Finance and Public Administration Committee [Draft]

Meeting date: Tuesday, June 24, 2025

Official Report 748KB pdf

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Public Administration in the Scottish Government

Good morning, and welcome to the 22nd meeting in 2025 of the Finance and Public Administration Committee. We have received apologies from Ross Greer, who is, once again, battling through amendments to the Housing (Scotland) Bill. However, he hopes to be with us fully once more post-recess.

Our first agenda item is an evidence session with Joe Griffin, the permanent secretary to the Scottish Government, on issues relating to public administration in the Government. Mr Griffin is joined by Scottish Government officials Lesley Fraser, director general corporate; Gregor Irwin, director general economy; and Richard McCallum, director of public spending. I welcome you all to the meeting, and I invite Mr Griffin to make a short opening statement. Good morning, Mr Griffin.

Good morning. Thank you very much for this early opportunity to engage with the committee to discuss my priorities and any matters of interest relating to public administration in Scotland. First, I thank my predecessor, JP Marks, for his leadership and service. I will continue his strong focus on delivery, developing our infrastructure and professional capability to advance the Government’s priorities and improve the lives of the people who live and work here.

With the appointment of a new cabinet secretary, this is a moment to focus on our people’s engagement and values. Our organisational vision refers to being in the service of Scotland by creating a civil service that is “dynamic, diverse and connected”. I have served in the Scottish Executive and then the Government for nearly 20 years, so it matters a lot to me that we realise that vision and that we are able to live up to the challenges before us and the expectations of our communities.

In my first few weeks in the post, I have been engaging with colleagues and meeting delivery partners around the country, all of whom are focused on achieving the Government’s four priorities: tackling child poverty, growing our economy, reaching net zero and improving public services. This outward focus is one of the best ways of being able to advise ministers, linking statistical and analytical evidence with lived experience and understanding the practical connections between and across areas that are otherwise potentially siloed. In addition, public confidence in governmental institutions depends on our ability to deliver real, visible results. That, too, comes with a strong connection to place. Scotland’s scale, agility and sense of shared purpose give us a great opportunity to base public policy on an understanding of place, and I am committed to using that to full effect.

I am very proud of my executive team, some of whom join me today to put their more detailed and expert capability at your disposal. We meet regularly as a team and with the Cabinet to drive delivery in line with the Government’s programme. Our ability to work across organisational boundaries is key, as is our collective leadership to build capability and ensure the high standards of governance, accountability, financial management and transparency.

As ministers set out last week, further reform is needed across our public sector. The public sector reform strategy sets out a clear vision for change towards a smaller and more agile public sector that delivers better value, eliminates duplication and develops deep digital capability to improve public services. The Scottish Government must be part of that, playing a leading role in reducing the size of the public sector and adopting the best of reform and digital capabilities to improve how we do things. How we lead change is crucial. It needs to be done with kindness and skill, taking people with us but also with the determination to do the right thing.

It is also important that we are taking a long-term view. Examples of that include recent publications that set out our analysis of future trends and the need to improve population health and tomorrow’s medium-term financial strategy and related delivery plan. We are reforming the national performance framework to serve as Scotland’s strategic road map and to sharpen up its utility to test priorities, guide investment and track policy progress.

The Scottish Government has an obligation to balance the budget, however challenging the external circumstances. As principal accountable officer, I will continue to strengthen our regime of medium-term planning, accountable officer assessments and providing good advice to ministers on options to live sustainably while driving economic and social value from the Scottish Government’s £60 billion budget.

Finally, I am committed to openness and transparency. We are continuing to sustain improved freedom of information performance, ensuring that Government business is conducted on Government systems with the new mobile messaging apps policy, providing clear performance reporting in our annual accounts and reviewing and improving transparency in our management of strategic commercial assets.

I hope that that gives the committee a sense of the purpose and vision that I have for the civil service, and I look forward to discussing our capabilities and commitment to effective public administration more fully.

Thank you for that very helpful opening statement—not that it really was helpful, because it has blown away a lot of the questions that I was going to ask. I have been scribbling down more questions as you have been speaking.

You touched on the size of the civil service, which is causing several concerns. The civil service has been described by some Opposition politicians and the media as “bloated”, and you said yourself in your statement that you want the public sector to be “smaller and more agile”. What do you feel would be the optimal size of the civil service in Scotland, and how long will it take to get there?

I do not have a figure for the optimal size. When launching the public service reform strategy last week, the Minister for Public Finance talked about making savings of £1 billion over the next five years by improving efficiency and reducing duplication across the public sector. The Scottish Government needs to be part of how we look at our workforce. Some of the increases in recent years have been driven by the adoption of new powers and responding to crises such as Covid. However, now that we are through some of those and we are in a more steady state with some of the additional responsibilities, I believe that we can make some reductions. We have already started on that journey; we are down some 5 per cent over the course of the past three years. I have no optimal size in mind, but that is the direction of travel.

You say that we can make some reductions and you said that we have reduced the size of the public sector by 5 per cent over three years, but, if there is an optimal size—surely there must be an optimal size—one would have thought that you would be looking to say what the optimal was for each department, and, if we have figures for those, there must be a way to reach a figure for the optimal size overall. It is a bit woolly to say that you do not really know. It is almost as though you are moving in the darkness. It does not inspire confidence that you do not know what target you are aiming for, does it?

Your question was about the optimal size of the public sector, and we are in a pretty dynamic environment. Given the way in which things have panned out over the past few years, I am not sure how you would reach a number to come up—

I am sorry to interrupt, but you have got to look at what you want to achieve first, and surely you then have to say the optimal number of people who would be needed to achieve that.

What I was saying was that what you are trying to achieve is a pretty dynamic proposition at the moment, because of the volatile environment that we are in. However, the direction of travel needs to be one of continued reduction. Apart from anything else, that relates to budgets. Ministers will set the budget for staffing and its position with the other priorities that they wish to pursue, and the money that goes more directly to public services is a consideration in that regard. However, there is not a sense of an optimal size.

I am open minded about targets. We have not set a target at this point, but if, in further discussions, including with ministers, it is said that they wish us to set a target, I have no particular opposition to that. It is just the case that we have not done that up to this point.

Ministers might wish to set a target, but surely that would be based on the advice that you and your colleagues would give them about what is deliverable. I use the word “optimal” because people do not just want to see a reduction in the number of people if that has an adverse impact on the delivery of services. People want to see what is perceived to be more efficient and more effective delivery of those services.

Yes, absolutely, and I share that aspiration. I am just sharing with you the challenge of reaching a number that you could stand by as an optimal number for the functions that we are required to carry out and in the light of the situation in which we are constantly having to respond to different challenges.

It does not necessarily have to be a figure such as 6,231, to pick a number out of thin air. Surely it could be a range. For example, if there are about 7,000 civil servants just now, would the optimal figure be 6,000 to 6,500, or would it be a smaller range than that? That is the sort of thing that I am looking at.

I am happy to take the matter away, and we can reflect on that. We have not done that up to this point, for the reasons that I have given, but we can have a discussion with ministers about whether they would want to do that. However, as I said, I can see some of the challenges that would be involved in trying to reach an optimal number, even if it were a range, as you suggest.

You were strategy and external affairs director prior to taking up your current post, and you will know a lot of your colleagues and the Government well, which is obviously why you are now in the post. Are you able to determine which departments are doing best, which—if any—are performing sub-optimally and, if so, how those will be improved?

A small technical point is that we do not have departments in the Scottish Government. One of my predecessors, John Elvidge, changed the operating model to dismantle that. I know the point that you are making, but I put that technicality on the record.

You can call them directorates if you want.

Yes, of course—it is just that there are many more of them. When it comes to comparing some of the data as regards directorates, there are a lot more of them.

That is something that I will look at in performance management, including in my line management of my director general colleagues here. I will be looking at their objectives and what specifically they are trying to achieve in support of ministers. That will almost certainly involve a point in relation to the workforce and the ability to live within the delegated budgets for the staffing that they have set out. That would be part of the line management relationship.

I have a sneaking suspicion that you will not want to mention any who are performing sub-optimally, but are there any who are performing exceptionally well that you can look to as a beacon for others?

There are strong aspects of performance in different places. You will forgive me, convener, but I am not going to single out people at this point.

I knew that it would be a struggle, but I thought that I would try my best.

There is a broader point about the performance framework—maybe we will come on to that a bit later. I would like to see the national performance framework in a place where it is clearer and is much more public about how we are getting on with the achievement of outcomes. That is the important thing that people need to know about.

That was probably going to be the last question that I asked you, so I am glad that you have touched on it. One of the concerns over the national performance framework is just how widely it is used within Government. There is a feeling among the committee that perhaps too much lip service is paid to it, and that it is not used as a working tool. Is that something that you want to change?

I feel two things about national performance framework. One is that we need to simplify the vision of what we are trying to achieve. It is a lovely vision at the moment, but I think that ministers are looking at whether we can make it more of a strategic prospectus with specificity and greater clarity.

The second point is that it should be used as a much more vibrant tool and indicator of our performance. I will give you an example of when we have used it. During my time in education, we noted that the statistics relating to early childhood development after Covid were deteriorating. That is a really important area of public policy, because that is the point at which children’s brains develop and we get an indication of their prospects as they get older.

