at Whinlatter covered productive forestry, recreation and biodiversity at Whinlatter and then the Minister visited AW Jenkinson’s processing plant. 

The Commissioners met on 27 October to consider the Disputed Case at Wallshield and after careful consideration decided to reject the scheme solely on the potential impact on breeding waders.  The Forestry England Biodiversity plan was launched on Monday 7th November. The biodiversity plan brings together Forestry England’s bold steps to restore nature together for the first time in a singular vision.  Tree planting targets for the Forestry England Woodland partnership had been reprofiled with Defra (from 2360ha to 1120ha). This is more realistic for leasehold acquisition, although it might be possible to achieve more with freehold with the support from the Secretary of State. Proposals would be considered by the Nature for Climate Programme Board in December.  Forest Research was delighted to welcome Countryfile to Alice Holt for their final Plant Britain special. The piece covered a wide range of issues around tree and plant health, including surveillance, diagnosis, research, recent outbreaks, the lab and our operational response. It also tied into wider issues around carbon sequestration and climate change. The programme aired on BBC1 on Sunday 20 November. �

Sir William informed the Board that Richard Stanford would be attending the next FC Quarterly Performance Review with Edward Barker on 24th January. The first Ministerial Performance Review with Minister Harrison would follow this meeting, date tbc.  

The rescheduled Parliamentary Reception would be held in the evening on 28 March.  

2. Minutes of the last meeting and Declarations of Interest 

The minutes of the meeting on 4 October were agreed as a true record.     

All actions were noted as discharged or in train.   

Sir William Worsley enquired whether there were any new Declarations of Interest.    

Hilary Allison noted that she had just been awarded a small contract by Natural England to look at the use of urban green space, but that would only run until March 2023.  Sir William Worsley noted that he had been awarded membership of the Institute of Chartered Foresters.   

3. Key Management and Financial Information  

3.1 Directors� Update  

Anna Brown introduced the FS Director’s Report.   She noted that the FC had received the Secretary of State’s priorities around environmental targets and statutory deadlines for the environmental improvement plan.  An implementation plan is required for the Environment Act, and that will be helpful for FC ±è´Ç±ô¾±³¦¾±±ð²õ.ÌýÌýÌý

The Board discussed the Woodland Carbon Code.  John Lockhart noted his strong concern picked up from across the sector was that the recent changes to the Woodland Carbon Code Calculator would affect carbon funding, particularly for lowland projects.  There was concern about planting project failing additionality tests.  Ross Murray added that he was hearing concerns from forestry investment businesses  about the discount rate.  The Board discussed the government’s Green Book discount rate.  Business cases could be presented to Treasury, but a better argument might be one of natural capital.   Steph Rhodes noted the next iteration of the WCC was coming in May 2023, and that Mark Broadmeadow and team would be looking at these issues and raising them at the various relevant governance forums.     

Steph Rhodes updated the Board tree planting targets.   She noted that the statutory targets coming out of the Nature Recovery Green Paper placed trees and woodlands on a par with other land use priorities, which was very important for the work of FC teams.  There still needed to be some fundamental changes to allow the necessary acceleration in planting, and there was good engagement from the Secretary of State on this.   

3.2 Risk, Issue and Opportunity Register, and FS ¶Ù²¹²õ³ó²ú´Ç²¹°ù»åÌýÌý

Anan Brown updated the Board that the FC Strategic Risk Register was being reviewed, and that would affect the FS Register.   The Board discussed worsening Risk FC3, and it was noted that the conversation with the Ministerial team had taken place after the Register was circulated, and thus would see an improvement.  The Board discussed Issue 113, and Hilary Allison suggested a Board discussion for a future date to look into technology, including FLO and GMS.  This was noted as an Action to be added to the Forward Look.   

The Board discussed targets for Woodland Management.  The improvement in Woodland Management Plan figures was noted.  The Board noted the need to have a discussion at a future meeting on setting targets.   The Board noted the link to the Woodland Carbon Code discussion earlier in the meeting with risk FSR004.  Anna Brown noted the progress being made to regulatory processes, including EIA changes to consent.  Changes were slow in coming, but progress was being made.     

The Board also discussed attrition rates in FS, which had improved from the previous year, and the possible reasons for that reduction.   

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Gemma Thomas to add an agenda item on technology challenges and the supporting infrastructure required (including FLO and GMS) to the Forward Look for a meeting in 2023.   

Gemma Thomas to add an agenda item on targets for woodland management to the Forward Look for a meeting in 2023.   

3.3. Finance Update 

Derrick Osgood introduced his paper.  He noted that when annualising the actuals of £19.937M at AP07, this equated to some £37.71M, some £32.24M lower than the forecast outturn of £69.95M.  He noted that the run rate must improve rapidly through second part of the year, through spend resulting from the planting season/improvements in applicants claims as well as progressing core FS programmes.   He noted the recent GIAA audit which raised a number of issues around alignment in terms of how the finances of both FS core and NCF were brought together.  

