Scottish Government relationships with public bodies: progress review

7 Capacity and Capability

7.1 Many public body interviewees commented on the rate of staff turnover in sponsor teams and even senior sponsor posts, and there was recognition that the demands of Covid response had made this particularly acute in SG in the past 18 months. Interviewees referred to the 'hollowing out' of SG teams as a result of Covid pressures. One interviewee commented that posts in sponsor teams are not seen as 'sexy' and do not attract as many applications, and some teams reported carrying vacancy in key sponsor team roles for many months. The rapid turnover of staff, particularly acute under Covid response, means that relationships need to be re-established regularly, corporate memory is lost and there is a very significant demand for training of staff who are new to the sponsorship function. One interviewee referred to the 'black art' of sponsorship and the importance of experience in addition to guidance and training.

7.2 New online training for sponsor teams has now been launched by the Public Bodies Unit, and training is run regularly for Accountable Officers and Board members. Interviews identified a couple of gaps in current training provision:

• for senior sponsors, particularly for anyone taking up a senior role who has not had experience of sponsorship at a more junior level; and
• for newly appointed Chief Executives of public bodies who don't have a civil service or wider public sector background.

The Public Bodies Unit highlighted that the new online training is aimed at senior sponsors as well as more junior staff so may well fill the first of these gaps as awareness of it increases.

7.3 Interviewees were not specific about what development would be needed for senior sponsors or new Chief Executives in this situation – it may be a combination of formal training about the expectations of the role (although Chief Executives will likely get some of this from Accountable Officer training) but also mentoring or coaching from more experienced colleagues. Chief Executives with no public sector background who find themselves working with sponsor teams report that it can be difficult to understand SG structures and to build relationships beyond the sponsor team, so advice from more experienced colleagues may be very helpful.

7.4 The Public Bodies Unit currently has 5.5 full-time equivalent (FTE) staff – 1 C1, 1 B3, 2.5 B2 and 1 B1. The Public Bodies Unit team objectives for 2021-22 cover, in addition to support for this review:

• the promotion of proportionate, risk-based sponsorship;
• supporting the effectiveness of Chairs, boards and senior office holders;
• ensuring that the Scottish Government has an appropriate place in the accountability chain, and ensuring that proportionate arrangements are in place to safeguard public funds and incentivise performance;
• the promotion of 'Team Scotland' with public body contributions aligned to National outcomes, NPF and Public Service Reform;
• Developing a revised system for supporting the establishment of new public bodies within PBU and at corporate level, and supporting work on potential new public bodies;
• giving timely advice on strategic issues about public bodies as required; and
• providing advice and information, promptly, accurately and helpfully to sponsors & public bodies.

7.5 Those in the Public Bodies Unit are concerned that the demand on the reactive areas of their responsibility – strategic issues, support for creation of new bodies and general advice and information on sponsorship – tends to get in the way of the proactive development work on overall effectiveness, accountability and outcomes, but at the same time they do not feel they are meeting the full demand and that they are not always able to provide the combination of support and challenge on key issues at an early stage that helps avoid bigger problems with public body governance later. There was certainly an appetite amongst sponsor team interviewees for the Public Bodies Unit to play a more prominent role, and to have more capacity for responding to questions and providing support to sponsor teams in dealing with more difficult situations. The Public Bodies Unit itself, and some interviewees, were keen also keen to develop a more active community of people involved in sponsorship work across SG to share expertise and insight, but have found this challenging given other priorities.

7.6 The Public Bodies Unit works with a range of other 'central' teams in SG on the various issues that arise in SG's management of its relationships with public bodies: Financial Management Directorate including the Governance and Risk Team, Digital Directorate, People Directorate including the Public Appointments Team, the Pay and Pensions Fiscal Policy Team, Legal Directorate and Internal Audit are the teams most closely involved. There is good cooperation amongst Public Bodies Unit and these other central teams, but sponsor teams and senior sponsors are not always clear whom they should contact on a public body issue, which creates a further challenge in providing an effective and timely response.

7.7 If it is possible to provide additional staff with the right skills and experience, the Public Bodies Unit could be expanded to form a Public Bodies Hub that would provide a first point of contact on any public body issue, and would have the capacity to discuss issues facing sponsors in detail, provide support and/or make connections with others in SG with relevant professional expertise or experience and ensure that guidance is fully understood. The Hub would support Portfolio Accountable Officers and senior sponsors in promoting a consistent approach based on the guidance and templates provided. It would work with central teams across SG to ensure a coordinated approach to advice on any public body issue. The work which Kathleen Marshall has undertaken on Ministerial appointments is also recommending stronger central capacity to support colleagues and ensure consistency, and it would therefore be worth exploring what structural arrangements would lead to the most effective collaboration between a proposed Public Bodies Hub, additional central capacity on Ministerial appointments and the existing Public Appointments team, in order to provide the best possible support across SG.

