Public audit in Scotland: What’s on the horizon?

We are living in incredibly busy times for the public sector in Scotland, with each passing week bringing a new political announcement or debate. With so much going on, it can be hard to think beyond the next few months.

I’ve often heard it said that audit is retrospective in nature, but in fact we spend a lot of time and energy looking ahead to understand what’s on the horizon, what it means for our future work, and what impact we want to have. And we need to make sure that our plans reflect the priorities and concerns of the public and our key stakeholders, whichever policy area we’re focused on.

Our new approach uses these principles to create a rolling five-year programme of audits, which we refresh each year. The results of our latest review are now available on our website, setting out in detail what areas of public spending and policy we plan to report on between now and 2021/22.

The programme covers all of the work that Audit Scotland will carry out over the next five years on behalf of me and my colleagues in the Accounts Commission, the local government watchdog. It’s based on consultation with a range of stakeholders; for example, as Auditor General I report to the Parliament’s Public Audit & Post-legislative Scrutiny Committee and we consulted with committee members to see how the audit risks we’d identified through our work matched what they want to see from public audit in the coming years.

As well as the audits of specific policy developments across the public sector, I’d like to highlight a couple of areas that will inevitably affect much of the public sector, and all of us who use public services in Scotland, in the long-term.

First off are the historic changes taking place in Scotland’s public finances, with new financial powers coming on stream through the Scotland Acts 2012 and 2016. We reported our latest update to MSPs last month and will continue to report on this annually. This commitment reflects the scale of the work that will be required of the Scottish Government and others to successfully implement and manage the new powers.

We’ll also continue to expand our high-profile work on Scotland’s NHS, with audits of the NHS workforce, children’s mental health services, and health and social care integration all in the pipeline.

And there’s lot more, right across the public sector, from ferry services and widening access, higher education to fire reform, digital to community justice. We’ll also continue to explore different ways of making our work accessible to everyone with an interest, building on the range of ways we already report our work.

If you’d like to know more, you can find out who to contact here.

About the author

MM6A8690croppedCaroline Gardner is the Auditor General, and Accountable Officer for Audit Scotland. She started her term in July 2012, and has more than 30 years’ experience in audit, governance and financial management. Follow her on twitter @AuditorGenScot

 

Reflecting on the Accounts Commission’s refreshed work programme

With council elections in Scotland having taken place last week, this seems an appropriate time for the Accounts Commission to set out its plans and work programme for the next five years.

As the weeks of campaigning by political parties and candidates drew to a close last week, newly elected local councils across Scotland are now preparing for the major challenges they face in delivering on their policies and priorities, with less money available  from the public purse.

As the independent watchdog for local government in Scotland, the Accounts Commission plays a prime role in holding councils to account for the money they spend and helping them improve their vital services to the public. Therefore, our strategy and our work programme reflect the complex financial environment which councils operate in, new approaches to service delivery and national policy developments that have a major impact on the operations of local government.

Together with the Auditor General, we’ve adopted a new approach to our future work programme, to be taken forward by Audit Scotland. The programme is planned over a five year-period and updated annually to ensure that our strategic priorities are aligned with key changes in our environment.

As Acting Chair of the Commission, it is important to me that we continue to ensure that we are as effective as possible, that we respond constructively to feedback  from our stakeholders and that we continually ask ourselves how we can  maximise our impact  in this crucial time for Scottish public services.

So what’s to come in the next five years?

Central to our future work is a refreshed approach to Best Value audits of councils, and we’ll report on six or seven individual local authorities each year. These reports provide valuable information and insight for councillors, officers and local residents on the performance of their local authority, and how councils are  dealing their with financial challenges and growing pressures on services – a situation that applies to every council in Scotland.

Our new approach re-emphasises the importance of continuous improvement in councils, and we want to see auditors focus and make judgements on the quality of services and positive outcomes for local people and communities. The first batch of audits is already underway.

As well as reviewing the performance of individual councils, we’ll continue to provide our annual review of the local government sector as a whole. In 2016/17 we piloted a new two-part approach to this audit, publishing separate reports on the sector’s financial health, and its service performance. The feedback from councils and other stakeholders was positive and we plan to continue this approach in future.

There’s also a key role for the Commission in reviewing, commenting on and informing how national policy developments are impacting on service design and delivery within councils. As such, we’ve a number of audits planned in this area, from early learning and childcare, to employability and community justice. In some areas, we’ll work closely with the Auditor General, to provide a dual perspective on how policies are being implemented at both a national and local level.

If you’re interested in our work, it’s worth keeping an eye out for a few important announcements in the next few weeks – we’ll publish our annual report for 2016/17 as well as our refreshed strategy and engagement plan. They’ll be available on our website, and we’ll be working hard to communicate these and engage with newly elected members and officers as they adjust to a new chapter in their respective councils.

About the author

Ronnie Hinds is Acting Chair of the Accounts Commission and a former chief executive of Fife Council. He also chairs the Local Government Boundary Commission for Scotland.

Auditing historic change in Scotland’s public finances

On 1st April, the Scottish Parliament gained control of income tax rates and bands, higher borrowing limits, and the management of the Crown Estate in Scotland – and there are more new powers to come.

The Scotland Act 2016 is fundamentally changing management of the public finances and, once fully implemented, half of what is spent in Scotland will be raised here and the budget will be subject to greater uncertainty and volatility than ever before. With more control over public finances and new opportunities and risks, it’s clear that we’re entering new territory.

The scale of change needed to implement and manage the new financial powers is significant and it’s important that the Parliament and the public can see what progress is being made. As the public spending watchdog, Audit Scotland has carried out extensive work in this area.

On Thursday, I’ll join the Auditor General, Caroline Gardner, and colleagues to present the findings of our latest report on managing new financial powers to Holyrood’s Public Audit and Post-legislative Scrutiny Committee. We looked at how the Scottish Government, Revenue Scotland and the Scottish Fiscal Commission are introducing and managing the range of powers devolved through the 2012 and 2016 Scotland Acts.

We found that the Scottish Government is well-organised to deliver new tax and spending powers. It has updated its structures for overseeing the new powers and has good programme management processes in place. Revenue Scotland is also making good progress in preparing for further devolved taxes, and the transition of the Scottish Fiscal Commission to a statutory body is being managed effectively.

The new powers will substantially change the type and volume of work the Scottish Government will do. We found that the Scottish Government is identifying the staff and skills it needs, but recruiting enough people with the required skills may prove difficult. We recommend that the Scottish Government build a clearer picture of potential future costs, to help plan how it will fund implementation of the new powers within its budget.

In this changing environment, a more strategic approach to public financial management and reporting is needed. This includes a medium-term financial strategy based on clear policies and principles. The Scottish Government is taking steps to provide a more comprehensive picture of the public finances, as it’s important that the Parliament and public have the information they need to understand and scrutinise the government’s financial decisions.

MSPs will have the chance to discuss these findings in detail with us this week, and the session can be watched live on Parliament TV.

We’ll continue to report on the progress of public bodies in implementing and managing the new financial powers. If you’re interested in our work in this area, our new e-hub on financial devolution has a range of reports, exhibits, briefings and other useful tools.

About the author

MarkTaylorMark Taylor is an Assistant Director in Audit Scotland. He is responsible for overseeing Audit Scotland’s work relating to financial devolution and constitutional change.