National Scrutiny Plan for
Local Government  2010/11
A summary of Local Government  Strategic Scrutiny Activity

Prepared by the Local Government Scrutiny Coordination  Strategic Group
July 2010

About this report
This report introduces Scotland’s National Scrutiny Plan for Local Government 2010/11. This is the first time that a plan of this nature has been produced. This report outlines the context within which it has been prepared; sets out how it has been developed; summarises what has been achieved; and outlines what will happen next. It details the changes made within the individual scrutiny bodies to streamline their scrutiny work, the benefits to councils and the impact of councils’ own self-evaluation work.
The National Scrutiny Plan for Local Government (the Plan) is the key output from work being led by the Accounts Commission, at the request of the Cabinet Secretary for Finance and Sustainable Growth in March 2008 to undertake a ‘coordinating and gate-keeping role’ with regard to ‘scrutiny relating to the corporate and strategic role of local government’. We have sought to be open and transparent and have included all strategic scrutiny activity of which we are currently aware. In line with the phased approach requested by the Cabinet Secretary, our focus has been on planned scrutiny activity which assesses whole services or corporate functions. Thus, we do not focus on scrutiny activity carried out at service unit or institution level, eg school or care home inspections and we do not include the annual financial audit. 
The Plan has been jointly prepared by the Local Government Scrutiny Coordination Strategic Group. This group includes the Accounts Commission, Audit Scotland, Her Majesty’s Inspectorate of Education (HMIE), Social Work Inspection Agency (SWIA), Scottish Housing Regulator (SHR), the Care Commission, Her Majesty’s Inspectorate of Constabulary for Scotland (HMICS) and NHS Quality Improvement Scotland. Details  of each body can be found in Appendix 1; they are collectively referred to as ‘scrutiny bodies’ in this report. The group has also benefited from observer representation by the Scottish Government, COSLA, and SOLACE.
In developing this Plan we have engaged with COSLA and SOLACE on an ongoing basis and we acknowledge the input we have had from them and councils to date. Further feedback on the experiences of councils will be a fundamental part of an independent evaluation of the shared risk assessment process.

Background
Following the publication of the Crerar report on the Independent Review of Regulation, Audit, Inspection and Complaints Handling of Public Services in Scotland in September 2007, the Scottish Government undertook to develop a simplified and more coherent approach to local government scrutiny, as part of its wider approach to improving the arrangements for the external scrutiny of public services. A key aspect of this was the need to better coordinate and streamline strategic scrutiny work at corporate and service level, while continuing to provide assurance to the public. This marked a fundamental shift from scrutiny which had typically been based on audits and inspections done on a routine cyclical basis, towards a more risk-based and proportionate approach.
In response to the Scottish Government’s request, based on a key recommendation from Crerar, the main scrutiny bodies for local government have worked together through the Local Government Scrutiny Coordination Strategic Group to identify and agree the key risks in each individual council and to develop a plan of scrutiny activity to respond to those specific risks. This new approach, called Shared Risk Assessment (SRA), is designed to ensure proportionate and focused scrutiny and reduce the overall amount of external scrutiny activity in local government, while continuing to provide public assurance and help councils to improve. 
This Plan summarises the strategic scrutiny work for April 2010–March 2011 described in each of the 32 council’s individual scrutiny plans, called Assurance & Improvement Plans (AIPs). While the AIPs cover a three-year rolling programme for each council, the Plan covers 2010/11 only. A number of factors, including the creation of the new scrutiny body Social Care and Social Work Improvement Scotland (SCSWIS), have made it difficult to schedule precisely, at this stage, all of the activity planned for years two and three.

Part 1. What has been achieved?
We have reduced the time we will spend undertaking strategic scrutiny work in councils in 2010/11 by 36 per cent compared to the 2008 level
1. Compared to the level of scrutiny work undertaken in 2008, we have made a 36 per cent reduction1 in the time we will spend on strategic scrutiny work in councils in 2010/11. This is a reduction in the fieldwork element of our strategic scrutiny work. This is the part of our activity which affects councils most directly.