Sandy Storrie noted that FS finances were highly second-half weighted, and even given the seasonality inherent in the tree-planting year, should the FS Business Plan have a more balanced spend.   Derrick noted the changes he would like to see to the Business Planning process, and increasing financial awareness in cost centre managers.    The Board discussed the pattern of overplanning and underspending, which was acknowledged, particularly in a time of significant and rapid growth.  Overplanning was therefore likely to settle once a full complement of staff was reached. 

3.4. FS Business Planning: A Review and Looking Ahead  

The Board welcomed Samantha Malpass to the meeting. She noted that 2022-23 had been a year of growth, approaching 450 headcount in FS�. It had also been a year of significant delivery with continuing momentum of woodland creation, woodland management plan service standard improvements, the biggest ever CS Higher Tier year, significant outbreak management including the launch of new EAPC system. FS finished with underspend which was symptomatic of ongoing growth, but sound monitoring and reporting allowed funds to be reallocated�.  Looking ahead, 2023-24 will be another year of growth�.  There is a major ambition to improve prioritisation and counteract the tendency towards optimism bias as part of this and future business planning exercises; business planning will cease being an annual exercise and become a year-round cycle�.  As part of this, reporting to the Board will be improved and streamlined � supported by boosted, dedicated resource. The plan was to use Q4 to do detailed work aligning deliverables with resources for the remainder of the Spending Review period�.   

The expectation was for the FS Board would sign off the FS Business Plan at the March 2023 meeting, with a draft circulated well in advance.   

The Board discussed whether there were other organisations doing Business Planning on a rolling basis that FS could learn from, and queried the causality between an annual cycle and a reduction in optimism bias.   Better access to better in-year monitoring data would provide a clearer and more realistic picture, and with a better link to risk management.   

The Board discussed diversity in the workforce, and raised concerns that this was not being tracked as closely as it should be.  It was noted that this was an issue across the sector as a whole, and the DWO programme was a useful way to increase diversity into forestry as a whole. Sam Malpass noted that this was an output which would be tracked.   

4. Items for Discussion  

4.1 Update: Growing the FC’s Enforcement Capability 

The Board welcomed James Murdoch to the meeting.   He noted the two papers, one on Enforcement Policy, and one on Investigation Barriers and Considerations.   The request was for the Board to endorse and ‘sign off� the draft�FC Enforcement Policy, and to consider the Investigation Barriers and Considerations paper.  James updated the Board on progress since 2020, and outlined the proposed change in process, replacing the work carried out by the Defra Investigation Service (DIS) with in-house FC enforcement investigation capability. James highlighted the hiring into FS that had happened recently to help mitigate obstacles.   

The Board discussed the precautionary principle and the emphasis of this, and its placing within the proportionality issue, in the policy.  The Board then discussed the need for the policy to look to the future with the change in enforcement investigation capability being brought in-house.   

The Board discussed the appeals process, and the timelines for investigations.   

The Board endorsed and signed off the draft Enforcement Policy.   

James then updated the Board on the Enforcement Barriers paper.  The Board discussed Woodland Officer capacity to record information in the way required for this process, and it was noted it would not add to their workload, and ideally make this area of their work easier.   

4.2 An Evidential Look at Woodland Creation  

The Board welcomed Bianca Ambrose-Oji and Lucy Wyatt to the meeting.  Bianca noted the starting question ‘why do landowners plant, or not� and led the Board through the evidence available to answer that.   Lucy Wyatt then noted the ways in which the evidence could be utilised in promotion and engagement work on the ground, and outlined the high-level themes. 

The Board discussed devaluation of land, and the potential of timber shortages in 10-15 years.  The Board then discussed irreversibility, and whether the fact that land, once planted, was designated as forestry in in perpetuity was holding people back.   The Board discussed targeting landowners in efforts to secure more planting, and the difference in viewpoint depending on scale of planting.  Working with the public sector and with landowners could reap easier and bigger rewards, in terms of scale, than planting on agricultural land.   The Board noted that in order to reach the 2050 targets, it would be vital to secure behavioural change so that planting would be a cyclical and repeated activity.   

4.3 Natural Capital: An Update   

The Board welcomed Ian Tubby to the meeting.  Ian noted Natural Capital is a well established concept and something that HM Treasury recommends is included in the development of business cases.  Ian briefly noted the history behind natural capital as a working concept.  Looking ahead to the delivery of the 25YEP, there might need to be a review of regulation around land use change.  Ian noted the possibility of putting together a natural capital based bid for funding in the next Spending Review, building on what the NCF has achieved.  That would require good partnership working.   

The Board discussed natural capital accounting, and non-monetary value.   The Board noted Natural England’s Environmental Benefits of Nature tool, and the high value of forestry within that, and the importance of finding a mechanism to synthesise natural capital with the regulatory framework.   

The Board noted its support of the development of a ‘Green Economy� project to explore  options for a spending review bid aimed at increasing the value of natural capital in England and increasing the contribution forestry makes to economic growth, Net Zero and nature recovery goals. 

5. Any Other Business 

Sir William Worsley thanked the Board members and closed the meeting. 

6. Date of Next Meeting 

The next scheduled Board meeting would be held on 14 and 15 March 2023, and would be in person.