Natural Resources Wales timber scandal 'incompetence, not corruption'

The sale of timber by a Welsh quango to three firms without going to the open market was the result of incompetence, not corruption, its chief executive has said.

Natural Resources Wales' Clare Pillman admitted the scandal had damaged the organisation's reputation.

Her appearance at an assembly committee comes after NRW saw its accounts criticised three years in a row.

Tory AM Nick Ramsay said the evidence heard at the hearing was "staggering".

The Public Accounts Committee hearing heard that 13 sales contracts were made without hard copies being signed - meaning they would have been legally unenforceable.

Earlier this year Natural Resources Wales was strongly criticised by the Wales Audit Office for handing out timber deals in 2017 without offering them on the open market, despite being attacked before for doing the same in a previous deal.

The committee heard the contracts were not made at market rates. The taxpayer lost at least £1m on the deals.

Plaid Cymru AM Adam Price asked the chief executive if it was her view "that these terrible failings are nothing to do with corruption and all to do with incompetence".

"Yes," Ms Pillman said.

NRW has had its accounts criticised by the Wales Audit Office three years in a row after it sold timber repeatedly without going to the open-market.

The original contracts, made in 2014 and worth £39m to NRW, were awarded without tender to BSW Timber.

When that deal ended early because BSW Timber did not build a new sawline it had promised, NRW awarded a number of "transitional contracts" with BSW Timber and two other firms.

It did so without a tender, despite a damning audit report in March 2017 criticising how the original deals were handled.

AMs on Monday were told that signed hard copies were not made of 13 of the transitional contracts.

Peter Garson, head of commercial operations, apologised. "It was an oversight, he said.

"You need a signed hard copy to be able to deal with any disputes."

Pressed by Lee Waters, in his last appearance at Public Accounts Committee, Mr Gason added: "Yes you could say it wasn't enforceable, the ones that were not signed".

He admitted it was a major failing.

Mr Garson also admitted he should have followed up advice that the transitional arrangements raised legal risks under EU state aid rules.

Ms Pillman apologised to the public, AMs and staff for the organisation's "serious failings identified in the report regarding our timber sales".

She said she fully accepted the findings made by the previous auditor general, Huw Vaughan-Thomas.

Ms Pillman said the transitional contracts were let in "difficult circumstances" with the "best of intentions" but accepted there were "errors and irregularities" in the way they were put in place.

She said all the transitional contracts had ended and that NRW had began remarketing timber on the open market last year.

It is not the first time Public Accounts Committee has looked at timber sales at NRW. Mr Ramsay said Tuesday's session was like "ground-hog day".

Mr Ramsay said: "The evidence we heard from Natural Resources Wales today was, at times, staggering.

"It is of deep concern NRW apparently haven't learned the lessons of our last report on the awarding of timber contracts without proper competitive tendering.

"NRW has a lot of work to do to repair the self-inflicted damage to their reputation. The positive aspect of our meeting being that they are apparently now ready to do that."