|
SCHEDULE 1 - CAPITAL EXPENDITURE OF, AND BORROWING BY,
CERTAIN STATUTORY BODIES
General Purpose
151. This schedule amends legislation
concerned with the capital expenditure of and borrowing by various statutory
bodies. The effect of paragraph 1 is to require the Scottish Ministers,
in consenting to capital expenditure under section 94 of the Local Government
(Scotland) Act 1973, to keep within a limit set by Budget Act. The remaining
provisions ensure that bodies can only borrow in any financial year
up to a net limit which will be set by the Parliament in a Budget Act
for that year. One limit will be set for all bodies within a particular
group. It will limit the net aggregate amount of external borrowing
of all of those bodies in the year concerned.
152. The bodies to whom this applies are:
- NHS Trusts (paragraph 2);
- Scottish Homes (paragraph 3);
- Scottish Enterprise and Highlands and Islands Enterprise (paragraph
4);
- New water and sewerage authorities (paragraph 6);
- Scottish Environment Protection Agency (paragraph 7).
SCHEDULE 2: AUDIT SCOTLAND: FURTHER PROVISIONS
General Purpose
153. This schedule supplements section
10 of the Act which establishes Audit Scotland. (The financial arrangements
of Audit Scotland are set out in section 11.)
Paragraphs 1 - 4
154. These paragraphs deal with membership
issues. Section 10(2) states that the following should be members of
Audit Scotland:
(a) the Auditor General ,
(b) the Chairman of the Accounts Commission, and
(c) 3 other members who are to be appointed jointly by the Auditor
General and the Chairman of the Accounts Commission.
155. Under the rules set out in these
paragraphs, the Auditor General, the Chairman of the Accounts Commission
and any members of staff of Audit Scotland or members of the Accounts
Commission who are appointed as members, may not receive any additional
remuneration for their appointment. They also make it clear that additional
members are to serve under terms agreed between the Auditor General
and the Chairman of the Accounts Commission. Finally, they make provisions
for the resignation of members and for their removal by the Auditor
General and the Chairman of the Accounts Commission on grounds of inability
or unfitness.
Paragraph 5
156. This paragraph gives Audit Scotland
powers to appoint staff and determine their terms and conditions. This
paragraph also gives Audit Scotland powers to remunerate staff and make
provision for pensions.
Paragraph 6
157. This paragraph gives Audit Scotland
the powers it needs (such as to hold property) to carry out its functions.
It also provides Audit Scotland with short term borrowing powers.
Paragraph 7
158. This paragraph enables Audit Scotland
to appoint a member to preside at meetings, to set its own procedures
and provide that its actions are not rendered invalid if there is a
vacancy or if a member has not been properly appointed.
Paragraphs 8 and 9
159. These paragraphs make arrangements
for the transfer of staff from the Accounts Commission to Audit Scotland.
The Act does not make provision for the transfer of staff from the National
Audit Office to Audit Scotland. It is expected that this will be achieved
by subordinate legislation under other powers.
160. Under the provisions set out in these
paragraphs, officers of the Accounts Commission will automatically transfer
to Audit Scotland on 1 April 2000. Their terms and conditions must be
at least as favourable as those on which the Accounts Commission employed
them. There are then a number of technical provisions designed to ensure
that no individuals suffer a break in employment due to the transfer
and that no officer may be deemed to have been retired or dismissed
as a result of the transfer.
161. In addition to the transfer of staff,
these paragraphs make provision for the transfer of property, rights
and liabilities from the Accounts Commission to Audit Scotland on 1
April 2000.
SCHEDULE 3: SCOTTISH COMMISSION FOR PUBLIC AUDIT: FURTHER PROVISIONS
General Purpose
162. This schedule makes further provisions
relating to the membership, procedures and financing of the Scottish
Commission for Public Audit.
Paragraph 1
163. This provides for the person who
is the Convener of the Audit Committee immediately prior to Parliament
being dissolved to continue to be a member of the Scottish Commission
for Public Audit until a new convener is appointed following a general
election. This is to ensure that the Commission can continue to exercise
its functions.
