The Scottish Government no longer expects to have enough money to deliver all its planned £26 billion investment in public sector infrastructure. says spending watchdog Audit Scotland.
Growing the economy and delivering high quality public services relies on infrastructure like roads, railways, hospitals and other buildings. But a combination of reduced capital budgets, higher costs and increased maintenance requirements have left ministers with difficult decisions to make on prioritising capital spending. This includes stopping or pausing planned projects.
The Scottish Government’s investment plan focuses on driving inclusive economic growth, enabling the transition to net-zero emissions, and building resilient and sustainable places. But it is not always clear how the Scottish Government is directing funding to these three infrastructure investment priorities, or how they will contribute to reducing greenhouse gases.
Better data on the condition, occupancy and cost of the wider public estate is needed to ensure buildings are used more efficiently as part of Scottish Government plans to reform public services.
Stephen Boyle, Auditor General for Scotland, said: “Scottish Government spending decisions on infrastructure will affect public services, and ministers need to be transparent about how they are made.
“Efficient use of the public estate in the future is key to reforming public services, but the Scottish Government needs better infrastructure data to inform its planning.”
Longer-term joint planning is needed to address child poverty in Scotland, which has increased since targets were set in 2017, according to a new Audit Scotland report.
The Scottish Government’s policies and spending remain more focused on helping children out of poverty rather than long-term measures to prevent it. Over a quarter of children in Scotland – 260,000 – were living in poverty before the Covid-19 pandemic. And the current cost-of-living crisis risks making the situation worse.
Covid-19’s impact on data collection means child poverty statistics are only available up to 2019/20, the half-way point in the Scottish Government’s first child poverty plan. But even with the data it would not be possible to assess the plan’s success. This is because the Scottish Government did not set out what impact the 2018-22 plan was expected to have on levels of child poverty.
The government’s second child poverty delivery plan takes a more joined-up approach to tackling child poverty, spanning central and local government and their partners. But detailed joint planning is now needed to ensure policy actions are delivered and progress measured. Policy development also needs to meaningfully involve the views of children and families with experience of poverty.
Stephen Boyle, Auditor General for Scotland, said:“Poverty affects every aspect of a child’s wellbeing and life chances and has wider implications for society.
“The Scottish Government needs to work with its partners to quickly set out the detail of how the second child poverty plan will be delivered, monitored and evaluated.
“Government policy takes time to have an impact on child poverty and so it is essential ministers also act now to set out options for reaching their long-term targets in 2030.”
William Moyes, Chair of the Accounts Commission, said:“Councils have a key role to play in tackling child poverty through measures such as housing, education, childcare and employability. But there is limited information available across councils about what they are doing and its impact.
“Better collection and sharing of information about councils’ child poverty work will help support learning and improvement across Scotland.”
A detailed analysis of how Covid-19 business support funding was distributed during the pandemic is not possible due to gaps in data, according to spending watchdog Audit Scotland.
The Scottish Government provided about £4.4 billion of grants and non-domestic rate reliefs between March 2020 and October 2021, mostly paid out to businesses by councils. The government announced a further £375 million of support in December 2021 following the emergence of the Omicron variant.
Steps were taken to improve the management of funding during the pandemic.
But there was not enough focus on gathering detailed data on how money was distributed and how quickly applicants received funding.
This means:
The Scottish Government does not have an analysis of the total amounts paid out from the more general schemes to different economic sectors
For sector specific funding administered by national organisations such as Scottish Enterprise, around 20 per cent of payments cannot currently be matched to council areas
Similarly, information to enable wider analysis of how funding supported specific groups, such as the female owned businesses disproportionately hit by Covid-19, is not available from Scottish Government centrally held data.
In late 2021, the Scottish Government completed retrospective impact assessments to consider how business support funding addressed inequalities. A retrospective fraud review of funding that councils administered was also carried out.
The government is currently undertaking a large data cleansing exercise to ensure that the datasets for individual funds, including those administered by councils, are complete.
Covid-19 business support schemes were administered at pace in exceptional circumstances.
But knowing where the money went matters, to get future policy development and delivery right.
Stephen Boyle, Auditor General for Scotland, said: “These business support schemes were administered at pace in exceptional circumstances. But knowing where the money went matters.
