Corporate report

Minutes: Forest Services board meeting 7 July 2023

Published 19 December 2023

Forest Services Board minutes of the 18th meeting Friday 7 July 2023 between 9am to 11.30am at Leonardo Hotel Swindon, and via MS Teams.

Present

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

Attendees

Jane Coles (for item 3.3)  
Ian Tubby (for item 4.1)  
Ewan Calcott (for item 4.2)  
Alex Stewart, FC Boardroom Apprentice  

No apologies

Minutes 

Gemma Thomas

1. Welcome and apologies 

Sir William Worsley welcomed attendees to the meeting.    

Sir William gave the Board an update on recent activities across the Forestry Commission.   He and Richard Stanford met the Secretary of State on 21 June, and she made clear her focus on tree planting.  They discussed the financial benefits of biodiversity net gain compared to those of woodland creation, and agreed that the economic model for forestry had to work.   

Various stakeholders continued to raise Paulownia concerns with Defra and as a result, Defra continued to seek further assurances.  In its capacity as a regulator, the Forestry Commission would host any meeting with stakeholders to explore concerns over the Paulownia Phoenix One® variant. 

Forestry England was authorised to create the first of the Coronation Woods, with Sutherland Wood planned to be planted by March 2025.  This will form part of a wider series of woods officially recognising the coronation of His Majesty King Charles III.  Sir William noted that the King was really interested in these woods which was very positive.   

The Forest Research Board met in Wales the previous week.  The Provisional Woodland Statistics had been published two weeks ago.  These provided provisional data on woodland area, certified woodland area and projects under the woodland carbon code, as well as provisional data on areas of new planting and publicly funded restocking.  Sir William noted that it was encouraging that planting numbers had increased by 40%.  The target remained a challenging one, but the trajectory was positive. 

Work on the Northern Research Station was nearing completion, bringing to a close a 3-year £10million investment in the site. 

2. Minutes of the last meeting and Declarations of Interest 

The minutes of the Board meeting on 25 May 2023 were agreed as a true record.    All actions were noted as discharged or in train.   

Sandy Storrie offered a correction to the minutes of the Extraordinary Board meeting on 26 June.  He noted that the minutes stated that ‘Sandy Storrie asked for the sequence of FS Board meetings to synchronise better with the ARAC meetings.’  He clarified that what he was advocating was synchronisation between the FS Board and the ARA timetable, giving the 2023 example of the ARAs being circulated on Wednesday 24 May, with an FS Board meeting the following day, in which there was no time to discuss the ARAs.  Ideally there should be a gap between circulation, and the Board meeting.  He noted he thought the FC should set the timetable for Board meetings, to ensure input into Business Plan production (at FS level), and ARA production (at FC level), and the meetings timetabled accordingly.  Sir William noted that he thought the following year’s Board meetings should be in calendars by June of the preceding year.   Anna Brown noted that a particular difficulty lay in getting all three sub-Boards to link up with the ARA timetable and ensuring Sir William’s and Richard’s attendance at all.   Sir William asked that the four Board secretaries worked together to plan meeting dates.   

He noted he was not convinced by an extraordinary Board meeting lasting 30 minutes to approve the accounts, feeling it was better if that could be done as part of a proper Board meeting.  He noted that the members were not actually approving the accounts, rather giving the go-ahead to the Accounting Officer to approve the accounts.  Anna Brown asked whether it made more sense to have one Commissioners meeting to approve the accounts, and Sandy Storrie noted that the challenge was slightly different for Business Plans and for ARAs.  The Board should endorse the Business Plan but did not need to input into its generation.  For the ARAs it would be helpful to have Board input during the drafting process, with a Board meeting at that stage to discuss in person, rather than via email, thought about the content of the ARAs.  Endorsement of the ARAs is currently given by the Boards, but is actually a matter foremost for the Accounting Officer.  A calendar that better reflected those requirements would be better suited than the current version.  Sir William suggested one meeting of Commissioners and Non-Executives at the ARA drafting stage would be an improvement, and would capture all the ARAC members in one meeting, rather than with their respective sub-Boards.  Richard Stanford noted that the input into the ARAs was crucial in giving reassurance to the Accounting Officer and was very useful. 

