Information

Corporate Board minutes: December 2021

Minutes from the meeting of the Corporate Board on 7 December 2021.

This document is part of a collection


Attendees and apologies

Present:

  • Leslie Evans (Chair), Permanent Secretary

  • Roy Brannen, Interim DG Net Zero

  • Andy Bruce Director, Communications and Ministerial Support

  • Michael Chalmers, Director for Children and Families (substitute for Joe Griffin)

  • Colin Cook, Director for Economic Development (substitute for Elinor Mitchell)

  • Lesley Fraser, DG Corporate

  • Annie Gunner Logan, Non-Executive Director

  • Ronnie Hinds, Non-Executive Director

  • Paul Johnston, DG Communities

  • Caroline Lamb, DG Health and Social Care

  • Ruaraidh Macniven, Solicitor to Scottish Government

  • Jackie McAllister, Chief Financial Officer

  • Hugh McKay, Non-Executive Director

  • Nicola Richards, Director for People

  • Alyson Stafford, DG Scottish Exchequer

  • Ken Thomson, DG Constitution and External Affairs (until 14.30)

  • David Rogers, Director, Constitution and Cabinet (substitute for Ken Thomson from 14.30)

In attendance:

  • Jennie Barugh, Director, Performance and Strategic Outcomes

  • Luke Cavanagh, Unit Head, Corporate Analytical Services

  • Angela Flynn, Head of Financial Management and Reporting

  • Andrew Watson, Director, Budget and Public Spending

  • Robyn Whitelaw Grant, Head of Governance and Risk Team

Secretariat:

  • Claire Tynte-Irvine, Board Secretary

  • Jo Ward, ET Secretariat

  • Pamela Wilkinson, ET Secretariat

Apologies:

  • Joe Griffin, DG Education and Justice

  • Madhu Malhotra, Director for Equality, Inclusion and Human Rights

  • Linda McKay, Non-Executive Director

  • Elinor Mitchell, Interim DG Economy

  • Ken Thomson, DG Constitution and External Affairs (from 14.30)

Items and actions

Welcome, introductions, apologies, declarations of interest, minutes

The Chair welcomed everyone to the fourth Corporate Board (‘the Board’) meeting of 2021. There were no declarations of interests noted.

The Board agreed the minutes of the meeting on 7 September 2021 and the updates to the action tracker.

Permanent Secretary overview

The Chair provided an overview of events since the last Board meeting in September 2021, including how the organisation has continued to move into the next phase of the Covid-19 pandemic whilst hosting COP26, setting out the Covid Recovery Strategy, preparing for the Scottish Budget and taking forward Programme for Government commitments.

The Board noted:

  • the continued use of the Four Harms approach to effectively support the country through this stage of the Covid-19 pandemic

  • reflections on the experience of supporting COP26 in this context, as a critical meeting of the global community in efforts to tackle the Climate Emergency

  • the improvements to the management of performance and delivery against the important and stretching targets Ministers have set

  • the Scottish Budget, due to be published on Thursday 9 December, has been developed in a commendably collaborative and transparent process. The next step being to embed this outcome into business plans and objectives across the organisation

  • the In the Service of Scotland Festival, which had a high level of engagement and provided a variety of innovative events online, including with Ministers

  • the guidance on working from home arrangements is being continuously observed, with a view to strengthening communications on expectations in response to the impact of the new Covid variant

  • the impact that prolonged working from home arrangements and the ongoing pandemic may be having on mental health, resilience, creativity and innovation within teams, noting the forthcoming results from the People Survey

Financial stewardship

The Chief Financial Officer and Director for Budget and Public Spending gave an overview of the financial position and an update on the 2022–23 Scottish Budget and Resource Spending Review, noting:

  • the 2022-23 Budget is due to be introduced to Parliament on Thursday 9 December, and will focus on the delivery of the Programme for Government, Bute House Agreement and Manifesto and centre around three key themes: tackling child poverty, transitioning to net zero and supporting a just, green economic recovery

  • the Scottish Government’s resource position for 2021-22 remains challenging, however there has been a reduction to full year forecasts as areas continue to progress towards meeting their spend reduction targets

  • the 2021-22 budget flight path requires a balanced budget to be achieved by the end of February. The organisation is on track to meet the December milestone, on the basis that Health consequentials are utilised to manage the total remaining pressure

  • there are continued risks, such as the potential for lower consequentials than anticipated. Without a Barnett Guarantee in place, there is a risk of negative consequentials being applied at the Supplementary Estimate in early 2022

  • for the 2022-23 budget, Covid-19 funding has been removed from the funding envelope, therefore the net position is a reduction in the available resource budget

  • Cabinet Secretary for Finance and the Economy will advise Cabinet on the importance and impact of addressing existing pressures before funding new programmes

