Finance and Constitution Committee

Meeting date: Wednesday, December 7, 2016

Official Report 475KB pdf

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Draft Budget Scrutiny 2017-18

Agenda item 2 is an evidence-taking session on the Scottish Parliamentary Corporate Body’s proposed 2017-18 budget. I welcome to the meeting Jackson Carlaw MSP, who is a member of the corporate body; Sir Paul Grice, chief executive of the Parliament; and Derek Croll, group head of finance and security. Members will have received copies of a letter from the Presiding Officer providing details of the corporate body’s budget bid, and I invite Jackson Carlaw to make a short opening statement.

Good morning, colleagues. I come before you as a corporate body ingénu, having just assumed responsibility following the resignation of my colleague Alex Johnstone in circumstances that you will all understand. Somewhat to my surprise, I discovered that I was going to have the finance portfolio and would have to appear before the committee about 10 days later to present the corporate body’s budget.

It is delightful to see you.

Thank you for the opportunity to present details of the budget for 2017-18, which is the budget for the second year of the new session of Parliament. You will have seen the Presiding Officer’s letter setting out our budget submission for 2017-18, in which he makes reference to the successful programme of savings that was delivered by the SPCB over the previous parliamentary session. That programme achieved 10 per cent real-terms reductions in budgets and staff numbers from the 2010-11 baseline to 2015-16, while consistently delivering against our strategic plan and supporting demanding programmes of parliamentary business.

The new session brings new challenges, and the corporate body has a duty to ensure that the Parliament is properly resourced to meet its requirements. As a member and colleague since 2007, I certainly detect a renewed energy in the Parliament in this new session. That is partly due to the infectious enthusiasm of so many new MSPs. We had a record 51 new—or nearly new, as we used to say in the motor trade—members elected in May, some of whom are sitting opposite me this morning.

Moreover, I sense that, as we enter session 5, the Parliament has now matured as an institution and continues to evolve, particularly as it assumes substantial new powers on taxation and welfare. We are already seeing evidence of that renewed energy in the volume of business, with significantly increased numbers of questions, motions and proposals for members’ bills, and I can see no reason at this stage to suggest that those increased levels will not be sustained throughout the session.

As for the budget itself, the headline figures for total expenditure excluding non-cash items show an increase of £0.8 million from the 2016-17 budget and are £1.4 million higher than the indicative forecast provided to the previous Finance Committee in December last year. The increase from the previous indicative forecast is due to two specific items that fall outside the SPCB’s control: new statutory functions for the ombudsman; and project costs and system and marketing costs for the new lobbying register. Excluding those, the SPCB’s budget for 2017-18 is in line with its previous submission.

With regard to pay, our budget submission is based on the continuation of our previous prudent pay restraint. The financial year 2017-18 is the second year of a two-year agreement negotiated with the trade unions on pay for SPCB staff, and the budget calculations incorporate the agreed uplift to pay scales in that pay deal. Schedule 3 in our budget submission includes an analysis of additional posts proposed in the parliamentary service and we would be happy to expand on that in our evidence today. As reported to the Finance Committee in previous years, the Scottish Parliament salary scheme now directly links MSP salaries to public sector pay rises in Scotland, using the annual survey of hours and earnings published by the Office for National Statistics. Using that index, I can confirm that an increase of 1.8 per cent will be applied in April 2017.

As we have provided analysis of other costs in various schedules that form part of our budget submission, I do not propose to repeat that information in my opening remarks. However, I draw the committee’s attention to two areas. First, as members are aware, the SPCB is charged with the oversight of commissioners and the Scottish Public Services Ombudsman, and it is an area of our budget that the committee has always taken a keen interest in. The proposed 2017-18 budget for office-holders amounts to £9.6 million, representing a substantial increase of £1.3 million—or 15 per cent—on the approved 2016-17 budget. It is important to recognise, though, that that is largely because new statutory functions have been transferred to the ombudsman in respect of the social welfare fund and social work complaints.

We welcome the involvement of other committees in scrutinising aspects of the various office-holders that are not within our remit. For example, next month the Local Government and Communities Committee and the Health and Sport Committee will take evidence from the ombudsman and the Equalities and Human Rights Committee will take evidence from the Scottish Human Rights Commission.