Paragraph 2
164. This provides that all other members
of the Scottish Commission for Public Audit cease to be members when
the Parliament is dissolved, or if they resign their membership or cease
to be a member of the Parliament. In effect, new members must be appointed
after every general election.
Paragraph 3
165. This is to ensure the Commission's
actings are not affected by vacancies or defects in the appointment
of members.
Paragraph 4
166. This gives the Commission the power
to determine for itself its own procedures, including who should preside
at its meetings.
Paragraphs 5 to 7
167. These paragraphs require the SPCB
to provide, or arrange the provision of, any staff, property or services
which the Commission decides it requires to perform its functions. The
expenses of the Commission are also to be met by the SPCB. Provision
is also made for the Commission to direct the SPCB in relation to these
matters. Such directions must be given in writing (section 27(4)).
SCHEDULE 4: MODIFICATION OF ENACTMENTS RELATING TO PART 2
General Purpose
168. This schedule is for the most part
intended to provide consistency in the audit arrangements for a wide
range of public bodies. It provides for the specified bodies (other
than local authorities) to submit their accounts to the Scottish Ministers,
who in turn will be required to send them to the Auditor General for
Scotland. The accounts will then be audited in accordance with the standard
audit provisions made in sections 21 and 22 of this Act.
169. The effect is to replace current
provisions which require auditing by, variously, the Comptroller and
Auditor General (although section 120 of the Scotland Act will amend
that to the Auditor General), auditors appointed by the Secretary of
State, and auditors appointed by bodies themselves. In the case of health
service bodies, provision is made for their accounts to be submitted
to the Scottish Ministers (for auditing by the Auditor General) rather
than to the Accounts Commission as is the current position.
170. The position of local authorities
is unchanged; they will continue to be required to send their accounts
to the Accounts Commission for auditing. The bodies affected by the
amendments in the schedule are-
(a) the Board of Trustees of the National Galleries of Scotland
(paragraph 1);
(b) the Board of Trustees of the National Library of Scotland (paragraph
2);
(c) the Scottish Hospitals Endowments Research Trust (paragraph
4(2));
(d) health service bodies (Health Boards, NHS Trusts, the Common
Services Agency, the Mental Welfare Commission, the State Hospital
Management Committee and others to which the National Health Service
(Scotland) Act 1978 is applied) (paragraph 4(3));
(e) the Board of Trustees of the National Museums of Scotland (paragraph
5(2));
(f) the Board of Trustees of the Royal Botanic Garden, Edinburgh
(paragraph 5(3));
(g) the Scottish Legal Aid Board (paragraph 6);
(h) Scottish Homes (paragraph 7);
(i) Scottish Enterprise and Highlands and Islands Enterprise (paragraph
9);
(j) Scottish Natural Heritage (paragraph 10);
(k) the Scottish Further Education Funding Council, the Scottish
Higher Education Funding Council and boards of management of further
education colleges (paragraph 11);
(l) new water and sewerage authorities (paragraph 12(2));
(m) the Scottish Children's Reporter Administration (paragraph 12(3));
(n) the Water Industry Commissioner for Scotland (paragraph 12(4));
(o) the Scottish Environment Protection Agency (paragraph 13);
(p) the Scottish Criminal Cases Review Commission (paragraph 14);
and
(q) the Scottish Qualifications Authority (paragraph 15).
171. The schedule also makes various amendments
to Part VII of the Local Government (Scotland) Act 1973 that deal with
the Accounts Commission for Scotland. The main changes are to reflect
the creation of Audit Scotland and the transfer of responsibility for
the audit of health service bodies to the Auditor General. As a consequence
of the establishment of this body, the Accounts Commission will no longer
employ staff, incur expenditure or charge fees. All their costs will
be met by Audit Scotland and the staff of that body will provide such
assistance and support as the Accounts Commission requires. Audit Scotland
will also determine charges to be applied in respect of work relating
to local authorities. Accordingly, all provisions relating to the Accounts
Commission's powers to appoint staff, incur expenditure and charge fees
are repealed. The schedule also removes from the Commission the function
of auditing accounts or undertaking studies in respect of health service
bodies. These functions will instead fall to the Auditor General. The
schedule also makes amendments to the minimum and maximum number of
Commissioners that the Scottish Ministers may appoint. The following
note shows the effect of the amendments to the 1973 Act.
