Agenda Pack
North Lanarkshire Council · 13 March 2023
Back to Glasgow and the Clyde Valley Strategic Development Planning Authority Joint Committee — 13 March 2023 and its agenda
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06/03/2023 Notice of Meeting and Agenda Glasgow & the Clyde Valley Strategic Development Planning Authority Joint Committee. Date Time Venue Monday, 13 March 2023 11:15 Remotely by MS Teams, Membership Councillor Jim Gibbons and Councillor Alan Moir (East Dunbartonshire Council); Councillor Paul Edlin and Councillor Colm Merrick (East Renfrewshire Council); Councillor Kenny McLean and Councillor Ken Andrew (Glasgow City Council); Councillor Chris Curley and Councillor David Wilson (Inverclyde Council); Councillor Tom Fisher and Councillor Allan Stubbs (North Lanarkshire Council); Councillor John McNaughtan and Councillor Jim Paterson (Renfrewshire Council); Councillor Richard Nelson and Councillor Robert Brown (South Lanarkshire Council); and Councillor Lawrence O’Neill and Councillor Gurpreet Singh Johal (West Dunbartonshire Council). Councillor Lawrence O’Neill (Convener); Councillor David Wilson (Vice-Convener). Further Information - online meetings only This meeting is on-line only but is a meeting which is open to members of the public by prior arrangement. A copy of the agenda and reports for this meeting will be available for inspection prior to the meeting at the Customer Service Centre, Renfrewshire House, Cotton Street, Paisley and online at http://renfrewshire.cmis.uk.com/renfrewshire/CouncilandBoards.aspx For further information, please email democratic-services@renfrewshire.gov.uk MARK CONAGHAN Clerk Page 1 of 72
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06/03/2023 Members of the Press and Public - contact details Members of the press and public wishing to attend the meeting should contact democratic- services@renfrewshire.gov.uk to allow the necessary arrangements to be made. Page 2 of 72
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06/03/2023 Items of business Apologies Apologies from members. Declarations of Interest Members are asked to declare an interest in any item(s) on the agenda and to provide a brief explanation of the nature of the interest. 1 Minute Minute of meeting of this Joint Committee held on 12 December 2022. 5 - 10 2 Revenue Budget Monitoring Joint report by Treasurer and Strategic Development Plan Manager. 11 - 12 3 Revenue Estimates 2023/24 for Clydeplan and the Green Network Partnership Joint report by Treasurer and Strategic Development Plan Manager. 13 - 18 4 Audit Plan 2022/23 Report by Treasurer. 19 - 56 5 Annual Report 2022 Report by Strategic Development Plan Manager. 57 - 64 6 Planning (Scotland) Act 2019 - Adoption of National Planning Framework 4 Report by Strategic Development Plan Manager. 65 - 72 7 Date of Next Meeting Note that the next meeting of this Joint Committee will be held at 11.15 am on 12 June 2023. Page 3 of 72
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Minute of Meeting Glasgow & the Clyde Valley Strategic Development Planning Authority Joint Committee. Date Time Venue Monday, 12 December 2022 11:15 Remotely by MS Teams, Present Councillor Paul Edlin and Councillor Colm Merrick (East Renfrewshire Council); Councillor Kenny McLean and Councillor Ken Andrew (Glasgow City Council); Councillor Allan Stubbs (North Lanarkshire Council); Councillor John McNaughtan and Councillor Jim Paterson (Renfrewshire Council); Councillor Robert Brown (South Lanarkshire Council); and Councillor Lawrence O’Neill and Councillor Gurpreet Singh Johal (West Dunbartonshire Council). Chair Councillor O’Neill, Convener, presided. In Attendance S Tait, Strategic Development Plan Manager and D McDonald, Assistant Development Plan Manager (both Strategic Development Plan Core Team); A Corbett, Green Network Development Officer (Green Network Partnership); H Holland, Executive Officer - Land Planning & Development (East Dunbartonshire Council); J Nicol, Planning & Building Standards Manager (East Renfrewshire Council); S Taylor, Principal Planner (Glasgow City Council); S Jamieson, Head of Regeneration and Planning (Inverclyde Council); L Bowden, Planning & Place Manager (North Lanarkshire Council); A Morrison, Head of Economy and Development Services, K Festorazzi, Principal Accountant (Management Accounting) and E Currie, Senior Committee Services Officer (all Renfrewshire Council); T Finn, Planning & Building Services Headquarters Manager (South Lanarkshire Council); and A Williamson, Development Planning and Place Team Leader (West Dunbartonshire Council). Item 1 Page 5 of 72
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Apologies Councillor David Wilson (Inverclyde Council); Councillor Tom Fisher (North Lanarkshire Council); and Councillor Richard Nelson (South Lanarkshire Council). Declarations of Interest There were no declarations of interest intimated prior to the commencement of the meeting. 1 Minutes There were submitted the Minutes of the meetings of this Joint Committee held on 12 September and 24 October 2022. DECIDED: That the Minutes be approved. 2 Revenue Budget Monitoring There was submitted a joint revenue budget monitoring report by the Treasurer and the Strategic Development Plan Manager for the period to 11 November 2022. The report intimated that by 31 March 2023, the forecast position for Clydeplan was a projected underspend of £99,236 and further detail was provided in section 4 of the report. The report noted that there had been no budget adjustments since the start of the financial year. DECIDED: That the report be noted. 3 Revenue Estimates 2023/24 for Clydeplan and the Green Network Partnership There was submitted a joint report by the Treasurer and the Strategic Development Plan Manager relative to the revenue estimates of the Glasgow and the Clyde Valley Strategic Development Planning Authority (Clydeplan) and the Green Network Partnership, including the requisition of the constituent authorities for financial year 2023/24 and indicative planning figures for 2024/25 and 2025/26, as detailed in the appendix to the report. The report intimated that both Clydeplan and the Green Network Partnership budgets were presented together in recognition of their shared activity and resources. The report advised that the financial environment in which the Joint Committee and constituent authorities operated continued to be characterised by significant demand and cost pressures, compounded by constrained grant support. It was anticipated that the Scottish budget, to be announced on 15 December 2022, would again reflect a settlement for local government which potentially did not meet the levels required to maintain spend under the current high inflationary climate. Page 6 of 72
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The report further advised that the requisition for Clydeplan was proposed at £67,500 per constituent authority. This maintained the gross requisition at 2022/23 levels with a requisition discount of £39,500 applied in recognition of the high level of uncommitted reserves. Further, that the allocation basis for the Green Network Partnership was a per capita allocation which differed to Clydeplan. The proposed net requisitions for 2023/24 and beyond had been discounted to reduce the level of reserves held within the Green Network Partnership to a reasonable level. The report provided information on the assumptions that the budget had been based on and a financial overview for Clydeplan. In relation to the budget assumption ‘provision of inflation on employee costs has been included at an average 5% for 2022/23 and 3% for subsequent years’, it was proposed that the figure of 3% would not be sufficient for subsequent years and that the Treasurer be requested to submit a report to the next meeting of this Joint Committee providing options with figures greater than 3%. This was agreed. DECIDED: That the Treasurer be requested to submit a report to the next meeting of this Joint Committee providing options with figures greater than 3%. 4 Revised Draft National Planning Framework 4 Under reference to item 4 of the Minute of the meeting of this Joint Committee held on 12 September 2022, there was submitted a report by the Strategic Development Plan Manager advising that the Scottish Government had laid the revised draft National Planning Framework 4 (NPF4) in Parliament on 8 November 2022 and requesting that the Joint Committee consider the Clydeplan Core Team staffing implications in support of the future delivery of the Regional Spatial Strategy (RSS) and wider city region joint working agenda. The report intimated that NPF4 was a long-term plan for Scotland to 2045 that set out where development and infrastructure was needed and that for the first time, once approved, would form part of the statutory Development Plan along with the Local Development Plan. In a regional context, the Planning (Scotland) Act 2019 set out a duty for one or more local authorities to prepare an RSS, though unlike its predecessor, the Strategic Development Plan, the RSS would not form part of the statutory Development Plan. The report noted that the revised draft NPF4 had been laid in the Scottish Parliament for a period of parliamentary scrutiny and that there had been two sessions of evidence given to the Local Government, Housing and Planning Committee on 22 and 29 November 2022. The next stages would be a debate by the Scottish Parliament and vote with a view to being ‘approved’ by Parliament, likely to be within the next few weeks and then Scottish Ministers would ‘adopt’ and ‘publish’ NPF4 as soon as practically possible, likely to be January/February 2023. The report provided detail on the draft NPF4 consultation; the three parts of the revised draft NPF4; Regional Spatial Strategies and guidance; the Delivery Programme and the Strategic Development Plan Managers observations. Page 7 of 72
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The report advised that the Clydeplan Core Team was the Joint Committee’s staffing resource which, on behalf of the eight constituent members, would lead the development of the RSS. The Core Team staffing structure was detailed in the report and it was noted that the Clydeplan Manager also had line management responsibility for the Green Network Development Officer, the Green Network Communications Officer and the Green Network Grassland and Wetland Development Lead. Both the Clydeplan Manager and the Assistant Manager had indicated their intention to retire in April 2023 and December 2022, respectively. The report proposed that a review of the Clydeplan Core Team staffing structure be undertaken, led by the Chair of the Clydeplan Steering Group, to consider how the organisation could best support the new planning legislation and regional joint working agenda with a report being submitted to a future meeting of this Joint Committee. This was agreed. DECIDED: (a) That the publication of the revised draft NPF4 and timetable for parliamentary scrutiny be noted; (b) That the Scottish Government’s timetable for the preparation of RSS guidance be noted; and (c) That given upcoming retirements, the staffing structure of the Clydeplan Core Team be reviewed to take account of the implications of the new regional and local planning duties arising from the Planning (Scotland) Act 2019 and the wider city region joint working agenda and that a further report be brought back to a future meeting of this Joint Committee. 5 Partnership Working Towards Delivery of the Green Network Blueprint There was submitted a report by the Green Network Development Officer providing an update on progress towards delivery of the Green Network ‘Blueprint’ and other strategic work relating to the Glasgow City Region Green Network. The report intimated that the twin and interlinked climate and ecological crises had never had a higher public and political focus and that this was reflected in the emphasis placed on them in the revised draft NPF4 and the suite of supporting guidance and strategies. Nature Networks, Active Travel Networks and overarching Green Networks were cited as an effective response to the crises in these documents, particularly when considered at a landscape scale, and the Glasgow City Region Green Network was ideally placed to support partners in meeting new requirements and, where appropriate, developing a consistent regional approach. The Green Network Development Officer gave a presentation providing further detail in relation to the Strategic Environment Partnership (SEP); Blueprint delivery projects and the Glasgow City Region. DECIDED: That the report and presentation be noted. Page 8 of 72