Secondly, the SPCB is proposing to set aside a £1 million contingency, regarded as prudent, for emergencies, anticipated potential costs that are not yet certain and emerging cost pressures. We consider that contingency to be tight in the current climate of uncertainty, and it is less of a contingency than has been applied previously. We have set that level to maintain the overall budget submission within the previous indicative forecast on a like-for-like basis.

As set out in our submission, the SPCB is submitting its budget to the Finance and Constitution Committee in advance of the publication of the draft Scottish budget on 15 December. It is an unusual situation, but we will consider what that tells us about the pressures on future years’ budgets and respond accordingly. In advance of the Scottish budget, however, we have provided an indicative forecast for 2017-18, based on the latest Office for Budget Responsibility estimate of the consumer price index.

Finally, I put on record the corporate body’s appreciation of the work done by the chief executive and his team in preparing the SPCB’s 2017-18 budget submission. As a new member, I have been struck by the professionalism of the senior staff that serve us in the Parliament.

That concludes my opening remarks. I hope that I have managed to convey a sense of the responsible approach that we have taken to setting the Parliament’s budget. My colleagues and I are more than happy to answer any questions that the committee may have.

Thank you, Mr Carlaw, for those opening remarks. As for the energy of new and nearly new members, I hope that you will accept that some of us veterans still have some fuel left in the tank.

I am willing to be persuaded.

The letter from the Presiding Officer states:

“Our budget bid for 2017-18 reflects the emerging demands arising as a result of the complex new powers”

that the Scottish Parliament will have in the future. Can you say more about how you have dealt with that issue in setting your budget, particularly in the light of some of the work that has been done by John McCormick in the review set by the Presiding Officer? Does some of your contingency money relate to issues that might emerge from that review?

No, I do not think that the contingency makes provision for completely unforeseen issues that might arise from the Presiding Officer’s review, nor does it make any provision for anything arising from the Brexit negotiations. At this stage, those things are too tenuous for us to be able to make any meaningful contingency suggestion. In addition, any costs arising from those matters would probably spread beyond the immediate period ahead and there would be an opportunity for us to reflect them in our next budget submission.

I would reinforce that point by noting that the senior staff group has a board in which we are constantly horizon-scanning constitutional change and feeding down into operational areas. Specifically, we have a sense of where the tax and welfare powers are going, so we have put in a bit of extra strength there. We have not put in any speculative posts. I am confident that the budget that we are proposing for next year has sufficient capacity to cope with the immediate demands, particularly scrutiny of the new fiscal regime and the emerging welfare powers.

You make an important point about the Presiding Officer’s commission. Just to reinforce Jackson Carlaw’s point, I have to say that we just do not know where that is going to take us; instead, what we have done is to put in funding to support the process of the commission. Given that it is due to report next summer, we accept—and this again picks up a point that Mr Carlaw made in his opening remarks with regard to next year’s forecast—-that we will have to revisit the matter. Depending on how radical and substantial the recommendations of that commission are, we will obviously have to reflect that, most likely in next year’s budget and beyond.

Jackson Carlaw referred to the proposed 2017-18 budget for office-holders. As page 3 of the Presiding Officer’s letter points out, the figure is £9.6 million, which is an increase of £1.3 million or 15 per cent on the approved budget for that area. I recognise that a lot of that is dependent on the decisions that Parliament takes and that, in those circumstances, the SPCB needs to reflect what Parliament has decided, but I wonder when we last had a review of commissioners and ombudsmen. What with the pressures that we know are going to come in other areas of the budget, ordinary individuals and members of the public might, when they see that 15 per cent figure, raise their eyebrows. Are there any proposals for a review in the near future?

I will turn to Paul Grice in a second, convener, but I accept your point. I know that there has been a previous review, and Paul will be able to give you details of that. Certainly, the vast majority of the increase that we anticipate in relation to that area relates to the additional responsibilities that it has been determined the ombudsman will carry, but you make an interesting wider point. Paul, can you add anything to that?