LOCAL GOVERNMENT (SCOTLAND) ACT 1973
This note shows sections 96 to 106 of, and Schedule 8 to, the 1973
Act as amended by the Act. The effect of general modifications made
by the Scotland Act is shown in italics. Account has been taken of amendments
made to the 1973 Act by the Health Act 1999.
Accounts and audit
96 Accounts and audit
(1) Every
local authority shall keep accounts of all transactions relating to
all funds of the authority and, subject to any provision contained
in regulations made under section 105 of this Act, the accounts of
the general fund of a local authority shall comprise such current,
capital and borrowing accounts as may be necessary for the purpose
of distinguishing transactions for different purposes.
(2) All
accounts of a local authority shall be made up in respect of each
financial year.
(3) Every
local authority shall, in addition to preparing accounts in respect
of any financial year, prepare in duplicate an abstract of the accounts
for that year.
(4) The
accounts of every local authority in respect of any financial year
shall be audited by a professional accountant, who is either a
member of the staff of Audit Scotland an officer of the Accounts
Commission for Scotland or is an approved auditor appointed by
the Commission in accordance with the provisions of this Part of this
Act.
(5) The
financial year of a local authority shall be the period of twelve
months ending with 31st March; and references in this Act and in any
other enactment (whether passed or made before or after the passing
of this Act) to the financial year of a local authority shall be construed
in accordance with the provisions of this subsection.
(6) The
[Scottish Ministers] may by order make provision amending, repealing
or revoking, with or without savings, any enactment which is inconsistent
with or superseded by subsection (5) above; but no order under this
subsection shall have effect unless it is approved by a resolution
of [the Scottish Parliament] .
97 Establishment
of Accounts Commission for Scotland.
(1) There
shall be established a body, to be known as the Accounts Commission
for Scotland (hereafter in this Part of this Act referred to as "the
Commission"), which shall consist of such number of members, not being
more than twelve fifteen or less than six eleven,
as the [Scottish Ministers] may determine, and the members shall be
appointed by the [Scottish Ministers] after consultation with such
associations of local authorities and such organisations connected
with the health service as appear to [them] to be concerned and
with such other organisations or persons as [they] may think appropriate.
(2) The
Commission shall have the following functions, that is to say -
(a) securing the audit
of all accounts of -
(i) local authorities;
(ii) the bodies mentioned
in section 86(1)(a) to (c) of the National Health Service (Scotland)
Act 1978;
(iv) the Mental Welfare
Commission for Scotland; and
(v) any State Hospital
Management Committee constituted under section 91 of the Mental
Health (Scotland) Act 1984,
in accordance with the provisions of this Part
of the Act;
(2AA) Any
function of the Commission may be exercised on behalf of the Commission
by any person (whether or not a member of the staff of Audit Scotland)
authorised by the Commission to do so.
(2AB) Subsection
(2AA) above does not apply in relation to the following functions-
(a) considering
reports in pursuance of subsection (2)(b) above,
(b) appointing an auditor
under subsection (6) below,
(c) deciding
who is to audit any account, or class of account, in pursuance
of this Part of this Act,
(d) deciding
whether to undertake or promote a study under section 97A or 105A
of this Act.
(2AC)
Subsections (2AA) and (2AB) above do not affect the responsibility
of the Commission for the exercise of their functions.
(2A) . . .
(2B) In this Part of the Act -
"health service body" means a body referred
to in subsection (2)(a)(ii) to (v) above; and
. . .
(3) The
[Scottish Ministers] may, after consultation, with the Commission,
with such associations of local authorities and such organisations
connected with the health service as appear to [them] to be concerned
and with such other organisations or persons as [they] may think appropriate,
give to the Commission directions of a general character as to the
discharge of their functions, and the Commission shall give effect
to any direction so given.
(4) There
shall be a Controller of Audit who shall be appointed by the Commission
after consultation with, and subject to the approval of, the [Scottish
Ministers] , and the Commission may appoint such other officers,
and may appoint such agents, as they may determine.
