Scottish Government Consolidated Accounts 2015 to 2016
Annual report of consolidated financial results of the Scottish Government, its executive agencies and the Crown Office, prepared in accordance with IFRS.
Analysis of Major Variances in the Portfolio Outturn Statements
| Outturn | Budget | Variance | |
|---|---|---|---|
| £m | £m | £m | |
| Resource | |||
| Departmental Expenditure Limit | 28,503 | 28,891 | (388) |
| Annually Managed Expenditure | 2,729 | 2,697 | 32 |
| Outside DEL | 167 | 168 | (1) |
| Capital | |||
| Departmental Expenditure Limit | 1,263 | 1,275 | (12) |
| Annually Managed Expenditure | 459 | 476 | (17) |
| Outside DEL | 187 | 193 | (6) |
| NLF Loan Repayments (no budget) | (14) | - | (14) |
| 33,294 | 33,700 | (406) | |
Explanation of Major Variances greater than £3m within Portfolios
The Scottish Government has been aligned around the 5 Strategic Objectives that underpin the Purpose and describe a Scotland that is Wealthier and Fairer, Smarter, Healthier, Safer and Stronger and Greener. In order to monitor the progress in these key areas, the Scottish Government was set up in a portfolio structure. Performance by the chief operating decision maker is assessed by portfolio, not by strategic objectives.
|
|
Variance |
|---|---|
| Finance, Constitution and Economy |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Digital Public Services, Committees, Commissions and Other Expenditure This managed position reflects timing differences between the agreed implementation schedule for superfast broadband and receipt of funding from programme stakeholders (including UK government). |
|
| Total Overspend |
13 |
| Enterprise, Energy and Tourism: Lower than anticipated take-up in demand-led Energy Efficiency and Renewable Energy grant schemes led to underspends of £43.2m of which £8.5m was used to support Renewable Energy Investment Fund ( REIF); additional expenditure on Tourism major events (Solheim Cup & European Sports Championships) of £2.8m and planned underspends from Enterprise Bodies of £11.1m. Other minor underspends of £1m were identified across a range of programmes. |
|
| Total Underspend |
(44) |
| Parliamentary Business and Government Strategy: Phasing of costs relating to Scottish Parliamentary Elections in May 2016 resulted in an £11m reduction in expenditure. Revised modelling during the year by HMRC on the costs of Scotland Act Implementation resulted in a £16m saving to the Scottish Government. |
|
| Total Underspend |
(27) |
| Other minor variances across the portfolio. |
(1) |
| Total Resource |
(59) |
| Capital |
|
| Lower than anticipated take-up in demand-led Energy Efficiency and Renewable Energy grant schemes led to underspends of £10m. Further £7m underspend within SPPA due to savings as a result of the tendering process on Project 2017 (new payroll and pension administration system). |
(17) |
| Total Finance, Constitution and Economy Underspend |
(76) |
| Health, Wellbeing and Sport |
|
| Resource Departmental Expenditure Limits ( RDEL) Year-end resource DEL position comprises a planned underspend of £5m offset by an agreed additional £2m costs on non-cash DEL. The £5m underspend represents agreed efficiency savings on health programmes in 2015-16 and relates to small underspends across the Portfolio. The £2m relates to additional non-cash costs which were identified with Boards in the financial year. These costs were met within the overall SG non-cash budget. |
|
| Total Underspend |
(3) |
| Annually Managed Expenditure ( AME) |
|
| Minor variances across the portfolio. |
(1) |
| Outwith Departmental Expenditure Limits ( ODEL) |
|
| Minor variances across the portfolio. |
(1) |
| Total Resource |
(5) |
| Capital |
|
| The £127m cap ital DEL overspend comprises a £5m underspend offset by NPD spend of £132m as a result of ESA 10 changes. NPD projects funded in the year relate to NHS Dumfries and Galloway (Dumfries and Galloway Royal Infirmary), NHS Lothian (The Royal Sick Kids Hospital) and NHS National Services Scotland ( SNBTS National Centre). The small underspend on conventional capital was agreed with DG Finance and represents efficiency savings on health programmes in 2015-16. THE ODEL underspend is caused by two hub projects - NHS Greater Glasgow and Clyde's Inverclyde Continuing Care Project and NHS Lothian's Partnership Centre Bundle, both reaching financial close later than expected. |
121 |
| Total Health, Wellbeing and Sport Overspend |
116 |
