 Good morning and welcome to the fourth meeting of the Economy, Energy and Fair Work Committee for 2019. First of all, I would ask all those in the public gallery to turn off their electrical devices or any that might interfere with the systems. Item 1 on the agenda is a decision by the committee to take items 3 and 4 in private. Is the committee agreed? Yes. Thank you. This morning, item 2 on the agenda is the registers of Scotland, and I welcome this morning Jennifer Henderson, keeper of the registers of Scotland, and Janet Eggdall, who is operations director and accountable officer from the registers of Scotland. We will turn now to questions from committee members, and I will start first of all with Jackie Baillie. I wonder whether I could explore with you your status and your accountability. I understand that you are a non-ministerial department. Could you tell us what that means in practical terms and also explain who you are accountable to? We are accountable to Parliament. I will start with that. Events like today are part of that accountability. Our non-ministerial status means that we are not subject to the direction of ministers for the day-to-day operations of what we do, so ministers are not directly involved in any of the decisions that I make around registering people's property. Our framework document sets out a number of roles that ministers do play in relation to bringing forward Scottish statutory instruments—I can never say that—to put in place various regulations around our fees and things like that, and the legislation within which we operate. Once that is in place, the day-to-day operation is not subject to ministerial direction? A non-ministerial body is quite unusual. How many are there in Scotland? Are you aware of how many? I do not know exactly how many there are in Scotland. There are a few, and all the ones that there are have a similar arrangement to us in that they are making decisions where it would be inappropriate for ministers to have direct involvement in those decisions. The separation of policy. Ministers are responsible for policy and you are responsible for day-to-day operation. Surely the two should be combined rather than being separate? Are there any issues that you think have been problems because they have not been combined? I do not think so. I think that the independence that we have—for example, one of the things that we deal with quite a bit is people corresponding with us about the registration of their property, about exactly where their boundaries are. I think that it is appropriate that ministers are not directly involved in those decisions and that I am making those decisions looking at the legal basis that people are writing to me on, looking at what the law says and making that decision in accordance with the legislation that is in operation and not subject to any kind of other influences in relation to that. Clearly, as an organisation, we support the delivery of policy objectives. Obviously our big thing at the moment, completing the land register, is something that we are working towards, but the actual practicalities of how we are doing that is something that is within our gift to determine. Surely having policy alignment with how you implement something is a good thing because you ensure that the policy actually happens. How do you ensure that alignment happens if ministers are not jointly accountable for both areas? I will use land register completion as an example. We keep ministers informed of the progress that we are making. We would raise any issues that we were experiencing if we felt that any kind of legislative input was needed in order to support the delivery of a policy. Clearly we would raise that to ministers, but the actual day-to-day operation of making sure that we are delivering the policy is something that I do not think that we have any problem with moving forward on a day-to-day basis on our own. Let me turn to accountability because you may be aware that some of your colleagues at a UK level have been criticised as being part of non-ministerial departments and their lack of accountability to Parliament in practice. I want to explore with you how you have been accountable to this Parliament. I have to confess that this is the first time that I have seen you appear at a committee. If you would like to sponsor the committee, that is it. I am unclear how you ensure that accountability happens. I am delighted to be here today. I am relatively new in the role that I have been a keeper since April last year. I would happily come to committee as often as I have been invited. We have input into other committees. I appeared in front of the ECLA committee at the end of last year around the regulations that are being brought in to do the register of controlling interests. Outside of formal events like this, there is clearly accountability to individual members of the Scottish Parliament. We deal with a large amount of correspondence through my office, where MSPs can clearly write to us if anything is being raised with their constituents. We obviously answer parliamentary questions as and when they are risen. I would be happy to do more. It is one of the things since coming into the role. I have been very keen to make sure that what my organisation is doing is being held to account. If I may say, broader accountability to the Scottish public and to the customers is something that I have been pushing forward, making sure that the people who use our services are able to challenge us on whether we are doing it well enough and we are answerable for anything that is not going as well as it should be doing. I am happy to do as much as we are invited to do. How do you do that? Lawyers, I suspect, are the people who use your services the most. How do you ensure that you are accountable to them? If they were to give you a score out of 10, what would you think they would give you? I am telling you exactly what they would give us because we do a customer satisfaction survey. Our customer satisfaction is currently at 62 per cent in the questionnaire that goes out asks people for how satisfied they are with various aspects of our service. We have service standards and we publish regularly how we are performing against those in relation to the various services that we offer. I also, on a more informal basis, do a monthly newsletter out to anyone who has signed up to it. We have about 20,000 recipients of that, so not just solicitors but also members of the public, which gives an update on how various things we have been working on are coming in. I have also just completed a three-month tour around Scotland to make sure that we are getting out and talking to our customers wherever they are, rather than in terms of that face-to-face contact relying on them having the means to come and see us here in Edinburgh or in our offices in Glasgow. We also deal with an awful lot of correspondence directly with our customers. I run a customer services centre. They get many, many phone calls and letters every day with people asking for updates on various individual cases. All of that adds up to a transparent approach around how we are performing as a business and answering any questions about the degree to which we are providing the service that our customers expect. I will allow other members of the committee to develop particular detail. You referenced letters and PQs from MSPs as part of that accountability piece. I wonder—perhaps you do not have the information here, but you could provide it to us—how many letters you received from MSPs in a year, how many PQs, probably aside from my colleague sitting to my right, you get asked in any given year because, by your account, you have attended one committee in a year. That information would be helpful to us, convener. I can provide the absolute detail, if you do not mind, offline. Typically, we are responding to between one and five pieces of MSP correspondence each week. It just depends, I think, on the week. In the last year, since I have been in, we have probably dealt with about 10 PQs, but I would like to go back and provide the exact detail, if I may. If you could also—the customer satisfaction rating of 62 per cent is that of all customers or of those who respond? If so, what percentage would you respond to the survey in terms of customer satisfaction? If you could provide us with the detail of where that figure comes from as well, I can certainly provide more detail. That is 400 customers. That is the sample that we have used to come up with that number, but we can certainly provide more detail on how that number is to come up with how many people we have actually asked for the input versus how many we responded. I would like to take that offline, if I may. Also, the percentage that is of the total customer base. Thank you. Andy Wightman. Thank you very much and thank you for coming this morning. I am just filling up Jackie's question about accountability. I am interested in the fact that Scottish ministers set a target to complete the land register for public land in 2019 and by 24 for the rest. Your framework document sets out in paragraph 15, your framework document of July 2018, sets out the role of Scottish ministers to prescribe by SSIs, to make SSIs to the consent of the Lord President, to appoint yourself, etc. You said in your opening remarks that ministers do not direct us. Under what authority do ministers require you to complete the land register by 2019 for public land and 2024 for everything else? There has been no legislation around that. Part of what we are doing anyway is moving towards completing the land register. I am a firm believer that a target is a good thing, it incentivises everyone involved to pull out all the stops, to try and make something happen in the most realistic timeframe possible, but that direction, which predates me, is not something that there has been legislation for. We are working as hard as we can to meet that target. One observation that I would like to make about the target is that it is clearly not completely within registers of Scotland gift. The completion of the land register requires lots of organisations to submit information to us. Ministers do not have ability in most cases to direct those organisations either, so it is a sort of collective effort to work towards meeting that target. We are doing everything we can to fulfil our part of that. It suits us as an organisation to reach a point where we have a complete land register. It will allow us to change some of our operations in terms of the types of cases that we are handling. It is in our interests to try and get there as quickly as possible. It is fairly helpful to us that ministers set out that aspiration. It has given us the licence to go out and have some conversations with organisations, particularly around voluntary registration, which was something that was not really happening in any great scale prior to that target being set, to go and have conversations with some of the large landowners about the voluntary registration process and encourage them to accelerate coming on to the land register. I think that for a number of those landowners, that has been something that they have been willing to do. It suits them to get their land registered out of the Saisine register and on to the land register. For all parties involved, it has been quite helpful to have a goal rather than something that was just rumbling on and taking its time. I think that goals are useful. It is worth noting during the passage of the Land Registration Act 2012 that the Government, as I recall, in front of the committee's predecessor, rejected amendments to set targets in primary legislation. The target to register all publicly land is to be complete by 2019, so, as you are aware, that is 2019. The Environment, Climate Change and Land Reform