7.1 What is the efficiency improvement? How will the efficiencies be made? These fall into 5 categories covering each NDPB, ESF and in-house grant schemes. Scottish Enterprise - Restructuring plan announced by Ministers in September 2007 will realise circa £8m in staffing/accommodation costs in 2008/09; increasing to circa £10m per annum with effect from 2009/10. Highlands and Islands Enterprise - Highlands and Islands Enterprise (HIE) has undertaken an organisational restructure to ensure the organisation better reflected its new focus to improve service delivery. A selective voluntary severance (SVS) action was undertaken by 31/3/08. The annual paybill savings results from this will be over £2.1 million. - Reduction in spend on staff business travel elements
- Reduction in spend on office accommodation
- Reduce/eliminate invoices from ad hoc facilities procurement
- Reduction in spend on sundry office supplies
How will the efficiencies be made? - Increased use of e-procurement with embedded visa/GPC
- Increased selective use of on-line purchase of air travel visa/GPC
- Contract for supply of hire car with improved rates
- Revision of staff travel policy and tighter staff e-claims process
- Reduction in staff office space occupied and termination of leases
Sharing HIE's office space with others (recovery of rent/rates) These will realise £0.230 p.a. Visit Scotland Savings are in the range of £1.2m to £1.76m for each year in addition to efficiency savings of £1m a year from earlier efficiency exercises. This is made up of: - Restructuring of the organisation on functional basis with a focus on both tourism businesses and visitors as customers and a reduction in Directorates will release between £0.5m and £1m each year;
- Property savings from sharing offices with other agencies and reorganising Tourist Information Centres etc will provide savings of £0.25m a year; and
- Savings from improvements in procurement both internally and through central procurement initiatives of £0.47m a year.
These savings were built in to the results of SR2007, i.e. VisitScotland had its grant in aid over the SR period reduced by £1m a year in 09-10 and 10-11, and the further efficiencies it plans to make will be needed to cover that reduction. That was made clear when VisitScotland were informally notified of the outcome of the Spending Review. As a proportion of the VisitScotland overall operating budget (i.e. ignoring capital, funding provided for direct Ryder Cup projects costs) these savings amount to between 2.2% to 3.4% (in year savings fro 2008-09) and 3.1% to 4.4% in future years. ESF: The principal efficiency savings is the reduction in the number of external delivery bodies administering Structural Funds programmes. For 2000-06, 5 organisations - called Programme Management Executives (PMEs) - were required. Given the fewer number of programmes and smaller total allocation of funding for 2007-13, only 2 organisations will be used - 'Intermediate Administration Bodies' (IABs). IABs are directly contracted to the Scottish Government for the period up to the end of 2009 (new contracts will be considered for the period after). The contracts were subject to a full tendering exercise and have been made to ESEP Ltd (for the Lowlands & Uplands Scotland SF programmes) and Highlands & Islands (Scotland) Structural Funds Partnership Ltd (for the H&I SF programmes). The savings are to the public sector as a whole, rather than the Scottish Government itself. For 2000-06, the PMEs were paid for by a combination of contributions from Scottish stakeholders (not including the Executive) and technical assistance from the EU programmes. The cost to the Scottish public sector was approximately £16.2 million over the whole period. This method of funding intermediary bodies has been disallowed by the Commission, hence the decision by the Executive to take funding of the bodies in-house directly (EU technical assistance can still pay for a portion of the costs, so the net cost to the Scottish public sector - i.e. the Scottish Government - is estimated to be £4.5 million over the 7 years). Consequently, there is a savings to the overall public sector, but an additional cost to the Scottish Government. Savings are £1.64m p.a. Other Grants - Reducing limits and extending coverage of Regional Selective Assistance will deliver more economic growth in terms of GDP and lower cost for jobs than before.
- Possible Energy Saving Trust efficiencies in Year 2 and 3 through delivering more schemes for same money.
- Passing responsibility for 2 small innovation schemes to SEn and 2 to the Scottish Funding Council should achieve admin savings and delivery gains in years 2 and 3.
All of these savings are still to be quantified. |