We had a review a number of years ago, because a previous corporate body was very interested in a deeper rationalisation of the office-holders. I think that it is fair to say that the reform that occurred fell somewhere between where the SPCB wanted to go and what was felt to be acceptable at the time. For example, it led to the creation of the Commissioner for Ethical Standards in Public Life in Scotland, under whom public appointments and standards were brought together, so there was some movement. Also off the back of that came an on-going piece of work to rationalise accommodation and shared services.

If the Finance and Constitution Committee were interested in encouraging such an approach, I can say that it was certainly the case that the SPCB was very interested in exploring the issue, but it would require wider parliamentary agreement on whether anything further could be done. I am pretty confident that, if that were something that the Finance and Constitution Committee wished us to look at, the SPCB would be more than happy to take that on and perhaps come back to the committee with some further thoughts about.

Good morning. I am interested in the contingency issue. Some people looking at this from outside the Parliament might ask why we should approve a budget that sets aside £1 million as a contingency for dipping into over the course of the year. I know that we have set a contingency in previous years, so can you give some examples of how the provision has been used to reassure us that this is value-for-money budgeting?

First of all, I would say that there has been a greater reliance on providing for a contingency in the budget in previous years. To my mind, this year’s figure represents something less of a contingency than we have perhaps previously provided. Looking at it, and at the challenges that are coming forward, I will say that, although the SPCB has sought at all times to bring forward a prudent and cautious budget, providing less of a contingency is beginning to present its own challenges. In the future, we will have to be mindful that the headroom provided by the contingency each year is beginning to shrink, and I am not sure whether, in the long run, it will be adequate.

Obviously the contingency fund is used for a whole range of areas, and Derek Croll might be able to give examples of its previous use.

In the current year, it has been used for such activities as the Presiding Officer’s commission on parliamentary reform, which came forward in the current year and was not envisaged in last year’s budget submission.

We have also used the contingency to support projects in other areas, particularly the service yard project that we took forward last year. With regard to next year’s budget bid, there are quite a lot of potential costs that have deliberately not been budgeted for in our line budgets. For example, on the property and information technology side, we are re-tendering two major contracts. We expect to have double-running costs when the new contracts come in, but we have deliberately not budgeted for those costs in the line budgets; instead, we will take that out of the contingency. In short, the money is for meeting the costs of things for which we have no definite figures in next year’s budget.

09:45  

I note in the budget bid and forecast that the projected income figures are down from last year’s income figures. Why is that, given that in recent years the Parliament has—quite rightly—focused on increasing commercial activities and income?

Commercial activity has increased, but I think that we should not overstate the benefit that accrues from it. For example, the commercial events pilot is still finding its feet, and it has not as yet made a profit or a meaningful contribution to the cost of the Parliament. The corporate body has decided to extend that pilot a bit further, as we are now getting some repeat business coming in and more opportunity for it to contribute, albeit at modest levels. The shop also brings in additional income but, as members will be aware, we still subsidise the catering facilities.

Effort has been put into that area, but the contingency still has to cover quite a wide range of additional matters that arise. This year, we have reduced the additional element within the contingency, but I am concerned that it will start to come under pressure if any significant unforeseen events arise.

Can you explain why last year we had income of £262,000 and this year we are budgeting for £255,000? That is a bit of a drop.

I can probably answer that. The income is, in effect, the turnover from the shop, which is related to visitor numbers in the building, and we have seen a general trend over four or five years of visitor numbers reducing. With regard to the £262,000 figure for this year, our current year outturn forecast is that turnover will come down to the level that is in next year’s budget bid. The fact is that we are seeing a reduction in visitor numbers.

It is worth pointing out that visitor numbers and the income from the shop can sometimes be determined by the events that are held in the Parliament. As you will recall, the great tapestry of Scotland event in the entrance lobby generated huge visitor numbers and a very significant spike in the turnover of the shop in that year. The Parliament is obviously considering what other events can be held that would bring significant additional traffic into the building, which would then enhance the shop’s revenue. Revenue is obviously dependent on visitor numbers, and that particular event led to a significant increase.

Good morning. I want to ask about the ombudsman’s budget, which is to go up by £1 million from £3.5 million to £4.5 million. That is not a 15 per cent increase—it is a 30 per cent increase. I understand that the ombudsman’s statutory functions have increased because of the Scottish welfare fund, but has the workload increased by 30 per cent, too?

