Public Services Reform (Scotland) Act 2010 (Part 2 Extension) Order 2015 [Draft]
Good morning, and welcome to the 15th meeting in 2015 of the Finance Committee of the Scottish Parliament. I remind everyone present to turn off mobile phones, tablets and other electronic devices.
Our first item of business today is to take evidence from the Cabinet Secretary for Finance, Constitution and Economy, John Swinney, on subordinate legislation on the Public Services Reform (Scotland) Act 2010. Mr Swinney is joined by his official, Victoria Bruce. I welcome our witnesses to the meeting, and invite the cabinet secretary to make a short opening statement.
Thank you, convener. The Scottish Government is seeking to extend part 2 of the Public Services Reform (Scotland) Act 2010 for a further five years. That part of the 2010 act came into effect on 1 August 2010, but due to the addition of a sunset clause during the passage of the bill, its powers will expire on 1 August 2015.
Part 2 allows ministers to make orders to
“improve the exercise of public functions, having regard to ... efficiency ... effectiveness, and ... economy”,
and to make orders to “remove or reduce” burdens. Eight orders have to date been made under part 2: three have been made under section 14 on efficiency, effectiveness and economy, and five under section 17 on removing or reducing burdens.
In summary, the orders have declassified the General Teaching Council for Scotland as a public body and turned it into an independent profession-led organisation; transferred the functions of the Public Standards Commissioner for Scotland and the Public Appointments Commissioner for Scotland to the new Commissioner for Ethical Standards in Public Life in Scotland, at the request of the Scottish Parliament Corporate Body; created the roles of prison monitoring co-ordinator and independent prison monitor, and transferred the functions of prison visiting committees to those roles; provided the basis for measures to provide greater confidence in the working relationships between landlords and tenant farmers; enabled ministers to recover the costs of Education Scotland’s inspection of independent further education colleges and English language schools; helped to streamline and simplify the planning system in two specific areas; and allowed NHS National Services Scotland to provide shared services across the public sector with a view to improving efficiency and productivity.
Although, during the passage of the bill, committee members expressed concerns that the powers in part 2 might be misused, the fact that a relatively small number of orders have been made, to make important but small-scale changes, should provide reassurance that the powers have been used appropriately. In each case, the orders were subject to full public consultation and parliamentary scrutiny and, where necessary, to amendment.
Where significant changes to the public bodies landscape have been proposed, those have—quite appropriately—been delivered through primary legislation. A recent example is the merger of Historic Scotland and the Royal Commission on the Ancient and Historical Monuments of Scotland, which was done through the Historic Environment Scotland Act 2014.
It is vital that we retain the order-making powers for another five years because they provide the Government and Parliament with flexibility to make changes quickly, as and when opportunities arise, without introducing primary legislation. Streamlining and simplifying the public bodies landscape is a continuing process, and wider developments such as the further devolution of powers to Scotland and the on-going challenging financial context mean that the powers continue to be relevant and necessary.
I reassure members that the additional safeguards that were introduced by Parliament during its consideration of the eventual Public Services Reform (Scotland) Act 2010—including in relation to consultation and scrutiny—will remain in place, in response to points that were raised by the Delegated Powers and Law Reform Committee that the Scottish Government has not revised its approach to consultation. We continue to believe that consultation is an important aspect of Scottish Government working methods that should be carried out on proposals for legislation, except on rare occasions like this.
As the order seeks only to extend the duration of part 2 of the 2010 act, and as the provisions themselves contain no detail, the only views that a consultation could have elicited would have been for or against continuation, and would not have led to any changes to the order. It is therefore unlike the vast majority of legislation, on which full and substantive consultation on provisions can take place.
We consider that the best evidence on the impact of part 2 is the way in which it has been used in practice since it came into force. On each occasion, the orders have been subject to full consultation. There have been no communications to the Scottish Government since the enactment of the 2010 act suggesting that the powers have caused problems or have been used in an inappropriate manner.
The Scottish Government continues to believe that the powers provide an essential mechanism for making small-scale changes to public functions. Ultimately, it is for Parliament to decide whether or not the powers should be continued on the basis of their past use and potential future use in relation to improving efficiency, effectiveness and economy, and removing and reducing burdens.
I am happy to answer questions.
Thank you for that opening statement. You of course touched on the issue that has come to prominence and which is raised in the response of the Delegated Powers and Law Reform Committee. It wrote to me about consultation, and you talked about your thinking behind that, but I will highlight some of the issues that the DPLRC has raised. It said that it
“is concerned to note that the Government takes the view that it is unlikely that stakeholders would have any particular views on the matter.”
Furthermore,
“it considers that for members to make an informed decision there would have been benefit in having the findings of a consultation exercise to draw upon”.
The committee also notes
“that individual occasions on which the powers are exercised have been the subject of consultation but that such instruments raise an entirely different issue to that posed by the current draft order.”
The convener of that committee, our colleague Nigel Don, has therefore asked the Finance Committee to pursue the matter. Given the concerns—of which I know you are fully aware—that have been raised by the DPLR Committee, will you say more about your thinking on the matter?
