 Fy noreddynt, ac rwyfodol gyw y 11 mewn adït yn 2019. Fy noreddynt nrw, dweud o mynd i gyfnodd beidydd ar y cynwheel ar gyfer gynnig. Fy noreddynt, diwylliannwch i chi i gyfnodd gynnig 3 ar gynnig. Block, Llywydd, Merzynau Cymru, Caroline Gardner, Auditor General for Scotland, Fraser McKinlay, Controller and Director of Performance Audit, and Best Value, ac Anthony Clark, Audit Director, Performance, Audit and Best Value, all from Audit Scotland. I'm going to ask the Auditor General to please make an opening statement. Thank you, convener, and thank you for the chance to brief the committee on the work programme for 2019-20 to 2023-24. As you all know, public services in Scotland continue to face unprecedented challenges in terms of both public expectations and demographic change. Public bodies are working hard to deliver more preventative models of service delivery that address inequalities and improve long-term outcomes. This is not easy, obviously, but it is essential if we are to have sustainable public services in the longer term. At the same time, services are increasingly being provided in new and innovative ways through public, private and third sector partnerships, and the lines of accountability are increasingly complex. This creates risks that need to be properly understood and managed. We think that most public bodies have so far coped well with these challenges, but they are facing increasingly difficult choices. As auditors, we see increased risks in relation to shortfalls in skills and capacity and financial pressures in public services like the NHS. These are only likely to increase in the medium term. The briefing paper sets out for you some of the key public sectorists that have informed the performance audit programme, the planned part of our work. It is worth stressing that I keep these under review to respond to developments such as the impact of the UK's decision to leave the European Union and other policy developments as they emerge. An important aim of the programme is to help the committee to scrutinise the impact of significant areas of investment and government policy, such as the expansion of early learning and childcare, the proposed order of strategic capital investment and the programme of work on Scotland's new financial powers. We also consider a host of other factors, including the implementation of government policy, areas like improving educational outcomes, supporting people with mental health problems and tackling child poverty, are all examples of auditing the effectiveness of policy implementation. This is also an area where Audit can support the committee in its post legislative scrutiny role. I share the committee's interest in crosscutting areas like digital and workforce planning, and you'll see a number of audits on those issues. We also aim to ensure that the audit work reflects the concerns of the people who rely on public services, for example through audits of health and social care integration. The briefing paper sets out the proposed five year rolling programme with appendix 1 setting out the likely scope of performance audits planned through to 2021 and appendix 2 outlining the longer term programme. There's obviously more room for flexibility and change in the longer term programme than in the work that's now well underway. The briefing paper also summarises how the work programme reflects the crosscutting themes from the committee's business planning day last September and how I've responded to the feedback that the committee helpfully gathered from the subject committees this year. I'd welcome feedback on the work programme from the committee together with areas that you'd like us to consider for future work, and as always, the team and I are happy to answer questions. Thank you very much indeed, Auditor General. I'm going to ask Alex Neil to open questioning for the committee. I have no dispute at all with the work programme itself, Auditor General. I have two questions that really push late to possible additions. I welcome some of the crosscutting work, obviously digital being a good example of that, workforce planning clearly is a major area, not just in the health service but elsewhere. One of the crosscutting themes that we have had is the level of remuneration at the high end in the public sector. A report came out last week, for example, in relation to local authorities. One former chief executive recently stood down, was earning £200,000 including pension contributions, while low-paid workers were being sacked because of the cuts. If you look at the Scottish Water Bonuses, for example, it really does beg some questions about, are we really getting value for money at the top end? Having been in business and having run Government departments, I know the need to attract talent, but it doesn't strike me particularly that that is justifying some of the excesses in the public sector. There is a lot of public concern, particularly at a time when people are suffering major cuts in services. People are being made redundant, usually low-paid people are being made redundant, and they see these excessive salaries and remuneration packages at the top end. Is there no time for that? It's a really important question, and, as you know well, a complex one. The people who tend to attract the sort of media attention you're talking about are the people whose salary is at the top end of the range, not just in their organisation, but across the public sector. I also think, as you say, that there is that important balance between being able to attract people to do the jobs while making sure you're not paying more than is needed for that and that it's in line with pay for staff as a whole. I think we recognise that there is more transparency about pay and reward in the public sector than there is in the private sector, and that's a useful starting point. I think we can think hard about how we use our routine reporting to provide a bit more of that transparency and perhaps analysis to you. But I would say that one of the things I'm concerned about in the work that we've reported to you already is, for example, the difficulty there is in attracting chief execs of the right number and calibre for NHS boards, where pay has been quite constrained over recent years in line with public sector pay policy. And that's making it harder to attract and keep the people needed to do what are very big and complex and challenging jobs. So if you're content, I think what we can offer to do is to take the question away and think about how we might either do some straightforward analysis to provide to the committee to follow your own interests with government about pay policy and the way it works or to inform further work that we do to narrow that down into something that is a useful piece of work for you that starts to answer some of those questions. I mean, I do recognise in some situations that top salary