2. This reduction in fieldwork activity relates to strategic scrutiny work that takes place at corporate or whole service levels of councils. This is only one element of the work we do. Each scrutiny body also undertakes a wide range of other activity which has always been outside the scope of the SRA process, such as baseline financial audit, inspections of schools and care homes, policy development and provision of guidance.
3. The 36 per cent reduction is a direct result of the changes we have individually made to the ways we undertake scrutiny and the application of our SRA approach to the planning our scrutiny work. The approach has also resulted in an increase in the number of individual ‘scrutiny activities’ across Scotland in 2010. This reflects the changing nature of scrutiny work from whole system, large scale audits and inspections to smaller, targeted activities. These activities will individually have a smaller ‘footprint’ as they will take less time, involve fewer inspectors, and be more specifically tailored to the issues and risk involved. 
4. The detailed National Scrutiny Plan for Local Government 2010/11, can be accessed on www.audit-scotland.gov.uk/work/scrutiny/
We have developed a joint  process to identify where scrutiny work is needed
5. We have developed 32 Local Area Networks (LANs) of inspectors and auditors to enable us to share all the relevant information we hold about an individual council. The LANs undertake a SRA process, using that information to determine where scrutiny work is most needed to provide public assurance and/or to stimulate improvement. The LANs determine the most proportionate way to undertake that work, identify where joint work would be appropriate and engage with the council in developing its AIP.
6. We have developed a quality assurance process to ensure consistency in approach between the 32 LANs and the quality of the AIPs. This approach involves a panel of senior officers from each scrutiny body and peer representatives from Local Government. For this exercise there were four quality and consistency review panels, each reviewing eight AIPs. The panels reviewed the quality of the individual AIPs, as well as the consistency of risk assessment and scrutiny response across councils. 
7. Through this joint process we have improved our understanding and knowledge of individual councils, and also of each other:
•	We have a better and shared understanding of each council, its context, the information we collectively hold about it and the challenges it faces.
•	We better understand each scrutiny body’s remit, role, methodologies, approaches and scrutiny tools.
•	We have developed a Joint Scrutiny Code of Practice which for the first time sets out the arrangements for co-operation between the scrutiny bodies, our commitment to collaborative working, and the principles which underpin our work.
8. This improved understanding and knowledge will help us to continue to reduce scrutiny activity where appropriate in the future, through increasingly sharing each other’s evidence and evaluations, and by building more effective relationships with councils across all scrutiny bodies. It will also help us deliver more effective scrutiny where it is most needed.
We are developing a more proportionate and risk-based approach to scrutiny
9. We have, for the most part, stopped using an approach based on cyclical audit and inspection activity in councils. Any cyclical work is now undertaken only as a result of specific requests by ministers. For example, ministers requested a second cycle of child protection inspection because of the variability in performance in councils. Where a cycle of inspection has been required, we have worked to ensure this activity is also streamlined and proportionate, eg the Care Commission statutory inspections have reduced in frequency and intensity.
10. In the 2010/11 National Scrutiny Plan for Local Government, around half of the scrutiny activity is driven by Government requirements. We are working together to ensure that this work is proportionate, eg HMIE and the Care Commission are piloting the coordination and integration of inspection of fostering and adoption with the joint inspection of child protection to maximise the links and reduce overlaps.
11. There have been a number of other important developments which have the potential to reduce scrutiny activity further. For example, provisions in the Public Services Reform (Scotland) Act 2010 have placed on scrutiny bodies a duty to co-operate and the new Systematic Scrutiny Check (SSC) approach has been introduced to deliver on the Government’s commitment to apply ‘a test before considering any new bodies or new scrutiny functions’. The second cycle of child protection inspections went through the SSC process to ensure it was necessary and proportionate. 
We have streamlined our scrutiny methods
12. More proportionate and risk-based approaches to scrutiny have been adopted by each scrutiny body:
•	HMIE has ceased its cyclical inspections of the education functions of local authorities (INEA2), although the model remains if required in individual cases as a scrutiny response to assessed risk. The second cycle of joint inspections of child protection in local areas is based upon a proportionate approach. It has extended its more proportionate approach to inspection beyond council level through its new school and pre-school inspection models.
