Politics
Welsh Government pays £13m to settle contract claims
THE WELSH Government made a £13m “special payment” to settle claims over road contracts and lost more than £2m on defunct technology, according to scrutiny of annual accounts.
Welsh ministers shelled out £13.1m, excluding VAT, after contractual claims for additional money for three road projects amid spiralling costs due to high inflation.
Andrew Goodall, the Welsh Government’s permanent secretary, said in a letter that his officials sought to settle all claims with the contractor in the interests of value for money.
Pressed by the Senedd’s public accounts committee about the consequences of not settling, Dr Goodall raised the risk of delays to roadworks and the loss of European funding.
He wrote: “Not settling all claims would have left the Welsh Government open to the risk of unsettled claims being leveraged by the contractor at a later date.”
Wales’ most senior civil servant added: “Whilst there’s no guarantee the contractor would have commenced formal dispute proceedings for amounts they considered were due, it was deemed that there was a real chance of them doing so.”
He said such push back was not unique to the Welsh Government, with other public bodies also grappling with the reality of contractors no longer being willing to take on certain risks.
In his letter to the public accounts committee, the ex-NHS Wales chief confirmed the payment was discretionary and made as a result of the government’s policy position.
Politicians on the committee called for more information in their scrutiny of the Welsh Government’s 2023-24 accounts which provided few details of the “special payment”.
Members questioned how the £13.1m compares to the overall value of the road projects and whether it represents a negotiated settlement below the total value of the contractor’s claims.
The committee also called for clarity after the accounts revealed a £2.27m loss to the public purse from spending on “defunct” equipment for a green social housing scheme.
As part of its “Optimised RetroFit Programme”, the government made a “fruitless payment” for intelligent energy systems (IES) only to discover the devices could not be upgraded.
Explaining the loss, Dr Goodall pointed to a lack of clarity in reporting and escalation which meant the Welsh Government was unaware the units were useless until it was too late.
He wrote: “A detailed and thorough lessons learnt process has been completed, in which all parties have considered and reflected upon their role and responsibilities….
“The initial IES devices represented one of the first tranches of monitoring units of this kind, so were exposed to the inherent risks associated with new technologies.”
In his foreword to the report, chair Mark Isherwood outlined serious concerns about the Welsh Government’s “unsatisfactory” oversight of 48 arm’s-length bodies.

Ministers have paused a programme of tailored reviews, with only two completed – for the National Library of Wales in 2020 and Amgueddfa Cymru (Museum Wales) in 2023.
The public accounts committee has criticised a move to an alternative lighter-touch, self-assessment model which has taken more than six years to implement.
The report, which makes 18 recommendations, also expressed concerns about a data breach as the Welsh Government rolled out a new HR system called Pobl.
Dom Houlihan, director of people, told the committee: “Some line managers were able to view data they shouldn’t have been able to,” prompting an immediate security review.
The scrutiny report, which was published on Monday, called for an update on the Welsh Government’s £14m attempt to attract sports carmaker TVR to Wales.
Ministers spent £4.75m buying a factory in Ebbw Vale in 2021, £7.6m on refurbishment, £2m on a five-year loan for TVR and £500,000 on shares – only for the venture to fall through.
The committee said: “We are concerned the property remains vacant and the investment as it currently stands is not generating any income nor representing value for money.”
Senedd members also expressed concerns about the damning “no assurance” findings of internal audits of the Welsh Government’s framework for managing major projects.
Their 60-page report similarly raised alarm bells about a leaked staff survey which painted a picture of a culture department in “chaos”, with “no sense of longer-term strategic planning”.
Politics
Ceredigion council tax expected to rise by 4.7 per cent
A BETTER financial settlement for Ceredigion from the Welsh Government along with a fresh grant is expected to see council tax bills in the county rising by less than five per cent this year, far below previous fears of a rise as high as nearly nine.
Last year, for the 2025-’26 budget, Ceredigion saw a council tax rise of 9.3 per cent.
While council tax makes up a proportion of the council’s annual revenue, a crucial area of funding is the Aggregate External Finance (AEF) rate from Welsh Government.
Ceredigion was to receive a 2.3 per cent increase on its settlement, some £3,388,000 for a total of £150,670,000, placing it at joint 13th of the 22 local authorities in Wales.
Following a later Welsh Government and Plaid Cymru agreement additional funding for local government was secured, giving Ceredigion additional funding.
Back in November, before the increased settlement was announced, Ceredigion Leader Cllr Bryan Davies said that early estimates indicated that an 8.9 per cent increase in council tax would be necessary, but an improved position of 6.9 per cent had been indicated as a result of a further modelling of service cost pressures and operational savings.
Following the improved settlement, members at the January meeting of Cabinet heard from Cabinet Member for Finance and Procurement Services Cllr Gareth Davies a recommendation for a 4.75 per cent council tax increase as part of a draft budget requirement of £221.493m was being mooted.
That position has improved again, following financial support towards the Mid and West Wales Fire Service Levy, members of the February 3 meeting of the council’s corporate resources overview and scrutiny committee heard, the funding now dropping the expected council tax increase to 4.7 per cent, equivalent to an extra £7.39 per month for the average Band D property for the next financial year.
Members of the committee agreed to note the 4.7 per cent figure, with the final council tax recommendation being considered by Cabinet on February 10; the final decision on the budget being made by full council on March 2.
international news
Mandelson quits Lords amid police probe over Epstein links
Peter Mandelson has announced he will retire from the House of Lords with immediate effect, as mounting political and legal pressure grows over claims he shared sensitive government information with convicted sex offender Jeffrey Epstein.
Parliamentary officials confirmed that Peter Mandelson formally notified the Clerk of the Parliaments of his decision, ending his membership of the upper chamber from Tuesday (Feb 4).
The move follows reports that the Metropolitan Police Service is reviewing allegations of possible misconduct in public office connected to emails said to have been forwarded to Epstein while Mandelson was business secretary during the 2008–09 financial crisis.
Downing Street has confirmed that material has been passed to police after an initial Cabinet Office review.
Government fury