The total for the ombudsman represents an increase of £1 million. When we remove the £1 million for the new functions, we see that the increase is only 3 per cent on the 2016-17 budget. The majority of that is for staff costs in the second year of the two-year pay award that was agreed last year, and the award includes the healthy living initiative and staff progression elements. That is where the majority of the increase comes from, over and above the additional responsibilities.

The additional responsibilities are not that significant, are they? They are to hear complaints arising from the administration of the Scottish welfare fund, which is about £35 million. Are you suggesting that the increase in statutory functions will lead to a 30 per cent increase in the ombudsman’s business? If not, what is the justification for increasing the budget by that not eye-catching but eye-watering figure?

The increase will have been directly calculated as a result of the assessment of the additional responsibilities that the ombudsman now has and the way that they will have to be properly met to meet the legislative requirements that arise.

The increase represents a direct transfer of responsibilities from the Government to the ombudsman and was negotiated on that basis. The Government would expect to make a commensurate saving in its own expenditure. The negotiation took place principally between the ombudsman and the Government, and we were content on the basis that the transfer was agreed at that level.

So when the Government’s budget comes out next week, we can expect to see a saving of £1 million as a result of the increase in the ombudsman’s budget.

You might wish to raise that when you take evidence. [Laughter.]

The serious point is that it was a direct transfer. I think that some other functions were transferred as well as the welfare fund aspect, and we thought that it was an acceptable baseline transfer. We felt that, if the Government was content to accept it, it was reasonable from our point of view. Now that we have accepted responsibility for that transfer as the overall funder of the ombudsman, we will monitor the situation along with the ombudsman, and if the figure turns out to be more than required, we will report that back at a future date.

It would be helpful to know what the increase in the ombudsman’s workload has been as a result of the transfer of the powers in question and what additional staff the ombudsman has felt it necessary to appoint to cope with that increased demand. That will enable us to assess where the £1 million is going.

If Jackson Carlaw is happy for me to do so, I would be very happy to drop you a note with a bit more detail.

Yes.

That would be helpful.

I have two separate questions, the first of which is about contingency and legal costs. What was the total legal bill for the court action for removal of the illegal encampment on Parliament land? Are there realistic prospects of any of that money being recovered?

My recollection is that the cost was about £100,000. Paul Grice has the actual figure.

There is no separate contingency fund for legal issues. To respond to Mr Kelly’s point, I say that broadly speaking the contingency—usually about £0.5 million—is for pure emergencies, which could include substantial court expenses. Such things just cannot be predicted. As Derek Croll said, there are other issues on which we have an idea of what is coming, but for which we do not want to budget firmly. Unexpected legal costs would come out of that general contingency.

The process is not over yet—next week, we will be back in court to look at two issues. We are pursuing the matter of costs—which I will come to in a minute—and we must address the indy campers seeking leave to appeal to the Supreme Court.

The total cost to date has been just over £100,000. On whether we have realistic prospects of recovering that money, the first hurdle that we must get over is to persuade the court to allow us to seek recovery of some of the expenses. That is a matter for the court, but we are applying for that. If the court grants our request, it is likely that it will grant us a proportion of the expenses. That is what normally happens. We will have to take a judgment on that. One of my jobs in advising the SPCB is to assess how realistic our prospects are. In pursuing costs, one must never incur more expenditure than is likely to be recovered.

My starting point is that it is public money, so we have a responsibility to examine seriously whether recovery of some of it is possible. Ultimately, it is for the corporate body and me to judge what is right. When we appear before the committee this time next year, we will be able to update you on how that has gone.

Thank you for that helpful response.

If there were to be an appeal to the Supreme Court, the legal costs to the corporate body could be substantial. I presume that that would be covered by the contingency that you have built into the accounts.

That is a good example of the sort of cost that we would have to cover from that budget.

