Learning lessons from young people

Audit Scotland and Young Scot have been working with a group of young people over the past few weeks on CheckSee. This has been something completely different for Audit Scotland, working with young people to think about how we do our audits and the topics we look at.

The pilot was a great success and we’re very grateful to all the young people who took part. At the final session the group shared their thoughts and insights about what they see as being the big issues relating to education, skills and employability, and also their recommendations. There was a great buzz in the room, with loads of enthusiasm, and it was fantastic to see things from their point of view. They came up with some great ideas.


The group also gave us a strong, good challenge about what we need to be doing better ourselves – like thinking about other ways of getting our messages across, rather than long written reports. The group had some really good suggestions and they were very honest in their assessment of our current reports! That’s exactly what we need to hear so we can improve.

We’re thinking about the next steps now, and we’d love to keep working with some of the group. Young Scot will be sharing their learning from the project in due course, and I’m looking forward to hearing what the young people who took part in the sessions thought of CheckSee.

At Audit Scotland, we got such a lot out of the session, and people were really fired up afterwards. As things move on, we’ll share more information about what we’re doing and what’s changed as a result of working with the young people. This is the start of an exciting new phase for us.

MM6A6140About the author

Tricia Meldrum is a Senior Manager with Audit Scotland’s Performance Audit & Best Value group. She joined Audit Scotland is 2001 with a background in health economics, and currently oversees audits in the education and children’s services sectors.


What could Brexit mean for Scotland’s public finances?

I’ll remember the morning of 24 June for a long time. Whatever your views and vote in the EU referendum, it was clear something momentous had taken place. Certainties were swept away and now, nobody really knows what comes next.

And the vote came at a time when Scotland’s public sector was already dealing with significant change, including new financial powers, building pressure on the public purse and service reform. Add into the mix a new Scottish Parliament, a return to minority government and renewed debate about the possibility of a second independence referendum, and you have a future that’s far from fixed, and filled with both opportunities and risks.

The key question on everyone’s mind in the wake of the Brexit vote is what will it mean: for the country, for our politics, for me?

Of course, we don’t really know yet, but we can begin thinking through the implications and start exploring what it might mean for Scottish public finances.

Even with the devolution of further tax powers, the Scottish Government’s overall budget will continue to be linked to UK public spending decisions, and the state of the economy.

Following the EU referendum vote, the UK Government has set aside its deficit targets and Chancellor Philip Hammond has indicated scope for a ‘fiscal reset’ in the Autumn Statement, depending on early signs about economic performance.

And for its part the Scottish Government is proposing to delay the Scottish budget until it knows more, and has decided not to hold a three-year spending review at this point.

For now, all bets are off as to how things will pan out and how this will ultimately impact on Scotland’s public finances.

We know that European funding it is highly focused on a few areas in Scotland – agriculture, economic development and skills, fisheries and research. However, it’s hard for people and organisations to commit time and resources to planning if they don’t know which future is more likely to occur. The Chancellor has recently guaranteed that funding will be in place for projects established before the autumn statement but not everything is covered.

And there are other areas affected by EU rules to consider, such as procurement, environmental rules, entitlement to public services (for example, university tuition fees) and social security payments.

So a lot of questions and, at this stage, not many answers.

In Audit Scotland, we’ve extended the scope of our work on new financial powers to consider the implications of the EU referendum result. This brings together known and prospective constitutional changes affecting public finances, and will help us to identify the audit risks that we need to address in our work.

Key issues that we will need to consider are likely to include potential challenges to financial sustainability for public bodies exposed significantly to the end of EU funding streams, and the effectiveness of policy implementation in any areas that are transferred from EU to Scottish Government control and links to overall objectives, outcomes and performance

And of course, while the final destination isn’t yet known, further devolution in Scotland continues apace and the Scottish Parliament is receiving substantial new financial powers via the Scotland Act 2016. Whatever happens as a result of the EU referendum vote, these new powers need to be managed and integrated into the Parliament’s scrutiny processes and there is definitely a role for Audit Scotland to play. We’ve committed to supporting the Parliament to develop world-class arrangements for holding government to account and improving the use of public money.

We will therefore continue to work with its committees to strengthen the Parliament’s oversight, in line with the recommendation of the Smith Commission, and to support scrutiny of the implementation of the new powers.

If you’re interested in this area of our work, keep an eye on our New Financial Powers webpage for more updates.

About the author

MarkTaylorMark Taylor is an Assistant Director in Audit Scotland. He oversees a wide portfolio of central government audits, including the Scottish Government audit, and is the lead on our work on new financial powers and constitutional change.

