Corporate report

Minutes: Forest Services board meeting 1 March 2024

Published 11 July 2024

Forest Services (FS) Board minutes of the 19th meeting held Friday 1 March 2024, 10:00 – 12:30 via MS Teams.

Present

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

Presenters

Bob Richards (for Derrick Osgood) (item 3.3)
Sam Malpass (item 3.4)
Joe Watts (item 4.1)
Ian Tubby (items 4.2 and 4.3)

Apologies

Derrick Osgood

Minutes

Gemma Thomas

1. Welcome and Apologies

Sir William Worsley welcomed attendees to the meeting.    

Sir William shared some updates with the Board. At the Confederation of Forest Industries (Confor) Policy Conference in December Richard had spoken on a panel discussion on timber security and increasing sector confidence. He used the opportunity to talk about areas in England where there is the greatest opportunity for woodland creation. Richard and Sir William remotely attended the Oxford Farming Conference on 4 January where Secretary of State (SoS), Steve Barclay, announced increased funding for various land use changes as part of the Agricultural Transition Plan into Environmental Land Management (ELM). Sir William spoke at the ‘Our Shared Ambition for Water’ joint Environment Agency (EA)/ Forestry Commission (FC)/Natural England (NE) conference in Wolverhampton in January, which followed the virtual conference held in November last year and is part of an initiative to improve communication between the three major Department for Environment, Food and Rural Affairs (Defra) arms-length bodies (ALBs). In January, Richard and Anna visited the University of Cumbria Ambleside campus to meet with the current cohort of first-year apprenticeship students, as well as course leaders and the University Vice Chancellor. In October, Sir William was part of a planting of critically endangered Wollemi pine trees (which were thought to have been extinct for 1000 years) at Forestry England’s Bedgebury National Pinetum. This was the first stage of an international conservation effort to establish a flourishing population of these rare trees across the world.   

At the time of the last FS Board meeting it had been announced that Robbie Moore was the Forestry Minister, but the post was subsequently filled by Rebecca Pow. On 23 November Forest Research (FR) staff at Alice Holt, alongside Richard and James Pendlebury, hosted a successful visit by Minister Pow where she was introduced to the broader FC family and specific work FR is doing on the Nature for Climate Fund (NCF) programme and tree health. The next Ministerial Delivery Meeting with Minister Pow was scheduled for 13 March.  

On 4 and 5 March Richard and Anna would be carrying out site visits in Berkshire including hosting a Forestry Commission Pie in a pub evening with local landowners.  

Richard and William would be attending the Confor Dinner and Awards in Edinburgh on the evening of 12 March.  

The Board discussed the publication of the deer and squirrel strategy, which had been delayed again after further information was sought on the subject of venison larders at the request of the SoS. Edward Barker noted he hoped it could be published very soon.

2. Minutes of the last meeting and Declarations of Interest

The following corrections were given to the minutes of the Board meeting on 14 November 2023:   

• paragraph 3.3 - 760,000 was actually a projected overspend rather than underspend, and the final line should read ‘controlled total’

• Robbie Moore MP does not have the title ‘Right Honourable’ 

• there were two typing errors on page 2: ‘ Silkwood’ not ‘Silk Wood’ and ‘Northern’ Research Station not ‘Norther’  

John Lockhart noted that he had become a member of the external steering group of Project Speed. He had given them some case study information; they are looking at how forestry could deliver nature-based solutions, how that might plug into the planning and development space, and where there will be opportunities to accelerate woodland creation. He offered to update the Board at a future meeting. 

There were no conflicts of interest.