isn't big enough to attract the right calibre of persons. But I think if we were coming at it systematically and could prove that that was the case, then it would make it more acceptable to people that they have to pay over the odds as they see it to get the right person. Obviously, it's linked in, for example, one of the reasons we can't find enough chief executives of NHS boards is that there's just far too many boards. It's about the management structure of the NHS particularly. Now we've got the joint boards on top of the health boards. So a lot of new boards have been created, but none have been abolished as a result of that. So that ties in, obviously. So it is a complicated issue, but I think it's one where there's a lot of public concern, particularly at this time of cuts, particularly when the cuts are falling on people who can at least afford it. And there's a lot of perceived unfairness and wastage. So if you can look at that, that would be extremely helpful. The second one is more specifically on Scottish Water, leaving aside the issue of the bonuses. I know, obviously, that Scottish Water has got its own commissioner. In terms of regulation and so on. I'm not getting at Scottish Water, but it seems to me it's a very significant organisation. It's a very important organisation, and yet all the time I've been in this committee, I've never seen any report on Scottish Water and where it fits in looking at its investment programme and its modus operandi. I think some of its recruitment practices are perhaps not in line with what I would expect of a Government agency, if I can put it that way. So, and I realise, obviously, that Scottish Water, there's an interest in local government, obviously in Scottish Water, because of this division of responsibility in terms of water and sewer services. But is there not a case for, and it might be the need to do it jointly, to have a wee look at Scottish Water, because we've never had a fundamental look. I mean, it's now been up and running as an organisation for some considerable time. My predecessor, Robert Black, reported on Scottish Water as a performance order I think around 10 years ago, so it's not true to say that there's never been one, but certainly not in my time, it's ordered to general. It's important to be clear that I appoint the auditor to Scottish Water and that audit takes place annually and is reported in the normal way. You're right that I haven't added a report to it primarily because, on the whole, I think it is a well-managed organisation. But I know Fraser and the team have been thinking about this question in response to your own interest last year, so I'll perhaps ask Fraser to pick up where we've got to in that thinking. Thank you, Attorney General. Yes, you raised this last year, Mr Neil, and I think what we're looking at is exactly what would be most helpful for you. I always hesitate to use the word unique in these circumstances, that Scottish Water is probably a unique organisation in Scotland. That might lend weight to your argument for having a look at it. It also means that we need to think quite carefully about the nature of that piece of work and what the scope is about the value for money and the performance of the organisation. It's about how the whole setup of Scottish Water as a body in Scotland and how the water industry works in Scotland, which is obviously different to elsewhere. We've been working with and speaking to the auditors about that. What we can absolutely do is write back to you to let you know where we get to with those discussions to confirm what we might be able to do. At the moment, I think our thinking is that it's more likely to be done through the annual audit work that Caroline described. Caroline obviously has powers to report on the back of annual audit reports to you under the section 22 powers that she has. Historically, they've tended to be used for things that aren't going that well, but they don't need to be that, so that might be a reporting option. Obviously, we've got the performance audit reporting route as well. If it's okay, convener, we can write back to you in the next couple of months, maybe, and let you know how we plan to take that forward. Okay, that's fine. The other one that I think needs a bit of looking at is the CalMac and CMAL. I mean, obviously, we've seen the controversy over the ferry's contract with the Ferguson's shipbuilder, but it's not just about that. Although that does raise a lot of questions about procurement of ferries, we've got a dire shortage of ferries that work in Scotland, which is a historic thing, but also how the relationship works between CMAL and CalMac and suppliers and so on. Again, it's not something I've seen any detailed work being done on for a long, long time. Well, we did the ferry's report two years ago, I think, 18 months ago. You're right to say... The services are other than the company and the modus operandi of the company and the relationship between CMAL and CalMac and so on. You're absolutely right. It was primarily about ferry services. There was quite a lot in the report about how all of that worked because we had to set out the complexity of the governance arrangements around that, Mr Neil, you're absolutely right. What I would say is, on the back of that, following up that report through the Transport Scotland audit, Transport Scotland is the sponsored division for ferries, and we're following up the recommendations in that report. Given the things that you've just described, that's something we are keeping a really close eye on through the Transport Scotland audit. As Caroline said, we always keep the programme under review and if we think we need to bring forward something more on ferries and in particular the role of those organisations, then obviously we can do that. I mean, this procurement exercise with the ferries I think is something that, as an audit committee, we should be much more interested in because clearly, you know, Luchto's own situation was getting near resolution and it doesn't appear to be the case, and I think there's a lot of questions to be asked about this. Now, I'm not sure if the Transport Committee is looking at this in depth, but maybe we should check because I think this is something, as a committee, it's very justifiable for us to be looking at this because there's a lot of money involved. I think we can find out if the Transport Committee is looking at this, but Mr McKinlay, can you come back to us on that as well? Sure. It's also worth saying, community, just briefly that through the audit of the Scottish Government, the Auditor General reported on, and indeed I think did a great job in making more transparent the support that Government were giving the procurement of those ferries for ferries and marines. So we are doing a bit to bring some transparency to that and we can certainly have a think about what more might be