20 July 2023 — Minutes of the meeting of the Board of Commissioners

Minutes of the meeting of the Board, Thursday 20 July 2023.

Location: Remote Meeting via Microsoft Teams

Commissioners:

• Marcus Boyle (Chair) (MB)
• John Baillie (JB)
• Carol Brady (CB)
• Stephen Cohen (SC)
• Trevor Pearce (TP)
• David Rossington (DR)
• Catharine Seddon (CS)

Executive Team:

• Andrew Rhodes (AR)
• Sarah Gardner (SG)
• Helen Child (HC)
• Lucy Denton (LD)
• Helen Gibson (HG)
• Tim Miller (TM)
• Nadine Pemberton Jn Baptiste (NPJB)
• Alistair Quigley (AQ)
• John Tanner (JT)

Other participants:

• REDACTED (notes)
• REDACTED
• REDACTED (item 8)
• REDACTED (item 5)
• REDACTED (item 7)

Observers:

• REDACTED
• REDACTED
• REDACTED

Apologies:

• Kay Roberts

1. Welcome, apologies and declarations of interest

The Chair welcomed all attendees. Apologies were received from Kay Roberts.

CS noted two new declarations of interest:

• appointment to the Disciplinary Committee of the Royal College of Veterinary Surgeons
• Institute Director of the Chartered Insurance Institute and appointment the Chartered Insurance Institute (CII) Personal Finance Society Board.

The Chair advised that he had been appointed to the Cabinet Office as a Non-Executive Director.

The Chair advised that AR had been appointed as a Commissioner with effect from 4 July 2023.

2. Minutes, Actions and Forward Look

The minutes of the meeting held on 8 June 2023 were agreed as a true record.

The minutes of the extraordinary meeting held on 27 June 2023 were agreed as a true record.

The minutes of the extraordinary meeting held on 7 July 2023 were agreed as a true record.

The actions log, forward look and the Board Effectiveness Review (BER) action plan were noted.

HC noted that she has been asked to supply routine updates on the BER action plan to the Department for Culture, Media and Sport (DCMS).

(REDACTED)

Progress is being made in most areas with plans for further Board development in September and the induction of new Commissioners.

3. Chair’s Report

On Strategy, the Chair reflected the coming opportunity to bring together the developments of the last two years in the new corporate strategy. The Chair encouraged Commissioners to get involved in the development work.

(REDACTED)

On induction, the Chair noted that the Governance Team have created a comprehensive induction programme. HC advised that the programme will be tested with the new Commissioners, but the development is a step change from the work we have done previously to induct new Commissioners and Advisory Group members. The Chair congratulated Helen, (REDACTED), (REDACTED) and the team for their work.

(REDACTED)

The second Non-Executive Director (NED) workshop was held this week and the Chair reflected that the Commission’s increased engagement with industry is recognised and is paying dividends.

(REDACTED)

4. Chief Executive Officer’s Report

AR introduced the Chief Executive Officer (CEO) report. (REDACTED). He also noted that Allwyn had appointed a new CEO.

(REDACTED)

On performance, AR noted important steps forward and the strength of the financial position. The accuracy of forecasting and budgeting work is very good.

The Select Committee has held three hearings so far with little mention of the Gambling Commission – one issue that Andrew has noted is misuse of data. AR, SG and TM are due to attend on 5 September 2023 with the Minster and Ben Dean due to appear immediately afterwards. To date the Committee has focused on the White Paper and resources for implementation.

(REDACTED)

The Pulse Survey results are in with the engagement score at 67 percent - a 21 percent increase in the last two years, and a 13 percent increase over the last year. AR was very pleased with the outcomes and has scanned the comments. There are positive comments on visibility of Executive and Board as well as on clarity of direction. AR only noted one comment on pay on this occasion.

