A New Tribunal System for Wales: white paper - Chapter 5: Independence

We propose:

• all those responsible for the administration of justice in Wales should be under a statutory duty to uphold the independence of the First-tier Tribunal for Wales and the Appeal Tribunal for Wales, and
• the creation of a statutory body arms-length from Welsh Government with operational responsibility for the administration of the First-tier Tribunal for Wales and the Appeal Tribunal for Wales.

86. Judicial independence is the principle that guides the way in which judicial institutions are and will continue to be supported in Wales. Whilst our approach to administering the Welsh Tribunals through the Welsh Tribunals Unit has developed over time, the Unit remains part of Welsh Government. Protecting judicial independence and giving greater structural independence to the administration of justice is a key objective of the structural reforms we are proposing to modernise our tribunal system in Wales.

87. The Law Commission recommended a statutory duty to uphold the independence of the devolved tribunals (see Annex 2, Law Commission recommendation 52). The Commission on Justice in Wales (“the Thomas Commission”) was of the view that it is essential the judiciary and other institutions have an independent relationship with the Welsh Government and Senedd and that a statutory duty as regards independence should be in place (Justice in Wales for the people of Wales, paragraph 12.177). Statute makes provision designed to guarantee continued judicial independence at a UK level (Section 3 of the Constitutional Reform Act 2005), but there is no current statutory protection for independence that applies across the devolved tribunals. We consider a statutory duty to uphold independence is consistent with the continued development of our devolved tribunal system as a cornerstone of Wales’ emerging justice system.

88. We propose a statutory duty to uphold judicial independence could potentially apply to all those with responsibility for the administration of justice as that applies to the reformed tribunal system and the members of the new tribunals. Thus, the duty could potentially apply to the First Minister, the Welsh Ministers, the Counsel General and any other persons discharging a responsibility as regards the new tribunals.

89. The duty should include a duty to have regard to the need for members of the tribunals to have the necessary level of support to enable them to carry out their functions.

90. The duty could also apply to all Members of the Senedd, given that the Senedd has ultimate responsibility for Wales’ constitutional arrangements and for decisions on public expenditure, including the level of funding that would be available for the operation of the tribunals. We note that a similar duty applies to Members of the Scottish Parliament. However, while we hope that all Members of the Senedd would support the independence of the judiciary, there are legitimate questions which could be asked about the practical implications of such a duty and whether it could impact on free speech during Senedd proceedings. We would therefore see it as a matter for the Senedd Commission to consider as to whether it would be appropriate to include such a duty.

91. The Law Commission recommends all members in the new tribunal system should be required to take a judicial oath or affirmation (see Annex 2, Law Commission recommendation 53).

92. At present, only the President of Welsh Tribunals is required to take the oath of allegiance and the judicial oath as set put in sections 2 and 4 of the Promissory Oaths Act 1868 (Paragraph 14 of Schedule 5 to the Wales Act 2017). By contrast, similar legal requirements apply to all members of the Scottish Tribunals (Paragraph 11 of Schedule 7 to the Tribunals (Scotland) Act 2014) and to the Senior President of Tribunals and all members of the UK First-tier Tribunal and the Upper Tribunal (Paragraph 11 of Schedule 1, paragraph 9 of Schedule 2, paragraph 10 of Schedule 3 and paragraph 8 of Schedule 4 to the Tribunals, Courts and Enforcement Act 2007). In Northern Ireland, the judicial oath has a different formulation (Section 19 of the Justice (Northern Ireland) Act 2002).

93. Oaths have a clear historical and symbolic significance across the UK's justice systems. They also have a practical significance in terms of the perception of judicial independence. That said, there is a rational argument that a modern justice system should not rely on office holders taking oaths to each affirm they exercise their respective duties guided by principles of equality, fairness of treatment and the rule of law. Requirements on individuals to act in certain ways would be more clearly justiciable if directly written into statute or were a matter of contract embodied by the terms and conditions of a person’s appointment as a member in the new tribunal system in Wales.

94. If, however, all members of the new tribunal system are to be required to take an oath or affirmation to enhance the public perception of judicial independence, we consider a modern formulation of the form of oath or affirmation will be compatible with the ethos of the new modern tribunal system for Wales. Such an oath or affirmation could be broadly akin to the following:

I .… do swear [or solemnly and sincerely and truly affirm] that I will well and faithfully serve in the office of …. and that I will do right to all manner of people without fear or favour, affection or ill-will according to the laws and usages of this realm.

