National Audit Office on Westminster: ’lacks evidence on whether the billions of pounds of public funding it has awarded to local bodies in the past for supporting local growth have had the impact intended’.
By stewartb – a long read
The corporate media and BBC in Scotland regularly scan reports from Audit Scotland for quotable negatives. It’s all part of holding the Scottish Government to account!
However, they rarely if ever inform taxpayers in Scotland what the National Audit Office (NAO) concludes about the Westminster government’s management of public finances. It’s as if individuals and businesses in Scotland who pay tax to the UK exchequer have no interest in how effectively and efficiently – or otherwise – Westminster uses our hard-earned contributions.
It’s bad enough when this reporting blackout relates to reserved policy areas like ‘defence’: substantial financial failings – waste – here have been exposed on a number of occasions with no media coverage in Scotland. Absence of reporting becomes of even greater significance now that Westminster is by-passing our elected Government and Parliament in Holyrood to intervene directly in Scotland, in areas of policy that are – or should be – devolved.
The publication of Westminster’s ‘Levelling Up the United Kingdom’ White Paper which details Westminster’s economic development interventions in Scotland brings this matter to a head. The over-reach by Westminster is wrong in principle. However, a recent report by the NAO reveals that it is also highly problematic – to say the least – in terms of likely efficacy, given the track record of Tory governments.
The NAO published (on 2 February) a report entitled ‘Supporting local economic growth’: It addresses policy within the remit of the UK Department for Levelling Up, Housing & Communities (DLUHC). It is a highly critical assessment of UK government capability and performance in addressing regional and local economic development: the NAO’s conclusions are remarkable!
The NAO states: ’The Department has a poor understanding of what has worked well in its previous local growth programmes because it has not consistently evaluated them. Despite frequent changes in structures, funding regimes and local growth initiatives, external scrutiny has continued to identify common weaknesses, including unclear objectives, and poor monitoring and evaluation.’
Those familiar with economic development in Scotland, whether financed by the Scottish Government (including via Scottish Enterprise, Highlands and Islands Enterprise or Local Authorities) with or without EU funding, will be aware of the expertise in and very large archive of formal evaluation that has been built In Scotland over decades.
However, by contrast the NAO notes: ’Contrary to HM Treasury guidance for evaluations (the Magenta Book), the Department has not systematically evaluated its local growth policies to assess whether they have delivered, or are on track to deliver, their intended impact. Therefore, it cannot say which of its interventions have been most successful in addressing problems or whether they have achieved value for money. By failing to conduct robust evaluation or even write up lessons learned from previous policies, the Department has wasted opportunities to learn and apply lessons to subsequent policies to ensure continuous improvement.’
The NAO confirms: ‘Except for the Towns Fund, which is for England only, the Department is administering all of the interventions on a UK-wide basis, working directly with local authorities in the devolved administrations for the first time in more than two decades. The Department tells us that it has set up dedicated teams to manage these relationships and is working closely with officials in the territorial offices to apply institutional learning.’ The ‘territorial office’ is the Office of the Secretary of State for Scotland but whose ‘institutional learning’?
So a Westminster department, and government, that evidently has ‘poor understanding’ even of what works in England is now combining this with its lack of knowledge/experience of policy development and delivery in Scotland over the past two decades whilst circumventing Holyrood!
Should we be confident in Westminster’s ability to overcome these limitations? Well, not according to the NAO!
Failure to learn
The NAO concludes: ‘The Department has not consistently applied the lessons and key policy principles from its own research or from external scrutiny to the design of new local growth interventions. The Department provided limited evidence, for example in the business cases, that it had designed the current interventions using robust evidence of what works best to stimulate local economies ..’
Given that in Scotland, as in Wales and NI, there are well established and evolving, integrated policies for economic development this further observation from the NAO is especially concerning: ‘The way the interventions work currently makes it hard for local authorities to plan the joined-up investment strategies the Department’s research suggests are needed to promote local growth.’