Actions:

• Gemma Thomas to correct the Minutes of 14 November 2023

• Gemma Thomas to liaise with John Lockhart to get an update on Project Speed to a future Board meeting

3. Key Management and Financial Information

3.1 Directors’ Update

Anna Brown introduced the FS Director’s Report. Three major developments had occurred in that week and some movement on a forth:   

• changes to removal of Ministerial Directions had been launched, including reducing the time on the public register down from 28 days to 21

• Woodland Creation Fast Track (formerly Presumption to Plant) had been launched.  If an application was United Kingdom Forestry Standard (UKFS) compliant, sits within a low sensitivity area and is fully completed, and no additional constraints identified, it would be turned around in 12 weeks. The aim was for 80% of applications being turned round in 12 weeks in the first year, increasing to 90% in the second year   

• the England Woodland Creation Offer (EWCO) Grant Management System Applications module had been launched which would make processing faster and more efficient  

• some movement had been made around the Farming and Countryside Programme (FCP) payment rates. At the Oxford Farming Conference in January, it was announced there was going to be an uplift in various rates of other land uses, with scrub, agroforestry and wood pasture all significantly outcompeting the current EWCO rates. Agreement had been reached to increase EWCO rates for forestry with greater incentivisation on land that was not best and most versatile for agriculture  

The Board praised the recent process improvements. Edward Barker noted these recent successes would act as encouragement to the other Defra ALBs. He acknowledged the payment rate issue had been very challenging, but it was now in a reasonable place.  Anna Brown noted that any announcement was subject to Treasury/World Trade Organisation sign-off, and central government departments were working on that. Behind the scenes, the guidance was being developed to support the announcement.    

The Board discussed the rise in felling complaints, and possible risks of future judicial reviews. They discussed the pressures caused by increased development, especially in the South East.    

The Board discussed low sensitivity mapping, and at times challenging working relationships with county archaeologists. Anna Brown noted the national project to digitise archaeological data which would help although funding was limited.   

The Board discussed preparations for the Spending Review. Edward Barker noted that there had not been a huge focus on Spending Review preparation in core Defra yet.     

The Board asked about the South East Area entry in the Director’s Report, noting the mention of Deer Officer and Ecologists leaving the FC. Anna Brown noted a Deer Officer had retired, and recruitment issues due to future funding constraints, but in the longer-term it was hoped each Area would have a Deer Officer – essential given the upcoming Deer strategy. Ecologists retention remained challenging as private companies often pay more than the civil service.   

John Lockhart noted recent conversations at the Planting on Private Land Project Board. He enquired about the requirement within the Woodland Creation Fast Track for Woodland Officers to have access to botanical information available. He was aware that work was underway to provide a sufficiently high level of botanical information, but asked whether that could accelerated, so as not to slow down the processing of applications. Anna Brown noted that the botanical information had been supplied under licence from NE and appropriate training would be rolled out to Woodland Officers.  

The Board had a discussion about permanency in relation to agroforestry, community forests, trees outside woodlands etc. and limits of Commissioners’ powers. The Board went on to discuss owners opting out of woodland creation schemes in favour of other land uses with higher grants. The Board discussed productive forestry, and the importance of working with the Countryside Landowners Association and National Farmers Union. In highlighting recent conversations on the issue of productive forestry, the Board praised the calibre of recent additions to the Forestry and Woodland Advisory Committees.

3.2 Risk, Issue and Opportunity Register, and FS Dashboard

Anna Brown updated the Board on the ongoing work to the FS Risk, Issue and Opportunity Register. She noted her concern around financial liabilities, and around FCP transition and Higher Tier timings. Edward Barker noted that David Hill and Sally Randall would be looking at this issue later in March. Also, Defra were looking at ELM governance.  He noted FS should continue to flag any associated risk, but the solution lay with Defra. 

Sandy Storrie noted: 

• FCR13 felt premature to him, as the Board had not yet taken a view on the Business Plan, and because preparation for the Spending Review was still in the early stages 

• the mitigated and target scoring of FCR12 was higher than the initial risk 

• FCR11, 12 and 13 were queried as FC or FS risks (the nomenclature suggested they were FC risks) 

The Board discussed the recruitment restrictions and the increase in fixed term opposed to permanent contracts, and the impacts on staff wellbeing, morale and delivery. Edward Barker commented that many Defra ALBs were carrying risk on this issue, not just the FC. Richard Stanford pointed out that the FC had over 400 staff funded by the NCF which made the FC’s situation different. He talked about the challenging circumstances ahead.   