The final ‘rubber-stamping’ by the Board may be a necessary part of the process, but in terms of giving reassurance to the Accounting Officer, he did not feel it added any value.   Sir William noted that an approval meeting was desirable, but it would be preferable to have that as one central meeting for all Commissioners and Non-Executives, rather than the current model of the three sub-Boards.   

Action 

Gemma Thomas to pass these comments to Sarah Clancy and all FC Governance Officers and discuss, to aid the planning of all Board dates in 2024.

3. Key management and financial information  

3.1 Directors’ update  

Anna Brown introduced the FS Director’s Report.  She gave the Board some recent discussions around issues such as the Ministerial Direction, and also Presumption to Plant in low-sensitivity areas.  She noted recent positive conversations with the Crown Estate, and how the application process would work in those cases, and informed the Board about the positive work being done to reduce the backlog of Reference Committees.  Anna highlighted the recent record fine which would act as a disincentive to illegally fell.  She informed the Board about a recent OPM finding in Derbyshire, and noted that the team were confident they had identified the epicentre. 

Anna updated the Board about recent discussions around UKFS.  The current limit was 75% of a single species, which was felt not to give enough resilience going forward.  More diversification within the portfolio would be an improvement, and she noted how those conversations were nuanced across Scotland and England.    Ross Murray noted his recent conversations with Confor on this matter, and the input of the sawmills into the discussions.  Edward Barker noted that he would discuss the issue with Minister Harrison, and if necessary, it would go up to the Secretary of State.  Anna Brown noted that having Lord Benyon in the conversation, with his responsibility for biosecurity and resilience, would be useful.  Richard Stanford noted that there was a lack of data from Confor to suggest what the volume of timber reduction would be when planting something which is less yield class that Sitka, and the adaptations required by sawmills for novel species timber production.  The Board discussed the importance of resilience, and agreed that further discussions across the sector would be welcomed.  

The Board discussed the importance of getting regular updates on regulatory reviews, and underlined their willingness to help local engagement work, particularly in relation to Local Nature Recovery Strategies.    The Board discussed the need for more education across the sector in relation to regulations in the Forestry Act, and the responsibilities of the Forestry Commission and those of Local Authorities, to ensure those who wish to comply with regulations understand how to do so, and those who may wish to abuse regulations are not protected.  The Board discussed the timetable for Reference Committees, and noted their approval of the reduction in the backlog.  Anna Brown informed the Board about a recent meeting across 2 Forestry and Woodlands Advisory Committees (FWACs) for the FWAC Chairs, and the very positive discussions about how to better utilise the skills in those groups, and noted that it would be helpful to discuss that further at the next FWAC Chairs Meeting in October.  The Board discussed the value of extending the reach of the FC through the FWACs, and Sandy Storrie noted that there was a line in the remit of the FWACS stating that they were not promotional, and that that was confusing.  Anna Brown noted she would look into that. 

Action 

Anna Brown to investigate wording of the FWAC remit .

3.2. Risk, issue and opportunity register, and FS Dashboard  

Anna Brown updated the Board on recent updates to the risk register, and noted the ongoing work to the FC register, and the work that would then be undertaken on the FS register.    

Anna introduced the Dashboard, and Sir William noted his pleasure at reading about the changes in the organisation.  Steph Rhodes offered a correction to the data presented in the dashboards, which is inserted here for clarification:  

The total hectares of EWCO applications in progress and agreements issued over the first two years of the scheme (to 11 May 2023) is 52% higher than the total of CS agreements issued over the period 2017-2021 (>4,500ha vs c. 2,900 ha). Note that applications that transferred from CS to EWCO are counted under CS agreements; 

The total of EWCO hectares in agreement at 11 May 2023 (c. 3,100 ha) was already higher than the total of CS agreements issued over the period 2017-2021 (c. 2,900 ha). Again note that applications that transferred from CS to EWCO are counted under CS agreements.

Steph Rhodes noted that the forecast for woodland creation in 2024-5 was very low, and explained that for an unknown reason the NCF element of that forecast had fallen off the graph, and there should have been an additional bar of five to six thousand hectares.  She also noted that when the Board looked at the statistics published at the end of financial year 2022-23, particularly for EWCO, it looked mostly at the planting that happened in the winter of 2021-22, and the estimate at the present time was that the trend would have further increased last winter by an additional 1600 hectares.  Ross Murray noted the Dashboards were very useful, and asked whether the new planting figures could show the target for England, not for the UK, which would help contextualise the information visually.   