What is an ALEO – and does it matter?

In June, Douglas Sinclair, Chair of the Accounts Commission, and I were asked to present at Holyrood Events’ Making the most of arms-length external organisations.

Arms-length bodies feature across the public sector. We’ve heard about non-departmental public bodies, executive agencies and so on. They provide public services but are somehow one step removed, or arms-length, from government – a bit like Audit Scotland!

ALEOs can be thought of as councils’ version of these bodies. As Douglas outlined, there has been steady growth in their use. First seen as sports trusts in the 1980s, ALEOs are now widely used for property, transport, economic development, and more recently, care services. You may be surprised to know there are around 130 ALEOs in Scotland, with a turnover of £1.3 billion, employing over 28,000 people.

It’s fair to say that the public can be wary of such bodies. The term ‘quango’ is often used in a less than complimentary way – not to mention ‘bonfire’. So what is an ALEO? There is no legal definition. They are separate from the council but subject to its control or influence. They take many forms including companies, charities, and community enterprises.

And why do councils use them? A common reason is to save money. About one-third of ALEOs have charitable status and this attracts business rates relief. They can generate income through selling services more widely, and it is argued their independence helps them really focus on the business at hand and be more responsive to customers.

I mentioned accountability as a concern. This is a factor councils should consider carefully. When used well, ALEOs can help to put the spotlight on the service – with the ALEO board, council committee, and importantly, service users, providing oversight. But there have been cases where ALEOs have gone wrong, putting services and public money at risk – Caithness Heat and Power, and Strathclyde Passenger Transport Authority being past examples the Accounts Commission has reported on.

Councils must of course put safeguards in place. The Accounts Commission and COSLA’s Following the Public Pound Code expects councils to spend public money wisely and be clear what is delivered in return. The Code applies regardless of how our money is spent – be it through partnerships, contracts or outside bodies such as ALEOs. And we have an important role to assure the public that councils follow the Code’s broad principles. So perhaps the exact definition of an ALEO is not so important after all.

The Accounts Commission has a strong and continuing interest in ALEOs. It plans to build on the work it has already done through the Following the Public Pound Code and its How Councils Work series of reports. From October, annual audit work in councils will become more integrated with the audit of Best Value, including a focus on councils’ compliance to the Code and their use of ALEOs.

Peter-Worsdale_CROPPEDAbout the author

Peter Worsdale is an Audit Manager within Audit Scotland’s Performance Audit & Best Value (PABV) group. He joined the organisation in 2004.


CheckSee with Young Scot – a new approach to public engagement

Audit Scotland is keen to do more to engage, in different ways, with people who use the public services we audit. We’re also looking to engage with people much earlier, before we even begin planning audits, so that we can learn from their experiences. This will help shape our audit work.

We’re kicking off something new this week, working with Young Scot. Young Scot is the national youth information and citizenship charity that does lots of different work with people aged 11-25. There’s loads of information about them and what they do on their website.

The Young Scot Co-design team is working with us on a new project called CheckSee. One of the aims of CheckSee is to help us identify the main issues that young people think are important to them, in particular relating to education, skills and employability. The other aim is to help us understand how we can engage more with young people as we develop and carry out audits.

For the young people involved, this is an opportunity to help shape our work in these really important areas. It will also help them develop their confidence in communicating their experiences, views and ideas.

CheckSee involves a group of 15 people aged 15-20. The group will get together four times over the next six weeks. I’m looking forward to going along to some of the sessions, along with colleagues. The first session is a getting to know each other ‘pizza and patter session’. There’s one great idea for a new approach to our team meetings already! We’re particularly looking forward to the young people coming into our office here in Edinburgh for the final session. This will be an opportunity for the group to meet more of our staff and ask us questions. The group will then share their thinking with us. I’m sure this will be a lively and really informative session.

We’ll be using what comes out of the sessions to help us think about, and shape, the areas we audit. We’ll also be really interested to hear the group’s thoughts on how people who use the services we’re looking at could be more involved in the audits. This is something we’ll take forward as we start planning new audits. Hopefully some of the members of the group will be keen to keep working with us after the pilot finishes, to keep up that momentum.

We’ll be tweeting from the sessions, sharing the sessions via Periscope and asking some of those involved to publish blogs about how the pilot is going, so watch this space for updates and follow the #CheckSee hashtag.

About the author 

MM6A6140Tricia Meldrum is a Senior Manager with Audit Scotland’s Performance Audit & Best Value group. She joined Audit Scotland is 2001 with a background in health economics, and currently oversees audits in the education and children’s services sectors.