95. The remodelling of the administration of our nascent justice system in Wales is a necessary part of the journey towards building a justice infrastructure for Wales capable of adopting jurisdictions and growing and evolving over time.

96. The Thomas Commission and the Law Commission both concluded that the current arrangements for the administration of the Welsh Tribunals, whereby the Welsh Tribunals Unit, embedded in and part of Welsh Government, provides administrative support services, does not sufficiently establish the perception of judicial independence.

97. The Thomas Commission preferred to see operational responsibility for the administration of devolved tribunals reformed on the model of the Scottish Courts and Tribunals Service (“the SCTS”) (Justice in Wales for the people of Wales, paragraphs 12.162 to 12.165). The SCTS is a body corporate established by statute. The commission recommended the Welsh Tribunals Unit should have structural independence from Welsh Government (Justice in Wales for the people of Wales, paragraphs 6.58 to 6.59).

98. The Law Commission also recommended structural independence for the future administration of the system of devolved tribunals in Wales (see Annex 2, Law Commission recommendation 51). Whilst the Law Commission offered some general principles to guide the design and establishment of a body, neither the Thomas Commission nor the Law Commission offered any detailed recommendations about the structure, composition and functions of the body (although they did express views on its status, discussed further below).

99. We agree the judiciary must be, and must be seen to be, independent of the executive and legislative arms of government. The fundamental question to address is therefore whether the independence of the new tribunal system is best served if functions of administering the system are part of or are separate from Welsh Government.

100. There are 2 principal models that could be deployed for the administration of the new tribunal system, while providing for greater structural independence:

1. Administrative arrangements could be made, for example through a framework document. His Majesty’s Courts and Tribunals Service (HMCTS), for example, is not established in statute. It is commonly described as being an executive agency responsible for administrative functions for the courts and tribunals of England and Wales and is part of the Ministry of Justice. HMCTS is now managed jointly by the executive and the judiciary with the Senior President of Tribunals sitting on the board, strengthening judicial independence in the administration of tribunals. (HMCTS is governed by a framework document that sets out partnership arrangements between the Lord Chancellor, Lord Chief Justice and the Senior President of Tribunals).
2. Alternatively, the level of independence could be set by statute. The Scottish Courts and Tribunals Service is an example of a statutory body corporate (Part 4 of and Schedule 3 to the Judiciary and Courts (Scotland) Act 2008) independent of the Scottish Government and constituted with the function of providing administrative support to the Scottish courts and tribunals.

101. In proposing a model, our objective is to create structural separation between responsibility for operational and administrative functions for the new tribunal system (with an appropriate level of judicial involvement in that) and the executive and legislative functions of the Welsh Government and of the Senedd respectively. Although these operational and administrative functions are executive rather than judicial, on balance we believe that it is right for these functions to have a greater degree of separation from government than can be provided if they remain delivered by an arm of government, for example by an executive agency.

102. We therefore propose to legislate to create a body corporate as a separate legal entity, at arms’ length from Welsh Government and with operational responsibility for the administration of the new tribunal system. We consider this model will deliver the structural separation and independence from Government that aligns with the guiding principle of judicial independence and the weight of opinion expressed by both the Thomas Commission and the Law Commission.

103. For the purposes of this consultation, we call the proposed statutory body “Tribiwnlysoedd Cymru / Tribunals Wales”, its name to be formally considered and confirmed in due course.

104. There will of course be an on-going relationship between Tribunals Wales and the Welsh Government, the nature of which will be informed by the way in which Tribunals Wales is constituted.

105. The purpose of Tribunals Wales will be to assume operational responsibility for the new tribunals service by exercising the functions and powers conferred on it by primary legislation within the budget set by the Welsh Government. The legislative and governance frameworks put in place will define the extent of the Welsh Ministers' accountability for Tribunals Wales.

106. Our proposed structure and governance for Tribunals Wales is set out in Table 1, below. Unlike current arrangements, we propose it is governed by a board. The board would have a combination of executive, non-executive and judicial members. Its overall function would be to oversee the governance and operation of the body.

107. Our proposals include a requirement for the board to complete a corporate plan and to publish an annual report and accounts, as is generally considered best practice. The annual report would be expected to include information about the operational performance of the tribunals and their chambers – including measures around efficiency of operation, and the frequency with which decisions of each chamber were appealed or changed upon internal review. We would also expect (where possible) for the report to include user satisfaction measures.