•	Following the conclusion of the first cycle of Local Government Best Value and Community Planning audits, Audit Scotland, on behalf of the Accounts Commission, has refined its BV audit approach, which it has tested at five pathfinder audits. The new ‘Best Value 2’ (BV2) approach is a more proportionate audit, based on activity directed towards areas of highest scrutiny risk. The redesign of the BV2 audit included the development of a single Corporate Assessment Framework for councils. This framework, when combined with the SRA process, allows Audit Scotland to coordinate corporate assessment work with scrutiny partners and reduce duplicated work.
•	SWIA no longer carries out full performance inspections. These have been replaced by a risk-based approach (the initial scrutiny level assessment or ISLA), resulting in more proportionate, targeted scrutiny.
•	SHR is no longer undertaking baseline inspections.
•	HMICS has stopped its cycle of primary and review inspections and has moved to supported force self-assessment, combined with risk-based and proportionate thematic activity. For example, attendance management, and the management of high risk offenders.
•	The Care Commission has amended the frequency of inspections, their regulatory support assessment process and ‘Regulation for Improvement Project’ according to assessments of risk and quality.
•	Work is being undertaken to streamline and integrate future scrutiny activity as part of the development of the new agencies Social Care and Social Work Improvement Scotland and Health Improvement Scotland.

We have moved away from a ‘one size fits all’ approach and developed a broader set of scrutiny responses
13. We have developed joint working arrangements to reduce duplication of work and scrutiny overlap. Our work is now more proportionate and tailored to the risk areas being examined: 
•	HMIE, SWIA and the Care Commission’s pilot integrated inspection activity around Child Protection and Fostering and Adoption inspections. 
•	Care Commission and SWIA inspectors are members of each Child Protection inspection team, facilitating opportunities for sharing information and joint work. 
•	The Mental Welfare Commission and the Care Commission are undertaking joint inspections in a small number of care homes for older people. 
•	Audit Scotland and HMICS have developed and tested a joint and proportionate BV2 approach in police forces and boards.
•	The National Scrutiny Plan for Local Government indicates a number of one-off pieces of joint work between two or more scrutiny bodies to examine specific risk areas. For example, Audit Scotland and the Care Commission are working together to examine care support services in the City of Edinburgh Council; SHR and Audit Scotland are working together in East Renfrewshire Council to look at housing issues.
14. Scrutiny activity is a catalyst for improvement and we have individually made changes to our scrutiny approaches and methods to better support improvement. This includes supporting councils in developing their improvement plans and capacity-building activities. Some inspectorates are also developing a supported self-evaluation model:
•	HMIE’s voluntary validated self-evaluation work, which has now been undertaken successfully in a number of authorities who requested to be early participants in the programme.
•	SWIA’s comprehensive approach to supported self-evaluation, including published self-evaluation guides, web-based e-tool, and network of link inspectors.
•	Care Commission inspections are based on the validation of self-evaluation undertaken by service providers.
•	HMICS’s supported force self-assessment.
15. Early indications from councils are that targeted scrutiny activity now being undertaken, is more proportionate and beneficial compared with traditional cyclical inspections, eg more focused on improvement and less time consuming for councils.

Part 2. What does the National Scrutiny Plan for Local Government tell us?
Emerging national themes
16. The post-Crerar Policy and Approaches Action Group (PAAG) recommended that ministers should agree strategic priorities and priority risk categories to support a coordinated approach for all new and existing scrutiny. The PAAG also made a recommendation on the priorities for public service scrutiny which was accepted by the Government. We have, therefore, used these national risk priorities to guide the SRA and the decisions on scrutiny activity. 
17. The national risk priorities are:
•	Protection, welfare and access to opportunities for children; adults in need of support and protection; and older people.
•	Assuring public money is being used properly.
18. In light of the timing of the activity, we also made a decision to take into account the effect of the recession as a national risk priority in driving  our work.
