Energy Efficient Scotland programme: analysis of delivery mechanism

• Development of a specialist Steering Group formed of representatives from within relevant directorates of the Scottish Government. In isolation, the group would be responsible for managing all potential roles of the new EES architecture, such as monitoring progress and providing advice and assistance to those organisations currently involved in deliver EES initiatives, i.e. Local Authorities. The group would have a formal enduring remit of ensuring the successful delivery of EES and would be staffed by civil servants and representatives of relevant groups.

• Development of a specialist Steering Group formed of representatives from within relevant directorates of the Scottish Government, as above. This is in addition to large scale resourcing and investment in additional functions within the Scottish Government Directorates and Local Authorities to enable delivery.
• This would include, delivery of the required functions outlined in the strategic case such as enforcement, engagement, funding, monitoring etc. However, here the delivery function of the Steering Group would be limited, as actual role delivery would be carried out by staff within the relevant directorates. The Steering Group would likely function as an overarching co-ordination body.

• A Strategic Board made up of Ministers and local government leaders, which provides and adapts the strategic direction to the Programme, as needed. This board would oversee an EES Delivery Board which would bring a range of stakeholders together (Inc. senior SG and local government officials). This body would look to provide direction and resourcing to; workstreams (or similar) involved in policy and/or on-the-ground delivery of the Programme, co-led by SG, COSLA, local authority and/or other officials, as needed. The EES Delivery Board could be rebranded to be the single-point-of-access.

• Development of a specialist Steering Group formed of representatives from within relevant directorates of the Scottish Government, alongside the creation of a bespoke new directorate tasked with the delivery of EES. The entire new directorate would be accountable for the delivery of the required functions to deliver EES, working with other directorates where appropriate. Both Steering Group and Directorate would be staffed by civil servants. This new body could be created by either lateral transfers of existing Civil Service staff, new hires or a mixture of the two.

• Allocation of one or more of the expected functions of the new EES programme to either an individual or multiple bodies currently in control of the Scottish Government. With additional funding, and with one of these organisations acting as a focal point, delivery of the overarching programme could be done through these existing organisations with sole accountability for individual workstreams place within either the same, or multiple existing bodies. Funding would likely have to come directly from the Scottish Government.

• Allocation of one or more of the expected functions of EES to either individual or multiple bodies currently not in control of the Scottish Government, but with a remit and working to deliver relatable policy in Scotland. Additional funding would be required directly from government. One of these organisations would act as the focal point for the programme, or alternatively a central area (Steering Group) could be tasked to deliver this role within the Scottish Government. Delivery of the overarching EES agenda (this individual roles) could be done through these either one or multiple of these existing organisations.

• A newly developed independent body separated from any government department. This body would be responsible for all delivery aspects of EES, and would work with other government directorates and bodies where appropriate. This body would not necessarily be mandated to itself deliver EES functions, but would at a minimum manage their delivery with the possibility of outsourcing work to other organisations.
• This body would be staffed by civil servants including the Chief Executive, who would be directly accountable to Ministers of the Scottish Government (likely Housing or Energy). The agency would not be a statutory body but would operate in accordance with a Framework Document which is approved by Ministers.

• Would function in a similar manner as an Executive Agency as an agent to ensure delivery of all aspects of EES, with the potential for outsourcing of individual projects where appropriate. However an NMO would be a statutory body headed by a board or statutory officeholders appointed by Ministers. An NMO would not be part of the Scottish Government but part of the Scottish Administration in their own right.
• Funded by Parliament and required to publish their own annual report and accounts in the same way as the Scottish Government is required to do. Directly accountable to the Scottish Parliament for the discharge of their statutory functions, but may carry out statutory duties for Ministers.

9

Executive NDPB

• An Executive NDPB set up to provide both independent advice, but to also function in a delivery role. The body would manage the overall delivery of all aspects of EES (with potential for outsourcing), and function as an arm’s length department. As an example, this could involve the body either directly taking on, or managing the delivery of enforcement, educational or data infrastructure driven roles within EES, as well as other roles.
• The body would be accountable to the Scottish Government through their key performance measures and established in statue. The body would be set up through legislation, employ its own staff and prepare their own accounts for presentation to Parliament. The body could also potentially raise revenue independently of government where commercial activities fit within the remit of delivery of EES.