When that data came out, we needed to respond to it. We pulled together a programme of measures that we could take to improve those statistics, and we gave it some prominence in the programme for government as a specific commitment that the Government had adopted.

That is the sort of thing that I would expect my teams to do—to be in touch with the trends of data and, when things are heading in the wrong direction, to assemble the evidence, mobilise stakeholders and get together a plan of action to turn that around.

One of the issues with the national performance framework is that, when the programme for government comes out, it does not seem to connect directly to it. That is one issue.

Another issue is that many organisations and the wider population do not really have much understanding of what the national performance framework is. It seems to bubble around in the background, but it is not as prominent as perhaps it was intended to be. Is that a fair comment?

What it did when it first came in was, and what it still does is, provide a reminder that the point of Government and public services is to achieve a range of outcomes. That is why we are here. There is a degree of administration and there is a degree of, dare I say it, bureaucracy, but fundamentally we are here to try to drive improved outcomes for people in the real world. That is where I want the programme for government to be. I want to give ministers the best possible advice on how they can make it more relevant, realising that it will sometimes be a challenge to cut through to the public on a range of matters.

The public deserve to know about the Government’s performance, and anything that we can do to clarify that and to make it a vibrant document for us to use internally is where I would like to go.

We have seen in the indicators that the Scottish Government is progressing in some areas and staying still in some, but in others it is falling backwards. What is being done to address that?

I gave you a specific example on early childhood development. That is the kind of model that we have in mind. When it comes to elaboration of a programme for government, that was an instance in which we used the data.

The programme for government is informed by a sense of how the Government is progressing, and actions that are specifically designed to achieve such outcomes make their way into it. In recent years, we have got much better at tracking the delivery in order to be sure that we are on track to deliver the outputs that will then deliver the outcomes.

09:45  

Our approach probably varies when it comes to whether we sit down and systematically go through the national performance framework line by line, but the framework exists as an inspiration. In my experience, the Government and its policy teams are generally on top of the data that they handle and good at suggesting a direction of travel. The public, the Parliament and the Government all using the same reference point in the national performance framework would clearly be a virtuous place to get to.

There appears to be considerable resistance from some civil servants to what the public would perceive to be a fairly modest proposal, which is that they come into the office at least two days a week, and many are incredulous that they do not already do so. After all, public service workers, from refuse collectors to teachers to nurses, all have to be at their work.

Is your ultimate aim to increase the number of office days? What assessment has been done of the performance of people who work at home compared to that of those who work at the office? Also, what is the wider picture regarding people being able to collaborate and all the social interactions that come from people working collectively together in one place?

Quite early in my tenure, we collectively took the decision to implement the hybrid model, and I am absolutely certain that it was the right thing to do. To answer the last bit of your question first, we believe—there is evidence that suggests this—that people who work together in person are more likely to engage in high-value activities. There needs to be a purpose to being together, but, as I referenced in my remarks, innovating, being creative, building relationships and working across silos are much more achievable if people are working together in person for some of the time. It is about finding the right balance.

We are now going through a process to ensure that people will be together at least two days a week from October. Some people have reacted to that decision, and I understand some of the anxieties that they have. We absolutely need to ensure that we take account of diversity and inclusion requirements when considering how we carry out that change. However, the direction of travel is clear, for the reasons that I gave. First, let us secure the two-days-a-week policy and demonstrate its benefits. Speaking personally and collectively, we are interested in going further in due course—we have said that—but for now we want to secure the two days.

It seems very modest. Before Covid, people turning up to work in their office was taken as read. People might have had flexitime, which has been around for decades, but two days a week in the office generally seems a limited amount. I am glad that you will not stop there and will consider pushing further forward than that.

It is about finding the right balance. What has changed since Covid is partly that the technology is so much better. A conference call on the phone before Covid was often quite a painful experience. The technology now enables us to engage through a range of activities of a more transactional nature on a collaborative platform—it has pictures as well. However, it has its limitations; it is a good substitute, but it is a substitute. We are aiming to find the right balance and give effect to hybrid in the best sense of the word.

You will be aware that this committee has been carrying out an investigation into the cost-effectiveness of public inquiries, given their monumental costs and the many years that they seem to take. In the past week, we have seen demands for public inquiries into grooming and ferries from some Opposition politicians. No doubt, there will be plenty of others as we progress.

We will produce a report in the autumn, and there is an area that I want to ask you about. We have had compelling evidence that the current situation, whereby a specific budget can be severely impacted, is proving detrimental to services. The opportunity cost to the police or national health service of having a big chunk of its budget dedicated to an inquiry over a number of years means, quite frankly, that the people who would expect to benefit from those services are impacted, as the NHS and the police have made quite clear. Would you be sympathetic to the creation of a budget for public inquiries—regardless of what the inquiry is, how long it takes or what it costs—that is separate from the budgets of the organisations that are involved in the inquiries?

The committee is carrying out important work, and we look forward to seeing your findings. We, in the executive, as in the Government and the people who work for it, are in a particular position because we are often the subject of such inquiries. It can be difficult for us to look as though we are imposing any constraints on a chair’s room for manoeuvre. Currently, once a chair is appointed, the Government shares guidance and advice, but it is up to the chair to decide how to conduct an inquiry.

I understand your point on the circumstances that give rise to an inquiry. To answer your budget question as best I can, I will certainly look at your findings with an open mind. I am not sitting here saying, “Absolutely not,” but we would need to understand the context, reasoning, risk analysis and so on a bit more.

Ultimately, it is about public services.

Of course.

Some injustice might have happened five or 10 years ago, but that should not necessarily mean that people in my constituency cannot call on a police officer because a resource has been dedicated to an inquiry. There will always be a cost, even if you take it out of the central budget—it means that it cannot be spent anywhere else—but there seems to be a particular unfairness there.

In your introduction, you talked about using place to full effect, which I found intriguing. Can you expand a wee bit on what you meant by that?

We have an advantage in this jurisdiction. Scotland is a large, complicated country in some ways, but the number of people and administrative units—we have 32 local authorities and so on—is manageable.

What I mean by the importance of place is that, first, it is possible to build up a national picture, which is the aggregate picture of the local pictures, if that makes sense. Instead of the Government asserting the national picture, we can really understand the sum total of the local pictures based on data and insight. The second advantage is that having a good understanding of some of the specific circumstances of specific places enables you to adapt and change delivery or the formulation of public policy on that basis. The third is a relational point in that it is possible to get people in a room or hold bilateral discussions with system leaders in order to understand the points that are being made about a particular area’s specificity or why a data set is the way that it is.

We have taken some steps in the Scottish Government civil service to respond to that. For a number of years, we have had a system of place directors whereby a director is assigned to each community planning partnership, which is contiguous with a local authority area. That colleague sits around the community planning partnership table to provide insight from central Government and report back on the discussions. They also act as a little bit of an ambassador and, sometimes, a problem solver when it comes to how things are playing out in relation to public policy. The ability to be connected in both ways is a tremendous advantage for us.

That is what I mean when I talk about using place, and I am keen for my colleagues to be mobile and out and about so that it can happen in a really effective way. In my early days and previous roles, I tried to role model such an approach. The Scottish Government has the ability to make the most of having a good understanding of place.

On the place point, are you looking to declutter the landscape? There used to be a couple of hundred public bodies, whereas now you are responsible for about 125 or 130 non-departmental public bodies, and there are also local authorities, health boards, integration joint boards, community planning partnerships and city and regional deals. I wonder how many people in Scotland know how all those things work together.

Given that Scotland has a population of 5.4 million across 75,000km², is there an argument to include that landscape in the reform agenda? Most people want a major decluttering of the public sector landscape to ensure that more money is spent on front-line public services.

The Minister for Public Finance talked a bit about that last week when he launched the public service reform strategy, highlighting the need to look at the number of public bodies and, indeed, the structure and number of Scottish Government directorates. There is no specific blueprint for that at this stage, but quite a lot on the direction of travel, including the reasons for it, is set out in the strategy. Programmes of reform are under way; the strategy reflects a coherent vision of how various things hang together across different aspects; and, at this point, it feels like there is a direction of travel.

The Government is taking forward specific things such as the merger of a couple of health boards, which was announced last week, and discussions are on-going about having single authorities in some areas. That is the current direction of travel, but, as yet, there is no specific blueprint for how we will implement such changes.

I remember calling for a change more than 10 years ago, and we are still dipping our toes in the water.

You have talked about vision and about being dynamic, and the pace of change is important. I should say—and I have used this analogy before—that, when I was at university, I never once handed an essay in late; however, I never did the essay until the night before, because I had a deadline to work to. I always feel that, if there is no deadline, you will just do something else. I am one of those people who are very goal and task driven and who like to have something done by a certain date, so that they can move on to the next thing.

There seems to be a lot of passion and energy in what you are saying, but I like things to be pinned down whenever possible, so that everyone knows in what direction they are heading. Will there be—to use a United Kingdom phrase of the past year—milestones along the way?

Temperamentally, I have a lot of sympathy with that perspective. One of the big programmes that I helped to lead—the expansion of early learning and childcare—was greatly assisted by having a timescale. In the end, Covid delayed full implementation by a year, but we were on track, which helped to focus minds.