(4AA) The
Controller of Audit shall, by virtue of appointment as such, be a
member of the staff of Audit Scotland unless that person is also the
Auditor General for Scotland.
(4A) It
shall be the duty of the Commission to make, by such date as Secretary
of State may determine, an offer of employment by the Commission to
each person employed in the civil service of the State in connection
with the audit of the accounts of any health service body whose name
is notified to the Commission by the Secretary of State for the purposes
of this subsection; and the terms of the offer must be such that they
are, taken as a whole, not less favourable to the person to whom the
offer is made than the terms on which he is employed on the date on
which the offer is made.
(4B) An offer made
in pursuance of subsection (4A) above shall not be revocable during
the period of three months beginning with the date on which it is
made.
(4C) Where
a person becomes an officer of the Commission in consequence of subsection
(4A) above, then, for the purposes of the Employment Protection (Consolidation)
Act 1978, his period of employment by the Commission and the change
of employment shall not break the continuity of the period of employment.
(4D) Where
a person ceases to be employed as mentioned in subsection (4A) above
-
(a) on becoming an
officer of the Commission in consequence of an offer made in pursuance
of that subsection; or
(b) having unreasonably
refused such an offer,
he shall not, on ceasing to be so employed, be
treated for the purposes of any scheme under section 1 of the Superannuation
Act 1972 as having been retired on redundancy.
(4E) The
Secretary of State may supply to the Commission any information held
by him which relates to housing benefit or council tax benefit and
which appears to him to be relevant to the exercise of any of the
functions of the Commission.
(5) The
provisions of Schedule 8 to this Act shall have effect in relation
to the Commission.
(6) In
this Part of this Act "auditor" includes (a) the Controller of Audit,
(b) members of the staff of Audit Scotland officers of the
Commission, being professional accountants, and (c) auditors appointed
by the Commission for the purpose of conducting audits or, as the
case may be, a particular audit under this Part of this Act, or
a person who is, within the period of five years beginning with the
relevant date, approved by the Secretary of State, acting on the recommendation
of the Commission and whose approval is not (whether during that period
or after its expire) withdrawn by the Secretary of State acting on
such recommendation.
(6A) In
subsection (6) above, "the relevant date" means the date appointed
for the coming into force of paragraph 3(3) of Schedule 7 to the National
Health Service and Community Care Act 1990.
(7) A
person shall not be appointed as auditor by the Commission under subsection
(6) above unless -
(a) he is eligible for
appointment as a company auditor under section 25 of the Companies
Act 1989; or
(b) he is a member of
the Chartered Institute of Public Finance and Accountancy or of
any other body of accounts established in the United Kingdom and
for the time being approved by the [Scottish Ministers] for the
purposes of this subsection.
97A Studies for improving economy etc in services
(1) The
Commission shall undertake or promote comparative and other studies
designed to enable it to make recommendations for improving economy,
efficiency and effectiveness in the provision of services by local
authorities or by other bodies whose accounts are required to be audited
in accordance with this Part of this Act, and for improving the financial
or other management of such authorities or other bodies.
(2) The
Commission shall publish or otherwise make available its recommendations
and the results of any studies undertaken or promoted under this section
and, in the case of studies relating to a health service body,
shall on request, furnish to the Comptroller and Auditor General all
material relevant to the studies.
(3) Before
undertaking or promoting any study under this section the Commission
shall consult such associations of local authorities or other bodies
whose accounts are required to be audited in accordance with this
Part of this Act as appear to it to be concerned and such associations
of employees as appear to it to be appropriate and, in the case
of a health service body, the Commission shall also consult the Secretary
of State and the Comptroller and Auditor General.
97B Furnishing of information and documents to
the Commission
(1) The
Commission shall have power to incur such expenses as appear to them
to be necessary or expedient for the proper discharge of their functions,
and such expenses shall be met by Audit Scotland-
(a) the Secretary of
State may, with the consent of the Treasury, pay to the Commission
relating to their functions with respect to local authorities
grants of such amounts, at such times and subject to such conditions
as he may determine in respect of expenses incurred by the Commission
as aforesaid;
(b) such part of the
expenses of the Commission as it not met by grants under paragraph
(a) above shall be met by local authorities in accordance with
regulations made by the Secretary of State after consultation
with such associations of local authorities as appear to him to
be concerned;
(c) such part of the
expenses of the Commission relating to their functions with respect
to health service bodies as it not met by grants under paragraph
(a) above shall be met by health service bodies in accordance
with regulations made by the Secretary of State after consultation
with such organisations connected with the health service as appear
to him to be concerned.