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6 Date of Next Meeting DECIDED: That it be noted that the next meeting of the Joint Committee would be held at 11.15 am on 13 March 2023 and that members be advised if this meeting would be held remotely using MS teams or would be an ‘in person’ meeting. Valedictory The Convener advised that this was the last meeting of the Joint Committee Dorothy McDonald would attend before her retirement and took the opportunity to thank Dorothy for her professionalism and, specifically the help, support and advice she had provided to himself and members during her employment with Clydeplan. On behalf of the Joint Committee, the Convener thanked Dorothy for guiding Clydeplan through the SDP and a legal challenge and advised her that it was an honour to work with her. Dorothy thanked members of the Joint Committee and advised that she had enjoyed her time with Clydeplan and was sad to be leaving. She thanked officers in Renfrewshire Council for their support and thanked Stuart Tait, in particular, mentioning that he as a tremendous manager. Page 9 of 72
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GLASGOW AND THE CLYDE VALLEY STRATEGIC DEVELOPMENT PLANNING AUTHORITY JOINT COMMITTEE To: Joint Committee On: 13 March 2023 ___________________________________________________________________ Report by: The Treasurer and the Strategic Development Plan Manager ___________________________________________________________________ Heading: Revenue Budget Monitoring Report to 03 February 2023 ___________________________________________________________________ 1. Summary 1.1 The forecast position for ClydePlan by 31 March 2023 is a projected underspend of £137k, as explained in section 4. ______________________________________________________________ 2 Recommendations 2.1 It is recommended that Members consider the report. _____________________________________________________ 3 Budget Adjustments Since Last Report 3.1 There have been no budget adjustments since the start of the financial year. ________________________________________________________________ 4 Budget Performance 4.1 Projected Year-end Position £137k Favourable variance to budget Previously Reported £99k Favourable variance to budget The movement in projected underspend from the last reporting period is largely within Employee Costs, due to the retirement of the Assistant Manager as well as vacancies that have not yet been filled, including one Strategic Planner posts and one Planning Analyst post. ___________________________________________________________________ Item 2 Page 11 of 72
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Core Operations Approved
Budget
Year to Date
Actual
Projected Full
Year Actual
Projected Full
Year Variance
(Adverse) /
Favourable
Prior Period
Projected Full
Year Actual
Movement in
Projection
Adverse /
(Favourable)
£000 £000 £000 £000 £000 £000
Employee Costs 474 314 380 94 420 (40)
Property Costs 22 1 3 19 3 0
Transport Costs 1 0 0 1 0 0
Supplies and Services 27 24 35 (8) 30 5
Transfer Payments 32 2 2 30 3 0
Support Costs 24 1 25 (1) 25 (0)
Gross Expenditure 580 342 446 134 481 (34)
Council Requisitions (547) (547) (547) 0 (547) 0
Other Income (3) (3) (6) 3 (3) (3)
Gross Income (550) (550) (553) 3 (550) (3)
TRANSFER (TO)/FROM RESERVES 30 (209) (107) 137 (69) (38)
£000
Opening Revenue Reserve at 1 April 2022 (314)
Budgeted Draw on Reserves 30
Projected Year-end variance (137)
Closing Revenue Reserve at 31 March 2023 (421)
% of Operating Income 76.1%
Glossary
Employee Costs: Includes direct employee costs such as salary costs, overtime and indirect employee costs such as training, recruitment advertising
Property Costs: Includes expenses directly related to the running of premises and land, eg rates, rents and leases, utilities, contract cleaning
Transport Costs: Includes all costs associated with the provision, hire or use of transport, including travelling allowances, taxi and car hire costs and staff mileage
Supplies and Services: Includes all supplies and service expenses, such as ICT costs, and administrative costs such as stationery, postages, printing and advertising
Transfer Payments: Includes costs of payments for which no good or services are received in return e.g. Apprenticeship Levy
Support Costs: Includes central support charges e.g. Renfrewshire Council SLA and telephony recharges ('Administration Costs' in approved budget)
REVENUE BUDGET MONITORING STATEMENT 2022/23
1 April to 3 February 2023
Summary of in-year Movement in Reserves
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GLASGOW AND THE CLYDE VALLEY STRATEGIC DEVELOPMENT PLANNING AUTHORITY JOINT COMMITTEE To: Joint Committee On: 13 March 2023 ___________________________________________________________________ Report by: The Treasurer and the Strategic Development Plan Manager ___________________________________________________________________ Heading: Revenue Estimates 2023/24 for ClydePlan and the Green Network Partnership – Options ___________________________________________________________________ 1. Summary 1.1 The following report has been prepared by the Treasurer, in consultation with the Strategic Development Plan Manager, to present the Revenue Estimates of Glasgow and the Clyde Valley Strategic Development Planning Authority and Green Network Partnership, including the requisition of the constituent authorities, for financial year 2023/24. 1.2 In December 2022, the Joint Committee did not approve the proposed Revenue Estimates for 2023/24 and instead requested to see options based on different levels of assumed pay inflation. ___________________________________________________________________ 2. Recommendations 2.1 It is recommended that Members select one option from the range set out in Appendix 1 – 3, which includes the resulting requisitions of the constituent authorities for 2023/24, and the planned use of reserves. ___________________________________________________________________ 3. Background 3.1 The Revenue Estimates process outlines the summary revenue budget position each year. Both ClydePlan and the Green Network Partnership (GNP) budgets are presented together, in recognition of their shared activity and resources. 3.2 The Revenue Estimates, outlining the projected net expenditure and proposed requisition for 2023/24, along with indicative figures 2024/25 and 2025/26 were presented to Members on 15 December 2022. Estimates at that time were based on a 3% pay inflation assumption and can be found replicated here as Option 1. Members requested additional options to allow a 2023/24 budget to be approved. This paper focuses only on those options, as Item 3 Page 13 of 72
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information about the financial context and outlook were detailed in the December paper. 3.3 The Appendix to this report therefore outlines the following options: • Option 1 outlines the estimates that were presented at the Joint Committee meeting on 15 December 2022 and is based on a pay inflation assumption of 3% for all three years shown, and a requisition discount; • Option 2 outlines the estimates for Clydeplan and GNP with a pay inflation assumption of 5%, and preserves the same requisition level as Option 1 for 2023/24; • Option 3 outlines the estimates for Clydeplan and GNP with a pay inflation assumption of 5%, and preserves the same reserves balance as Option 1, by a change in requisition discount to compensate for the additional cost. 3.4 The requisition for ClydePlan is dependant on the option chosen from the appendices: • Option 1 results in a reduction in requisition from 2022/23 levels of 1.3% for ClydePlan and 2.6% for GNP and reserves are forecast at £0.360m by the end of 2023/24; • Option 2 results in the same reduction in requisition levels since 2022/23 and reserves are forecast at £0.353m by the end of 2023/24; • Option 3 results in a reduction in requisition from 2022/23 of 0.5% for ClydePlan and an increase of 0.5% for GNP and reserves are forecast at £0.360m by the end of 2023/24. 4. Budget Assumptions 4.1 The budget has been constructed on the basis of a fundamental review of the core operations of Clydeplan and Green Network Partnership and is based on the following assumptions: • Option 1 - Provision for inflation on employee costs has been included at 3% for 2022/23 and 3% for subsequent years; • Option 2 and Option 3 - Provision for inflation on employee costs has been included at 5% for 2022/23 and 5% for subsequent years. Page 14 of 72
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5. Reserves 5.1 The Audited Annual Accounts for 2021/22 reported the level of uncommitted reserves as £314,108 for ClydePlan at 31 March 2022. The latest forecast for 2022/23 projects this balance to be £335,838 by 31 March 2023. 5.2 The Audited Annual Accounts 2021/22 reported the level of uncommitted reserves as £99,630 for the Green Network Partnership at 31 March 2022. The latest forecast for 2022/23 projects this balance to be £100,140 by 31 March 2023. 5.3 The Appendix outlines the impact of each option on the projected level of reserves. ___________________________________________________________________ Page 15 of 72
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Appendix 1 ClydePlan GNP Total ClydePlan GNP Total ClydePlan GNP Total Expenditure Employee Costs 489,400 141,200 630,600 493,400 144,200 637,600 493,400 144,200 637,600 Premise Costs 20,100 500 20,600 20,100 500 20,600 20,100 500 20,600 Supplies and Services 27,400 7,300 34,700 27,400 7,300 34,700 27,400 7,300 34,700 Support Services 23,700 300 24,000 23,700 300 24,000 23,700 300 24,000 Transfer Payments 1,900 600 2,500 1,900 600 2,500 1,900 600 2,500 Transport 500 300 800 500 300 800 500 300 800 Total Expenditure 563,000 150,200 713,200 567,000 153,200 720,200 567,000 153,200 720,200 Income Gross Requisition 579,500 143,685 723,185 579,500 143,685 723,185 579,500 143,685 723,185 Requisition discount (39,500) (50,000) (89,500) (39,500) (50,000) (89,500) (35,500) (47,000) (82,500) Net Requisition 540,000 93,685 633,685 540,000 93,685 633,685 544,000 96,685 640,685 Other Income 3,000 800 3,800 3,000 800 3,800 3,000 800 3,800 Total Income 543,000 94,485 637,485 543,000 94,485 637,485 547,000 97,485 644,485 Net Expenditure / (Income) 20,000 55,715 75,715 24,000 58,715 82,715 20,000 55,715 75,715 Reserve Balances General Reserves at 1 April 335,838 100,140 435,978 335,838 100,140 435,978 335,838 100,140 435,978 Transfer of Clydeplan Reserves to GNP (47,500) 47,500 0 (47,500) 47,500 0 (47,500) 47,500 0 Use of Reserves Other (20,000) (55,715) (75,715) (24,000) (58,715) (82,715) (20,000) (55,715) (75,715) Total Reserves at 31 March 268,338 91,925 360,263 264,338 88,925 353,263 268,338 91,925 360,263 Reserves as % of gross revenue spend 48% 61% 46.6% 58.0% 47.3% 60.0% Change in Net Requisition -1.3% -2.6% -1.3% -2.6% -0.5% 0.5% Net Requisition per Authority: City of Glasgow Council 67,500.00 31,118.60 98,618.60 67,500.00 31,118.60 98,618.60 68,000.00 32,115.08 100,115.08 North Lanarkshire Council 67,500.00 17,361.70 84,861.70 67,500.00 17,361.70 84,861.70 68,000.00 17,917.66 85,917.66 South Lanarkshire Council 67,500.00 16,550.35 84,050.35 67,500.00 16,550.35 84,050.35 68,000.00 17,080.33 85,080.33 East Dunbartonshire Council 67,500.00 5,606.39 73,106.39 67,500.00 5,606.39 73,106.39 68,000.00 5,785.92 73,785.92 West Dunbartonshire Council 67,500.00 4,871.02 72,371.02 67,500.00 4,871.02 72,371.02 68,000.00 5,027.00 73,027.00 East Renfrewshire Council 67,500.00 4,772.64 72,272.64 67,500.00 4,772.64 72,272.64 68,000.00 4,925.47 72,925.47 Inverclyde Council 67,500.00 4,335.31 71,835.31 67,500.00 4,335.31 71,835.31 68,000.00 4,474.14 72,474.14 Renfrewshire Council 67,500.00 9,068.99 76,568.99 67,500.00 9,068.99 76,568.99 68,000.00 9,359.40 77,359.40 540,000.00 93,685.00 633,685.00 540,000.00 93,685.00 633,685.00 544,000.00 96,685.00 640,685.00 Revenue Estimates 2023/24 ClydePlan and Green Network Partnership Option 3Option 2Option 1 Page 17 of 72