New Parliament, new powers, new opportunities

A lot has happened since my last blog, and it’s fair to say that Scotland’s new financial powers won’t have been top of the list of political developments for many of us over the last few days. Yet however events unfold in the months to come, the state of the country’s public finances is likely to be even more important, and the need for effective scrutiny even greater.

The new session of the Scottish Parliament delivers a new opportunity to focus on scrutiny and improvement of public services, as well as new faces and new priorities. The biggest change for me as Auditor General is working with a new Public Audit Committee (PAC). The committee’s membership is smaller this time around, down from nine MSPs to seven, but it’s great to see that the gender balance of the group is even, with four female MSPs on board, including the new convener and deputy convener.

The PAC will also have a wider remit in this session, with the addition of post-legislative scrutiny to its responsibilities. It’ll be interesting to see how that new role develops in the future, and to explore how our audit work can support the committee in this area.

I’ll report to the new PAC for the first time tomorrow, starting with a briefing for members on my latest update on the Scottish Government’s Common Agricultural Policy Futures Programme. I highlighted a number of concerns with the management and delivery of the programme, particularly with the IT project designed to process funding applications from Scotland’s farmers and rural businesses. Challenges remain with the project as it continues to work towards key deadlines and we’re monitoring progress, and the impact on the Scottish budget, through our annual audit of the Scottish Government’s accounts.

I’ll then give evidence on my March report on Changing Models of Health and Social Care. This report highlighted the growing need for Scotland’s health and social care services to create new ways of working, and adapt to increasing pressures. Stronger leadership is needed to achieve this, underpinned by clear, long-term planning by the Scottish Government. Health and social services are used by all of us at some point in our lives, and I expect that the committee will be keen to spend some time exploring the issues raised in my report.

At the core of both of these reports is the implementation of reforms in the public sector. As we highlighted in Audit Scotland’s 2015/16 annual report, tracking the impact of reform across public services has been a key focus of our audit work in recent years, from looking at college mergers, to examining the creation of a single police service for Scotland.

And there’s more to come, with the new financial powers for the Scottish Parliament set to have a considerable impact on how public money is managed and spent. Audit Scotland has already produced in-depth reviews of the implementation of devolved taxes delivered under the Scotland Act 2012, and we’re currently planning our next report on managing the new powers.

It’s essential that the Parliament and the public have the information they need to understand the big choices and challenges underway in public services, so Audit Scotland has committed to making our work as transparent as possible. If you’d like to know more about how we contribute to the Parliament, you can tune in and watch the PAC session live from 9am.

About the author

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


Exploring early learning and childcare: Have your say

Audit Scotland looks at public spending and policy across the whole of the public sector, meaning there’s a huge number of areas we can potentially explore.

Right now we’re considering an audit on Early Learning and Childcare (ELCC) in Scotland. These services have recently been changed and face further reform in the future, so this feels like the right time to take a closer look at how the system is working, and what outcomes are being delivered for the people who access this support.

We haven’t explored these services in detail before, and we want to make sure we’re on the right track when we start planning our audit work. So, we’re looking for parents and carers of children eligible for funded early learning and childcare services (usually three to four-year-olds, and some two-year-olds) to share their views and experiences with us, in a brief new survey.

We’re particularly interested in exploring how public money is spent on ELCC, and what the impact has been on children, and their parents and carers, from the recent changes to the system.

Icon_A_B_AS-04These changes include:

  • An increase in the number of funded hours available for three and four year olds from 475 to 600 hours a year;
  • Provision of funded places for some two year olds;
  • An increase in the flexibility of the services, such as offering places with different hours or in different settings, dependent on local need

These are the areas we’re primarily interested in, but we also want parents and carers to let us know if there are other aspects of ELCC they think we should look at when we begin our work.

By telling us about their experiences and what areas they think we should be focusing on, they can play an important role in helping to make sure public money is spent properly, and creates positive outcomes for the people who rely on vital services like ELCC.

So if you’re a parent or carer of an eligible child (or children!), please spare a few minutes to help us build a picture of what’s happening across the country, what’s important to you and your family, and the kinds of issues we should cover in our work.

We’ll run the survey until the end of August and post further updates here and on our website as our audit starts to take shape. Why not sign up to our newsletter when you complete the survey, so we can send updates straight to your inbox?

About the author

MM6A5569Rebecca Smallwood is an auditor and joined Audit Scotland in 2008. She has worked on a number of audits with a health and social care focus, including community health partnerships, emergency departments and reshaping care for older people.