(2) A
statutory instrument containing regulations made by the Secretary
of State under paragraph (b) or (c) of subsection (1) above shall
be subject to annulment in pursuance of a resolution of either House
of Parliament.
(3) The Commission shall
keep proper accounts and other records in relation to their accounts
and shall prepare in respect of each financial year a statement of
account in such form as the Secretary of State may, with the approval
of the Treasury, direct.
(4) The statement of
account prepared by the Commission in respect of each financial year
shall be submitted to the Secretary of State before such date, as
he may, with the approval of the Treasury, direct.
(5) The Secretary of
State shall, on or before 31st March in each year, transmit to the
Comptroller and Auditor General the statement of account prepared
by the Commission for the financial year last ended.
(6) The Comptroller and
Auditor General shall examine and certify the statement of account
transmitted to him under subsection (5) above and shall lay before
Parliament copies of that statement together with his report thereon.
(7) In this section "financial
year" means the period of twelve months ending with 31st October in
any year.
98 Expenses and accounts of Commission
(1) The
Commission shall have power to incur such expenses as appear to them
to be necessary or expedient for the proper discharge of their functions,
and such expenses shall be met by Audit Scotland-
(a) the Secretary of
State may, with the consent of the Treasury, pay to the Commission
relating to their functions with respect to local authorities
grants of such amounts, at such times and subject to such conditions
as he may determine in respect of expenses incurred by the Commission
as aforesaid;
(b) such part of the
expenses of the Commission as it not met by grants under paragraph
(a) above shall be met by local authorities in accordance with
regulations made by the Secretary of State after consultation
with such associations of local authorities as appear to him to
be concerned;
(c) such part of the
expenses of the Commission relating to their functions with respect
to health service bodies as it not met by grants under paragraph
(a) above shall be met by health service bodies in accordance
with regulations made by the Secretary of State after consultation
with such organisations connected with the health service as appear
to him to be concerned.
(2) A
statutory instrument containing regulations made by the Secretary
of State under paragraph (b) or (c) of subsection (1) above shall
be subject to annulment in pursuance of a resolution of either House
of Parliament.
(3) The
Commission shall keep proper accounts and other records in relation
to their accounts and shall prepare in respect of each financial year
a statement of account in such form as the Secretary of State may,
with the approval of the Treasury, direct.
(4) The
statement of account prepared by the Commission in respect of each
financial year shall be submitted to the Secretary of State before
such date, as he may, with the approval of the Treasury, direct.
(5) The
Secretary of State shall, on or before 31st March in each year, transmit
to the Comptroller and Auditor General the statement of account prepared
by the Commission for the financial year last ended.
(6) The
Comptroller and Auditor General shall examine and certify the statement
of account transmitted to him under subsection (5) above and shall
lay before Parliament copies of that statement together with his report
thereon.
(7) In
this section "financial year" means the period of twelve months ending
with 31st October in any year.
99 General duties of auditors
In auditing the accounts
of any local authority or health service body under this Part
of this Act, an auditor shall, by examination of the accounts and
otherwise, satisfy himself that -
(a) the accounts have
been prepared in accordance with regulations made under section
105 of this Act or, in the case of a health service body, directions
under section 86(3) of the National Health Service (Scotland)
Act 1978 and comply with the requirements of all other enactments
and instruments applicable to the accounts;
(b) proper accounting
practices have been observed in the preparation of the accounts;
(c) that the local authority
or health service body has made proper arrangements for securing
economy, efficiency and effectiveness in its use of resources;
and
(d) in a case where that
body are required to publish information in pursuance of a direction
under section 1 of the Local Government Act 1992 (publication
of performance information), that body have made such arrangements
for collecting and recording the information, and for publishing
it, as are required for the performance of their duties under
that section.
| 