My second question is on an unrelated matter that I have raised previously: remuneration of committee advisers. I have felt for a long time that advisers to Parliament’s committees are not sufficiently remunerated for the work that they do. I know that there has been an increase in the daily rate—fairly recently, I think—but the daily rate now for committee advisers is not much more than my hourly rate when I was in the legal profession, which was 15 years ago. It seems to me that the rate that we are paying committee advisers is not a proper reflection of their contribution. Will the SPCB consider that?

I am happy—again—to ask Paul Grice to answer that, and to note the point that Murdo Fraser makes.

The rate is an issue that has been raised over the years; Murdo Fraser has made a fair point. We have to balance two things. First, of course, it is public money, and my approach is always to get the most that I can for the least amount of money. There is supply and demand to consider: if we look at it purely from a market point of view, there is still a substantial supply of very high-calibre advisers who are willing to work for that rate. On that ground, it is quite hard to justify unilaterally increasing the rate. We did, as you said, increase the rate by what I accept is a modest amount—I think from £137 to £150 a day. However, one of the benefits that advisers get is that having advised a parliamentary committee is a positive for their CV—it adds value.

I think that the corporate body would be reluctant to increase the rate at the moment, but we keep it under review. I know that the corporate body would consider the matter if committees of the Parliament, which we exist to serve, felt that they were not getting the breadth and calibre of people that they want. However, given that we are able to secure good advice for the price, it is hard to justify increasing the day rate.

Thank you.

One of the controversial issues in the SPCB’s budget is MSP pay. However, I am more interested in the wider pay policy for other people who work for the Scottish Parliament. Does that policy follow automatically in lock step with Scottish Government pay policy? If there were a change in Scottish Government pay policy, how quickly would the Scottish Parliament adapt to fall into line with it? For example, if there were a change in mid-year, would pay changes come out of contingencies, or are such things built into the budget?

There are two points to make. First, this is the first time that the budget submission has been the method by which MSP pay has been confirmed. As you know, we decoupled ourselves from Westminster, under which arrangement the MSP pay rate was 87.5 per cent of what Westminster MPs earned. In the current year, it is 81 per cent, which represents a reduction in the percentage. In the budget that we are looking at, there will be a 1.8 per cent rise for MSPs from April next year.

Secondly, pay for staff on the Parliament campus is the subject of a separate negotiation between the trade unions and the staff bodies. A two-year agreement was arrived at last year. I understand that the arrangement is not coupled to anything that relates to the Scottish Government; it is a quite separate negotiation. The two-year arrangement was arrived at and—as I mentioned in my opening remarks—the healthy living fund and other aspects that are peripheral to that agreement are also incorporated in this year’s budget. I imagine that at the end of the two-year period negotiations will recommence for the pay period thereafter. In answer to your question, Parliament staff pay is not directly related to staff pay in the Scottish Government.

Are non-MSP staff—people who work directly with the Parliament—also enjoying a 1.8 per cent increase?

The increase is about the same, actually.

It is about the same.

Is that the case across the board?

Yes.

I note that you propose for 2017-18 £107,000 for the modern apprenticeship programme aimed at young people aged 16 to 24. That is down £21,000, from £128,000, in 2016-17. Why is that reduction proposed? Is the MA programme something that could, through savings or underspends, be considered for additional expenditure?

That is a reasonable question. I invite Paul Grice to answer it.

10:00  

We are proud of our modern apprenticeship programme. We set out to employ 20 modern apprentices; the original plan was to appoint them in tranches of 10—the first in 2015 and the second in 2017. However, the quality of apprentices was phenomenally high, so I agreed that we would appoint 13 apprentices in the first tranche. I am delighted to say that the vast majority of them have now secured their Scottish vocational qualifications and are in the job pool in the Parliament, which is where we hope to keep them. Next year, there will be a tranche of seven.

The reduction for 2017-18 just reflects the fact that we took a disproportionate amount of the funding up front. That is the funding for the apprenticeship programme itself, but the idea is that the apprentices become available to take up jobs in the Parliament and are not funded through the apprenticeship programme but become part of the normal staff group. Derek Croll can say more about that if he wishes.