A stronger new code for auditors

Our new Code of Audit Practice marks an exciting step change in the responsibilities of auditors looking at spending and services by public bodies in Scotland. Following an extensive consultation, these changes will come into force from the start of the 2016/17 audit appointments in October.

Two years ago we recognised that if we wanted to deliver a world class public audit service, we’d need to revise and improve the code. The challenge was to produce a code  grounded in legislation and auditing standards but which could also be applied by auditors to the wider scope of  public audit  and the developing approach to the audit of Best Value.

We also knew that Scotland’s public sector was undergoing a significant period of change and by revising the code we’ve set out to ensure our work adds more value and makes a real difference to public services in Scotland. It requires auditors to comply with professional and ethical standards, and sets out in detail their responsibilities, and those of audited bodies. It also sets the strategic direction of all audit work carried out for the Auditor General for Scotland and the Accounts Commission.

In order to achieve world class public audit and give reassurance that we’re all receiving value for money from public spending, the new code aims to assist improvement by audited bodies in the delivery of services. It does this by requiring auditors to use their work to provide explicit conclusions on four key aspects: financial sustainability, financial management, governance and transparency, and value for money.

Reporting against these dimensions means that auditors must be clear when highlighting significant risks within audits that they also provide a judgement on how effectively the audited body is mitigating these risks. Clarity about the potential impact of risks and making recommendations for improvement creates an enhanced understanding for the organisation and the public of how an audited body is performing.


The code also formalises the commitment of auditors to sharing knowledge and resources, giving an enhanced ability to address audit risks. This means financial and performance auditors working together to maximise the value and impact of public audit for service delivery.

Appointed auditors also have an option to carry out a reduced wider scope audit for low risk small audits. This maximises available audit resources, enabling a greater focus on higher risk audits. Our work is, however, firmly grounded in legislation and auditing standards. Compliance with the code is a condition of appointment for auditors appointed by the Auditor General or the Accounts Commission.

And continuing our commitment to making our audit work as transparent and accessible as possible, we’ll be publishing all our principal audit reports, such as annual audit plans and final reports, on our website.

The new code equips auditors with the information and structure they need to carry out their role effectively within the changing landscape of public finances and services. Building on our independent and authoritative reputation within Scotland’s public sector, the code helps to ensure a strong and effective system of financial accountability and transparency with public audit at its centre.

About the author

OwenOwen Smith is a senior manager in Audit Scotland’s audit strategy group. He is responsible for audit procurement, audit quality and the National Fraud Initiative (NFI) in Scotland. He has been working in public audit since 1997 and been with Audit Scotland since its creation in 2000 working mainly in local authority audits. He is currently finalising the 2016 NFI report.

Local government accounts – what can they tell me?

All 32 of Scotland’s councils publish a wealth of information through their annual accounts. They can tell you everything from how much your council spent on social work or education to the value of their buildings and what reserves they have built up over time. The Accounts Commission’s report ‘An Overview of Local Government in Scotland 2016presents a high level view of how councils manage finances.  But getting more specific information that compares spending over time or between different councils from published accounts can be difficult and time consuming. To help, we’ve produced an interactive exhibit which makes these comparisons easy.

Councils make decisions about how best to manage their finances and these will be influenced by various local factors, including local priorities, the size and nature of the area they serve – be it rural or urban – and their local assets and infrastructure.. . For example, councils that still own council houses will generally spend a greater proportion of total spending on housing. This means that comparing some items from the accounts, and some councils to each other, might not be as useful as you first think. All 32 councils, however, need to provide certain core services and looking at how spending on services varies between councils, and within each council over time, can be a useful way of seeing how they are managing their priorities and money.

In this year’s interactive exhibit we have focused on council spending on services: what they spent in total on each of their main services (gross spend) and what they spent after  grants and service charges were taken into account (net spend). By clicking on a particular service you can see how spending has changed over time. You can also look at these changes in real terms, where the figures have been adjusted for inflation, to show what the earlier amounts would have been worth in 2014/15. Comparing these figures over time can provide a useful insight into how your council has managed its budget in a period of reducing public spending.

We intend to update this information as we receive new figures (2015/16 figures will be added once they are available later this year). We have focused on one particular part of the accounts but we’re keen to hear what you think is missing and what you think we should consider including in the future.

About the author

MM6A6194Martin Allan is an audit officer with Audit Scotland’s Performance Audit & Best Value group. Before joining the organisation he worked in statistics in the English civil service – first in the Department for Business, Innovation & Skills, then in the Department for Environment, Food and Rural Affairs (DEFRA).

