Financial and Performance Transparency (SCO0006)
Action Plan: Scotland Action Plan 2018-2020
Action Plan Cycle: 2018
Lead Institution: Scottish Exchequer (Scottish Government) and related Scottish Government teams including: Public Spending Infrastructure and Investment Financial Management Directorate Performance and Strategic Outcomes Tax Scottish National Investment Bank Economy
Support Institution(s): State actors involved Active Partners could include:Scottish Parliament 41 Scottish Fiscal CommissionRevenue Scotland CSOs, private sector, multilaterals, working groups Active Partners could include: Scottish Open Government Partnership network Young Scot Transparency International Global Institute of Fiscal Transparency OECD
Policy AreasAnti-Corruption, Fiscal Openness, Local Commitments, Marginalized Communities, Open Parliaments, Oversight of Budget/Fiscal Policies, Participation in Lawmaking, Public Participation, Public Participation in Budget/Fiscal Policy, Public Procurement, Publication of Budget/Fiscal Information, Regulatory Governance
Commitment 1: Financial and performance transparency
December 2018 – 2020
Lead implementing agency/actor Scottish Exchequer (Scottish Government) and related Scottish Government teams including: • Public Spending • Infrastructure and Investment • Financial Management Directorate • Performance and Strategic Outcomes • Tax • Scottish National Investment Bank • Economy Commitment description What is the public problem that the commitment will address? New powers were devolved to Scotland through the 2012 and 2016 Scotland Acts. These provided significant additional tax, spending and borrowing responsibilities for the Scottish Government. In addition, there is growing public and Parliamentary interest in financial transparency and how financial management relates to performance against the National Performance Framework and Sustainable Development Goals. This includes tax policy, including how it compares to international comparators and to other parts of the UK, in economic performance which influences tax revenues and demand for public services, in borrowing decisions, and in contractual and spending patterns all of which support public services in Scotland. The establishment of a Scottish National Investment Bank provides an opportunity to establish trusted governance from the outset. Similarly, this applies to the newly-established Scottish Exchequer.
What is the commitment? This Scottish Government commitment is: • To apply open government policies and practice to the further design and implementation of the newly established Scottish Exchequer and the development of the Scottish National Investment Bank to ensure they develop in line with international good practice on open government. It is proposed that the Scottish National Investment Bank’s operations include an Ethical Statement, and a role for citizen involvement in an Advisory Group. Both of these proposed approaches have the potential and intent to inform thinking around the Bank’s governance and wider accountability as well as improving citizen participation. • To seek the views of stakeholders and the wider public about how to make Scotland’s public finances more transparent and accessible in order to promote public discussion, debate and participation in financial and policy decision making. This will include learning from young people, primarily through working with YoungScot. The Scottish Government will work with partners and expert civil society actors to review and incorporate good practice on transparency, accountability and citizen engagement into the work of the Scottish Exchequer. This will include a number of round table events to bring together experts on fiscal transparency to share learning and understanding. • To build on the work of the first Open Government Partnership Action Plan, in order to improve the effectiveness of budgetary information in communicating with external audiences. This commitment will also include building on the work that is ongoing to deliver the recommendations of the recent Budget Process Review Group (BPRG) Report 2017. The report proposed that the Scottish Parliament’s budget process should have the following four core objectives: • to have a greater influence on the formulation of the Scottish Government’s budget proposals
• to improve transparency and raise public understanding and awareness of the budget • to respond effectively to new fiscal and wider policy challenges • to lead to better outputs and outcomes as measured against benchmarks and stated objectives. We, the Scottish Government, will begin with developing accessible financial information for young people, as we know from feedback that they do not find current information on public finances informative. So, taking action to build understanding now will be an important foundation for future citizenship. The first stage will involve project working with young people in deliberative workshops over the coming 6 months to provide insights into the questions they wish to see addressed. One key aim of work to implement the BPRG recommendations (outlined above) will be to find ways of making clearer links between public finance decisions and the National Performance Framework and Sustainable Development Goals. This commitment will also include: • consideration of how budget information could complement participatory budgeting • consideration of how the strategy and processes of the Scottish National Investment Bank are able to be understood and influenced by citizens • improving transparency on what government spends and the contracts and services it procures. We will explore if and how the existing data can be shared to help citizens understand how public funds are spent and making this information more accessible – using more visual presentations of the information, and plain language.