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GLASGOW AND THE CLYDE VALLEY STRATEGIC DEVELOPMENT PLANNING AUTHORITY JOINT COMMITTEE To: Joint Committee On: 13 March 2023 ___________________________________________________________________ Report by: The Treasurer ___________________________________________________________________ Heading: Annual Audit Plan 2022/23 ___________________________________________________________________ 1. Background The Annual Audit Plan 2022/23 for the Joint Committee is submitted for Members’ information, prepared by the appointed external auditor, Azets. It outlines their planned activities during the audit of the 2022/23 annual accounts. __________________________________________________________________________________ 2. Recommendations 2.1 It is recommended that the Members: a) note the Annual Audit Plan 2022/23 by Azets, as attached; and b) approve the proposed audit fee of £5,780. ___________________________________________________________________ 3. Background 3.1 Based on its analysis of the risks facing ClydePlan, Azets has submitted an Audit Plan that outlines its approach to the audit of the 2022/23 annual accounts. This will assess whether the accounts provide a true and fair view of the organisation’s financial position, and also whether they have been prepared in accordance with proper accounting practice, i.e. the Code of Practice on Local Authority Accounting in the UK 2022/23. 3.2 The Audit Plan outlines the responsibilities of ClydePlan and of Azets; its assessment of key challenges and risks and the approach and timetable for completion of the audit. The risks identified here are included in the audit plans of many bodies that Azets work with and their inclusion is not a reflection of any specific risk within ClydePlan. Item 4 Page 19 of 72
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3.3 The statutory deadline for the approval of the audited accounts for 2022/23 is 30 September 2023 and the annual audit report is planned to be reported to the Joint Committee on 11 September 2023. 3.4 On pages 20-21 of the Audit Plan, the proposed audit fee is detailed. This is indicated at £5,780 for the current financial year and represents a local increase above the 12.5% uplift set by Audit Scotland for 2022/23. 3.5 Within the terms of the Audit Scotland appointment, local audit teams have discretion to vary the fee by up to 10% above the level set depending on the level of identified audit risk. This proposed higher fee reflects the additional work required in the first year of a new audit appointment. 3.6 From Azets, Senior Manager, Adrian Kolodziej will be in attendance at the meeting to present the Audit Plan, attached here as an appendix. Page 20 of 72
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Glasgow and Clyde Valley Strategic Development Planning Authority External Audit Annual Plan 2022/23 March 2023 Page 21 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 2 Table of Contents Introduction 3 Audit scope and general approach 4 Significant and other risks of material misstatement 11 Wider scope 15 Your Azets audit management team 17 Audit timetable 18 Audit fee 20 Audit independence and objectivity 22 Appendix 1: Responsibilities of the Auditor and Clydeplan 23 Appendix 2: Potential impact on Clydeplan and our audit approach following revisions to auditing standards 30 Appendix 3: Materiality 33 Page 22 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 3 Introduction Azets have been appointed by Audit Scotland as the external auditor to Glasgow and the Clyde Valley Strategic Development Planning Authority (“Clydeplan”) for the period 2022/23 to 2026/27. This document summarises the work plan for our 2022/23 external audit of Clydeplan. The core elements of our work include: • An audit of the 2022/23 annual accounts and related matters; • Consideration of the wider scope areas of public audit work as they apply to less complex bodies; • Any other work requested by Audit Scotland. We expect that our audit will have a similar underlying approach to that of your previous external auditor, Audit Scotland, although there are some changes to the Code of Audit Practice and auditing standards that come into effect for the first time in 2022/23, which are reflected in this document. Adding value All of our clients quite rightly demand of us a positive contribution to meeting their ever-changing business needs. We will add value by being constructive and forward looking, by identifying areas of improvement and by recommending and encouraging good practice. In this way we aim to promote improved standards of governance, better management and decision making and more effective use of public money. Any comments you may have on the service we provide would be greatly appreciated. Comments can be reported directly to any member of your audit team. Openness and transparency This report will be published on Audit Scotland’s website www.audit-scotland.gov.uk. Page 23 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 4 Audit scope and general approach Responsibilities of the auditor and Clydeplan The Code of Audit Practice outlines the responsibilities of external auditors appointed by the Accounts Commission and it is a condition of our appointment that we follow it. Auditor responsibilities are derived from statute, International Standards on Auditing (UK) and the Ethical Standard for auditors, other professional requirements and best practice, the Code of Audit Practice and guidance from Audit Scotland. Clydeplan has primary responsibility for ensuring the proper financial stewardship of public funds. This includes preparing annual accounts that are in accordance with proper accounting practices. Clydeplan is also responsible for compliance with legislation and putting arrangements in place for governance and propriety that enable it to successfully deliver its objectives. Appendix 1 provides further detail of both our responsibilities and those of Clydeplan. Risk-based audit approach We follow a risk-based approach to the audit that reflects our overall assessment of the relevant risks that apply to Clydeplan. This ensures that our audit focuses on the areas of highest risk. Our audit planning is based on: Discussions with senior officers Our understanding of the sector, its key priorities and risks Attendance at the Joint Committee Guidance from Audit Scotland Discussions with Audit Scotland and other public sector auditors Consideration of the work of internal audit Review of Clydeplan’s corporate strategies and plans Review of Clydeplan’s corporate risk register Outcomes of prior year audits Page 24 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 5 Planning is a continuous process and our audit plans are updated during the course of our audit to take account of developments as they arise. Communication with those charged with governance Auditing standards require us to make certain communications throughout the audit to those charged with governance. These communications will be through Glasgow and the Clyde Valley Strategic Development Planning Authority’s Joint Committee (“the Joint Committee”). Professional standards and guidance We perform our audit of the financial statements in accordance with International Standards on Auditing UK (ISAs (UK)),Ethical Standards, and applicable Practice Notes and other guidance issued by the Financial Reporting Council (FRC). Partnership working We coordinate our work with Audit Scotland, internal audit, other external auditors and relevant scrutiny bodies, recognising the increasing integration of service delivery and partnership working within the public sector. Audit Scotland Although we are independent of Audit Scotland and are responsible for forming our own views and opinions, we do work closely with Audit Scotland throughout the audit. This helps identify common priorities and risks, treat issues consistently across the sector, and improve audit quality and efficiency. We share information about identified risks, good practices and barriers to improvement so that lessons to be learnt and knowledge of what works can be disseminated to all relevant bodies. Internal Audit As part of our audit, we consider the scope and nature of internal audit work and look to minimise duplication of effort, to ensure the total audit resource to Clydeplan is used as efficiently and effectively as possible. Service organisations Renfrewshire Council (“the Council”) is the lead administrative authority for Clydeplan, providing Treasurer and Clydeplan Clerk roles, as well as other service support, such as payroll, ICT, legal and HR. Where those services (and associated systems) have a material impact on the annual accounts we will work with the Council to understand the controls in place over the systems used in delivering these services. Page 25 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 6 Delivering the audit – post pandemic Hybrid audit approach We intend to adopt a hybrid approach to our audit which combines on-site visits with remote working; learning from the better practices developed during the pandemic. All of our people have the equipment, technology and systems to allow them to work remotely or on-site, including secure access to all necessary data and information. All of our staff are fully contactable by email, phone call and video-conferencing. Meetings can be held over Skype, Microsoft Teams or by telephone. We employ greater use of technology to examine evidence, but only where we have assessed both the sufficiency and appropriateness of the audit evidence produced. Secure sharing of information We use a cloud-based file sharing service that enables users to easily and securely exchange documents and provides a single repository for audit evidence. Regular contact During the ‘fieldwork’ phases of our audit, we will arrange regular catch-ups with key personnel to discuss the progress of the audit. The frequency of these meetings will be discussed and agreed with management. Signing annual accounts Audit Scotland recommends the electronic signing of annual accounts and uses a system called DocuSign. Electronic signatures simplify the process of signing the accounts. Accounts can be signed using any device from any location and there is no longer a need for duplicate copies to be signed. Approach to audit of the annual accounts Our objective when performing an audit of the annual accounts is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement and to issue an auditor’s report that includes our auditor’s opinion. As part of our general approach, we will: • perform risk assessment procedures including updating our understanding of the entity and its environment, the financial reporting framework and system of internal control; • review the design and implementation of key internal controls; Page 26 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 7 • identify and assess the risks of material misstatement, whether due to fraud or error, at the financial statement level and the assertion level for classes of transaction, account balances or disclosures; • design and perform audit procedures responsive to those risks, to obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion; and • exercise professional judgment and maintain professional scepticism throughout the audit recognising that circumstances may exist that cause the financial statements to be materially misstated. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. We include an explanation in the auditor’s report of the extent to which the audit was capable of detecting irregularities, including fraud and respective responsibilities for prevention and detection of fraud. Key audit developments in 2022/23 Revised auditing standards1, which come into effect from the current year, will have a significant impact on the way we perform our audit, particularly how we assess the risk of material misstatement, our approach to the audit of fraud, and the ways we ensure our audits are performed in line with regulatory requirements and to a high standard. The in-depth nature of these additional procedures, as well as updated tools and techniques that may come into scope, will also offer additional opportunity to provide insights and constructive feedback on the way Clydeplan manages risks. Appendix 2 provides further details on the implications of these new requirements. Materiality We apply the concept of materiality both in planning and performing the audit, and in evaluating the effect of identified misstatements on the audit and of uncorrected misstatements. In general, misstatements, including omissions, are considered to be 1 Revisions to ISA (UK) 315 on auditors’ responsibility to identify and assess the risks of material misstatement in the financial statements and ISA (UK) 240 on material misstatements caused by fraud came into effect for audits of financial statements with periods commencing on or after 15 December 2021. Page 27 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 8 material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements. Judgments about materiality are made in the light of surrounding circumstances and are affected by our perception of the financial information needs of users of the financial statements, and by the size or nature of a misstatement, or a combination of both. The basis for our assessment of materiality is set out in Appendix 3. Accounting systems and internal controls The purpose of an audit is to express an opinion on the financial statements. As part of our work, we consider certain internal controls relevant to the preparation of the financial statements such that we are able to design appropriate audit procedures. However, this work is not for the purpose of expressing an opinion on the effectiveness of internal controls. We will report to the Joint Committee, significant deficiencies in internal controls that we identify during the audit. These matters will be limited to those which we conclude are of sufficient importance to merit being reported. The scope of our work is not designed to be an extensive review of all internal controls. Specialised skill or knowledge required to complete the audit procedures Our intended audit approach is to consult internally with our Technology Risk team for them to support the audit team in assessing the information technology general controls (ITGC). Going concern The concept of going concern applies in the public sector but in a different way to the private sector. In many public sector entities (but not all), the use of going concern basis of accounting is not a significant matter because the applicable financial reporting framework envisage that the going concern basis for accounting will apply where the entity's services will continue to be delivered by the public sector. In such cases, a material uncertainty related to going concern is unlikely to exist. For many public sector entities, the financial sustainability of the entity is more likely to be of significant public interest that the application of the going concern basis. Page 28 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 9 Prevention and detection of fraud or error In order to discharge our responsibilities regarding fraud and irregularity we require any fraud or irregularity issues to be reported to us as they arise. In particular we require to be notified of all frauds which: • Involve the misappropriation of theft of assets or cash which are facilitated by weaknesses in internal control • Are over £5,000 We also require a historic record of instances of fraud or irregularity to be maintained and a summary to be made available to us after each year end. Anti-money laundering The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 impose an obligation on the Auditor General to inform the National Crime Agency (NCA) if he knows or suspects that any person has engaged in money laundering or terrorist financing. Audit Scotland has extended this responsibility to the Accounts Commission in respect of local government. We require Clydeplan to notify us on a timely basis of any suspected instances of money laundering so that we can inform Audit Scotland who will determine the necessary course of action. Wider scope audit work The special accountabilities that attach to the conduct of public business, and the use of public money, mean that public sector audits must be planned and undertaken from a wider perspective than in the private sector. This means providing assurance, not only on the financial statements, but providing audit judgements and conclusions on the appropriateness, effectiveness and impact of corporate governance and performance management arrangements and financial sustainability. Appendix 1 provides detail of the wider scope areas of public sector audit work. The Code of Audit Practice provides for the Accounts Commission to specify an alternative audit approach where an audited body might be considered less complex due to its size and its limited financial activity. We have concluded, based on an assessment of the nature and circumstances of Clydeplan, that a limited wider scope audit is appropriate. Our audit will be limited to: • A review of the Annual Governance Statement Page 29 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 10 • Concluding on the financial sustainability of Clydeplan and the services it delivers over the medium to longer term. Best Value Appointed auditors have a duty to be satisfied that local government bodies have made proper arrangements to secure best value. Our work in respect of Clydeplan’s best value arrangements will be integrated into our audit approach, including our work on the wider scope areas as set out in this plan. We will review Clydeplan’s governance arrangements and consider how Clydeplan demonstrates and reports that it has Best Value arrangements in place to secure continuous improvement. Page 30 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 11 Significant and other risks of material misstatement Significant risks are risks that require special audit consideration and include identified risks of material misstatement that: • our risk assessment procedures have identified as being close to the upper range of the spectrum of inherent risk due to their nature and a combination of the likelihood and potential magnitude of misstatement; or • are required to be treated as significant risks due to requirements of ISAs (UK), for example in relation to management override of internal controls. Significant risks at the financial statement level The table below summarises significant risks of material misstatement identified at the financial statement level. These risks are considered to have a pervasive impact on the financial statements as a whole and potentially affect many assertions for classes of transaction, account balances and disclosures. Identified risk of material misstatement Audit approach Management override of controls Management is in a unique position to perpetrate fraud because of their ability to manipulate accounting records and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively. Although the level of risk of management override of controls will vary from entity to entity, the risk is nevertheless present in all entities. Due to the unpredictable way in which such override could occur, it is a risk of material misstatement due to fraud and thus a significant risk. Risk of material misstatement: Very High Procedures performed to mitigate risks of material misstatement in this area will include: • Documenting our understanding of the journals posting process and evaluating the design effectiveness of management controls over journals; • Analysing the journals listing and determining criteria for selecting high risk and / or unusual journals; • Testing high risk and / or unusual journals posted during the year and after the unaudited annual accounts stage back to supporting documentation for Page 31 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 12 Identified risk of material misstatement Audit approach appropriateness, corroboration and to ensure approval has been undertaken in line with Clydeplan’s journals policy; • Gaining an understanding of the accounting estimates and critical judgements made by management. We will challenge assumptions and consider the reasonableness and indicators of bias which could result in material misstatement due to fraud; and • Evaluating the rationale for any changes in accounting policies estimate or significant unusual transactions. Significant risks at the assertion level for classes of transaction, account balances and disclosures The table below summarises significant risks of material misstatement assertion level for classes of transaction, account balances and disclosures. Identified risk of material misstatement Audit approach Fraud in revenue recognition Material misstatement due to fraudulent financial reporting relating to revenue recognition is a presumed risk in ISA 240 (The Auditor's Responsibilities Relating to Fraud in an Audit of Financial Statements). The presumption is that Clydeplan could adopt accounting policies or recognise income in such a way as Procedures performed to mitigate risks of material misstatement in this area will include: • Evaluation the significant income streams and review the controls in place over accounting for revenue. • Consideration of Clydeplan’s key areas of income and obtaining evidence that income is recorded in line with appropriate accounting Page 32 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 13 Identified risk of material misstatement Audit approach to lead to a material misstatement in the reported financial position. Given the financial pressures facing the public sector as a whole, there is an inherent fraud risk associated with the recording of income around the year end. However, we do not deem this risk to be present in requisitions received from the constituent local authorities due to a lack of incentive and opportunity to manipulate transactions. Revenue (occurrence / completeness): High policies and the policies have been applied consistently across the year. Fraud in non-pay expenditure As most public sector bodies are net expenditure bodies, the risk of fraud is more likely to occur in expenditure. There is a risk that expenditure may be misstated resulting in a material misstatement in the financial statements. Given the financial pressures facing the public sector as a whole, there is an inherent fraud risk associated with the recording of expenditure around the year end. Inherent risk of material misstatement: • Non-pay expenditure (occurrence / completeness): High • Accruals (existence / completeness): High Procedures performed to mitigate risks of material misstatement in this area will include: • Evaluating the significant non-pay expenditure streams and reviewing the controls in place over accounting for expenditure. • Consideration of Clydeplan’s key areas of expenditure and obtaining evidence that expenditure is recorded in line with appropriate accounting policies and the policies have been applied consistently across the year. • Review of accruals around the year end to consider if there is any indication of understatement of balances held through consideration of accounting estimates. Page 33 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 14 Identified risk of material misstatement Audit approach Pension asset / liability (key accounting estimate) An actuarial estimate of the pension fund asset/liability is calculated on an annual basis under IAS 19 and on a triennial funding basis by an independent firm of actuaries with specialist knowledge and experience. The estimates are based on the most up to date membership data held by the pension fund and have regard to local factors such as mortality rates and expected pay rises with other assumptions around inflation when calculating the liabilities. A significant level of estimation is required in order to determine the valuation of pension assets/liabilities. Small changes in the key assumptions (including discount rates, inflation, and mortality rates) can have a material impact on the pension asset/liability. There is a risk that the assumptions used are not appropriate. Inherent risk of material misstatement: Pensions (valuation): High Procedures performed to mitigate risks of material misstatement in this area will include: • Review of the controls in place to ensure that the data provided from the pension fund to the actuary is complete and accurate. • Reviewing the reasonableness of the assumptions used in the calculation against other local government pension fund actuaries and other observable data. • Agreeing the disclosures in the financial statements to information provided by the actuary. • Considering the competence, capability and objectiveness of the management expert in line with ISA (UK) 500 Audit Evidence. Page 34 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 15 Wider scope As described previously, the Code of Audit Practice frames a significant part of our audit responsibilities. Following consideration of the size, nature and risks of Clydeplan, the application of the full wider scope audit is judged by us not to be appropriate. Our annual audit work will therefore be restricted to: • A review of the Annual Governance Statement • Concluding on the financial sustainability of Clydeplan and the services it delivers over the medium to longer term. Our planned audit work against these two areas is risk based and proportionate. Our initial assessment builds upon our understanding of Clydeplan’s key priorities and risks, along with discussions with management and review of Clydeplan minutes and key strategy documents. At this stage of our audit planning process, we have identified one significant risk to the wider scope of our audit as set out in the table below. Audit planning however is a continuous process. We will report any other identified significant risks in our annual audit report. Financial sustainability Audit approach In December 2022 Clydeplan considered its revenue budget for 2023/24 and indicative budget estimates for the subsequent two years (to 2025/26). At the end of the current financial year Clydeplan is estimating to have a revenue reserve of £421k which represents circa 76% of operating income or over 50% of expenditure. The key cost driver is staff expenditure which is expected to increase over the period of the estimate by 3% each year. Due to a high level of uncommitted reserves the net requisitions for 2023/24 will be reviewed. Clydeplan’s approach is to have reserves of a minimum of 10% of its expenditure which currently equates to £56k. We will review Clydeplan’s arrangements for managing its financial position. Our work will include an assessment of progress made in developing financially sustainable plans which support the delivery of Clydeplan’s statutory functions and strategic objectives. Page 35 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 16 Financial sustainability Audit approach There is a level uncertainty in the above estimates due to: • Indirect dependence on the Scottish Government annual allocation of funding to local authorities who in turn fund Clydeplan activities through their requisitions. The funding levels from the Scottish Government beyond 2023/24 are uncertain and impacted by wider economic factors in Scotland. • Clydeplan faces cost pressures, particularly in its staff cost which make up 87% of its expenditure. While the most recent Bank of England’s expectation is that the inflation will fall to 4% at the calendar year end the current levels are still high and around 10%. There is also uncertainty around the impact of the Planning (Scotland) Act and succession planning due to the retirements of key staff expected at the end of 2022/23. Clydeplan medium to longer term financial planning is therefore subject to above uncertainties, with use of reserves likely to cover for the budgeted and estimated deficits. We note that if the reserves are used for such purposes the level of reserves at the end of 2025/26 remains significantly above the minimum 10% preferred level. However, further use of reserves should be considered with a long term view on Clydeplan’s financial sustainability. Page 36 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 17 Your Azets audit management team The external audit team will be led by Gary Devlin and managed by Adrian Kolodziej. Gary Devlin: Engagement Lead gary.devlin@azets.co.uk Gary is the partner in charge of our audit of Glasgow and the Clyde Valley Strategic Development Planning Authority. Gary has over 20 years’ experience in local government auditing and also leads our external audit appointment to Renfrewshire Council. Adrian Kolodziej: Engagement Manager adrian.kolodziej@azets.co.uk Adrian will manage the delivery of the onsite work and work alongside Gary to deliver the audit engagement. Adrian has over 14 years of public sector experience performing the external audits of local authorities, central government and further education bodies. Page 37 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 18 Audit timetable The submission date for audited annual accounts in local government is generally set to be consistent with the date specified in the accounts regulations by which Clydeplan is required to approve its audited accounts. The Coronavirus (Scotland) Act 2000 permitted a deferral in 2019/20 and 2020/21 to 30 November, and a temporary amendment to the accounts regulations allowed a submission date of 31 November for 2021/22. However, the submission date is returning to pre-pandemic 30 September for 2022/23. We have set out below target months which align to the schedule of the Joint Committee meetings. We aim to meet these scheduled meetings however this will be monitored during the audit process and may require to be revised to reflect emerging issues. Audit work/ output Description Target month/s Clydeplan Deadline Audit plan Audit plan setting out the scope of our audit, including key audit matters, presented to Clydeplan. February 13 March 2023 31 March 2023 Interim audit Interim audit including review of accounting systems. March - April N/A N/A Final audit Accounts presented for audit and final audit visit begins July - September TBC 30 September 2023 Independent Auditor’s Report This report will contain our opinion on the financial statements, the audited part of the remuneration report, annual governance statement and September 11 September 2023 30 September 2023 Page 38 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 19 Audit work/ output Description Target month/s Clydeplan Deadline management commentary. Annual Report to the Joint Committee and the Controller of Audit At the conclusion of each year's audit we issue an annual report setting out the nature and extent of our audit work for the year and summarise our opinions, conclusions and the significant issues arising from our work. This report pulls together all of our work under the Code of Audit Practice. September 11 September 2023 30 September 2023 Prior to submitting our outputs, we will discuss all issues with management to confirm factual accuracy and agree a draft action plan where appropriate. The action plans within the reports will include prioritised recommendations, responsible officers and implementation dates. We will review progress against the action plans on a regular basis. Page 39 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 20 Audit fee For 2022/23, the new appointment process provided Audit Scotland with a fair representation of the current audit market for each individual body with the outcome of this exercise highlighting the increasing requirements, expectations and scrutiny of the audit profession. The quality of audit work is an essential requirement in successfully delivering a fully compliant ISA and Code of Audit Practice audit. These factors have led to above inflationary increases in the cost of audit. Whilst these increases are significant these are consistent with evidence obtained from the profession and other UK audit agencies. On setting fees, Audit Scotland has ensured that efficiencies have been fully utilised to mitigate the impact. For the local government sector, the average fee increase is 12.5%. Audit Scotland sets an expected audit fee that assumes the body has sound governance arrangements in place, has been operating effectively throughout the year, prepares comprehensive and accurate draft accounts and meets the agreed timetable for audit. The expected fee is reviewed by Audit Scotland each year and adjusted if necessary based on auditors’ experience, new requirements, or significant changes to the audited body. As auditors we negotiate a fee with Clydeplan during the planning process. The fee may be varied above the expected fee level to reflect the circumstances and local risks within the body. For 2022/23, we propose setting the audit fee at £5,780 which is c.13% above the base fee level. This reflects the level of work we consider is required in response to the key audit matters identified in this document. Page 40 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 21 2022/23 2021/22 Auditor remuneration £19,800 (base is 17,530) 2,700 Pooled costs - 280 Audit support costs £660 140 Sectoral cap adjustment (£14,680) - Total fee £5,780 £3,120 We will take account of the risk exposure of Clydeplan and the management assurances in place. We assume receipt of the draft working papers at the outset of our on-site final audit visit. If the draft accounts and papers are late, or agreed management assurances are unavailable, we reserve the right to charge an additional fee for additional audit work. An additional fee will be required in relation to any other significant exercises not within our planned audit activity. Page 41 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 22 Audit independence and objectivity International Standard on Auditing (UK) 260 "Communication with those charged with governance" requires us to communicate on a timely basis all facts and matters that may have a bearing on our independence. In particular, FRC’s Ethical Standard stipulates that where an auditor undertakes non audit work, appropriate safeguards must be applied to reduce or eliminate any threats to independence. Azets has not been appointed by Clydeplan to provide any non-audit services during the year. We confirm that we comply with FRC’s Ethical Standard. In our professional judgement, the audit process is independent and our objectivity has not been compromised in any way. In particular there are and have been no relationships between Azets and Clydeplan, its Clydeplan members and senior management that may reasonably be thought to bear on our objectivity and independence. Page 42 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 23 Appendix 1: Responsibilities of the Auditor and Clydeplan The Accounts Commission, Controller of Audit and Audit Scotland The Accounts Commission is an independent public body. Its members are appointed by Scottish Ministers and are responsible for holding local government to account. Under statute, the Accounts Commission appoints a Controller of Audit to consider the results of the audit of accounts, including the wider-scope responsibilities and Best Value auditing. The Controller of Audit makes reports to the Accounts Commission on matters arising from the accounts and on Best Value and acts independently of the Accounts Commission when reporting to it. Audit Scotland is an independent statutory body that co-ordinates and supports the delivery of high-quality public sector audit in Scotland. Audit Scotland oversees the appointment and performance of auditors, provides technical support, delivers performance audit and Best Value work programmes and undertakes financial audits of public bodies. Auditor responsibilities Code of Audit Practice The Code of Audit Practice (the Code) describes the high-level, principles-based purpose and scope of public audit in Scotland. The 2021 Code came into effect from 2022/23. The Code of Audit Practice outlines the responsibilities of external auditors appointed by the Accounts Commission and it is a condition of our appointment that we follow it. Our responsibilities Auditor responsibilities are derived from the Code, statute, International Standards on Auditing (UK) and the Ethical Standard for auditors, other professional requirements and best practice, and guidance from Audit Scotland. We are responsible for the audit of the accounts and the wider-scope responsibilities explained below. We act independently in carrying out our role and in exercising professional judgement. We report to the Joint Committee and others, including Audit Scotland, on the results of our audit work. Page 43 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 24 Weaknesses or risks, including fraud and other irregularities, identified by auditors, are only those which come to our attention during our normal audit work in accordance with the Code and may not be all that exist. Wider scope audit work Reflecting the fact that public money is involved, public audit is planned and undertaken from a wider perspective than in the private sector. The wider scope audit specified by the Code broadens the audit of the accounts to include additional aspects or risks in areas of financial management; financial sustainability; vision, leadership and governance; and use of resources to improve outcomes. Financial management Financial management means having sound budgetary processes. Audited bodies require to understand the financial environment and whether their internal controls are operating effectively. Auditor considerations Auditors consider whether the body has effective arrangements to secure sound financial management. This