1.1 The Scottish Environment Protection Agency ( SEPA) has a vital role in implementing the Scottish Executive's policies on the environment. By providing well managed, integrated environmental protection, it will benefit both the environment and people of Scotland and contribute to the Scottish Ministers' overall aim of sustainable development. SEPA's powers are to be exercised to prevent, minimise or reduce pollution of the environment and on measures that it believes should be taken to protect or enhance it. SEPA will also play an important role in achieving international obligations related to environmental protection.
1.2 SEPA was formed in 1996 with the intention of delivering coherent and integrated environmental protection and a streamlined service to the public and industry.
1.3 The Management Statement
1.3.1 This Management Statement has been drawn up by the Scottish Executive Environment and Rural Affairs Department in consultation with the Scottish Environment Protection Agency, Erskine Court, Castle Business Park, Stirling.
1.3.2 The document sets out the broad framework, within which SEPA will operate, in particular:
- the rules and guidelines relevant to the exercise of SEPA's functions, duties and powers;
- the conditions under which any public funds are paid to SEPA; and
- how SEPA is to be held to account for its performance.
1.3.3 The Management Statement will be reviewed and updated by the Department, normally every 2-3 years but at least every fifth year.
1.3.4 SEPA or the Department may propose amendments to the document at any time. The Department will determine what changes, if any, are to be incorporated. Legislative changes will take precedence over any part of the document. This document will be subject to the approval of the Scottish Ministers.
1.3.5 The Department shall resolve any question regarding the interpretation of the document after consultation with SEPA.
1.3.6 Copies of the document and any subsequent substantive amendments will be placed in the Scottish Parliament Information Centre ( SPICe). Copies will also be made available to members of the public on request.
1.3.7 This document should be read in conjunction with SEPA's Financial Memorandum, which defines the framework of controls on financial, staffing, and related matters for SEPA.
1.3.8 Where responsibilities are assigned to the Department within this document, they will be discharged on behalf of the Scottish Ministers.
1.4 Founding legislation and status of SEPA
1.4.1 SEPA is public body corporate established under the Environment Act 1995. The status and constitution of SEPA is set out in Schedule 6 to the Act.
1.4.2 SEPA does not carry out its functions on behalf of the Crown.
1.5 Classification of SEPA
1.5.1 For administrative purposes SEPA is classified as an executive non-departmental public body ( NDPB).
1.5.2 For national accounts purposes SEPA is classified to the central government sector.
1.5.3 References to SEPA include all its subsidiaries and joint ventures that are classified to the public sector for national accounts purposes. If such a subsidiary or joint venture is created, there shall be a document setting out the arrangements between it and SEPA.
1.6 The functions of SEPA
1.6.1 The Environment Act 1995 sets out the functions of SEPA. Section 21 of the Act sets out the functions transferred from other bodies in the formation of SEPA. Further functions, powers and duties of SEPA are set out in, inter alia, sections 23-45, 48, 51-52 and 92 of the 1995 Act.
1.6.2 Additional functions have been given to SEPA under legislation enacted since the formation of SEPA under the 1995 Act. The status of SEPA's statutory functions set out under relevant legislation will take precedence over any summary included in this Management Statement.
1.6.3 SEPA's main statutory functions include:
- regulate those industrial processes with a significant pollution potential so as to prevent, minimise or render harmless discharges to air, land and water which may be harmful to the environment or human health;
- regulate the disposal of radioactive waste. With the exception of nuclear licensed sites, regulate the keeping and use of radioactive material and accumulation of radioactive waste, with the aim of minimising such waste and preventing harm to the environment or human health;
- regulate the treatment, storage, movement and disposal of waste so as to prevent pollution of the environment or harm to human health;
- register companies with obligations to re-use, recover or recycle packaging waste;
- develop and implement the National Waste Strategy for Scotland;
- take measures to minimise waste, and improve management of waste by encouraging reuse and recycling;
- regulate discharges to controlled waters;
- preserve or improve the quality of freshwaters, ground waters, estuaries, bathing waters and coastal waters, including the preparation of action programmes to bring about such improvement;
- regulate the abstraction of water in sensitive areas designated by control orders;
- preserve or improve air quality through its powers to regulate, prevent or minimise pollution to air;
- bring about remediation of contaminated land that has been designated as a special site, as defined by Part IIA of the Environment Protection Act 1990;
- promote sustainable flood management in the discharge of relevant functions taking full account of any regulations and guidance as may be issued by the Scottish Ministers.
