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Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Thanks, John. I think there will be a return to some of those areas in further questions from the committee.
I wish to move on, and I invite Craig Hoy to ask some questions.
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Actually, I think that Andrew Scott wants to come in at this juncture.
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Thank you for those answers. Colin Beattie has a series of questions about sponsorship arrangements.
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Did you want to come back in, Mr Brannen?
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Other committee members will probe that matter later.
Mr Brannen, you said that the framework document for the commission is with the cabinet secretary for sign-off, but our understanding is that the Crofting Commission’s board has not yet agreed the document. Can you clarify the situation in that respect?
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
So, there was a board meeting this week at which the framework document was signed off.
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Thank you for clarifying that.
On a number of occasions, our predecessor committee raised concerns about the adequacy of sponsorship arrangements between the Scottish Government and public bodies. Our understanding is that the responsibility for such arrangements is clearly set out in the Scottish public finance manual. To what extent did the sponsorship arrangements for the Crofting Commission meet the requirements that are set out in that manual?
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
Thank you for that helpful clarification, Mr Kerr.
I realise that, in the tone of what has been said so far, there has been a sense that we are looking back in history, but the fact is that we are concerned about ensuring that, in the contemporary dealings between the sponsor division and the Crofting Commission and in the relationships between the senior management team and the board, everything is in order. The Audit Scotland report has highlighted some quite alarming things about the failure to properly consult internally commissioners and members of the board, which, I have to say, rang alarm bells for us.
Before I bring in Craig Hoy, I will ask one final question. According to the auditor’s audit dimensions and best value report, when the CEO asked the sponsor division for backing, it was for “anticipated opposition” from the board when the CEO was attempting to drive through changes. It was also reported that the sponsor division suggested that
“the CEO ignore the Board’s opposition and proceed as he sees fit”.
Understandably, the auditor described that as undermining
“the role of the Board”
and overstating
“the role of the Sponsor Division”.
Can you explain how such a situation occurred?
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
I finish by reflecting on my first question, which was to ask Roy Brannen whether he accepts in full the findings as well as the recommendations of the Audit Scotland report, and I think that he said that he does. However, I want to revisit a couple of points that came up during the evidence this morning. At one point, there was a suggestion that there was a failure of active engagement by the audit and finance committee in the drafting of the 2020-21 budget, but that is not how I read Audit Scotland’s report, which suggests that the audit and finance committee was sidelined and there was minimal involvement of the senior management team, outside of the finance director and the chief executive. That is what led to recommendations of a greater degree of key stakeholder involvement.
The other point that I come back to is the suggestion that some of the blurring of roles and responsibilities was the product of Covid and people stepping into the breach when needed. Paragraph 13 of the Audit Scotland report states that some members of the board
“excessively involved themselves in matters that would typically be the responsibility of the Senior Management Team”,
and says that large amounts of board time were spent
“discussing individual grades that new staff positions should be at within the organisation, including for junior positions.”
The report suggests that those criticisms are not just a function of Covid but predate it. Mr Brennan, can you give us any reflections on those points?
Public Audit Committee
Meeting date: 16 December 2021
Richard Leonard
My final question is: could we receive a copy of the final framework document when it is signed off by the cabinet secretary, please?