Committee
Public Audit Committee 17 December 2025
17 Dec 2025 · S6 · Public Audit Committee
Item of business
Section 22 Report: “The 2024/25 audit of the Scottish Government Consolidated Accounts”
Carole Grant (Audit Scotland)
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As the Auditor General has said, the underspend has capital and resource elements. The resource underspend of £875 million—or 1.6 per cent—includes non-cash elements, such as financial transactions. The largest resource variances are detailed within our annual audit report at paragraph 62. The first related to the finance and local government portfolio. A contingency was held for year-end adjustments or non-cash elements.
There was also an underspend in the transport portfolio of about £200 million, and that related the trunk road network, ferries and rail services. The final underspend was in the social justice portfolio, and was linked to social security, including assistance but also cladding, which I know has been a matter of interest.
The capital variances in percentage terms were higher, at 5.3 per cent, but the total underspend was £134 million. That was largely within the Deputy First Minister, economy and Gaelic portfolio, partly due to the Scottish National Investment Bank underspend within the year.
Regarding the amount that is carried forward within the Scotland reserve, we go into some detail on that at paragraph 67 of our annual audit report. Currently, on the back of the provisional outturn, the amount carried forward is £557 million, which will be used in future budget years.
In the same item of business
The Convener
Lab
Our main agenda item this morning is consideration of a section 22 report on the 2024-25 audit of the Scottish Government’s consolidated accounts. I am pleas...
Stephen Boyle (Auditor General for Scotland)
Many thanks indeed, convener, and good morning. I am presenting this report on the 2024-25 audit of the Scottish Government’s consolidated accounts under sec...
The Convener
Lab
Thank you very much indeed. On your final point, I am sure that we will take full evidence from you in due course on the report that came out yesterday. None...
Stephen Boyle
I will give you a response, but I will turn to Carole Grant in a moment, as she may want to set out some of the detail behind the underspend. The consolidate...
Carole Grant (Audit Scotland)
As the Auditor General has said, the underspend has capital and resource elements. The resource underspend of £875 million—or 1.6 per cent—includes non-cash ...
The Convener
Lab
Okay. Can I just interrogate that a little bit more? On the social justice underspend of £164 million, are you saying that that is unspent money on cladding ...
Carole Grant
It is. The social justice portfolio covers both social security and assistance, so not only payments made but the Scottish Government team for the delivery o...
The Convener
Lab
I say this without getting us into policy areas, but Parliament will consider legislation that is about raising a levy to pay for cladding remediation. What ...
Stephen Boyle
We are, convener. Both things can be true at the same time, recognising that there will be some timing differences in the delivery of certain Government prio...
The Convener
Lab
Okay, but people such as me and Mr Simpson have a longstanding question that we have raised about the fact that there were Barnett consequentials from action...
Stephen Boyle
Yes, I am happy to start. I will explain why there is a qualification, and I will bring Carole Grant in on some of the forward look around this. Social sec...
Carole Grant
On the size of the estimated overpayment for error and fraud within the DWP-administered benefits, it is reducing, as you would expect, as case transfer happ...
The Convener
Lab
Okay, thank you. Other members of the committee may want to ask questions on that part of the report. I will move to another area. One comment in the report...
Stephen Boyle
We highlight it in the report as an area that the Scottish Government needs to pay more attention to in terms of strengthening the controls and approval arra...
Richard Smith (Audit Scotland)
As the Auditor General highlights, it was an extreme case and that is why we pulled it out to illustrate the point about the approval arrangements. Currently...
The Convener
Lab
Wow. In the report, you speak about the individual earning—I use the term loosely—£85,000 for four months’ work. You have just said that they earned £220,000...
Stephen Boyle
You are right, convener. These are significant amounts of public expenditure, and there was a real difference with what the person was earning while they wer...
The Convener
Lab
Yes, and obviously, as a committee, we will consider who else we may want to take evidence from on this report, up to and including the permanent secretary. ...
Stephen Boyle
I do not know whether I have enough evidence to give a definitive yes or no answer on that. There are clearly stronger and more robust arrangements in place ...
The Convener
Lab
Okay. The deputy convener, who I will turn to next, has some questions on one of those projects. My final question for now is about risk management. In par...
Stephen Boyle
I will try to address all your points. I am happy to talk in more detail about risk management generally across the Scottish Government, where we have given ...
The Convener
Lab
Okay. My final question is: as the Auditor General, what is your view of a company that does not have auditors and has not filed accounts with Companies House?
Stephen Boyle
I think that I have put that on record; you asked a related question, either 12 months ago or the year before. Clearly, it is a significant gap. All bodies, ...
The Convener
Lab
Thank you very much, and thanks for answering those questions. I now invite the deputy convener to put his questions to you.
Jamie Greene (West Scotland) (LD)
LD
Good morning. I will carry on where the convener left off with questions about the strategic commercial assets. It will not be a huge surprise that I would l...
Stephen Boyle
I will bring Carole Grant in to set out some of this in detail. There are differences in funding that have gone into the investment and that is reflected in ...
Carole Grant
Thank you. On the detail that is in exhibit 1, the £99 million in relation to the value in the accounts includes £55 million for Glen Sannox that has now bee...
Jamie Greene
LD
What I am asking, I suppose, is that if this business were to be sold as a going concern by the Scottish Government to a private company, what would its valu...
Stephen Boyle
That would be the valuation of the vessels and so not necessarily a valuation of the business, which might include other factors. There will be an aspect of ...
Jamie Greene
LD
We have to assume, therefore, that once those projects are complete and the Glen Rosa has set sail and been handed over to its client, that will come off the...