- provide a flood warning system that gives members of the public and emergency services reliable and accurate information on flooding risks in specified areas;
- regulate industrial sites to prevent major accidents and to limit their consequences for man and the environment; and
1.6.4 SEPA also has statutory functions related to obtaining information on the environment, and using this to inform policy and promote an understanding of the importance of its activities. Among these are duties or powers to:
- assemble environmental data, from its own monitoring and others sources, so it can carry out its own functions and also form an overview of the general state of the environment;
- provide advice during the development of policy at Scottish, UK, European and International level as to the effectiveness, practicality, impact and enforcement of proposed legislation;
- carry out monitoring, surveying and reporting as set out in statute, including:
- surveying waste disposal needs and priorities and developing an overview of Scotland's strategic requirements in this area;
- monitoring of radioactive wastes and levels of radioactivity near nuclear and industrial sites;
- reporting from time to time on the state of contaminated land and, where it considers necessary, producing site-specific guidance on dealing with contaminated land;
- monitoring the quality of freshwaters, groundwater, estuaries and the coastal waters (up to three miles from the territorial baseline);
- developing and maintaining Scotland's pollutant release inventory;
- maintaining a detailed knowledge of developments in technology for preventing, minimising, remedying or mitigating the effects of pollution;
- at the request of the Scottish Ministers, assessing environmental impacts of pollution or reporting on options for avoiding, limiting or cleaning up pollution;
- carrying out, promoting or collaborating with others on research related to its regulatory activities;
- making environmental information available to the public and involving communities in decisions that affect their local environment; and
- has procedures in place to ensure SEPA complies with the requirements of the Freedom of Information (Scotland) Act 2002 and the Environmental Information Regulations.
1.6.5 SEPA also has six duties as a Category 1 responder under the Civil Contingencies Act 2004. These duties relate to SEPA's role in emergency planning They are, a duty to co-operate, a duty to assess risk, a duty to plan to perform functions, a duty to plan for an emergency, a duty to warn and inform and a duty to share information
1.6.6 SEPA also has a duty to advise on the state of the environment and on measures for its rotection and enhancement. The Department may, from time to time, provide SEPA with guidance on particular areas where SEPA should direct its efforts in carrying out this duty.
1.6.7 In addition to those functions arising from its statutory responsibilities, SEPA will also be expected to carry out monitoring to support its general regulatory role. Furthermore, each of its main functions requires SEPA to maintain comprehensive registers of information relating to licences or other authorisations, which must be accessible to the public.
1.6.8 SEPA also has general duties which determine the overall manner in which it should carry out its functions:
- to take account of potential costs and benefits of its actions (while at the same time ensuring that it delivers statutory objectives, including SEPA's contribution to those derived from European Union obligations);
- to conduct its activities in ways which have regard to issues of conservation and public access to land and water;
- to further the conservation of biodiversity when exercising its functions; and
- to ensure that its activities are compatible with the statutory guidance on sustainable development concerning SEPA's contribution to sustainable development and environmental justice.
1.6.9 SEPA may be called upon from time to time to provide advice or information to the Scottish Ministers or may be directed by the Scottish Ministers to carry out certain activities.
1.6.10 SEPA should implement environmental regulations in ways that do not impose unnecessary burdens on those that it regulates and are proportionate to the actual or potential harm to the environment. It should seek to ensure that those subject to regulation are clear about its purpose, its requirements and who is responsible for complying with them, and where to obtain information and advice. Charging schemes should be transparent to those they apply to and open to independent, external scrutiny where appropriate.
1.6.11 SEPA's decisions and activities should take account of the Scottish Ministers' view that environmental objectives and targets should be based on sound science and a careful analysis of impacts, risks, costs and benefits.
AIM AND OBJECTIVES
2.1 Overall aim
2.1.1 The Scottish Ministers have defined the following overall aim for SEPA.
To provide an efficient and integrated environmental protection system for Scotland which will both improve the environment and contribute to the Scottish Ministers' goal of sustainable development.
2.2 Key objectives
2.2.1 The Scottish Ministers have approved the following strategic objectives for SEPA:
(a) To adopt an integrated approach to environmental protection and enhancement which considers impacts on all environmental media and on natural resources;
(b) To work with all sectors of society to deliver environmental requirements and goals, without imposing excessive costs (in relation to benefits gained) on regulated organisations and society as a whole;
(c) To adopt clear and effective procedures for serving its customers, including developing single points of contact through which they can deal with SEPA;
(d) To operate to high professional standards, based on sound science, information and analysis of the environment and of processes which affect it;
(e) To organise its activities in ways which reflect good environmental and management practice and provide value for money for taxpayers and those who pay its charges;
(f) To provide clear and readily available advice and information on its work, and to involve the public in environmental protection; and
(g) To develop a close and responsive relationship with the public, local authorities and regulated organisations.
2.2.2 These strategic objectives focus on the way that SEPA should operate and the underpinning principles that it should adopt in carrying out its functions. However, SEPA's performance will be judged primarily on its contribution to protecting and improving Scotland's environment and quality of life. The Sponsor Department, assessing SEPA's performance and activities in the light of the Scottish Ministers' wider strategic aims, will provide SEPA with guidance on relevant policy priorities. These will be set out in the Policy Priorities paper issued to SEPA from time to time by the Sponsor Department. It will be important for SEPA to set its corporate performance objectives in terms that measure the environmental impact of its work and to link these targets to the Scottish Ministers' policy priorities. SEPA's corporate objectives and key targets should be agreed with the Scottish Ministers through the corporate planning process, described at Section 4.
