Scottish Spending Review 2011 and Draft Budget 2012-13

Chapter 14 Administration and Parliamentary Business and Government Strategy

PORTFOLIO RESPONSIBILITIES: THE ADMINISTRATION BUDGET

The Administration budget covers the costs of running the core administration required to support the Scottish Government's Purpose and Strategic Objectives. These costs comprise primarily staffing, but also accommodation, information technology, travel and training. The budget contributes to the achievement of all the Strategic Objectives across each of the Ministerial portfolios and to the delivery of our 15 National Outcomes.

OUR ACHIEVEMENTS

We have consistently exceeded our Efficient Government targets over the period since 2007. Specific achievements relating to the Administration budget and the management of the costs of Government operations include:

• a reduction in Scottish Government core staff numbers of 10 per cent in the course of 2010-11, delivering a more efficient service to Ministers;
• significant progress towards cutting the costs of the Senior Civil Service, delivering an estimated saving of 13 per cent by the end of 2011-12, and we will deliver a reduction of at least 25 per cent by 2014-15;
• a reduction of a further 20 per cent (around £1 million) in travel expenditure in 2010-11 compared to 2009-10, freeing resources for front-line services (building on a saving of 20 per cent in 2009-10 compared to 2008-09);
• consistently achieving our 10-day target for paying bills to businesses in Scotland who supply the Scottish Government. We paid over 98 per cent of invoices within 10 days in 2010-11, helping to support firms' cash flow and economic recovery;
• continuing to make more information on Scottish Government activity widely available. In addition to publishing online details of all items of Government expenditure over £25,000 we will soon make available additional information highlighting our annual spend on areas including public relations, consultancy, hospitality and entertainment as part of our commitment to public service reform. We also now routinely publish salary and cost information about our Directorate structure and details of any gifts and hospitality received by Strategic Board members; and
• savings on printing costs (around 20 per cent of expenditure) as a result of the central government sector collaborative competition to put in place a framework agreement for design, print, publicity and associated services.

DELIVERING FOR SCOTLAND

We will also continue to ensure the Scottish Government is an efficient, effective and networked organisation, focused on improved outcomes. We have adopted a business strategy to guide the development of our organisation and its working practices, focusing on four key imperatives: supporting the making of choices for Scotland, ensuring effective delivery, promoting creativity and supporting and developing our staff in line with our values. We will continue to deliver the Government's Purpose, support Ministers in their work, and ensure the proper stewardship of public money. The Business Strategy and its four key imperatives provide a framework for the Administration budget.

MANAGING PRESSURES AND CUTS IN PUBLIC EXPENDITURE

We recognise that, in asking others to reduce their expenditure, we must take a lead in reining back our own spending so that more can be spent on boosting the economy and frontline services. The total expenditure on Administration in the period from 2012-13 to 2014-15 will decrease from £236 million per annum to £193 million. This is a reduction of £43 million over three years. To achieve this significant reduction, we will:

• put in place a rolling voluntary early severance programme to reduce staff numbers;
• continue with our plan to cut the costs of the Senior Civil Service by at least 25 per cent by 2014-15 (with 2010-11 as the base year);
• re-prioritise tasks to ensure alignment with key Ministerial priorities over the forthcoming Spending Review period and to stop activities that contribute less to these priorities;
• maintain firm downward pressure on pay rates, in accordance with Ministerial pay policy, with a pay freeze extended into 2012-13 for all staff earning over £21,000 and further extension of the pay freeze for Senior Civil Service staff from 2010-11 for a third year; and
• continue to engage with staff and their representatives to discuss how best to manage the budget and headcount reductions required.

We will continue to re-shape and refine our organisational structure to maximise the effective delivery of policies highlighted in this Spending Review, and we will work to deliver savings and greater efficiency across all portfolios. The Administration portfolio's priorities are:

• setting up the capability and mechanisms to drive forward on the constitutional agenda and the implementation of new powers for Scotland;
• building a central capacity and testing models for the flexible deployment of our resources;
• continuing to review our business processes; including risk management, attendance and wellbeing, Ministerial correspondence and Freedom of Information;
• to ensure that we continue to show we are an exemplar in diversity and equality. The Scottish Government's equality and diversity initiatives will play a key role in supporting the delivery of all National Outcomes. Our overall approach focuses on these key themes: behaviour and culture change; leadership and accountability; talent management; and representation and capability;
• to ensure that the organisation offers maximum value for public money. This includes releasing resources through the delivery of efficiency savings and through re-prioritising tasks to reduce spending on Administration by over £21 million in 2012-13 compared to 2011-12, followed by further reductions of £12 million and £9 million in the years 2013-14 and 2014-15. This follows a reduction of £26 million in 2011-12 compared with 2010-11;
• to ensure that the percentage of total expenditure devoted to Administration costs, across the core Scottish Government and its agencies, remains at least 25 per cent below the comparable percentage for the UK Government; and
• to implement a range of both behavioural and technical measures to deliver a reduction in carbon emissions across the Scottish Government. Technical measures introduced to date include the ongoing upgrade to the building controls and management systems infrastructure across the estate to enable monitoring of energy profiles to facilitate targeted reductions through optimisation of building lighting, heating, ventilation and cooling systems. The network of environmental performance advisers throughout the estate plays a key role in influencing colleagues to consider their ways of working and to move to more sustainable practices. More information about the measures to be implemented is set out in the Scottish Government Carbon Management Plan 2009, and a revision for 2011 is due to be published before the end of the year.

Spending plans for 2012-15 are set out below.

