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Welsh Government Consolidated Accounts 2016–2017 gov.wales Annual Report Overview from the Permanent Secretary Shan Morgan I am pleased to be presenting my first consolidated taxes and public health. You will see more detail accounts on behalf of the Welsh Government. I took on these areas in the annual report along with a up the role of Permanent Secretary towards the specific focus on the timetable for devolved taxes. end of 2016-17 and I am grateful to my I have spent my first months listening to and getting predecessor, Sir Derek Jones, for his sound to know the staff in the organisation and have financial management across the reporting period. been impressed by the talent, professionalism I would like to thank Derek more generally for and commitment I have seen and by the real pride the solid foundations that I can build on as that colleagues take in serving their communities Permanent Secretary. and stakeholders. The scale and speed of the The last financial year set in motion a significant changes ahead are unprecedented and my top period of change. It began with the formation priority is to make sure that the civil service of the of the new Cabinet in May 2016 followed by Welsh Government is properly equipped to support the publication of ‘Taking Wales Forward’, the Ministers and help them deliver their objectives. programme for government for this Assembly term. I have introduced an initiative to future-proof our The First Minister also published ‘Securing Wales’ organisation to meet the challenges ahead by Future’, a white paper jointly developed with Plaid building a strong, skilled and sustainable workforce, Cymru, setting out the issues that are vital for capable of responding effectively to changing Wales as the UK moves to leave the European priorities. Union. Work continued to embed the Well-being of I am very grateful to colleagues inside and outside Future Generations Act at the heart of government. the Welsh Government for the warm welcome There were historic changes to the devolved they have given me. I am delighted to have the landscape in Wales too including the Wales Act opportunity to contribute to the future of Wales by 2017 receiving Royal Assent in January, bringing ensuring that public resources are used to the best important new powers. The Welsh Government’s possible effect and deliver services that make a legislative programme for the fifth Assembly real difference to people’s lives. commenced in May 2016 introducing wide ranging Bills relating to the abolition of the right to buy, new 2 | Welsh Government Consolidated Accounts 2016-17 Annual Report Contents Overview from the Permanent Secretary 2 The Welsh Government at a glance 4 Accountability Report Statement of Accounting Officer’s Responsibilities 25 Governance Statement 26 Remuneration and Staff Report 40 Losses Statement 52 Summary of Resource Outturn 53 Certificate and Report of the Auditor General for Wales 56 Financial Report Financial Statements 58 Notes to the Accounts 62 Appendix A – Accounting Policies 85 Appendix B – Glossary 93 Government of Wales Act 2006 Accounts of the Welsh Government are prepared pursuant to Section 131 of the Government of Wales Act 2006 for the year to 31 March 2017, together with the Certificate and Report of the Auditor General for Wales thereon. Laid before the Assembly on 31 August 2017 pursuant to the Government of Wales Act Section 131 Welsh Government Consolidated Accounts 2016-17 | 3 Annual Report The Welsh Government at a glance Overview The Welsh Government is the devolved continue to expand through new powers which will government for Wales. With an annual budget come on stream next year. of around £14bn net of £1.8bn income, Led by the First Minister, the Welsh Government the Government works across key areas of makes decisions and is responsible for delivery public life such as health, education, the in the areas devolved to it, as set out in the economy, agriculture and the environment. Government of Wales Act 2006 and the Wales It was formally created in 2007 under the Acts 2014 and 2017. This involves developing and Government of Wales Act, which established implementing policies; setting up and directing a division of functions between the National delivery and governance; proposing Welsh Assembly for Wales (the legislature) and the Welsh Laws (Assembly Bills); and making subordinate Assembly Government (the executive). The Wales legislation, such as regulations and statutory Act 2014 has since legally changed the name guidance. It also directly funds Welsh Government to the Welsh Government. The Welsh devolution Sponsored Bodies. settlement has evolved dramatically since the establishment of the Assembly in 1999, and will Taking Wales Forward Following the formation of the