RESPONSIBILITIES AND ACCOUNTABILITIES
3.1 The Scottish Ministers
3.1.1 The Scottish Ministers are ultimately accountable to the Scottish Parliament for the activities and performance of SEPA. Their responsibilities include:
- approving the policy and performance framework within which SEPA will operate, including objective setting (as set out in this Management Statement and the associated Financial Memorandum);
- providing information to the Scottish Parliament about SEPA as required;
- approving the resource budget and the associated grant-in-aid requirements to be paid to SEPA, and securing the necessary Parliamentary approval;
- approving the level of charges to be levied by SEPA;
- carrying out functions specified in the Environment Act 1995 and subsequently devolved to the Scottish Ministers by virtue of the Scotland Act 1998. These include appointments to the main Board, remuneration of members of the main Board and regional Boards, approval of terms and conditions of the Chief Executive, and laying of annual reports and accounts before the Parliament; and
- carrying out of devolved Ministerial functions in relation to SEPA derived from any other legislation.
3.1.2 In accordance with statute, the Scottish Ministers may give SEPA directions with which it must comply, including directions to enable European or International commitments to be met. In general, powers to give a direction are exercisable only after consultation with SEPA.
3.1.3 The Scottish Ministers have powers to call-in applications, determine appeals and set charges in relation to SEPA's regulatory and other functions, where such powers have been devolved to the Scottish Ministers under the Scotland Act 1998.
3.2 The Departmental Accountable Officer
3.2.1 The Head of the sponsor Department is designated as the sponsor Department's Accountable Officer by the Principal Accountable Officer for the Scottish Administration. He/she is responsible for the overall organisation, management and staffing of the sponsor Department and for ensuring that there is a high standard of financial management in the Department as a whole.
3.2.2 In particular the Departmental Accountable Officer shall ensure that:
- SEPA's strategic aims and objectives support the Scottish Ministers wider strategic aims;
- the financial and other management controls applied by the Department to SEPA are appropriate and sufficient to safeguard public funds and for ensuring that SEPA's compliance with those controls is effectively monitored ("public funds" include not only any funds provided to SEPA by the Scottish Ministers but also any other funds falling within the stewardship of SEPA, including income from charging schemes, gifts, bequests and donations);
- the internal controls applied by SEPA conform to the requirements of regularity, propriety and good financial management;
- any funding provided to SEPA is within the scope and the amount authorised by Budget Act .
3.2.3 The responsibilities of a Departmental Accountable Officer are set out in more detail in the Memorandum to Accountable Officers from the Principal Accountable Officer - see Annex 1 of the section on Accountability in the Scottish Public Finance Manual ( SPFM). 3.3 The Sponsoring Team in the Department
3.3.1 Within the Department, the SEPA Sponsorship Team, part of the SEPA Sponsorship and Waste Division, is the sponsoring team for SEPA. This team, in consultation as necessary with the Departmental Accountable Officer, is the primary source of advice to the Scottish Ministers on the discharge of their responsibilities in respect of SEPA, and the primary point of contact for SEPA within the Department. SEPA will also be responsive to requests from other Departments and Divisions of the Scottish Executive. The sponsoring team shall carry out its duties under a senior officer who shall have primary responsibility for overseeing the activities of SEPA.
3.3.2 The sponsoring team shall advise the Scottish Ministers on:
- an appropriate framework of objectives and targets for SEPA in the light of the Scottish Ministers wider strategic aim[s];
- an appropriate allocation of resources for SEPA in the light of the Scottish Ministers overall public expenditure priorities, policy priorities and resource requirements to allow SEPA to fulfil its statutory and other duties; and
- how well SEPA is achieving its strategic objectives, whether it is delivering value for money, and SEPA's contribution to the Efficient Government initiative.
3.3.3 In support of the Departmental Accountable Officer the sponsoring team shall:
on performance and risk management -
- monitor SEPA's activities on a continuing basis through an adequate and timely flow of information from SEPA on performance, budgeting, control and risk management, including early sight of SEPA's Statement on Internal Control;
- address in a timely manner any significant problems arising in SEPA, whether financial or otherwise, and to take action where appropriate;
- ensure that the activities of SEPA and the risks associated with them are properly and appropriately taken into account in the Scottish Executive's risk assessment and management systems; and
- ensure that appointments to the Board are made timeously and in accordance with the Commissioner for Public Appointments in Scotland's Code of Conduct.
on communication with SEPA -
- inform SEPA of relevant Scottish Executive policy in a timely manner; advise on the interpretation of that policy; and issue specific guidance to SEPA as necessary; and
- bring concerns about the activities of SEPA to the attention of the Chief Executive or Chair, and require explanations and assurances that appropriate action has been taken.
3.4 The Chair of SEPA
3.4.1 The Chair of SEPA will be appointed by the Scottish Ministers. The appointment and it's duration will be determined by the Scottish Ministers and will be made in line with the Code of Practice issued by the Commissioner for Public Appointments in Scotland.
3.4.2 The Chair is personally responsible to the Scottish Ministers. The Chair shall aim to ensure that SEPA's policies and actions support the wider strategic policies of the Scottish Ministers; and that SEPA's affairs are conducted with probity. The Chair shares with other Board members the corporate responsibilities set out in paragraph 3.5.2, and in particular for ensuring that SEPA fulfils the aims and objectives set by the Scottish Ministers.