Committee recently wrote to all of Scotland's public authorities, or a large number of them, to ask how they were getting on. The City of Edinburgh Council said that it is not likely that it will be completed by 2019. It says that the council has neither the resources nor the budget to accomplish a task in the envisaged timescale, and it also says that the council understands that all other local authorities in Scotland would be faced with a similar scale of task to complete registration of the land by 2019. Stirling Council says that the council will not complete the registration by 2019. Aberdeen City Council says that it is not able to do it. We have no resources available, etc. It says that a meeting was held with yourself, the Registration of Scotland's voluntary registration team. Aberdeen City, Aberdeenshire, Murray and Angus on 8 December 2016 similar concerns were raised in 2016. The bottom line is that there is no way councils are going to meet this target. They have not met this target. So, what correspondence was had with the Government in 2016 about the failure to meet this target, and who is accountable for that failure? Perhaps it would be useful if I gave an update on where we are with the 2019 target. I think that you rightly identify something that we have known ever since the target was set, which is that the parties involved, the people who own the land and us, have to come together to fulfil the registration process. It is not something that we can unilaterally do. We have been working hard with all the public bodies to support them to do two things. The voluntary registration piece that you call out, which is where an owner of land would need to provide us with a bunch of information and pay for the registration to happen. One of the things that came in, you will be aware in the 2012 act, was keeper-induced registration, where, if the body provides me with the information, I can undertake the registration without charging a fee for that. However, it still requires the body to provide information. So, with a number of the public bodies, we are being very successful in providing information to support keeper-induced registration, particularly public bodies who own housing association properties that support us getting a large number of titles on to the land register. The challenge, I think, for some of the public bodies is where they own large areas of land that they would need to provide us with all the information and voluntary register, as you rightly call out. They are saying that they have not got the resources. It is not true of every local authority. Some local authorities are able to do what is needed within the timescale. We have been, through regular updates to ministers, providing an update on how that land register completion is progressing, and not just the public stuff, but also the private stuff—how we are getting on there. I think that we are thinking now how else we can support local authorities who do not have the resources. We have also been focusing on the public bodies who own the biggest areas of land, in terms of land mass coverage. I would single out, as a particularly excellent organisation, we have been working with the Forestry Commission, who are absolutely going to hit the 2019 target. They are going to get all the land that they own registered with us, but we are going to have to work slightly more slowly through the public bodies who have not had the resources to do the work that they need to do to hit the target. Has any local authority intimated that they will hit the target? I believe that yes. Off the top of my head, I cannot recall which ones are going to have finished the job this year, but some of them will have done. Highland Council is saying that a conservative estimate would be £8.5 million to do it. What assessment was made in 2014 of the feasibility of achieving this target and what the pathways would be? I appreciate that you went in post then, but it would be useful if there was any correspondence or any evaluation that you made. That cuts to the heart of the question of accountability. You are a self-funding organisation, so it would be interesting to know what assessment you made of the request that was being made by Scottish ministers, which you acceded to and did not in any way kick back on. I would respond, and Janet will potentially be able to pick up, because she has obviously been in post longer than me. There are very much two parts to the registration process for completing the land register. There is the work that the body owning the land needs to do, which involves quite a large amount of legal work in order to pull together all their deeds, make sure that they have an accurate plan of what they own, and provide that information to us for registration. We are completely comfortable internally within Registers of Scotland that we have the relevant amount of resource to register all the land if it comes to us over the next five-year period. We are absolutely resource to do that if we need to. We have been working on ways of automating some of those processes, so it is not such a manpower-intensive piece. The assessments that were done at the time when the target was set were that, yes, it would be a big effort, but we could do the job that was required of us. That is why it is particularly important to emphasise around the voluntary registration piece. We cannot afford to do keeper-induced registration for everything for free, because clearly I have to pay staff to be there doing the work, so we can do a certain amount of keeper-induced registration where we can put a large number of titles on in one go for relatively little amounts of effort from my staff, but for the big, complex pieces of land it is a very manpower-intensive process for me, and therefore I need to be funded to do it. We were comfortable internally that we could do the job. I am not cited on what correspondence has with all the public bodies who were going to have to do their part of the bargain, and therefore what was said at the time about how much they felt or not it was possible to do that, but all I can say is from Registers of Scotland's point of view we have been pulling out all the stops to do everything we can do to move as fast towards the target. We are making some very encouraging progress, so currently in the building at the moment what we are working on is another 16% of landmass, so if we can get that completed in the near future that will be a significant step forward in terms of the landmass coverage of Scotland, and the final thing I wanted to say around that is we are also thinking about one of the challenges that the owners of property have is not only do they have to get the map of what they own, but they then have to get all the legal deeds to sort of back up their ownership. Clearly around making policy decisions around land ownership and potential land reform, the map is the most useful thing, and so we are working to pull together what we are going to call a pre-registration layer, so when bodies have got their maps together they send them in, so we will build up that map of Scotland to a reasonable degree of certainty who owns everything, it will obviously need to progress to registration to actually get to the point of being able to say yes, the boundary is exactly there, but we feel that that interim step will be quite a useful step for some of the decisions that we know a complete land register is intended to support. So you are saying that you were comfortable that you could do your bit of the bargain. I mean it sounds like there was no consultation at all with the public bodies, some of whom own land, I mean Perth is 800 years old, there's a lot of land that's not even on the register of say scenes, they're not even Latin deeds, they're lost. Okay thanks, I've a few more questions but I'll come back later. Tom Mason. Yes, I mean really welcome. I want to extend your conversation in terms of alternative methods of land access and view, taking a much more scientific approach with aerial photography and so on. I mean how far are you progressing on that now? Well it might not be legal in the end of the day. Is that part of your interim process or do you need to go further than the general perspective and you're actually going into legal detail? So we've introduced aerial photography recently as one of the layers on our scotless system because that's something that people have said is useful when they're trying to understand aspects of where boundaries sit and things like that. I mean I think it's important to emphasise that the legal basis on which someone can assert that they own a piece of land is when it is on the land register, also on the Saisian register but clearly we're transferring that across and that actually the boundaries have to be mapped to the degree of accuracy of the underlying ordinance survey map. So the actual legal basis on which people will be able to transact on land will always be about absolutely completing their title on the land register but I think we fully recognise within Registers of Scotland that to support some of the wider debate around land ownership and land reform you could have a more aggregate level view of what people own and what concentration of land there is and things like that to inform some of those decisions and it doesn't need to be at the level of accuracy that the actual registration would give you but I'm not sure that answers your question. Well just that I mean it's unlikely that you're ever going to achieve 100% registration I would suggest in the end of the day. I mean that's an impossible task because there'll always be some wall or a bit of land which is not there and most of the problems are in fact not in the land mass itself but in the detail around the edges, fights over who owns what and so on. Well in fact in the end of the day the alternative methods of viewing the land contribute to our solving that or is it always going to be down to the legal detail and physical measure if you like? Well I think I mean again in terms of correspondence that comes through my office the biggest correspondence we see from MSPs and others is sort of helping neighbours sort out boundary disputes and that is always going to come down to the legal detail about exactly where someone's boundary sits and you know are people satisfied that their fence is in the place that actually the boundary is and I don't think there's anything we can do to get away with that. I think the alternative ways of viewing land ownership in Scotland will allow us to see something about concentration of land ownership, how much land in particular area is owned by what type of body but if you're ever going to get down to the boundaries it's going to be about the specific legal registration and that's something we're going to continue to need to do so that people can transact safely on their land. But in terms of the overall target as I say I don't think you're ever going to get to 100% what figured you would you be satisfied to getting to within the time scale you've been allowed? I think I think I mean we use a phrase called functional completion so you are right you are going to end up with a situation where I mean they take a very simple example someone registers the land they own we draw the map someone registers the neighbouring property we draw the map if those two maps parts don't exactly join up there's a little slither of land in the middle which it's not clear who owns that. Some very learned lawyers are currently debating what's going to be the best way to deal with all those little parts of the map once we know where they all are but I mean we'll get to the high 90s I mean subject to Mr Whiteman's sort of questions about the ability of bodies to provide us with information we'll get to the high 90s in terms of what people