Catharine welcomed the Pulse Survey results and the work done to transform corporate culture. (REDACTED)

(REDACTED)

DR raised three points:

• increased engagement – very welcome and a necessary condition for being a productive and efficient
• forecasts – incredibly important that the Commission sticks to forecast and Executive focus on this will be really helpful
• Annual Report and Accounts (ARA) – AR confirmed that the ARA will be laid in Parliament today and the letter of representation was signed yesterday.

The Chair noted the strong progress made across a number of areas of work and congratulated AR on great performance.

5. Corporate Strategy Development – Verbal Update

SG and the Director of Strategy (REDACTED) presented a verbal update on the development of the Corporate Strategy.

Work done to date, including on the sprints, will contribute to the development. At this point Board are not being asked to give their views on particular elements of the work. The Chair and AR have been closely engaged in the work, along with a range of internal and external stakeholders. SG noted the different moving parts in place reflecting the workstreams on Ops Transformation, Data Transformation and the Gambling Act Review (GAR).

SG noted that the output for Board in September will be informed by a rich evidence base. A lot of thought has been given to how best to engage with Board by providing an outline with some key elements and structure for discussion.

(REDACTED) The Director of Strategy shared some of the emerging thinking, noting that there is a great deal of raw material to work through with the support of an internal working group. (REDACTED) The Director of Strategy noted the following points:

• clarity on strategic regulatory outcomes which will be central to an improved performance framework
• Gambling Act Review (GAR) and Fourth National Lottery (4NL) undertakings
• beyond changes to the Licensing Codes and Conditions of Practice (LCCP), the GAR work will cover the approach to a levy and the approach to an Ombudsman which are key in term of strategic impact
• opportunity to revisit how we communicate our rulebooks and considering clarity. LCCP will be 20 years old by the end of this work so there is a presentational issue to be considered
• the next decade of regulation – reviewing and changing our assurance model (taking into account Ops Transformation elements), Data (incorporating the work with Digital Advisory Panel (DAP) and (REDACTED)) and upgrading our tech. core systems and related processes.

(REDACTED)

6. Fourth National Lottery Licence (4NL) Verbal Update

The Chair noted that he had asked JT to focus his comments on implementation.

JT provided a verbal update to Board on the Fourth National Lottery Licence.

(REDACTED)

7. Gambling Act Review (GAR) Update

(REDACTED) The Director of Policy and Senior Policy Manager (REDACTED) joined the meeting to present the paper. (REDACTED) The Insight Lottery Policy Specialist and the Programme Manager (REDACTED) joined to observe for this item.

Board were asked to:

a) note the progress on Gambling Act Review (GAR) implementation

b) provide a decision in respect of updating business plan content connected with GAR implementation, including delegation to the relevant Executive on detailed content and timing of publication

c) (REDACTED)

(REDACTED)

TM has advised that the Commission consultations will be published by 9am on Wednesday 26 July and paid tribute to the team who have worked to get consultations ready in a short timescale.

TM explained that the consultations cover remote game design, restrictions on cross selling, changes to protections for young people, especially age verification, and financial risk checks. There are also two non-GAR elements on Personal Management Licence (PML) requirements and regulatory panels. The GAR team have had their first meeting with the Audit and Risk Committee (ARC) as part of their oversight of the work.

TM outlined the need to update the Business Plan now that the White Paper has been published and asked Board to agree the approach proposed to update the information in the Business Plan. Board agreed the recommendation.

(REDACTED)

TM noted that GAR implementation work is on track. On previous consultations (suicide reporting, extension to GamStop for telephone betting and a technical change to payment provision) responses are being reviewed for publication in September 2023, and the response has been delegated to Tim to sign off. Tim indicated that there are no significant changes highlighted in the responses received.

The Chair reiterated his thanks to the team and endorsed the position taken in respect of the consultation publications.

8. Finance

Financial Report May 2023

HG introduced the report and thanked the Audit and Risk Committee for their work on reviewing and approving the Annual Reports and Accounts (ARA).