| Education and Lifelong Learning |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Learning: £19.4m underspend relates to Schools' Estate due to agreed reprofiling of spend into next financial year. £10.5m underspend relates to slower than anticipated take up of the Innovation Fund and related Attainment programmes and budget reprofiling within Technologies for Learning. Funding has been carried forward into the next financial year to ensure full spend on the Attainment Fund. £0.1m other minor underspends within Learning. |
|
| Total Underspend |
(30) |
| Children and Families: £4.9m underspend within Early Years due to a range of factors including slower than anticipated requirement by Local Authorities for Free School Meals, associated costs with reprofiled Attainment programmes in Learning and costs being met by other funds. £4.0m underspend relating to Kinship Care Allowances where initial implementation took longer than anticipated. £2.9m underspend within Disclosure Scotland on staff costs, Force enquiries, transformation programme and also income being higher than anticipated. £1.2m of other minor underspends within Children & Families. |
|
| Total Underspend |
(13) |
| Higher Education Student Support: £82m underspend relates to lower than anticipated write down of the carrying value of the Income Contingent Repayment Student Loan book. This is a technical accounting adjustment, where the budgetary impact is against a specific ring-fenced non-cash element of Scottish Government DEL budget which could not have been spent elsewhere. Further £5m underspend is due to less than anticipated uptake on demand led budgets. |
|
| Total Underspend |
(87) |
| Scottish Further and Higher Education Funding Council: Without reducing the spending power of the Higher Education sector and merely reflecting the correction of historical timing differences between financial and academic year-ends, £50m of Scottish Funding Council cash reserves were released. This led to a lower than anticipated in-year cash drawdown. This was off-set by £4m overspend relating to timing differences in receipt of European Structural Funds Income. |
|
| Total Underspend |
(46) |
| Other minor variances across the portfolio. |
(1) |
| Annually Managed Expenditure ( AME) |
|
| Minor variances across the portfolio. |
(1) |
| Total Resource |
(178) |
| Capital |
|
| £15m underspend as a result of Student Loan advances being lower than expected. Financial Transactions underspend of £3.7m re agreed preprofiling within schools estate programme and £0.7m other minor overspends within Learning. |
(18) |
| Total Education and Lifelong Learning Underspend |
(196) |
| Fair Work, Skills and Training |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Minor variances across the portfolio. |
(2) |
| Total Fair Work, Skills and Training Underspend |
(2) |
| Justice |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Police Central Government: The variance relates to the Scottish Crime Campus, consisting of lower than budgeted depreciation costs and greater than budgeted rental income. |
|
| Total Underspend |
(3) |
| Police and Fire Pensions: The police and fire pensions budgets continue to be under demand-led pressure. The variance relates to higher than anticipated pension payments this financial year. It is a result of increased take up of lump sums and amounts due to changes in Government Actuarial Department commutation rates and larger than expected numbers of retirements. |
|
| Total Overspend |
16 |
| Scottish Prison Service: Variance due to costs associated with the sale of land at HMP Edinburgh not materialising and a range of smaller underspends in pay and running costs including the impact of minimised discretionary expenditure. |
|
| Total Underspend |
(5) |
| Miscellaneous The variance arises as a result of the full Criminal Justice Survey not running during this financial year and reduced research activity (£1.27m), timing of charges regarding Emergency Responder Telecommunications (£0.8m), an underspend arising on the Parole Unit along with other minor underspends. |
|
| Total Underspend |
(3) |
| Other minor variances across the portfolio. |
(1) |
| Annually Managed Expenditure ( AME) |
|
| Scottish Prison Service: |
|
| Budgeted increases in the value of prison buildings were lower than anticipated due to fluctuations in the indices used for valuation purposes. |
6 |
| Other minor variances across the portfolio. |
(1) |
| Total Resource |
9 |
| Capital |
|
| Underspend due to the ministerial announcement cancelling plans for a female prison in Inverclyde resulting in a saving of £30m with further £4m as a result of delay in the acquisition of a site for HMP Highland. |
(34) |