A number of workstreams in the strategy, which is a very broad-ranging document, are well under way. On the whole, we need to understand what the delivery vehicle will look like. At the end of last week, shortly after the strategy was published, I wrote to my successor as director general strategy and external affairs to make that very point and to ask her to make a statement on what our delivery vehicle will be by—I think, because this is from memory—the end of July. We must have full sight of all the 18 different workstreams as they progress. Some programme governance arrangements for the projects in question are already quite well developed and mature, but some are relatively new, so we need to put the vehicle in place.

We have all seen ministers stand up in the chamber and say that they will bring out a certain plan, strategy, document, refresh or whatever it happens to be—you name it—in the spring. We then find ourselves in the summer and it has not happened. Such documents never seem to come out, say, a week early; indeed, they are very rarely on time.

From experience, I expect there to be more battening down of the hatches. Ministers are ultimately held to account, but there appears to be a sense of drift across the whole Parliament when that does not happen, which does not help anybody. I just wonder whether there will be a bit more emphasis on ensuring that, when a deadline is set, it is met. After all, it would inspire a lot more confidence not only in the Government but in the Parliament and its institutions.

Again, I have a lot of sympathy with that, and I have followed your previous hearings, at which similar points have been made. Sometimes, there are very good reasons for a delay. For example, the reason for the medium-term financial strategy coming out tomorrow was to allow time for the UK spending review to take place. It would have been very difficult to publish our strategy ahead of that.

I am sorry, but there is never any shortage of excuses. The bottom line is this: if a deadline is given, surely one would expect it to be met on occasion—say, seven or eight times out of 10. However, it does not seem to happen anywhere near that often. Saying that something will happen by a certain time only for it not to happen appears to be a cultural thing. We, on this committee, have seen that kind of drift occur in a number of areas. I do not have to recount them—I see Liz Smith and others nodding. It is all about changing the culture to ensure that when someone says that something will be done, it will be done.

I was going on to agree with you.

Right—okay. Sounds good.

10:00  

Over the past year, one of the things that my predecessor and I have done—together with others, including Gregor Irwin—is sharpen up our delivery discipline, with the creation of a delivery unit within the Government and regular routines through the delivery executive, which I chair weekly. The programme for government is supported by a dashboard that shows us whether we are on track and so on. I have referred to capability building, and there is also a playbook for how we ensure that delivery happens. However, more capability building needs to happen. So, at a headline level, I agree with you, convener.

The other thing that I would say, though, is that we need to show, not tell. I can agree with you temperamentally, but I and my colleagues need to demonstrate that.

Maybe there is too much optimism about when things can be delivered. If they cannot be delivered by a certain date, people should perhaps err on the side of caution instead of being overoptimistic. If you say that something is going to be delivered in May and it is delivered in April, people are happy; however, if you say that it is going to be delivered in March and it is delivered in April, they are unhappy. Perhaps there is an issue with optimism bias in that respect.

I know that colleagues are keen to come in, but I have one last question. You touched on the issue of spending in your statement, and you talked about it with regard to delivery discipline. There are still issues with that. Ensuring that we are not comparing apples with oranges across portfolios when the budget document comes out is an issue that has been raised with the finance secretary on a number of occasions, and a wee bit more work has to be done on that. Indeed, things that I have raised in previous years were still in the last document, so I want to emphasise that a wee bit.

We are in a situation in which we pass the budget and then, a week later, we get the spring revisions for the previous year. Often, the changes are quite significant, but there are also changes that are repeated year after year. As a committee, we argue with cabinet secretaries about the policy intention and the delivery intention. Are you working with ministers to ensure not only that spending budgets are aligned as tightly as possible, but that we do not have that groundhog day situation every year?

I do not totally follow your groundhog day point, convener.

Basically, what happens is that several hundred million pounds is moved from, say, the health and social care budget to the education budget. The same movements happen every year, but when we question the Government on it, it says, “Well, one thing is grounded in policy and the other is grounded in delivery.” It seems that, if we want the transparency that you talked about in your opening remarks, it is important that things are done as clearly as possible and that we do not have to go through the same process every year.

I will take that away with me. My director for the budget, Richard McCallum, is sitting on my right. Richard, do you want to add anything?

I have just one thing to add. We have received the committee’s report on the Scottish budget process just in the past few days, and it has been very helpful in setting out a number of the recommendations that the committee has referred to, including your point about in-year budget transfers, convener.

The Cabinet Secretary for Finance sent an initial response in the past couple of days and has committed to writing back to the committee with a fuller one. We will be working through all of the recommendations with a view to the budget coming up later this year, and I am sure that we will pick the issue up with the Cabinet Secretary for Finance and the committee and in some of that pre-budget work, too.

We will be speaking to the Cabinet Secretary for Finance specifically about the report once we get her response to it, so I am pleased that you have already taken a lot of that on board.

We will now move to questions from colleagues around the table.

Good morning, and thank you for joining us. Following up on public sector reform, what percentage of the 9,000-plus staff that you have are either managers or team leaders?

Lesley Fraser will keep me right with the exact figure, but I think that just under half of that number are line managers.

You will be aware that that is an extraordinarily high figure when we look at industry standards. What plans do you have to change that and by when?

That is a good question, and it is in line with my previous comments about deadlines and so on. Being relatively early in my tenure, I cannot give you a specific plan and a specific time. I can give you some assurance that the executive team has already discussed that a few times as we look at the size of the overall civil service, effectiveness and consistency, and the effective implementation of and leadership on change.

We are also considering the statistics on the number of people who are line managers and the number of people whom they, in turn, line manage, which is relatively small by industry standards. We will need to bring those things together at some point. I cannot give you a specific plan with timescales at this stage, but I hope that there is some reassurance that it is in play.

You alluded to the span of control, in effect. Do you know the rough ratio of that? Is it one to one?

I think that I am right in saying that 54 per cent of people who are line managers manage one or two people.

That is quite out of sync with what best industry standards are. I appreciate that you are new in post, but, going back to an earlier discussion that you had with the convener, I will always press for specific plans to be put in place along with the associated measures—otherwise, how will we know that they are successful? You can be sure that I look forward to bringing that up again when you next appear in front of us.

Let us move on to mobile messaging apps, which you referenced in your opening statement. How will you ensure that WhatsApp, Signal or other apps are not used for Government business by staff or by ministers themselves on their personal devices?

The formulation of the policy has been quite a long time in the making, since the Martins report and the aftermath of the Deputy First Minister’s statement. There have been good communications with ministers and officials, including a briefing for ministers that was received before the Cabinet meeting last week, and there might also have been one the week before. That has been very well communicated and well understood.

We have also used our intranet to be clear on what the policy is. As with any corporate policy, there is an expectation that it will be followed.

How will compliance be measured?

WhatsApp will be removed from corporate devices altogether, so that will not be an option. As with many other policies, we expect it to be adhered to, so we do not intend to put a specific enforcement or checking system in place.

Do you think that that is slightly optimistic, given that most people will have personal devices as well? If what you are describing is advisory, there is nothing to stop them using their personal devices to carry on transacting Government business.

I invite Lesley Fraser to come in on that.

We have been very clear with colleagues that that would be a disciplinary matter. We expect colleagues to follow our information management guidance and policy. WhatsApp and other such mobile messaging applications have now gone from Government devices. Government business needs to be done on Government devices for the benefits of security, traceability and accountability. That message is well understood by colleagues, and they are very keen to comply and work with the new arrangements.

As the permanent secretary said, we have been able to improve the technology that is available to civil servants. We now have access to Microsoft Teams, for example, which fulfils many of the same functions but is safe, secure, traceable, accountable and so on. If the circumstances that you describe were to arise, that would be managed as a disciplinary matter, in line with our normal disciplinary arrangements.

Many people use WhatsApp with the function set to auto-delete, so how would you ever know that they were using it? The process is that people should undertake to follow the policy, and you have said that, if they do not, it is a disciplinary matter, but how will you know whether they are deleting as they go?

The business of Government is recorded at all points. In order for it to be recorded, it needs to be on our devices and on our systems. For security reasons, for example, you cannot import material easily from elsewhere; you need to produce material on our systems.

We are doing all that we can to encourage and require our colleagues to follow the policies and processes that we have in place. We are also very clear that, under freedom of information legislation, if somebody needs to do Government business on a personal device—for example, because of a cyber incident or a problem with our systems—they need to date-stamp that work, record the fact and then arrange for that material to be brought on to the record.

The information remains Government business wherever it is done. We are absolutely clear that, except in very exceptional, business continuity circumstances, we anticipate that everybody will use Government devices and Government systems.

Okay. We will wait and see.

I want to ask about the Supreme Court judgment. Obviously, the civil service operates under its four key values, particularly integrity and honesty. I am flabbergasted that, 10 weeks after the Supreme Court judgment, you are not implementing the law. Why is that?

The Government is clear that we accept the ruling and we will take the action that is necessary to implement it.