Table 14.01: Detailed Spending plans (Level 3)

	2011-12 Budget £m	2012-13 Draft Budget £m	2013-14 Plans £m	2014-15 Plans £m
Scottish Government Staff	152.0	139.9	132.9	126.3
Accommodation	17.8	15.1	14.3	13.6
Other Office Overheads 1	38.6	32.8	31.2	29.6
Training	4.9	4.2	4.0	3.8
Office of the Queen's Printer for Scotland	0.1	0.1	0.1	0.1
Capital Charges	15.1	15.1	15.1	15.1
Capital ICT Projects	5.5	5.5	3.7	3.7
Other Capital Expenditure	2.0	2.0	1.3	1.3
Total 2	236.0	214.7	202.6	193.5
of which:
DEL Resource	228.5	207.2	197.6	188.5
DEL Capital	7.5	7.5	5.0	5.0
AME	-	-	-	-

1. Includes ICT projects and minor non-pay items e.g. travel, transport, stationery, hospitality, etc.
2. The breakdown of spending plans for 2012-13 is subject to change as we seek to reduce overhead costs in favour of minimising the reduction necessary in the number of staff available for deployment to support existing and new priority activities.

Table 14.02: Detailed Spending plans (Level 3 real terms) at 2011-12 prices

	2011-12 Budget £m	2012-13 Draft Budget £m	2013-14 Plans £m	2014-15 Plans £m
Scottish Government Staff	152.0	136.4	126.3	116.8
Accommodation	17.8	14.7	13.6	12.6
Other Office Overheads	38.6	32.0	29.6	27.4
Training	4.9	4.1	3.8	3.5
Office of the Queen's Printer for Scotland	0.1	0.1	0.1	0.1
Capital Charges	15.1	14.7	14.3	14.0
Capital ICT Projects	5.5	5.4	3.5	3.4
Other Capital Expenditure	2.0	2.0	1.2	1.2
Total	236.0	209.4	192.4	179.0
of which:
DEL Resource	228.5	202.1	187.7	174.4
DEL Capital	7.5	7.3	4.7	4.6
AME	-	-	-	-

Portfolio Responsibilities: parliamentary business and government strategy budget

The Parliamentary Business and Government Strategy budget supports a range of central analytical services and strategic communications activity. This portfolio supports the alignment of all public sector activity towards the delivery of the Government's Purpose and, in particular, help create a strong evidence base and increase understanding of the key strategic, economic and social challenges across the Scottish Government.

National Outcomes

This portfolio includes key analytical activity which supports all of our 15 National Outcomes, and allows Ministers to communicate and engage with people in the delivery of these Outcomes.

Managing Pressures and Cuts in Public Expenditure

In light of the tight fiscal environment, this portfolio will reduce its budget by 20.7 per cent in 2012-13, and by a total of 26.8 per cent by 2014-15. This will be achieved through efficiencies and careful prioritising of work, to ensure that the key outputs are maintained as pressure on budgets increases.

Summary of Key Spending Priorities

In 2012-13 we will:

• continue to support the delivery of our National Outcomes, and support our local delivery partners through the provision of high quality local data; and
• drive down the costs of providing these services, through efficiencies and by improvements in the way we work.

Table 14.03: More Detailed Spending Plans (Level 3)

Level 3	2011-12 Budget £m	2012-13 Draft Budget £m	2013-14 Plans £m	2014-15 Plans £m
Strategic Communications	4.3	3.1	2.9	2.7
Crown Office and Procurator Fiscal Service Inspectorate	0.3	0.3	0.3	0.3
Royal and Constitution	0.3	0.3	0.3	0.3
Office of the Chief Statistician	1.6	1.5	1.5	1.4
Strategic Research and Analysis Fund	1.0	0.9	0.9	0.9
Office of the Chief Economic Adviser	0.7	0.4	0.4	0.4
Total Level 2	8.2	6.5	6.3	6.0
of which:
DEL Resource	8.2	6.5	6.3	6.0
DEL Capital	-	-	-	-
AME	-	-	-	-

Table 14.04: Detailed Spending Plans (Level 3 real terms) at 2011-12 prices

Level 3	2011-12 Budget £m	2012-13 Draft Budget £m	2013-14 Plans £m	2014-15 Plans £m
Strategic Communications	4.3	3.0	2.8	2.5
Crown Office and Procurator Fiscal Service Inspectorate	0.3	0.3	0.3	0.3
Royal and Constitution	0.3	0.3	0.3	0.3
Office of the Chief Statistician	1.6	1.4	1.3	1.2
Strategic Research and Analysis Fund	1.0	0.9	0.9	0.8
Office of the Chief Economic Adviser	0.7	0.4	0.4	0.4
Total Level 2	8.2	6.3	6.0	5.5
of which:
DEL Resource	8.2	6.3	6.0	5.5
DEL Capital	-	-	-	-
AME	-	-	-	-

What the budget does

The central analytical budgets, which include the Offices of the Chief Statistician and the Strategic Research and Analysis Fund, provide data and related analysis to support the evidence base on delivery and increasing our understanding of key strategic, economic and social challenges across Scotland.

The Office of the Chief Economist programme budget is used for procurement of data and various pieces of economic analysis to strengthen understanding of key issues around the economy and provide advice/support to the First Minister and Cabinet Secretary for Finance, Employment and Sustainable Growth.

The Strategic Communications budget allows Scottish Ministers to communicate to various audiences. Activity includes research and evaluation and calls to action.

The Crown Office and Procurator Fiscal Service Inspectorate (COPFSI) reports and is answerable to the Lord Advocate, and produces a number of office, area and thematic inspection reports.