09 IMPLICATIONS AND ACTION
9.1 In this chapter we set out the implications of our proposals and our recommendations for action.
Implications for existing scrutiny
Review of roles and responsibilities
9.2 In this section we propose that the Scottish Government should carry out a programme of specific activity to assess existing scrutiny activity against the recommendations in this report. This work should be coordinated at Cabinet level to ensure a consistent approach. All reviews of specific inspection and regulatory functions should also assess the scope for amalgamating bodies with common interests, or reallocating responsibilities to one organisation where there are unnecessary direct overlaps. They should also identify opportunities to share resources (including staff) to deal with overlaps.
9.3 External financial audit is currently the preserve of the Auditor General and the Accounts Commission. These financial audits are delivered on their behalf by Audit Scotland and by a number of contracted private sector providers. We propose no changes to this function - we believe financial probity is critical and requires ongoing, independent checks.
9.4 Performance audit currently accounts for a significant proportion of Audit Scotland's activity (as directed by the Auditor General and the Accounts Commission). In the future system for external scrutiny, we envisage this type of function will still be required. However, we propose that these audits would fit directly within the system described above i.e. the Auditor General and the Accounts Commission would ensure the audits were aligned with the overarching strategic priorities for external scrutiny; and directed as required, after the advice of experts had been sought. We describe later how this advice might be secured.
9.5 The Best Value audits of local authorities are also a form of performance audit, but are performed on a cyclical basis. We agree with the improvements to the audit process identified in the recent review of Best Value commissioned by the Accounts Commission. We;believe that the Best Value audit process in the local government sector should provide the basis for a single corporate assessment and should absorb other corporate level inspections, such as INEA education inspections. The Accounts Commission should work with other external scrutiny organisations to take this forward.
9.6 We are recommending that existing inspection programmes be reviewed immediately by Ministers. The implication of our recommendations is a reduction in cyclical inspection programmes, with a corresponding increase in emphasis on self-assessment and performance reporting by providers. In future new inspection would only be introduced after assessment by a panel, and in line with criteria outlined in chapter 8. We describe below some examples of where we think there should be significant change:
(a) HMIE's INEA inspections - these would be stopped once the current round of inspections is complete. Key issues identified as part of the current round should inform, or be subsumed, into Best Value audits and into the self-assessment process for the future;
(b) SWIA's social work services inspections - as described above for HMIE's INEA inspections;
(c) HMIE joint inspections and SWIA's integrated inspections - these should be reviewed/evaluated immediately, to assess whether they are delivering the intended benefits;
(d) Any proposed new integrated or joint inspections should not be started unless evaluated by the criteria proposed in chapter 8. For any future integrated inspections a lead organisation would be identified and appropriately resourced (from existing organisations, either external scrutiny organisations or service providers) and given sole responsibility for delivering the inspection - other external scrutiny organisations would be given a duty to collaborate;
(e) Service-based inspections ( e.g. schools, prisons etc) - should be subject to immediate review, with a clear evaluation of benefits delivered. Immediate consideration should be given to reducing the frequency of service-based inspections;
(f) Thematic inspections, like performance audits, should be aligned with strategic priorities and undertaken only after the advice of experts has been sought.
9.7 There will always be the need to enshrine certain elements of service provision within statutory regulations, usually to provide basic safeguards that service providers are fulfilling minimum criteria, and there is a corresponding need to monitor on-going compliance. Regulation often secures entry into the sector, and potential service providers have to demonstrate how they will comply with the regulations as a condition of entry. Compliance monitoring has traditionally been achieved through the creation of a dedicated regulatory body to register, monitor and report on compliance with regulatory requirements and to deal with non-compliance through the use of sanctions. The process of monitoring is usually achieved through cyclical inspection programmes by the dedicated regulatory body.