Moving on to the Dashboards, Anna Brown noted that at the Board’s request, the spilt between broadleaf and conifer had been added.   

The Board discussed planting targets. Steph Rhodes noted that EWCO was doing very well, and it was now possible to report 1500 of the 16140 hectares the FC was committed. The joint working with the Community Forests from last May to share and monitor the pipeline of regulatory applications at the national level had made a difference. Richard Stanford noted the hard work from Steph and delivery colleagues, and noted it was important to be cautious about increases in future ELM rates to minimise future disparities.   

The Board discussed the end of cross compliance and noted that whilst the Forestry Commission no longer sent details of breaches of forestry legislation to the Rural Payments Agency (RPA), it was important to ensure that those who breached forestry regulations were not then ‘rewarded’ by receiving publicly funded environmental grants. The Board noted the need to uphold the principle of not allowing any breaches of forestry regulations to go unnoticed within the wider Land Management sector.   

Ross Murray noted the figures regarding planting of woodland trees in England, and the aim to increase to a UK target of 30,000 hectares. He asked whether it would be possible to express the actuals against a notional English target, to see it in percentage terms.   

Actions:

• Gemma Thomas and Anna Brown to look at FCR11, 12 and 13  

• Gemma Thomas to speak with David Cross about the potential to update the dashboard to show progress against the England annual target

3.3 Finance Update

The Board welcomed Bob Richards to the meeting. Bob noted that since the last Board, the position had improved. The forecast had gone down by just over £1m on capital, and just under £1m on resource. There was now a forecast underspend of £340k, an overspend on resource of around £400k, and on capital an underspend of around £300k. In terms of funding streams, core continued to be an ongoing concern. The Board discussed this issue, and Edward Barker noted he would discuss this offline in more detail with Bob and Anna. Anna noted that Bob had dramatically improved the clarity and visibility of the financial picture in FS, and thanked him for his hard work.

3.4 Board Approval of FS Business Plan 2024-25

The Board welcomed Sam Malpass to the meeting. Sam noted this was the most robust and detailed business plan FS had produced. Sam outlined the planning assumptions, and requested not to have to return to the board level should the over-planning increase to ca. £1m. The reason for the request was that, as with every year, FS did not know if it would receive all anticipated funding. If this occurred the first course of action would be to look to add to the moderate over-planning, before implementing any cuts. 

• decision: is the Board content with our planning assumptions and the avoidance of any material over-planning, in contrast to previous years?   

The Board was content.   

• decision: is the Board content to continue generating further liabilities during financial 24-25 by not stopping high-profile (but unsecured) multi-year activities including EWCO and the Level 6 Apprenticeship programme? Would the Board like to provide a steer on new risk FCR13? 

The Board was keen not to stop the Apprenticeships programme.   

Sandy Storrie noted that FS had overestimated its ability to spend money. In 2022-23 FS overprogrammed the Resource Departmental Expenditure Limit (RDEL) by nearly 10% and still underspent by around 3%. 2023-24 FS overprogrammed RDEL by 5.3% and will still underspend by an unknown figure, but at least 1%. He felt more risk could therefore be taken, and refund some of the high-impact savings measures. Anna Brown asked the Board to consider how many future years’ liabilities did FS want to create? Bob noted that underspend had occurred with a recruitment process that meant roles filled up slowly, and FS was in a different position now.   

The Board was content.   

• decision: around 60% of our posts are covered by non-core funding with NCF making up the bulk of this (~40%). Furthermore, our core budget hasn’t increased in over a decade. Given the liabilities this creates for financial year 25-26, are the Board content that we explore the possibilities of Exit packages now in preparation for an unsuccessful spending review settlement? 

The Board asked what ‘explore’ meant, and Sam noted that the initial plan was to work with Cost Centre managers to come up with a minus 10% and a minus 20% scenario which was linked to the overall scenarios on RDEL that FS was being asked to consider through the Spending Review.   

The Board was content.   

