Infrastructure Investment Board: terms of reference

Purpose

To act as a ‘Portfolio’ Board for the Infrastructure Portfolio and provide oversight for the development of the Scottish Government’s (SG) infrastructure strategy. Infrastructure Investment Board (IIB) advice provides the context in which Ministers make capital budget decisions and a baseline for capital budget impact assessments. The work of IIB is evolutionary in nature, starting with the current infrastructure pipeline, capital budget and capital SR and identifying gaps and opportunities to refine the portfolio of infrastructure over time. This includes:

• infrastructure definition and the infrastructure delivery cycles – with a view to improving how the SG prioritises infrastructure investment across areas and to improve the development and delivery of individual projects. This takes a wider view, beyond the published pipeline, crucially to include ongoing maintenance/asset replacement requirements
• building on the prioritisation of projects and programmes within policy areas and the existing pipeline of projects and programmes, IIB is expected to refine the portfolio of projects and programmes that balances ministerial priorities, statutory (including safety) requirements and mitigates the corporate infrastructure risk
• reviewing, by exception, infrastructure business cases. The Infrastructure Business Case Group (IBCG) will review business cases and determine which cases require further, focused discussion by IIB. The business case review group will be comprised of leads for each of the five cases and where they deem a business case needs to be considered by IIB they will provide advice on each of the cases, analogous to the ETIM approach. This is a scrutiny role IIB takes over from ETIM for infrastructure projects – by reviewing all business cases for infrastructure projects and programmes where no formal governance board exists, the IBCG will provide confidence that all business cases are undergoing the same level of scrutiny. IIB may choose to escalate business cases to ETIM where specific conditions are met
• ensuring the right processes are in place and followed, along with strong governance and quality data, to support a high level of confidence in investment decision making and infrastructure delivery in the Scottish Government

Through challenge and support, IIB has a capacity-building and culture-change role, recognising organisational weaknesses in strategic planning and infrastructure project development and management.

Scope

IIB will consider papers on topics and issues within its scope. As of 1 February 2025 (change to date this remit formally agreed), the following is in scope for IIB:

• infrastructure strategy
• oversight of the development of portfolio asset strategies
• development/oversight of the prioritisation of the infrastructure pipeline including place-based investment decisions
• process improvement to support better infrastructure design and delivery
• oversight of the corporate risk on infrastructure

Authority

IIB’s authority to provide advice on matters within its scope comes through the corporate governance framework.

Individual responsibilities

IIB members are expected to:

• come to Board meetings fully briefed on the issues to be considered at each meeting

• maintain objectivity when reviewing the infrastructure pipeline and business cases and ensuring advice/recommendations provided are not based solely on policy portfolio interests but shaped by infrastructure knowledge and wider government priorities
• promote capacity building in DG ‘hubs’ and beyond to support the infrastructure portfolio management approach
• champion better delivery and governance of place-based and cross-portfolio joint investments
• champion the development and implementation of asset strategies across all parts of the SG to support long-term infrastructure planning

Support for members and standing attendees

Infrastructure Division, as portfolio office and Board secretariat, will support the delivery of all Board meetings, ensuring preparation of appropriate agenda, papers, and minutes.

Specifically, the portfolio office/secretariat will:

• commission and prepare papers for Board meetings;
• coordinate inputs and consult with key Governance structures, programmes, and projects;
• record decisions and actions and track all follow-up.

The Infrastructure Advisory Group (IAG) will support the business of IIB. IIB members are asked to nominate leads who will work on the IAG and support them to prepare for IIB meetings. These leads will be the day-to-day contacts with the Infrastructure Division and should be responsible for the asset strategies in the respective areas to be able to advise the IIB member on key considerations for prioritising infrastructure projects and mitigating the area-specific infrastructure risks. This also applies to cross-cutting areas like economy and net zero where input is required to ensure gaps and risks are identified.

The areas leading the review of business cases are the same as are currently in place for ETIM.

Attendance and substitutes

Members are expected to attend meetings whenever possible. Where a member is unable to attend, they should consider whether, for the items under discussion, it would be appropriate to send a substitute. The portfolio office can provide advice on this. All substitutes must be both sufficiently expert and sufficiently senior to contribute effectively to the discussion.

Meetings

The IIB will meet on a quarterly basis – but more frequent meetings may be convened if necessary.

Self-evaluation

At least once a year – with support from the portfolio office – the Board will review its:

• terms of reference
• scope
• performance and effectiveness - including that of subgroups
• membership
• roles and responsibilities

Agendas

Drafted by the portfolio office and approved by the Chair.

Members and standing attendees can propose items to the portfolio office. The Board sits below ET in Investment Mode in the Corporate Governance Structure and should escalate issues as required to that Board. The Board sits below ET in the Corporate Governance Structure and escalates issues as required to ET (specifically ETIM).

Escalation

The Board is expected to provide ETIM with six-monthly updates:

• risks and opportunities in the current delivery pipeline and options for reprioritisation - includes assessment of the corporate risk on infrastructure
• delivery performance of projects - drawn from Infrastructure pipeline reporting
• key points arising from discussion of the business cases

• assessments of organisational capability and capacity to develop and deliver infrastructure projects

The Infrastructure Advisory Group (IAG) and the Infrastructure Business Case Review Group (as well as portfolio governance groups in Transport and Health) escalate issues to IIB. This includes issues with business cases and significant issues affecting the development of asset strategies.

The Board may choose to escalate consideration of business cases to ETIM where the business case meets the following conditions:

• a novel and/or contentious project/programme
• includes a need to commit to recuring spend
• following consideration of any business case by IIB or IBCG an AO or the Permanent Secretary can also invite ETIM to endorse the business case

Delegation

The Board may choose to delegate issues to the IAG to consider ahead of coming back to the Board for decision.

The Board will formally delegate the initial consideration of outline business cases, and some full business cases if requested by the portfolio, to the Infrastructure Business Case Group.

Membership

The Director of Public Spending chairs meetings. Membership is drawn from Directors General (DGs) with a cross-cutting or portfolio interest in the infrastructure pipeline and strategy. Some DGs may choose to delegate their portfolio interests to relevant directors or deputy directors. The DGs for Net Zero and Economy are asked not to delegate, to make sure cross-cutting priorities are given proper consideration.

• Director of Public Spending: IIB Chair
• DG Economy: cross-cutting responsibility for economy prioritisation - portfolio interest in regeneration and planning, with planning covered by the Chief Planner
• DG Net Zero: cross-cutting responsibility for Net Zero prioritisation - portfolio interest in environment, energy and transport, with transport covered by the CEO of Transport Scotland
• Chief Planner: cross-cutting responsibility for the place-based approach to infrastructure development
• Deputy Director of Health Infrastructure: portfolio interest in the health estate
• Director of  Justice: portfolio interest in justice estates
• Director of Education Reform: portfolio interest in education estates
• Deputy Director More Homes: portfolio interest in housing
• Chief Executive, Transport Scotland: portfolio interest in transport
• Chief Surveyor: responsible for construction procurement and the Single Scottish Estate Programme
• Deputy Director of Procurement and Programme and Project Management Policy and Strategy: responsible for project and programme management
• Chief Executive Scottish Futures Trust: provides external expert advice and challenge
• Non-Executive Director: provides assurance and challenge
• SG Board Secretary: provides Executive Team support and governance

Standing attendees

These are:

• Deputy Director for Infrastructure
• Head of Infrastructure Unit
• Head of Capital Budget Unit

Internal and external stakeholders may also be invited to attend and deliver agenda items when appropriate.