Audit Committee, 05 Dec 2006

Meeting date: Tuesday, December 5, 2006

Official Report 262KB pdf

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Transport in Scotland

We have copies of the Scottish Executive's response to the Auditor General's report "Scottish Executive: an overview of the performance of transport in Scotland". Members will have the opportunity to discuss the Executive's reaction to the comments that we made. We sought clarification from the Enterprise, Transport and Lifelong Learning Department on a number of issues.

The department states:

"implementation of the cap"

on payments

"is unlikely to be necessary."

I hope that it holds to that position, because later in the response it states:

"In our view there is no reason to think that the operation of the Scheme will be affected by anything other than a major breach of the cap".

I hope that that will not be necessary. I have the impression from the department's letter that the risk about which the committee was concerned is not on the horizon but, with subsidies, financial circumstances can change very quickly.

We are told that

"early indications are that implementation of the cap is unlikely to be necessary",

but how is the scheme being monitored, and how quickly and effectively can action be taken, if needed? I notice that

"Transport Scotland collects some bus survey information to benchmark operator claims on passenger numbers and fare foregone."

What is meant by "some bus survey information"? How big is the sample, how often is the information collected and how effective is it?

I am not in a position to answer that question. I am not sure that Audit Scotland is either, but Graeme Greenhill will tell us what he knows.

I will have a go at the first question, but I am afraid that the second question is beyond me. As one would expect, the Executive monitors expenditure monthly, so it should be in a position to respond quickly if there is any indication that its budgets are threatened. I do not know about sample sizes and frequency of inspections.

Audit Scotland knows that the Scottish Executive's audit unit recently commenced a review of the scheme, in which it will examine monitoring and management arrangements. Clearly, the review is of interest to our auditors, who will monitor the results of the unit's work with a view to using it to inform their audit of Transport Scotland.

Thank you.

We are told that the Executive is "looking to commission research", but it gives no indication as to the timescale or depth of the research. What exactly does the Executive mean by "looking to commission"? That is not the same as commissioning. I would like to know whether and when the research will happen.

Can you answer that question, Graeme?

The committee will need to put that question to the Executive.

I thought as much. Our options are to note the response and keep a watching brief or to write again to the Executive asking for further clarification. Of course, the second option could lead to a constant exchange of letters.

We asked:

"Does the Department undertake any work to compare the process of project implementation in Scotland and other parts of the UK with that in other countries in order to find ways in which projects can be managed more cost effectively and quickly?"

However, we got only a partial answer. The Executive talked a bit about trunk roads without giving a great deal of detail and then went on to say something about rail. I would like to have seen a bit more on current major projects, such as the Edinburgh tram system. Previously, I have expressed concern that we do not seem to have much in the way of an on-going audit of costs in such major projects. When we find ourselves faced with escalating costs in a project, it might prove useful to have audits of the gateways or exit points along the way. A system of on-going audit would mean that we would not have to wait for projects' completion, which can take several years. I suggest that we ask the Executive whether an on-going audit process could be used to benchmark its major public transport infrastructure projects against what is happening elsewhere in the world. As I said, we received only a partial answer to that question.

I get the impression that members feel the need to raise other issues with the Executive. Obviously, at our meeting of 24 October, we decided not to do a report. However, it is open to us to write again to the Executive.

I do not want a constant exchange of letters; I simply seek clarification of the facts and the action that the Executive is pursuing. We have received answers that appear to tell us everything, but which in fact do not: there are answers and there is the appearance of answers.

Sure. Do you have anything to say on the point that Margaret Smith raised on the need for on-going audit, Graeme?

I will be informed by advice from the Auditor General and Caroline Gardner, but the Auditor General's forward study programme includes a project in which Audit Scotland would look at major capital projects. The issue might come up as part of that work.

I have little to add other than that we have previously mentioned our view that there is mileage in examining such significant areas of investment. Obviously, transport accounts for considerable expenditure. Over time, in addition to looking at what progress has been made, we may be able to develop benchmarking measures.

That being the case, I do not see much point in following up the issue at this stage.

I understand that many of the issues that crop up in such projects occur not just in Scotland or the United Kingdom but in similar projects around the world, so benchmarking might prove to be quite useful.

That being the case, we can seek clarification on only two points from Andrew Welsh's list. We can send a relatively short letter. I do not want to encourage a response that will result in our having a further long discussion on the subject, but I am happy to have clarification of the points that Andrew Welsh feels are not lucid enough.

I would still like more information on auditing of major projects. I appreciate what the deputy auditor general said on the matter, but I have raised the issue before. In the short term, we should at least seek a response from the Executive. We can consider the issue again in the future.

I propose that the clerks, when they have seen the Official Report of today's meeting, should draft a short letter seeking clarification of those points and noting the rest of the response. Is that agreed?

Members indicated agreement.

We have completed the process for agenda item 4, so I thank Graeme Greenhill and Caroline Gardner for the clarification that they have provided.

Agenda item 5 is oral evidence taking for our review of community planning partnerships. Before we start that, we will have a short break. We will recommence at 10 past 11.

Meeting suspended.

On resuming—