The Crerar Review: the report of the independent review of regulation, audit, inspection and complaints handling of public services in Scotland

07 CONCLUSIONS FROM THE ANALYSIS OF EVIDENCE

7.1 This chapter presents the key conclusions from the preceding chapters before we go on to present our proposals for the future use of external scrutiny in chapter nine. Our analysis focuses on strategic issues rather than the operations of individual scrutiny regimes, and we highlight systems level issues about application, focus, direction, leadership and control of external scrutiny of public services in Scotland.

7.2 We have suggested that the unique role of external scrutiny is to provide independent assurance that services are well-managed, safe and fit for purpose and that public money is being used properly. This is an essential function of the system of governance and accountability for public services that will always be required.

7.3 We argue throughout the report that primary responsibility for improving services lies with the organisations that provide them, but we recognise that external scrutiny can also be a catalyst for improvement where it influences behaviour and culture of providers, leading to improvements in the way that services are delivered. We have concluded that five principles should govern the application and use of external scrutiny - public focus; independence; proportionality; transparency; and accountability. These principles are well understood and have already been adopted in some form by most scrutiny bodies. We noted a particular issue about the independence of scrutiny in health.

7.4 We have found that there has not always been clarity of role and purpose or principle in the way that external scrutiny has been introduced in recent years. Existing external scrutiny arrangements have evolved to serve government intentions at particular points in time. Growth in scrutiny reflects circumstances where the governments at the European, UK and Scottish levels have felt the need to increase the indirect supervision of public service delivery through increased inspection, audit and regulation. This is partly because of lack of confidence in service delivery, absence of robust performance management in many services, and partly because of new policy priorities. The Scottish Government's intentions are changing, and it is now seeking to devolve more responsibility for managing and monitoring services to front-line providers and to streamline reporting processes. These developments have contributed to the debate about the role and future use of external scrutiny.

7.5 The growth in scrutiny has been accompanied by a growth in scrutiny costs. Providers believe that this has had a significant impact and is diverting resources from front-line delivery. This was particularly evident in local government. However it is difficult to assess costs across different scrutiny regimes, to assess compliance costs accurately, and to judge whether the "right" amount of resource is being allocated to scrutiny activity. There is a similar difficulty in assessing the impact of external scrutiny on performance by service providers. There is therefore a need for further work to enable a more accurate assessment of costs and benefits.

7.6 Scrutiny arrangements are complex. This is partly a reflection of the public service delivery landscape. Each external scrutiny regime performs the role they have been asked to perform by the Scottish Government and by the Parliament in auditing, regulating or inspecting public services. We do not question the integrity of individual regimes and organisations, but we do believe that it is necessary now to re-consider the overall aims and desired effect of external scrutiny, with a view to ensuring it is proportionate and minimises workload for providers. Allied to this objective is a need for a realistic assessment about the extent to which external scrutiny is an appropriate response to risks in public service delivery.

7.7 Complexity also arises from the way that scrutiny bodies carry out their business and the way they are set up and run. The result of this is a wide variety of scrutiny methodologies, organisational structures and governance arrangements, and a large number of different players with the ability and right to both direct and create new scrutiny. Such complexity makes joint working on cross-cutting and complex issues more difficult to organise effectively. We believe there is scope to build more consistent leadership and control to ensure more strategic and flexible use of scrutiny resources.

7.8 The creation of the Scottish Parliament has changed the accountability landscape. We suggest that there is a need for a revised model of accountability where independence from the Scottish Government is balanced by responsibility to Parliament. There is scope to strengthen democratic scrutiny through further refinement of the Parliament's role in the scrutiny process, and for Parliament to be more proactive in seeking assurance. This would involve placing a stronger duty on scrutiny bodies to account to the Parliament for their activities and use of resources.

7.9 Given the importance of the public as beneficiaries of external scrutiny, it is important that scrutiny contributes to wider policy intentions to focus services more effectively on their needs. We have found that whilst most scrutiny regimes are working towards this focus, there is scope to go further and to involve the public more effectively, and to improve transparency, measurement and reporting. This will require scrutiny bodies to work in conjunction with other stakeholders to develop better ways to measure and evaluate provider performance, and will require more involvement of service users and the public in the process. However, this will not be easy. It has to be done in a way that is proportionate. There are cost implications to doing it thoroughly and, as a number of stakeholders have highlighted, resources may need to be diverted to achieve this aim.

7.10 The system for future external scrutiny that we propose in the following chapters addresses the issues summarised here.