Financial Scrutiny Review
I open the sixth meeting in 2002 of the Finance Committee and ask members to ensure that their mobile phones and pagers are turned off, as the meeting has opened in public. I have received no apologies so far.
Item 1 is on the financial scrutiny review. We agreed at our meeting on 29 January to undertake a review of current financial scrutiny arrangements. I went away, with others, to produce a scoping paper, which examines the origins of the scrutiny process in relation to the financial issues advisory group and whether and how that group's recommendations have been implemented.
The paper also considers the statutory basis of the current system in relation to the Public Finance and Accountability (Scotland) Act 2000.
Extensive discussions were held—mainly by Murray McVicar—with experts in the field, some of whom were members of FIAG, with the aim of gauging opinion on the current arrangements and discussing whether changes need to be made to improve the system. The paper also contains background work on budgetary practices in local authorities and the private sector, which provides us with a useful contrast.
Members might wish to know that we had a round-table discussion with a number of former members of FIAG last week, which yielded a number of other points. Among the main points was the view that there is a requirement to take a more strategic approach to budget scrutiny, which the former FIAG members acknowledged. There are opportunities to streamline existing procedures, but FIAG's former members did not think that we should abandon stage 1 of the budget process, because it gives us the best opportunity to influence the Executive's budget deliberations.
The view was expressed that we need access to better support mechanisms if we are to carry out the role that we should carry out. The view was also expressed that it would be helpful for us to consider the underlying issues outwith the budget cycle from different perspectives using two-year or five-year cycles, depending on the issue.
The former FIAG members were supportive of the idea of cross-cutting expenditure reviews. There was a strongly expressed view that the financial memorandums for legislation need to be strengthened and to specify the particular financial implications of legislative proposals. It was felt that spending announcements should be clearer about where money comes from and how it will be applied.
Most of those comments have been made by members of the Finance Committee at different times. I understood the former FIAG members to be suggesting that we had identified most of the right issues and that we could move incrementally towards some solutions. The scoping paper contains many big issues and I am happy to take comments from members at this point.
In simple terms, the discussion has been going on since the committee was established and we entered the first year's budget round. Everybody realised then that the process was evolving and that the first go at it would never be right.
Given the broad issues that the paper has brought up, the best way forward at this stage would be for someone else to write a tighter, shorter strategic paper for us to discuss.
I agree with David Davidson. Such a paper would focus the mind. After reading the scoping paper, I was not clear about exactly what we were going to do. A shorter, sharper paper would help.
That is fair enough. I am content with that approach. It is important to get down on paper the full range of what we might do. What we do thereafter needs to be more tightly focused. The process has clarified in my mind what we might do.
I am trying to think of what we need to do and where we are going. Page 11 of the scoping paper identifies issues that members might want to take further. Do members think that it would be inappropriate to take any of those further?
I am sorry, convener, but I suggested that someone outside the committee, possibly our adviser, could take the breadth of the paper—which seems to be multi-authored, going by the approach taken in different parts—and pull it into something tighter that the committee could consider, rather than our taking the paper apart just now.
Such a paper should include options and recommendations on which we could decide. I do not think that further discussion of the scoping paper will achieve much.
Professor Arthur Midwinter (Adviser):
I would be happy to produce such a paper, if the committee is so minded. There are a number of issues that have been flagged up for discussion on which progress is being made. A shorter paper that identified areas where we are making progress would be helpful. With that, we could focus on the aspects of the process about which we are more concerned. I will happily do that for the committee, if members so wish.
I suggest that David McGill liaise with Arthur Midwinter in order to proceed with that. I presume that we could have the paper in time for the next committee meeting. Is that possible?
When is the next meeting?
On 16 April.
That is fine.