  • the new Covid-19 omicron variant could result in short term implications across the Health and Social Care sector which may have financial consequences

In discussion the Board noted and agreed:

  • that Accountable Officers continue work on ensuring spend reduction targets are met in full so that the organisation can remain within the 2021-22 budget

  • the influence of Accountable Officers and Finance colleagues on the budget allocation decisions being made at Ministerial level, demonstrates a shift in the way in which decisions are being made, thanks to the use of consistent language around the challenges of affordability and alignment to the three priorities

  • that further development is required to embed this thinking into business planning and personal objectives throughout the organisation, including the skills, data and analysis to underpin value for money

  • that there is a considerable opportunity cost from the effort required from finance professionals and Accountable Officers to reduce over commitment in the current budgets and an analysis of this activity would be instructive

  • the consultation for the multi-year Resource Spending Review (RSR) will be a key input to the overall process, alongside ongoing internal work to review the effectiveness and efficiency of spend and develop options to support the delivery of outcomes and fiscal sustainability, with the Covid Recovery Strategy representing a key delivery vehicle over the next year

Organisational health

DG Corporate highlighted the management information showing continued growth in staffing and an improving picture across annual leave, flexi and overtime balances. Nonetheless, capacity and capability concerns persisted, including in relation to the impacts in some areas of ongoing home working.  A workforce strategy and its underpinning components – including talent, recruitment, capability, systems and planning - was being scoped and the Board would be kept informed about its development over the course of 2022.

In discussion the Board noted:

  • the value of the data presented to steer attention in the process of workforce planning, and that this would be underpinned by ongoing systems transformation

  • that an effective workforce strategy would need flow from a clear business strategy, including local business planning

  • the extraordinary circumstances of the pandemic, which would have implications across the life of such a strategy, including the need to manage resilience and systematise the approach to managing demand across the organisation

Director, Performance and Strategic Outcomes outlined the continuing collaboration to develop a performance framework across the whole of government, noting the recent feedback from the Deputy First Minister on the need to track delivery of key priorities.  Work was ongoing, in partnership with policy leads, to integrate these approaches and would be reported to the Board in March 2022.

In discussion the Board noted:

  • the significant complexity in developing an overall framework and the encouraging progress being made in identifying and addressing the underlying issues

  • the importance of consistency in the use of terminology and concepts to drive this process and support connections to workforce planning, financial management and the resource spending review

  • the need to secure improvement through the development of internal and external feedback loops with a system that was shared and recognisable to partners

  • the balance and interplay between delivery assurance and benefit realisation, supported by evidence

  • a welcome for the focus on Child Poverty as a test of concept, but the need for the whole organisation to lean in to this process, including through the discipline of business planning

The Board considered the latest analysis of the Corporate Risk Register, welcoming the increased capacity in the Governance and Risk Branch and noting encouraging evidence of increasing use of the Register to manage risks more effectively across the organisation.

Annual accounts and Governance Statement

The Chief Financial Officer provided an overview of the Scottish Government Draft Annual Accounts for 2020-21 and the companion Draft Governance Statement, both of which were due to be considered by the Scottish Government Audit and Assurance Committee (SGAAC) on 13 December 2021 ahead of being laid in the Scottish Parliament no later than the 23 December 2021.

The Board considered the draft Governance Statement which had been developed from the DG Certificates of Assurance and reflected developments since the end of the reporting period. The Board noted that the Statement would be updated ahead of being presented to SGAAC to include further information on Covid-19 Business Support Grant Expenditure. The Board noted that no further additional amendments were required but the Board invited the Chief Financial Officer and Permanent Secretary to consider whether risks associated with fiscal sustainability already articulated in the statement should have greater prominence, it was highlighted that criteria did not allow for this to be included in the significant issues section but further text was agreed to be added to the Covid-19 response section of the Governance Statement on actions taken to further address the Fiscal Sustainability risk.

The Board noted and agreed that it was content, in principle and subject to the resolution of the audit matters still being discussed and updates to the Governance Statement, in particular in relation to Covid-19 Business Support Grant expenditure, for the Accounts and Governance Statement to go forward to SGAAC.

AOB

The Chair thanked Hugh McKay, Non-Executive Director for his input on the Board and in a number of other Sub-Boards and Programme Boards since joining the Scottish Government as a Non-Executive Director in 2014, on this, his last meeting as member of the Board.

DG Corporate thanked the Permanent Secretary for her contribution as Chair of Corporate Board on her last meeting of the Board. 

Contact

Email: ceu@gov.scot

Phone: 0300 244 4000

Post:
The Scottish Government
St Andrew's House
Regent Road
Edinburgh
EH1 3DG

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