We have been taking a range of actions already. On request from the Cabinet Secretary for Social Justice, I have convened a short-life working group, in which all areas will be represented, to take stock of the actions that we need to take, to make sure that there is a common understanding of where we are and to share any insights that we might be gleaning from the approaches of others, such as the UK Government and the Welsh Government. Those are the actions that we are taking while we wait for the end of the Equality and Human Rights Commission’s review of its statutory guidance. That consultation ends next Monday, and I think that I am right in saying that the EHRC will move to finalise that guidance. Once it is finalised, we will be able to take a further series of actions.

That is contrary to what Baroness Falkner says:

“We have been clear in our public messaging and in direct conversations with duty-bearers, including the Scottish Government, that they should not wait for our guidance but should be seeking to update their policies and practices in the light of the new understanding of the law”.

The EHRC is quite clear that you should not be doing that, and it has emphasised that fact. It is clear that the EHRC has stated that to you, so why are you not doing what it says you should be doing?

Our understanding of that letter is that we should take action, and we are taking action where we think that that is appropriate and possible, pending the finalisation of the EHRC’s guidance.

Even though—this is in the public domain—Baroness Falkner is saying that you “should not wait for” the EHRC’s guidance?

My point is that we are taking action but there is a range of different actions. I think that we will have to wait for the guidance before taking some of those actions, because we have to understand what the statutory regulator is proposing for how we deal with some of the complexities of the situation.

So, your action at the moment is talking about it. Why, then, has the Scottish Parliamentary Corporate Body unanimously agreed to act with haste to take account of the law? How was it able to do that, and to what extent is that linked to the fact that it bears personal liability if it does not do so?

Every public body has to take its own decision in the light of its understanding of its legal duties and based on the advice that it is getting. The Scottish Government is in a very similar position to the UK Government and the Welsh Government in our understanding that our responsibility is to wait for the guidance for the implementation of some actions. We are taking a series of actions now, so that, when the guidance is finalised—

What actions have you taken, beyond talking about taking action? I am not clear about that, because I have not seen any. The wording from every minister and cabinet secretary is to the effect that, “We’re not doing anything beyond talking”—that is from the short-life working group—and, “We’re waiting for the guidance.” Baroness Falkner is quite clear that you do not need to wait for that. Set out what specific actions you have already taken, beyond talking.

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I cannot give you specific actions right now, but the work that is involved in the group and the work that the teams that are represented on the group are undertaking is to prepare the ground so that, when we have an understanding of what results from the consultation by way of new guidance, we will understand the policies that are effective and be ready to implement those once the guidance is finalised.

I referred to the corporate body because its members bear personal liability. How much do you think that has affected their actions? Do you think that, if you bore personal liability, you might have acted as quickly as the corporate body?

I do not know about the thinking of the corporate body, and that is a hypothetical question about how I would act in a different situation. Our advice is that the correct and appropriate thing to do is to wait for the finalisation of the guidance.

Despite the risk that that incurs. You will be aware that Sex Matters has already sent a letter before action, dated 18 June, giving 14 days’ notice of legal action. I understand that it is in the public domain today that there is a further email to you from For Women Scotland in which it notes that, if you do not take action, it reserves the right to take further action. Therefore, that is two potential further legal cases, and, given the strength of the Supreme Court judgment, we can anticipate the way in which those would go, potentially with a significant loss of public money. I am staggered that you are not acting now and that you are saying that we need to wait, when Baroness Falkner has said so clearly that you should not wait for her guidance.

We are not waiting to take the actions that we believe that we can take. I have not seen the latest email, but, in respect of the other reported intended action, the advice remains that, nevertheless, we should wait for the statutory regulator to finalise its guidance—

You are in charge. Is this your advice? Who is giving that advice?

This is advice from the relevant officials who support me in these matters.

But you are accountable—you are the accountable officer—

Yes, that is right.

—so do you not think that you should maybe question that advice? You are being told that you should wait for advice, and now you have two concrete threats of legal action. Does that not worry you a wee bit?

As a matter of good practice and operation, I always probe, test and question the advice that I am given. I am assured that the advice that I have is the correct advice. As I said, we find ourselves in a very similar position to our colleagues in Westminster and Cardiff.

My firm advice to you would be to look afresh at that. Frankly, it is no justification, under law, for you to say, “Ah, well, that is what everybody else was doing.” The Supreme Court judgment was compellingly clear. There is the threat of two further potential legal actions and my firm advice to you, permanent secretary, would be to get on it, because, from a public sector point of view, you are, ultimately, the accountable officer who is responsible for ensuring that the Scottish Government upholds the law. Regardless of your view on the matter, I personally think that it is a very poor look that, 10 weeks after the judgment, we have not done anything about it.

Good morning. I want to open by touching on the shape, form and function of the civil service. Almost every chief executive I know or have known would, at any point in time, be able to give you an assessment—a snapshot—of the optimal workforce and say whether the number was too high or too low. Why can you not, as the Scottish Government, give us an indication of a figure today for what the optimal number of civil servants would be to discharge their duties?

It is for the same reason that I gave earlier: we operate in a dynamic and volatile environment. Over the past few years, we have seen things such as the war in Ukraine and the requirement to arrange a refugee scheme. It was very hard to predict where the Government needed to respond, and my colleagues conducted themselves superbly in organising that welcome and reception for Ukrainian refugees. It the nature of the operating environment. It is also a little bit about my being 10 weeks into the role, so I cannot give you a figure today for the optimal size of the Scottish Government civil service.

I assume that your predecessor left a work-in-progress file with a figure in it.

That was not part of my handover, Mr Hoy, no.

Okay, that is fine. Scotland has a larger public sector than the rest of the UK, and it is better paid than in the rest of the UK. Public sector workers in Scotland now earn, on average, £2,000 more than those in the private sector. Ten weeks in, what is your assessment of the sustainability of that position?

On the basis of the First Minister’s speech last Monday, the public service reform strategy that was announced last week and the medium-term financial strategy and delivery plan that will be published tomorrow, I think that you can take it that there is a direction of travel with regard to reducing some of those figures. There are different variables with regard to how you manage your budget sustainably, and one of the things that is absolutely in your gift is to ensure that you are as efficient and effective as you can be, because the other choices would involve wanting to maintain the levels of public service provision, for example. We have been given a clear direction of travel by ministers, and we need to go ahead and implement that now.

You would concede that, if you were to continue in the current direction of travel without significant reform of the public sector workforce, there would be less money for front-line public services in the future.

The Scottish Fiscal Commission has set out a number of analyses that draw that conclusion.

Shona Robison has said repeatedly that the decision to pay civil servants more and to have more of them is an “investment”—she used that word. Where has the return on that investment been? Where is the increased productivity in Scottish public services?

The methodology for measuring productivity in the public sector has always been difficult, although a range of things lend themselves to that. There are some key performance indicators in respect of hitting FOI targets, for example, where our performance is greatly improved, and in respect of answering parliamentary questions. In our operational functions, something like Social Security Scotland will have KPIs. Other things, such as the value added of a creative solution or an innovation, are harder to measure, but it is important to keep trying.

Again, I cite John Elvidge, one of my predecessors, who brought into the organisation the concept of public value and the idea that any asset in the public sector should be used dynamically to drive good outcomes and to realise value for the public. However, the art and science of specifically measuring productivity, other than through the more competitive and output-focused tasks, for which there is a methodology and KPIs, has proved, over the years, to be difficult.

As the convener alluded earlier, since devolution, the number of jobs in the public sector has grown by 19 per cent but there has been a 98 per cent increase in the civil service, and the headcount has increased by 40 per cent since 2019. Surely that cannot be down to additional devolved issues such as Social Security Scotland. Have you broken the numbers down to see where the real growth has taken place?

Broadly, the growth is the result of the addition of new responsibilities. Unless one of my colleagues has a breakdown to hand, I would be happy to write to you with one. We certainly have figures for Social Security Scotland and the associated directorate, which is one of the more significant functions that we brought in—

From memory, I think that it accounts for about a third of the increase, but there is still a very significant number beyond that. The Scottish Government has said that the contingent workforce is one area where it has made significant progress. How would you characterise the Scottish Government’s efforts in that respect?

We have been quite successful in bearing down on the number of contingent workers in the past few years. In March 2022, the headcount of contingent workers was 2,031, whereas the figure in March 2025 was 1,075, which is a significant reduction in contingent workers.

I saw those figures, but I looked further back, which it is sometimes wise to do. In 2022-23, when the number peaked, probably because of the refugee crisis, social security and so on, the cost of contingent workers was £51.2 million. The last publicly quoted figure that I could find was £33.73 million. However, in 2019-20, it was £27 million. In effect, the cost is still £10 million more than it was in 2019, yet the Scottish Government is characterising that as a success.

Well, that number would be even higher had we not borne down on the number as I have described. Lesley Fraser may have more detail on that than I do.

The impact of inflation over the period will be quite significant for those numbers, Mr Hoy. The number of contingent workers that we are relying on in Government has been reduced by around 47 or 48 per cent.

Okay, but I think that the public will get a sense that, in a period when there has been wage constraint in the private sector, we have seen, particularly post-Covid, an increase in the pay gap between those working in the public and private sectors, which has grown to £2,000. The average full-time public sector worker in Scotland now earns £2,000 more than a worker in the private sector. The gap has grown from £400 to £2,000, so there has been a significant increase.