The issues around provision of the powers in the Public Services Reform (Scotland) Bill in the first place were well exercised in parliamentary debate; indeed, the Government responded to the discussions and debate at the time in the provisions that were finally enacted—in particular, the sunset clause.
We now have the benefit of having seen over five years how the power has been utilised: it would be impossible to sustain an argument that the power has been used for any purpose other than that for which it was originally conceived. As I said in my opening remarks, since 2010 the Government has received no representations that suggest in any way that it has used the powers for any other purpose. Therefore, the judgment that I arrived at was that, given that any change that we would undertake using the powers in the 2010 act would itself be subject to consultation and full parliamentary scrutiny as a consequence, the mere continuation of that responsibility, which has been properly, fully and exhaustively debated in Parliament, did not merit a specific consultation. That was the basis of my judgment as to why it is appropriate to proceed as we have done.
As the cabinet secretary will probably know, I am a member of the Delegated Powers and Law Reform Committee, at which some concern was expressed. On the principle, if not many measures have been taken forward using the power in the past five years, why do we need to continue the power for another five years?
We have made eight orders. If we had not been able to use the approach that is provided for in the 2010 act, those changes would either not have taken place or would have required more exhaustive primary legislation. I deliberately went through the range of subjects that have been addressed under the provision—they have been minor amendments to the landscape of public bodies. They are the sorts of things that were in the past habitually left unattended until a primary legislation vehicle came along that would enable them to be done. When that happens, the parliamentary debate is often about the fact that the Government is addressing a multitude of topics all crammed together in one piece of primary legislation. That raises concern in Parliament about the focus of the primary legislation.
The power has given us the ability to deal with relatively minor issues. Such minor issues will, I think, continue to occur as we continue to amend the public bodies landscape in Scotland and to address such questions. As a consequence, the power is a useful and practical one to have at our disposal, because it avoids recourse to more time-consuming primary legislation.
On the specific point about consultation, we know that the 2010 act was quite controversial when it was passed, and a number of groups made the point that their independence might be compromised. I presume that the sunset clause gave some reassurance that, if there were problems and issues with independence, the legislation would be in force only for a limited time. You say that those groups have not made many comments over the past five years, but we are not going out to ask them whether they have any comments to make. Do they still have those fundamental concerns about independence? We do not know, do we?
When the 2010 act was passed, a lot of comments were made in Parliament about the nature of the provisions and what they would be used for. All sorts of suggestions were made about how the powers would be misused, but there is not a scintilla of evidence to support the rather lurid comments that were made when the legislation was passed in 2010. From that point of view, there is considerable reassurance about the practical utilisation of the powers of the Government, which were conferred by primary legislation that Parliament clearly voted for. The powers have been exercised in that effective way. I am pretty sure that, if people had issues and concerns about exercise of the powers, we would have heard about them. However, we have not heard that over the five years. My perspective is that Parliament legislated for the powers and provided the opportunity for them to be extended if Parliament so chose; Parliament has been invited to do that today.
One of the considerations regarding whether there needs to be a consultation is the history of the policy area. Do you accept that because the policy has been controversial, history suggests that there should have been a consultation?
No, because the responsibilities that the order will continue have been exercised in a way that has not given rise to any concerns such as were put to Parliament back in 2010. All sorts of speculation was put to Parliament in 2010 by people who opposed the provisions that the Government was pushing to put in place. When we look at developments since then, we see that there was no substance in those concerns.
A provision that Parliament properly and effectively legislated for will simply be extended by the order that is before the committee today. In addition, any action that follows on from or arises out of that will be the subject of consultation. There is, therefore, the protection both of consultation and of parliamentary scrutiny and decision making in relation to all such orders. The crucial point is that Parliament itself legislated for the provision five years ago and judged that it is an appropriate power, and the history of our exercising the power has been entirely consistent with what I told Parliament at the time would be the case.
You indicated that you used primary legislation to confer the powers. If the order is agreed to today, is there a firm Government commitment to continue in that vein so that any significant changes to the public sector landscape, should there be any, will be made through primary legislation, and that you will use the powers in a broadly similar way to the way in which you have used them over the past five years?
09:30
I propose to use the powers in an entirely similar way to the way in which I have used them over the past five years. The key point to make in addressing that question is that the way in which I have exercised the powers has been entirely consistent with what I told Parliament in the run-up to enactment of the Public Services Reform (Scotland) Act 2010. I am very happy to confirm that our actions will be entirely consistent with what has happened in the past five years and with the explanation and assurances that I gave Parliament five years ago.
At the time when the Government sought the powers, it was envisaged that the public sector would be going through a huge amount of reform. One of the arguments that the Government gave for having the powers—as a review of the debates that took place at the time seems to show—was that reform meant that the Government needed to be fleet of foot, and it was thought that five years was an appropriate period. This is not an easy question to answer, but do you envisage the powers being held by Government in perpetuity and simply being renewed every five years, or is it your view that if the order is agreed to, we will probably not need such powers in five years?