3.4.3 The Chair has a particular responsibility for providing effective strategic leadership on the following matters in particular:
- formulating the Board's strategy for discharging its statutory duties;
- encouraging high standards of propriety and promoting the efficient and effective use of staff and other resources throughout SEPA;
- ensuring that the Board, in reaching decisions, takes proper account of guidance provided by the responsible Ministers; and
- representing the views of the Board to the general public.
3.4.4 The Chair shall also:
- ensure that all members of the Board, when taking up office, are fully briefed on the terms of their appointment and on their duties, rights and responsibilities, and receive appropriate induction training, including financial management and reporting requirements of public sector bodies and on any differences which may exist between private and public sector practice;
- advise the Scottish Ministers of the needs of SEPA when Board vacancies arise, with a view to ensuring a proper balance of professional and financial expertise; and
- assess the performance of individual Board members and the Chief Executive on an annual basis.
3.4.5 The Chair shall also ensure that Board Members are fully aware of SEPA's Code of Conduct as approved by the Scottish Ministers.
3.4.6 Communications between the Board and the Scottish Ministers shall normally be through the Chair. The Chair shall ensure that the other Board members are kept informed of such communications.
3.5 The Board of SEPA
3.5.1 Legally, the Board constitutes SEPA. It must comprise at least 8 Members, but not more than 12, each appointed by the Scottish Ministers. The selection of Board Members will be in accordance with criteria laid down by the Scottish Ministers. As well as appointing the Chair of SEPA, the Scottish Ministers will appoint a Member as Deputy Chair.
3.5.2 The Board has corporate responsibility for ensuring that SEPA fulfils the aim and objectives set by the Scottish Ministers and for promoting the efficient and effective use of staff and other resources by SEPA in accordance with the principles of Best Value - see relevant section of the SPFM. To this end, and in pursuit of its wider corporate responsibilities, the Board shall:
- demonstrate high standards of corporate governance at all times, including by setting up and using a remuneration committee and an independent audit committee - in accordance with the guidance on Audit Committees in the SPFM - to help the Board to address the key financial and other risks facing SEPA;
- establish the overall strategic direction of the organisation within the policy, planning and resources framework determined by the Scottish Ministers;
- monitor the performance of the organisation against key objectives agreed with Ministers and taking measures to correct any shortfalls in performance;
- ensure that any statutory or administrative requirements for the use of public funds ( i.e. all funds falling within the stewardship of SEPA) are complied with; that the Board operates within the limits of its statutory authority and any delegated authority agreed with the sponsor Department, and in accordance with any other conditions relating to the use of public funds; and that, in reaching decisions, the Board takes into account relevant guidance issued by the Scottish Ministers / sponsor Department;
- ensure that, in reaching decisions, the Board takes into account any guidance issued by the Scottish Ministers;
- appoint, with the Scottish Ministers' approval, a Chief Executive, to whom they will delegate day-to-day management of SEPA.
- ensure that the Scottish Ministers are kept informed of any changes which are likely to impact on the strategic direction of SEPA or on the attainability of its targets, and determine the steps needed to deal with such changes;
- ensure that the Board receives and reviews regular financial information concerning the management of SEPA; is informed in a timely manner about any concerns about the activities of SEPA; and provides positive assurance to the Department that appropriate action has been taken on such concerns;
- provide commitment and leadership in the development and promotion of Best Value principles throughout the organisation; and
- in liaison with the Chair, set performance objectives and remuneration terms, linked to the Scottish Ministers' objectives, for the Chief Executive which give due weight both to the proper management and use of public monies and to the delivery of outcomes in line with Scottish Ministers' priorities.
3.5.3 Individual Board members shall act in accordance with their wider responsibility as Members of the Board - namely to:
- comply at all times with the Code of Conduct, as approved by the Scottish Ministers, that is adopted by SEPA and with the rules relating to the use of public funds, conflicts of interest and confidentiality;
- not misuse information gained in the course of their public service for personal gain or for political profit, nor seek to use the opportunity of public service to promote their private interests or those of connected persons or organisations;
- comply with the Code of Conduct, the Board's rules on the acceptance of gifts and hospitality, and of business appointments; and
- act in good faith and in the best interests of SEPA.
3.5.4 SEPA should maintain a list of matters that are reserved for the Board's decision. The list should be agreed with the Department.
3.5.5 Members of the Board (including the Chair) must not give the Chief Executive instructions which conflict with the latter's duties as SEPA's Accountable Officer (as required under Section 15 (8) of the Public Finance and Accountability (Scotland) Act 2000).
3.5.6 In accordance with the requirements of the Environment Act 1995, SEPA has established, and will maintain, Regional Boards which provide a means for it to take account of local knowledge and concerns; and to which responsibilities may be delegated by the main Board, subject to the Scottish Ministers' approval. The precise boundaries of the Regional Boards are for SEPA to determine.
3.6 SEPA's Accountable Officer
3.6.1 The Chief Executive of SEPA is designated as SEPA's Accountable Officer by the Principal Accountable Officer in accordance with sections 14 and 15 of the Public Finance and Accountability (Scotland) Act 2000.
3.6.2 The Chief Executive will be appointed by the Board following open competition. As well as approving such appointments, the Scottish Ministers will also appoint the Chief Executive to SEPA's Board.
