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

 

Auditing Scotland’s further and higher education sectors: The story so far…

Scotland’s universities and colleges deliver a wide range of benefits to individuals and communities, and so most of us will have an interest in how they are performing, particularly in this time of significant change and uncertainty for the country’s public finances.

On Thursday, the Scottish Parliament’s Public Audit and Post-legislative Scrutiny Committee hears from Auditor General Caroline Gardner and Audit Scotland teams – myself included – on reports we’ve recently published on the higher education and college sectors. Members will also hear from the Auditor General on challenges facing Edinburgh College, and Glasgow Colleges’ Regional Board.

cover800x1132I was part of the team taking Audit Scotland’s first look at the entire higher education sector, which attracts a growing number of students and is internationally renowned. More than 50,000 students from outside the UK came to Scotland to study in 2014/15, and almost all Scottish universities deliver higher education abroad, either by running overseas campuses, through partnerships with other universities, or through distance learning.

In 2014/15, the Scottish Government provided over £1.7bn in funding, made up of direct funding to universities and financial support to individual students, such as paying tuition fees and funding student loans. Our report raises important issues about the use of public funding, and the challenges facing both universities and the Scottish Government if the sector is to stay successful, and if the Scottish Government’s policy ambitions are to be achieved.

For example, one of our key findings is that it’s becoming increasingly difficult for Scottish students to get a university place in Scotland. There’s a need for greater understanding of trends in applications, offer rates, and acceptances to assess what impact Scottish Government policies are having on access to university for Scottish and EU students. This is one of several recommendations we make in our report, touching on areas such as student support, widening access and the role of the Scottish Funding Council (SFC)

The review of higher education was followed by Audit Scotland’s annual look at the performance of Scotland’s colleges. This piece of work was managed by my colleague Stuart Nugent. You can listenas_cover_colleges to Stuart discuss the key findings of that report here. Though colleges and universities are very different bodies in a number of ways, both sectors face challenges. In the case of colleges, substantial reforms have transformed the way that they operate and deliver services.

Our latest review of the college sector found that it is financially stable and achieving learning targets, whilst still adjusting to the big changes it’s experienced in recent years. However, several issues remain outstanding if the full effects of government reforms are to be understood and addressed by the sector.

Like universities, the college sector is experiencing changes within its student population – though for different reasons – such as growing numbers of under-25s in full-time education and reductions in women and over-25s. Our report states that the Scottish Government, the SFC and colleges need to work together to improve their understanding of demand for courses across the country, and create long-term plans for how they will commit finances and staff to meet future need.

Both of these reports have generated a lot of ongoing debate about the future challenges facing the respective sectors, and how to manage them. The Scottish Government and SFC have responded to both reports ahead of Thursday’s meeting and once we present our findings to the Public Audit and Post-Legislative Scrutiny Committee, members will then decide what action they would like to take to continue their scrutiny of the sectors.

For our part, the audit teams will continue to explore ways to engage with stakeholders on our recommendations and share the knowledge we’ve gained through our work. For example, I’ve been travelling round the country since July, presenting our findings at universities and sector events and it’s been really interesting to hear the range of views on what approach should be taken to deal with the challenges ahead.

We’ll use this feedback to consider how we can focus our future audit work on education, and will post updates on our website as that starts to take shape.

About the author

kwsmallKirsty Whyte managed our audit of higher education in Scottish universities. She has worked at Audit Scotland for over 12 years undertaking performance audits on a wide range of topics across the whole of the public sector, including school education, the use of locum doctors in the NHS, and efforts to reduce reoffending.

Playing our part in the changing landscape of Scotland’s public finances

There’s no doubt that this is a busy and exciting time for anyone with an interest in Scotland’s political and financial landscape. Generating a lot of discussion is the Scotland Bill 2015, set to grant further financial powers to the Scottish Parliament and establish a new fiscal framework which could substantially revise its budgetary and funding arrangements. All of this is taking place while new financial powers in the Scotland Act 2012 are being implemented.

A number of Scottish and UK parliamentary committees have taken an interest in the development of new financial powers. Audit Scotland also has key role to play in this fast changing area of public finances, and we’ve been one of many public bodies asked to give views to Parliament on this important area.

We set out initial views on the audit arrangements for any new financial powers in a submission to the Public Audit Committee in August 2015, and I gave evidence on behalf of Audit Scotland to the Finance Committee’s inquiry on the Scottish Fiscal Commission Bill. The Commission plays a vital scrutiny role by providing independent assessments of forecasts of tax revenues, and its remit is likely to grow with further financial devolution.

We’ve also looked closely at how implementation of the Scotland Act 2012 has been prepared for, and managed; we first reported on progress in December 2014, and we’ve recently published a follow-up to this work, available here.

Our latest update explained how Revenue Scotland – the body responsible for the administration of the newly devolved Land and Buildings Transaction Tax and the Scottish Landfill Tax – effectively managed risks to make sure they were delivered successfully from April last year. In short, a good news story, though there’s still a lot of work ahead.

We also reported that some arrangements to manage the powers in the Act (and potentially the Scotland Bill 2015) beyond this year are still being developed, which is reasonable. However, we’ve highlighted the need for the Scottish Government to be able to move quickly once key agreements are reached, so it can be in a position to manage the new powers well and deliver financial reporting that’s comprehensive, transparent, reliable and timely.

On Wednesday (27 January), I’ll join the Auditor General and colleagues to discuss our findings with MSPs on the Scottish Parliament’s Public Audit Committee. The session will be broadcast live on Parliament TV.

MSPs will also hear from the Auditor General on other interesting new work which has seen Audit Scotland provide assurance to Parliament on an audit of the Scottish Rate of Income Tax (SRIT). We reviewed the National Audit Office’s first annual audit of HMRC’s implementation of the SRIT, which comes into force in April 2016. The Auditor General will report annually to the audit committee on the NAO’s work in this area, and it’s provided a great opportunity for us to work with another UK audit body.

Public audit provides assurance that public money is well managed. This is important for the public and decision-makers, and will become even more relevant as Scotland takes on further financial powers. For Audit Scotland, it means that the scope of our work will likely become more wide-ranging and diverse.

About the author

MarkTaylor Mark Taylor is an Assistant Director in Audit Scotland. He oversees a wide portfolio of central government audits, including the Scottish Government audit.