If it’s proving hard to achieve joined up strategies within England how much more problematic will it be to find coherence and value for money between what the DLUHC requires for successful competitive bids from local authorities outside England and the extant economic development strategies and initiatives designed and implemented by devolved governments and their national and local stakeholders?
As something of an understatement, the NAO notes: ’The Department recognises that it will need to establish new relationships and understanding of local circumstances and policies in the devolved nations to ensure it does not award funding that duplicates or clashes with other national policies.’
Before reading the NAO report I contributed this on the Levelling Up White Paper btl elsewhere. It seems to be borne out by the NAO’s findings:
‘Today’s White Paper states this: “.. the UK Government will target £100m of investment in three new Innovation Accelerators, private-public-academic partnerships which will aim to replicate the Stanford-Silicon Valley and MIT-Greater Boston models of clustering research excellence and its direct adoption by allied industries. These pilots will be centred on Greater Manchester, the West Midlands and Glasgow City-Region.”
This jargon-filled statement of intent adds credence to the view that much in the White Paper is SPAD-contrived shallow thinking produced for PR effect.
Since at the very least the Royal Society of Edinburgh/Scottish Enterprise ‘Commercialisation Enquiry’ in 1996, stakeholders in Scotland in R&D, innovation and the commercialisation of science and technology have been working many and various models of business/industry cluster development, private-public-academic partnerships, knowledge/technology transfer, tech-based entrepreneurship, business incubators/’accelerators’ etc.
The notion that we in Scotland in 2022 need a Westminster initiative to ‘pilot’ – to learn about or trial – something as vague as ‘Stanford-Silicon Valley and MIT-Greater Boston models’ is, candidly, laughable if not insulting.
Of course, as there is money to be had, the universities in Glasgow for example will likely lavish ‘praise’ on this Tory initiative regardless of its rationale – ‘Replicate the Stanford-Silicon Valley model? Of course we can do that – no problem – thanks for the cash!’
The NAO adds: ‘The Department considers collaboration and coordination to be critical but has not yet established a cross-government programme to manage local growth initiatives.’ So despite clear deficiencies in collaboration/co-ordination across Whitehall this Tory government deems it acceptable and appropriate to circumvent the devolved governments and parliaments to impose its political agenda.
We learn more: ‘The Department has had to increase its headcount significantly and does not yet have the capacity or capability it needs. The Department expects its workload to increase significantly because of an increase in domestic funding arising from the replacement of European funding, and because it is administering funding on a UK-wide basis where previously it operated in England only. The Department is increasing headcount in the Cities and Local Growth Unit from around 420 (as at June 2021) to around 750, but faces longstanding challenges with staff turnover.’
Ditching good practice
On the matter of ensuring ‘value for money’, the NAO notes: ‘The Department, with HM Treasury’s approval, did not produce all three stages of the (usual) business case process for the Levelling Up Fund, instead consolidating the stages into a single business case.’
And on this more limited business case, the NAO reveals: ‘This business case did not document, as it should, the substantive comparison, evaluation, costing and deliverability of alternative options for achieving ministerial aims. While there may have been good reason to move quickly, bypassing the earlier stages of business case review limits the amount of scrutiny and independent challenge.’
Specifically on the £4.8 billion Levelling Up Fund: ‘.. we have not seen the evidence we would expect on the options that had been considered for achieving ministerial aims when government is spending such a large amount of money. This reduces our confidence that the interventions will have the best possible chance of delivering value for money.’
So a formal appraisal of the (obvious) option, namely to deliver via the Scottish Government and Parliament, as has been established practice agreed in the devolution settlement, was never undertaken? Decision making simply motivated by crude, aggressive Unionism and not by consideration of value for money – of effectiveness, efficiency and economy?
And can you imagine the Scottish press pack if this was referring to an SNP Scottish Government?
‘The Department therefore lacks evidence on whether the billions of pounds of public funding it has awarded to local bodies in the past for supporting local growth have had the impact intended. And it has wasted opportunities to learn which initiatives and interventions are most effective.’ But theUnionist media silence is deafening even though the Levelling Up issue has been so newsworthy!
How is it possible to be ‘better together’ with this?