Chamber and committees

Capital projects, by nature, are often managed over a number of financial years and as such the Scottish Government recognises that there will, on occasions, be minor and marginal movements to timescales caused by, for example, weather or planning delays, with a subsequent impact on the expenditure profile of the project. This requires a flexible approach to managing capital budgets over time. In respect of financial year 2011-12, the following projects experienced marginal movements in timescales – the Forth Replacement Crossing, the Victoria and Albert Waterfront project, the Port Edgar project, the Stromness Harbour extension project. Accordingly, appropriate budget will be reassigned to these projects in 2012-13 through the Budget Exchange Mechanism.

The Scottish Government is required to manage its Departmental Expenditure Limit (DEL) cash and non-cash budget within the framework of the Consolidated Budgeting Guidance published by HM Treasury on an annual basis. The figures in the following table are provided on the basis of the rules in place for the respective years and reflect the provisional outturn underspends announced to the Parliament. Financial year 2011-12 was the first year of the Devolved Administrations Budget Exchange Mechanism with the scope for a planned carry forward to 2012-13.

Provisional HM Treasury DEL Underspend by Cash/ Non Cash – 2007-08 to 2011-12

Notes:

1. The Budget Exchange Mechanism is effective from 2011-12 for the period of the current Spending Review.

2. Under HM Treasury Consolidated Budgeting rules, non-cash was monitored separately from 2008-09 onwards.

The Scottish Government is required to manage its DEL cash and non-cash budget within the framework of the Consolidated Budgeting Guidance published by HM Treasury on an annual basis. Accordingly, the Scottish Government monitors performance against budgets authorised by the Scottish Parliament and HM Treasury limits. Budget Exchange arrangements for the Devolved Administrations has replaced End Year Flexibility and will operate across the UK 2010 Comprehensive Spending Review period. This provides a facility to plan budget carry-forward within agreed limits. The Devolved Administrations Budget Exchange Mechanism allows the Scottish Government to carry forward any underspends from one financial year to the next up to a limit which is calculated as a percentage of the DEL budget.

The Accountant in Bankruptcy publishes the official personal insolvency statistics for Scotland on a quarterly basis on its website (see www.aib.gov.uk).

Personal insolvency statistics consist of both bankruptcy and Protected Trust Deed figures. The most recent quarterly statistics, corresponding to the first quarter of financial year 2012-13 (equivalently, the 2nd quarter of 2012), were published on the 25 July 2012 (see www.aib.gov.uk/scottish-insolvency-statistics-quarter-1-2012-13).

These statistics showed that there were 5,601 personal insolvencies in this quarter, consisting of 3,310 bankruptcies and 2,291 Protected Trust Deeds. This figure represented a 15 per cent increase in personal insolvencies on the previous quarter, and a 5 per cent increase compared to the same period of the previous year.

The next set of quarterly insolvency statistics, corresponding to the second quarter of financial year 2012-13 (equivalently the third quarter of 2012), are due to be published in October 2012.

Liquidation may be voluntary, by resolution of the company’s members or creditors, or compulsory, by order of the courts. Not all liquidations are insolvencies: a voluntary liquidation may be the formal closure of a solvent business which the company’s members no longer wish to continue, a compulsory liquidation of a solvent business may sometimes be in the public interest.

The Accountant in Bankruptcy records statistics on compulsory liquidations and creditors’ voluntary liquidations. A third type of liquidation exists, called members’ voluntary liquidation, however this is not technically insolvency as the directors of the company swear a declaration of solvency to say that the company will be able to pay all its debts within a period not exceeding twelve months. Accordingly members' voluntary liquidations, although recorded by the Accountant in Bankruptcy, are counted separately to the statistics on corporate insolvency (corporate insolvency statistics consist of receiverships, compulsory liquidations and creditors' voluntary liquidations).

The most recent quarterly statistics, corresponding to the first quarter of financial year 2012-13 (equivalently, the 2nd quarter of 2012), were published on 25 July 2012 (see www.aib.gov.uk/scottish-insolvency-statistics-quarter-1-2012-13). These statistics showed that there were 468 liquidations in this quarter, consisting of 348 compulsory liquidations, 62 creditors’ voluntary liquidations, and 58 members’ voluntary liquidations: this represented an increase of 11 per cent compared to the previous quarter, and an increase of 16 per cent compared to the same period of the previous year.

The next set of quarterly insolvency statistics, corresponding to the second quarter of financial year 2012-13 (equivalently the third quarter of 2012), are due to be published in October 2012.