| Total Justice Underspend |
(25) |
| Social Justice, Communities and Pensioners' Rights |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Local Government: The £4m additional expenditure relates to four applications for assistance under the Bellwin Scheme. The Bellwin Scheme allows Scottish Ministers to make additional revenue support to local authorities who would otherwise be faced with an undue financial burden as a result of providing relief, and carrying out immediate work, due to large-scale emergencies. The Deputy First Minister approved the triggering of the Bellwin Scheme following a number of storms at the end of 2015 and the beginning of 2016. |
|
| Total Overspend |
4 |
| Third Sector: The £3m underspend reflects re-profiling of part of the Third Sector budget to support third sector equality projects, the timing of European Social Fund new programmes, and work which was in development. |
|
| Total Underspend |
(3) |
| Housing and Regeneration: There are underspends of £10m due to additional receipts, £34m following reduced demand in the core affordable housing budget, £4m of JESSICA income from European Regional Development Fund ( ERDF) to match fund investments made during the year and £1m other minor variances. A further £14m planned underspend was used to manage expenditure priorities. |
|
| Total Underspend |
(63) |
| Other minor variances across the portfolio. |
(1) |
| Annually Managed Expenditure ( AME) |
|
| Housing Fair Value: Fair value adjustments for Housing Shared Equity due to movement in the House Price Index and fair value adjustments on other investments, including charitable bonds. |
|
| Total Overspend |
16 |
| Financial Guarantee Contract Provision: £4m held against calls on Guarantees of loans issued under the National Housing Trust scheme not required. |
|
| Total Underspend |
(4) |
| Other minor variances across the portfolio. |
(1) |
| Total Resource |
(52) |
| Capital |
|
| Underspends include £44m due to the unpredictability of housing demand led schemes, £17m due to delays in some housing projects between financial years, £16m due to no suitable projects being identified in year, £12m on demand led energy efficiency schemes, £10m for JESSICA regeneration fund due to delays in developer progress. £4m financial transaction overspend on JESSICA regeneration offset by income from European Regional Development Fund ( ERDF). A further underspend of £15m due to significant increase in receipts from shared equity sales and £1m in minor underspends. |
(111) |
| Total Social Justice, Communities and Pensioners' Rights Underspend |
(163) |
| Rural Affairs, Food and the Environment |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Research, Analysis and Other Services: Planned underspend used to manage expenditure priorities. |
|
| Total Underspend |
(5) |
| Marine and Fisheries: Planned underspend of £4m on Fisheries used to manage other priorities and £2m in relation to donated asset which nets off against capital expenditure overspend. |
|
| Total Underspend |
(6) |
| Environmental and Rural Services: Underspend on Private Water schemes of £2m due to fluctuating demand. Planned underspend of £6m on Zero Waste and £1m on Natural Assets & Flooding used to manage expenditure priorities. £2m lower than anticipated cash drawdown for Scottish Environmental Protection Agency. |
|
| Total Underspend |
(11) |
| Climate Change: £2m underspend due to demand led nature of the Land Managers Renewables Fund and £1m of planned underspend to manage other expenditure priorities. |
|
| Total Underspend |
(3) |
| Other minor variances across the portfolio. |
(2) |
| Annually Managed Expenditure ( AME) |
|
| Minor variances across the portfolio. |
(4) |
| Total Resource |
(31) |
| Capital |
|
| £54m of loans in respect of Less Favoured Area Support Scheme ( LFASS) payment delays resulted in a net overspend of £46m on financial transactions. Overspend of £3m in relation to Marine Scotland asset. Underspend of £5m relating to rephasing of the Futures Project to support CAP reform and £2m from sale of Research asset. |
42 |
| Total Rural Affairs, Food and the Environment Overspend |
11 |
| Culture, Europe and External Affairs |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Culture: Underspend of £11m relates to release of cash reserves at Creative Scotland leading to lower than anticipated in-year cash drawdown. This did not impact on Creative Scotland's in-year expenditure plans. Additional underspend of £2m relates to a number of minor portfolio savings made as a result of in-year reprioritisation of spending plans. |