Prime Minister Keir Starmer told cabinet colleagues Mandelson had “let his country down”, according to No 10, and officials are now drafting legislation that could strip him of his peerage entirely.


Removing a life peer is rare and would require an Act of Parliament.
If passed, Mandelson would lose the title “Lord” altogether — an extraordinary step that has only been considered in the most serious cases.
Senior ministers have described the alleged passing-on of market-sensitive government discussions as “disgraceful” and a “betrayal of trust”.
What police are examining
Misconduct in public office is a centuries-old common law offence that applies where someone in a position of public trust wilfully abuses that role. It carries a maximum sentence of life imprisonment.
Investigators will assess whether confidential information — particularly relating to government financial policy during the crash — was shared without justification and whether safeguards were breached.
At this stage, no charges have been brought.
Mandelson has previously apologised for maintaining contact with Epstein after the financier’s conviction, saying he regrets “ever having known him”, but he has disputed some of the latest claims and has not commented directly on the police review.
Political shockwaves
Opposition parties are pushing for further disclosure of documents relating to Mandelson’s vetting and his past roles.
Conservatives are expected to force a Commons vote demanding more information, while Liberal Democrats have called for a public inquiry.
Several MPs have also suggested Mandelson should be removed from the Privy Council.
The developments mark a dramatic fall for one of Labour’s most influential political figures of the past three decades, who only months ago was serving as the UK’s ambassador to Washington.
Now, with police examining evidence and legislation being prepared to remove his title, his public career appears effectively over.
More updates are expected as the investigation continues.
Community
Cilgerran Church in Wales school petition to be heard
A PETITION opposing proposed changes for a north Pembrokeshire school is to be heard by councillors later this week.
At last May’s meeting, Pembrokeshire County Council considered a report of the School Modernisation Working Group which outlined the findings of a review of education provision in the Preseli area.
A later July meeting backed a general consultation to discontinue Cilgerran Church in Wales Voluntary Controlled School, and to establish it as a 3-11 community school.
“In particular, the review considered the extent of surplus school places in the area, set against a significant decline in the pupil population,” the council in its consultation has said.
The consultation closed on January 30.
Hundreds have opposed the proposed changes, with a petition, on the council’s own website opposing the changes recently closing after gaining 391 signatures.
Any petition of more than 100 signatures triggers a debate at one of the council’s scrutiny committees, in the case of Cilgerran that debate taking place at Pembrokeshire County Council’s February 5 schools and learning overview and scrutiny committee.
The Cilgerran e-petition, created by Louise Williams, raised concerns including the school could become part of a federation, a loss of permanent head teacher on site, a shared head teacher would have to oversee several schools, loss of funding control and the ability to maintain the school’s current healthy and stable funding, and a loss of commitment to the church, in turn could impact on the school’s and pupils values, beliefs and cultural beliefs.
It said: “Ysgol Cilgerran VC school has strong links with the Church community in Cilgerran and we believe this will have a negative impact on the children who attend the school, the community of Cilgerran and the links between the two.
“We are proud of our school ethos and values which are strengthened by our links with the church. The school has close and strong relationships with our Church in Wales federation governors one of which is also our safeguarding governor.
“Our Church Federation governors work closely with the school and are regular visitors to the school and the children. They provide vital support and guidance to the school and have a positive impact on the Children’s education. We believe these links will be weakened by this proposal to remove our VC status and we believe this is an un-necessary action.”
The proposals for Cilgerran are part of a wide range of potential education changes in the county.
Two petitions, opposing the potential closures of Manorbier and Ysgol Clydau schools, were recently heard at full council and a further petition opposing the potential closure of Stepaside School has recently been launched, which has generated enough support to be heard at a future council meeting.
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