Audit Committee, 26 Apr 2005

Meeting date: Tuesday, April 26, 2005

Official Report 104KB pdf

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Accountable Officer Written Authority

We move on to agenda item 3, which concerns accountable officer written authority. Members have received a copy of the written authority that has been given to the accountable officer of the Scottish Executive Enterprise, Transport and Lifelong Learning Department with regard to the Ballycastle to Campbeltown ferry. I invite Audit Scotland to provide some context to this matter.

Committee members should bear it in mind that, under our remit, we are tied to the consideration of laid documents. Under the terms of the Public Finance and Accountability (Scotland) Act 2000, we have been provided with this document so that we can note it. However, I will say more about that after the Auditor General for Scotland has addressed the committee.

It might help if I remind the committee of the legal background to this matter. If an accountable officer faces the need to take an action that he or she believes is inconsistent with their duties, they are required to seek a direction from the relevant minister if the matter is to proceed. The minister might then authorise the accountable officer to take such action.

Although not many such directions are made, they happen from time to time and most commonly relate to value-for-money issues. The 2000 act requires the accountable officer to make a copy of the direction available to the Auditor General, which is what has happened in this case. However, it does not specify what the Auditor General is expected to do with the direction. I guess that that is understandable because the direction usually precedes any incurring of expenditure. My interpretation of the matter is that if I receive notification of a direction, I alert the relevant auditor to ensure that the matter is subsequently reported, if that is felt appropriate.

As an administrative act, the principal accountable officer has arranged that accountable officers should copy the notification of the direction to the clerk of the Audit Committee to ensure that committee members are made aware of it. There is nothing that I must do formally, but I should ensure that the relevant auditor is aware that a direction has been made and is vigilant about any spending that may occur. That said, I venture to suggest that, given that no expenditure has yet been incurred, the Audit Committee has no power to act at this time.

We have been circulated with a paper that sets out the written authority. There are several options that the committee can choose from. First, we can write to the Executive for information, but I suspect that we would not get much of a response at this stage. As the Auditor General has explained, Audit Scotland will take into account the fact that written authority has been sought, and we will have something to discuss once Audit Scotland has something to report to us.

We could also write to the Local Government and Transport Committee to allow it to note the matter and to take whatever decision it wishes on it. After all, it is not tied by our remit, which allows us to discuss only laid documents.

I think that the written authority has been submitted simply for us to note. At this point, I invite members to ask the Auditor General any questions if they think that that might be of help or to make any points or comments. I should add that George Lyon, who has sent his apologies, asked me to point out that he supported the ministerial direction. However, on this matter committee members' support is neither here nor there.

Am I right in thinking that this notification has triggered a safety device in the Public Finance and Accountability (Scotland) Act 2000? I see that the committee is invited to note the document and to draw it to the Local Government and Transport Committee's attention. However, I am tempted to add the word "strongly" to that invitation. The situation must be quite serious for an accountable officer to seek what is de facto an indemnity for an action that he has been asked to undertake. In any case, we should certainly alert the Local Government and Transport Committee. It is part of that committee's remit to consider whether it should press the matter any further.

We can certainly draw the matter to the Local Government and Transport Committee's attention. It does not really matter whether we do so weakly or strongly; I think that it is more than adequate simply to draw the document to that committee's attention, as we will not have to get drawn into any discussion about the policy issues that surround it.

I know that we cannot get drawn into such discussions. However, it is our duty to point out that the notification has triggered a safety mechanism in the 2000 act.

The Auditor General has made it clear that the written authority will be notified to the relevant auditor, who can examine the matter more fully. Perhaps at that stage the committee might feel that it has some role to play. However, at the moment, we do not have any role other than to note the notification of the written authority. I accept Andrew Welsh's point that we should draw the matter to the relevant committee's attention; what happens then will be a matter for that committee.

I wonder why we are not flagging the matter up to the Finance Committee as well. After all, it examines the budget.

I am quite open to the suggestion that we copy the Finance Committee into our notification of the matter to the Local Government and Transport Committee.

I am clearly missing something here. In what circumstances could the accountable officer feel that the action that he has been asked to take might be

"inconsistent with the proper performance of"

his function?

The question is whether value for money is being achieved, and the accountable officer makes this determination if he is concerned about value-for-money issues. I seek the Auditor General's guidance, but that is my understanding of the purpose of the written authority.

Mr Black indicated agreement.

So that is the indemnity. The accountable officer might think that something is not a good idea.

We have received such notifications before. For example, we received one about the relocation of Scottish Natural Heritage.

I believe that Robin Harper's point is covered by section 15(8) of the 2000 act, which states that accountable officers have a duty to obtain written authority from ministers if they consider that any action that they are required to take is

"inconsistent with the proper performance"

of their functions. I believe that that is straightforward.

Given that there is little more that we can say or do about the matter, that, as Andrew Welsh has pointed out, it is a question simply of notifying Audit Scotland and the Audit Committee about the written authority, and that—perhaps for good reason—the 2000 act is not specific about the actions that the Auditor General is meant to take, I suggest that the committee simply notes the written authority. It has also been proposed that we inform the Local Government and Transport Committee and that we copy the Finance Committee into that correspondence. Are members agreed?

Members indicated agreement.

We will take those actions. We now move into private session for the rest of the agenda.

Meeting continued in private until 11:17.