'No business case' for Police Scotland, says Audit Scotland

The new single force came into existence on 1 April

It is still not clear how Scotland's new single police force plans to make the expected £1.1bn of savings by 2026, the public spending watchdog has said.

The country's eight forces merged into Police Scotland in April.

Audit Scotland said a full business case was lacking, and the merger had been hampered by disputes between the Scottish government, Police Scotland and the Scottish Police Authority.

The Scottish government said the report was out of date.

Holyrood's Justice Secretary, Kenny MacAskill, said: "This report provides a snapshot of where the reform process was earlier this year. It does not reflect the considerable work which has been undertaken since then."

The creation of a single police force was one of the biggest reforms in Scotland's public sector since devolution, and the biggest change to Scottish policing for more than 40 years.

The restructure transferred about £1.1bn of annual spending and more than 24,000 people, including 17,496 police officers, into the new Police Scotland and Scottish Police Authority.

It also transferred responsibility for policing from local government to central government.

Although not a stated objective of reform, one of the main drivers was to save money, with savings of £1.1bn expected by 2026.

But Audit Scotland said it was not yet clear how this would be achieved.

It said the costs and savings estimates for the reforms were based on the outline business case prepared by the Scottish government in September 2011.

But these estimates were not updated, and a full business case had not been prepared.

The report said the Scottish Parliament finance committee had received an assurance from the Scottish government that the police service was leading on developing a full business case to provide greater accuracy of the costs and savings from reform.

But it added: "The development of a full business case, based on the creation of a single police service, was not carried out."

The SPA and Police Scotland have still to finalise and agree a financial strategy showing how savings will be achieved beyond 2013/14, it stated.

The report said Police Scotland may have to find an additional £21m of savings above the original business plan next year, and a further £112m from 2016/17 to 2018/19.

Many savings are expected to come from reducing police staff costs but further savings may be challenging through the "lack of flexibility" in managing staff and officer numbers, according to Audit Scotland.

Caused delays

The report said: "The SPA and Police Scotland face continuing challenges in delivering the savings required. Their limited flexibility in managing police officer and staff numbers and delays in decision-making contribute to this.

"Government policies to maintain police officer numbers at 17,234 and no compulsory redundancies for police staff limit the SPA's and Police Scotland's flexibility to deliver savings.

"The slow progress in developing a workforce strategy and agreeing voluntary redundancies or early retirements increase the risk that savings will not be delivered in time."

Disputes among the police, SPA and the Scottish government over the structure of the force, and several senior staff changes at the SPA, have caused delays and presented challenges in achieving the necessary savings, the watchdog said.

In one example, it noted that the SPA's interim headquarters at Bremner House in Stirling has been lying empty for more than a year at an annual rental cost of £132,000.

"There have been difficult relationships between the Scottish government, the SPA and Police Scotland throughout the reform process," the report said.

"These difficulties have resulted in considerable time being spent in meetings to resolve areas where there have been disagreements. Considerable work is now required to build mutual confidence, trust and respect."

'Ongoing process'

Mr MacAskill insisted roles and responsibilities had now been agreed, savings were on track for the year, early release schemes had been agreed, and the development of a financial strategy was at an advanced stage.

The minister added: ‪"We have always said that reform is an ongoing process, change of this scale is almost unprecedented and there were always going to be challenges.

"We acknowledged that earlier this year and acted decisively to support the SPA and Police Scotland in working together to successfully resolve those issues.‬

‪"We will now give careful consideration to the recommendations within the report."

Vic Emery, chairman of the SPA, said there was now a "strong consensus" on respective roles and responsibilities.

He added: "The quality of information is improving in both content and presentation, and this will support SPA and Police Scotland to develop a three-year financial strategy before the end of this current financial year.

'Hugely challenging'

"All of us who entered into police reform did so with eyes wide open. We understood the Scottish government's commitments to retain police officer numbers at their current levels, and a policy of no compulsory redundancies.

"This will make achieving future savings hugely challenging and there is a lot of hard work ahead of us. However, the first milestone in achieving savings in future years is to make sure we balance the books in year one.

"We are confident that we will deliver all the savings required of us in this first year, and to do so with policing continuing to perform effectively for the people of Scotland."

Police Scotland Deputy Chief Constable Neil Richardson said: "The process of change is only just beginning and while much has already been achieved there is much more to be done in partnership to deliver an efficient, modern policing service within the challenges of the financial constraints.

"Police Scotland must work within its budget - the same as all other public services and businesses. As already publicly highlighted we are confident of meeting our financial savings for year one."

But Hugh Henry, the convener of the Public Audit Committee at the Scottish Parliament, said: "One of the main drivers for police reform was to save £1.1bn by 2026."

The Labour MSP said: "I am surprised to learn that no full business case was prepared to support this, nor was robust baseline information developed to measure progress. How then can the public be certain that savings are actually being made and targets met?"