can absolutely assert they own and provide us with the relevant deeds it'll just be all those little bits of land that over the years it's been lost who is the owner of those that they'll need to be a decision about what needs to happen in terms of getting those registered and something so that people can use them appropriately. When you say high 90s 98% I think so okay commit to that I commit to that from the point of view of subject to people providing us with the information we need I mean I can I can tell you why I have that level of confidence so we have internally a sort of target set that says every single month what land mass do we need to be adding to the register and what number of titles do we need to be adding to the register and if you draw the line out to the end of 2024 currently we are on that target so at the moment we're getting the volume of business coming in that actually allows us to work through the work get things on the land register but I think as I say in response to Mr Watten's question it relies on people continuing to be able to flow that information to us and we work very hard our voluntary registration team work extremely hard to get out and keep that work coming but we can't predict that we won't run to the point where people start saying I'm not interested in participating in this process I'm not going to send you the information and we at that point won't be able to register their land what we will be able to do at that point is as I've described this preregistration layer say well we think we know who owns that land the fact that they haven't been able to provide us with the deeds and they're not interested in participating in voluntary registration we could mark on a preregistration layer that we provisionally expect eventually that land will end up being registered to x and that I think will be a helpful thing to be able to provide so the register of say scenes would remain as for the two percent or would you hope that some decision would be taken about these other bits of land so that that could be closed and it would all be on the land register or what's your my ambition will be so my ambition will be to reach point where we can close the register of say scenes I think every register we have clearly costs us time money and effort to keep open so not being able to fully close the register of say scenes would be a good thing so I think it will be something we need to work on over the next few years to agree what will be the position for all those little parts of land that are not registered on the land register by 2024 and but that will be a law position it will be something that the law society of Scotland and people like that would need to be involved in discussing well what might be on the law commission what might be the appropriate way of legally dealing with that if there is no legal solution we'll keep the register of say scenes open for as long as it needs to be kept open while there is legally registered land in it thank you andy whiteman did you have another question yes just back to another sort of policy initiative and this is the the scotless project which I think was first talked about in the 1990s and this relates again to questions of you know accountability and direction etc so John Swinney asked you in july 25 to create what was called scotless Scottish land information service and I quote the purpose of scotless is to enable users to access quickly and easily information about any piece of land of property in Scotland through a single online inquiry and the terms of reference that were set at the time by the registers of Scotland aimed to get the first wave data sets in place by October 2017 so for a solicitor for example this would include registers of Scotland's own data on inhibitions and land register planning a contaminated land drainage listed buildings information from companies house our public rights of way utilities energy performance etc and for the public it included school catchment areas local healthcare council tax bans planning consent etc by 2017 you had published something and I have a I'm looking at it now and it doesn't do any of these things apart from your own data so again why was that not complete by 2017 and who's really accountable and in charge of taking that further forward so I will I mean I guess I'll set out what we've been seeking to achieve with scotless so the purpose of scotless is two purposes as far as I'm concerned the first one is to support solicitors in fulfilling their conveyancing role we were operating an old system within registers of Scotland called registers direct which had been in place for quite a long time and that fundamentally enabled solicitors to access the most fundamental thing they need in the conveyancing process which is the title information so our first priority when we launched scotless was to get the title information moved across we are working and we've worked in the last year we then spoke to solicitors and said well what do you want next and they said well the next thing we want is all your other registers so that's been the progress since we launched scotless in october 2017 to add all of our other registers in I think it's really important to emphasise with scotless that it's a system that's constantly evolving so the feedback that solicitors can provide and we are constantly like every week there are multiple updates subtle updates to the system where solicitors get hold of us through the feedback form and they go oh it'd be great if we could zoom on the map in this way or it'd be great if I could pull the information off in this way so we've very much been user led in the last year in how we've developed the system to say to solicitors we'll do what you need in order to make it useful to you the other half of where we're trying to go with the system is around the citizen because I think it's extremely important that we think about how our information is available to the citizen and again we want to be user led so we've been running citizen workshops to understand with citizens what would they like scotless to be and in the coming couple of months we're going to be rolling out a new citizen version of scotless that responds to their requests about what kind of information do they want to access and how might we build up those information layers I think dealing with your question about other types of information we have been looking at that so for example we looked at the coal authority to say how could we pull coal authority data into scotless we've encountered some challenges around the resolution of the coal authority data and how it does or doesn't fit with scotless and actually we've chosen at the moment to say it's not the priority to get that information on we'd rather keep on working to respond to what solicitors and now the citizen need in terms of giving them something that's most useful to them I've definitely got aspirations to keep building layers on to scotless but I don't see any point in putting stuff on there when there isn't yet a user need defined to do it. The user need was defined in the in the first wave data in the terms of reference and this was stimulated by as I understand it the experience in Norway of their land information portal I think Norway is number five in the in the world banks doing business ranking the UK is 42nd, Georgia is number four, Armenia is 14, Moldova is 22 you know I'm online looking at 150 different bits of information in the state of Montana in the US I mean at my understanding was that scotless was to be a a portal to provide the kind of data that we're talking about here rights of way utilities planning etc so I'm just seeking understand okay this hasn't been achieved by the target date again but why is registered of scotland in charge of this because you speak you're talking about almost as if you're just speaking to solicitors I mean I have constituents who want to find out who owns flats in their tenement because their short term lets and they're having problems I mean not only across them 30 pounds so that's 180 pounds and they can't afford it but they want to find all sorts of other information about for example does it have planning consent as a short term let are they paying non-domestic rates so the idea of scotless understood it was a one-stop shop where you could go and find that information that strikes me is that it should be a system whose development is governed by a broad board across the public sector including the Scottish Assessor, COSLA, Scottish Water and various others I mean you're implying that basically you you're running this and you will develop it according to what you perceive your customers want is that correct or is there a a broader board that's taking some kind of governance role about developing it it's not a broader board I mean we are developing it and we are funding the development of it I would be delighted if other organisations wanted to co-fund it with us but at the moment it's something that only registers as Scotland is putting money into I just pick up if I may on your point about the citizen 100% agree that we want to build a system that gives the citizen useful information one of the things that we're going to be able to do very soon I hope within the next quarter is enable the citizen to download their title sheet through scotless for the same three pound charge that a solicitor currently pays so I think that will improve things for people being able to find out that information about who owns the properties around them for a much lower cost than at the moment we can only offer a service where they have to call up our customer services centre or come into the offices in person that then incurs time and effort from my staff to go and find that information which is why there's currently a higher charge so I think that will be good progress to be able to offer the citizen the same price as a business user would currently offer but then I think the citizen panels that we're currently running are about understanding what else does the citizen need one of the pieces of feedback we've had which I know it was also picked up in the towards transparency and land ownership report by community land Scotland was about the challenge of the average citizen understanding the very legalistic information that's provided with the title certificate so we've been working with a citizen panel to think about how can we provide an appropriate explanation so that when a citizen pays the three pounds and downloads the title sheet that's looking at their neighbour's property they actually can understand what it's telling them without hopefully having to go and consult a lawyer and again for me that's a greater priority than adding in other layers of information I'd rather get some of the basics in place first and I'd certainly be as I said be delighted if other organisations wanted to come in and co-fund but that hasn't been something that people have been showing an interest in to date so we're working as hard as we can within what we can do to move the system forward. It's at the heart of my question which is you know who is governing this and you say no one else wants to come in but that's presumably because no one realises that they could come in if they want I mean as things stand the project is complete as far as John Swinney was concerned in the Scottish Government but there doesn't seem to be any lead in taking it any further forward. I mean you mentioned the citizen being able to pay three pounds I mean it's always been a curiosity to me that solicitors and people with money get it for tenth of the price of the ordinary citizen and I mean Denmark for example has developed a free-to-use model and evaluated the economic impact assessment of that as being worth £800 million to the economy as a compared to a pay-to-use