Review of Holyrood's budget process: interim report identifies key themes

10.03.2017

An interim report considering what changes may be required to Holyrood's budget process as a result of the further devolution of financial powers has been published An interim report considering what changes may be required to Holyrood's budget process as a result of the further devolution of financial powers has been published today.

Five key themes have been identified by the ‘tri-partite’ budget review working group at the interim stage - central to which is the question: how effective is the existing budget process? 

The report encourages outside organisations and individuals to contribute views to the next phase of the review in order to influence Scotland’s future budget process.

Billed at the outset as a “fundamental review” of the budget process, the five key themes to be addressed in the next phase of the review are:

  • How effective is the existing budget process?
  • What is the impact of the fiscal framework?
  • How effective is the current approach to Multi-Year Budgeting?
  • How effective is the current approach to Medium Term Financial Planning?
  • How effective is the current approach to outcomes based scrutiny?

Established in September 2016, the 'tri-partite' working group - comprising Scottish Parliament officials, Scottish Government officials and external public finance experts - was tasked with developing proposals for a revised parliamentary budget process to take account of Scotland's new fiscal powers.

Commenting on the interim report, review group member Dame Sue Bruce said:

“The main impetus for the review is the need to accommodate the Scottish Parliament’s new financial powers as well as the operation of the Fiscal Framework within Scotland’s budget process. 

“The new process also needs to take account of a budget which simultaneously raises and allocates revenue, which is new territory for Holyrood.

“In the first phase of the review, the group sought to learn from international principles for budget scrutiny, including those developed by the OECD and International Monetary Fund. 

“Ultimately, our aim is to produce a principles-based, world-class budget scrutiny process.”  

Fellow review group member Professor James Mitchell, Director of Academy of Government, University of Edinburgh said:

“If we are to develop a world class financial scrutiny process, we will need a transformational change that addresses the range and complexity of issues now bound up in Scotland’s budget process.

“It will require the Scottish Government and the Scottish Parliament to work together closely and with other bodies such as Audit Scotland. 

“Importantly, however, civic Scotland must also contribute its wisdom to the review process.  This consultation on our interim report is intended as a starting point for these discussions.” 

The group would welcome a response to the consultation questions within the interim report - the deadline for submissions is Friday 28 April. 

The Review Group will report to the Parliament’s Finance and Constitution Committee and Ministers before summer recess 2017.

Background information

The interim report of the Tri-Partite Scottish Parliament Budget Process Review Group can be found here: http://www.parliament.scot/parliamentarybusiness/CurrentCommittees/100930.aspx 

The Group consists of a range of external experts, Scottish Parliament and Scottish Government officials.  The membership of the external group of experts is as follows:

  • Caroline Gardner, Auditor General for Scotland
  • Don Peebles, Head of CIPFA Scotland
  • Sean Neill, Chief Executive, Scottish Fiscal Commission
  • Professor James Mitchell, Director of Academy of Government, University of Edinburgh
  • Dame Sue Bruce, Consultant
  • Dr Angela O’Hagan, Glasgow Caledonian and Gender Budgeting expert
  • Elaine Lorimer, Chief Executive of Revenue Scotland
  • Professor Mike Danson, Heriot-Watt University