Economy, Energy and Fair Work Committee

Meeting date: Tuesday, February 16, 2021

Official Report 660KB pdf

Subordinate Legislation

Companies Act 2006 (Scottish public sector companies to be audited by the Auditor General for Scotland) Order 2021 [Draft]

Item 3 relates to the Companies Act 2006 (Scottish public sector companies to be audited by the Auditor General for Scotland) Order 2021. I welcome Fiona Hyslop, Cabinet Secretary for Economy, Fair Work and Culture; and Gary Jones, finance business partner, Scottish Government.

I invite the cabinet secretary to make her opening statement on the instrument.

I thank the committee for taking the time to consider the draft legislation.

Ferguson Marine (Port Glasgow) Holdings Ltd is a new public body that was established in December 2019 when the Ferguson Marine business was brought into public ownership. My team has engaged closely with Audit Scotland on the appropriate approach to the audit of the business accounts and the role of the Auditor General for Scotland in that. In February last year, my team agreed with Audit Scotland that the audit of Ferguson Marine’s accounts for the year ending 31 March 2020 would be undertaken by an external auditor appointed by Ferguson Marine’s board of directors, rather than by the Auditor General. That is because there was insufficient time between the business entering public ownership on 2 December 2019 and its financial year end to allow the audit order process to complete with the necessary consultations.

The Auditor General and I are keen that Ferguson Marine falls within the scope of his audit oversight, which has always been the intention. If approved, the proposed legislation will enable the accounts of Ferguson Marine to be audited by an auditor who is appointed by the Auditor General. That will provide the Auditor General with greater oversight of the finances of the shipyard, and it will increase the transparency of progress that is being made in the business.

The proposed legislation will also bring Ferguson Marine in line with other Scottish public bodies that are under the scope of the Auditor General. It has been developed in consultation with Audit Scotland, and the Auditor General has welcomed the ability to appoint an external auditor to the organisation.

I hope that the committee will support the move to align Ferguson Marine with other Scottish public bodies, and allow the Auditor General to appoint its external auditor.

Members do not appear to have any questions on the order. Therefore, we move to the next item on the agenda, which is the formal debate on the motion to approve the affirmative instrument.

Motion moved,

That the Economy, Energy and Fair Work Committee recommends that the Companies Act 2006 (Scottish public sector companies to be audited by the Auditor General for Scotland) Order 2021 [draft] be approved.—[Fiona Hyslop]

As no member wishes to speak in the debate, I will put the question on the motion. The question is, that motion S5M-23994 be agreed to.

Motion agreed to.

In light of the timing, I invite the committee to agree to the clerks and me producing a short factual report of the committee’s decision and arranging to publish it.

As no member has indicated otherwise, that is agreed.