Financial Transparency (SCO0001)
Action Plan: Scotland, United Kingdom Action Plan
Action Plan Cycle: 2017
Lead Institution: Financial Strategy Directorate
Support Institution(s): UK Government (interaction between UK and Scottish Fiscal/Budget processes), Scottish Local Authorities, Scottish Colleges and Universities, and Scottish Government Public Bodies Civil Society, Scottish Parliament, Private Sector, Academics
Policy AreasAnti Corruption and Integrity, E-Government, Fiscal Openness, Local Commitments, Open Parliaments, Public Procurement, Publication of Budget/Fiscal Information
Issue to addressed: The Scottish budget and fiscal environment is changing significantly as a result of the new powers being devolved to Scotland through the 2012 and 2016 Scotland Acts. As a result of the Scottish Government gaining significant tax and borrowing responsibilities, there is growing public and Parliamentary interest in tax policy and how it compares to other parts of the UK, in economic performance which influence tax revenues, in borrowing decisions, and in contractual and spending patterns all of which support public services in Scotland. Primary objective: To clearly explain how public finances works and provide an accessible presentation of public financial flows into and out of the Scottish Government, including to local authorities, commercial and third sector organisations. We will develop, with partners, ways to provide financial, procurement and commercial information that is coherent, consistent and in a format that is useful and easy to understand for communities, the 3rd sector and citizens. This will include consideration of how national budget information could complement participatory budgeting at local and national levels. Short description: The Scottish Government will seek to improve the presentation and clarity of the financial, procurement and commercial information it publishes so that members of the public can understand it better. OGP challenge: In delivering this commitment the Scottish Government will advance its commitment to all 4 OGP values of Transparency, Accountability, Participation and Technology & Innovation. The delivery of this commitment will result in the clarity, format and range of publically available information being enhanced, as well as implementing a refreshed set of modern scrutiny and accountability arrangements with the Scottish Parliament around Scottish public sector finances.
IRM End of Term Status Summary
Commitment 1. Financial Transparency
The Scottish Government will seek to improve the presentation and clarity of the financial, procurement and commercial information it publishes so that members of the public can understand it better.
1. The Scottish Government will undertake a review of the content and format of the information that it currently publishes on its websites, to allow us to then improve the clarity and coherence of the information that we publish (including providing data in more accessible formats).
2. A joint review group between the Scottish Government and Scottish Parliament (including 8 external public/private sector experts) will be established to carry out a fundamental review of the Scottish Parliament's budget process following the devolution of further powers in the Scotland Act 2012 and Scotland Act 2016. By June 2017, the group will then bring forward proposals for a revised budget process for consideration by the Finance Committee and the Cabinet Secretary for Finance and the Constitution (implementation of the new process is expected to be for the 2018-19 budget €“ starting in summer 2017).
3. The Scottish Government will consider what new financial reporting information it needs to develop and start publishing, both as a result of the devolution of new fiscal powers through the Scotland Act 2012 & 2016, but also to reflect a modern and open approach to public finances. The initial phase of this work (the review) will take place 2017-18 and then implementation of these changes will begin in financial year 2018-19.
4. The Scottish Government will develop an open contracting strategy to support the publication of procurement and commercial reporting information in a manner that is accessible to all, while taking advantage of developing data standards.
Overall Objective & Relevance
To date, Scottish Government financial information has been presented as required for parliament, and thus requires a high degree of 'financial literacy' to understand Interview with Doreen Grove, Scottish Government, 21 June 2017, via Skype . The aim of this commitment is therefore to make financial information more comprehensible and usable, in conjunction with budget reforms, and ultimately to help citizens understand better the flow of public money, including through the use of technology and involvement of end users in how they want information to be presented. Key targets include financial journalists and citizens involved in participatory budgeting Interview with Doreen Grove, Scottish Government, 21 June 2017, via Skype .