new Government To drive forward delivery a national strategy is the document Taking Wales Forward was being developed, to set out in more detail the published in September 2016 outlining the interdependent actions that will be taken to Government’s key priorities for delivering develop innovative solutions to the challenges improvements in the economy and public services, faced and help maximise the impact of public aimed at making a difference for everyone, at funds. The strategy has been prepared in the every stage in their lives. It focuses on enabling context of the Well-being of Future Generations people to live healthy and fulfilled lives and make Act, and this will inform its implementation. the most of every opportunity, and supporting them when help is needed most. 4 | Welsh Government Consolidated Accounts 2016-17 Annual Report The Cabinet From May 2016, the Cabinet and Ministers are: Rt. Hon Carwyn Jones First Minister Jane Hutt Leader of the House and Chief Whip Mark Drakeford Cabinet Secretary for Finance and Local Government Vaughan Gething Cabinet Secretary for Health, Well-being and Sport Lesley Griffiths Cabinet Secretary for Environment and Rural Affairs Carl Sargeant Cabinet Secretary for Communities and Children Ken Skates Cabinet Secretary for Economy and Infastructure Kirsty Williams Cabinet Secretary for Education Alun Davies Minister for Lifelong Learning and Welsh Language Rebecca Evans Minister for Social Services and Public Health Julie James Minister for Skills and Science Mick Antoniw Counsel General Welsh Government Consolidated Accounts 2016-17 | 5 Annual Report What the Welsh Government spends The level of funding available for devolved UK Government Departments and Devolved public expenditure in Wales is set through UK Administrations. Adjustments to the level of Government Spending Reviews. This is a Treasury- funding for Wales – negative or positive – are led process to allocate resources across all determined through the Barnett Formula. Expenditure in 2016-17 Expenditure is around £14.0bn which is net of The net expenditure as authorised by Welsh £1.8bn income. The majority of this income is Ministers is shown below: funding from National Insurance funds for Health, Well-being and Sport. A further £0.4bn is funding from the European Union. Health, Well-being and Sport £6.1bn Central Services and Administration £0.3bn Environment and Rural Affairs £0.4bn Communities and Children £0.8bn Economy and Infrastructure Total £0.9bn £14bn Education £2.2bn Local Government £3.3bn 6 | Welsh Government Consolidated Accounts 2016-17 Annual Report Welsh Government Accounting Boundaries 2016-17 Given the extent of devolved responsibilities, Fund for Wales LLP, WG Holdco Ltd and Careers the Welsh Government Accounts for 2016-17 Choices). Whilst the Welsh Government funds the cover the Welsh Government core (the Welsh Welsh NHS Trusts, Welsh Government Sponsored Government itself) and the Welsh Government Bodies and Commissioner Bodies they are Group (consolidation with Welsh NHS Local Health not consolidated into the Welsh Government Boards, Finance Wales, Regeneration Investment accounts. Organisations not included in these accounts Welsh Government Group Welsh Welsh NHS Welsh Large Welsh Local Government Local Health NHS Subsidiaries Authorities Trusts Core Boards Welsh Commissioner Government Bodies Sponsored Bodies Welsh Government Consolidated Accounts 2016-17 | 7 Annual Report Welsh Government balance sheet Described in the Accounts as the ‘Statement Network asset (£16bn), and the Local Health of Financial Position’ the Welsh Government’s Boards property portfolio (£3bn) Balance Sheet contains three major items: • Financial assets – primarily the current • Property, plant and equipment – consisting valuation of the Welsh Student Loans primarily of the current valuation of the Road book (£3bn). Welsh Government Road Network As the highway authority for trunk roads and Key components of the network include bridges, motorways in Wales, the Welsh Government tunnels, retaining walls and gantries. There are is directly responsible for the maintenance over 3,700 such structures on the motorway operation and management of this £16bn and trunk road network across Wales with an asset. There are over 75 miles of motorway estimated value of approximately £4.6bn. There and over 1,000 miles of trunk road. are five road tunnels on the network across Wales. There are over 75 miles of motorway and over 1000 miles of trunk road 8 | Welsh Government Consolidated Accounts 2016-17 Annual Report Local Health Boards property portfolio NHS infrastructure includes land and buildings, The NHS has 26 main hospital sites across but also other significant physical assets including Wales which are operated by the
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