3.6.3 As SEPA's Accountable Officer, the Chief Executive is personally responsible for safeguarding the public funds ( i.e. all funds, including income from charging schemes, falling within the stewardship of SEPA) for which he / she has charge; for ensuring propriety and regularity in the handling of those public funds; and for the day-to-day operations and management of SEPA. He / she should act in accordance with the terms of this document and associated Financial Memorandum and within the terms of relevant guidance in the Scottish Public Finance Manual and other instructions and guidance issued from time to time by the Scottish Ministers - in particular, the Memorandum to Accountable Officers of Other Public Bodies which the Chief Executive will receive on appointment.
3.6.4 As SEPA's Accountable Officer, the Chief Executive has a duty to secure Best Value, which includes the concepts of good corporate governance, performance management and continuous improvement. Guidance to Accountable Officers on what their organisations should be able to demonstrate in fulfilment of the duties which make up a Best Value regime is included in the Best Value section of the SPFM.
3.6.5 The Chief Executive shall also ensure that SEPA complies with the requirements set out in the Financial Memorandum. In addition, the Chief Executive shall exercise the following specific responsibilities:
on planning, performance management and monitoring -
- establish SEPA's corporate and business plans in the light of the Scottish Ministers wider strategic aims;
- establish a robust performance management framework which supports the achievement of SEPA's aims and objectives as set out in the corporate and business plans; and which enables full performance reporting to the Board, the Department and the wider public;
- inform the Department of SEPA's progress in helping to achieve the Scottish Ministers policy objectives and in demonstrating how resources are being used to achieve those objectives; and
- ensure that timely forecasts and monitoring information on performance and finance are provided to the Department; that the Department is notified promptly if overspends / underspends are likely or if performance targets are at serious risk and that corrective action is taken; and that any significant problems, whether financial or otherwise, and whether detected by internal audit or by other means, are notified to the Department in a timely fashion.
on advising the Board -
- advise the Board on the discharge of its responsibilities as set out in this document, in the founding legislation and in any other relevant instructions and guidance issued by the Scottish Ministers / Sponsor Department;
- advise the Board on SEPA's performance compared with its aim and objectives;
- ensure that financial considerations are taken fully into account by the Board at all stages in reaching and executing its decisions, and that standard financial appraisal techniques as set out in the Green Book are followed as far as this is appropriate and practical; and
- take action as set out in section 5 of the Memorandum to Accountable Officers of Other Public Bodies if the Board, or its Chair, is contemplating a course of action involving a transaction which the Chief Executive considers would infringe the requirements of propriety or regularity or does not represent prudent or economical administration or efficiency or effectiveness.
on managing risk and resources -
- ensure that a system of risk management is embedded in the organisation to inform decisions on financial and operational planning and to assist in achieving objectives and targets;
- ensure that an effective system of programme and project management and contract management is maintained;
- ensure that the funds made available to SEPA including any income from charging schemes or any other approved income or receipts are used for the purpose intended by the Parliament, and that such moneys, together with SEPA's assets, equipment and staff, are used economically, efficiently and effectively;
- ensure that adequate internal management and financial controls are maintained by SEPA, including effective measures against fraud and theft;
- maintain a comprehensive system of internal delegated authorities which are notified to all staff, together with a system for regularly reviewing compliance with these delegations; and
- ensure that effective human resource management policies are maintained and that strategic human resource planning is related to SEPA's objectives.
on accounting for SEPA's activities -
- sign the accounts and be responsible for ensuring that proper records are kept relating to the accounts and that the accounts are properly prepared and presented in accordance with any directions issued by the Scottish Ministers;
- sign a Statement of Accountable Officer's responsibilities, for inclusion in the annual report and accounts;
- sign a Statement on Internal Control regarding SEPA's system of internal control, for inclusion in the annual report and accounts;
- sign a Certificate of Assurance on the maintenance and review of SEPA's internal control systems, for submission to the Department;
- ensure that an effective complaints procedure is in place including, where applicable, reference to the Scottish Public Services Ombudsman and made widely known; and
- give evidence when summoned before Committees of the Scottish Parliament on the use and stewardship of public funds by SEPA.
3.6.6 The Chief Executive is responsible for informing the Departmental Accountable Officer about any complaints concerning SEPA accepted by the Scottish Public Services Ombudsman for investigation, and about SEPA's proposed response to any subsequent recommendations from the Ombudsman.
PLANNING, BUDGETING AND CONTROL
4.1 The Corporate Plan
4.1.1 SEPA will submit to the Department a draft corporate plan. The timetable for preparation of the plan and the period covered should be agreed with the Scottish Ministers.
4.1.2 The plan will reflect SEPA's statutory functions. In line with paragraph 2.2.2, objectives and targets shall be directed at achievement of environmental outcomes and the policies and priorities set by the Scottish Ministers.
4.1.3 The corporate plan will set out:
- SEPA's key objectives and associated key performance targets for years 1 to 3 of the plan based on an assessment of recent performance;
- indicative longer term targets (the time period depending on suitable timeframe for the particular outcome);
- its strategy for achieving these targets and objectives;
- a forecast of expenditure and income (from all sources) taking account of guidance on resource assumptions and policies provided by the Department;
- alternative scenarios and estimates to take account of factors which may significantly affect the achievement of SEPA's objectives; and
- other matters as agreed between the Department and SEPA.