9.8 We are proposing that in future, if regulation is found to be a necessary response to a given issue, there should not be the corresponding creation of a dedicated regulatory body to monitor and ensure compliance. The monitoring of on-going compliance should be achieved primarily through self-assessment and performance reports by providers, supplemented by external scrutiny as necessary through an existing organisation. It will still be necessary to provide external scrutiny with appropriate powers of intervention, for example, where clients are vulnerable and the risk of service failure requires immediate intervention without referral to Ministers or the Parliament.
9.9 The implications for the two main public services regulators, Communities Scotland and the Care Commission, would be that their registration functions would continue but there would be a more proportionate approach to checking ongoing compliance and a relaxation of the frequency of inspections There would also be a review of the 'triggers' that would identify when an inspection might be required. In the case of the Care Commission there should also be a more efficient registration process to avoid the duplication created by individual organisations having to register every service they provide separately.
9.10 For other regulators such as Office of the Scottish Charities Regulator ( OSCR), we recommend an immediate review of the need for existing functions in line with the criteria we are proposing. It is questionable whether organisations such as OSCR would have been established if the criteria in our proposed new system had been in place.
Review of information requirements
9.11 Existing external scrutiny organisations should review the data they gather, with a view to reducing overall requests, eliminating duplicate requests and sharing and 'passporting' information where possible. We recognise that the Knowledge Management Group, chaired by the Care Commission, is already undertaking work in this area which can be developed. The Scottish Government should place a high priority on this issue and ensure that priorities and leadership are assigned to taking such work forward. The Scottish Government should also ensure that parallel work to improve data gathering across public services more generally links with work in the scrutiny sector. In all cases, the focus would be on minimising the workload for service providers and we anticipate this would mean a significant reduction in the current workload.
Improving accessibility of reports
9.12 We highlighted earlier that scrutiny reports are often difficult for the public to access and understand. We believe there is considerable scope for scrutiny bodies to collectively and individually consider how information can be made more accessible and transparent for a public audience. We recommend that scrutiny bodies should aim to develop common reporting language to communicate the complexity of what they have found as straightforwardly as possible. Scrutiny bodies should also demonstrate in their reports how their work focuses on the experience and outcomes for the public and for service users.
External scrutiny website
9.13 An external scrutiny website, or portal, should be developed, under the direction of the Scottish Government, where all organisations that currently undertake external scrutiny should log all planned activity. The portal should allow anyone ( i.e. other external scrutiny organisations, service providers, the public) to see what activity is planned for any service, organisation or sector; or by any external scrutiny organisation. Unannounced inspections will also be logged but only other external scrutiny organisations will be able to see these. External scrutiny organisations would be responsible for developing the portal.
9.14 The purpose of the portal would be to facilitate easier information sharing about planned activity, primarily between external scrutiny organisations. However, the portal may deliver some other benefits if used effectively by external scrutiny organisations. For example, it might be that they could undertake more work and information-gathering on behalf of each other. It would also allow all stakeholders to examine the overall volume of external scrutiny activity and to identify what specific areas were being targeted.
Implications for key sectors
9.15 Local government has experienced significant developments in external scrutiny in recent years. It has been the first sector to be required by legislation to comply with the principles of Best Value. Performance indicators and outcome measures for local government are also being developed by the Scottish Government and other stakeholders. We believe that this focus should continue, with a view to local government being the first sector in which self-assessment will become the core tool of accountability, with less reliance on external scrutiny required. Our recommendation for reviewing all cyclical inspection; and merging corporate assessment processes into the Best Value audit process will also have a significant impact on the local government sector.
9.16 However, until these longer term changes are implemented fully, existing scrutiny activity should be coordinated more effectively. We propose that Ministers should identify and appoint an appropriate scrutiny body to oversee the delivery of scrutiny programmes in local government, aiming to minimise compliance burdens. This body would oversee the implementation of the practical arrangements that we outlined in the previous section for local government. A natural candidate would be the Accounts Commission.