There is a sense that we have never had so many civil servants and they have never had it so good. I just looked on the Scottish Government’s website at the pay and benefits of being in the civil service. Salaries go from £25,000 at A3 up to £87,000 at C3. There is a 35-hour working week. There are 42 days of holidays after four years. There is a very generous pension scheme, with employers’ contributions starting at 28 per cent. There will potentially be a swimming pool at Victoria Quay. There is a compressed working week and an informal policy of working from home. It looks a rather attractive prospect. Where do you think efficiencies need to be made in relation to the form, function and operation of the civil service? It appears to be a pretty good deal.

I would agree that we are an attractive place to work. I want us to be an attractive place to work—I want to attract the best people to support ministers to serve communities across Scotland.

The direction of travel that ministers have set out for the public sector as a whole is to retrench and to become able to release savings. The Scottish Government has a leadership role, so we have to set an example in how we go about that, and we will do some of it by reducing our size. There are lots of different ways that we can do that, and some of them have been successful up to this point—there has been a 5 per cent reduction over the past three years.

Mr Griffin, that is about headcount. We have also found that there has been a significant increase in the number of top-grade civil servants—500 in the past three years. It is easy to say that your headcount is falling, but the wage bill is rising and the number of senior civil servants is rising significantly. For what reason is that number still rising?

I think that some of that figure—Lesley Fraser will correct me if I am wrong—arises from a technicality. At a certain point in April last year, we started counting people who were on temporary promotion in the civil service as well as those who were substantively in those positions. That makes that figure slightly inflated compared with the previous measure.

I understand your overall point. Civil service pay is reserved to Westminster, so those decisions are taken for the civil service as a whole.

However, when ministers have set us a direction of travel and the financial context is the one that you correctly describe, it is incumbent on us to look at all aspects of our operations. Issues such as the line manager position that I was discussing with Ms Thomson and your point about the senior civil service need to be in play. Last week, Mr McKee referred to—and this is in the public service reform strategy—the need to look at the number and structure of directorates and at some of the boundaries between core Government and the public body roles, to make sure that there is no duplication.

Given the environment and the direction of travel, I think that it is for me, coming in as a new permanent secretary, to pursue as many avenues of inquiry as possible. As always, we want to do that in close consultation with our colleagues and our trade union partners. For my part, I want to look at what the options are as we go forward.

I understand that you want the civil service to be an attractive place to work, but it should also be a realistic place to work, and it should be a fair place to work, because taxpayers’ money is funding it. Many people working in the private sector will be looking at this and thinking that it is not fair or sustainable.

Let us look at the issue of hybrid working. Your website says:

“As part of our current Hybrid Working Policy, staff members in roles which are suitable for hybrid working may have the opportunity to informally deliver work from home”.

What is the Scottish Government’s formal policy on working from home?

The formal policy is that, from October, we will have a strong expectation—

But what is it now?

10:30  

At the moment, I think—I do not have the wording in front of me, but maybe Lesley Fraser can help—it is something along the lines of an expectation of one day a week in the office.

Where it says that a staff member has

“the opportunity to informally deliver work from home”,

I am not entirely sure what that means. Could you recall civil servants back in five days a week under their present employment contracts?

Yes, we could. The conditions have not changed.

Why are you being so generous in your approach, when people out there in the real world are thinking that this is not sustainable?

I understand that perspective. We are trying to lead this change in an effective way. You have seen the evidence—some of it was reported in the newspapers this morning—of some people’s reaction to the change in the organisation and the anxieties that that suggests. For me, that confirms our view that we need to proceed gradually but with determination.

What does it tell you about the culture in the civil service that people are saying that it is an infringement of their human rights to ask them to go to work?

It is hard to know what the majority view is and what the dominant culture is. What we have seen in the newspapers this morning is that certain individuals have expressed a personal view about it. I have had a number of colleagues say to me how pleased they are with the change in policy and how positive that is going to be, and other witnesses here will have had that, too. I am confident that, in October, we will get to a place where the policy is warmly received and we can move forward from there.

In any organisation, you need a good understanding of the culture in which change is landing in order to be able to lead that change in an effective and kind way, but ultimately with determination to do the right thing.

I have two points of clarification about the policy. Should civil servants be paid for their time travelling to work? Would you countenance that?

No.

Are you saying that, if somebody refused to come to work, disciplinary action would be taken against them?

No, not for a simple refusal to come to the office. On that isolated matter, if someone is in that situation, despite having had all the management conversations and having followed the process that we are putting around the policy, it might well depend on whether other aspects are in play and on the posture of that individual, the language they are using and so on. Someone refusing to come into the office is not, in and of itself, a narrow trigger for disciplinary measures.

Last year, you reduced the working week to 35 hours. What practices and mechanisms do you have in place to monitor compliance with that working week for those who are working from home?

I will ask Lesley Fraser to respond to that.

It is the responsibility of line managers and directors to oversee the working patterns and the arrangements to ensure that the work in their areas is done.

For clarification, if somebody is hyper-efficient and can do the work in 20 hours a week, is that all right?

We are delighted when people are very efficient and effective, and we know that a number of colleagues do that. We also know—for example, from our flexitime system—that a number of colleagues go above and beyond their regular hours in order to deliver. “In the service of Scotland” really does strike a chord with colleagues, and I see many colleagues working in that way on a regular basis.

Ultimately, performance is managed locally, but we can oversee it in areas such as executive team meetings, where we can see data on flexitime, performance and the differences between areas in the organisation. We can then provide targeted support and help where that is required.

Do you have any data on the number of disciplinary cases that have been brought against civil servants who have not complied with the working week or have not responded to an informal arrangement with their line managers?

I am not aware of any, but I will check and see whether that is an issue. Generally, in my experience, disciplinary matters tend to be multifaceted: a number of issues are going on for an individual or in a team, which require to be worked on and resolved. It is hoped that they can be resolved positively, but, on occasion, they are not, which is when our disciplinary procedures kick in.

I have two quick final points to ask about, if I may, convener. The number of sick days within the civil service has increased significantly to 77,500, which works out as nine days per full-time equivalent civil servant. Are you concerned about the apparent sick-note culture that is developing in the civil service?

I am concerned about the figures. Anyone in a position of responsibility wants to have a healthy, flourishing workforce. I think that I am right in saying that 6 per cent of those sick days are related to workplace stress. That is 6 per cent too many and I want the figure to come down, but, to some degree, it provides some reassurance that the absence rate is not a direct product of the workplace environment. About 20 per cent of sick days are due to respiratory illness, and 20 per cent are due to general stress and anxiety. I would want to see those figures coming down, both because we have a duty of care to the individuals and, more broadly, because of the point about providing value to the taxpayer.

We have discussed those figures in the executive team, and there is a fair bit of variance between different teams, which suggests that there may be particular circumstances at play in different business areas. The current data that we are tracking is good. In my new role, when I think about accountability, I think about it in two respects: in my line management role relating to my director general colleagues, I am looking to review the figures in their areas regularly and expect to see improvement, which will then be socialised collectively in the executive team so that we hold each other to account to a degree.

I share your concern on that issue, Mr Hoy, and I intend to get some improvements.

Finally, the Government has placed great store by its invest to save fund, to try to deliver efficiencies across Government. We note, from the answer to an FOI request on 12 May, that only 26 public sector organisations have submitted applications. Seven of those were submitted by local authorities and only 19 were from national public sector bodies. What does the fact that so few have come forward with proposals to make savings in their departments tell you about the appetite for public sector reform and efficiency?

The invest to save fund is a specific vehicle that will give us some interesting insights. It was never set up at a scale that was meant to be universal, but some early adopters—organisations and people with specific ideas that they want to trial—will get a lot of learning out of it. We must have the ability to try some things and see how we get on with them. Overall, the response has been encouraging. I would not take too much from the number of applications, as it does not say anything particularly meaningful about the overall appetite for change. In my dealings with leaders across the public sector and with people who are working in public services, I have seen that there is an appetite for innovation and change in order to better serve the public.

Good morning, Mr Griffin. You may have detected a fair level of scepticism around the table about the civil service numbers, given that all my colleagues have been talking about them. There are some good reasons for that. In May 2022, the now Deputy First Minister stated that she wanted to see the size of the civil service return to pre-Covid levels. At that point, the civil service had 22,800 employees, and it now has 27,400 employees. Are we not right to be sceptical about your ability to cap that number, let alone reduce it?

Generally, scepticism in public life is an appropriate stance. I mean that entirely properly and respectfully. We need to deliver this, and I think that our best response to a sceptical line of inquiry from community representatives is to get on and deliver. In the period in play, there have been a number of unexpected shocks and the situation has been volatile. Unfortunately, it does not look as though the volatility will ease any time soon, but the direction of travel is clear, as is the expectation of the Parliament. We need to get on and deliver.

Gregor Irwin has been doing some work locally in DG economy and could speak a bit about that as a case study for the kind of leadership and methods that we are talking about, which will help to get numbers down.

This example goes back to the period that you are referring to, when the DFM made that statement. Around that time, between April 2022 and April 2023, we went through a process of restructuring and transforming DG economy, which is the part of the Government that I am responsible for. That resulted in something like a 20 per cent reduction in headcount, and the process has continued since then—it is on-going.