4.1.4 The main elements of the plan, including the key performance targets, will be agreed between the Department and SEPA, in light of the sponsor Department's decisions on policy and resources taken in the context of the Scottish Ministers' wider public expenditure plans and decisions.
4.2 Publication of plans
4.2.1 SEPA shall publish its corporate plan. The Scottish Executive may issue general guidance to SEPA on the presentation of corporate plans.
4.3 Reporting performance against key targets
4.3.1 SEPA will operate management information and accounting systems which enable it to review in a timely and effective manner its financial and non-financial performance against the agreed budgets and targets set out in its corporate and business/operating plans.
4.3.2 SEPA's performance against key targets will be formally reported to the Department in SEPA's annual report and accounts (see Section 5.1). Other forms of reporting performance to the public should also be considered.
4.3.3 SEPA shall take the initiative in informing the Department of changes in external conditions which make the achievement of objectives more or less difficult, or which may require a change to the budget or objectives set out in the corporate or business/operating plans.
4.3.4 SEPA's performance in helping to deliver Ministers' policies, including the achievement of agreed key objectives, shall be reported to the Department on a quarterly basis. Performance will be reviewed regularly by officials of the Department. The appropriate Scottish Minister shall meet the Board formally each year to discuss SEPA's performance, its current and future activities and any policy developments relevant to those activities.
4.4 Budgeting procedures
4.4.1 SEPA's budgeting arrangements are set out in the associated Financial Memorandum, the terms of which must be observed by SEPA.
4.5 Internal audit
4.5.1 SEPA will establish and maintain arrangements for internal audit in accordance with the Financial Memorandum and with the Treasury's Government Internal Audit Standards ( GIAS). SEPA shall consult the Department to ensure that the latter is satisfied with the competence and qualifications of the Head of Internal Audit and the requirements for approving appointment.
4.5.2 SEPA shall arrange for periodic quality reviews of its internal audit in accordance with the GIAS. The Department shall consider whether it can rely on these reviews to provide assurance on the quality of internal audit. However, the Department reserves a right of access to carry out / commission independent reviews of internal audit in SEPA.
4.5.3 The Department's internal audit service shall also have a right of access to all documents prepared by SEPA's internal auditor, including where the service is contracted out. The audit strategy, periodic audit plans and annual audit report, including SEPA's Head of Internal Audit's opinion on risk management, control and governance shall be forwarded, on request, without delay to the sponsoring team who shall consult the Scottish Executive's Head of Internal Audit as appropriate.
4.5.4 In addition, SEPA shall forward to the Department an annual report on any fraud and theft suffered by SEPA; notify any unusual or major incidents as soon as possible; and notify any changes to its internal audit's terms of reference, its audit committee's terms of reference or its Fraud Policy and Fraud Response Plan.
5.1 The annual report and accounts
5.1.1 Within 9 months of the end of each financial year, SEPA shall publish an annual report of its activities and achievements, together with its audited annual accounts and any report of the auditor on these accounts. The annual report will also cover the activities of any corporate bodies under control of SEPA.
5.1.2 The annual report and accounts will comply, so far as appropriate, with the accounting and disclosure requirements given in the Scottish Public Finance Manual and the Financial Reporting Manual ( FReM), as amended or augmented from time to time.
5.1.3 The report and accounts will outline SEPA's main activities and performance during the previous financial year. The report of performance will focus on the outcome of SEPA's activities in terms of environmental protection and improvement and report performance against key objectives and associated key performance targets agreed with the Department. The report will also set out, in summary form, SEPA's forward plans for addressing any areas where shortfalls against targets have been recorded.
5.1.4 The accounts must be prepared in accordance with the relevant statutes, the specific Accounts Direction issued by the Scottish Ministers and any other relevant guidance which the Scottish Ministers may issue from time to time in respect of accounts. The Accounts Direction will specify the form and content of the accounts, the information to be contained in the statements, the manner in which the information is to be presented, and the principles according to which the statements are to be prepared. Information on performance against key financial targets set in the Corporate Plan will be included in the notes to the accounts, and will therefore be within the scope of the audit.
5.1.5 The report and accounts shall be submitted in draft to the Department for comment and the final version shall be laid before the Parliament by the Scottish Ministers before 31 December. The accounts must not be laid before they have been formally sent by the Auditor General to the Scottish Ministers. The annual report and accounts must not be published before they have been laid before Parliament. SEPA shall be responsible for the publication of the report and accounts.
5.2 External audit
5.2.1 The Auditor General for Scotland ( AGS) audits, or appoints auditors to audit, SEPA's annual accounts and passes them to the Scottish Ministers who shall lay them before the Parliament, together with SEPA's annual report. For the purpose of audit the AGS has a statutory right of access to documents and information held by relevant persons specified by an Order under section 24 of the Public Finance and Accountability (Scotland) Act 2000.
5.2.2 SEPA will instruct its auditors to send copies of all management letters and correspondence relating to those letters to the Departmental Accountable Officer, to whom SEPA's replies should also be copied.