At the same time, the Scottish budget and fiscal environment is changing significantly as a result of the new powers being devolved to Scotland through the 2012 and 2016 Scotland Acts. The new arrangements give the Scottish Government and Parliament more control over public finances and are much more complex than the existing process, which was designed primarily to manage a block grant from the UK Government. In particular, there is now a much greater degree of volatility and uncertainty in the budget process in Scotland Scottish Parliament (2017) Budget Process Review Group Interim Report, 10 March (last accessed 14 July 2017) http://www.parliament.scot/S5_Finance/Reports/2017.03.10_BPRG_Interim_Report_(1).pdf .
According to the Government-commissioned Report on the Future Delivery of Public Services in 2010 (the so-called Christie Report), the changes in Scotland's fiscal environment are compounded by increased pressure on budgets, as well as new demographic and social pressures and the effects of the global economic downturn. As the Christie report notes:
'Unless Scotland embraces a radical, new, collaborative culture throughout our public services, both budgets and provision will buckle under the strain [€¦] Contentious issues such as the continuation of universal entitlements must be considered openly and transparently, rather than in the current polarised terms.' Commission on the Future Delivery of Public Services (2011) Report on the Future Delivery of Public Services chaired by Dr Campbell Christie (last accessed 14 July 2017) http://www.gov.scot/Publications/2011/06/27154527/0
As a result, the Scottish Parliament's Finance Committee recommended in March 2016 that
'Scottish Parliament and Scottish Government officials work together to review the budget process in the first instance with a view to bringing forward proposals for any changes for consideration by our successor and Ministers.' Scottish Parliament Finance Committee (2016) Legacy Paper, 6th Report, 2016 (Session 4) (Last accessed 14 July 2017) http://www.parliament.scot/S4_FinanceCommittee/Reports/FIS042016R06.pdf
The aim of milestone 2 is therefore to develop proposals for a revised budget process which addresses this increased level of volatility and uncertainty as well as the need for robust parliamentary and wider public scrutiny.
With regards to open contracting (milestone 4), the focus to date on procurement reform in Scotland has been on 'reducing the administrative burden and making it easier for businesses to engage with their local contracting authorities' Public Contracts Scotland (2016) Progress Report for 2014 and 2015 (last accessed 14 July 2017) http://www.publiccontractsscotland.gov.uk/Guides/Guide_Download.aspx?id=2281 , rather than on transparency per se. The government's Open Data Strategy, published in 2015, made no specific reference to contracting and procurement data. Milestone 4 therefore aims to complement the existing open data strategy by helping the public identify who is delivering government contracts and how well these contracts are performing Open Contracting in the Scottish Government: Update €“ May 2017 (last accessed 14 July 2017) http://www.gov.scot/Topics/Government/Procurement/OpenContracting .
Overall, this commitment is relevant primarily to the OGP value of Access to Information, in particular, milestones 1, 3 and 4 which seek to better explain how public finances work and provide accessible presentation of public financial flows into and out of the Scottish Government, including to local authorities, commercial and third sector organisations. Providing citizens with information that is coherent, consistent and in a format that is easy to use should enable citizens to clearly understand how their tax money is spent and to support more informed policy making, including through participatory budgeting at the national and local levels (see commitment 4).
Moreover, milestone 4 is also relevant to the OGP value of Technology & Innovation for Transparency & Accountability, by seeking to make more information public in ways that enable people to both understand what their government does and to influence decisions. For example, the open contracting strategy will mean that the UK government's Open Government Licence will now apply to Scottish Government information published on Public Contracts Scotland (PCS) (including contract notices, contract award notices and the contract register), while contract and award notices will be available to download in an open data format (XML) Open Contracting in the Scottish Government: Update €“ May 2017 (last accessed 14 July 2017) http://www.gov.scot/Topics/Government/Procurement/OpenContracting .