includes the strength of the financial management culture, accountability, and arrangements to prevent and detect fraud, error and other irregularities. Financial sustainability Financial sustainability means being able to meet the needs of the present without compromising the ability of future generations to meet their own needs. Auditor considerations Auditors consider the extent to which audited bodies show regard to financial sustainability. They look ahead to the medium term (two to five years) and longer term (over five years) to consider whether the body is planning effectively so it can continue to deliver services. Page 44 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 25 Vision, leadership and governance Audited bodies must have a clear vision and strategy, and set priorities for improvement within this vision and strategy. They work together with partners and communities to improve outcomes and foster a culture of innovation. Auditor considerations Auditors consider the clarity of plans to implement the vision, strategy and priorities adopted by the leaders of the audited body. Auditors also consider the effectiveness of governance arrangements for delivery, including openness and transparency of decision-making; robustness of scrutiny and shared working arrangements; and reporting of decisions and outcomes, and financial and performance information. Use of resources to improve outcomes Audited bodies need to make best use of their resources to meet stated outcomes and improvement objectives, through effective planning and working with strategic partners and communities. This includes demonstrating economy, efficiency and effectiveness through the use of financial and other resources, and reporting performance against outcomes. Auditor considerations Auditors consider the clarity of arrangements in place to ensure that resources are deployed to improve strategic outcomes, meet the needs of service users taking account of inequalities, and deliver continuous improvement in priority services. Limited wider scope audit work The Code of Audit Practice provides for the Accounts Commission to specify an alternative audit approach where an audited body might be considered less complex due to its size and its limited financial activity. We have concluded, based on an assessment of the nature and circumstances of Clydeplan, that a limited wider scope audit is appropriate. Our audit will be limited to: • A review of the Annual Governance Statement Page 45 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 26 • Concluding on the financial sustainability of Clydeplan and the services it delivers over the medium to longer term. Best Value Appointed auditors have a duty to be satisfied that local government bodies have made proper arrangements to secure best value. Our work in respect of Clydeplan’s best value arrangements will be integrated into our audit approach, including our work on the wider scope areas as set out in this plan. We will review Clydeplan’s governance arrangements and consider how Clydeplan demonstrates and reports that it has Best Value arrangements in place to secure continuous improvement. Audit quality The Auditor General and the Accounts Commission require assurance on the quality of public audit in Scotland through comprehensive audit quality arrangements that apply to all audit work and providers. The audit quality arrangements recognise the importance of audit quality to the Auditor General and the Accounts Commission and provide regular reporting on audit quality and performance. Audit Scotland maintains and delivers an Audit Quality Framework. The most recent audit quality report can be found at https://www.audit- scotland.gov.uk/publications/quality-of-public-audit-in-scotland-annual-report-202122 Page 46 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 27 Clydeplan responsibilities Clydeplan has primary responsibility for ensuring the proper financial stewardship of public funds, compliance with relevant legislation and establishing effective arrangements for governance, propriety and regularity that enables it to successfully deliver its objectives. The features of proper financial stewardship include the following: Area Clydeplan responsibilities Corporate governance Clydeplan is responsible for establishing arrangements to ensure the proper conduct of its affairs including the legality of activities and transactions, and for monitoring the adequacy and effectiveness of these arrangements. Those charged with governance should be involved in monitoring these arrangements. Financial statements and related reports Clydeplan has responsibility for: • preparing financial statements which give a true and fair view of its financial position and its expenditure and income, in accordance with the applicable financial reporting framework and relevant legislation; • maintaining accounting records and working papers that have been prepared to an acceptable professional standard and that support its financial statements and related reports disclosures; • ensuring the regularity of transactions, by putting in place systems of internal control to ensure that they are in accordance with the appropriate authority; and • preparing and publishing, along with the financial statements, an annual governance statement, management commentary (or equivalent) and a remuneration report in accordance with prescribed requirements. Management commentaries should be fair, balanced and understandable. Management is responsible, with the oversight of those charged with governance, for communicating relevant information to users about the entity and its financial performance, including providing adequate disclosures in accordance with the applicable financial reporting framework. The relevant information should be communicated clearly and concisely. Page 47 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 28 Area Clydeplan responsibilities Clydeplan is responsible for developing and implementing effective systems of internal control as well as financial, operational and compliance controls. These systems should support the achievement of its objectives and safeguard and secure value for money from the public funds at its disposal. Clydeplan is also responsible for establishing effective and appropriate internal audit and risk-management functions. Standards of conduct for prevention and detection of fraud and error Clydeplan is responsible for establishing arrangements to prevent and detect fraud, error and irregularities, bribery and corruption and also to ensure that its affairs are managed in accordance with proper standards of conduct by putting proper arrangements in place. Financial position Clydeplan is responsible for putting in place proper arrangements to ensure the financial position is soundly based having regard to: • Such financial monitoring and reporting arrangements as may be specified; • Compliance with statutory financial requirements and achievement of financial targets; • Balances and reserves, including strategies about levels and their future use; • Plans to deal with uncertainty in the medium and long term; and • The impact of planned future policies and foreseeable developments on the financial position. Best value Clydeplan has a specific responsibility to make arrangements to secure Best Value. Best Value is defined as continuous improvement in the performance of the body’s functions. In securing Best Value, the local government body is required to maintain an appropriate balance among: • The quality of its performance of its functions Page 48 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 29 Area Clydeplan responsibilities • The cost to the body of that performance • The cost to persons of any service provided by it for them on a wholly or partly rechargeable basis. In maintaining that balance, Clydeplan shall have regard to: • Efficiency • Effectiveness • Economy • The need to meet the equal opportunity requirements. Clydeplan should discharge its duties in a way which contributes to the achievement of sustainable development. Page 49 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 30 Appendix 2: Potential impact on Clydeplan and our audit approach following revisions to auditing standards Revised auditing standards which come into effect from the current year, will have a significant impact on the way we perform our audit, particularly how we assess the risk of material misstatement, our approach to the audit of fraud, and the ways we ensure our audits are performed in line with regulatory requirements and to a high standard. The table below provides further detail on the implications of these new requirements. Key change Potential impact on Clydeplan & our approach Enhanced risk identification and assessment, promoting more focused auditor responses to identified risks Management and those charged with governance may receive more up-front questions as we plan the audit and identify and assess risks of material misstatement. We may conduct planning and risk assessment procedures at a different time to ensure that our understanding is comprehensive, and that information is leveraged effectively and efficiently. To facilitate a more robust risk-assessment, we may request additional information to enhance our understanding of systems, processes and controls. For example, we may request: • a better understanding of Clydeplan’s structure and operations and how it integrates information technology (IT) • more information about Clydeplan’s processes for assessing risk and monitoring its system of internal control Page 50 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 31 Key change Potential impact on Clydeplan & our approach • more detailed narratives about how transactions are initiated, recorded, processed and reported • policies and procedure manuals, flowcharts and other supporting documentation to validate our understanding of the information systems relevant to the preparation of the financial statements • more information to support our inherent risk assessment. This information not only informs our risk assessment but also assists us in determining an appropriate response to risks identified, including any new significant risks which require a different response. Understanding and acting on risks associated with IT We will be asking tailored questions and making information requests to understand the IT environment, including: • IT applications • supporting IT infrastructure • IT processes • personnel involved in the IT processes. Combined with the controls that may be needed to address the identified and assessed risks of material misstatement, this understanding may also identify existing and new risks arising from the use of IT. Therefore, we will be asking more focused questions and requesting additional information to understand the general IT controls that address such risks. For example, we may have questions in relation to general IT controls over journal entries (e.g., segregation of duties related to preparing and posting entries) to address risks arising from the use of IT. Depending on our assessment of the complexity of systems and associated risks, we may also involve additional team members, such as IT specialists. Enhanced procedures in connection with fraud We will be asking targeted questions as part of an enhanced approach to fraud, including discussing with Clydeplan: • any allegations of fraud raised by employees or related parties Page 51 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 32 Key change Potential impact on Clydeplan & our approach • the risks of material fraud, including those specific to the local government sector. Combined with other information, and any inconsistencies in responses from those charged with governance and management, we determine implications for further audit procedures. Work in connection with fraud may also now include the use of audit data analytics, or the inclusion of specialists in our engagement team to ensure we obtain sufficient appropriate audit evidence to conclude whether the financial statements are materially misstated as a result of fraud. In addition to existing communication and reporting requirements relating to irregularities and fraud, there may be further matters we report in connection with management’s process for identifying and responding to the risks of fraud in the entity and our assessment of the risks of material misstatement due to fraud. These enhanced requirements may assist in the prevention and detection of