My current thinking on the numbers is that we will stick to the seven apprentices for 2017-18, which will give us the total of 20. The modern apprenticeship programme has been hugely successful, so I am hopeful that we will, with the corporate body’s agreement, look again for apprentices after the next tranche so that it becomes a rolling programme. It will depend partly on what we can afford, but it will also, as much as anything, be determined by the organisation’s needs. We do not guarantee jobs, but I very much hope that anyone who succeeds in their apprenticeship will be given the opportunity to work long term in the Parliament. We have to keep those two things in mind.

I will ask about our investment plans for information technology and bringing Parliament more into the digital age. There has been a substantial investment so far in technology and software for members and staff alike, which I acknowledge and welcome. However, can we make the Parliament’s website more multimedia friendly and digital friendly? For example, the Official Report is a fantastic resource, but it is all text. Is there any intention to introduce a multimedia element to that so that we can see video clips of speeches? That would help the general population, but it would also help people with sight impairments and it would be a good thing to do.

There has been astonishing increase in digital application and usage across the Parliament. I was astonished by the reduction in use of paper that the Parliament has achieved, which has been way beyond the expected initial reduction target. That reflects the fact that many different digital devices and platforms are being used across the Parliament in many different ways.

The budget for next year includes a significant increase in IT support staff and placements, given all the different platforms that need to be maintained and managed. However, we have also deferred some expenditures to maintain the overall budget level. Some of those touch upon areas that Willie Coffey has identified. As was explained to me, we will not yet be able to enter “Willie Coffey” into the website and have all your greatest hits come up for the world to see at the press of a button, even if that is our ultimate objective. There are some additional ways in which we need to continue to modernise but, because of some of the immediate pressures that we have, we have to phase those as carefully as we can to ensure that we maintain the immediate IT estate, in which—as you know—there is a lot of rolling change with members being introduced to new equipment.

Mr Carlaw is right. We have in mind a project to link pictures and text, but it is one of the projects that have been held. If the money becomes available, we might reconsider it. However, we have money firmly set aside to redevelop the website because we are conscious that it is quite some time since it was upgraded. I know that Willie Coffey has taken a long-term interest in the subject, so I would be more than happy to give him—or, indeed, the whole committee—a more detailed note on that. It is firmly in the plans. We have it in mind to link pictures and text, but that will probably have to sit and wait for money to become available—probably not this year, but perhaps next year.

Are there plans to engage with the public and to get people to feed in what they want or expect from the Parliament’s website?

That is a helpful idea. If it is okay with you, I will take that back to Alan Balharrie, who is our head of business information technology. I am more than happy to let you have a note. User feedback will be critical as we design our approach.

The commission on parliamentary reform, of which I am a member, is also considering the ways in which the public can access and involve themselves with the Parliament—for example, through the website.

In schedule 3, you set out a budget of approximately £2 million for IT expenditure next year. We hear from other businesses that IT costs are increasing substantially, partly because of the depreciation of sterling, as IT hardware and software tend to be denominated in US dollars. Are you experiencing increases in cost? Will you review the budget over the next 12 to 18 months to ensure that increased IT costs will be budgeted for?

I am sure that the answer to your second question is yes. The budget line represents a considerable increment in the number of people who will be employed in the estate on IT and digital maintenance and development. Some of the job titles are not always altogether clear to lay people such as me; I sought a proper explanation of what all the different people will be doing, and a lot of it will be linked to the different platforms that we have.

On the acquisition costs of IT, I do not know whether we have noticed a particular increase. Derek Croll might be able to respond.

That increase has not come through yet. A lot of the IT budget for the next year or so is for revenue costs—it is staff costs, so it is for stuff that is UK based, rather than equipment.

I thank Paul Grice for his answer on advisers—I would struggle to see why we should spend more money on advisers if we do not have to do so. What you said made a lot of sense. Also, I echo what the convener said about commissioners. I appreciate what Paul Grice said about the ombudsman, but a number of commissioners are getting increases of 5, 6 or 7 per cent, which seems to be substantial, given where we are.

The biggest spend item is staff. As a new member of the Parliament, I have been delighted by the level of support that the staff provide—it is important to acknowledge that. You said that in 2010-11 a review was carried out that resulted in a 10 per cent real-terms saving. I assume that that was business process re-engineering activity.