19. Each LAN considered and reported on how the national risk priorities are being addressed in each council. We recognise that at this stage in the development of the process, individual LANs may not have taken a consistent approach to examining these areas in terms of the level of analysis of current risks and scrutiny work proposed in future years. We will address this more fully in future; however, we have identified the following emerging themes:
•	The protection of vulnerable people, welfare and access form a key element of councils’ local outcomes and service provision. There is evidence in the AIPs of some variation in the effectiveness of councils’ operations in this area. A significant proportion (70 per cent) of the scrutiny activity planned for 2010/11 is focused on these areas of risk, including the second round of joint child protection inspection as requested by ministers, and much of the work carried out by SWIA and the Care Commission. 
•	Ensuring public money is being used properly is central to the management of local authorities. This is closely linked to the national risk priority we considered relating to the current economic circumstances. Many councils are in the process of developing or implementing transformation programmes in order to ensure they are responding to the economic climate and making best use of public money. The effect of these programmes will become apparent over the next 12 to 18 months and work to follow up on progress is captured in many AIPs.
•	It is clear that while all Scottish councils face significant challenges as a result of tightening financial environment, they have plans in place to manage council funding reductions and to attempt to mitigate the effects on the local economy. The nature of these plans varies across councils and progress will become apparent in the next 12 to 18 months. It will be assessed as part of the annual financial audit and the updated risk assessment.
Effective self-evaluation is central to reduced scrutiny but more work is needed
20. The ability of councils to undertake robust and reliable self-evaluation of the effectiveness of their corporate processes, performance of services and impact on the local area, is central to a reduction in levels of external scrutiny undertaken by all scrutiny bodies. Detailed, accurate, up to date, readily available and verifiable information allows us to more accurately assess risk and target scrutiny activity to where it is most necessary.
21. All councils across Scotland are committed to developing robust self-evaluation arrangements. However, councils themselves recognise that the maturity and effectiveness of self-evaluation is currently under-developed. Even within those councils where self-evaluation is used as an improvement tool, there are inconsistencies in coverage and the quality of information across services, outcome areas and corporate processes. We found that:
•	the completeness and reliability of self-evaluation varies across the 32 councils in Scotland, with some councils having well-developed systems in place and others only beginning to develop a robust system of self-evaluation
•	the completeness and reliability of self-evaluation varies across council services, with more mature approaches in education, where there is a history of self-evaluation being developed in close association with inspection, and less well developed processes in non inspected services such as roads maintenance and planning. Some councils have volunteered to have their self-evaluation processes in education validated through joint activities with HMIE
•	strategic and council wide self-evaluation is less well developed than service level self-evaluation. This is particularly apparent in relation to the strategic use of resources, such as people, property and finance
•	self-evaluation against outcomes tends to be less well developed than corporate and service level self-evaluation
•	the robustness of self-evaluation information is closely linked to the maturity and effectiveness of the council’s performance management systems.
22. Service user views and customer satisfaction information are central aspects of self-evaluation, and represents a significant gap in existing self-evaluation information in many councils. User views and customer satisfaction information is powerful evidence for us in assessing risk and deciding what scrutiny activity is required.
23. About a quarter of scrutiny activity in the Plan arises from uncertainty about risks because of a lack of public, readily available and verifiable information available to us. There is a need for substantial improvements in the quality of self-evaluation processes and information in individual councils and services, in order to achieve further reductions in the amount of scrutiny activity required to provide public assurance.
24. The role of elected members in challenging the processes and outcomes of self-evaluation activities undertaken by councils, is also central to good governance. Effective internal challenge lends further credibility to self-evaluation work and assists us in targeting scrutiny activity to where it is most needed.
Self-evaluation must always be supported by independent challenge to maintain public assurance
25. Self-evaluation is important in reducing and targeting scrutiny but it will not eliminate all scrutiny activity. A degree of challenge of a council’s self-evaluation will always be required to provide strong, independent public assurance. This is particularly the case in services provided for vulnerable service users, where assurance cannot be provided through self-evaluation and desk-based scrutiny activity alone. 
26. There will continue to be a need for independent public assurance. Credible public assurance relies on clear, evidence-based, independent evaluations and accessible public reports. We will continue to review how we achieve this assurance, and we are committed to delivering a scrutiny system for local government in Scotland that is risk-based and proportionate. 