done. Thank you. Colin Beattie. Thank you, Mayor. General, your programme of work includes work on the EU withdrawal and obviously there's so many uncertainties about that, the scope and timing and so on is probably fairly big and ponderable. Do you have any detail on the likely nature of that work? Because to me, and maybe I'm blowing it up bigger in my mind than it is, it seems to me that this could be fairly comprehensive, it could be a huge piece of work that could nudge other things out. You're absolutely right that so far the challenge has been not just the complexity but the uncertainty and the way in which the likely outcome has been shifting not just day by day but hour by hour on occasions. Like the Scottish Government, we've been monitoring the situation on a very regular basis within Audit Scotland and having weekly briefings with the management team on the impact on the bodies that we audit and on potentially our own ability to do our work. This week, given the agreements that were made just before Easter, we've agreed that it's time to step back and to do some more detailed scoping on what the piece of work referred to in here might be. We published a briefing paper last year about a year ago which set out, based on our audit, intelligence what the impact was likely to be on the bodies that we audit from the Scottish Government body, from the Scottish Government itself outwards, picking up on the three big areas of EU funding, people and regulation. I think people found that quite helpful in helping to direct conversations with Audit committees about what the implications were locally and Audit has found it helpful in building up their own understanding of what the risks were and what the impact might be. We've asked the team leading this work now to step back and just do some more detail scoping on what we might do this year and what the longer-term picture might be. But it's clear that EU funding to particular parts of Scotland and particular policy areas is something which will become important almost whatever the outcome is unless article 50 is revoked. As Fraser was saying just now, very often us putting that transparency into the public domain with our independent view of it can be a helpful step forward. But the team is scoping what we do and again we can keep the committee briefed as that develops. Do you have a contingency plan in terms of depending on which scenario comes about, you may have to drop parts of your programme in order to prioritise the EU withdrawal? The way the programme is put together is built around the presumption that something may come up at any point and that our response is not to come back to you on the SCPA and ask for more resources in normal circumstances but to flex and rearrange what we're doing. In this case I think our approach is a bit more too prong. We've kept some resources deliberately reserved that we can use to look directly at the effect of EU withdrawal and we are also working on the assumption that the individual pieces of work already in the programme may be affected by it. So for example NHS workforce planning, we know that some parts of the NHS rely heavily on staff from other EU countries. We can look at the way in which the Government and NHS boards are responding to the changes of that work, the same in relation to social care. So I think it may become a strand in the work that's already here where that's appropriate rather than meaning that those pieces of work have swept away and something else comes in instead. But we keep it under review. Thank you. Just briefly to add, Mr Beattie. I think when we established the programme only recently December we were still expecting to have left the European Union in March. So this piece of work I think originally was designed to capture the immediate impact of that which is why it was in 1920. The reason I mention that is that I think there may be a good chance that it may not be 1920, it may slip back a little bit obviously depending on what happens with the whole Brexit debate. But as Caroline says, the team are scoping up some options for us over the next couple of months and that will help us to decide what we're actually going to do and we'll keep you posted. I can understand all the uncertainties around it. Just a couple of other quick questions. We highlight through your reports, we receive your reports, we highlight issues and pressures in the public sector in Scotland. Given your links and so on to the rest of the UK do you have any feel for how these pressures are being addressed south of the border? Because the pressures are hugely greater there and they've always had to come up with innovative solutions and so forth. Is there an indication that the public sector in Scotland is learning from that and adapting? The answer is probably that it depends. In some areas there are much more similarities between public services and much more ability to do that learning than in others. There are obviously, as you know better than we do some political tensions that can get in the way of that learning on occasion. Through all of our work we aim to look for good practice not only elsewhere in Scotland but across the UK and globally. That's a big part of what Fraser's been leading for us over the last couple of years. As it happens, Anthony leads our international work. I'm not sure if we count England as international but we do look south of the border. In some places particularly around local government we keep very close tabs on what's happening in councils in England. As you say there financial pressures are even more acute than north of the border and we keep very close to what's happening there. We have very close relationships with the national audit office in London. We work very closely with them on areas of mutual interest. Routinely, when we are doing an audit in Scotland, we will be looking to colleagues in the NEO to see if they have things that we can learn from. In terms of the extent to which Scottish Public Services has learned from other places I would agree with Carline that it's probably mixed and I think that it depends because some models of public service delivery are quite different. The health service in England is set up very differently to the health service in Scotland so you need to be careful about making too many comparisons. That said, I think that we would also be quite challenging of an assumption that there is nothing to learn just because the model of service delivery is different and we would always encourage Scotland to learn from other places. If anything, I think that I see more examples of them learning from abroad from New Zealand, Canada maybe parts of Europe as much as they do within the UK and I don't know if you have anything to add from the international perspective. That phrase is quite right. We see quite a lot of evidence of people looking to New Zealand and other parts of Europe