model at the moment. I mean you mentioned that you're intending to roll this out so that the citizen can access you said at the beginning their own title but then you talked about titles around them so any title. Any title yeah in this I mean we're a public register so as citizen. So you would need you'd need a new fee order for that? No we wouldn't need a new fee order scotless the fees we charge for scotless are not subject to our fee order the fee order prescribes the cost of people accessing our information via phoning our customer services or coming in in person I think it's good news that by building out a digital system we're able to provide it at a much lower cost than that so we wouldn't need a new fee order for that. Understanding is you need a fee order I mean years ago I was accessing information for free on the basis of a research research needs Audit Scotland told you that you had no legal authority to provide free access because you could only provide access based on what was in the fee order so I'm a little bit surprised you're saying that you can make up the rules for scotless out with the fee order? Because scotless is not a statutory service so the fee order applies to the statutory services we provide. But once you get in through scotless you're getting to land register titles? That's correct. So at that point the fee order surely governs the price being paid? It doesn't because the fee order covers us our mandatory requirement our statutory requirement is to provide access to the register through a customer services centre or people coming in in person. We are I think in a good position of being able to provide an alternative way of doing that and do that a way that's more economic for the user but that is not a statutory service scotless is not a statutory service. You could make that free if you wished. In theory we could make it free in practice that would not be practical for us because building and developing scotless is costing us a substantial amount of money and therefore in order to fund that service to keep that service up to date we have to charge a price for the information access. So you're saying scotless is costing you a lot of money it was government that wanted you to do that? Who's accountable for spending all that money developing a system that wasn't at your initiatives or government's initiatives and has understanding that government put no money into this? The government has put no money into this we are self-funding it which is why we're recovering our costs by charging for the information that's probably I think it's also worth saying we do provide a certain amount of information that is free for scotless that people can access some of the information for free but we are charging for people to access the title sheet. I mean Janet is obviously in charge of all the sort of finance side of things so I'm sure could go into that in a lot more detail offline if it's something you want to explore with us more. Okay thanks. Thank you Colin Beattie. I'd like to have a little look at the digital services and maybe starting looking at the historical side. Back in 2011-12 I was serving at that time in the public then public audit committee and there was a tremendous problem with your IT and the BT contract that went with that. What lessons have you learned from that that you're implementing now? So we are no longer with BT as I'm sure you're aware we are doing our digital services as an in-house thing at the moment which I think gives us much more control over being more dynamic in responding. I mean I think we've got a big programme of digital activity working forward at the moment there's a sort of externally facing piece around the provision of digital services to our customers. There's an awful lot of internal work we're doing around enhancing our internal tooling digitally and then we're doing some absolutely fantastic work around the resilience of our services making sure we've got good disaster recovery. We're a 24-7 operation in terms of making sure that our services are up and running for anyone that wants to use them at any point of the day or night and making sure that we can recover if there's a power outage instantly is a big priority for us at the moment. So I think the lessons we've learned are about how we specify what we need to make sure that we've got controlling it effectively. Again Janet from a sort of accountability officer point of view could pick up on that. Yes I mean in a way I think what we've done we've learned that we need to resource in quite a different way for digital and we've tried lots of different mix of resources what we'd love is to have people on our payroll who are digital experts. We can't get enough of those at civil service pay rates and so we've always had a bit of a mix of resource coming from contractors from some companies where we've got bespoke pieces of work that we can give to a particular company to do and in-house but absolutely that lesson we learned that outsourcing all of our intelligent client capability didn't work for us under a long-term contract so we brought that in. I think what we've really learned is to be just a lot more flexible over the last few years so we've done a lot of transformation in different ways and some of it's about the tech but a lot of it's about getting the tech ready with the processes with the people and it's that mix that actually delivers for us so we've put a lot of effort into that just picking up on the kind of scotless how we've developed it and it is different from what we originally put in the original business case and I think that kind of that has worked from my point of view with my accountability hat on and you know to get value for money we need to keep listening and not think that our original idea is always was right we actually with scotless was a really good example of then when we went out to more users we got quite different feedback and so we've taken it a bit more slowly and we've done something similar recently with our digital securities service we've we've got a really good digital discharge service in place now that has is working very fast between lenders and solicitors and ourselves and where we used to have deeds floating by post and it would take several weeks to get something discharged now you can do it within minutes and everybody can get on the same online system so that's worked much more effectively for us and we thought we would go on from that to develop a digital security service and we've talked to the lenders and we've talked to the solicitors who would be using it and they're not ready for it they're not ready for the signature digital signatures that would sit behind that they're not ready to to actually take that it's for them it's a it's a level of risk that they're not ready for and so rather than just push ahead with that we've kind of learned I think over these last few years we've learned to really listen to that and go okay we sometimes we need to slow down or stop and actually yeah take our users with us take it that having brought everything in house all your development is now in house all the systems that you're developing is done by your own staff or contractors yes and occasionally we use we use some professional service companies as well where we can where it's a discrete piece of work but mostly we're using contractors and we're trying to use our contractors also to kind of body up with some of our in-house people and so we're kind of growing growing our own through that process as well but if if you're doing everything in house obviously you're a bit isolated in what you're doing how do you I mean there must be systems off the shelf that you can bring in house and adapt to your own needs surely you're not developing everything from scratch yes you're quite right I don't mean where we're not buying off the shelf services but the configuration in house so we've for example put in place a case management system that we're using so we can use digital case bags go around the business rather than physical paper case bags and and that is an off the shelf off the shelf system that we have just the work for us has been adapting it to our own our own needs now you've touched on the fact it's quite difficult to get to it specialists and that's that's been so across the whole of the public sector um do you offer any incentives to be able to attract these people in I'm not going to speak to that I mean I think one of our aspirations as an organisation is to make ourselves an employer of choice where if someone is thinking about a career in the civil service registers of Scotland is somewhere they want to come and work the feedback we've had from some of our in-house digital folks is the work we're doing is exciting it's exciting to be building the kind of digital services we're offering we're innovating in the way we do it there's a lot of customer contact so and I think therefore we're an attractive place for people to come and work we don't offer any other incentives in terms of you know civil service terms and conditions are standard so we think the thing we need to make sure we do is that people want to come and work for us because the work is going to really develop them and give them new skills and give them the opportunity to do something that they wouldn't otherwise get a chance to do elsewhere in the civil service I think the other thing that I find very comforting that our people say to us is there's a public service ethos you know people want to come and work for us because they feel the job we do matters it makes a difference to the country and that that's an incentive for them to come and apply their skills in-house with us rather than out and about in the wider private sector now in the light of difficulties elsewhere with the IT projects the Scottish government set up a unit and I can't remember the official name for it but basically to provide the skills project management skills that you know individual departments and so on perhaps don't have internally do you make use of that service or do you work separately from that so we work regularly I mean the digital director I have a regular catch-up with him to kind of make sure that what we're doing internally within registers of Scotland is fitting in with the you know other things that are going on we've made use of the assessment process where the they can send in people to kind of go over your digital plans and make sure that you're working in accordance with best practice we follow the standards in terms of the government digital standards and things like that so we are absolutely not doing our own thing off in isolation we are doing best practice and joining up with other parts of the Scottish government where appropriate to share knowledge share skills and share ideas about how to approach things and some of our people offer their services as assessors out to other parts of the Scottish government because I think we're recognised as doing some quite leading edge work and therefore there's a feeling that our people could offer something to other parts of the Scottish government in terms of reviewing their programmes and providing advice on where they could improve how they approach digital projects you're reckoning to be fully digital by 2020 but the other side of the coin is what you're doing to make sure that your customers are fully digital otherwise it's not too effective and I think as Janet's already said that's the interesting challenge so we when we ran the consultation about our proposed rollout of digital services for the customer facing part there was a lot of appetite from our customers to bring in digital securities and a kind of digital disposition service we've rolled out the digital discharge it's very successful but we still don't have all of the lenders signed up to it so