Taking stock

A chartered accountant by trade, Baillie has presided over Scotland’s local government public spending watchdog since 2007. Now his term as chairman has come to an end, Baillie is able to reflect on the challenges which have affected local authorities during this time.

Speaking to Holyrood, he said: “The Accounts Commission is there to hold local authorities to account. Audit Scotland provides the reports, as do external firms. We then look at these reports and decide what we want to do about what they tell us.

“We follow up and we also look at the ways we can contribute to improvement on a generic basis, not on a council basis. This is important because we’re independent and we mustn’t do anything which might be seen to impair that independence. We guard that perception jealously, it is at the core of what we do. We derive our authority from our independence.”
Baillie is a former partner at KPMG, initially in Scotland and then in London, with a specialism in investigation and auditing. He was appointed to the Competition Commission in 2002 and was there for nine years. He became a member of the Accounts Commission for four years before being appointed chairman in 2007. Throughout his career, Baillie has been connected to the academic world, with links to the Universities of Glasgow and Edinburgh.

Speaking about the challenges he has seen facing councils in recent years, he said: “The main issue for local government, during my time as chairman, has been finances. We’re familiar with the general idea of the public sector, including councils and other local authorities, having to work under financial constraints but if that has not been bad enough, I think there’s more to come. At a time when you have demographic change, with many more people getting older and seeking all the services older people need – it’s a double whammy.

“Up to this point, councils, as we’ve said in several overview reports in the past two years, have done quite well in managing their finances. They have tended to use the mechanism of having fewer people through voluntary redundancy. They have used the reduction in workforce as their prime source of cutting their own costs. It would be fine if they had now resolved their problems but finances are going to continue to be tight and so they’ll have to come up with other ways of doing things.”

Another change in the local government landscape was the Concordat agreement between local and national government. Baillie said this has been important for the Accounts Commission. He added: “Something which has been coming through in a much more positive way is the development of single outcome agreements for community planning partnerships (CPPs). That’s a big deal. A lot of work has been done in the past nine months to develop the quality of these outcome agreements so they’re more measurable. That’s been really important in terms of the direction of CPPs but also in the measurement of them.

“One of the main planks of the Government’s public reform agenda is the CPPs. The Accounts Commission was asked to lead the development of the scrutiny of CPPs. Our first three reports did not make for encouraging reading because there was quite a way for them to go. However, since then, there’s been a lot of work done to improve working together and the governance of CPPs.
“The group that oversees CPPs is the National Community Planning Partnership Group. It takes these reports and tries to do something with them and contribute to their improvement. There’s been a lot of work done in the past months to take the report we submitted in May and start to deal with the many quite fundamental issues it included. That’s right at the heart of the public sector improvement agenda.”

Looking ahead, Baillie said the challenges which local government has faced over the past six years are set to intensify, with councils facing less resources but more demand on services.

He added: “The hope and the aim is that by working together within a community planning partnership, [councils] can find better ways of working, making things more streamlined and deliver better services.

“The Accounts Commission’s best value work has been able to identify the characteristics of a better performing council, for example, when a local authority has good relationships among councillors; good relationships between councillors and officials; good planning in terms of use of resource, and good governance. Having said that, one of the things we need to do is look more closely at the pace of improvement of some councils. It is fair to say that some councils, I wouldn’t want to overstate it, but there are some which need to look at the pace of their development and improvement more closely.

“The accountability of arm’s length external organisations (ALEOs) is also going to be important. It may well be that some form of greater scrutiny is needed by the Accounts Commission. There needs to be a mechanism for us to do that more directly and that’s something we’ve raised. It’s a debate which is also going on south of the border.

“Regarding CPPs, engagement with stakeholders – particularly older people – is important. That’s not as easy as it sounds because when local people, whoever they may be, experts or otherwise, are asked about a particular service or priority, it can be difficult for them to answer the question without full knowledge of the choices. The perspective of the respondent is quite difficult. Therefore you need to be careful, engaging properly is important but so is assessing the answers properly.”

The Accounts Commission has been working with the Society of Local Authority Chief Executives (SOLACE) Scotland for more than two years to develop a benchmarking project which was launched earlier this year. Baillie said he is pleased with the progress and the next stage is to expand the project with SOLACE but also to ensure the information which is presented is prepared properly and consistently. He added: “If you get people holding the council to account for their own purposes, to use a cliché, it means you’ve got armchair auditors. This includes the media, who can then drill down and interpret and raise questions. The changes this could generate could be massive.”

Now he has left the Accounts Commission, Baillie hopes to continue his academic work, as well as focusing on his own specialist private practice. However, while he might be stepping down from this role, Baillie is still interested in continuing to work in the public sector. “I’ve found it fascinating,” he said. “There are many able and committed people in the public sector and I’ve enjoyed working with them and would like to continue to do so.”