However, the direct relevance of milestone 2 to OGP values is unclear. The interim report of the parliament's Budget Process Review Group identifies five key themes for further consideration, focussing on the effectiveness of the budget process and of outcome-based scrutiny (including the link between budgets and the National Performance Framework (NFP) (see commitment 2)). The focus of the review process is therefore on internal budgeting processes within government and between the government and parliament, with little reference to public-facing elements.
Specificity and Potential Impact
The overall level of specificity for this commitment is low. The commitment identifies the primary institution which is responsible for implementation, although no specific civil society partners are mentioned. The milestones also define start and end dates for activities, although in a number of cases, completion dates are beyond the timeframe of the action plan implementation period (December 2017).
The commitment and milestone language generally describes activities that are objectively verifiable, but some of the milestones are not clearly measurable or directly relevant to the overall commitment objective. This applies in particular to milestones 1 and 3. For example, milestone 1 does not identify a concrete output (it is not clear what the outcome of the review will look like) and does not identify precisely what types of information will be reviewed. Meanwhile, milestone 3 only commits to 'consider(ing) what new financial reporting information it needs to develop and start publishing' without a set of defined activities. The fact that the process is due to be completed only by the spring of 2019 further limits the level of specificity.
Despite describing concrete outputs to be delivered by the end of 2017, milestones 2 and 4 also lack specificity. Milestone 2 describes the proposed budget review process only in general terms and, as discussed above, is only partially relevant to the overall objective of increasing financial transparency, given that the focus is largely internally-facing (reforming budgeting processes). The wording of milestone 4, meanwhile, is vague and leaves open to interpretation the specific mechanisms by which the government aims to ensure that useable, up-to-date and relevant contracting data is made available to the public. Although a recent update to the strategy development process Open Contracting in the Scottish Government: Update €“ May 2017 (last accessed 14 July 2017) http://www.gov.scot/Topics/Government/Procurement/OpenContracting provides more detail, this is not clearly articulated in the action plan itself.
The potential impact of the commitment is moderate. As noted above, the commitment addresses a well-defined existing challenge (namely the changing fiscal environment in Scotland on the one hand, and the need to provide citizens with access to clear financial, procurement and commercial information in light of these changes, on the other). Milestone 4 meanwhile could fill an important gap not covered by Scotland's Open Data Strategy, although this will depend on the content of the proposed new strategy. Combined, the different activities presented would contribute significantly to the objective of enabling citizens to better understand how public finances work in Scotland and would serve to stretch existing government practice in the area of financial transparency. Furthermore, the commitment has clear links to other commitments in the action plan, most notably commitment 2 (Measuring Scotland's Progress), commitment 4 (participatory budgeting) and commitment 5 (increasing participation), thus contributing to a coherent plan of action for open government.
However, potential impact suffers due to the lack of specificity of some of the milestones, as discussed above, making it difficult to judge how certain activities will ultimately benefit citizens. Furthermore, in order to be transformative and to contribute more directly to enhancing public accountability, the commitment would need to support the capacity of civil servants to produce information as intended, and the capacity of citizens to use the information in meaningful ways. While Doreen Grove, the OGP Focal Point for the Scottish Government, noted that both elements would form part of the planned reforms Interview with Doreen Grove, Scottish Government, 21 June 2017, via skype , these activities are not explicitly mentioned in the action plan.
Overall, there has been substantial progress on the implementation of this commitment, with the completion of two out of the four milestones. For the other two milestones, progress is limited.To some extent, this is due to the low specificity of these milestones, making it difficult to ascertain what was intended and hence how much progress has been made, as well as the fact that their expected completion dates fall after the action plan implementation period. But it is also a result of political events during the year including the snap UK national elections in June 2017 and the ongoing Brexit negotiations, which meant that time were diverted to other priorities.
The Scottish Government will undertake a review of the content and format of the information that it currently publishes on its websites, to allow us to then improve the clarity and coherence of the information that we publish (including providing data in more accessible formats).
Progress on this milestone is difficult to ascertain given the lack of detail on what exactly was envisaged. As acknowledged by the government, there was no measurable progress during the first half of 2017 other than internal discussions on the scope of work and resource requirements OGP Scotland July 2017 update http://www.gov.scot/Topics/Government/OGP .