We will continue to work with Scottish Government to further reduce scrutiny
27. About half of the scrutiny activity described in the Plan has been requested by the Scottish Government. Although we have tailored this activity and sought to work in a more collective and coherent way, the LANs have had limited ability to reduce this work significantly. The Scottish Government, therefore, will continue to play an important role in delivering further reductions in scrutiny work by considering how requests for new scrutiny activity can be better assessed and matched to risk. We will continue to work closely with the Scottish Government to ensure that the Systematic Scrutiny Check approach is used to support ministers in decisions on if, where, when and how scrutiny activity is to be applied.

Part 3. Next steps
28. This first year of implementation has been a significant exercise for all the scrutiny bodies involved. It is the first time scrutiny bodies in Scotland have come together in this way. It would not have been possible to achieve the National Scrutiny Plan for Local Government without the fully collaborative nature of the approach.
29. We have undertaken the SRA as one element in a programme of significant change in the scrutiny landscape of Scotland. For example, the Care Commission and SWIA will be replaced by one new body. We believe the SRA approach will provide us with a flexible framework to respond to the changing nature of scrutiny in the future, and will allow us to improve the approach further.
We will continue to evaluate our approach
30. We have undertaken evaluation exercises throughout the development and roll out of the SRA process and the production of the AIPs. We have also commissioned an independent evaluation of the work, which will ask councils and other stakeholders for their feedback. This will help to take stock of the Accounts Commission’s gate-keeping role and coordination work as requested by the Cabinet Secretary for Finance and Sustainable Growth.
We will focus on further streamlining our activity and improving our approach
31. We have achieved a great deal but recognise we have more to do. The scrutiny bodies are developing a revised workplan which will be influenced by the findings of the independent evaluation. However, we are already clear on some key areas for improvement and development:
•	We can make further efficiencies and continue to streamline our activity.
•	We need to reduce the time taken to complete our annual SRA/AIP drafting cycle.
•	We need to embed the Shared Risk Assessment approach more fully in our individual audit and inspection bodies.
•	We need to ensure consistency in delivering a proportionate response to scrutiny risk.
•	We need to ensure consistency in the way the LANs communicate and engage with councils.
•	We need to be more consistent in the way we consider the national risk priorities in individual councils as part of our SRA process.
•	We need to better support improvement by more effectively and consistently identifying and sharing good practice.
•	We need to develop a Plan in future years that is clearer about the rolling programme of planned work for years two and three.
32. Our commitment to further development and improvement of the new approach will be set out in the Local Government Scrutiny Coordination Operational Group Workplan. Underpinning the specific objectives outlined in this workplan, is the need for input from our key stakeholders and our commitment to ongoing engagement.

Appendix 1.
The Local Government Scrutiny Coordination Strategic Group Members 
The Accounts Commission
The Accounts Commission is independent of central and local government. Its role is to examine how Scotland’s 32 councils and 44 joint boards manage their finances; help these bodies manage their resources efficiently and effectively; promote Best Value; and publish information every year about how they perform. The Accounts Commission has powers to report and make recommendations to the organisations it scrutinises, hold hearings and report and make recommendations to Scottish Government ministers. 
Audit Scotland
Audit Scotland is a statutory body set up under the Public Finance and Accountability (Scotland) Act 2000. It provides services to the Accounts Commission and the Auditor General for Scotland (AGS). Working together, the Accounts Commission and Audit Scotland ensure that public sector bodies in Scotland are held to account for the proper, efficient and effective use of public funds. 
Her Majesty’s Inspectorate of Education
Her Majesty’s Inspectorate of Education in Scotland (HMIE) is a Scottish Government executive agency. HMIE aims to promote sustainable improvements in standards, quality and achievements for all learners in a Scottish education system which is inclusive. HMIE works towards the achievement of its aims by providing independent evaluations; providing advice and reports, based on the experiences and achievements of learners and vulnerable children and the provision made for them; working with establishments, services, their partners and other organisations, to increase their capacity to improve through rigorous self-evaluation and well-targeted support; and providing professional advice for Scottish ministers. HMIE currently have responsibility for leading the joint inspections of services to protect children in all 32 local authority areas across Scotland. Provisions in the Public Services Reform (Scotland) Act 2010 will transfer responsibility for child protection inspections from HMIE to a new body, Social Care and Social Work Improvement Scotland (SCSWIS) in April 2011. 