How will the commitment contribute to solving the public problem? Those in Scottish Government who hold the financial information and support the decision-taking processes will understand from others – initially, from young people and also from experts – the questions they have about public finances. They should then be able to use that understanding to improve financial information that is made publicly available. Importantly this work will support the aim for the Scottish National Investment Bank to fulfil a leadership role in terms of building public trust, diversity, equality, transparency and accountability. Publishing better information on procurement processes and spend should help people better understand how the money is used and accounted for, and more easily be able to understand information that is published. Why is this commitment relevant to Open Government Partnership values? In delivering this commitment the Scottish Government will advance its commitment to all four Open Government Partnership values of Transparency, Accountability, Participation and Technology and Innovation. The delivery of this commitment will build on the new financial information produced by the Scottish Government through its new Medium Term Financial Strategy, its new Fiscal Framework Outturn Report, the Scotland’s Finances publication and the redesigned Scottish Budget document, which aim to increase the clarity, format and range of publicly available information on how Scotland’s Budget is agreed and spent. Additional information This commitment is core to the values in Scotland’s National Performance Framework and supports the delivery of the Sustainable Development Goals by seeking to articulate more clearly the link between performance information and fiscal decisions. It is a fundamental part of the Scottish Government’s commitment to delivery of new devolved powers in Scotland in a ways that are transparent and open.
Milestone Activity with a verifiable deliverable Start Date End Date: Scottish National Investment Bank adopts Open Government principles and culture and explores setting up the following: • Citizen Advisory Group • Develops Ethical Statement with public participation and input Spring 2019 2020 Young people’s understanding of Public Finances Report – with YoungScot – will be published. December 2018 Summer 2019 The Spending Review will be completed by December 2019 in time for Budget 2020-21. A new development in transparency for the Spending Review will be the publication of a Spending Review Framework by June 2019, which will set out the economic and political context, the criteria which will govern the assessment of budgets and the process and timetable for the review. This is in line with the Budget Process Review Group Report (recommendation 4), and is intended to amongst other things to support Parliamentary Committees in undertaking ‘a constructive dialogue with the Government, public bodies and stakeholders… in order to influence the outcome of the spending review’. December 2018 Spring 2019
We have committed to progress on making closer links with outcomes and the budget over the years ahead. Key milestones are each successive Scottish Budget, which would usually be published in December each year for the forthcoming financial year. Indicators of progress would be: • commentary and analysis in the Budget document showing how spending contributes to intermediate outputs, measures and milestones set for new policies – with the outcomes those policies we are aiming to achieve set out clearly at the time they were announced; • a clearer link between policies and plans and the Budget document to show how the allocation of resources contributes to priorities, long-term aims and outcomes. December 2018 Summer 2019 Make links between budget and outcomes: Publish more information about Scotland’s progress in relation to the National Performance Framework and Sustainable Development Goals Summer 2019 Ongoing Publish Scottish Government procurement-related spend information. December 2018 December 2019
Publish Scottish Government contract documentation, starting with large collaborative frameworks. November 2018 June 2019 Consult with civil society on how best to make published procurement information useful and accessible to a wide audience. December 2018 May 2019
Contact information Name of responsible person from implementing agency Doreen Grove Title, Department Head of Open Government, Ingage, Scottish Government Email and Phone Doreen.firstname.lastname@example.org 07767343230 Leads: Scottish Exchequer (Scottish Government) and related Scottish Government teams including: Eleanor Ryan – Director of Budget and Sustainability Eleanor.email@example.com John Nicholson – Budget and Sustainability – John.firstname.lastname@example.org Aileen Wright - Financial Management Directorate – email@example.com Tim Ellis – Strategy, Performance and Outcomes – Tim.firstname.lastname@example.org Scott Bell - Scottish Procurement and Commercial Directorate – email@example.com Aiden Grisewood – Taxation – firstname.lastname@example.org Rachel Van Kempen - Scottish National Investment Bank – Rachel.email@example.com Other Actors Involved State actors involved Active Partners could include: • Scottish Parliament 41 • Scottish Fiscal Commission • Revenue Scotland CSOs, private sector, multilaterals, working groups Active Partners could include: • Scottish Open Government Partnership network Young Scot • Transparency International • Global Institute of Fiscal Transparency • OECD
IRM Midterm Status Summary
1 Provide Financial and Performance Transparency
Language of the commitment as it appears in the action plan:
“This Scottish Government commitment is:
- To apply open government policies and practice to the further design and implementation of the newly established Scottish Exchequer and the development of the Scottish National Investment Bank to ensure they develop in line with international good practice on open government. It is proposed that the Scottish National Investment Bank’s operations include an Ethical Statement, and a role for citizen involvement in an Advisory Group. Both of these proposed approaches have the potential and intent to inform thinking around the Bank’s governance and wider accountability as well as improving citizen participation.