the lenders are gradually coming on board but we obviously can't make lenders sign up to that process they have to do some potentially large changes to some of their IT systems to fit in with the new system so that's happening I think when we started to talk to customers about the practical realities of what a digital security system would mean they realised as Janet said that some of the ways of their working weren't going to quite fit with that so we're exploring with them how we can build a system that suits us that still supports them in doing their work because it's clearly of no gain to us if we bring in a system that actually our customers can't use and just slows them down and slows the convincing process down I think digital discharge has been an exemplar in terms of by working closely with our customers throughout we've brought in something that allows them to work much faster than they used to work and we've factored in a way of how we deal with the lenders who aren't yet on the system so that our customers can still work faster even in those cases but realistically are you and the customers going to be ready by 2020? So I think the 2020 target really relates to two things it relates to bringing in services for our customers when now we are not going to have fully brought in a digital security and a digital disposition service by 2020 because our customers are not ready to work in the fully digital way we will have absolutely made advances in terms of some elements of them working digitally with us but to be fully digital I don't think we will have got there by 2020 the other half of our digital programme is the internal staff where the tools we provide our people internally to do parts of their job we are constantly bringing in so I can give you an example so we used to have a very manual process when a paper application arrived with us getting that piece of paper onto our system one of the internal tools we brought in just before Christmas was an automated way of doing that so the paper comes in goes through our scanners the application is automatically created digitally on our record that is a massive step forward for us internally in terms of not having people having to retype in information from bits of paper that are arriving in the post long-term goal definitely will be where there's no post coming into the building solicitors are filling in everything at their end pressing a button and it automatically comes through to us but there's some bigger challenges with that around digital signatures and things that need to be overcome before we could reach that point. Thank you convener good morning to the panel I'm one of these MSPs that's been in correspondence with you recently but my first question relates to the registration processing times now there is a backlog of applications for registration suggesting that despite reassurances that the keeper gave to the legal profession in June the backlog is growing and not decreasing so you know July around 43,000 cases missed at the end of the month increased to 45,000 in August 46,000 in September last year 47 odd thousand in October 49,000 in November and 51,000 odd at the end of the year and I wonder if you can explain why that is and what you're doing to address it absolutely so I think the first thing to say is so I arrived last April one of the things I picked up on very quickly was that we had some types of work where we weren't operating within our service standard I think it's worth saying for the vast majority of what we deal with we do operate within service standard 91% of everything we deal with goes out within 20 working days but we did absolutely have certain types of cases so first registrations and transfers apart where we weren't hitting our service standards lots of conversations with myself and others on the registration staff to understand why we'd got there and that's certainly something I can explain how we'd come to have the problem the next question is obviously what are we going to do to fix it the feeling was that we needed to do two things we needed to stabilise and actually to stabilise it was going to get slightly worse before it started to get better so I asked the registration staff to do me a forecast of at what point they thought they would stabilise it is about now and we've now had two weeks of achieving stability so I'm waiting to confirm that actually that the number and both but what I mean by stability is that the number of cases going out the door is greater than the number of cases coming in the door because quite clearly if you're achieving that your backlog will start to go away so we always knew it was going to take us six months to stabilise so the rate at which the area was growing slowing it down slowing it down until we could turn it round that's required different ways of working it's required some innovation from the registration staff about how they deal with the complex case work the other thing we were doing in parallel to that is we were trying to bring in the age because the biggest issue we were getting from solicitors calling us up was the cases that we'd had for more than two years so we were saying right the priority is stabilise but also get rid of all the 2016 cases so we're putting an awful lot of effort into working through those oldest and therefore most the reason they were the oldest is because they were most complicated so forgive me for interrupting but do you have a breakdown of cases that are woefully overdue you know in the two-year bracket cases that are a year overdue and cases that are you know six months yeah it's something we review very regularly so at the last look we had just over 4 000 cases left with us from that uh two years old um we are expecting to get rid of those in the next sort of couple of months I think one of the things that's worth saying is that there are cases that are going to be very complicated and we will have to work with the submitting solicitor because actually what they've sent us doesn't allow us to complete the registration process straight off so one of the things we brought in as a policy change was to say well we've had a case for more than three months we won't reject it which we are entitled to do if the case has any flaws in it at all we're entitled to reject it under the 2012 legislation but we thought clearly that's not helpful so taking a policy change that says we won't reject staff unless it's got a fatal flaw we'll work with the submitting solicitor to try and get what we need in order to complete the registration process okay so how long is it going to take you to clear the backlog so with our current level of staffing to get everything back within service standard using our current approaches it could take us up to another 18 months but we are working on new innovation in terms of ways of working so we might be able to do it in 12 months if we choose to boost our staff we could do it more quickly than that I think the thing we're reflecting on is what the necessity is to clear the backlog I mean clear it's not acceptable that we have a backlog of cases but in terms of the practical difference it makes to people who have their properties it doesn't cause them issues almost in almost every case it doesn't cause people issues that their case hasn't been registered from a legal standpoint we take their case on on the day we receive it and the application their registration is when it happens is backdated to that date we introduced an expedite process so anyone who is experiencing any difference difficulties can get their case accelerated so the legal profession are telling us that there's no great rush to clear the backlog provided we continue to not reject and we're provided we continue to have an expedite policy so those small number of cases that need accelerating can be accelerated I'm kidding you move on so it's 18 months what worst case scenario forgive me I'm just I'm conscious of time I've got a few other issues I want to raise you spoke earlier about you know some of the issues that you'll be dealing around with boundary disputes I'm sure every MSP here over the years has written to you in some regard with us but can I just what I want to focus on is some processes so the register of Scotland regularly receives map updates from ordinance survey is it the case that you're obliged to use the most up-to-date version of os maps as the base map yes that is correct yeah okay therefore would you proactively advise land owners if there is a change to that base map we wouldn't so our map based maintenance people when the map tile is updated they look at any titles that sit on top of that map tile and if they so I don't know if there's a boundary shown on the map tile and when the map tile is updated the property boundary no longer sits on top of the map tile boundary we would make that adjustment because we would say well that's clearly where it's meant to be it doesn't materially change anything for the property owner there's nothing to notify them about if there was something more significant we would correspond with the property owner if we felt that we couldn't make the change to reflect the base map that showed you know showed their property boundary in the in the correct place but we'd have to take those on a case-by-case basis we certainly don't routinely notify people when we're making minor adjustments okay but there is an assessment process that you undertake every time the base map is updated where you're evaluating whether or not that has an impact on title deeds yeah because we have a team of people a small team who are physically looking at that updated map tile and saying what does that do to the properties that sit on top of it do they now all look slightly skew if relative to the underlying base map and do we need to make that adjustment or actually no they don't and therefore there's no adjustment to make I think the other thing I would say is audit survey senders 400 updated map tiles every week we don't get to all 400 in the week so sometimes we are running at a bit of a lag and again we would deal with those if it's brought to our attention that someone is trying to transact on a property that sits on top of one of those map tiles that hasn't yet been updated and that would be where that map tile would go to the front of the queue but again very happy to kind of explore that in more detail can you see the problem that if you know the base map has been changed some years previously and then you know somebody goes to sell their house and they then discover that the title deeds in the base map is out of sync that would be the point at which we would update the base map and if we hadn't reached that map tile that would be the point at which we would make that adjustment and it it should never make a material difference to where someone's boundary sits I mean the the deed that was used to register someone's property will just have described and the map was originally drawn would have described that you know the eastern boundary is against the fence line if the map tile updates and shows the fence line now is a little bit further over than where it was because of ordinance survey surveying techniques it's still appropriate for us to align their property boundary to them to the fence line the only time we wouldn't do that is if the fence line in the new survey has moved by meters and meters and meters and we would say well maybe this is a new fence maybe something strange has happened here and then we would need to make sure that we were accurately drawing the property boundary on top and not suddenly allocating people new land that wasn't theirs okay I'll probably come back to you and reflect on your evidence and come back to you about this can you confirm whether or not registers of Scotland is subject to the gender representation