Scottish Government

SB(09)6th Conclusions

MEETING OF THE SCOTTISH GOVERNMENT STRATEGIC BOARD: HELD ON THURSDAY, 18 JUNE 2009

Present

Sir John Elvidge KCB (chair)
Robert Gordon CB
Andrew Goudie
Stella Manzie CBE
Andrew Scott
Alyson Stafford
Richard Wakeford
Kevin Woods
David Fisher
Bill Bound
Heather Logan

In Attendance

Angiolina Foster
Sarah Davidson
Elinor Mitchell
Katie Wood
Fiona Watt
Norman McFadyen
Nicola Richards
Kenneth Hogg (Agenda Item 3 only)
James Hynd (Agenda Item 3 only)
Ian Walford (Agenda Item 3 only)
Frances Wood (Agenda Item 3 only)
Leslie Evans (Agenda Item 4 only)
Vicky Carlin (Agenda Item 4 only)
Ken Thomson (Agenda Item 5 only)
Jan Marshall (Agenda Item 5 only)
Ian Turner (Agenda Item 5 only)
Lesley Doherty (Agenda Item 6 only)
Alistair Brown (Agenda Items 6 and 7 only)
Scott Mackay (Agenda Item 7 only)
Andrew Watson (Agenda Item 7 only)

The Permanent Secretary welcomed the Scottish Government officials who joined the meeting to observe the proceedings.

Agenda Item 1: Minutes and Matters Arising

1. The Strategic Board agreed the minutes of the meeting held on 21 May 2009 (SB(09)5th Conclusions).

2. Richard Wakeford said that the Climate Change Delivery Plan had been published on 17 June. The Permanent Secretary said that this had been a significant achievement.

3. Alyson Stafford said the provisional outturn for 2008-09 indicated an underspend of £31m, which represented a margin of 0.1% from the Scottish Departmental Expenditure Limit budget of £28 billion. The Cabinet Secretary for Finance and Sustainable Growth would make a statement to Parliament, outlining the outturn position, the following week. The Permanent Secretary said that such a margin was a tremendous achievement and thanked the Director of Finance and those involved in achieving such an extremely demanding standard.

Agenda Item 2: Update on the Economy (oral item)

4. Andrew Goudie introduced this item which was the regular monthly update to the Strategic Board on the economy. He circulated slides (SB(09)6th Meeting - Presentation - Agenda Item 2 - Current State of the Scottish Economy). Dr Goudie said that some recent survey evidence was being interpreted by some as the early signs of economic recovery and cause for a degree of optimism. For example, the UK industrial production figures showed a slight rise in manufacturing output. This rise might be explained by the required re-stocking by companies which had been intentionally de-stocking. It was important to bear in mind that the survey evidence did not represent hard data and that others, including the Governor of the Bank of England, were of the view that the recession continued to deepen, although the rate of decline was slowing.

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

5. Dr Goudie said that the labour market data released on 17 June showed a significant acceleration in the last quarter of those becoming unemployed and actively seeking employment, the number having risen by over 41,000 during that period. The number claiming Jobseeker's Allowance over the same period had not increased by the same degree suggesting that those losing jobs were not claiming benefits.

6. The refreshed Economic Recovery Programme (ERP) had been published on 15 June. Dr Goudie said that the structure and content of the ERP now focused on three themes: supporting jobs and communities; strengthening education and skills; and investing in innovation and the industries of the future. The refreshed ERP illustrated the types of expenditure that supported the economy and was more clearly and explicitly part of long term aim of achieving the Government's Purpose than the original Plan. Dr Goudie thanked those across the organisation for their co-operation in the production of the refreshed ERP.

