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CONCORDAT BETWEEN HM TREASURY AND THE SCOTTISH EXECUTIVE
Aim
As a result of the Scotland
Act 1998, devolution of power to the Scottish Parliament has affected
the manner in which the UK is governed. HM Treasury has retained responsibility
for the macro-management of the UK’s economy. Primary legislation
powers and responsibility for the administration of many other areas
of policy (that is other than those described in Schedule 5 of the
Scotland Act 1998) have been devolved to the Scottish Parliament.
In addition, there are areas of executive devolution set out in Schedule
5 of the 1998 Act where primary legislative powers rest with the UK
Parliament at Westminster but administration of those powers has passed
to Ministers of the Scottish devolved government.
The purpose of this concordat is to set out clearly
the relationship between HM Treasury and the Scottish Executive to
ensure that both are aware of the requirements of the other and that
both are consequently able to fulfil their responsibilities fully.
This concordat is made
in addition to any statutory arrangements for the provision of information
to HM Treasury made under section 96 of the Scotland Act 1998 and
the Statement of Funding Policy, an updated version of which was published
by HM Treasury on 18 July 2000.
Parties
This concordat is made between HM Treasury and the Scottish
Executive.
General Principles
This concordat is non-statutory and not legally binding.
It should be read in conjunction with the Memorandum of Understanding
between the devolved administrations and the UK Government. However,
HM Treasury and the Scottish Executive agree to abide by its provisions.
Period
This concordat will be reviewed initially after 12 months
and then at least every three years. It may be reviewed at any other
time at the request of either party.
Consultation Arrangements
There will be regular consultation between officials
from HM Treasury and those of the Scottish Executive to ensure that
there is co-operation between the two administrations and that the
business of both operates effectively.
To this end there should
be a formal liaison meeting between officials from HM Treasury and
the Scottish Executive at least twice a year if possible.
In addition, the Principal Finance Officer of the Scottish
Executive will be invited to attend HM Treasury’s regular meetings
of Principal Finance Officers of Government departments in addition
to any attendance from the Scotland Office.
Exchange of Information
Provision for the supply of information required by
HM Treasury under section 96 of the Scotland Act 1998 is set out separately.
In addition to that information, the Scottish Executive undertakes
to provide HM Treasury with the following in response to all reasonable
requests:
1.
sufficient
information to enable HM Treasury to fulfil its responsibility of
managing the UK’s national debt;
2.
all the information
necessary to allow HM Treasury to maintain and update its Public Expenditure
Database, including that information needed to classify correctly
the activities and transactions of the Scottish Executive in the national
accounts and in the UK Government's public expenditure control system,
and the information needed to prepare Whole of Government Accounts;
3.
information
necessary to allow HM Treasury to maintain and update its General
Expenditure Monitoring System;
4.
advance notice
wherever practicable of any proposed Scottish legislation or other
policy developments which will have an impact on HM Treasury’s responsibilities,
including macroeconomic management, the management of foreign currency
reserves, fiscal policy and regulation of financial services;
5.
sufficient
information on National Non-Domestic Rates as they relate to Scotland
to allow HM Treasury to produce National Non-Domestic Rates forecasts;
6.
advice and
guidance issued by the Scottish Finance Department to Scottish Departments
on issues such as accounting, public procurement, external auditing
and finance.
In return, HM Treasury undertakes to provide
the Scottish Executive with the following:
1.
advance notice
wherever practicable of any UK legislation proposed by HM Treasury
or HM Treasury’s policy developments which will have an impact on
the Scottish Parliament’s tax varying power as well as devolved areas
in general as they relate to Scotland;
2.
information relating to or affecting the level of the
Scottish Executive’s Departmental Expenditure Limit, Assigned Budget
and Annually Managed Expenditure allocations as soon as it is known,
via the Secretary of State for Scotland or directly as appropriate
and consistent with the timing of Budget and spending review announcements,
in order to allow the Executive to manage its resources properly;
3.
HM Treasury
guidance to UK Government Departments, such as DAO letters, and advice
and guidance on accounting, public procurement, external audit and
finance.
Access to the Reserve
Treasury officials will inform Scottish Executive
officials on a confidential basis about cases of access to the Reserve
in respect of comparable programmes of UK Government departments as
soon as practicable. Decisions on access to the Reserve on the part
of the Scottish Assigned Budget will be made on the basis of the criteria
set out in the Statement of Funding Policy.
Receipts Direction
Under sections 64(5)
and 64(6) of the Scotland Act, the Treasury may make a direction specifying
certain receipts or categories of receipt in respect of which Scottish
Ministers are required to make payments to the Secretary of State
for Scotland. The Treasury will review, in consultation with the Scottish
Executive, any such direction not more than one year after it is made,
and thereafter annually unless otherwise agreed with Scottish Ministers.
Scottish Ministers may at any time request a fresh review of any such
direction, and the Treasury will endeavour to respond within a reasonable
time to such a request.
Government Accounting Service
Accountants working for the Scottish Executive
will continue to be members of the Government Accounting Service (GAS)
and will therefore continue to take part in all GAS activities.
Audit Policy and Advice Team (APA)
APA will continue to advise their Scottish
colleagues. Liaison meetings on internal audit matters will therefore
continue between the APA Group, HM Treasury and the Internal Audit
Team of the Scottish Executive.
Government Procurement Service
Officials working for the Scottish Executive
in designated procurement posts will continue to be members of the
Government Procurement Service (GPS) and will therefore continue to
take part in all GPS activities.
Resolution of Disagreements
The main intention of
this concordat is to provide a framework for consultation and co-operation
which minimises the chances of disputes occurring. To this end, both
HM Treasury and the Scottish Executive undertake to conduct their
relationship on a “no surprises” basis. In addition, should disputes
arise between HM Treasury and the Scottish Executive, both parties
should attempt to solve these through the consultation arrangements
set out above.
If it is not possible to resolve such disputes
within the consultation framework established by this document, the
issues shall be decided by consultation between the Treasury Ministers,
the Secretary of State for Scotland and the Ministers of the Scottish
Executive.
Should agreement still not be possible, the
matter shall be referred to the Cabinet Office for the machinery established
by the Cabinet Office to mediate on the disputed matter.
In case of disagreement
or dispute over matters relating to the level of the Scottish Parliament’s
Assigned Budget, the operation of the funding Rules or other actions
of either the Scottish Parliament or the Treasury relating to finance
for the Scottish Executive, Scottish Executive Ministers or the Secretary
of State for Scotland can pursue the issue with Treasury Ministers.
This is the normal procedure for resolving disputes on all financial
issues and mirrors the arrangements between the Treasury and departments
of the United Kingdom Government. The Treasury will consider and
respond to any such representation in taking this forward with the
relevant party. Such matters can also be raised at the Joint Ministerial
Committee, which will include the relevant Ministers from the United
Kingdom Government and devolved administrations.
February 2001
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