• decision: is the Board content with our plans for managing risks arising from our business planning decisions (see FS Risk and Opportunity Register)? 

The Board was content.  

• does the Board approve our draft Business Plan for financial year 2024-25? 

The Board noted the tone could be slightly more positive. The Board noted the number of objectives relating to being an outstanding organisation, and asked whether the Business Plan was therefore too inward-looking. Richard Stanford pointed out that a Business Plan was an internal document, and Steph Rhodes updated the Board on the new initiatives around ‘operational excellence’ which would look at improving deliver for staff and customers, and where those converged and where they might not. It would not be a project in its own right at this stage, but would focus on brigading existing initiatives.   

The Board gave its approval.   

The Board thanked Sam and colleagues for their hard work.

4. Items for Discussion

4.1 Farming and Countryside Programme Update

The Board welcomed Joe Watts to the meeting. He noted this was an update for the Board on Countryside Stewardship, woodland management for the transition to ELM from NCF, and an update on the woodland creation payment rates with a look ahead to the Spending Review. Announcements were made at the beginning of the year regarding the changes to woodland management within Countryside Stewardship, including a new agroforestry offer, and that the support structure would now be much more modular. Joe drew the Board’s attention to the diagram in Annex 1 showing how the various options and supplements could stack upon each other, giving increased flexibility to the woodland owner, and significantly increasing the financial offer. 

He noted concerns around the delivery and opening of the 2024 Higher Tier offer, with Sustainable Farming Initiative opening possibly in July, and Higher Tier opening possibly as late as the end of year. The concerns around that were both for the communication of those timelines, and also ensuring both staff and the sector would know the content of the launches and would therefore be able to plan appropriately.   

He updated the Board about the transition of EWCO into ELM, and discussions with Defra and the FC Farming and Countryside Programme. The current working assumptions were that the Tree Health Pilot would transfer by December 2025, and then EWCO and the Woodland Creation Planning Grant would transfer by April 2026. That was later than published. Decisions remained in terms of what Forest Services’ role would be in relation to EWCO, with the working assumption being that FS would continue to administer, manage and advise both on EWCO and the Woodland Creation Planning Grant, but should those assumptions not be taken forward, FS would need to consider the continuing role of those staff and the potential Transfer of Undertakings (Protection of Employment), redundancy or reallocation of those staff. 

The new rates across ELM were announced at the beginning of the year, and it was flagged that EWCO rates would be responding to those increased rates, to ensure people did not lose out in terms of their land use decisions. He outlined the new additional contribution to encourage woodland creation next to ancient woodlands as a further biodiversity supplement, and a new additional contribution to encourage people to plant on low sensitivity land, linked to the Woodland Creation Fast Track. It was also hoped the maintenance payment rates could increase from £350 to £400 per year for 15 years. Joe noted the need to keep monitoring how the uptake of the grant offer in comparison to other land uses.   

Joe updated the Board about Spending Review preparation, with full engagement with Defra across the SR initiatives, ensuring that the FC was fully represented. 

The Board thanked Joe for his update.

4.2 Joint Woodland Creation Position Statement (Forestry Commission and Natural England)

The Board welcomed Ian Tubby to the meeting. Ian updated the Board about Richard Stanford and Marian Spain’s request in spring 2023 that their advisors put together a document that would describe the types of woodland both organisations would like to see more of in the landscape, in order to move the conversation on past issues of disagreement and towards an more effective working relationship. The paper was signed off in May 2023, and was used internally in both organisations to demonstrate the need for more of all tree and woodland types in order to reach the statutory targets relating to nature recovery and Net Zero. Over the summer of 2023, external organisations such as the Royal Society for the Protection of Birds (RSPB), the Woodland Trust, Confor were given sight of the statement and were supportive leading to its publication in December 2023 on GOV.UK.   

Ian asked the Board whether it wanted him and his team to go further, and to produce a more strategic statement on woodland creation and delivery pathways which could showcase the work of the FC as a whole, and also highlight the work of Natural England.   There was an opportunity to bring in the Environment Agency, and possibly the RPA as well so that the Defra agencies could speak together with a single voice regarding woodland creation. There was also a discussion about bring this to the Committee on Climate Change (CCC).    