7. Points made in discussion:

(a) It would be important to monitor and evaluate the measures and steps being taken towards economic recovery. This was already taking place, to some degree, across the organisation;

(b) There was a difference between the allocation of funds and the spend of such funds. It would be important to report on actual spend and to evaluate the success of outcomes achieved;

(c) The recent data on rising unemployment figures could lead to a reduction in consumer confidence and consumption;

(d) It would be important to learn from previous experiences as regards those dispossessed during economic downturns and investment in the social economy though the third sector might help in this regard;

(e) While the depreciation in the value of Sterling should help businesses seeking to export goods, the benefit would be dependent on the relative growth rates in countries to which those businesses exported; and

(f) Scenario planning had begun in relation to possible high levels of workforce absence as a result of Influenza AH1N1 and the resultant impact on the ERP;

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

Agenda Item 3: Resilience and Business Continuity: Update on Influenza A(H1N1) situation (SB(09)31- Revised)

8. Kenneth Hogg introduced the new version of paper SB(09)31(rev) tabled at the meeting, explaining that this version contained information in the annexes which had been produced by the Scientific Advisory Group on Emergencies the previous day. Unusually, this pandemic was affecting younger members of the population; those of working age and, in particular, children. Emerging trends suggested that, if 25% of the population were to fall victim to Influenza A(H1N1), up to 35% of Scotland's workforce could be absent from work, either with Influenza or due to caring responsibilities. UK cases were now on a trajectory closely resembling that of Mexico. The outbreak was coming faster than predicted, with no sign of any decline in the numbers of cases. The expectation for future months was that this heightened pace would intensify.

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

9. James Hynd said that guidance had been issued to Directorates asking them to work up their continuity plans based on an assumption of 25 - 50% of the workforce affected model. The quality and robustness of the returns was being monitored. Briefing and FAQ information would be provided shortly and the planning around corporate services, for instance such as IT, would need to be robust enough to allow the organisation to deal with pressures and their likely impact on internal service delivery.

10. Points made in discussion:

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

(a) Officials had been working at a heightened pace within Scottish Government Resilience Room (SGoRR) on a shift system to the end of May. A Pandemic Flu Division had now been established. It seemed likely that: any affected Directorates would find themselves stretched in terms of workloads; Communications colleagues would continue to be stretched; and parliamentary and media engagement for Ministers would increase;

(b) It would be important to keep Ministers fully informed of the developing situation, including the staffing required to deal with the pandemic;

(c) Business continuity plans were critically important, allowing affected Directorates to react and deal with issues as they occurred potentially with little or no notice; and

(d) Gratitude was due to all the volunteers who had been, and would continue to be, required in large numbers, including those who had volunteered to work in the SGoRR.

11. The Strategic Board agreed:

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

(a) Directors General should ensure that all Directorates urgently completed any remaining pandemic flu planning activity for their sectors, working closely with stakeholders and being mindful of developing epidemiology and absence modelling; (Action: Directors General)

(b) Directors General should ensure all Directorates consider whether they may need to respond in the very short term, regardless of whether a full pandemic developed later in the year; (Action: Directors General)

(c) Directors General should ensure all Directorates gave urgent priority to updating and submitting their internal business continuity plans, given the potential large numbers of staff absences in the weeks ahead; (Action: Directors General)

(d) Further work should be done to ensure that all employers were aware of the guidance on sickness absence; (Action: Scottish Resilience and Communications Directorate) and

[Alyson Stafford left the meeting]

Agenda Item 4: Delivering National Outcome 13 "We take pride in a strong, fair and inclusive National Identity" (SB(09)32)

12. Andrew Goudie introduced paper SB(09)32. He said that there was a clear link between national outcomes and the Purpose and it was important to be in a position to monitor progress. This paper was an initial attempt to draw out the learning points; uncovered and sought the Strategic Board's comments on the approach taken to champion and drive the delivery of national outcome 13 and on the proposals for managing Scotland's international and domestic reputation and identity through the refresh of the Scotland brand.

13. Leslie Evans said that, although it had been difficult to identify which data sources should be used to base evidence, good progress on this national outcome had been made. There was an increased understanding of the outcome, which was reflected in the Single Outcome Agreements. Strategic alignment was required not only across the Government but more widely across the public sector landscape; and there was a complex set of interactions to be considered in this area.