on public boards act oh my goodness I don't know the answer to that we certainly meet it I'm sure we're 50 50 but um I don't know whether you don't know where in the yeah I'm saying I don't know goodness right well that's a wee bit worrying whether you're whether you're subject to it or not you don't know okay um tell me about the diversity on your board then you know what size is your board how many are men how many are women so my board has four non executives directors three are women one is a man and then the executive members it's two women and two men so we're as close to 50 50 as you can be I suppose if we had one more male non executive director would be exactly 50 50 okay and your risk and audit committee so this is three women and one man okay and just as a matter of interest your workforce overall almost exactly 50 50 I think we have very slightly more men than women overall but almost exactly 50 50 and our gender pay gap is 98 percent that wrong as in there's very little two percent I think it'll be the two percent or four percent it's in that boundary yes 98 percent of what men earn right okay so I could hear the two accountants with a sharp and take of breath yeah right okay and in terms of diversity and a broader sense in terms of people with disabilities you know in terms of people that are younger in terms of your overall workforce in terms of people from a bme background so it's information just pulling out we publish annually in our annual report um we've recently one of the things I asked for fairly shortly after I joined was a diversity update and that was looking at the diversity of the organisation versus the diversity of the population in Scotland to try and understand were there any aspects where our workforce didn't match the population I think one of the challenges we have as I think a number of organisations have with that is people's willingness to declare various diversity characteristics so our big push has been to actually try and get accurate data around that to make sure that we are helping people feel comfortable that declaring all those things that would allow us to do that analysis accurately and understand whether there's any issue we have an inclusion network in the organisation that is a grouping of staff have come together to champion inclusion issues and we've taken input from them about things we're setting up staff networks to champion various individual aspects of diversity but it's not something I feel from the evidence I've seen that we have any particular issue on in terms of our overall stats so I so so what are the numbers I mean around 20 the population live with a disability in some parts of Scotland to be community is as much as 12 percent although on average it's about 4 percent that is seven and a half percent to declared disabled in our last year's annual report so we've got a fuller equality mainstreaming report and similarly only one and a half percent have declared themselves as being from ethnic minority backgrounds okay and is that something you would like to improve we would certainly like to improve the reporting on it we're not sure that that is accurate of our and this is declared and we know that not we've actually done some work to improve our retention of the statistics because of course we gather a lot of statistics when we're recruiting and then we don't keep that for good reasons unless we've asked people may we do that when you so people think that they've declared already to the organisation but actually we're not holding that information so there is something around we would like to know the position better and we'd certainly like it to be representative yeah okay so I've read a little bit about your appointment process in terms to your various boards and you know it sounded fairly routine I suppose I would be interested to know a little bit more about how you as an employer seek to reach out and tap into a wide range of talents that exists particularly in groups that are underrepresented so with the most recent are you interested specifically in the board or generally in recruitment to the organisation well both okay so I'll start with the board and and the audit and risk committee so we advertise widely in a variety of different media so civil service appointments various public pieces of media we get a good number of people wishing to participate in the process we have representation from various different parts of the UK so our board come from not just Scotland we have people representing other parts of the UK and and indeed Ireland which is I think useful because we bring people with different experiences of working in different parts of the jurisdiction I don't really know what else to say in terms of how we reach out me we feel we advertise widely and we feel we get a good number of people the civil service commission came in recently and looked at our recent med recruitment process from the audit and risk committee and we're very satisfied that it had been done appropriately and met all the relevant requirements yeah I mean it all sounds very much if you don't mind me saying by the book but I'm very conscious that you know for example your advisory boards non executive members you know you're not regulated by the code of practice for ministerial appointments to public boards you know and so you know I'm wondering you know therefore where's the independent and external scrutiny and support for finding different ways and better ways to reach out to those that are perhaps you know a little less likely to be within the current civil servant loop well I think I mean our existing board members are absolutely a non execs are absolutely not all ex civil servants we have one of our non execs is an artist from Northern Ireland so you know she brings a very different perspective to the board she works with tech startups so I mean we have I feel we have got good representation on the board of people who come from different backgrounds and can give us good challenge and advice on the work that we're doing I don't feel we have a board of people who all bring a similar view and therefore we're not getting the breadth of input but then your statistics we show that you're not necessarily represent Scotland and all that's diversed in your broader workforce so I suppose I'm pressing you you know what what are you prepared to do that's a bit different as opposed to the same old same old so I feel quite strongly that the best way to get a diverse workforce is to show that you are an organisation that supports that workforce in terms of you know leading on thinking around things so for example in terms of the LBGT community in Ros really making sure that we're understanding that what we need to do to support them making sure we've got gender-neutral toilets making sure we've brought in a process for people who want to transition at work and I think showing that as an employer we are trying to do everything we can to be a supportive inclusive environment is going to be the best way for if people are looking at options for where they might want to come and work choosing to come and work with us because they feel we'll be an environment and an organisation that supports them in all that sort of diverse characteristics I don't I personally don't think it's right to just sort of reach out and try and bring people in without providing the right environment to support them when they get here and find a question convener can you tell us how many young people under the age of 25 you employ and how many modern apprentices you support off the top of my head I can't we certainly have supported the modern apprentice programme Janet's going to have a look and see if we've got it immediately to hand but I could come back to you on that I think that when we did our look at the diversity of the workforce in terms of the sort of spread of age bands across the organisation we had a good spread in terms of young medium and more mature people and certainly modern apprentices have been a very successful thing for us in terms of people coming in participating in that programme and then choosing to stay on and make a career within register Scotland but we're very happy to come back offline with the specific numbers on that yes I can't directly answer that one but I was noting that we had managed to our under 30s back in 2014 was about seven percent of the of the whole workforce so it was quite stable we'd had a lot of people with us for a long time we're now up to 17 percent to under 30 so that's improved and that's certainly we brought in quite a lot of modern apprentices about 50 over a period of years and many of them are still with us so they've become permanent members of staff. Thank you, convener. So did I understand you correctly that the the balance on the boards as such is more female than male and when it comes to asking employees about characteristics they've been reluctant to provide you with that information? I think as Janet says people have felt that when they applied to join us they provided that information as part of the application process and they haven't realised that due to data protection we don't transfer that information on to our systems so they need to re-declare so we're just pushing for people to do that and again I think you need to create a positive virtuous circle around that we need to explain to people well how are you using that information what difference is it going to make if they're providing that information what decisions are going to be made on it so that people feel it's worth providing the information because actually it informs good decisions in the organisation. But do people perhaps just feel it's private information they don't wish to share with their employer? I think potentially people absolutely do and therefore it needs to be us as a leadership community in the organisation explaining why we want to know not about individual people but at an aggregate level what percentage of people we have from different diverse backgrounds so that we can make sure that we are supporting them appropriately that they've got a voice within the organisation to raise any concerns. I want to ask about more broadly just in terms of staffing and I think over the past 10 years your permanent staff that has civil servants employed by you has decreased and I think it's dropped by something like roughly about 200 so from just under 1300 to just over 1100 is that correct and I think in the same time period if we look between the 2009-2010 figures agency staff costs were roughly if my calculations are correct about 1.4 per cent so quite a small percentage of the revenue that you bring in and 2017-2018 it's risen to 15.5 million pounds so it's it's over 21 percent of your revenue. Now that I think you've given in some sort of explanation to a certain extent about BT that you've already mentioned no longer working with you on things and doing that through agency or contractors instead and I think also the number of contractors as such has risen from well if we take the 2009-2010 figure of 31 has risen to about 161 in the 2017-2018 figure. Now I'm just wondering first of all is that an efficient use of your budget to spend so much of the revenue on contractors and agency staff at the same time as reducing your own staff and employees? It's certainly something I keep a close eye on in terms of value for money. It's partly the flexibility of where we're doing projects so for example the developments on the digital side that we've been doing where we don't see that as long term we kind of we know that to run our systems on a long term basis we'll need a certain size of digital skill in the organisation but we've been investing beyond that and so we don't want those people to be with us for the long term it is for two three years and so that's where sometimes we've