5.3 VFM / 3E examinations
5.3.1 The Public Finance and Accountability (Scotland) Act 2000 provides that the AGS may carry out examinations into the economy, efficiency and effectiveness with which SEPA has used its resources in discharging its functions. For the purpose of these examinations the AGS has statutory access to documents and information held by relevant persons specified by an Order made under section 24 of that Act.
6.1 Recruitment, retention and motivation
6.1.1 Within the arrangements approved by the Scottish Ministers, or set out in SEPA's founding legislation, SEPA will have responsibility for the recruitment, retention and motivation of its staff. To this end, SEPA will ensure that:
- the recruitment of staff is based on fair and open competition and equal opportunities;
- the level and structure of its staffing, including gradings and numbers of staff, is appropriate to its functions and the requirements of efficiency, effectiveness and economy;
- the performance of staff at all levels is managed effectively and efficiently; they are satisfactorily appraised annually; and SEPA's performance appraisal and promotion systems are reviewed at least every 5 years;
- its staff are encouraged to acquire the appropriate professional, management and other expertise necessary to achieve SEPA's objectives;
- proper consultation with staff takes place on key issues affecting them;
- staff are treated equitably irrespective of race, religion, gender or disability;
- adequate grievance and disciplinary procedures are in place;
- whistleblowing procedures consistent with the Public Interest Disclosure Act are in place; and
- a code of conduct for staff is in place based on the document Model Code for Staff of Executive Non-Departmental Public Bodies.
6.2 Chair and Board Members
6.2.1 The Chief Executive will also be responsible for putting supporting arrangements in place for the Chair and Board Members, once they have been appointed by the Scottish Ministers. As a minimum, this should include:
- an assessment of training needs for the Chair and Board Members on appointment and periodically during their term of appointment; and
- provision of training specifically required to allow Members to properly fulfil their role in SEPA.
6.2.2 The Chair will be responsible for putting the following arrangements in place:
- annual assessment of Board Members' performance; and
- mechanisms for feeding back performance assessments to the individuals concerned.
6.2.3 The Chair will also be responsible for ensuring that SEPA's Code of Conduct for Members encompasses the requirements of the Ethical Standards in Public Life etc (Scotland) 2000. SEPA have a Standards Officer, who reports back on these matters to the Chair.
INTERNAL AND EXTERNAL RELATIONS
7.1.1 SEPA should meet the standards of openness and transparency expected of public bodies. It has published, and should abide by, its own Code of Practice for Openness. In particular, the SEPA Board should conduct its business in public wherever possible and make minutes of Board meetings publicly available.
7.1.2 SEPA is required to comply with legislation requiring it to maintain public registers of information relating to licences or other authorisations for activities, which it regulates. Suitable public access must be provided to such registers. SEPA must also comply with statutory requirements to report environmental data to public authorities and respond appropriately to members of the public requesting information on the environment.
7.1.3 Beyond these general provisions, SEPA will have more specific relationships. Some will be defined in statute or required by the Scottish Ministers; others will be on a voluntary basis. Both categories will be important in ensuring that SEPA is responsive to those with whom it deals, that it can receive or give advice, and that responsibilities are understood and co-ordinated. In some cases this will involve a memorandum of understanding (MoU) with another body.
7.1.4 Whenever it is appropriate to do so, the Scottish Ministers will refer enquiries and representations from Members of the Scottish Parliament and others about the discharge of SEPA's responsibilities to its Chair or Chief Executive, who must keep the Scottish Ministers and, where appropriate, the Scottish Parliament, informed of action taken in such cases. This should include providing copies of correspondence and other relevant documents to the Department for information.
7.2 Liaison between SEPA and the Scottish Executive
7.2.1 The Scottish Executive and SEPA should both expect to benefit from liaison arrangements based on a key principle of "no surprises". Both will endeavour to ensure they inform each other of relevant developments in advance of any announcements or statements to the media.
7.2.2 The Press Team within the Scottish Executive Environment and Rural Affairs Department ( ERAD) and the Communications Department within SEPA, will co-ordinate the provision of information to the media from within their respective organisations.
7.2.3 Where the Environment Group and SEPA publish reports or submit written evidence to a third party, for example, Committees of the Scottish Parliament, copies of the reports and evidence which impact on the other partner will be shared in advance of being made available more generally.
7.3 Regulated persons
7.3.1 The Scottish Ministers expect SEPA to implement environmental regulation in ways which deliver environmental objectives while not imposing unnecessary burdens on those it regulates. To do so, SEPA should seek constructive relationships with regulated persons (or bodies whose business activities are otherwise affected by its work) and their representatives. This includes Scottish Water. SEPA's service should include provision of information and advice on the regulations which it implements; including its approach to enforcement and what those regulated should do to comply with requirements.
7.3.2 SEPA has two documents in place which set out the principles underpinning its regulatory responsibilities: "Vision for Regulation- Principles for Regulation" and "Service Standards for Regulated Persons". SEPA also has an enforcement policy to underpin enforcement decisions. SEPA should review these documents from time to time to ensure that they continue to uphold the principles of regulatory fairness, proportionality, transparency and consistency of enforcement whilst enabling SEPA to maintain effective environmental protection and take immediate enforcement action where this is justified.