for good practice particularly around prevention and outcomes where there's a well-developed approach to thinking about planning for outcomes in those places and we also have links beyond the NEO to the Canadian Audit Foundation which gives us connections with good practice from North America that we can pick up in our performance audit work. I'm pleased to hear that this exists because obviously the reports coming to us we don't really see that side of it going on in the background. Just at the last question, internal audit. You know I come up with that periodically. Are we expecting too much of internal audit? Should there be a review or have you considered a review of how internal audit functions because, as I've said before we've had multiple cases where internal audit have done their job ticked all the boxes according to their contract or whatever but a problem still develops. Now we've heard before that internal audit is not there to detect fraud and all this sort of thing. You know, they are a gatekeeper in many ways and our local boards for example really aware of the limitations on internal audit functions and that they need to perhaps have other strategies to detect issues that come up. You're absolutely right and you know that we've produced a briefing for this committee about what role internal audit plays as part of the overall controls and risk management within any organisation whether it's the Government, a health board or a council. They're an important part of that system but they are only one part of it. When internal audit is the problem or when there are problems with internal audit we do report that. So for example my section 22 report on the Scottish Government last year highlighted that at that point the internal audit directorate wasn't meeting all of the requirements of the public sector internal audit standards and that does have an impact both on Scottish Government's risk management but also on the bodies which receive services from that directorate. Quite a number of them across particularly the central Government sector and I will continue to do that to report in those terms about the Scottish Government's internal audit directorate and where we see failings in other bodies. It's something that every external auditor is looking at routinely every year. On balance I don't think that an audit of internal audit would add enough value to justify the resources that we would need to put into it but if the committee wants to take evidence from the Scottish Government about its own role both in providing that leadership through its internal audit directorate and supporting bodies in their own development of their governance arrangements to back up guidance like the on-board guidance that's available to them we'd be very happy to support the committee in doing that. Based on your various audits are you satisfied that the local boards and on executives understand the limitations of internal internal audit because once you're sitting on a board you'll be thinking we've got internal audit they're protection against anything that might go wrong they'll pick up anything whereas that is not the case. I think it varies a lot I'll ask Fraser to come in a moment because we do a fair amount of training and support for non-exec directors as part of our continuing work I think a broad generalisation but I think I'd say if you've got a board that's working well the non-exec directors tend to know both what value internal audit can add and recognise that it's not a panacea that it can't compensate wholly for failings elsewhere in the governance system and where you've got a board that's not as effective all of those things tend to be not as effective together and that's clearly where the risks are Fraser do you want to say a bit about the work we do in supporting non-execs and what that tells us? So on a couple of levels we always have a slot at the non-exec director induction events that the Scottish Government runs so we come along and talk about the role of external audit but we also take the opportunity to talk about the importance of internal audit and indeed the differences between the two and also locally we quite often do sessions for audit committees in particular about what they should be looking out for and that's part of the part of the role that external audit teams often play I mean I think our my general sense of it bearing in mind that it comes back to the point Mr Neil made earlier there are something like 227 public bodies in Scotland I think all of which in some way are audited by the Accounts Commission and I guess it's easy to forget that the ones you see coming here tend to be the ones that aren't working so well actually the vast majority of those I think are working fine I think audit committees in the main do understand their role understand the role of internal audit and external audit and as Caroline says we know that because the assurance work that happens in all of those bodies every year through the annual audit work so that's not to say that it couldn't be better in a different part of the world the Accounts Commission published a report a couple of weeks ago about internal controls which wasn't just about internal audit but looked at internal audit amongst other things that are important when it comes to ensuring the internal controls within councils are sound and as Caroline says if external auditors have a concern about the capacity or the ability of internal audit to do a good job then that gets flagged and tends to get escalated so yes I think that's how we engage with it on an annual basis Willie Coffey I wonder if I could ask you where do you think we are in terms of the overall performance improvement agenda for a number of years we've had some fairly detailed and hard-hitting reports from you and we are going to get a number of hard-hitting reports I'm pretty sure over the coming years and as you know for a number of years at the committee we've always been asking how do we close the circle in terms of improvements within the public sector, the embracing and adoption of standards and so on I think we've made some good progress over the years but there's always more that we can do, I know that but what's your perspective on it and do you see across the public sector landscape an improvement in performance that your organisation carries out in this committee? Yes, I mean you know that we take seriously the need to make sure we don't just produce a report that gets attention here in the committee maybe attracts a headline and then ends up attracting dust on the shelf that's not what we're here for we're to improve the way public money is spent and often the way we'll do that for a large and significant area is to keep coming back to it so we report annually on the NHS in Scotland childcare integration we've produced two out of a plan series of three reports that we'll look at the way