|
| Total Underspend |
(13) |
| Historic Environment Scotland: Underspend relates to expenditure timing differences leading to lower than anticipated in-year cash drawdown. |
|
| Total Underspend |
(4) |
| Minor variances across the portfolio. |
(1) |
| Total Resource |
(18) |
| Capital |
|
| Minor variances across the portfolio. |
1 |
| Total Culture, Europe and External Affairs Underspend |
(17) |
| Infrastructure, Investment and Cities |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Rail Services: A range of underspends and savings including accrued income on Borders Railway planning gain (£18m), lower than anticipated expenditure on Rail Contracts due to reduced level of Retail Price Index adjustments (£15m), release of provisions no longer required (£4m), reprofiling of High Speed Rail expenditure (£4m), reduction of work undertaken on Rail Development (£2m) and savings on several minor Rail Projects (£2m). |
|
| Total Underspend |
(45) |
| Concessionary Fares and Bus Services: Underspend due to the demand being lower than anticipated together with a reduction in the reimbursement rate by 1%. |
|
| Total Underspend |
(9) |
| Motorways and Trunk Roads £11m of expenditure reclassified from capital to resource, £6m of Forth Estuary Transport Authority additional pension deficit settlement and £4m of additional expenditure on Forth Road Bridge remedial work partially offset by underspend on road depreciation of £17m. |
|
| Total Overspend |
4 |
| Ferry Services: £8m of increased Ferry Services contract costs, £7m of additional expenditure on Calmac transformation projects and £5m of further spend on Clyde and Hebrides Ferry Services and Argyll Ferries partially offset by £6m in fuel savings. |
|
| Total Overspend |
14 |
| Air Services: Additional expenditure of £3m on Sumburgh terminal maintenance and £2m on Sumburgh runway remediation. |
|
| Total Overspend |
5 |
| Scottish Futures Fund: Reprofiling of Freight Facilities Grant and Green Bus Fund expenditure. |
|
| Total Underspend |
(6) |
| Other Expenditure: Classification change for Scottish Futures Trust expenditure resulted in an underspend of £4.6m. Other minor overspends of £1.6m were identified across a range of programmes. |
|
| Total Underspend |
(3) |
| Other minor variances across the portfolio. |
1 |
| Annually Managed Expenditure ( AME) |
|
| ESF/ ERDF Fair Value Adjustments: Fair value adjustments in relation to foreign exchange rate movements. |
|
| Total Overspend |
14 |
| ESF Provisions: Provisions made for self correction and for insufficient eligible expenditure. |
|
| Total Overspend |
14 |
| Other minor variances across the portfolio. |
(2) |
| Total Resource |
(13) |
| Capital |
|
| Transport Scotland additional expenditure of £141m as a result of ESA 10 changes in relation to Aberdeen Western Peripheral Road NPD project. This was offset by Forth Road Bridge savings (£52m), reprofiling of expenditure on road schemes (£15m), reclassification of maintenance expenditure (£11m), savings on low carbon vehicle loans (£2m) and release of land provision (£2m). Reduction in voted loans to Scottish Water of £80m. Scottish Futures Trust expenditure reclassification of £5m. |
(18) |
| Total Infrastructure, Investment and Cities Underspend |
(31) |
| Crown Office and Procurator Fiscal Service |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Minor variances across the portfolio. |
1 |
| Annually Managed Expenditure ( AME) |
|
| Minor variances across the portfolio. |
(1) |
| Total Crown Office and Procurator Fiscal Service variance |
- |
| Administration |
|
| Resource Departmental Expenditure Limits ( RDEL) |
|
| Administration Expenditure - Depreciation: The depreciation on the value of the Scottish Government's assets was less than forecast. This was partly due to a review of IT assets to reflect their current economic benefit to the Scottish Government. This non-cash budget, which is subject to separate controls, is not available to fund discretionary spending in the Administration Budget e.g. staff costs, goods and services. |
|
| Total Underspend |
(4) |
| Other minor variances across the portfolio. |
(1) |
| Annually Managed Expenditure ( AME) |
|
| Provisions and Impairments: |
|
| £1m impairment reversal following scheduled revaluation of Victoria Quay, £0.5m reversal of prior year impairment for Saughton House plus £1.3m release of Early Retirement provision. |
(3) |
| Total Resource |
(8) |
| Capital |
|
| Minor variances across the portfolio. |
(1) |
| Total Administration Underspend |
(9) |
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