A number of things are changing in the environment that we are contending with, which means that in some parts of DG economy we have had to increase the headcount while in other areas we have had to decrease the headcount. For example, just this year, the European structural investment funds team has been wound down and that programme has been successfully closed. At the same time, we have taken responsibility for planning in Government and we have increased resource for that.

As well as a managing down of the headcount in DG economy—once you control like for like, it is significantly lower than it was pre-Covid—reprioritisation work is going on within the DG area.

In February 2023, John Swinney came to the committee and said:

“In relation to the Scottish Government, we have headcount controls in place. We are working to reduce overall staff numbers.”—[Official Report, Finance and Public Administration Committee, 7 February 2023; c 15.]

However, we can see from figures for the last quarter, which were published just last week, that that number is going up again. It is up by a further 200. It sounds to me like you are talking about a deprioritisation of DG economy—which is a concern for me—but the overall picture is that the number continues to rise. The current trend is that the number is going up, is not it?

There are two things in play here. One is that the controls that, I think, Mr Swinney would have been referring to were the internal controls for the core civil service. We have a recruitment committee that scrutinises any proposal for an external recruitment as well as any for an internal recruitment, given that there is a common citizenship with public bodies. Our direction of travel is firmly down the way.

The figure that I think you might be referring to relates to a broader conception of the civil service that includes agencies and non-ministerial departments. That is a much bigger number to begin with.

It is 73 per cent bigger than it was in 2007.

The Scottish Government’s controls over that are less direct. The recruitment headcount controls that I think Mr Swinney was referring to are specifically for the core civil service, which numbers around 8,900.

That number continued to rise in the last quarter. In a year, will it be a failure on your part if that number continues to rise, given the announcements that we have heard in recent days?

The core civil service number needs to come down, and I am confident that we have a number of methods for achieving that already in play—and we are considering a range of others. It is reasonable to hold the permanent secretary to account for the size of the core civil service, in line with ministers’ aspirations and policies.

As regards the broader civil service agencies, the non-ministerial departments and the wider picture of the public sector more generally, the figure is in the ballpark of what Mr McKee was talking about when he spoke of a 20 per cent reduction, and the levers that central Government has are not quite as direct as having the ability to scrutinise and control every individual proposal for external or internal recruitment—I would probably put it that way.

I think that ministers have pretty significant powers to deal with such things. Whether they decide to use those powers, directly through legislation or otherwise, is a different question.

I will move on to a different area, which possibly relates in part to your previous role in intergovernmental relations in the UK. Your predecessor stated that one of his priorities in the past year was to see a reset in the relationship with the UK Government. How is that going?

The reset was initiated by politicians at a political level after the general election. We heard that language from both the Prime Minister and the First Minister. I note that the Prime Minister was in Edinburgh on the first weekend after his election for a good meeting with Mr Swinney. They have met a number of times since then, either at dedicated meetings or in the margins of wider fora.

There are areas in which, at a ministerial level, there are good working relationships and a commonality of purpose. As you might expect, there are areas in which there are political differences, including differences of emphasis or of direction.

10:45  

In the civil service, we benefit from the relationships that we can build with our colleagues in Whitehall, as well as those in Cardiff, Belfast and Dublin. We have seen a number of examples of that recently. About a month ago, we were pleased to host the civil service leadership group, which is open to all the directors general and permanent secretaries across Whitehall and the Welsh Government. They came to Scotland for two days. We hosted a series of visits around the country to see examples of projects to address child poverty. There was a dinner, and the First Minister addressed the participants the following morning. There was also a plenary session to look at more general questions of civil service leadership and reform.

That was very significant. It was the first time that that has happened in Scotland for a period of time. It was a great opportunity to further develop and build relationships.

Speaking personally, since my promotion, I have been warmly received by colleagues. I usually attend the Wednesday morning meeting of permanent secretaries, which is chaired by the cabinet secretary, Chris Wormald. At a professional and personal level, colleagues have been very welcoming. I saw a number of people at the British-Irish Council summit in Newcastle in Northern Ireland a couple of weeks ago.

The point that I am making is that civil servants must have close working relationships with others across these islands. Such relationships underpin our ability to make progress, to problem solve and to pre-empt political disagreements where otherwise they might arise. It also means that we can provide a framework so that, when there is disagreement, it is not too debilitating and it does not obstruct process.

There will be political tension. The sheer number of different political poles that have been created through devolution mean that, inevitably, there will be different parties in power in different parts of the UK. The civil service can really have a role in underpinning continuity and making sure that our professional relationships with our opposite numbers are as close and as productive as they can be.

Thank you for all of that. It is very useful.

You talk about pre-empting political disagreement. Sometimes, the positions that politicians take will get in the road of some of the good relationships that you have.

You are the principal policy adviser to the First Minister. Prior to the UK budget in autumn last year, the Scottish Government demanded an additional £70 billion of spending from the UK Government. Since that budget, there has been an additional £20 billion of demands. Were you and your civil service involved in costing those demands?

Personally, I was not, but, if ministers asked for specific costed things, that would have been the product of advice from civil servants in the Scottish Government.

As an intergovernmental relations expert, what form would you say such demands take? Are they just done with a press release, or do civil servants engage with their counterparts in UK departments and ask for an additional £70 billion by saying, “This is the position, and this is why we think you should spend this money that we don’t have”?

The process works best, in both directions, when there is good dialogue at official level and then between ministers. Ideally, if everything progresses smoothly, you reach a more formal setting.

At the very start of my career, I worked in the United Nations. The UN almost formalised the process of having different levels of interaction through formals, informal formals and informal informals. That is not a bad summary of how we operate. I would certainly expect my colleagues in the Scottish Government and across the civil service in Whitehall to have good levels of engagement and transparent conversations about costings before we reach any point of political dialogue.

On top of that £90 billion of spending demands, the Scottish Government has opposed £45 billion of revenue raisers, so the demands of the UK Government that are coming from your offices are for a fiscal adjustment of £135 billion. Those demands are not realistic or credible. How do those demands speak to a reset of relationships between the Scottish Government and the UK Government, when your officers are producing such figures, which have no basis in reality?

I do not know the specific figures that you are discussing. I do not know how they are profiled, what period of time they relate to, whether they involve capital or revenue funding, and so on.

I would be surprised if that work had been done, but they are figures from the Scottish Government.

I expect my colleagues to be giving ministers the best advice, and that is not just on the figures that are involved. We always need to undertake accountable officer assessments when we are proceeding with a proposition and a course of action. I expect my colleagues to support ministers in that way.

Mr McCallum, is your department costing the figures in such press releases?

I have a couple of things to add to what the permanent secretary has said. We have regular engagement at official level with the Treasury’s devolved Administrations team, and the different Governments’ priorities are discussed as part of that. At the ministerial level, the Cabinet Secretary for Finance and Local Government will be meeting the Chief Secretary to the Treasury in London on Thursday, so that relationship is there and fiscal discussions are happening. Figures in relation to specific policies are always costed, whether independently or by economic officials in the Government.

You make no comment on the cumulative effect of the Scottish Government continually issuing completely unrealistic demands for money on the ability to have a proper relationship with the UK Government. I am worried about the stated priority of a reset when the conduct of the Scottish Government is such that it is not being a realistic partner in those conversations.

Forgive me, but I do not know the specifics.

Maybe I will write to you and you can set out a response, because we have some detail on the issue.

Yes—thank you.

Have you been involved in any costings around full fiscal autonomy? I think that the answer is that you probably have not.

The current fiscal framework, which was set through the Smith commission after 2015, requires a number of policy measures to be worked through under it. That is what policy officials have been working on. Two examples are the current live issues around the aggregates tax and the air departure tax. They are part of the current fiscal framework that we are working through. The position of Scottish ministers on full fiscal autonomy is known, and the cabinet secretary for finance set it out at this committee two or three weeks ago, but it is not actively being worked on by exchequer officials at this time.

So, there is no work on that.

Mr Griffin, I will ask your view on the risks to the university system in Scotland. You will be aware that we have had evidence on a variety of occasions about the challenges in the system. Are you worried about the sustainability of universities in Scotland?

We are seeing specific examples coming forward, and I know that you will be particularly concerned about the position of the University of Dundee, Mr Marra. The report that came out provides a detailed explanation of how that transpired. I am reluctant to draw generalised conclusions from what played out there but, overall, the Government wants to see a flourishing university sector where it is felt that financial sustainability is achievable.

On 19 March, the Scottish Funding Council gave evidence to the Education, Children and Young People Committee. In response to some of my questions, it said that it was telling the Scottish Government that there are pressures on the sector and not only on Dundee. I will set aside for the moment the situation at Dundee, which I agree involves particular issues. There are very significant pressures across the system. Where does the system’s sustainability appear on your risk register?

There is a literal answer to that, which I can write to you about. We have a corporate risk register and, from memory, I think that that issue is an entry in it. If you do not mind, I can give you an empirical answer in writing.

Can I ask for slightly more of your own reflections? Those particular instances aside, our system is under increased pressure, which is of great concern to me and other colleagues. The number of international students is declining and there is no sign of that recovering—in fact, it is probably getting worse. Multiple universities have redundancy schemes in place.