Edward Barker noted that whilst he could see a good case for adding the EA and RPA, he was less convinced by the need to involve the Committee on Climate Change. Anna Brown noted the CCC was an organisation taking natural carbon seriously so could help the cause.   

The Board discussed some area where the communication could be improved, and John Lockhart noted Adrian Jowitt’s support, particularly around the issue of permanency and long-term land use change.   

The Board discussed the work involved in bringing in other organisations and the necessary compromises, but it was felt the support from these, such as the National Trust, would help carry the message forwards.   

The Board discussed Defra’s land use framework, and Ian noted that his team had seen a draft of it, and could not see a conflict between the Joint Statement the framework at that point.

4.3 Responses to the Environment Audit Committee inquiry into the contribution of forestry to Net Zero and Biodiversity

Ian Tubby noted that he had been asked to produce a paper that focussed on government responses to recommendations made by the Environmental Audit Committee inquiry into sustainable timber and deforestation. The FC had provided the inquiry with evidence, and also worked with the Defra Forestry team to put together the government response to the recommendations. The recommendations for the FC were easily addressed, as they were mostly concerning certain aspects of either the UKFS review or the implementation of UKFS on the Forestry England estate. 

The first recommendation of the committee talked about the need for future strategies for forestry to be fully integrated to establish a clear and holistic vision for all woodland types. Ian and his team looked at what the total land take might be if all of the tree and woodland-related policies were delivered, whilst taking into account the different delivery pathways such as agroforestry, natural colonization, riparian woodlands, bioenergy etc. Ian’s team estimated that approximately 890,000 hectares of land use change would be required.   

He noted that it might be a good moment to revisit some of the assumptions around the delivery pathways, as it would seem there was a strong and coherent set of policies aimed at nature recovery, but with less coherence around what was happening with net zero and bioenergy and biomass policy. If all of the policies were to succeed at the moment, the FC would probably overdeliver on nature recovery and not achieve as much in terms of climate change mitigation and carbon. 

Ian asked the Board for their views on whether FS should carry on reviewing the different policy and delivery pathways and see whether recommendations could be made whereby we can still hit nature recovery and do more with net zero, or within a reduced land use take. Ian noted that it was important to capture wildlife rich habitat in Woodlands, even when dominated by conifer, as a proportion would have to be planted with native species to ensure UKFS compliance, so it would make sense for his team to capture that, progressing with NE and Defra, and also with RSPB.  

He noted how closely aligned the Woodland Trust, RSPB and Confor were to the FC at the Committee, and how helpful it would be to have ‘lines’ which FC leaders could take with Ministers which covered the strengths and weaknesses and the views of the other organisations. He asked the Board whether they considered this would be the same piece of work as the follow-on work from the Joint Statement with NE and the other Defra agencies, or whether it would be another piece of work with more external collaborators. Sir William noted that he thought this was two pieces of work, one for the Defra ALBs and one with a broader spectrum. To have alliances across organisations would make for very powerful messaging with politicians. 

The Board asked Ian about the hectares included in the target, and Ian talked the Board through the graph showing how the total land use change required broke down into different components.     

The Board discussed net zero policy, and the complexities within the bioenergy assumption. With the data, the FC could be in a position to highlight the differences between land use change aspiration and reality, and the of balance timber supply/climate change mitigation with nature recovery. The Board noted that economic arguments around revenue streams from land use change would hold a lot of sway with the public. Ecosystems capital and natural capital markets would support a lot of activity – grants would catalyse the change but landowners would need to see long-term revenue streams in order to make land use change, particularly when permanent.   

The Board thanked Ian for his two papers. The Board noted its support of the development of two strands of work.

5. Any Other Business

Sir William Worsley thanked Board members and closed the meeting. 

6. Date of Next Meeting 

The next scheduled Board meeting would be held on 23 and 24 May 2024 and will be face to face.