14. Points made in discussion:

(a) Good progress had been made on this outcome and experience was allowing better evaluation of progress;

(b) There were a large number of interventions which could be made which would make a difference. It would be important to identify and act on those which would have the biggest impact;

(c) All Directorates should be engaged in the pursuit of this outcome; an evaluation of what each one was contributing would be useful;

(d) It would be important to raise Scotland's economic reputation amongst young people in other countries because this might promote economic migration;

(e) The focus on tourism and the reputational side of science and innovation was probably right;

(f) Progress was being made on understanding key drivers and indicators. It would be important to create opportunities to ensure that everyone had a common understanding of the goal.

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

15. The Strategic Board agreed:

(a) That an update on this outcome should be provided at the October Board meeting; (Action: Culture External Affairs and Tourism Directorate and Cabinet and Corporate Business Secretariat) and

(b) Reports on progress against each of the other national outcomes should be considered by the Board. (Action: Director of Strategy and Performance Directorate and Cabinet and Corporate Business Secretariat)

[Alyson Stafford rejoined the meeting and Andrew Goudie left the meeting]

Agenda Item 6: Remuneration Group Annual Report (SB(09)34)

16. David Fisher, Chair of the Scottish Government Remuneration Group (RG), introduced the annual report on RG's work in 2008-09 (SB(09)34). He said that it had been a very successful year, with generally positive feedback from stakeholders. RG was now increasingly being seen as working in partnership with organisations and the relationships between Finance Pay Policy (FPP) and NDPBs were now much more positive. This provided a sound basis for working through what were likely to be difficult years ahead. More pay remits had been dealt with at official level, and remits referred to the Scottish Government had been handled with greater speed than in previous years. There had been a number of ideas for improvements through the year; one of these being an annual meeting of the Chairs of the Scottish Government Audit Committee and RG, which had now been agreed. Mr Fisher said officials from FPP had done an excellent job.

17. Points made in discussion:

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

(a) The Parliamentary Finance Committee report would be published on 22 June;

(b) Seminars on pay policy and the development of pay remits had been held for sponsor bodies and sponsor teams. These had helped bodies and sponsor teams understand their respective roles in developing and scrutinising pay remits; and

(c) It was very resource intensive for small organisations to produce their own pay remits; further consideration was being should be given to rationalising this.

18. The Strategic Board agreed:

(a) In terms of scrutinising pay remits, sponsor teams had the best background knowledge of the organisation and were likely to be aware of key issues and concerns but FPP had the expertise in both pay policy and in the scrutiny function itself. It was therefore likely that a joint approach to scrutinising pay remits with respect to alignment with pay policy would continue, although a move towards more being done by sponsor teams would be desirable in the medium term; and

(b) To convey appreciation to FPP staff for their efforts and the progress made.

[The Observers left the meeting]

Agenda Item 7: Budgets: 2009-10 Budget Strategy Update (SB(09)35); 2010-11 Budget; and Administration Budget 2010-11 (SB(09)36)

2009-10 Budget Strategy Update (SB(09)35)

19. Alyson Stafford introduced paper SB(09)35 which provided an update on the strategy for achieving budget balance for 2009-10 in advance of the first financial monitoring report for 2009-10 due to come to the Board's next meeting in July.

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted

2010-11 Budget

20. Stella Manzie introduced this item which updated the Board on the position regarding the budget for 2010-11. She said that the intention remained to publish the draft budget in September.

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

[Kevin Woods left the meeting]

Administration Budget 2010-11 (SB(09)36)

21. Stella Manzie introduced the paper which set out the implications for the 2010-11 Administration Budget.

Part of the record of discussion under this agenda item is considered exempt from publication at this time and has been redacted.

Agenda Item 8: Any Other Business

22. The Calman Commission published its final report on 15 June and work on the Government's responses was in hand. This was to be viewed as an opportunity and it was not necessary to add this to the Board's Risk Register.

23. The Board would prefer sight of the Strategic Board action tracker rather than receiving an exception report. (Action: Cabinet and Corporate Business Secretariat)

Date of Next Meeting

24. Thursday, 16 July at 9.00am.

Cabinet and Corporate Business Secretariat
July 2009