Progress since the middle of 2017 has picked up. Although the government did not conduct an in-depth review of the content and format of the information that it publishes, as stated in the milestone, it did begin to implement some changes to the way it publishes forward-looking financial planning information. Building on the government´s publication of 'Scotland´s Finances: key facts and figures' http://www.gov.scot/Resource/0051/00511587.pdf in December 2016 (a first attempt to better educate the public on Scotland´s financial system) the government has developed what it terms 'Scotland´s first digital budget', through a finance portal on the Scottish Government website, launched on the 14th December 2017 See: https://beta.gov.scot/budget/ . The portal, which was initially piloted as part of the launch of the Scottish Government´s 2017/18 Programme for Government, acts as the interim hub for all the government´s financial information in connection with the launch of the budget, including educational material and the government´s budget proposals. Prior to launching the finance portal, the government gathered feedback on the usefulness of the information from members of the Open Government Network, including the Democratic Society and the Open Knowledge Group, towards the end of November 2017 Interview with John Nicholson, Aileen Wright and Gavin Henderson, Scottish Government, 2 November, Edinburgh . In addition, the government published a discussion paper, entitled 'The Role of Income Tax in Scotland's Budget' on 2nd November 2017, which provides background information to help inform the public debate on the future use of Scotland´s recently acquired income tax powers http://www.gov.scot/Resource/0052/00527052.pdf .
Other initiatives which the government is considering as part of this milestone include a mapping tool which shows the location of investment and infrastructure projects to allow citizens to understand locally how the government is impacting their lives, and a tool to help citizens understand how tax changes affect them (through, for example, a calculator) Interview with John Nicholson, Aileen Wright and Gavin Henderson, Scottish Government, 2 November, Edinburgh . Another option under consideration for the longer term is purchasing a unique domain name, and linking this to the finance portal URL OGP Scotland October 2017 update http://www.gov.scot/Topics/Government/OGP . However, these actions have not yet been implemented.
Thus, while the government has implemented some changes and has additional plans to further improve the depth and accessibility of financial information it publishes in the long term, it did not conduct the initial review as stated in the milestone. Progress on this milestone in 2017 has therefore been limited.
A joint review group between the Scottish Government and Scottish Parliament (including 8 external public/private sector experts) will be established to carry out a fundamental review of the Scottish Parliament´s budget process following the devolution of further powers in the Scotland Act 2012 and Scotland Act 2016. By June 2017, the group will then bring forward proposals for a revised budget process for consideration by the Finance Committee and the Cabinet Secretary for Finance and the Constitution (implementation of the new process is expected to be for the 2018-19 budget €“ starting in summer 2017)
This milestone was achieved within the stated timeframe. The Budget Process Review Group (BPRG), comprising Scottish parliament and government officials as well as 8 external members The 8 external members are: Dame Sue Bruce, Non-Executive Director, SSE PLC; Professor Mike Danson, Professor of Enterprise Policy, Heriot-Watt University; Caroline Gardner, Auditor General for Scotland; Elaine Lorimer, Chief Executive, Revenue Scotland; Professor James Mitchell, Director of Academy of Government, University of Edinburgh; John Ireland, Chief Executive, Scottish Fiscal Commission; Dr Angela O'Hagan, Gender Budgeting Specialist, Glasgow Caledonian University; Don Peebles, Head of the Chartered Institute of Public Finance and Accountancy Scotland. See: http://www.parliament.scot/S5_Finance/Reports/BPRG_-_Final_Report_30.06.17.pdf , was established in September 2016 and met 11 times between September 2016 and June 2017. The group´s interim report was published on 10 March 2017 in the form of a consultation document http://www.parliament.scot/S5_Finance/Reports/2017.03.10_BPRG_Interim_Report_(1).pdf . Doreen Grove, the Scottish Government OGP point of contact, and Lucy McTernan from the SCVO gave evidence to the review group on 30 March 2017 on open government and involvement of civil society in the budget process OGP Scotland July 2017 update http://www.gov.scot/Topics/Government/OGP . The group´s final report was published on 30 June 2017, with a focus on five core areas: (i) a full year approach to budget scrutiny giving committees more flexibility to incorporate budget scrutiny including public engagement into their work; (ii) a continuous cycle of budget scrutiny with an emphasis on the impact of budgetary decisions over a number of years; (iii) an output/outcome focus over the long term, including scrutiny of equalities outcomes; (iv) a long term outlook with more focus on prioritisation, addressing fiscal constraints and the impact of increasing demand for public services; and (v) more focus on the interdependent nature of policies which the budget is seeking to deliver http://www.parliament.scot/S5_Finance/Reports/BPRG_-_Final_Report_30.06.17.pdf .