(REDACTED) The Senior Finance Business Partner introduced the May 2023 financial position paper, noting that the June report will be presented to the Executive Team next week. The surplus has reduced, mainly as a result of the cost of living payment. The underspend noted is mainly attributed to the reprofiling of research spend. Staffing and vacancies are being reviewed with the Executive Team and (REDACTED) noted that the budget did not include the impact of GAR implementation.

(REDACTED) explained that the number of vacancies as at June 2023 is 48. HG noted that the number includes various new posts, and that redeployment work from the Third National Lottery (3NL) and Fourth National Lottery (4NL) teams has been very successful in filling vacancies internally although there is work needed on timing. (REDACTED) referred to slide 17 which shows the forecast numbers of Full Time Equivalent (FTE) across the months.

DR suggested that a different way of presenting vacancy data might be useful for Board – for example, a number of vacancies at month end, how many are new and how many vacancies have been filled in that month to give a sense of the change over time. On the basis of these figures the Commission is in a better position on forecasting but there is a need to ensure that reprofiled spend remains in year.

Action: (REDACTED) to develop forecast reporting for internal vacancies.

The Chair asked about forecasting accuracy and what number the Board should be looking at. Helen Gibson explained that she is considering variance against income and expenditure budgets – in particular expenditure which is currently around 2 percent. The overall budget positions will be reviewed mid-year in line with the supplementary estimate process. DR advised that approach is entirely standard across government finance.

HG and HC confirmed they were working on better synchronisation of reporting and meeting frequency to ensure Board see the most current information.

Legal Costs Review

NPJB and the Head of Legal (REDACTED) introduced the item, noting that the paper covers legal costs across the Commission. NPJB noted that an overall spend for Fourth National Lottery (4NL) is not covered in the paper, and this will be acquired for a post competition report. The internal legal team is relatively small with 10 staff including a Personal Assistant (PA) and a Paralegal.

(REDACTED)

The Chair noted the assurance taken from the presentation of the paper to Board.

9. Risk Review

HC introduced the item, noting that responsibility for risk management has moved to the Governance Team.

(REDACTED) The Senior Manager, Governance and Risk Assurance, presented the item, noting that the Audit and Risk Committee also received a detailed update this month. Two new posts have been created to build capacity for risk management – a Risk Manager and a Risk Analyst have been appointed through the redeployment process and transition is being negotiated. The Risk Manager role will be matrix managed with the Gambling Act Review (GAR) Team.

(REDACTED)

10. Committee Updates and Annual Reports to Board

Audit and Risk Committee Annual Report to Board

JB noted that the auditors signed off the Annual Reports and Accounts (ARA) on the basis of an unqualified opinion. JB noted that by September 2023 most of the outstanding internal audit recommendations will be completed. HC noted that the Government Internal Audit Agency (GIAA) track progress through the year, taking a risk-based approach to evidence collection. GIAA do not seek evidence on or track progress on advisory reviews, but the Commission does. The relatively low number of high impacts, high risk findings is positive. Each review sets a deadline for the completion of recommendations so there will always be items to be monitored.

JB offered his thanks to the Finance Team for their efforts in getting the Annual Reports and Accounts completed for 2022 to 2023. The Chair agreed.

National Lottery Committee

The Board received the papers and raised no questions.

Assurance Report

The Board received the papers and raised no questions.

Annual Report to Board

The Board received the papers and raised no questions.

Remuneration and Nominations Committee

The Board received the papers and raised no questions.

Annual Review of the Remuneration and Nominations Committee 2022 to 2023

TP noted that the July meeting covered CEO and Executive Team performance and pay, pay remit, committee effectiveness and commissioner appraisals.

11. (REDACTED)

(REDACTED)

12. Any Other Business

HC noted that an invite has been extended to Commissioners to the Colleague Conference on 13 September and advised that DR and SC will be attending. If anyone would like to attend, please let HC know.

13. Private Session for Commissioners and CEO

The private session was not minuted.

Date of the Next Board Meeting: 28 September 2023.