Higher education is one of the jewels of Scotland. I am sure that it is central to Mr Irwin’s work on Scotland’s economy, and it is in significant distress. Are you telling the First Minister that he has to act and do something about it?

We had a couple of discussions during the higher education team’s presentation to the executive team, in which that team shared some of its analysis of where we are. The First Minister is well sighted on the financial pressures that some institutions face. As I have shared with all my colleagues, it is important that, if strategic work needs to be done to take stock of a given sector’s situation, people carve out the time and space to do it. If a view emerged among ministers that they wanted that to happen, we would absolutely be able to do such work and give them good advice.

Are you worried by the reflections in the Gillies review on the Scottish Funding Council’s lack of efficacy in its governance of the sector’s overall fiscal and financial sustainability?

There are a number of things noted in the Gillies review that you would not want to see happen, and the conduct of—

I am asking specifically about the broader sector rather than Dundee; I am raising specific questions about the Scottish Funding Council.

The Funding Council has a new chief executive. I have every confidence in her leadership to take a lot of learning from the Dundee situation and apply it to the sector as a whole.

Might I ask for a clarification before I come to my questions? Mr Griffin, are you advising the First Minister that the higher education sector has significant issues, or are you waiting for Mr Swinney to come back to you?

It is largely playing out through the education relationship. My colleague Neil Rennick, the director general education and justice, Ms Gilruth, the Cabinet Secretary for Education and Skills, the First Minister and I have touched on the position at Dundee several times. To my recollection, we have not had a one-to-one discussion about the sector overall, but I am only a few weeks into the role.

I find that a bit concerning.

I want to come to an issue that is troubling the committee a great deal. It relates to transparency and good government. Let us be honest: our job is to scrutinise both of those things as they relate to the spending of public money. The context is that an increasing number of framework bills are being introduced to the Parliament. Due to the bills’ very nature, it is very difficult for a minister to put the full cost on the table, because stakeholder engagement is on-going. In turn, that has led to a number of financial memorandums, which this committee has not been at all satisfied with, and we have sent several of them back. Is the growing number of framework bills a problem?

Framework bills have their place. You need to be able to approach an issue at some breadth and have flexibility in how you implement proposals, but it is important that the Parliament gets the right information when it comes to the financial implications of any bill, let alone a framework bill.

11:00  

I understand the committee’s concern, which we have taken on board in Government. On 6 March, Mr Hepburn wrote to the committee to confirm that the finance guidance note on preparing memoranda, which goes with the Scottish public finance manual, has been updated to ensure that the committee’s view is given greater prominence. We have also updated our internal guidance on the preparation of bills, so your concerns have been heard and responded to.

When implementing any change of policy or guidance in such a way, follow-through really matters. The way I think about that is, first, to focus on the line management operation. I expect my directors general, who are in charge of a particular policy or legislation, to take heed of expressed concerns. Secondly, in our system, the input of non-executive directors, risk and audit committees and so on are highlighted and taken into account through our assurance committees. A third level is around culture: my colleagues and I talk about such matters and how to set the highest example in communicating financial information that is connected with any piece of legislation.

That is helpful. Nonetheless, there is a structural issue. Due to how they operate and by their very definition, framework bills make it much more difficult to provide an accurate financial memorandum, because engagement with stakeholders is on-going and, therefore, it is very difficult to calculate future costs.

The committee is concerned because we have recently received quite a number of financial memoranda that are nowhere near accurate. In turn, that makes our scrutiny of the public money spend that is involved very difficult. Is that a matter that concerns you and your officials?

Yes, it absolutely would concern me if we were providing inadequate financial analysis and information to any parliamentary committee. As I said, that concern has been taken into Government, and the relevant guidance has been updated. As I said, that change needs to be implemented and followed through, and I have given you some ways that we need to do that. However, it matters a lot to me that we provide accurate and effective financial information so that the Government can be properly scrutinised.

Is there also a concern that a number of bills that have come to the Parliament have been subject to a very considerable number of amendments, particularly at stages 2 and 3? It is becoming much more difficult for the Parliament to get through Government business because of the size and complexity of a lot of those bills. There are many cases: I can think of three bills, including the Education (Scotland) Bill, to which a large number of amendments have been lodged, but then they have not been moved or have been rejected. Is that aspect of the legislative process a concern for the Government?

In my first few weeks, that has not been brought to me as a matter of urgency. We have very good teams that work together on bills. In my previous role, I line managed our parliamentary counsel, and Andy Beattie is a very experienced and well-regarded member of that counsel office. I expect that, in the process of preparing bills and thinking about the strategy, the advice that is being taken from professionals on the conduct and operation of such bills is all good. The straight answer to your question is that the issue has not been brought to my attention.

There is a feeling among the public and, indeed, some parliamentarians, that, for some time, we have been passing legislation that is far from perfect—in some cases we have had to come back to it or even to repeal it. I suggest that one reason for that is that the Parliament’s legislative process has become much more complex and difficult. When it comes to good government and accountability for public money, that must be a concern.

I think that we would want an optimised bill process: strong propositions, a strong understanding of the legislation’s impact, a strong analysis of equality and human rights implications; good and accurate financial information; and to conduct the bill in a way that allows for good debate and an orderly—

Is a conversation going on between you and your officials and the Scottish Government about the need to upgrade some of that process in the Parliament?

As I say, in my first few weeks, it has not been something that I have looked at yet. I recognise the strength of feeling in what you are saying, and I am happy to take that back and make it a priority for the next little period.

It is very important, because the Parliament has to work well.

Of course.

To ensure that it does work well, the committees must work well. The bigger our frustration, particularly from a financial angle, the more difficult it is for us to carry out effective scrutiny. With all due respect, I do not think that that is our fault. We try our best to ensure that we have all the facts to hand and that we scrutinise as much as we can, but we are frustrated due to a number of aspects of how the legislation, especially the financial memorandums that accompany it, is presented to us.

We recommend that a big discussion on that be had with the Scottish Government. If that were done it would be greatly appreciated.

I hear that, Ms Smith, and the strength of feeling behind it.

Earlier, I mentioned some aspects of public life in Scotland. My colleagues and I feel the sense of shared stewardship of the institutions of public life. As I say, I hear the points that you are making and the strength of feeling behind them, and I will certainly look into that.

You have had quite a lot of questions from my colleagues, so I will pick up on one or two points.

We have talked about reducing the size of the civil service. That is also happening at a UK level, and I wonder how the two interact. If the UK civil service reduces, that might mean that we get less money through the block grant. Are the two combined in any way, or are you just looking at Scotland?

There is a high degree of devolution in the way that the civil service operates in Scotland. As I said, civil service pay is reserved to Westminster but the decisions about policy and operations are devolved to the First Minister. In turn, there is a scheme of delegation to me, as permanent secretary.

We are in a good position of being well informed about the direction of travel at Westminster, Cardiff, Northern Ireland and everywhere else, so that we learn good lessons about good public administration. We can then look at matters in our own context, including our relationship with our unions, our workforce and ministers’ views on the matter.

There is much happening in the civil service space, which I take to be a positive thing. We are reasonably well plugged in as a result, and we can be in a position to take the good aspects from that and apply them here.

A challenge that we sometimes have in Scotland is that an announcement is made at Westminster that there will be capital or resource spending, but, because we do not know where that money is coming from, we do not know whether we will get extra money. Sometimes, it will come out of an existing departmental budget and, therefore, there is no extra money, but we do not always know that at the time.

Is that something that civil servants speak to colleagues at Westminster about, or might they not know themselves, because although the Government ministers have made an announcement on new expenditure, they might be borrowing or doing something else? Is that a space in which we can see an improvement?

I will ask Richard McCallum to come in, as he is probably the expert on this.

My observation, based on experience, is that it might not always be absolutely crystal clear in the first throes of the announcement, although it is in due course. Colleagues must go through a process in order to be specific about budgets and so on, which then brings a level of clarity through budget revisions, block grant adjustments or other mechanisms.

What you have said is probably right. From the perspective of the Scottish exchequer, the fiscal events at Westminster are key for us. When there is a fiscal event such as the recent spending review, we will get a formal statement from the Treasury about what it means for the Barnett consequentials that Scotland will receive. As you say, sometimes, when there is a policy announcement, what that means is not always clear, but, as I said to Mr Marra, we have good lines of communication with the Treasury about those things. Often, outside the core fiscal events that I have spoken about, the normal process would be that money would come from within departmental budgets, so there would not be an associate consequential.

So, would we assume that something like high speed 2, which appears to be overrunning, would be within a department’s budget, or would extra money come to us?

There is a calculation to work out the level of Barnett consequentials that we will receive when the matter is reserved—not all of the transport budget has a direct consequential, so we would not receive an associated level of funding. We have a pretty good understanding of the means of that calculation and there is good dialogue between the Treasury and the Scottish Government. We will know whether there are additional costs and, if those change the budget of a particular department, how they would apply to the Scottish Government’s settlement.

I will probably follow that up in the future.

You have already been asked about the fiscal framework. Certainly, I feel as though Scotland gets a raw deal, and other Scottish politicians might say the same. Obviously, the Westminster politicians think that Scotland is being dealt with very generously. A couple of years ago—which, I accept, was before you were in post—Shona Robison had those discussions with the Treasury. Where does that leave the civil service? Scottish ministers are expecting support and that you will argue the case for Scotland, whereas Westminster civil servants argue the case for the UK. Is that a problem, or is it just handled?