been using contractors. We've also been we were expecting as our automation of services that we were talking about to actually reduce the number of people we need to be doing some of our registration activity and some of that's going a bit more slowly as we were saying as our users are not ready for going for more automated services quite as fast as we thought we would do so some of our planning on that has meant that we've taken on people on a more temporary basis on one and two year contracts where we don't see the need for them longer term. I suppose it's partly where a lot of our income is reliant on the housing market which of course runs to a cycle very conscious of our predecessors having to react in 2008 having to draw down on reserves significantly when there was a big fall in that in the amount of registrations coming into us and therefore having the flexibility at that point there was very little flexibility in the workforce and in our costs and we've brought in more flexibility since then so that we can be a bit more responsive to any potential future changes in the in the housing market. I mean I can understand that to a certain extent but it seems you know a huge percentage of the revenue if it's more than 21 percent going on agency staff costs and at the same time as the employees that you yourselves have is reducing or has reduced over the same period and going back to issues that were discussed by Angela Constance for example I mean you can know what terms and conditions your employees are employed on and take responsibility for them and how they're treated and thinking more broadly in terms of fair work for all of your employees whereas with contractors or agency staffing you don't have any say in that do you? Well we do treat our contractors as if they were permanent staff for most of our terms and conditions in not in terms of the flexi time that we offer and so on and they're looking after their own pensions and so on potentially but in terms of how they're treated on a day-to-day basis we would treat them as fairly as we possibly could we wouldn't be treating them differently there. I'm not sure I understand that because of course obviously we treat them that way when they're working but your point in having them is that you can get rid of them whenever you wish to is that not the point? We found it back to the kind of digital skills we need and the data skills we need for the future and we have found we can't we can't always recruit into our own into permanent staff so we've needed to source some of that from the market from contractors instead. But is this an efficient way to do it when such a large amount of your revenue goes on this? Well as I say we keep an eye on it we try and make it as efficient as possible and as short term as possible that we're actually using those skills for project work that has a finite end and we're also as I was mentioning earlier we're trying to use those skills as well to grow our own to avoid it being an ongoing basis so we've brought in for example some developers from CodeClan who've been able to be trained up by the more senior developers who were getting on a more contract basis and bring them in for a longer term more sustainable setup. So longer term would you expect to see the agency's staffing cost decrease as a percentage of revenues? Yes. When will that happen? Well we're we've still got significant digital work we can see for the foreseeable 18 months or so and beyond that we think we could have many of our we could probably reduce our digital needs digital skill needs significantly beyond that. I'll turn to Gordon MacDonald now. Thanks very much convener just to continue looking at the financial numbers. Over the last five financial years the organisation has made a net profit on three occasions and a net loss in two the last two years ranging from £10.9 million in 2013-14 to £15.6 million of a loss in 2017-18. What are the main factors? Given that your revenue increased by £10 million over that same period what are the main factors for this large variance? So the cost of our contractors has been a major cost over the last two years and that has been partly the the quantity of work we've been doing in that digital space so we were talking about the discharge service developing that and developing scotless and so on. We've also increased the amount we're investing in some of our resilience of our systems. We found that we weren't quite as resilient as we thought we were when there was a power outage into our Edinburgh office. We've invested in a data centre at Socton House so that we've got full fail over now between the two centres so we've invested quite a lot in that period around just making sure that the integrity of our data is absolutely the forefront. We've invested in some power support so that actually there's been four power outages in the last year that we have our customers wouldn't have even noticed that that has worked so those kinds of things have drawn down on our reserves for that. We've drawn down on our reserves similarly for that kind of refresh of our workforce. We had a voluntary exit scheme which was a large chunk of £6.1 million we spent on that in last financial year and that allowed us that bringing in some younger and some new skills and allowing some of our staff who perhaps for some people it was a big change from the 79 legislation to the 2012 legislation and changes in processes and so on so allowing some of those staff who were finding the changes more difficult some of them opted to go so we offered that voluntary exit scheme and that has helped us move on to being able to have the skills we need for the future. I mean looking at your accounts I mean it shows that staff costs including the restructuring costs of talking about increased from £50 million to £64 million and the surprising thing for me is that your voluntary exit scheme had 136 people on it and your agency staff went up to 160 increased by 160 so you know you're actually replacing the people I've left with agency staff which suggests to me that you actually needed them. We still believe that that voluntary exit scheme will pay for itself within a matter of about 18 months and what's happened is we've with some of the changes to our processes we're actually needing staff at a different grade for the processes so we've done some backfilling there's no question so in absolute numbers it hasn't fallen by 136 but we've backfilled with different skills and at different grades. In terms of the corporate plan looking forward to 2018 to 2021 the suggestion is that you will make a loss this year of £3.7 million, a profit in 1920 of £3.5 million and 2021 of £4.1 million. What are the factors that are going to change that position where you've made a you're intended to make a loss this year and you made a loss the two previous years and yet another year's time you expect that to flip over to be a profit? Partly it's around what investments we make now and for the future and we expect and what happens to our income in terms of the housing market going forward. As we're talking about the backlog of cases so some of that we do scenario planning around what if there was a significant crash in the market, how would we respond so we're ready for that and there would be a delay factor in terms of work that we have with us that we would complete but we would over a period of a few years we would expect to be thinking about actually we might have the resource to do more on the voluntary registration side and more work with our data perhaps that we wouldn't have done and so we would maybe need to be thinking about redeploying staff accordingly going forward. But you're confident you're going to hit these targets that you've set yourself? We certainly will we're revising those as we speak we're doing work around what does it look like going forward we think we'll draw down a little bit more on our reserves than we had thought we would because we haven't got quite as many of the cases out the door that we thought we would so our income will be a bit less this year than we had forecast it would be but hence we're keeping an eye on that. Looking at the reserves over the last 10 years the reserves have dropped from 122 million in 2008-09 to 71 million in the last set of accounts. What's the role of the board in establishing what the reserves policy is? We review it with the board every six months so we keep it under review and our reserves policy is a number of factors we are very conscious of keeping reserves in line for partly what happens with the market say there was a big drop in our income partly investment in land register completion and moving that accelerating that so what we do on keeper induced registration which doesn't bring a fee with it you know the balance of doing that and we also obviously offer indemnity for customers so if there's a problem that we we will follow up with our warranty so we need to keep keep reserve to cover any unforeseen amounts under that and also thinking very much about our workforce planning going forward and making sure that we've got the got the right resources there. Given that your reserves have dropped 52 million pounds in 10 years and your current reserves are at 71 million pounds what safeguards have you in place to ensure that the reserves are held that are appropriate to ensure that there's going to be a going concern going forward if you have so much fluctuation in both your income and your costs? Well through the period from 2008 to 2012 we drew down 80 million of reserves and so so there's a there's a few factors in there we we think we're compared to 2008 we've been doing a lot of investment in our in our processes and systems we've had the new legislation that allows us to work more efficiently than we than we were able to under the 79 legislation and we've we've increased the flexibility of our workforce I realise that use of contractors is is part of that but actually that allows us to be much more flexible and we've invested in our buildings are moving in Glasgow from an old building on eight floors to one building on one floor we lease a floor in which has half the space and that's saving us 400 000 a year to do that so actually we've we're doing those kinds of investments which should see us in good stead but we look at those alongside that reserves policy to just check that we are in a good place okay thanks John Mason thanks convener and just kind of following on I mean the reserves then at around 70 million are roughly the same as your revenue for that's 12 months revenue and reserve now most organisations often kind of aim for about three months and I take the point you're arguing that you're a bit more subject of volatility than other organizations so is there a policy that the norm is to have one year's revenue and reserve or six months or 18 months or have you a policy in that area we haven't phrased it in that way but it but it partly depends where we are in the in the housing cycle perhaps that we would we would want to flex it accordingly so we need a bit more flexibility at this point where the market looks as though it's slowing down a little bit and so we're looking at that it also we need to see it alongside how much work we have in that with us so the backlog of cases and is linked to how much work we have that we would still we still have to work on and so so those things in fact so we haven't got a firm policy of 12 months and but it's something we keep under review depending on the other external factors okay I mean would an alternative model just be that the Scottish Government fund you from year to year so that if you're planning over the next few years a slight profit a slight loss then either they pay you some money or you pay back to them and you wouldn't have to reserves at all is that a potential