Richard Stanford praised the team for turning EWCO around in difficult circumstances and noted that the trajectory was going in the right direction.  However, the impact of inflation and high interest rates was still unknown, and he noted that commercial investors looking for returns may be able to get better returns elsewhere rather than in land prices.  He noted that a focus needed to be maintained on policies which enable planting, such as presumption to plant, and on activities which made the economic case for woodlands better, and ensuring that all supporting decisions were fully linked up and robust.  

Hilary Allison noted that whilst there was plenty of information on the ‘expand’ part of the strategic goal, there was less information to be had on the ‘connect’ part, and whilst appreciating it was not easy information to generate wondered whether information covering the number of schemes that physically have a connection with other with existing woodland could be recorded.  She also noted that the data showed the ways in which current policies were pushing planting proposals into areas with some constraints such as breeding waders or peat soils was interesting and worthy of attention. 

Action 

Steph Rhodes to investigate with David Cross whether the new planting figures could show the target for England.   

Anna Brown to investigate with David Cross whether an additional dashboard could be created to better demonstrate woodland connectivity.

3.3 Finance update 

Derrick Osgood updated the Board on that since the finance paper had been written a number of the Q1 transfers to Defra had been made.   The AP2 RDEL forecast was circa £3million over Defra Uplifted AP which was 7.5% and considered low risk.  He noted that a lot of the accruals put in for year end had been reversed, and drew the Board’s attention to the forecast of £93million and that last year the outturn was £60million.  Derrick updated the Board about the pay remit and the non-consolidated payment to staff.  He also highlighted the work done to rationalise finance reporting in FS.  Anna Brown noted the good work on raising financial awareness in FS, but reported there still work to do for Cost Centre Managers to have really good visibility and to enable rigorous FSET financial decision-making.    

The Board probed the increase in outturn, and Steph Rhodes detailed the information behind the confidence in the viability of that increase.  The Board heard about Defra shared services and the conversations ongoing.

3.4 FS business plan quarterly update  

The board welcomed Jane Coles to the meeting.  She updated the Board on the RAG ratings, noting the further instruction that had been given to staff, and work to ensure closer alignment with NCF reporting.  Jane noted work being done on change control processes.  She flagged ongoing issues such as recruitment to key roles in IT and project management, and noted the ongoing work to ensure sufficient capacity in the operational delivery team.  

The Board discussed the development in the trade for ecosystems services. Steph Rhodes updated the Board on the work of the economists to inform the public about EWCO and Biodiversity Net Gain.   

Anna Brown asked the Board whether the information they received for the Business planning item was too in-depth and therefore not necessary for the overall understanding.  The Board asked whether the information was being produced for them specifically or whether the information was being generated anyway.  Anna Brown noted that at this stage the report was being produced specifically for the Board, as the internal processes around the Business Planning process were still being fully developed.  The Board suggested a distillation of information, and Anna Brown noted that the information contained in the Dashboard and KPIs would give the Board an indication of whether activities were on track.  The Board should look in-depth at the Business Plan quarterly, but the information presented could be more targeted/less detailed.  The activity Dashboard highlighted some really important points, and the Board also suggested that the Dashboard could reference key areas in the more detailed document to provide the link, with the Board considering the full document one per year.   

4. Items for discussion  

4.1. The regulation of Paulownia hybrid ‘Phoenix One®’ in England   

The Board welcomed Ian Tubby to the meeting.     Ian updated the Board on a recent meeting with Defra, Natural England and APHA in which Paulownia was discussed (sharing most of the information included in the Board paper), and in which participants were asked to provide any additional information to enable to regulation of Paulownia Phoenix One®.  That meeting stayed focussed on Paulownia Phoenix One® rather than other species e.g. Paulownia tomentosa, as the future evaluation of other emerging  species/hybrids is a slightly different issue.  Ian noted that no new evidence was presented, and therefore regulation of any new proposals which contain Paulownia Phoenix One® would continue, as had been happening to date, and would be reviewed on a site-by-site basis. 

There were no foregone conclusions, and consents and constraints would be put in place which were very similar to those used already.  If the FC was to stop regulating Paulownia Phoenix One® a Ministerial Direction would be required. The paper would also go to the Trees and Woodlands Scientific Advisory Group (TAW-SAG).  There was going to be a visit to the University of Bonn in Germany in early August to see planting there.  Ian noted that all the evidence suggested that neither of the parents species of Paulownia Phoenix One® were invasive.  The university claimed that that the hybrid is sterile, and the FC had no evidence to counter that. 