7.3.3 SEPA should ensure that its staff are aware of the regulatory documents and take account of them in their work. It will ensure that these documents are available to all interested parties. It should monitor compliance with these documents, and have arrangements for reviewing complaints of non-compliance.
7.4 Other enforcement agencies
7.4.1 SEPA should liaise with other enforcement agencies to minimise and, if possible, eliminate duplication and conflict in applying legislation, guidance and standards. It should establish effective working relationships with other enforcement agencies, including with local authorities on matters relating to local air quality, contaminated land and environmental health. To this end, SEPA should continue to agree a memorandum of understanding with other enforcement agencies where appropriate, including the Health and Safety Executive. Where there are overlapping responsibilities, SEPA should not take action, including the making of public statements, without first consulting the other bodies, other than in exceptional circumstances such as an emergency where consultation is temporarily impracticable.
7.5 Bodies dealing with emergencies
7.5.1 SEPA should liaise and establish effective working relationships with other bodies dealing with accidents and emergencies, including those responsible for emergency planning in central and local government, waste collection and disposal authorities and the emergency services (see para 1.6.5 and Civil Contingencies Act 2004). It should agree memoranda of understanding with such bodies where appropriate.
7.5.2 SEPA shall have plans in place for liaising with other organisations in the event of an emergency, including a clear definition of responsibilities and specific actions that need to be taken in response to different types of incident. SEPA shall regularly participate in emergency exercises that are relevant to its role.
7.5.3 In crisis or emergency situations, SEPA shall be proactive in providing such support to other public bodies and agencies as may reasonably be considered to fall within its broad environmental protection remit. Where such action impacts on SEPA's planned regulatory activities, SEPA should inform the Department immediately.
7.6 Local relationships
7.6.1 SEPA will also need to liaise with local authorities to cover areas such as planning and development control. For example, SEPA must consult planning authorities before carrying out a national survey of wastes, and has certain statutory duties to consult them on matters related to its regulatory duties. SEPA will be a statutory consultee on development plans drawn up by planning authorities and on issues associated with local air quality management. SEPA will also provide guidance to planning authorities on flooding risks, as specified in statute.
7.6.2 SEPA will be proactive in supporting Community Planning initiatives where these involve environmental matters that come under SEPA's remit.
7.7 Other public bodies
7.7.1 SEPA should liaise with the Environment Agency for England and Wales and with the Northern Ireland Environment and Heritage Service to co-ordinate research activities and to promote consistent standards of environmental protection, regulation and management. This shall not preclude the ability to pursue different approaches in Scotland where that is justified.
7.8 European and international public bodies
7.8.1 SEPA has an important role in implementing EU Directives in Scotland. There is therefore benefit to be gained from SEPA drawing on its technical expertise and regulatory experience to assist the Scottish Executive in influencing development of EU environmental policies and strategies. A co-ordinated policy approach is essential to ensure delivery of the best results for the UK and Scotland in negotiations with EU institutions. The aim of SEPA's relationship with the EU should be to support the Scottish Executive in promoting and influencing policies to ensure they are practical, enforceable and right for Scotland. SEPA should also maintain a close liaison with other European public bodies involved in environmental regulation and enforcement, such as the European Environment Agency ( EEA), the Organisation for the Implementation and Enforcement of EU Environmental Law ( IMPEL) and other national and international environmental protection agencies.
7.8.2 A general consent will be granted to SEPA under section 37(4) of the Environment Act 1995 to allow SEPA to liaise with, and provide advice to, the EC and other organisations mentioned in 7.9.1 below. Such consent will be granted on the basis of compliance with the following principles:
- SEPA shall give reasonable notice to the Executive, and other appropriate bodies, of its intention to visit an individual, institution or body outside the UK, together with an outline of the visit. Appropriate bodies shall include UKRep for all EU contacts, and the relevant British Embassy;
- SEPA will provide a feedback report on such visits to the Scottish Executive within a reasonable timeframe; and
- SEPA shall ensure it is aware of, and always respects, the UK policy line in discussions and written communications with individuals, institutions and bodies outside the UK, and will follow such guidance and instructions as may be provided by the Executive where asked to represent the Scottish Executive.
7.8.3 These conditions shall not apply to routine attendance at conferences and seminars by staff below Director level, where matters of policy are not going to be discussed or where SEPA attendance is part of a strategy agreed with the Scottish Executive. All overseas visits should require approval at an appropriate level of management within SEPA.
7.9 Other Organisations
7.9.1 Other bodies with which SEPA should maintain links include:
- Scottish Natural Heritage;
- Scottish Enterprise and Highlands and Islands Enterprise;
- other departments of the Scottish Executive, for example the Health Department, where issues of human health arise;
- the Department of Environment, Food and Rural Affairs and Maritime and Coastguard Agency on marine pollution issues;
- other UK Government Departments;
- industry and trade bodies;
- Health Boards with regard to their interests in public health and the Scottish Centre for Infection and Environmental Health;
- Non-Governmental Organisations concerned with the environment; and
- the general public.
REVIEWING THE ROLE OF SEPA
8.1 The role of SEPA will be reviewed periodically in accordance with the business needs of the Scottish Executive and of SEPA, normally at least every 5 years.