108. The creation of the board that includes judicial oversight of the new tribunal system provides the foundation to collect key performance information about the operation of the system. Key performance measures to be monitored by the board would be determined in due course. We see these as including matters such as the use of the Welsh language in the tribunals system, differential experiences of tribunal users from different backgrounds and the diversity of tribunal members.

109. The proposals in Table 1 include a limited power for the Welsh Government to make requirements of the board; for example, these might include provisions which the government would find helpful to see included in its annual report.

110. Annual reporting is one of the ways in which dialogue is maintained between the different branches of government – but it is not the only way in which we would expect that dialogue to continue. For example, the Counsel General and Minister for the Constitution meets regularly with the President of Welsh Tribunals, and we would expect that to continue. It is important that there is regular exchange of information about the operation of the law and the impact of governmental decisions.

111. Similarly, although these things are not all matters for the government, we have welcomed the practice of the President of Welsh Tribunals being regularly invited to appear before a Senedd committee to discuss his annual report, and of that report being debated in the Senedd. We would welcome a similar practice developing with regard to the annual reports of Tribunals Wales.

112. A particular point to highlight is that we propose the Chair for the Board of Tribunals Wales should be a non-executive member selected through an open and fair public appointment process. In his evidence session to the Legislation, Justice and Constitution Committee, on 13 March 2023, Sir Wyn Williams, then President of Welsh Tribunals, said he favoured a judge acting as Chair because that would, in perception terms, ensure that independence is preserved.

113. Both examples exist elsewhere in the sphere of organisational leadership of justice bodies. The Chair of the Scottish Courts and Tribunals Service is the Lord President, the most senior judge in Scotland, whereas the chair of HMCTS is non judicial but a person who has held senior business positions and as a leader of organisations (having been selected through an open competition focused on chairing and leadership skills, rather than the process by which senior judges are selected which necessarily has to give significant weight to other factors) (Legislation, Justice and Constitution Committee, paragraph 15).

114. The structural independence of Tribunals Wales will be guaranteed by its establishment in statute and the functions, duties and powers conferred on it by that statute, as set out in Table 1.

115. Every public body also has a status, and there are 2 principal statuses of devolved statutory bodies in Wales. It is important to note, however, that neither of these models is inherently more independent than the other. Other than the characteristics of whether their staff are civil servants or not, both of the below models appear to us to be compatible with the arrangements at Table 1.

1. The first potential model is that Tribunals Wales could be constituted as a non-ministerial department (“NMD”). This was the model recommended by the Thomas Commission and the Law Commission. NMDs are staffed by civil servants. An example in Wales is the Welsh Revenue Authority.
2. Another potential model is a Welsh Government Sponsored Body (“WGSB”). There are a number of WGSBs operating independently of Welsh Government and an example operating in the justice sphere is the Valuation Tribunal for Wales (“the VTW”). The VTW and its governing council was established by subordinate legislation made by the Welsh Ministers (The Valuation Tribunal for Wales Regulations SI 2010 No.713 W.69). A framework document (Valuation Tribunal for Wales framework document) sets out the broad framework within which the VTW operates and details the terms and conditions under which the Welsh Ministers provide funds to it. Its staff are public servants but not civil servants.

116. As stated above, both of these models appear to us to have the potential to provide sufficient structural independence. The principal impact we have determined of the decision between the 2 options is the implication for the management of the organisation and for its staff. A decision on the model to be pursued has the potential to impact on staff of the Welsh Tribunals Unit and the Valuation Tribunal for Wales, and on the ability to attract and reward staff in the future. We are therefore interested in hearing views on the implications of this decision, and indeed whether there are other ways of providing structural independence which have advantages beyond these 2 models. We plan to use the consultation period to engage with staff and trade unions, and we will continue to do so as we develop legislation to implement reform.

Areas:

• Establishment
• Purpose
• Board
• Staff
• Finance
• Corporate governance
• Transfer of staff
• Transfer of property and liabilities
• Consequential matters

View in table format

Establishment

Statutory provision: Incorporation

A body corporate known as “Tribunals Wales/Tribiwnlysoedd Cymru” (proposed name for working purposes only). Creates a statutory body with legal personality.

Welsh Ministers’ accountability

Determined by the legislative framework for Tribunals Wales.

Statutory provision: Status

As a general principle the Law Commission concluded the administration for the tribunal system should be staffed by civil servants, which is usually the status of staff employed by an NMD. We are consulting on options.

Welsh Ministers’ accountability

The portfolio Welsh Minister will account to the Senedd, along with the Permanent Secretary and the CEO and Chair of the Board.