Social Work Inspection Agency2
The Social Work Inspection Agency (SWIA) is a Scottish Government executive agency set up in 2005 under the terms of the Scotland Act 1998. Its strategic objective is to modernise and improve social work services across Scotland. SWIA does this by delivering focused and proportionate national scrutiny that provides assurance, acknowledges good performance in social work services and assists poor performers to improve; working with other scrutiny bodies to deliver integrated inspections; encouraging self-evaluation and improvement by providers of social work services; connecting policy development with practice through a knowledge base derived directly from inspections; and providing professional advice to Scottish ministers. 
Scottish Commission for the Regulation of Care (The Care Commission)3
The Scottish Commission for the Regulation of Care (the Care Commission) is a Non-Departmental Public Body. It was set up to regulate care services for adults and children in Scotland under the Regulation of Care (Scotland) Act 2001. The Care Commission has a statutory duty to regulate care services in order to further improve the quality of care in Scotland. The Care Commission registers care services; inspects all registered services against the National Care Standards; investigates complaints; takes enforcement action when services fail to make required improvements; works with people who use care services and their carers, care service providers, the Scottish Government and other public bodies; promotes improvement of care services while also providing protection for the vulnerable people receiving care; provides information about the availability and quality of care services in Scotland; provides Scottish ministers with evidence and expert advice on the quality of social care; informs social and healthcare policy; and collaborates with other scrutiny bodies on the joint inspection of services for children and vulnerable adults. 
The Scottish Housing Regulator
Scottish Housing Regulator (SHR) is a Scottish Government executive agency. It exercises the regulatory powers of Scottish ministers in the Housing (Scotland) Act 2001. SHR regulates registered social landlords and the landlord and homelessness services of local authorities. Its purpose is to protect the interests of current and future tenants and other service users; ensure the continuing provision of good quality social housing, in terms of decent homes, good services, value for money, and financial viability; and maintain the confidence of funders. SHR registers and regulates independent social landlords. It also inspects the housing and homeless services provided by local authorities. The agency drives improvements in landlords’ efficiency and performance, and help to ensure that registered social landlords continue to attract private finance at competitive rates to build and improve affordable homes. Provisions in the Housing (Scotland) Bill, which was introduced to the Scottish Parliament in January 2010 and currently is being considered by the Parliament, will change the status of SHR from an executive agency to a non-ministerial department. 
Her Majesty’s Inspectorate of Constabulary for Scotland
Her Majesty’s Inspectorate of Constabulary for Scotland (HMICS) operates independently and is responsible for inspecting the eight police forces in Scotland and the five police services provided by the Scottish Police Services Authority (SPSA), in order to improve those services. HMICS does this by inspecting and advising police forces and the services; undertaking a risk-assessed programme of thematic inspections, including working with partners on joint inspection activity; working with the police service in Scotland on driving forward an annual self-assessment programme that promotes continuous improvement; and sharing good practice. HMICS provides public reports and independent advice to ministers, police board members and police forces and services.
NHS Quality Improvement Scotland4
The function of NHS Quality Improvement Scotland (NHS QIS) is to improve the quality of health care in Scotland by setting standards and monitoring performance, and by providing advice, guidance and support to NHSScotland on effective clinical practice and service improvements. The two key aims of the organisation are to report to the public on the performance of NHSScotland against nationally agreed standards, and to support NHSScotland in improving the quality of care and treatment it provides. NHS QIS achieves this by developing and implementing, in partnership with health care professionals and the public, a national framework to determine, share and promote consistent high-quality care across Scotland.

1	Thirty-six per cent reduction in on site contact days. That is the number of days spent in the council multiplied by the number of auditors/inspectors involved in the work.
2.	SWIA and the Care Commission under provisions in the Public Services Reform (Scotland) Act 2010 will be dissolved and their functions transferred to one new body, Social Care and Social Work Improvement Scotland (SCSWIS) in April 2011.
3.	Ibid.
4.	NHS QIS will be dissolved and its functions transferred to Health Improvement Scotland under provisions in the Public Services Reform (Scotland) Act 2010 in April 2011.