“To get future policy development and delivery right, it will be important for the Scottish Government to fully understand how funding was used to support specific businesses and groups over the last two years of the pandemic.”
William Moyes, Chair of the Accounts Commission, said: “Councils’ fraud arrangements are generally robust, but they were heavily relied upon to ensure businesses were eligible for funding during the pandemic.
“Councils will need to continue to work closely with the Scottish Government to ensure a better picture emerges of how money was distributed.”
Responding to the Audit Scotland report, Economy Secretary Kate Forbes said: “I am pleased that both Audit Scotland and the Accounts Commission have recognised how quickly the Scottish Government was able to establish a wide ranging business support package in order to help safeguard thousands of businesses and jobs.
“This includes providing direct support to over 4,000 businesses and over 5,000 self-employed people who were facing hardship but ineligible for UK Government funding support.
“I am equally pleased this report reflects the unique and challenging context in which new support packages had to be established, and that despite the speed and scale of our response, we were able to work closely with industry, our enterprise agencies and local authorities.
“This helped to ensure the delivery of the business support funding was a shared endeavour and minimised risk and fraud. Without the efforts of our partners, we wouldn’t have been able to deliver this lifeline support at the scale and pace necessary and I thank them for working so closely with us.
“Every decision the Scottish Government has taken has centred around ensuring businesses got the support they needed when they needed it – resulting in over £4.5 billion being allocated to businesses across the country, including around £1.6 billion in rates relief – which is more generous than the other UK administrations so far.
“We will now carefully consider the findings of this report and of course any lessons will be learned, but fundamentally this report shows the decisions we took ensured lifeline support reached key businesses promptly and our economy continued to grow by 7.1% despite the necessary public health restrictions.”
Progress on closing the poverty-related attainment gap between the most and least deprived school pupils has been limited. And more evidence is needed to understand educational achievement beyond exams.
A joint report by the Auditor General for Scotland and the Accounts Commission found that exam performance and other attainment measures at the national level have improved.
However, progress since 2013-14 has been inconsistent. And there are large variations in local authority performance, with some councils’ performance getting worse on some measures.
The poverty-related attainment gap remains wide and existing inequalities have been exacerbated by the Covid-19 pandemic. The national curriculum recognises that school is about more than exams.
And there has been an increase in the types of pathways, awards and qualifications available to young people. But better data is needed to understand if other important broad outcomes, like wellbeing and self-confidence, are improving.
The Scottish Government, councils, schools and the other bodies responsible for planning and delivering education were working well together before Covid-19.
That allowed them to respond rapidly in exceptionally difficult circumstances. Funding for education has remained largely static – rising from £4.1 billion in 2013/14 to £4.3 billion in 2018/19.
However, most of that real-terms increase was due to the Attainment Scotland Fund, which the Scottish Government set up to close the attainment gap.
Stephen Boyle, Auditor General for Scotland, said: “Significantly reducing the attainment gap is complex. But the pace of improvement has to increase as part of the Scottish Government’s Covid-19 recovery planning.
“That process needs to particularly focus on the pandemic’s impact on the most disadvantaged children and young people.”
Elma Murray, Interim Chair of the Accounts Commission, said: “There is variation in educational performance across Scotland, but this is not solely about exam performance.
“Education also supports and improves the health and wellbeing of children and young people, which has been impacted by the Covid-19 pandemic.
“It is vital that councils, schools and their partners work to reduce the wide variation in outcomes as well as understanding and tackling the short and longer-term impact of Covid-19 on learning and wellbeing.”
EIS General Secretary Larry Flanagan said: “The impact of poverty on children’s life chances remains a matter of huge concern, and much more needs to be done to support young people living in poverty to overcome the barriers that they continue to face.
“Schools do all that they can with insufficient resources to support young people from all backgrounds but cannot, in isolation, overcome such serious societal issues as inequality and poverty.”
“We have long known of the devastating impact that poverty can have on young people, and this has been made worse during the pandemic when young people from less affluent backgrounds have been far more likely to have had their in-school learning disrupted and to face barriers in accessing education outwith the school environment.”
“It is clear that much greater and sustained investment is needed to tackle the impact of poverty on young people’s education, and all of Scotland’s political parties must fully commit to tackling this issue in the context of education recovery during the next Parliament.”