Purpose

Statutory provision: Objective

To have operational responsibility for the administration of the new tribunal system and to exercise its functions to provide services to ensure the effective administration of the First-tier Tribunal for Wales and the Appeal Tribunal for Wales and to support members to discharge their functions.

Welsh Ministers’ accountability

Creates structural separation between operational responsibility for the administration of the new tribunal system, sitting with Tribunals Wales, and policy functions sitting with the Welsh Government.

Statutory provision: Functions and powers

Statute to detail functions of Tribunals Wales and its general and ancillary powers.

Welsh Ministers’ accountability

Accountable for overall performance of Tribunals Wales.

Statutory provision: Government policy

A duty on Tribunals Wales in the exercise of its functions to have regard to such aspects of Welsh Government policy and such other matters as the Welsh Ministers may direct.

Welsh Ministers’ accountability

Day-to-day administration will not sit with ministers. This is not a power for the Welsh Ministers to give Tribunals Wales specific directions as to the exercise of its functions.

Statutory provision: Advice to the Welsh Ministers

Duty to provide advice and assistance to the Welsh Ministers as requested; power to offer advice on policy relation to matters where Tribunals Wales exercises functions or the administration of justice in Wales.

Welsh Ministers’ accountability

Mechanism for Welsh Ministers to draw on relevant expertise of Tribunals Wales and for it to be able to offer advice to ministers framed by its functions.

Statutory provision: Default power

Power for the Welsh Ministers by regulations to assume responsibility for the functions of Tribunals Wales where ministers consider the body is failing to carry out its functions to deliver its purpose or is doing so in such a way so as to create a significant risk to the functioning of the tribunal system.

Welsh Ministers’ accountability

Equivalent to section 70 of the Judiciary and Courts (Scotland) Act 2008.

Board

Statutory provision: Chairperson

Chairperson appointed by the Welsh Ministers, or President of Welsh Tribunals ex officio.

Welsh Ministers’ accountability

Welsh Ministers’ role in appointing chair if the President of Welsh Tribunals ex officio does not hold the chair.

Statutory provision: Members

Judicial members

President of Welsh Tribunals ex officio (if not Chairperson); one judicial member of the new tribunal system for Wales selected by the President.

Non-judicial members

Not fewer than 3 nor more than 6 persons appointed by the Welsh Ministers.

Executive members

CEO ex officio; one other member of staff appointed by the CEO.

(This gives a board of between 8 and 11 persons).

Welsh Ministers’ accountability

Welsh Ministers to be under a "have regard to" duty to ensure appointees have experience of matters relevant to the Tribunals Wales’ purpose and functions and to secure a variety of skills and experience among the members (e.g. a person representative of tribunal users, or a solicitor or barrister with experience of devolved tribunals).

Tribunals Wales to be a regulated body with appointments to it regulated by the Commissioner for Public Appointments.

Statutory provision: Tenure (except PWT governed by separate legislation)

4 years. Eligible for reappointment. Provision for resignations and removals also required.

Welsh Ministers’ accountability

Ensure appointments meet Code of Practice, including any restrictions on reappointments.

Statutory provision: Remuneration

Power for Tribunals Wales to pay remuneration and expenses to members of the board and any co-opted members of committees.

Welsh Ministers’ accountability

Welsh Ministers allocate finance through annual grant-in-aid of such amount ministers consider appropriate for Tribunals Wales to carry out its functions.

Statutory provision: Committees

Power for Tribunals Wales to establish committees and co-opt persons to sit on them.

Statutory provision: Proceedings

Power for Tribunals Wales to regulate its proceedings, quorum (including committees), manner of voting, etc.

Statutory provision: Delegation

Power for Tribunals Wales to delegate any function to a member, committee, employee or any other person, corporation or statutory entity, but not to divest itself of responsibility for the function delegated.

Staff

Statutory provision: CEO

First CEO to be appointed by Welsh Ministers on the T&Cs they determine appropriate.

Subsequent CEOs to be appointed by the Board of Tribunals Wales on T&Cs it, with the approval of the Welsh Ministers, determines appropriate.

Welsh Ministers’ accountability

Welsh Ministers make first appointment of CEO and required to approve T&Cs of that and subsequent appointees.

Statutory provision: Other staff

Tribunals Wales can appoint staff as it considers appropriate to enable it to discharge its functions. If an NMD, this will be subject to the Civil Service Commission Recruitment Principles.