Anna Brown noted that the German trial was a decade ahead of the UK, and that would flag up any potential invasiveness issues for the UK early on.   She also noted that there might turn out to be other reasons to regulate Paulownia Phoenix One® under and EIA, but there was no evidence for that at the moment.  She noted that Paulownia Phoenix One® was more akin to an agricultural crop than a forestry one, and would often displace crops such as sugar beet, rape and potatoes, and that the environmental values were much in favour of planting on those sites.   

Edward Barker noted that across Defra there were concerns about novel species, and also noted that the recent session which Richard Stanford had hosted did give good reassurance.   Hilary Allison noted that she wanted to be reassured about the level of scrutiny to which the evidence had been subjected.  Anna Brown and Ian Tubby discussed the precautionary principle and its application, and its relevance to the regulation of Paulownia Phoenix One®, and Ewan Calcott noted the issue of the porosity of borders and the work done over several years to identify all the links in the chain of regulatory custody.  Ian Tubby outlined the process of evidence assessment and review, to give more detail to answer Hilary Allison’s question.   

Richard Stanford noted that it was important for the Board to understand that the Forestry Commission was regulating Paulownia Phoenix One® currently, and the checks and balances were in place.  If the FC were to change its mind, it would need to be completely clear on what basis.   Regulation cannot stop, unless there was real evidence to show it must be.  If there was ever a judicial review of any decision to change, evidence would have to be completely clear.   Ross Murray noted his reassurance at both the point about sterility, and that there were sufficient processes in place should it turn out to be invasive, and therefore his recommendation was to proceed.   The Board noted that they were happy with the paper and with progress to date.  

4.2. How can FS use the presumption to Plant Mapping to speed up planting in low-risk areas prior to LURB, and update on revocation of ministerial direction  

The Board welcomed Ewan Calcott to the meeting.  Ewan gave the Board an overview of his presentation.  He noted that low sensitivity mapping areas have no obvious interested authorities for the FC to consult with and it was usually ecological and site-based issues which needed addressing when it came to woodland creation.   On that basis UKFS compliant proposal would be agreed to in these low sensitivity areas unless site visits flag issues that have not been mapped at a national level – this should speed up the process for applications on these sites.   The focus can then be on the high sensitivity areas, including protected sites, and the medium sensitivity areas which are the protected landscapes and the higher value agricultural land which we accept take longer to approve.   Ewan asked the Board whether they were happy for the team to pursue this approach with Defra to introduce presumption to plant plan in those low sensitivity areas, whilst we continuing to improve the data that underpins that.    

The Board discussed the removal of some regulatory hurdles to planting, and the data supplied through the grant process.  Richard Stanford noted the proposed removal of the Ministerial Direction, and the Levelling UP Bill which would address the EIAs, and noted that the FC would always have an oversight as the competent authority in the Forestry Act.    Anna Brown explained the Ministerial Directions relating to the Forestry Act,  and updated the Board on proposed revocations.   Ewan Calcott gave the Board an update on consultation reform that would flow from the proposed revocation of Ministerial Directions.    The Board discussed the intention to make regulatory processes much smoother and faster, and how staff would be informed and empowered to work differently as a result.  The Board discussed the timeline and the communications of the announcement.    Ewan updated the Board on mapping activities to support this work.  The Board also discussed the sector’s frustrations and the reputational impact on the FC, how these changes could improve frustrations, and how important communications would be.     

4.3 Improving progress with Defra Legal 

Edward Barker updated the Board on the delineation of responsibilities relating to legal work in Defra, and noted some issues of resourcing in the legal team which had improved.   The Board discussed the frustration resulting from blockages in the process.

5. Any other business 

Alex Stewart, the Boardroom apprentice, gave his initial thoughts on how the presentation of Board papers could be made clearer.   

Action 

Alex Stewart to present his thoughts to the FS Board in November 2023 on whether he has found the Boardroom Apprentice scheme to be of benefit, how it could be made even more valuable, and whether he thought there was value both ways.     

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 Tuesday 19 and Wednesday 20 September, in person in and around Thetford, Norfolk.