Chamber and committees

Whenever I have looked at the national performance framework, I have been struck by how it seems to be strongly influenced by the balanced scorecard approach that we see in a lot of modern management thinking. The Kaplan and Norton paper from back in the early 1990s that instituted that thinking highlights four areas: customer perspective; internal perspective, or looking at what the organisation excels at; innovation and learning; and shareholder return. Not all those areas apply to government, but there are analogues such as the citizen’s perspective, and the last one about how we generate revenue, or the economic perspective.

The other critical thing that Kaplan and Norton say is that those measures have to be explicitly linked to goals. The national performance framework seems to be very broad, and it does not appear to have that level of focus. Certainly, those perspectives do not necessarily seem to be preserved down to the level of the national performance goals. On reflection, as we look to improve the national performance framework, I wonder whether greater focus—so that those measures could drive strategy rather than being a broad basket of measures—would be of some advantage.

One of my worries with the national performance framework is that it is very broad, in terms of both how the objectives are framed and the number of measures that sit below those. I wonder whether there is a missing layer. For example, the national outcome for children and young people is:

“We grow up loved, safe and respected so that we realise our full potential”.

I do not think that anyone anywhere would disagree with that as an objective. When we go through the national framework, we then immediately descend into some quite detailed statistics. I wonder whether an intermediate layer is required, on how the overall objective will be achieved and on what measures will drive that. Ultimately, we have to discriminate between different measures, because some measures will essentially be input measures, while others will be output measures. Some measures will trail, and others will be early indicators. Without that strategic emphasis on what is more important and without differentiating between different types of measures, we just have a sea of data, which does not drive change or orient behaviour across government.

Do the other witnesses have anything to add?

I would like to follow up the discussion on the operation of the fiscal framework. The 2019-20 budget contained tax proposals that should have raised an additional £500 million, but, because of the block grant adjustment and the fiscal framework, only £148 million of additional funding came to the Scottish Government. My understanding of that is that we did not do such a good job of growing the number of taxpayers in Scotland or their ability to pay tax—in other words, how much money they were earning. Is that correct? If so, what does that tell us about the policies that are being pursued in Scotland to grow the tax base and earnings? Does it tell us something about the Scottish Government’s ability to use the big fiscal lever that it has, or does it, in fact, show that that lever is not really effective? I am trying to remember what I learned in economics in my first year at university on elasticity of demand and the tax rate. Does it tell us that people switch behaviour when we alter tax rates in Scotland?

I ask David Eiser to respond first, but I am interested in hearing from the other witnesses.

Do Susan and David agree that we need to both prioritise enterprise support and increase its focus? Would you support that proposition?

Please do.

I take your point about the public sector, but a significant number of people—if not most people—who have been on furlough are employed by the private sector. What policy interventions would you like to see? Would they involve skills and retraining or perhaps job guarantee schemes? What interventions would the STUC like to take place to preserve private sector employment?

I wonder whether you can identify any particular consequences. Are there areas of provision that you think are particularly exposed or that have suffered because of the funding shortfall?

Are there any final thoughts before I move on?

My questions follow on from what Gail Macgregor said about the level of funding for local authorities. First, on COSLA’s previous budget submission, you stated that there would be a £500 million shortfall after the budget revisions. Was that the case? If so, I would be interested to know what the consequences were, given what you have said about the difficulties that local authorities face in delivering core, statutory services on the basis of current funding.

Secondly, given that that budget process was undertaken midway through the pandemic and that many of the services that councils provide are fundamental, safety-net services, what is your current assessment of the increase in demand and, therefore, the current shortfall that local government faces?