The findings of the report were discussed by the parliament´s finance committee on 22 September 2017 https://www.youtube.com/watch?v=9vt2n5OgABw . According to the parliament´s September/November 2017 External Experts Panel newsletter, the Cabinet Secretary stated his intention to implement the recommendations as quickly as possible including increasing the transparency of budget documentation in time for Draft Budget 2018-19. However, most of the recommendations will be implemented subject to parliamentary approval in time for scrutiny of the Budget for 2019-20. http://www.parliament.scot/S5_Finance/General%20Documents/Newsletter_Sept-Oct_2017.pdf In the meantime, the government announced in the 22 September 2017 that the budget date had been postponed to 14 December to allow additional time for parliament to scrutinise the budget https://www.wired-gov.net/wg/news.nsf/articles/Budget+date+announced+22092017150500?open .
The Government stated that, along with the measures discussed under milestone 1 above, they are now presenting all tables from the budget online in xml format (where these had previously been in pdf format). In addition, all information that was previously only given to parliament to support their scrutiny is now be made public. While this information was always in the public domain (via the parliament), presenting this via the new government portal, in their view, contributes to further improving the accessibility of information Interview with John Nicholson, Aileen Wright and Gavin Henderson, Scottish Government, 2 November, Edinburgh .
The Scottish Government will consider what new financial reporting information it needs to develop and start publishing, both as a result of the devolution of new fiscal powers through the Scotland Act 2012 & 2016, but also to reflect a modern and open approach to public finances. The initial phase of this work (the review) will take place 2017-18 and then implementation of these changes will begin in financial year 2018-19.
Progress on this milestone has been limited. Internal discussions started in March 2017 on interactions with corporate reporting and accounting in 2017-18 and the finance team began gathering evidence of good practice in other departments/jurisdictions, including liaison with the UK Treasury OGP Scotland July 2017 update http://www.gov.scot/Topics/Government/OGP .
In September 2017, the government produced a background note highlighting the range of financial reporting information it currently produces See second half of document: http://www.gov.scot/Resource/0052/00526352.docx . In addition, the government adapted the accounts it produces, including the provision of additional accounts on devolved taxes for the 2016/17 accounts. The accounts have been made accessible via the new finance portal for the budget, meaning that something citizens would have previously had difficulty in finding is more easily available. As noted by the Auditor General:
The Scottish Government has made some improvements to the presentation of this year's consolidated statements, which should help the reader's understanding of individual Scottish Government portfolios' financial performance. I welcome this but there is scope to go further to make the accounts more accessible to the public and Parliament http://www.gov.scot/Resource/0052/00525250.pdf
In terms of work to come beyond the timeframe of this action plan, the Auditor General also welcomed the government´s commitment to producing a consolidated account to cover the whole public sector in Scotland including local government borrowing and public sector pension liabilities in 2018 (for 2016/17 as a 'shadow-year') http://www.gov.scot/Resource/0052/00525250.pdf .