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Public Corporation

• Creation of a Public Corporation, this model functions as above, as the overall delivery agent responsible for the delivery of all aspects of EES. A Public Corporation is a commercial enterprise under Government control, employing its own staff, who are not civil servants, managing their own budgets and reporting to a Board whose members are appointed by Ministers.
• This could be established either as a statutory body E.G. Scottish Water, or as a company regulated by company law. As a commercial organisation this body would need a revenue generating role outside of simply government funding (at least 50% of revenues), these could potentially be based on areas such as consultancy services, energy efficiency installations, accreditation provision, licencing or potentially the role of a Public Energy Supplier (a POEC).

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Trading Fund

• A trading fund focussed on delivery of EES. This body would handle all delivery aspects of EES, while also handling its own revenues and expenses separately from overall government finances. A Trading Fund would function more like a business, as opposed to having to obtain funding from the government's legislature and feeding income back into its treasury.
• As a trading fund model, a significant proportion of operational funding would be required to fund from commercial sources. Similar to a Public Corporation, this body would need a revenue generating role outside of simply government funding. It is noted that there has been a tendency to not set up new trading funds by the Scottish Government, and that this body is primarily suited towards operations which are all commercially orientated.

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Charitable Trust

• A charitable trust established for charitable purposes while also working as a delivery agent for EES. This body would enjoy a varying degree of tax benefits, however due to government charity law would be severely restricted on the potential roles it could fulfil.

• Broadly, the Steering Group option, in isolation, lacks the required resource available for the delivery of a number of key roles, and would only be able to provide a limited overview role.

No

This option is unlikely to sufficiently resource delivery.

• Supplementing a Steering Group with additional delivery support from a number of different Scottish Government Directorates does allow a significant increase in the breadth of delivery roles available.
• However, this option would face difficulties as functioning as a central point of reference, and still faces restrictions on delivery as placed within central government.
• For instance, central government has limited experience in delivering enforcement activities.

Yes

This option is taken forward as the “do minimum” counterfactual.

• A delivery mechanism which involved the creation of a new Scottish Directorate is able to improve on the performance of the counterfactual.
• This body, similarly to the counterfactual, would be able to draw on the machinery of government to support delivery, while also acting as a single point of reference.
• However it would still face constraints on the delivery of certain roles not suited to government.

Yes

• A delivery mechanism which involved the creation of a new development group with a local level delivery is able to improve on the performance of the counterfactual.
• This model would benefit from being closer to the on the ground work being delivered, such as supporting the supply chain and local enforcement.
• However developing and managing an effective Collaborative Structure could be novel and challenging across a large number of Local Authorities, potentially with differing levels of resource and expertise to contribute.

Yes

• Broadly speaking, there is little scope for the 10 roles and 5 key roles to be delivered solely by existing bodies.
• Despite some relevant expertise across the required roles, such as providing technical advice and support, without the significant amendment to the powers and potentially resourcing of these bodies, they would lack the authority, breadth of capability or capacity, including to act as a central point of reference, due size constraints.

No

Unlikely to deliver at scale due to capability and size constraints.

• Bodies outside of Scottish Government control are unlikely to have resources or scale to support delivery, for the majority of the required roles.

No

Unlikely to deliver at scale due to capability and size constraints.

• An Executive Agency has the ability to establish a clear central brand and focal point, while also potentially allowing for development of scale and expertise required across the different roles.
• This model performs well compared to the counterfactual, it has greater coherence and with suitable resource allocated, greater scope to develop the delivery capacity to fulfil the majority of the required roles.
• However, regulatory, enforcement and quality assurance activities might not sit well with a body while under direct Ministerial control.

Yes

• Similarly to any arm’s length body, NMOs have the capacity and autonomy to enable and deliver the majority of the required roles.
• Potentially greater scope for regulatory, enforcement and quality assurance roles given the high degree of separation from direct Ministerial and government control.

Yes

• The Executive NDPB is the highest performing model regarding role delivery. This model is able to utilise all of the above benefits of being an arm’s length, central delivery agency.
• This model is also potentially better able to develop, acquire and retain varies specialist technical resource given its greater freedoms regarding employment terms.

Yes

• Public Corporations are also able to leverage many of the prospective benefits above, and could in principle perform well across all roles.
• However, a Public corporation is required to generate at least 50 percent of its revenue from commercial sources and the commercial models that would support this are not yet developed.
• A commercial vehicle could also be seen to have a potential conflict of interest between such commercial activities and any regulatory, enforcement or quality assurance role.

Yes