that's developing similarly on early learning and childcare we've produced one report the turn of the year we'll be producing a follow-up that looks at the way not just our recommendations have been addressed but the progress that Government and local authorities are making and putting in place the staff and the infrastructure they need to do it and I think on the whole we can see improvements first of all it can take a long time so this committee has spent a lot of time looking at digital projects that haven't gone well those tend to have a long tail so we'll be reporting on a couple more that haven't gone well but that have got roots going back four or five years and for us to be still seeing those come through even with all the investment that the Government is making in new skills new approaches to getting that right in future is frustrating to us as I'm sure it is to the committee and things take time the other challenge I think that we see is the ability for Government to learn across its many responsibilities and the many bodies that it needs to work with so we still report from time to time for example on Government being very clear about the outcomes that it wants to achieve for example in relation to improving health and social care but not having in place the measures it would need to know whether it's doing it or not and therefore what it's spending what it's investing is effective and one obvious example of that is that almost 10 years on now from the establishment of the 2020 vision for health and social care we still know much less about what's happening in primary care and social care than we do about what's happening in acute hospitals and that makes it hard not just for us but for Government to know how well it's going and to make sure that it's doing more of the things that are working and less of the things that aren't so on balance I say we are seeing improvements but not in a consistent and systematic way across the whole picture Do you think therefore that there's not enough evidence from whatever organisation you look at to demonstrate to both you and to us and to the public that lessons have been learned and improvements are being made do you see that circle being closed more than you perhaps did in the past? I would say more but not consistently enough I think that if the outcomes approach is about anything it's being very clear not just about what are the outcomes that you want to achieve but about how you're going to do that you need to have a real plan for how you expect to improve those outcomes have the money you're spending the people working on it are going to make a difference in some areas we see that working pretty well in some areas there are still gaps and unless that planning is going on at the beginning all of the benefits of the outcomes approach not all of the benefits are going to be achieved and I think that that's an area where the committee could have an impact currently finalising a piece of work that aims to give the committee a basis for inquiring into that a bit further and also provide some support and guidance to the government and public bodies along the lines that you were asking about a moment ago and I hope that that will be something that will just add to this debate a wee bit on the issue about embracing standards recognised international standards DC resistance to that across the landscape of DC much more of a willingness to embrace every time I see a report from you I always look to see if the said organisation has adopted and embraced whatever management standard be it IT, development or construction or anything and do you see a willingness to engage with these standards and to adopt them? The best example probably is digital where those standards are they exist and they're well known and well understood I think that what I would say is that for the large organisations and for the chief information officer and the infrastructure around that they're well understood and well used where we see problems are with smaller organisations that don't understand what they're getting into when they start a programme off the committee's seen an example of that recently there's another report coming through shortly where a project started a while ago without that clarity I think that the variability still exists and the risk is probably in smaller bodies or projects that are a bit older and if I could just ask a question on one of the specific pieces of work that you're planning to carry out on the enabling digital government I wonder if you could tell us just a little bit more about what's in that and is there anything in that on looking at data analytics and the lack of regulation that's actually in there about how data is actually used it's not covered I believe convener using the GDPR regulation and there's big issues there about how data is actually used by companies, corporates or whoever will you look at that aspect and will you also have a wee look if possible at how organisations are applying the GDPR regulation I think in my view some experience I've had convener as the organisations are using it as a shield to prevent scrutiny and accountability for example convener, a recent example found out the owner of a dilapidated building to ask them to clean it was prevented was not disclosed to me and GDPR was used as a shield to prevent that and I don't think that was the purpose of GDPR at all so there are issues in there about security of data and whether people are actually using that to prevent scrutiny of whether it's in the public sector or not I'll ask Fraser to come in in a moment you'll see that the enabling digital government piece will be published shortly and we're finalising it at the moment I think it's fair to say that that doesn't focus primarily on the GDPR elements but Fraser can give you a bit more information about our thinking in that area I was about to say the same thing as Caroline Mr Coffey and the enabling digital government audit is specifically looking at the role of the Scottish Government in ensuring that digital government is being rolled out effectively being a really interesting area about what is reasonable to expect Scottish Government centrally to do in terms of enabling digital government so that's the focus of that piece of work it won't really get into GDPR in response to your earlier question I'll speak to the team about whether there's anything we can say about the use of standards as part of that work we're seeing the team I think just next week Caroline so we can feed that into there the GDPR thing is interesting because of course there is the information commissioner who is responsible for the regulation and looking after GDPR and how that's being implemented from a personal basis I think I recognise the circumstances you've just described what I can say is it will pick up that conversation with the information commissioner because it's