material fraud, though do not provide absolute assurance that all fraud is detected or alter the fact that the primary responsibility for preventing and detecting fraud rests with Clydeplan and management. Enhanced requirements for exercising professional scepticism Challenge, scepticism and the application of appropriate professional judgement are key components of our audit approach. You may receive additional inquiries if information is found that contradicts what our team has already learned in the audit or in instances where records or documents seen in the course of the audit appear to have been tampered with, or to not be authentic. Using the right resources, in the right way, at the right time One of our new strategic quality objectives sets out that we will strive to use the right resource, in the right way, at the right time. This may mean increasing the use of specialists (for example in relation to general IT controls) or changing the shape of the audit engagement team to ensure that we are able to provide appropriate challenge and feedback in specialist areas. This will include appropriate use of technology, including data analytics. Page 52 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 33 Appendix 3: Materiality Materiality is an expression of the relative significance of a matter in the context of the financial statements as a whole. A matter is material if its omission or misstatement would reasonably influence the decisions of an addressee of the auditor’s report. The assessment of what is material is a matter of professional judgement and is affected by our assessment of the risk profile of the organisation and the needs of users. We review our assessment of materiality throughout the audit. Whilst our audit procedures are designed to identify misstatements which are material to our audit opinion, we also report to the Joint Committee and management any uncorrected misstatements of lower value errors to the extent that our audit identifies these. Materiality Overall materiality Performance materiality (75%) Trivial threshold (5%) Materiality Our assessment is made with reference to Clydeplan’s gross expenditure. We consider this to be the principal consideration for the users of the annual accounts when assessing financial performance. Our assessment of materiality equates to approximately 2% of Clydeplan’s gross expenditure as estimated in the most recent revenue monitoring report. In performing our audit, we apply a lower level of materiality to the audit of the Remuneration Report. Our materiality is set at £5,000. £13,000 Accounts materially misstated where total errors exceed this value £9,750 Work performed to capture individual errors at this level £650 All errors greater than this level are reported Page 53 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority: External Audit Plan 2022/23 34 Performance materiality Performance materiality is the working level of materiality used throughout the audit. We use performance materiality to determine the nature, timing and extent of audit procedures carried out. We perform audit procedures on all transactions, or groups of transactions, and balances that exceed our performance materiality. This means that we perform a greater level of testing on the areas deemed to be at significant risk of material misstatement. Performance materiality is set at a value less than overall materiality for the financial statements as a whole to reduce to an appropriately low level the probability that the aggregate of the uncorrected and undetected misstatements exceed overall materiality. Trivial misstatements Trivial misstatements are matters that are clearly inconsequential, whether taken individually or in aggregate and whether judged by any quantitative or qualitative criteria. Page 54 of 72
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We are an accounting, tax, audit, advisory and business services group that delivers a personal experience both digitally and at your door. Accounting | Tax | Audit | Advisory | Technology © Azets 2023. All rights reserved. Azets refers to Azets Audit Services Limited. Registered in England & Wales Registered No. 09652677. VAT Registration No. 219 0608 22. Registered to carry on audit work in the UK and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. Page 55 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority To: Glasgow and the Clyde Valley Strategic Development Planning Authority Joint Committee On: 13th March 2023 Report by Stuart Tait, Manager Annual Report 2022 1. Summary 1.1 The purpose of this report is for the Joint Committee to consider and approve for publication its Annual Report for 2022. 2. Recommendations 2.1 It is recommended that the Joint Committee • approve the 2022 Annual Report as set out in the Appendix; and, • agree that, in accordance with the practice of previous years, an enhanced version of the Annual Report be produced in order to promote the work of the Joint Committee. 3. Context 3.1 Clydeplan’s Minute of Agreement requires the preparation of an Annual Report to set out the work of the Authority for the previous calendar year. 3.2 The Appendix sets out the 2022 Annual Report and provides a summary of the work undertaken by Clydeplan during the year under the following broad headings: • Clydeplan Joint Committee; • Glasgow City Region; • Planning (Scotland) Act - Regional Spatial Strategies and National Planning Framework 4; • Glasgow City Region Green Network Partnership; • Annual Accounts and Audit Report; and, • Priorities and Issues affecting the future work of Clydeplan. Item 5 Page 57 of 72
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Appendix CLYDEPLAN ANNUAL REPORT 2022 Introduction The eight Clydeplan Local Authorities are committed to strategic planning and working in partnership with a wide range of stakeholders in support of the delivery of its Vision and Spatial Development Strategy as set out in the Clydeplan Strategic Development Plan for the Glasgow City Region which was approved by Scottish Ministers on 24th July 2017. The Clydeplan Strategic Development Plan provides a sound foundation upon which the city region can deliver growth for Scotland’s largest city region and a context for its Local Authority Local Development Plans, Local Housing Strategies and Development Management decisions as well as supporting the Glasgow City Region’s Economic Strategy. The scale of work that has been undertaken by Clydeplan during 2022 has only been made possible by the willing support that it has gratefully received from both private and public sector partners. The Annual Report sets out the work that has been undertaken by Clydeplan along with its partners during 2022. Further information on the work of Clydeplan can be found at www.clydeplan- sdpa.gov.uk. Clydeplan Joint Committee The Clydeplan Joint Committee met five times during 2022 in March, June, September and December with a Special Meeting in October to consider the Annual Audited Accounts. Details of the meeting’s agendas, papers and minutes can be found at https://bit.ly/2TAaTZo. During 2022, the Joint Committee published its Annual Report 2021 and its Development Plan Scheme and Participation Statement 2022/2023. In December 2022 the Joint Committee approved its revenue budget for the period 2023/24. Page 59 of 72
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Glasgow City Region During 2022 Clydeplan continued its support for the various work streams of the various Glasgow City Region thematic portfolios including Land Use and Sustainability, Infrastructure and Assets, Housing and Equalities, Transport and Connectivity based portfolios and both the Economic Delivery Group and the Intelligence Hub. Clydeplan’s involvement with the Glasgow City Region activities is likely to continue to grow and develop during 2023 particularly given the economies of scale and general benefits that can be gained through city region scale joint partnership working. This regional joint working approach also supports the Planning (Scotland) Act which seeks for local authorities, working together, as groupings to support the delivery of National Planning Framework 4 through the development of Regional Spatial Strategies. Further information on the work of the Glasgow City Region can be found at https://glasgowcityregion.co.uk/. Planning (Scotland) Act 2019 - Regional Spatial Strategies and National Planning Framework 4 (NPF4) The Planning (Scotland) Act which was enacted on 25th July 2019 removes the statutory requirement to prepare a Strategic Development Plan and replaces it with a duty for planning authorities to work together to prepare and adopt a ‘Regional Spatial Strategy’. The eight Clydeplan Local Authorities have agreed to continue to work together to prepare a future Regional Spatial Strategy for the Glasgow City Region. It is anticipated that the formal duty to prepare a Regional Spatial Strategy will come into effect once NPF4 is adopted in early 2023. NPF4 It is anticipated that NPF4, which for the first time will form part of the statutory Development Plan along with the Local Development Plan, will be approved in January 2023 and adopted in February 2023. https://www.transformingplanning.scot/national-planning-framework/ NPF4 seeks to address the climate emergency and the need to reduce greenhouse gas emissions and adapt to the future impacts of climate and also the nature crisis. and to work together to enable development that addresses the social and economic legacy of the coronavirus pandemic, the cost crisis and longstanding inequality. To achieve this NPF4 sets out a National Spatial Strategy for Scotland to 2045 which seeks to deliver sustainable places, liveable places, and productive places and sets out six spatial principles just transition; conserving and recycling assets; local living; compact urban growth; rebalanced development; and, rural revitalisation. Page 60 of 72
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NPF4 will also set out the regional spatial priorities for Scotland along with 18 National Developments which will support the National Spatial Strategy. In the context of the Glasgow City Region this is included as part of what is described as ‘Central’ aimed at transforming and pioneering a new era of low carbon urban living with a focus on regeneration. The key National Developments for the Glasgow City Region are the ‘Metropolitan Glasgow Strategic Drainage Partnership’; ‘Clyde Metro’; Central Scotland Green Network (incorporating the Glasgow City Region Green Network); Clyde Mission; and, High Speed Rail. The National Spatial Strategy will guide the preparation of Regional Spatial Strategies, Local Development Plans and Local Place Plans as well as being relevant to wider policies and strategies relating to land use. NPF4 also sets out National Planning Policy which consists of 33 policies which set out the policies for the development and use of land which are to be applied in the preparation of local development plans; local place plans; masterplans and briefs; and for determining planning consents. Regional Spatial Strategies The Scottish Government have stated that the new Regional Spatial Strategies will identify areas for future population growth, align with regional economic strategies and identify key sectors and clusters for future development and investment. Regional Spatial Strategies should also set out a clear place-based spatial strategy that guides future development across different areas of Scotland. This will include identification of networks of regionally significant centres, growth and investment areas and ensuring that future development and infrastructure works with each area’s assets and whilst conserving and enhancing nationally and regionally recognised natural and historic areas and assets. The Scottish Government have stated that Regional Spatial Strategy guidance will be published late 2023/early 2024. Glasgow City Region Green Network Since the establishment of the Glasgow City Region Green Network Partnership in 2007, the first partnership of its type in Scotland, green networks and related thinking has developed significantly much of which has been at the instigation of the work of the Green Network team including • the Central Scotland Green Network established as a National Development in NPF4 and proposed to continue as a National Development in NPF4, • the development of the Glasgow City Region Green Network ‘Blueprint’ and the • the development of Green Infrastructure policy advice. Page 61 of 72
