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measuring Scotland's progress towards A SMART, SUCCESSFUL SCOTLAND
joint performance team
introduction
1 Smart, Successful Scotland, published in January 2001, set out the Scottish Executive's strategic direction for the Enterprise Networks. It built on the policy commitments already made in the Programme for Government and the Framework for Economic Development in Scotland and was designed to provide direction and focus for the Enterprise Networks' activities. Smart, Successful Scotland identified three key themes and twelve specific priority areas for economic development in Scotland. These themes and priority areas are closely inter-related, with progress in one area contributing to, and reinforcing progress in other areas.
2 At the same time, Ministers decided that a new Joint Performance Team (JPT) should be established with members drawn from the Executive and the Enterprise Networks. The Joint Performance Team was assigned the initial task of developing measures to monitor progress towards achieving the ambitions for the Scottish economy identified in Smart, Successful Scotland. In March 2002, the Joint Performance Team published its first report on Measuring Scotland's progress towards a Smart, Successful Scotland, after extensive consultation in autumn 2001 on the appropriate progress measures to be employed. The approach adopted by the Joint Performance Team was to develop progress measures for each of the 12 priority areas identified in Smart, Successful Scotland. These measures are a combination of:
- Measures that describe what a smart, successful Scotland would look like and allow progress towards it to be tracked, e.g. the gap in unemployment between the worst performing areas and the Scottish average.
- Measures which indicate the extent to which the necessary conditions for a smart, successful Scotland are in place, e.g. the cost and geographic coverage of broadband.
3 For each of the 12 priority areas in Smart, Successful Scotland the Joint Performance Team developed one lead measure and two supporting measures. The lead measure is intended to meet three main requirements. It should be an appropriate overall measure of progress; it should provide the right strategic steer to the Networks and it should be capable of relatively straightforward international comparison. The supporting measures are intended to provide a more rounded picture of progress to avoid the potentially distorting effects of too narrow a focus.
4 The progress measures are intended to add to the strategic direction of Smart, Successful Scotland in guiding the activities to promote the economic development of Scotland in the medium to longer term (3 to 10 years). The progress measures are not intended to be operating (output) targets for the Networks. However, the specific operating targets employed by the Networks to direct annual performance are chosen so that they contribute to progress measures. The activities planned for any individual year therefore link to longer-term ambitions and changes in the Scottish economy.
5 This report tells us how Scotland is performing. It does not, of itself, tell us the contribution that Scottish Enterprise and Highlands and Islands Enterprise are making to that performance. That needs to be assessed through evaluation of programmes and projects. The Joint Performance Team is also responsible for agreeing priorities for such evaluation and for ensuring that lessons of evaluation are taken on board. Through effective evaluation, the Joint Performance Team aims to ensure that there can be understanding of the relationship between outputs of the delivery agencies and aspects of economic performance. This will allow decisions as to whether strategic direction needs to be amended or whether, within the strategic direction, different sorts of programmes and projects are required. This report is therefore part of an approach of evidence-based policy making.
6 The Fraser of Allander Institute carried out supporting work for the first report. In this report we have decided to separate out more clearly the analysis of performance, which was carried out by the Fraser of Allander Institute, and commentary from the Joint Performance Team.
7 The intention is that such reports should be prepared and made available on a regular basis so that trends can be identified and interpreted - and inform action where appropriate. From 2004, the report will issue in the autumn so that it issues at the same time of year as the Enterprise Networks' Annual Reports.
THE APPROACH TO MEASUREMENT
8 Scotland's relative economic performance in an international context is the best measure of progress. The Joint Performance Team's objective is to benchmark Scotland's performance against the 30 member countries of the OECD. The aim is to improve performance and move towards the top quartile for each of the twelve priority areas, i.e. to aspire to "world class performance". The timescale over which such an aspiration may be achieved will vary across the proposed measures, determined to a large extent by where we start from. In some of the priority areas, this aspiration may only be achievable over a long period of time but in other areas we may aspire to "world class performance" in the short term. Our aspirations have to be set in the context of what the best in the world are able to achieve and what, realistically, we can expect to attain.
9 The availability of appropriate data to measure progress in each of the priority areas is of crucial importance to this exercise. When this approach was designed, it was recognised that, for some of the indicators at that time, there was not a complete set of data for Scotland and for all the 30 OECD economies. The implementation of the approach was therefore envisaged as being dynamic, with more work required in the future to discover other appropriate data sources - if such exist - and, in the case of Scotland, to compile the fundamental statistics.
10 In presenting the core of this report, the Fraser of Allander Institute comment on the present availability and suitability of data sources. For many of the measures the availability of comparable data makes performance against the proposed OECD benchmarks relatively straightforward to measure. For other measures, where data to establish a benchmark are not readily available, the Fraser of Allander Institute has had to make a practical judgement constrained by limited data sources.
11 Where there are deficiencies in data the JPT is committed to improving availability in so far as that is within the ability of the Scottish Executive and the Enterprise Networks. This year's report highlights that, for a small number of indicators, no easily accessible internationally comparable data exists and work will continue over the coming year to identify potential new sources. For example, Scotland has been invited to become a partner region in the 2004 IMD (Institute for Management Development) World Competitiveness Yearbook which will provide international data for a range of economic indicators. While access to such international comparisons is the key issue there will also be benefits from proposed actions to improve Scottish data and comparator data for the UK.
12 Scottish Executive economic statisticians are planning several developments in statistical outputs in the coming year. Among the more significant is the boost to the Labour Force Survey for Scotland which will result in bigger samples for Scotland allowing more detailed analysis of characteristics within the labour market for smaller geographic areas. The Scottish Executive will also be working closely with the Office for National Statistics to improve the quality of Regional Accounts data, with a view to harmonising the outputs for Scotland in the longer term.
13 It should be noted that all of the datasets in this publication are already in the public domain. Some of the information, although the latest available, pre-dates the publication of Smart, Successful Scotland in July 2001.
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