there's something here about ensuring that we're all clear about who's leading and who's responsible for that so very happy to pick that conversation up with colleagues in the information commissioner's office okay, okay that's an interesting point you raised Mr Coffey but of course we're doing our post legislative scrutiny on freedom of information and as GDPR is an exemption it may be coincidentally that the committee does cover this under post legislative scrutiny but I certainly think it's worth looking into do you have any further questions Mr Coffey okay, Liam Kerr please thank you, Covina, good morning I think that Willie Coffey does raise some important points there I'd like to just develop one particular area and that is around the part of the problem that we often see with these reports is that the government's bringing in policies based on as you said Auditor General perfectly understandable outcomes desirable outcomes but because there's a lack of baseline data it's very difficult for anyone let alone this committee to assess the success or the progress from whatever that baseline should have been so some of the examples that I think this committee's looked at would be the mental health, the children's mental health the ferry services, the road equivalent pricing it rather seems somewhat endemic so is that a line of inquiry that you will be looking into this lack of baseline data and what's being done we look at it as part of pretty much every performance audit that we carry out as you say unless you know where you're trying to improve from having an outcome in mind and a goal for where you want to get to isn't very helpful it's an aspiration rather than a plan and something that you can invest in and monitor your progress against I'm not sure that looking at it as a thing in itself is helpful because it is so variable across the piece as Fraser said, the things that come to this committee are often the things that have not gone so well rather than the things that have gone well but I do think there's scope for more a more systematic approach in government building on the real success the internationally recognised success that is the outcomes approach the national performance framework in legislation to make sure that in every instance they're being as rigorous as they are in the best so to take one example if you look at the patient safety programme in the NHS and elements within that such as healthcare required infections the government has been really rigorous in knowing not just nationally but in every healthcare every hospital, every health site what the starting levels of infection look like having a plan for how they intend to bring them down by involving staff in thinking about what would make a difference here locally and then monitoring day by day what's happening with it and you can see the results in the numbers coming down that's not to say that terrible things don't still happen from time to time but across the country we know we're better off because of that rigorous approach we don't see the same rigor being applied to looking at what might be needed to make sure that older people who are just about managing in their own homes can be helped and supported to stay there safely rather than getting into that vicious circle of hospital admissions and gradually getting less and less able to cope now it's more difficult to do it for older people and a whole system of health and care but the principles are the same we keep reporting on that and I think the committee's got a really important role to play in pulling back and looking at what government's approach is to making a reality of its national performance framework and in a sense doing that on behalf of the Parliament as a whole we sometimes reflect that this Parliament doesn't have a public administration style committee looking at those cross cutting lessons about the way the government does its business and I think this committee can place a part in some of that work of our work and in relation to your post legislative scrutiny responsibilities we're very happy to talk to the committee about how the work we've already got on the stocks can help with that and how we can produce further analysis further information from what we do that pulls together some of those lessons to help you take that a step further and is that just on that last point the answer to the question how do we ensure that government can extrapolate from let's say the good practice example that you gave in the NHS across to other projects is that something that we need to work with you so that the committee can understand how to get those lessons where they need to go I think that that could have a real benefit in helping to improve the quality of policy making and implementation across the piece what we find is that often when we've reported on something there's a real improvement on it so I hope that when we report back to you on early learning and childcare that baseline data in place and the measures for how it will improve but that doesn't always translate into confidence that when we move on to a new area of policy that we're going to see the same learning happening and I think this committee is very well placed to ask government how it intends to make sure that those improvements that the lessons that are learned in one place are fed out and picked up right across its business finally briefly and just like Mr Coffey I'd like to go very specific are you going to do anything on the AWPR the Aberdeen western peripheral route we have nothing specifically in this programme at the moment but as Fraser said we do audit Transport Scotland every year and Transport Scotland is the sponsoring body for AWPR plus a number of other major capital investments we also support the committee in your scrutiny of the infrastructure investment programme and we'd be very happy to look at how we can help you to use either of those vehicles to scrutinise Transport Scotland and the Government in relation to that big project if I'm frank we could spend all of our time looking at big projects in Transport and other big investments we have to be selective but we're also keen to look at how we can help the committee follow up your own interests through the information and work that we already have thank you Fraser McKinley on the report that the Order of General and the Council Commission have on the stocks on revenue financing of assets which is due to publish August, September I think this year I mention it because AWPR is one of the case studies we've looked at I also mention it because I'm managing your expectations it is not an audit of AWPR but you will see that as one of I think six case studies we've used to look at how non-profit distributing and the hub models so it gets a bit of focus in there but as I say it's not in order of how that project went as such I mean we'll see what comes out but I suspect