The changes that have been made through use of the powers have been minor alternations to the public sector landscape. I am looking well into the future here, but I think that in the real world such minor changes to the landscape will probably continue. There will be major reforms of the public sector landscape in Scotland but—as Mr Brown quite rightly highlighted—those changes will be made through primary legislation, because they will require to be subjected to the extensive and full scrutiny that is appropriate for such major changes. Without prejudging what the situation will be in five years’ time, I imagine that there will still be a need for minor alterations of the kind that we have already used the powers to make.
You said that Parliament gave its approval for the relevant part of the Public Services Reform (Scotland) Bill, but it did so for five years. Regardless of the merits of the case, is there not an issue about the nature of a sunset clause and what Parliament’s intention is when it insists on a sunset clause?
That is correct: it is precisely why the committee is considering an order that provides for exercise of the powers to be extended for a further five years, provision for which was made in the primary legislation. Parliament has provided for that to happen; it cannot happen automatically—there has to be parliamentary scrutiny and consideration. Use of the powers has been entirely consistent with what I proposed to Parliament five years ago; I think that that serves as the basis for a framework of parliamentary assurance.
Would it have been such a big problem to consult? It might even have proved your case for you if all the people who had been concerned had written in to say, “It’s fine. We don’t have a problem with this any more.” My point is about the nature of a sunset clause. Is there not a requirement to look at the issue afresh after five years? When legislation is considered afresh in the Scottish Parliament, it is normally consulted on.
For me, the issue is largely to do with the way in which we have exercised the responsibilities in question. If we look back at the reasons that I was accused of having for wanting to take the powers back in 2010, the evidence does not substantiate the argument that was made. The arguments were well rehearsed in 2010; Parliament made provision for the provisions to be extended if it so chose, and the manner in which the powers have been exercised is entirely consistent with that approach. Therefore, we are in a position in which Parliament can take that decision today.
Have you considered any precedents on the treatment of sunset clauses in previous legislation?
There will be a variety of examples in which consultation took place and in which it did not take place. My judgment on the point was relatively straightforward to arrive at: the powers had been provided for, our actions had been consistent with what we had said to Parliament, therefore there was an argument for extending the powers in this fashion.
You said that the powers have been used eight times over the past five years. Do you expect that they will be used more frequently or less frequently over the next five years?
It is difficult to say, but I envisage the powers being used in similar circumstances. Therefore, whether they are used once or 20 times, it will be only for minor changes to the landscape of public bodies. However, in all circumstances, changes will be consulted upon individually as a consequence of any order being laid under the powers.
The general point that Mr Brown pursued in his questions concerned whether we were dealing with an entirely static public sector and public bodies landscape. The answer to that question is no. We will face changes and I imagine that we will have to make changes on the basis of efficiency and economy, as the 2010 act provides for. However, it is not possible at this stage for me to provide a definitive view on how often the provisions will be used.
The powers could be used far more often over the next five years, depending on the agenda for public sector reform. Given that, would it not have been better to take a belt-and-braces approach and ensure that there was further consultation at this point before we embark on a period in which they might be used more frequently than they were over the previous five years?
No, because the assurance to Parliament—which I put on the record in response to Mr Brown—is that the use of the powers would be entirely consistent with the type of changes that we have made and that we suggested in parliamentary debates during the passage of the Public Services Reform (Scotland) Bill.
If, in five years, the Government proposed to extend the powers again for a further five years, would it be acceptable to say again that there was no need to consult on the provisions, even though it would be 10 years since the act had been passed?
That judgment would have to be made at that time. Ministers would have to come to a view then. The way in which we have exercised the powers demonstrates that we have remained entirely faithful to the commitments that we gave to Parliament in 2010.
My question was answered in your responses to Mr Brown and Mr Chisholm on when the sun sets on a sunset clause. We have clearly been canny about using the legislation, but if—God forbid—you are not the cabinet secretary, would there be any opportunity for abuse? There was clearly anxiety in the debates on the bill, which allowed for a temporary fix.
I do not think that an opportunity for abuse for exists for three reasons. First, the power would have to be exercised consistently with what I said to Parliament during the passage of the 2010 act. To be frank, if a minister were trying to undertake major reforms of the public sector landscape through the power, their argument would have poor foundations because that change would exceed what I put on the parliamentary record in 2010 so they would struggle to sustain that argument.
Secondly, any individual instrument must be the subject of separate, distinctive consultation and parliamentary scrutiny, which provides protection.
Thirdly, there are now five years of precedent; if a minister were to propose more significant change that one considers would merit primary legislation, that body of precedent would be against their argument.
Every one of the orders that we have laid has been subject to consultation—this relates to the core question of consultation, with which the committee has wrestled—so stakeholders had the opportunity to say that the change in each provision was outwith the spirit of the 2010 act. That did not happen.
There is now established practice about how the powers can be exercised and ministers would be unable to sustain an argument if their actions were not consistent with the three elements that I have set out.
That concludes questions from the committee.
Motion moved,
That the Finance Committee recommends that the Public Services Reform (Scotland) Act 2010 (Part 2 Extension) Order 2015 [draft] be approved.—[John Swinney.]
Motion agreed to.
The committee will now publish a short report to the Parliament setting out its decision on the draft order.
I thank the cabinet secretary for attending.
09:41 Meeting suspended.Previous
AttendanceNext
Fiscal Framework