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Energy Efficient Scotland programme: analysis of delivery mechanism

Report exploring how best to oversee the delivery of our programme to improve energy efficiency and promote low carbon heating in Scotland's homes and buildings.


12 Outline management case

12.1 Key points

This chapter provides an initial outline of the management case for the shortlisted options. It focuses on the deliverability of the options, and key aspects of how the delivery body will be managed going forward, in particular the degree of freedom the body will have to deliver the aims of the EES programme.

  • With delivery models that are further from Scottish Government, it will be important that they are set up in such a way that Scottish Government retains the required degree of control over strategic direction.
  • In terms of deliverability, more arm’s length models will take longer to implement due to the need for legislation. However, given the length of the EES programme this does not preclude any options.
  • The best performers are NDPB, Public Corporation and the new directorate. NDPB and Public Corporation score strongly across all areas of the commercial case. The new Directorate and Executive Agency also perform well, although these may be constrained in its ability to offer long term commitments, due to its dependence on the political cycle. Steering group models perform less strongly, due to a lack of a defined framework to allocate management responsibilities.

12.2 Management structure

The shortlisted options present several variations of management structure. These are summarised in the chart below:

The shortlisted options present several variations of management structure

The shortlisted options present several variations of management structure

In order to provide effective management of the EES programme, these structures must provide:

  • Accountability on the roles and functions which have to be delivered;
  • Effective interface with the supply chain and property owners and occupiers; and
  • Adequate governmental or parliamentary oversight, and the ability to intervene and change priorities.

None of the models above prevent the conditions being fulfilled. However, for some models where the delivery is close to Scottish Government (Steering Group models) arrangements will be more informal, with the involvement of multiple directorates and delivery partners, which creates scope for a less clear governance model.

For arm’s length models, it will be important to ensure that the Scottish Government retains the control it needs to make changes to programme delivery (while recognising the benefits of giving the management of the body the freedom to deliver EES as they see fit).

Relevant staff should attend the Scottish Government’s internal joint network group which covers all bodies being established, as this a good forum for information gathering on previous learnings.

12.3 Project deliverability

Models that are closer to Scottish Government (Steering Groups, creation of a new directorate) will be easier to set up than more arm’s length bodies. However, care would still need to be taken to create a model that allocated responsibilities between the various stakeholders (different directorates and partners such as Local Authorities).

If a decision was taken to create a new public body, Scottish Government guidelines recommend that it should have at least 3 operational years. Given that the EES programme will run until 2040, a new delivery body would meet this condition.

For options that involve the creation of a new public body through legislation e.g. Public Corporation, Executive NDPB, there is likely to be a significant time lag (of up to 3 years) before the new body is fully operational. Given that:

  • Clarity around many of the roles a new delivery body would provide are subject to further policy decisions; and
  • Transitional governance arrangements could be put in place while the administrative/legislative process for setting up a new body was followed.[54]

12.4 Areas for further consideration

Given that the management case is currently at an early stage, more work will be required to develop it more fully in future iterations of the business case, in particular:

  • Identification of clear delivery dates and milestones for the creation of the delivery body, including legislative timetable;
  • Proposed programme management approach for creation of delivery body;
  • Plans for post implementation evaluation arrangements; and
  • Contingency planning, and approach to management.

Table 18: A summary of management case assessment

No

Option name

Degree of government control

Ability to build and preserve organisational knowledge

Ability establish enduring commitments, independent of political cycle

Responsiveness to changing circumstances

Delegated management freedom in delivering purpose

Ease of transition to new model

Clarity of governance model

1

Steering Group & Scottish Government delivery

Higher

  • Staffed by Civil Servants.
  • Delivery resources directly under control of SG directorates.

Lower

  • Frequent rotation of staff.
  • Risk of expertise diluted within individual directorates.
  • Potentially reduced ability to identify and access relevant experience
  • Reliant on underlying directorates to maintain knowledge.

Lower

  • Lack of formal entity to act as counterparty.

Higher

  • Lack of formal framework potentially enables agile response.

Lower

  • Steering Group model lacks direct leverage over delivery.
  • Dependent on individual directorates.

Higher

  • Requires no new formal organisational framework, but does require cross directorate collaboration.
  • Absence of new formal structures should facilitate a rapid transition.

Lower

  • Informal arrangement.
  • Direct involvement of multiple directorates.
  • Lack of formal powers.

2

Scottish Government Local Collaborative Structure

Medium

  • Staffed by Civil Servants.
  • Delivery resources directly under control of SG directorates.
  • However number of parties involved further away from government control.

Lower

  • Frequent rotation of staff.
  • Risk of expertise diluted within individual directorates.
  • Potentially reduced ability to identify and access relevant experience.
  • Reliant on underlying directorates to maintain knowledge.

Lower

  • Lack of formal entity to act as counterparty.

Higher

  • Lack of formal framework potentially enables agile response.
  • Agile due to number of smaller organisations working on the ground.

Lower

  • Non centralised model lacks direct leverage over delivery.
  • Dependent on individual directorates.