that area is one where we'll be very interested on the financing and the revenue so When is the next transport audit due at Auditor General? The Audit of the 2018-19 accounts is just getting underway now it will be published in the autumn and I'll consider whether a section 22 report will be helpful to the committee as part of the normal process Bill Bowman A couple of areas to ask about The first one is on your rolling work programme just to ask about a couple of items a bit more understanding In 2021 you've got one that says commonwealth games legacy what would that be? I'm going to ask Fraser to pick that one up on the basis that I won't be Auditor General by 2021 I'm not sure if I should pick it in It seems a long time ago It does The idea is that we've done a series of these so we did one before the commonwealth games to check on how the organisation was going we did one immediately afterwards and we'd always planned to do as the name suggests a legacy one so given that the objectives around the commonwealth games as well as running a successful event about legacy was about supporting communities and particularly in the east end of Glasgow but not only in other parts of Scotland too that piece of work is looking at the extent to which those wider objectives of the games have been met or not It's spending a lot of time on that because if you find something's not done it's a long time after and you probably won't be able to do much about it at that time So it will not be a massive audit I don't think and it's one of those that if there's nothing to see we get to that point quite quickly but having said that given that it was a significant amount of public money that was spent on it given that it was predicated on making a long term difference we think it's quite an important thing to look at but no it's not going to be a massive piece of work I don't think Then looking in 2324 and I don't know how Auditor General's hand over to each other whether they're like presidents and write letters to tell them what to look at you've got support to rail services What would that be? The thinking just pulling back a little bit the way the whole programme is put together obviously isn't dependent on the whim of me as Auditor General it's based on a lot of development work that goes on within Audit Scotland and on engagement with the people whose views we want to inform this politicians, managers, service users and so on it seems to us that rail services are a really important part of Scotland's infrastructure investment and indeed continuing revenue support the overall transport plan at the moment there are big improvements going on to the Edinburgh Glasgow Improvement programme as well as questions about the ScotRail contract and the new sleeper arrangements that are coming into place and I think the thinking is that that might be a good time to take a step back and look at that in the round 20 years of the programme can flex and change as circumstances change but it's a placeholder to say we think there's something that would be worthwhile at that point Support in that context means money from the Government to this and given that rail services are in boxes almost every day what's coming up imminently on rail? I think the answer again is the Transport Scotland Audit is always looking at the amounts of support that are provided in ways to rail to ferries to roads investment and that we will keep under view the issues that we think need to be audited and those that should be reported on to this committee as part of the routine work Taking up Liam Kerr's point on the AWPR will ScotRail just be a paragraph in that or would you have a significant section on the problems that they're having? It's unlikely to be a significant section Mr Bowman I think that's fair and I think that the real benefit of bringing this to you is to get a sense from the committee about what might be more urgent than the programme suggests so the reason we have a rolling programme when we review it every year is so we can flex things and bring things forward and move things back so if the feedback is that something around rail would be of interest to the committee sooner or later than later then absolutely we can build that into the thinking for the refresh this year It would be for me anyway Just to then move on to what Alex Neil was saying about top-end pay I know in the private sector if there's a problem the CEO is often the one that goes first now that's not often what you see here we occasionally see a CEO perhaps leaving Do you look at any form of how CEO or chief executive appraisal is done in the organisations you look at? It tends to come up only where there is a problem in the way that you've described so I think if you think back to the work we've done on the SPA it became clear in that that first of all the former chief executive hadn't supported the authority itself in the way that we would have expected and that the authority's options for dealing with that were constrained by the way in which they had or hadn't appraised his performance in those instances we'll report that to the committee as part of what we've seen there it's difficult to see how we would be looking at that as a theme across the piece but it certainly does become an issue where we're looking at what's happened in the instances of a particular organisational problem There might be a question as to whether it happens at all Can I come in here? I'm just reminding myself that in paragraph 22 Mr Bowman of our briefing note to you mentioned the fact that one of the areas of our programme development activity is around public sector leadership and that list of things that we have in there under programme development are things that we recognise as being really important but we're not quite at a stage yet of how we figure out how to turn it into an audit I guess would be the simple way of putting it and indeed many of these will then lead to if you like proper fully blown performance audit performance audits later on so that seems to me an obvious place where we can bring that into scope There's a question as you say just even a baseline of do they all happen I'm interested equally in things like what do chief executives objectives say what are the kind of systems of accountability and incentives for chief executives of different public bodies are we in objectives sense and in terms of the appraisal sense ensuring that they are doing the things that we say that need to be done is fascinating so we'll pick that up as part of that programme development work which in turn might turn into something else and as we say in here while we don't tend to publish these in a sense obviously more than happy to share those with the committee thank you Auditor General I'm just conscious that our job in the public audit committee is to follow the public pound but something that I've become increasingly concerned