9.17 Much of the existing scrutiny of the health sector is not external and independent. We recognise that health boards will view the activities of NHSQIS and the Scottish Government's health directorates as external to them but it is internal to the health service. We therefore recommend that functions and resources from within NHSQIS and the Scottish Government's health directorates, as well as resources controlled by the Care Commission in relation to private hospitals and related treatment be redistributed to an external scrutiny organisation. However, this redistribution should take place only once the external scrutiny priorities for health have been identified. External scrutiny in health must balance the scrutiny of management processes and performance (aligned to the single corporate assessment) with the scrutiny of compliance with safety requirements and protective regulations.
9.18 Most of our recommendations can be achieved without legislative change, but some will require change. This is particularly likely where the recommendations include a review of existing governance arrangements or existing external scrutiny programmes. This will become clearer once the recommended reviews of individual scrutiny regimes have been carried out.
Long term implications for scrutiny arrangements
9.19 In the longer term we believe there is scope for a significant reduction in the number of bodies. To be credible and to provide assurance, external scrutiny must include the perspective of relevant experts or professionals. At present this expertise is housed within the various individual inspectorates and regulatory bodies, with each carrying out their individual inspection and audit programmes and each using different methodologies. Departures from this norm have occurred over recent years with the introduction of multi-agency or joint inspections whereby programmes of inspection are carried out using teams made up of representatives from each of the relevant inspectorates.
9.20 In the medium term we are proposing better leadership and control, with existing external scrutiny resources being directed in a more coordinated way. However, in the longer term, we believe that our proposals if followed should lead to the creation of a single national scrutiny body with a core staff, expert in the business of external scrutiny, with access to a range of professionals with knowledge relevant to the area under scrutiny, enabled through flexible employment practices. The graduation of all scrutiny bodies to a single national scrutiny body may seem ambitious and difficult to achieve. We strongly believe that for a nation the size of Scotland such an ambition is both achievable and appropriate. The benefits of synergy in resources, skills and purpose far outweigh the disruption to the scrutiny sector and service providers, and we believe if all embrace this ambition, it is achievable in the long term.
Chapter summary and recommendations
Review of roles and responsibilities
- Ministers should carry out a programme of specific activity to assess existing scrutiny activity against the recommendations in this report, coordinated at Cabinet level. The main focus will be on inspection and regulation activity. All reviews of specific inspection and regulatory functions should also assess the scope for amalgamating bodies with common interests, or re-allocating responsibilities to one organisation where there are unnecessary direct overlaps. They should also identify opportunities to share resources (including staff) to deal with overlaps.
- The Accounts Commission should work with other scrutiny organisations to develop a single corporate assessment which absorbs other corporate level inspections in local government.
- New inspection must only be introduced after assessment by a panel.
- No new regulators should be set up to monitor compliance. Where this function is thought necessary, it should be given to an existing scrutiny organisation.
- Existing external scrutiny organisations should review the data they gather, with a view to reducing overall requests and to eliminate any duplicate requests. The Scottish Government should place a high priority on this matter and ensure that priorities and leadership are assigned to taking such work forward.
- The Scottish Government should also ensure that parallel work to improve data gathering across public services more generally links with work in the scrutiny sector.
- The Scottish Government and scrutiny organisations should develop an external scrutiny website, or portal where all planned scrutiny activity will be logged.
- Scrutiny bodies must make information more accessible, develop common performance reporting language and explore ways of explaining the complexity of what they have found as straightforwardly as possible.
- The local government sector should be the first sector in which self-assessment will become the core tool of accountability, with less reliance on external scrutiny required.
- Ministers should immediately identify and appoint an appropriate scrutiny body to co-ordinate scrutiny of the local government until the longer term changes are implemented fully.
- Ministers should redistribute resources and functions from within NHSQIS, the Scottish Government's health directorates, and the Care Commission (in relation to private hospitals and related treatment) to an independent external scrutiny organisation.
Single national scrutiny body
- Our proposals if followed should enable the creation of a single national scrutiny body in the longer term. Ministers and the Parliament should use reductions in the volume of external scrutiny to reallocate responsibilities to a single body.