model it's a potential model our current model is and is set out in the public finance and accountability scotland 2000 act so but obviously that could be changed that was the but that's the where our current model of fees that we earn are retained for the purposes of the keeper is set out so well you're obviously going to work within the statutory framework that you have but you don't have a particular preference for what that framework should be you'll just live within whatever is there I suppose when that was presumably when that was being passed in 2000 some of the thinking was around our income being that volatility around the income that reges of scotland is perhaps a bit unusual in terms of other bodies that our income might follow a housing cycle and so an annual budgeting is more challenging and clearly it wouldn't be for us to make that decision. It strikes me it's even more challenging if you're effectively stand alone which I see you as being whereas if you were like a department of or the R department but I mean if you were if your finances were more in with the general finances there'd be a bigger pool there that could absorb the ups and the downs but I accept that's not a question for yourselves probably it's for other people. I mean again longer term just trying to tease this out a little bit more I mean I realize you're going through quite a lot of change and investment at the moment is there a kind of longer term plan that it will all settle down and or is the main factor still that because the property market is so unpredictable you're always going to have to keep sizeable reserves and have that degree of uncertainty. No I mean we are becoming much more efficient in terms of our on-going running costs and that's what some of the investment has been. I suppose there would then be choices about whether we offer additional services we've taken on additional registers over the last few years and we've we do work for revenue Scotland and so on so there would be whether as we become more efficient we take on more services or shrink the organisation would be a matter for discussion. I mean reducing your fees would be one suggestion I think Mr Whiteman was hinting at that as well. There's not a decision being made on that then? Our fees have been the same since 2011 apart from the discount for voluntary registrations and the discount for digital registrations is becoming more important in terms of how many people are gaining from that so in real terms obviously our fees have been reducing but we haven't reduced them in absolute terms. How would that work in practice if these decisions have to be made that either you do more and do more registers I mean is that just purely the Government would tell you that or would you be involved in that kind of discussion or has that discussion started or happened or anything? We'd be involved in that discussion I guess under land reform options we're in discussion around new register there. Okay thanks so much. Just to follow up on that on the staffing matter would it be possible to provide a table with the the civil servant staffing cost the overall cost for the same period the agency staff costs have been provided as a follow-up thank you. Now Andy Wightman wanted to come back and then Dean Lockhart. Thanks community there's a few other follow-up questions I want to revisit the question of accountability for the record to get this clear so prior to devolution the caper and your staff were accountable to ministers who were accountable to Parliament. Now the situation is that the keeper is accountable to Parliament for registers of Scotland operations and the Scottish ministers are accountable to Parliament for policy decisions that's your understanding is it? That's my understanding that yeah. So where does that take us in terms of the accountability for things like the failure to meet a 2019 target the failure to deliver what was promised in the scotless project who's actually accountable to that should I be asking Derek Mackay to account for that because those are solely policy decisions or is it a mixed accountability because I take it you're saying you're doing everything you can to do your bit to deliver those things and I have no reason to doubt you are so is it the Derek Mackay I should be holding accountable for those policy decisions and their wisdom or otherwise? So I think for the land register completion piece there's a variety of people who are accountable in terms of you know public bodies who are all and private organisations who need to participate in that so I think you'd need to follow up in terms of yeah how was the original target set and what were the expectations at the time about the risk I suppose with meeting that target yeah you're right we're doing everything we can to fulfil our part of the bargain I think on scotless it's a little bit different in that as Janet said an aspiration for what scotless could be was set out we were invited to deliver that system we've always wanted to be very customer led in terms of making sure that what we deliver actually evolves as customers tell us what's useful to them so I think it's we have shifted some of our priorities on scotless and I'm fully accountable for that and therefore you should be holding me to account to compare with what was asked for with what's now in place but I would stand by the view that what we've delivered so far has responded to what customers are telling us they actually want as we put something out there and ask them does this need what else would you like? Okay just moving on to three other little little questions in the forestry bill that Parliament passed last year there was a an amendment 7 in my name that came section 14 of the bill that required ministers to in such manners they considered appropriate publish information on forest holdings in Scotland including their area and proprietorship. The night before the stage 3 debate Janet Egdoll you wrote a letter to the minister that was circulated to MSPs saying that this amendment would cost £600,000 what is it's not normal to have letters circulated to MSPs from civil servants the night before a stage 3 debate can you explain the circumstances in which you were invited to provide that advice to ministers? I was having a discussion with ministers about what the cost might be around it and asked to provide that that was so that's our cost of providing that level of information on our standard costs. So do you have on the record exactly what you're asked to provide to Mr Ewing? You will have an email or a letter. It was a telephone call I think discussion we had. Could you make available to the committee whatever remit you were given because I'm just interested to know this is not clear what in response to what this letter was provided. So I think I was being asked what would be the cost if we were to provide on our standard terms that level of information and that's what I did. Thirdly we did an inquiry into Scottish economic data last year and we noted for example that the Scottish fiscal commission were paying you for data in order to come to a view on their forecasts for land and building transaction tax revenues going forward. Their job is obviously to forecast and we wondered at the time why one public body was having to pay another public body. The Government responded to our report and said that this was all being provided in accordance with information sharing agreement that the cost was quite modest in fact £23,000. That's just sort of one example and of course the cost is quite modest but do you see a case for the public sector sharing this kind of information that it requires to do its job basically at no cost? It seems ridiculous that there are transaction costs involved when one public body needs information from another one. Well I think from our point of view with our current funding arrangements it costs us money, time, staff effort to produce and provide that information. We need to operate on a basis where we recover our costs and as we don't receive money from other sources it's not viable for us to do that for free because there is a cost to us at the moment. Okay that's fair enough and just finally the Inspire directive EU directive which I think we recently considered a Brexit SI on is an EU directive to make geospatial information available. This was implemented by Register of Scotland in November 2017, I think three days after the deadline. It had been implemented by the UK land registry in 2014, three years earlier. Is there a reason why it was so delayed? That may be due to our digital systems and the investment in getting our data out. I'm not sure if I can answer for HMLR but certainly we are still reliant on a 1996 digital mapping tool that we're using and so actually it's quite a job of work for us to put that on to a better basis as part of the investment that we're doing at the moment and hence we need those digital skills to do it. So it was probably the difference between our basic systems. Just to clarify the letter to which Mr Whiteman referred about the £600,000 cost, you were asked by the minister to provide the information, you did so by letter but it wasn't you that circulated the letter. Thank you, Dean Lockhart. Follow-up question on retained profits, as I said in your financial statements. When we refer to retained profits, are we talking about an accounting entry or is this real money sitting in a bank account someplace? It's close to what's in a bank account but there are some accounting differences between what's the retained profit. How is that money invested? I noticed that interest received has fallen from around £6 million about 10 years ago to £64,000 last year, so how is that money invested? We keep some in available bank accounts through Scottish public sector banking arrangements, normal banking arrangements enough to cover our on-going costs and the longer term, any that we don't need for the shorter term, we invest in the national loan fund. And who sets the investment guidelines? Are these public sector investment guidelines you follow? Yes, we follow the Scottish public finance manual. I'm just curious. The investment or interest received last year of £64,000. If your retained profits are £70 million, that's quite a low yield you're getting on your investments. It's about 0.01 per cent. Even if it's held in a bank account, it's quite low. Is there a particular reason why the yield is so low? I think that the figure that you're picking up there is a net interest. We have a loan that was taken out on behalf of registers of Scotland at the time when the trading fund was being set up in 1996. That is that we are still paying interest on that loan. It was a 40-year loan, so there's some interest out as well as interest in. We're getting standard national loan fund rates for whatever term, two to six months, we've got amounts invested in. So that's a net number, I see. So what size is the loan that you have taken out for her? It's now £2 million. Would you be able to provide those numbers because in terms of net interest paid out and net interest coming in? If the loan is £2 million and that's offsetting interest received on £70 million, that might seem to be a bit of a mismatch there, just in terms of the yield you're getting. We've certainly looked before at whether it's value for money to pay off the loan early. It's very evenly balanced because we would pay the future interest more or less rolled up, so it would maybe cost us £3 million to pay off the £2 million early. Absolutely, it can provide you with the figures. We have looked at that and keep an eye on that as to whether that would be value for money to pay it off early. I think that concludes questions from committee members, so thank you very much for coming in. I will suspend this session and move into private meeting.