7.8 Providing more direct support to sponsor teams could be seen as undermining their responsibility but the experience of implementing Smarter Sponsorship so far suggests that more support with an element of challenge is important if SG is to achieve a consistent approach. Given the level of churn and therefore the relative inexperience of many people currently undertaking sponsorship roles, some additional central capacity is important if senior sponsors and Portfolio Accountable Officers are to be properly supported in their roles. Sponsors would need to have confidence in the quality of the advice and respect for the challenge coming from a Public Bodies Hub, so additional staff would need to have a credible level of experience and a deep understanding of public body governance issues.

7.9 Given pressure on SG resources overall, creation of new posts in any team will be challenging. The minimum additional staffing required in PBU to provide support and challenge to sponsor teams is an additional two members of staff at C Band with significant experience of sponsorship and/or of public body governance. If it is possible to create two new C Band posts, the grading of which would need to be confirmed through the appropriate procedures, that would be the most robust option. For the wider coordination work of the Hub, one or more additional posts at B band would be required, but the number and grade of posts would depend on the precise remit of the Hub, taking into account the other work underway on Ministerial Appointments.

7.10 It is important to recognise that the recommendations in this report cannot be implemented effectively if there is no additional resource available centrally to support, challenge and coordinate action across SG. Rather than thinking of posts as a net addition to current staffing, it may be more helpful to think about how SG is currently using all of the resources devoted to sponsorship work. The group of 200 or so staff across SG identified as currently working fully or partly on sponsorship is a significant investment of time in the current arrangements, which are not fully meeting Portfolio Accountable Officers' needs. It would be possible to consider how sponsorship arrangements can be reorganised to release at least one experienced team leader and one or two B band staff to work in the Hub. There could also be advantages in considering an inward secondment of someone with strong governance experience from a public body as another way of increasing the capacity and capability of a Public Bodies Hub in the short-term and providing an insight into effective sponsorship as seen from the other side.

7.11 In addition to making faster progress with the proactive development work that is already part of the Public Bodies Unit's remit, supporting implementation of the recommendations in this report and providing stronger support and challenge to sponsors, an expanded Public Bodies Hub would be able to prioritise work to develop a network of staff with sponsorship responsibilities. This would help increase overall capability and raise the profile of sponsorship work across SG, which should have significant long-term benefits.

7.12 The staffing of the Public Bodies Hub should be reviewed after the first two years to assess the impact of the additional central capacity and capability. If much of the development work has been completed by that stage and there is an active sponsorship network sharing knowledge and experience, there may be a reduced requirement for staff in this central team – but it will be important to ensure that there is enough capacity to provide support in challenging circumstances and ensure good coordination of the work of all central teams to support public bodies and their sponsors.

Recommendation 14: Identify two experienced team leaders with a good understanding of public body governance issues to take up post in the Public Bodies Unit to provide additional capacity for development, support and challenge, and review what additional staffing would be required to create a Public Bodies Hub to coordinate improvement work on sponsorship and Ministerial appointments and provide a first point of contact to sponsor teams on all public body issues.

7.13 As discussed in the 'Case for Change' section at the start of this report (see paragraph 1.7), ideally SG would go further and create a formal change programme to implement some or all of the recommendations in this report. This would give much greater confidence to Portfolio Accountable Officers that changes will be delivered effectively, but it would require additional staff with the appropriate training to manage the programme and it is likely that will be challenging to achieve given the range of programmes and projects which SG has to resource. Public Body leaders, particularly the Chairs of the NDPB Chief Executives Forum and the Scottish Government Delivery Bodies Group, have indicated that they are willing to become involved to support implementation, which may provide options for governance of the work to improve the way that SG manages its relationships with public bodies even if this stops short of a full change programme.

7.14 Public Bodies Unit currently works closely with central teams to provide support to public bodies and their sponsors, particularly calling on professional legal, HR, IT and finance advice when required. Central teams generally respond very positively when their help is required and interviews demonstrated good cooperation amongst teams, but also highlighted the difficulty of providing ongoing support to public bodies and sponsors when this is required over many weeks or months. It would be possible for the Public Bodies Hub to go further than working with existing central teams in SG to respond to individual queries and situations and to work with them to ensure that there are arrangements in place to bring in help from external people or organisations to deal with issues that require more time and attention than central teams can themselves provide. Digital Directorate and SG Legal Directorate already have arrangements in place which can be used for additional expertise in IT or legal issues, and similar arrangements could perhaps be made for specialists in HR, finance and governance. Any framework arrangement for external help would need to go through appropriate procurement procedures, led by the Public Bodies Hub but involving members of central teams with relevant expertise in setting requirements and carrying out the evaluation.

E Ryan

15 November 2021