It goes back to some of the answers that I gave to Mr Marra. It is very important that civil servants who are serving different sets of ministers are able to have good, honest, evidenced-based dialogue, if you like, aside from the public debate that takes place between politicians. That is absolutely normal. Across these islands, more often than not, different parties will be in power in different Administrations and the civil service has to be able to provide the continuity and dialogue and to prepare the ministerial narrative. It is incumbent on us to serve our ministers and on colleagues in the UK Government to serve theirs, just as our colleagues in Cardiff must serve the Welsh Government.

The convener asked you about public inquiries, which we have spent quite a bit of time on, and the committee is partway through our inquiry at the moment. Can you give us a little bit of background on what happens when a public inquiry is being set up? Does a minister come to you and say, “I’ve decided to have a public inquiry,” or, “Do you think I should have a public inquiry?”—or does it vary from case to case? It has been suggested that part of the civil service could support public inquiries by giving guidance and support.

Of course. When thinking about the type of inquiry or investigation that is needed, ministers will take into account the details and background of each event that has the capability to cause a level of public concern, and they will assess that against what is possible. We will provide them with advice based on statute, experience, lessons that have been learned, the likely costs, and so on and so forth. We will then have a discussion about who might be the appropriate person to lead the inquiry. There is usually dialogue between ministers, civil servants and the head of the inquiry from the outset. Once the inquiry begins, the chair will have a fair amount of autonomy to pursue it in the way that they assess.

11:15  

I think that we are not bad at sharing the lessons of inquiries past. That is partly because there is a team that is specifically aligned to the inquiries legislation. Usually, that team is involved in the early discussions at the genesis of an inquiry, and it then branches out into the different policy areas concerned. For example, if it were an inquiry on health, that would go to a health team.

As I said earlier, the work that the committee is doing to investigate the different aspects of public inquiries—the public value, the public interest and so on—is such that, if the committee comes out with recommendations, I, for one, would have an open mind about their civil service aspects. Were the committee to recommend that we change our practice, I would look at that carefully. I have an open mind about any changes that we might make.

One issue that witnesses have raised is the importance of an inquiry’s terms of reference. Do those result from a negotiation with the chair, or do you have a framework for terms of reference that keeps them quite tight? It strikes me that if the terms of reference are very wide, an inquiry will just roll on forever.

That takes us to the Inquiries Act 2005, under which ministers have the power to establish the inquiry and to set the terms of reference. In my experience—and I think that this is probably good practice—you would not impose those on a chair. You would share the proposed terms of reference and you would be open to making a reasoned adjustment on that individual’s behalf. However, ultimately, that power under the Inquiries Act 2005 sits with ministers. I imagine that you would want some dialogue, but that would be the nature of the conversation.

I was looking at the paper “Future Trends for Scotland”, which raises a wide range of issues. I will not ask you about all of them, but I picked out three that are coming along. Can you say anything about how the civil service is dealing with artificial intelligence?

AI operates at a couple of levels. One is a more parochial level, regarding how we might deploy it in our work to assist with some of the efficiency and effectiveness concerns that the committee has raised this morning. We have already deployed a lot of intelligent automation, which Lesley Fraser may be able to speak to. There are some good case studies of where that is used.

With regard to artificial intelligence and large language-learning models, we have latterly been using Copilot, on a pilot basis, to see whether it can assist us with routine tasks around taking minutes and synthesising bits of information. There is no reason to think that some of that technology does not have a lot of potential to assist the civil service to be efficient and effective.

The other level is a much broader one concerning the application of AI in the economy and society more generally. Gregor Irwin might want to say something about that, based on the conversations that he has had with business leaders and industry.

I will leave it there, Mr Mason, to see what your appetite is for either of those.

It is a huge area. I just wanted to touch on it today because it had not been mentioned, but I am not going to go into it. However, if Mr Irwin wants to say something, he is welcome to do so.

I am happy to do that. As part of the programme for government, we are setting up AI Scotland, which is a coalition of different parties that will come together to drive deployment of AI in the Scottish economy. The exact way in which that is to be done is under discussion and is being worked through at the moment, but, essentially, it involves the public sector and the private sector being brought together to work in a constructive manner.

The way that I think about AI and the impact of its deployment across the economy is not to think about it just as AI but to think about it as being intrinsically linked to innovation in the economy and the development of the digital economy. AI is one means of achieving those outcomes. That is the spirit in which we are seeking to work with economic partners to do just that.

I should also mention that we are mindful of the impact of AI and technology on the labour market, including the potential for disruption to the labour market and what that will mean for skills provision and support. It is still relatively early days when it comes to seeing the transformational impact that we expect these technologies to have on the economy, but we are paying close attention to that element.

The second future trend that I want to discuss is cyberattacks. How safe is the Scottish Government from those?

Lesley Fraser might want to say more on that in a moment. In the light of the introductory briefings that I have had and contacts with my colleagues in Whitehall, I am concerned about that area. I need assurance that we have good arrangements in place. We already have good systems across the Scottish public sector, but, as ever, we are really only as resilient as the weakest links in the chain. That area will need investment in the years to come, to update legacy systems and to ensure that we are well protected. Unfortunately, we know from the strategic defence review and other aspects of our work that we are potentially vulnerable to hostile state actors in that space. The cyberattack issue sits on our corporate risk register, and senior leaders will need to be pretty relentless in expecting high levels of assurance and preparedness.

Lesley Fraser might wish to say a little more.

I will be happy to. That is one of the areas in which we have been investing in recent years. We have brought together the Scottish Government’s cyber resilience capability and that for the wider public sector, so that we are able to take a once-for-Scotland approach, offer an integrated service and aim to ensure that people have access to high-quality cyberdefence insight and information. That is another area in which we work very closely with our UK Government colleagues, to draw on their expertise, insight and awareness of where particular threats are arising.

One or two public bodies have suffered a bit recently, including one of the health boards.

Sadly, the public and private sectors are being tested in that area pretty much constantly.

The “Future Trends” document says that the risk of experiencing further pandemics is increasing. Are we ready for the next pandemic?

I am assured that we are taking effective steps, in response to the findings of the Covid inquiries. The UK inquiry was the first to produce recommendations. In module 1, which dealt with preparedness, Baroness Hallett set some pretty exacting expectations for how she would monitor progress on those, and we are reporting according to the timescales that she asked for. We have good, experienced resource in that area. Our resilience operation is fully plugged in and is working with our partners. I am confident that we are working on the UK inquiry’s recommendations and are preparing effectively.

A series of other modules is still to come. I expect, and hope, that the recommendations contained in those will assist us in taking the necessary steps. Clearly, we will need to do that work, which will be of great importance.

Thank you.

Craig Hoy has a brief question.

It is on a subject that I thought might come up earlier but that did not. We took evidence from several public bodies on the Scottish Government’s no compulsory redundancies policy. All of them said that, although they did not intend to use the option of compulsory redundancy routinely, they saw it as another tool in their toolkit. As we embark on reforming our public service and the civil service, what is your view on potentially adding that tool to your own toolkit, to ensure that you would have the whole panoply of options in front of you?

In general, that policy is extant. There are circumstances in which ministers permit public bodies to pursue it. Gregor Irwin might want to say something about the example of VisitScotland, where that has taken place recently.

The policy is that compulsory redundancies should happen only as a last resort. Exhaustive efforts to redeploy and reskill impacted staff need to be made and should continue. VisitScotland has gone through a substantial programme of reorganisation to digitalise its operations, in recognition of the fact that its work has to happen before tourists arrive at destinations. That has resulted in the iCentre closure programme, the redeployment of staff and a move towards providing services digitally. VisitScotland has gone through the process of redeploying staff and has also provided voluntary redundancy schemes. Pursuing compulsory redundancy would be the last resort in that process, carried out consistently with the policy that I have just described.

Would you support using that option as you embark on the process of reform, Mr Griffin?

That is a policy choice, which is for ministers to make. It did not feature significantly in the public sector reform strategy. We will see what happens with the VisitScotland process and whether we can take learning from it into the system.

When, before his departure, your predecessor appeared before us, he said that he thought that the growing gap between what we receive in Barnett consequentials for social security—which I know is dynamic and goes up and down at different points in time—and what we spend is “material ... but manageable”. Is that your view currently?

As is so often the case, JP Marks has put that well. The medium-term financial strategy that will be published tomorrow will say a bit more about those matters.

We have had a very wide range of questions, which I thank you for answering. It cannot be easy to draw on so many different sources of information simultaneously. I know that you will follow up on one or two matters in writing. Before we conclude our meeting, do you wish to make any further points to the committee?

I was not expecting that question, convener. I do not think so. As you say, our discussion has ranged far and wide.

I will just add that it is a matter of great pride for me to be in this role after so many years in the Scottish Administration. I am very proud of our team, and I assure the committee that we will do our absolute best to serve communities across Scotland.

Thank you very much for that.

We will have a five-minute break before we move into private session, to allow our witnesses and broadcasting and official report staff to leave.

11:27 Meeting continued in private until 11:51.