Transparency, integrity, and independence: the keys to improving Budget scrutiny and public understanding of risks to public finances

In our latest blog in this series, Silvia Palombi, Senior Economic Analyst at the Scottish Fiscal Commission (SFC), talks about what the SFC has been doing to help make sure that the Scottish Budget is transparent and well-scrutinised, and to help Government and Parliament understand the inevitable uncertainties and risks relating to devolved public finances. SFC goes to great lengths to make their work as accessible and widely understood as possible, while working in an open and transparent way.  

SFC’s work therefore has clear relevance to our analytical leadership findings, particularly the need to ‘demonstrate transparency and integrity’ in order to build public trust and confidence the analytical evidence that is produced and used across government. It’s work also vital in ‘fostering an evidence-driven culture’ to support effective policy-making, while SFC’s role as an expert function makes its work directly relevant to the ‘draw on analytical standards and expert functions’ theme.    

What is the Scottish Fiscal Commission?

The Scottish Fiscal Commission is Scotland’s independent fiscal institution – we’re sometimes referred to as Scotland’s fiscal watchdog. We exist to help the Scottish Budget be transparent and well-scrutinised, and to help Government and Parliament understand the inevitable uncertainties and risks relating to devolved public finances. Our forecasts and analysis are also used to inform fiscal policy debate among stakeholders, the media, and the public. 

What do we do? We produce robust, independent, official forecasts of Scotland’s economy, devolved tax revenues and social security spending, used for the Scottish Budget. For our work to have any impact in improving the transparency and scrutiny of the Budget, it’s vital for us to remain – and be perceived as – completely impartial and independent so that people can trust our analysis and assessments. Having the right values, and embodying them in all that we do, is essential for that. 

We’ve made a public statement of voluntary compliance with the Code of Practice for Statistics to demonstrate how we apply the Code and give users confidence in our work. In line with our responsibilities as an independent fiscal institution, we also adhere to the Principles for Independent Fiscal Institutions set out by the Organisation for Economic Cooperation and Development (OECD). We follow both these sets of professional standards in everything we do. 

We explain complex matters clearly and make our work easy to access 

Information or analysis is of little use if no-one can access it, use it, or understand it. So we are committed to making our forecasts and reports accessible and understandable. 

We’ve invested significant resources into producing summaries of our work, infographics, visual guides, and explainer videos to deliver direct, clear messages for general audiences. This is alongside our detailed reports and supplementary tables which are for more technical users. 

We use different channels to ensure we communicate our work effectively. We deliver media presentations for journalists on the day of publication, or the day after, to ensure appropriate interpretation and informed coverage of our work. This means that our analysis is generally accurately reported in the media. We support wider public understanding by directly engaging with users through webinars and social media activity. Our breakfast briefings for the Scottish Parliament, where we explain what our forecasts and analysis mean for the Budget, are highly appreciated by Parliament members and staff. 

We are transparent and we promote transparency in Scottish public finances

As well as making our work as accessible and widely understood as possible, we do our work in an open and transparent way.  

In our Occasional Papers we share details about the methods and assumptions underpinning our forecasts. By doing so, we help users understand how our forecasts are produced and how we’ve come to our judgements, and we invite comments and questions. In our regular publications of Scotland’s Economic and Fiscal Forecasts we are also explicit about any caveats and limitations of input data as a source of uncertainty for our forecasts, such as the recent challenges with official labour market statistics discussed in our December 2023 publication. 

Over the last year, after holding a stakeholder consultation, we published a report describing a crucial part of our forecasting process, which is the choice of policy baselines. While we called for the Scottish Government to provide better guidance on baseline assumptions, we have now explicitly laid out a new approach for setting policy baselines in the absence of clear information from the government. This work improves the transparency and consistency of our forecasts and the Scottish Budget process. It was well received by stakeholders as good news for budget scrutiny. 

Through our Statement of Data Needs reports, we provide recommendations on how our data providers can align their data developments with the practices for production and dissemination of official statistics. By being clear with our supply partners and users about our priorities for improving data, we enhance the transparency and quality of our work and that of the data we use. We also encourage data providers to publish as much detailed data as possible so that wider users can benefit. 

We produce quality work which informs policy making and public debate

We aim to improve information on devolved public finances available to decision makers, and to enrich the fiscal policy debate in Scotland. 

In response to suggestions from the OECD and requests from the Scottish Parliament’s Finance and Public Administration Committee, we’ve started producing  Fiscal Sustainability reports. By producing these 50-year projections of Scottish Government spending and funding, we’ve been able to highlight key risks to the Scottish Budget from longterm challenges such as an ageing population or the cost of policies to tackle climate change. We explained our findings to a broad range of stakeholders and prompted a wider and honest conversation about priorities for fiscal sustainability. 

We’ve also begun work looking at Scottish Government spending plans, in addition to our commentary on funding. Earlier this year, we published new spending analysis to compare government spending over time on a consistent basis, enhancing the transparency of budget data and making it easier for Committees to scrutinise government spending plans. The Finance and Public Administration Committee welcomed this new analysis and our plans to develop it further. This work also added value for the general audience, and in the media it was credited for bringing clarity into tracking how public money is being spent.  

We are always keen to receive feedback from users and hear views on how we can improve, so drop us an email at info@fiscalcommission.scot if you wish to get in touch. 

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