Welsh Ministers’ accountability

Welsh Ministers allocate finance through annual grant-in-aid of such amount ministers consider appropriate for the Tribunals Wales to carry out its functions. Ensure that CEO and Board are recruited under Code of Practice.

Finance

Statutory provision: Funding

Sources of funding for Tribunals Wales: income from fees; and grant-in-aid from Welsh Ministers of such amount ministers consider appropriate for the body to carry out its functions and subject to conditions ministers consider appropriate.

Welsh Ministers’ accountability

Welsh Ministers accountability underpinned by a framework document/interdepartmental agreement setting out the Welsh Government's budget planning processes, governed by the Government of Wales Act 2006 and Senedd Cymru Standing Orders. Decision on budget allocation to sit with ministers.

Tribunals Wales to co-operate with ministers by providing all necessary assistance, information and budget forecasts to inform Government budget planning decisions.

Budget allocations for the year ensuing to be confirmed in an annual remit letter.

Statutory provision: Accounting Officer

CEO to be the Accounting Officer of Tribunals Wales with responsibility for deployment of resources in line with conditions of funding specified by the Welsh Ministers, signing the annual report and accounts and so forth.

Welsh Ministers’ accountability

Framework document/interdepartmental agreement to set out the roles and responsibilities of the CEO as Accounting Officer and the Permanent Secretary as Principal Accounting Officer for the Welsh Ministers.

Statutory provision: Audit

External auditor to be the Auditor General for Wales, with power to examine the economy, efficiency and effectiveness of the use of resources but not to question the merits of the objectives of Tribunals Wales.

Welsh Ministers’ accountability

Framework document/interdepartmental agreement to set out detail on matters in relation to internal audit and external audit.

Corporate governance

Statutory provision: Corporate plan

Tribunals Wales to prepare a corporate plan for a defined period to be approved by the Welsh Ministers which the body must then publish and lay before the Senedd. It must set out the body's strategic objectives for the planning period and the performance measures by which achievement of the objectives can be measured.

Welsh Ministers’ accountability

Framework document/interdepartmental agreement to set out the corporate governance planning framework: Term of Government remit letter (subject to process for modification if government priorities shift); corporate plan for a defined period; annual business plan; accounts and annual report.

The planning period the corporate plan must cover could be prescribed in primary legislation (e.g. periods of 3 years commencing on a certain date) or in subordinate legislation with a power for the Welsh Ministers to amend the period as they consider appropriate.

Statutory provision: Accounts and annual report

Tribunals Wales to keep proper accounting records and prepare an annual statement of accounts in accordance with any directions given by the Welsh Ministers.

Welsh Ministers’ accountability

Framework document/interdepartmental agreement to set out detail on the statutory accounting and reporting requirements.

Statutory provision: Accounts and annual report

Tribunals Wales to keep proper accounting records and prepare an annual statement of accounts in accordance with any directions given by the Welsh Ministers.

Welsh Ministers’ accountability

Framework document/interdepartmental agreement to set out detail on the statutory accounting and reporting requirements.

Statutory provision: Provision of information

Tribunals Wales to provide the Welsh Ministers with any information they require relating to the exercise of the body’s functions, subject to the confidentiality of information relating to applications to the tribunals.

Welsh Ministers’ accountability

Framework document/interdepartmental agreement to set out detail on Welsh Ministers access to information held by Tribunals Wales.

Transfer of staff

Statutory provision: Transfer scheme for staff

Power for the Welsh Ministers by regulations to provide for the transfer of staff employed by them to be transferred to Tribunals Wales.

Power for the Welsh Ministers to second staff to Tribunals Wales.

Welsh Ministers’ accountability

Welsh Ministers accountable for the initial staffing of Tribunals Wales.

Transfer of property and liabilities

Statutory provision: Transfer scheme for property and liabilities

Power for the Welsh Ministers by regulations to provide for the transfer of any property and liabilities to Tribunals Wales.

Welsh Ministers’ accountability

Welsh Ministers accountable for the initial property and liabilities of Tribunals Wales.

Consequential matters

Statutory provision: Amendments to legislation

Tribunals Wales to be included in relevant schedules as a public body, including, e.g.:

• The Freedom of Information Act 2000
• The Well-being of Future Generations Act 2015, and
• The Public Services Ombudsman (Wales) Act 2019.

Table 1: Tribiwnlysoedd Cymru / Tribunals Wales, a proposed arms-length body corporate: proposed structure and governance