Audit and accountability: Supporting the new Scottish Parliament

Holyrood meets for the first time today, and it’s set to be an interesting few weeks as the new Scottish Parliament comes into focus.

It’s clear that the new Parliament will be different from the last. As well as welcoming new MSPs and preparing for the fifth session to officially open on 2 July, the months ahead will bring big changes in Scotland’s public finances as the Parliament takes on a substantial increase in its financial powers.

Given the very different manifesto commitments from each of the political parties, there will continue to be a debate about the use of these powers over the life of the new Parliament – in particular, whether to use its new tax powers, and how to use any revenues raised by them.

This new chapter in Holyrood’s history brings opportunities and risks for everyone involved in ensuring that public money is spent well, including Audit Scotland.

We provide independent and expert insight into how public money is spent and policy is delivered, responsible for auditing more than 200 public bodies in Scotland. Whatever the political make-up of the Parliament, we’re here to support it in scrutinising the use of public money and holding government to account.

The Smith Commission agreed that the Scottish Parliament should seek to expand and strengthen the independent scrutiny of Scotland’s public finances, in view of the additional variability and uncertainty that further tax and spending devolution will introduce. I wrote to the Conveners of the Finance Committee and the Devolution (Further Powers) Committee in March, highlighting my interest in two key issues – the need to ensure the financial sustainability and management of the Scottish public finances, and the case for comprehensive, transparent, reliable and timely reporting.

The new powers mean there’s a need to look again at the Parliament’s arrangements for budget oversight. The budget processes put in place in 1999 have served the Parliament well, but they need to be refreshed so that Parliament, Government and the public can understand and debate the basis on which spending decisions and policies are made. This is especially important with the continuing financial pressures on Government, and the ambitious programme of public sector reform now underway in areas such as health and social care, education and communities.

As well as the budget process, an overall account of the revenues, expenditure, assets and liabilities of the Scottish public sector as a whole will also be essential – we have Whole of Government Accounts for the UK, which incorporate Scottish information, but we don’t yet have the equivalent picture for Scotland.

As Auditor General for Scotland, I report in public to the Parliament’s Public Audit Committee. I’m looking forward to meeting and working with new committee members so we can build on the good work of the previous session and ensure MSPs – and the public – get real value from the wide range of Audit Scotland’s work.

I’m also keen to explore new opportunities to support Parliament by informing and engaging with other committees and their members.

We’re committed to helping Parliament to develop its arrangements for using the new financial powers, and to seizing this unique opportunity to help shape Scotland’s fiscal future for generations to come.

About the author

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


Making our data come to life

tableauHere at Audit Scotland we’ve been thinking about different ways to present our findings and data. The way people access information through the internet is changing, with greater use of attractive features. We wanted to bring some of these to our own work to make our information more interactive, engaging and accessible.

A perfect opportunity arose through our recent Major Capital Investment in Councils report. As part of the audit we had asked councils for information on all their capital investment projects over £5 million. We had also compiled information from the external auditors and the annual accounts on how these infrastructure projects are funded.

We used the data to give a Scotland-wide view, but there was a lot of extra material that wasn’t used in the report on specific  projects and individual councils’ funding methods which we thought others might find useful and interesting. There was a lot of interest in it when we presented the report’s findings to the 7th Annual Scottish Capital Investment and Infrastructure Conference. So we opted for the data analysis and visualisation software Tableau to create an interactive exhibit on our website – you can have a look at it here. The exhibit is made up of four dashboards that visitors drill deeper into the numbers in the report such as by clicking on council on the map or else the categories in the graphs.

What we found is that the interactivity highlights data and trends that might be missed in a big table of information. Not only does the software make data look great it also does the analysis quicker than what we have done in the past. We are now thinking of whether Tableau could be used to help us scope our performance audits.

We hope this gives people a better understanding of how the public pound is spent in Scotland. And it may help councils and other public bodies make useful comparisons and help sharing of best practice.

This is the first time Audit Scotland has tried a new output like this so it wasn’t without its challenges. As with all our work it is important that the information we present is accurate and because of the level of detail in the exhibit compared to the report we agreed the factual accuracy with all councils before publishing the exhibit.

We’re looking at other ways we might develop this format so it would be great to hear your feedback.

About the author


Ashleigh Madjitey is an Audit Officer in Audit Scotland’s Performance Audit & Best Value group. She was part of the audit team on the Major Capital Investment in Councils report and has also audited Argyll & Bute Council and broadband infrastructure investment.