Medium

  • Requires no new formal organisational framework, but does require cross directorate collaboration.
  • Absence of new formal structures should facilitate a rapid transition.
  • However does require clear framework to transition significant number of new parties into governing role.

Lower

  • Informal arrangement.
  • Direct involvement of multiple directorates and Local Authorities and other bodies.
  • Lack of formal powers.

3

Creation of EES Directorate

Higher

  • Staffed by Civil Servants.
  • Delivery resources directly under control of SG directorates.

Medium

  • Frequent rotation of staff, as these remain civil servants.
  • Single organisation has its own records management system and library of expertise.

Lower

  • Lack of legally separate entity to act as counterparty.
  • Ministerial direction can amend focus at short notice.

Higher

  • Framework document may be amended by Ministers at any time.

Medium

  • Directly answerable to Ministers.

Higher

  • Fairly simple to create new directorate by reorganisation, however existing functions have to be able to continue.
  • However need to ensure there are clear distinctions between roles and responsibilities between multiple directorates.

Higher

  • Clear definition of roles, responsibilities and accountability.

4

Executive Agency

Higher


  • Staffed by Civil Servants
  • Clearly designated units of a central government department, administratively distinct, but remaining legally part of it.

Medium

  • Frequent rotation of staff, as these remain civil servants
  • Single organisation has its own records management system and library of expertise.

Lower

  • Lack of legally separate entity to act as counterparty
  • Ministerial direction can amend focus at short notice.

Higher


  • Framework document may be amended by Ministers at any time.

Medium

  • Directly answerable to Ministers
  • Framework may be amended at short notice.

Medium

  • Does not require statute for set up, but does require agreement between directorates regarding allocation of staff and resources, and creation of structure.

Higher

  • Clear definition of roles, responsibilities and accountability.

5

Non-Ministerial Office

Medium

  • Staffed by Civil Servants.
  • Headed by office holder in Scottish Administration.
  • Not part of Scottish Government but accountable to parliament likely through Minister for Energy or Housing.
  • Funded through Scottish Consolidated Fund rather than through Ministerial portfolios.
  • Managed by statutory Board.

Medium

  • Ability to maintain expertise may be better as staff not linked to particular directorates.
  • Single organisation has its own records management system and library of expertise.

Medium

  • Accountable to Parliament rather than individual Minister.
  • Powers and duties set out in statute, but boards appointed by Ministers.

Lower

  • NMOs are accountable to and funded by Parliament, and therefore requires parliamentary approval for amendments to purpose.
  • Not subject to direction of Ministers in execution of statutory functions.

Medium

  • Primary accountability to Parliament rather than Ministers.
  • However, significant scrutiny remains through e.g. ministerial approval of plans and budgets.

Lower

  • Likely to be time-consuming and complex to create because of need for parliamentary approval.

Higher

  • Clear definition of roles, responsibilities and accountability.

6

Executive NDPB

Medium

  • Not civil servants.
  • Not part of Scottish Government but accountable through KPIs.
  • Separate legal identity (statute or company limited by guarantee).
  • Operate under strategic framework set by Minister, who oversee corporate and business plans and set direction of travel.

Higher

  • As the employer of its staff who are not civil servants, the NDPB has greater scope to create, sustain and develop expertise.

Medium

  • Powers and duties set out in statute, but boards appointed by Ministers.
  • Ministers set the strategic framework for the body.

Medium

  • Functions are generally set out in statute rather than a framework document, and as such may be more difficult to vary significantly at short notice.
  • If set up as corporate entity, Directors have duty of care to corporate entity. This may make it harder to reach agreement on changing role.

Medium

  • Delegated responsibility for day to day operations subject to Ministers' strategic oversight.
  • Ministers agree corporate at business plans.

Lower

  • Likely to require powers under statute to be agreed.
  • Separate legal entity needs to be created.
  • Ministers may be able to sponsor without wider parliamentary approval.

Higher

  • Clear definition of roles, responsibilities and accountability.

7

Public Corporation

Medium

  • Not civil servants.
  • Not part of Scottish Government but Board appointed by ministers.
  • Established by statute or under Companies Act.
  • Strategic framework set by Ministers.
  • Focus on commercial activities.
  • Ministers still have power to direct.

Higher

  • As the employer of its staff who are not civil servants, the NDPB has greater scope to create, sustain and develop expertise.

Medium

  • Powers and duties set out in statute, but boards appointed by Ministers.
  • Ministers set the strategic framework for the body.

Medium

  • Functions are generally set out in statute rather than a framework document, and as such may be more difficult to vary significantly at short notice.
  • If set up as corporate entity, Directors have duty of care to corporate entity. This may make it harder to reach agreement on changing role.

Medium

  • Delegated responsibility for day to day operations subject to Ministers' strategic oversight.
  • Ministers agree corporate at business plans.

Lower

  • Likely to require powers under statute to be agreed
  • Separate legal entity needs to be created.
  • Ministers may be able to sponsor without wider parliamentary approval.
  • Potential requirement for enabling legislation plus creation and registration of company.

Higher

  • Clear definition of roles, responsibilities and accountability.

Contact

Email: james.hemphill@gov.scot

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