about is that large chunks of money are given in grants to bodies, often commercial companies that don't fall under your jurisdiction to audit understandably so but some examples I would give would be the £45 million that was given to Ferguson Marine a few years ago I think under the former First Minister and then the £46 million that was given to Prestwick Airport I'm really wondering if you have any jurisdiction at all to really look at these sums of money and assess their value for money for the public purse and really what has happened to that money second question be when the Government I think both of them were loans expect to get them back if any of that money has been repaid and if the Government is getting a suitable return on those investments You are absolutely right that where Government or other public bodies are funding third parties, private companies, third sector organisations I generally don't audit those bodies and therefore I can only look through the lens of the bodies that I do audit As Fraser said earlier one of the things that I think we've been quite successful in in Audit Scotland is making that much more transparent so when the Government bought Prestwick Airport we reported on that through the Transport Scotland Audit and reported it to this committee Last year's section 22 report on the Scottish Government included the support that had gone to Ferguson Marine and to Burnt Islands Fabrications Limited not only bringing that into the public domain in one place but also making a recommendation that the Government itself should have a framework for when it provides that funding what its overall capacity is how it's monitoring performance and what its exit strategy might be We'll continue doing that but I do think that the committee itself has got an important role in asking some of those questions directly of Government or the body that's providing the funding We can continue to provide the transparency but there are often questions of policy rather than questions of audit problems that we need to highlight to you I'm very clear that the Government is able to provide support to companies in the way that it has been doing but there are trade-offs in doing that there's an opportunity cost to it and the committee is well placed to be asking those policy-related questions about what it's intending to achieve and how that's working out in practice Can I ask you another example of non-commercial practice and a use for an example and we've discussed this before the V&A in Dundee a significant amount of public money go towards the V&A and great projects so directly from the Scottish Government but also indirectly from the Scottish Government through local universities and other entities Are you seeing an increasing amount of this happening where government money is being funneled towards projects that don't come under your jurisdiction to audit such as V&A Dundee To be the more unusual projects like V&A Dundee has been but you'll notice in the programme we've got some work underway at the moment on city deals and they're often very specifically funding from a number of sources UK Government Scottish Government, local authorities universities coming together and one of the questions in that piece of work is absolutely about the governance and the accountability for the money that's going in Fraser, do you want to say a bit more about that? About the city deals nothing much to add convener, I think it's quite unusual where you get certainly on that scale obviously public bodies are giving money to third sector or private sector organisations all the time in a sense I think we continue to be satisfied and I can speak for the local government end of this discussion as well in terms of councils giving money to other organisations that the powers we have to get assurance on how that money is being used and importantly I think that even if it is the case that whether it's Scottish Government or a council or any other public body is giving money to a project or to a third party it's their responsibility to ensure that they can track how that money is being spent, they don't just hand it over and that's where we do still have powers and control Your answer Mr McKinlay and the Auditor General's touch on governance and accountability please make my final question on this that governance and accountability in terms of these grants both commercial and non-commercial grants being given rests I think with Scottish Enterprise I might be wrong but I don't see any audit of Scottish Enterprise in the rolling work programme Has there been one over the last few years that I just can't recall to mind or is there one planned We're saying again first of all there's an audit of Scottish Enterprise every year and that gives that baseline of assurance We did some work on their role in supporting economic growth three years ago and there's a number of programmes in here particularly the work on skills which at Scottish Enterprise play a big part in but I think the assurance we can give you is first of all that we audit Scottish Enterprise every year and that sort of funding to third parties is always an important thing that the Auditor is looking at to see if there are issues that we identify and also as Fraser said that we have VNA Dundee on our radar as a watching brief and if concerns emerge there we can use our powers to report on it at the moment we don't have that concern and we can pick up the transparency point in other ways as I think we did in the section 22 report on the Scottish Government again last year that's a big wide-ranging report but it's a useful place for us to be flagging these things so we know the committee's interested in that perhaps aren't transparent otherwise that the committee is well placed to follow up Thank you very much Final question also, something I've raised with you before on drugs I think Audit Scotland is looking at this inform of a briefing is that correct sorry when I say drugs I mean the awful and tragic circumstances that we have the highest number of drugs deaths here in Scotland in Europe and I think Audit Scotland we're doing some work as to perhaps why that is and if services are working correctly to prevent that can you say a little more about that please Yes, we're doing a briefing on drug and alcohol services which to an extent is following up a report we carried out a number of years ago across Scotland Fraser do you want to update the committee on where we are with that? Certainly, so we're basically putting the finishing touches to that briefing now convener so we're very happy to share that with the committee in the next month Great, thank you very much Do members have any further questions for Audit Scotland on their work programme? Can I thank you all very much indeed for coming to give evidence on your work programme this morning and now close the public session of the committee