First, is there a plan to do that again? The review took place a number of years ago, and there is always more that we can do. Secondly, is the output of the work available for us to review, so that we can understand what was done at the time, what processes were re-engineered and to what effect?

In the circumstances that obtained at the time, there was a feeling that the Scottish Parliament had to look carefully at its employment overhead. There was a reduction of 68 employees in 2010-11, which was a significant fall. The number has gradually started to increase. A number of the additional posts that we are considering for next year relate to the Scottish Government and to the new lobbying register that the Parliament must put in place.

A full and comprehensive review is not something that we would undertake on a regular basis. Such a review would happen from time to time, and there would have to be a clear sense of what the outcome would be, in terms of any major restructuring of the Parliament. However, the answer is yes, in as much as the corporate body is, particularly where new posts emerge, always keen to ensure that such posts are justified, and to consider whether current posts are still required. I know that Paul Grice does that on an on-going basis.

Yes—that is where I am, at the moment. Members will recall that there was a crisis, really, following the 2008-09 position. At the time, the corporate body and I felt that we had to do something fundamental to reduce the head count and costs. There is nothing published on that, but I am more than happy to see what I can do. For example, I did a pretty fundamental review of the senior management of the organisation at the time. I am more than happy to write to the committee with more on that.

There is always a cost to such things. In an organisation that is subject to fundamental reviews, there is a certain amount of stress and anxiety in the system. You have to weigh the two elements up. To reinforce the point that Jackson Carlaw made, the position at the moment is about on-going work, constantly striving for improvement and always looking for innovation. That is the model that we have at the moment, and we will go forward on that basis.

Members all know as well as I do that we live in uncertain times. Were there to be a further substantial change in our circumstances that I felt would require a more radical review, we would do the same again. However, for the moment, we are simply looking continuously to improve. I would be more than happy to share with the committee anything that I have from the 2008-09 period.

Please do. It is always a good idea to fix the roof when it is not raining. I encourage you to strive for innovation when you can.

My other question concerns the £7 million running costs. That is the other chunk in the document that is not parcelled out. Is there a breakdown of that figure? The document says that it is for services that you are buying in and so on.

Derek Croll might be able to help with the detail of that.

Those costs include a lot of outsourced contracts—our IT support contract, general advisers, porters, catering, cleaning, telephony and so on. There is a lot of stuff within that. The IT support contract is the largest element.

It might be helpful to have a next-level-down breakdown of that £7 million figure.

We can let you have that. I point out that, through our procurement strategy, we have a forward look at the big contracts. Where we can, we share Government-negotiated contracts, which represents good value for money. When we do not think that that is appropriate, we take a strategic look at how to bundle contracts so that we can get best value. That has often been a source of savings. Of course, we must bear it in mind that quality is important, too, for the reasons that have been outlined. Again, however, I am sure that we can let you have a note setting out the numbers in more detail.

Thank you.

I have a final question. I am conscious that we have quite a lot of new members on the committee; I am not sure whether they are entirely aware of how you requisition your resources in relation to the Scottish block grant. Can you give us a quick résumé of how that works?

I think that that one is for you, Paul.

There is an important constitutional point underlying our position, which is that Parliament has the privilege of making its budget bid separate from the Government and before the Government does so, and it bears the responsibility that goes along with that. That is why we are here before the committee today. That arrangement recognises the fact that the Scottish Parliament must, in its funding, be entirely independent of the Government. There has never been an issue in that regard, but it is a constitutionally important point. Members might be wondering why we are here to discuss our budget ahead of the Government. That is why. After a budget has been proposed by the SPCB and, hopefully, agreed by the Finance and Constitution Committee, it is netted off from the Scottish block grant, and what is left is what is available to the Government. That is the important constitutional position that is enshrined in law. I hope that that is helpful.

I am sure that it will have been helpful. Perhaps it should have been my opening question instead of the final question.

I thank the witnesses for their evidence today. You have committed to giving us a number of pieces of additional information, and we look forward to receiving them.

We are a wee bit ahead of time; our next witnesses are not due until 10:30. I suggest that we amend the agenda slightly and move now into private session before coming back into public session at 10:30.

10:14 Meeting continued in private.  

10:33 Meeting continued in public.