- To seek the views of stakeholders and the wider public about how to make Scotland’s public finances more transparent and accessible in order to promote public discussion, debate and participation in financial and policy decision making. This will include learning from young people, primarily through working with YoungScot. The Scottish Government will work with partners and expert civil society actors to review and incorporate good practice on transparency, accountability and citizen engagement into the work of the Scottish Exchequer. This will include a number of round table- events to bring together experts on fiscal transparency to share learning and understanding.
- To build on the work of the first Open Government Partnership Action Plan, in order to improve the effectiveness of budgetary information in communicating with external audiences.”
- The Scottish National Investment Bank adopts Open Government principles and culture and explores: (a) setting up a Citizen Advisory Group; (b) developing an Ethical Statement with public participation and input
- Publish Young people’s understanding of Public Finances Report – with YoungScot
- Publish a Spending Review Framework by June 2019, which will set out the economic and political context, the criteria which will govern the assessment of budgets and the process and timetable for the review.
- Make closer links with outcomes under each successive Scottish Budget (December each year), by (a) providing commentary and analysis on how spending contributes to intermediate outputs, measures, milestones and outcomes; (b) providing a clearer link between policies and plans and the Budget document to show how the allocation of resources contributes to priorities, long-term aims and outcomes.
- Publish more information about Scotland’s progress in relation to the National Performance Framework and Sustainable Development Goals
- Publish Scottish Government procurement-related spend information
- Publish Scottish Government contract documentation, starting with large collaborative frameworks
- Consult with civil society on how best to make published procurement information useful and accessible to a wide audience.
Start Date: December 2018
End Date: December 2020
Editorial Note: The text of the commitments has in some cases been abridged for the sake of brevity. For the full text of this commitment, see: “Scotland’s Open Government Action Plan for 2018-20: Commitments in detail”, pp 2-5.
Context and Objectives
This commitment has four key objectives:
- embedding the principle of openness in the foundation of the Scottish Exchequer and the proposed Scottish National Investment Bank (SNIB);
- seeking the views of stakeholders on how to make Scotland’s public finances more transparent and accessible;
- making closer links between the Scottish budget and performance outcomes and
- improving procurement transparency.
These objectives are highly relevant to the current fiscal environment in Scotland in light of the powers devolved to Scotland through the 2012 and 2016 Scotland Acts which have provided significant additional tax, spending, and borrowing responsibilities for the Scottish Government. This has led to growing public and parliamentary interest in financial transparency and how financial management relates to performance against the National Performance Framework (NPF) and Sustainable Development Goals (SDGs).  At the same time, the creation of the Scottish Exchequer and the Scottish National Investment Bank provides an opportunity to establish these new bodies in a manner which is open and transparent in order to build public trust from the outset. 
This commitment is primarily relevant to the OGP value of access to information as it aims to support the Scottish Government to present that information in a way which more clearly demonstrates the links between spending decisions and performance outcomes. Publishing a wider range of information on procurement processes and spending could also help citizens better understand how the money is used and accounted for and eventually enable them to interpret and manipulate that data for specific purposes related to their local communities or their local needs. Some of the activities are also relevant to the OGP value of civic participation insofar as they provide opportunities for the public to give their input on the ways in which information is presented (e.g. deliberative workshops with young people, consulting with civil society on making procurement information useful and accessible).
