Scottish civil servants who write bills should receive “enhanced training”, a Holyrood committee has said.
The Scottish parliament’s Finance and Public Administration Committee has regularly raised concerns about the Scottish government’s costings for projects such as the planned National Care Service.
In a letter sent to parliamentary business minister Jamie Hepburn this week, the committee’s convenor Kenny Gibson, an SNP MSP, said FPAC had “repeatedly identified issues with the quality of information” presented in financial memorandums, “as well as a general lack of consistency in how that information is presented”.
Financial memorandums accompany bills introduced by the Scottish parliament. They should set out best estimates of the costs, savings, and changes to revenues arising from a bill, including the margins of uncertainty for these estimates. They should also outline the estimated financial implications of the bill, and when they will arise for the Scottish Government, local authorities and other bodies, individuals and businesses.
But the finance committee said its concerns over the use of memorandums include: a lack of costings for all provisions in a bill; the identification of potential implications of proposals, without actual estimates of costs; and the provision of unrealistic costs and savings.
It said other issues include: a lack of sufficient consultation with stakeholders around accuracy of costings; the use of lower projections in costings, despite both lower and higher projections being available; and costings not taking into account the impact of inflation.
The committee said all of the above issues are covered by the guidance in the Scottish Public Finance Manual, which includes an annexe questionnaire for completion by bill teams in the preparation of financial memoranda.
“We therefore urge the Scottish Government to put in place enhanced training and development for bill teams to improve the quality and consistency of presentation of future FMs,” the letter said.
“This learning should include promoting the importance of applying each of the steps in the SPFM guidance when preparing FMs. As well as setting out how the Scottish Government intends to implement these measures, we seek details of how it will monitor the outcome of this work to determine any improvement in the quality and consistency of presentation of FMs.”
For the National Care Service, the Scottish Government initially estimated introducing the care service would cost between £644m and £1.26bn over a five-year period. This has since increased to between £880m and £2.2bn, spread over more than a decade.
FPAC said the government’s initial financial memorandum for the bill failed to include information on the potential financial impact of inflation and estimated costs associated with IT projects, the transfer of local government staff, assets and liabilities, procurement, double-running, and VAT liability.
A Scottish Government spokesperson said: “Ministers are required by the parliament’s standing orders to set out estimates of the costs, savings and changes to revenues that would be brought about by any bill they introduce. The Scottish Government will respond to the specific issues raised by the Finance and Public Administration Committee in its correspondence in due course.”