In sum, while the government has made some initial steps to provide more financial reporting information, progress to date has been limited. As acknowledged by the Government: 'On digital reporting we are a little bit behind where we would like to be. There is a plan for a new website in the new digital strategy but at the moment we are still working on the old website which is limiting.' Interview with Interview with John Nicholson, Aileen Wright and Gavin Henderson, 2 November, Edinburgh
The Scottish Government will develop an open contracting strategy to support the publication of procurement and commercial reporting information in a manner that is accessible to all, while taking advantage of developing data standards.
This milestone was achieved within the stated timeframe. In the first half of 2017, the Scottish Government completed initial technical steps to meet the criteria for reaching level 3 of the 5 star schema specified in the Open Data Strategy, namely: adding the Open Government License to the material published on the Public Contracts Scotland (PCS) website, making published contract and award notices available in a downloadable, open data format, and making the invitation to tender documents published via the PCS mailbox permanently available, including after the closing date for expressions of interest has passed http://www.gov.scot/Resource/0052/00524238.pdf .
The Open Contracting Strategy was published in September 2017, ahead of schedule http://www.gov.scot/Resource/0052/00524238.pdf . The strategy sets forth a plan for improving the type and format of procurement information which the Scottish government publishes. This entails moving from publishing basic information in a 3 star format as it currently does (as measured by the Open Contracting Partnership´s Open Contracting Data Standard (OCDS OCDS sets out three levels for disclosure (basic, intermediate and advanced), alongside a 5* framework for the technical approach to data publication for publishers to self-assess themselves. http://standard.open-contracting.org/latest/en/implementation/levels/#how-to-publish-5-approach ), to publishing an intermediate level of information in a 4 star format by the end of 2019. To achieve this, the strategy outlines a series of workstreams to allow for phased implementation, including making changes to existing policies and processes, reviewing Scottish Government eCommerce systems, and developing an open contracting portal in order to provide a central location for our procurement information.
Early results: did it open government?
Access to Information: Marginal
The aim of this commitment is to make financial information more comprehensible and usable, in conjunction with budget reforms, and ultimately to help citizens understand better the flow of public money in light of the changing fiscal environment in Scotland. While the commitment was rated as having moderate potential impact, the early results suggest that the activities as implemented have resulted in a marginal opening of government practice in this area within the timeframe of the action plan.
As a result of the actions implemented in 2017, the government has disclosed more information and in some cases improved the accessibility of existing financial information disclosed to the public. The government finance team pointed to the tax paper, published in November 2017, as a good example and a step change in the way the government engages with the public about taxation, before decisions have been made Interview with John Nicholson, Aileen Wright and Gavin Henderson, Scottish Government, 2 November, Edinburgh . Nevertheless, there is still a long way to go in terms of making a broader range of financial information available in a way which is not only accessible to the public, but that can also be used to formulate and resolve specific questions. The slow start was recognised by Doreen Grove, who noted during the OGP steering Group meeting on 23 June that: 'This is the commitment we have taken longest to get moving on because it is quite complicated' Doreen Grove, OGP steering group meeting livestream, 23 June 2017 https://forum.opengovernment.org.uk/conversations/968 .
During most of 2017, discussions on the types of information to be published were conducted internally within government, with little or no involvement from civil society to discuss how the public may want to use such information. The open contracting strategy was developed with input from sector representatives but with little engagement with wider civil society. As acknowledged by both government and civil society representatives, attempts to engage in the latter case were challenging because of the technical nature of procurement and limited communication on both sides Interview with John Nicholson, Aileen Wright and Gavin Henderson, Scottish Government, 2 November, Edinburgh; Interview with Paul Bradley, SCVO, 3 November, Glasgow . As a result, according to Lucy McTernan from the SCVO, there was little visible sign of activity during much of the year Interview with Lucy McTernan and Ruchir Shah, SCVO, 1 November, Edinburgh . Nevertheless, the government later convened a meeting with civil society following publication of the open contracting strategy on 13 December 2017 to discuss the types and formats of procurement information stakeholders would like to see published