The IRM researcher considers this commitment to be specific enough to be verifiable, although not in its entirety. Some of the activities under the commitment are concrete, such as the plan to set up a Citizen Advisory Group and develop an Ethical Statement for the SNIB, to publish a Young People’s Understanding of Public Finances Report or to publish a Spending Review Framework. In other cases, specific information is provided but not under the activities themselves, which hinders clarity. For example, the plan to work with young people in deliberative workshops is mentioned in the full commitment narrative but not under the activities. The same is true for the plan to hold round table events with the Scottish Exchequer. For other activities, the wording in the plan is too vague to enable independent verification of whether they have been achieved. For example, it is not clear what publishing “more information” about Scotland’s progress in relation to the NPF and SDGs would look like (more as compared to what?). Similarly, the plan for the SNIB to adopt “open government principles and culture”, while an important ambition, is not a concrete activity which can readily be measured. Conversations with those within government responsible for the implementation of these commitments shed more light on the detail of the proposed activities but these are not apparent from the action plan itself.
The IRM researcher considers the potential impact of this commitment to be moderate. It responds to the 2017 IRM Report’s recommendation for the government to continue and deepen its work on financial transparency under any future action plan, with a particular emphasis on proactive publication of a much wider set of government-held information.  The understanding of finance and financial transparency were also clearly identified as priorities during the public consultation events.  At the same time, the government considers the fact that the new Scottish Exchequer and the SNIB have signed up to working in “the spirit and practice” of OGP is highly significant given the traditionally cautious and inward-looking culture among public sector financial institutions.  Lucy McTernan also described the window to influence how these new financial structures and institutions are governed right from the outset as “a once in a generation opportunity”. 
However, the potential impact of the commitment is limited by the lack of specificity of some of the activities. As acknowledged by Scotland’s point of contact for OGP, Doreen Grove, the action plan was not yet able to be as specific as some had wanted to be regarding the work on the SNIB and Scottish Exchequer given the early stage of development of these new institutions.  Indeed, while reference is made to the Scottish Exchequer in the commitment text, none of the activities address the stated objective “to apply open government policies and practice” to its design. Similarly, the plan is not specific about how the government will align the indicators for the NPF and the SDGs and how the Scotland Performs website will accurately reflect the progress in both.
The IRM researcher recommends that work on financial transparency should continue to form an integral part of future action plans. In particular, the work on making the links between financial resources, policies, and outcomes clear and understandable to citizens is critical to support meaningful participation in decision-making as emphasised in other parts of the action plan. More specifically:
- This commitment suffers from a lack of clarity in terms of distinguishing between ambitions, objectives, and concrete activities. While acknowledging the iterative nature of this work, the IRM researcher recommends any future action plan to more clearly differentiate between the objectives of the work on financial transparency and the specific measurable activities to achieve those objectives. This could be achieved, for example, by articulating a clearer set of sequential milestones, indicating who will deliver the activities and by when.
- More immediately, during implementation of the current plan, the OGP Steering Group should consider developing and publishing a more concrete set of milestones and activities under this commitment as they emerge. This would allow for more transparent ongoing monitoring of the process (see related recommendation under Commitment 2 below).
- Related to the above, any future plan should consider focusing on a smaller set of objectives under this commitment. As currently conceived, this commitment contains a broad range of activities which are loosely connected, making it difficult to identify how they contribute to a bigger goal. At the same time, the IRM researcher acknowledges that the broad scope of the commitment is a reflection of the level of ambition and enthusiasm for working on financial transparency and the constraints imposed by the need to restrict the number of commitments to five. (See Section V: General Recommendations).
- Future iterations of the work on procurement transparency could consider putting more focus on building the capacity of different groups, including individual citizens, to make use of the information and data which is released, through for example support for citizen journalism. This also applies to the work on open data more generally under Commitment 3.
- As suggested by participants at the public engagement events, for any future action plan the government could consider producing and publishing gender impact assessments of budget proposals before the budget bill goes to Parliament, as part of the evolving workstream on aligning budgets with outcomes under this commitment. 
Financial and Performance Transparency
SCO0006, 2018, Anti-Corruption
Open Policy Making and Participation in Service Delivery
SCO0007, 2018, Capacity Building
Improve Data Use
SCO0008, 2018, Access to Information
Public Service Accountability
SCO0009, 2018, Legislation & Regulation
Transparency and Participation
SCO0010, 2018, Citizenship & Immigration
SCO0001, 2017, Anti-Corruption
Measuring Scotland’s Progress
SCO0002, 2017, Capacity Building
Deliver a Fairer Scotland
SCO0003, 2017, Local Commitments
Participatory Budgeting (Also Known as Community Choices in Scotland)
SCO0004, 2017, Capacity Building
SCO0005, 2017, Capacity Building