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The role for green networks have also been identified as an important component of the city region’s green recovery and in respect of tackling the twin climate and ecological emergencies. In this context the Strategic Habitat Network plays an important role. Progress towards each of the key habitat network strands during 2021 is set out below: Peatland - The role of peatland restoration in contributing to the drive for Net Zero, and to flood mitigation, is well recognised. It is also a UK and Scottish priority habitat and therefore the case is strong for targeting effort and resources at the significant areas of peatland within the Glasgow and Clyde Valley. The Green Network launched the Clyde Peatlands initiative at the Glasgow City Region Cabinet in June to coincide with the recruitment of 2 new Peatland Officers funded through the Scottish Government’s Peatland ACTION Fund, administered by NatureScot. The post will be hosted by Clydeplan/Green Network initially to April 2025 thanks to Clydeplan underwriting an additional year to the contract as agreed by the Joint Committee in September. It is anticipated NatureScot will extend the post for a further year when the next round of Scottish Government funding is secured. The post will be advertised in the next two weeks. The Clyde Peatlands launch generated a great deal of interest and requests for assistance. In the interim a substantial portfolio of potential project work has been collated which will allow the new officer to hit the ground running. Grassland and Wetland - The new Green Network Development Officer, funded for two years through Clydeplan reserves as agreed by the Joint Committee, joined the team in April with the specific remit of driving forward the grassland and wetland elements of the Blueprint. Both of these habitat types have far less dedicated funding than woodland and peatland and are therefore more difficult to progress. However, we currently await the decision on a Scottish Government Nature Restoration Fund application for developing a regional grassland network. If successful, this will give us the tools we need for public and private sector engagement and to make the case for substantial delivery funding. The Development Officer has also been working with East Dunbartonshire Council on a pilot wetland project in the Kelvin Valley, spanning into neighbouring North Lanarkshire and Glasgow. The project will seek to maximise the biodiversity, flood management and visitor benefits of a strategic wetland network, and the work has just been awarded £50,000 from the Shared Prosperity Fund. We hope to use this as a pilot that can be learned from and replicated elsewhere in the City Region. There is a strong correlation between the work described above and the development of Nature Networks as required by NPF. The SEP workshop gave a strong steer that some of the new Development Officer’s time should be directed to supporting this workstream at the appropriate time. Page 62 of 72
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Woodland - the woodland element of the Blueprint is being driven forward by the Clyde Climate Forest (CCF). After a difficult period with loss of staff, CCF is now making significant progress on each of its 3 strands of work: (i) urban tree canopy cover, (ii) rural planting for climate change and (iii) woodland habitat connectivity. In addition to its core staff the CCF is now supported by seconded officers from the Green Action Trust and Trees for Cities. CCF continues to report to the Green Network on progress towards Blueprint delivery through SEP. Further information on the work of the Glasgow City Region Green Network Partnership can be found at https://www.gcvgreennetwork.gov.uk/. Annual Accounts and Audit Report The Joint Committee’s Annual Audited Accounts and Audit Report for the period to 31st March 2022 were approved on 24th October 2022. Both documents are published on the Clydeplan’s website. Priorities and Issues affecting the future work of Clydeplan The priorities for the future work of Clydeplan will be influenced, amongst other things, by the Planning (Scotland) Act 2019 and the requirements in relation to strategic planning and the National Planning Framework 4; ongoing developments around Glasgow City Region in terms of governance, subject based portfolios, City Deal and support for the delivery of the Glasgow City Region Economic Strategy and Action Plan; development of a work programme to support the development of the Regional Spatial Strategy; and, continuing challenges of delivery in the context of reduced financial and local authority planning staff resources. Page 63 of 72
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Glasgow and the Clyde Valley Strategic Development Planning Authority To: Glasgow and the Clyde Valley Strategic Development Planning Authority Joint Committee On: 13th March 2023 Report by Stuart Tait, Manager Planning (Scotland) Act 2019 - Adoption of National Planning Framework 4 1. Summary 1.1 The purpose of this report is for the Joint Committee to note the adoption and publication of National Planning Framework 4 (NPF4) and the new duties arising from the Planning (Scotland) Act 2019 in relation to regional planning. 2. Recommendations 2.1 It is recommended that the Joint Committee note • the adoption and publication of NPF4 by Scottish Ministers; • that as consequence the current Clydeplan Strategic Development Plan (July 2017) ceases to have effect and as such will no longer be part statutory Development Plan; and, • that a further report will be brought to a future meeting of the Joint Committee in terms of the implications for the Committee’s future work programme and governance. 3. Context 3.1 Clydeplan’s current remit in terms of its Minute of Agreement (June 2013) is “to prepare, monitor and keep under review the Glasgow and the Clyde Valley Strategic Development Plan (referred to herein as “the Strategic Development Plan”) for the Strategic Development Plan area on behalf of the Member Councils”. 3.2 As a consequence of the adoption and publication of NPF4 on 13th February 2023 and Chief Planner letter dated 8th February 2023 which states that the “Strategic Development Plans (SDP) and associated supplementary guidance will cease to have effect and as such no longer be part of the development plan”. The Chief Planners letter is set out in the Appendix. 3.3 The Planning (Scotland) Act 2019 states “A planning authority, or two or more such authorities acting jointly, are to prepare and adopt a Regional Spatial Strategy.” 3.4 The Scottish Government have indicated that they expect work on Regional Strategies to commence once they publish guidance which is anticipated in late 2023/early2024. Item 6 Page 65 of 72
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3.5 In terms of process the Planning Authority must adopt a RSS as soon as reasonably practicable after section 5 of the Planning (Scotland) Act 2019 comes into force which is still to be formally enacted; must keep their adopted RSS under review, and if they consider it appropriate, may at any time prepare and adopt a replacement strategy; must review their adopted RSS at least once in every period of 10 years. 3.6 In light of the above a future report will be brought to a future meeting of the Joint Committee in terms of the implications for the Committee’s future work programme and governance. Page 66 of 72
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Victoria Quay, Edinburgh EH6 6QQ www.gov.scot Local Government and Housing Directorate Planning, Architecture and Regeneration Division T: 0131-244 7547 E: chief.planner@gov.scot ___ 8 February 2023 Dear Colleague Transitional Arrangements for National Planning Framework 4 Following the approval by the Scottish Parliament of National Planning Framework 4 (NPF4) on 11 January 2023, the following provides advice on NPF4 becoming part of the statutory ‘development plan’ alongside local development plans (LDPs). We intend for this advice to support consistency in decision making ahead of new style LDPs being in place. The Development Plan In Scotland, the planning system is plan-led. From 13 February, on adoption and publication by Scottish Ministers, NPF4 will form part of the statutory development plan, along with the LDP applicable to the area at that time and its supplementary guidance. NPF4 will supersede National Planning Framework 3 and Scottish Planning Policy (SPP) (2014). NPF3 and SPP will no longer represent Scottish Ministers’ planning policy and should not therefore form the basis for, or be a consideration to be taken into account, when determining planning applications on or after 13 February. On 13 February, Strategic Development Plans (SDP) and associated supplementary guidance will cease to have effect and as such no longer be part of the development plan. LDPs already adopted will continue to be part of the development plan. For avoidance of doubt, existing LDP land allocations will be maintained. LDPs within SDP areas will no longer be required to be consistent with the SDP. For proposed LDPs prepared prior to the adoption and publication of NPF4, it may be that there are opportunities to reconcile identified inconsistencies with NPF4 through the examination process. However there are clear limitations to this. The scope of an examination is limited to issues raised in representations and the process must remain proportionate and fair. Whether an LDP has been adopted prior to or after the adoption and publication of NPF4, legislation states that in the event of any incompatibility between a provision of NPF and a Page 67 of 72
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Victoria Quay, Edinburgh EH6 6QQ www.gov.scot provision of an LDP, whichever of them is the later in date is to prevail (Town and Country Planning (Scotland) Act 1997 (”the 1997 Act”); section 24(3)). Across Scotland there is a substantial amount of supplementary guidance associated with SDPs and LDPs. Supplementary guidance associated with SDPs will no longer have effect following adoption and publication of NPF4 on 13 February. Supplementary guidance associated with LDPs which was in force before 12 February (the date on which section 13 of the 2019 Act comes into force) will continue to be in force and be part of the development plan (1997 Act; paragraph 2 of schedule 1). As the development plan system transitions to one without statutory supplementary guidance, the Planning (Scotland) Act 2019 (Commencement No.11 and Saving and Transitional Provisions) Regulations 2023 provide for local authorities to continue to prepare and adopt supplementary guidance associated with LDPs until 31 March 2025. Supplementary guidance adopted under those provisions is to be treated as forming part of the development plan for the area to which the LDP relates. The provisions of section 16(1)(a) of the 1997 Act require planning authorities to prepare a new LDP for their area at intervals of no more than 10 years or whenever required to do so by the Scottish Ministers. It will be important for the first round of ‘new style’ LDPs to be prepared in a timely fashion. We expect that every planning authority in Scotland will have a new style plan in place within around 5 years of the new development plan regulations coming into force, which we anticipate happening this spring. Legislation provides for planning authorities to prepare LDPs that include policies and proposals for development and use of land in their area. There is no legal requirement for LDPs to be directly ‘compatible’ with NPF4, although in preparing LDPs, there will be a statutory requirement under section 16(2)(a)(i) of the 1997 Act that planning authorities take the NPF into account. Applying NPF4 Policy Section 25 of the 1997 Act requires that decisions are made in accordance with the development plan unless material considerations indicate otherwise. Application of planning judgement to the circumstances of an individual situation remains essential to all decision making, informed by principles of proportionality and reasonableness. It is important to bear in mind NPF4 must be read and applied as a whole. The intent of each of the 33 policies is set out in NPF4 and can be used to guide decision-making. Conflicts between policies are to be expected. Factors for and against development will be weighed up in the balance of planning judgement. It is recognised that it may take some time for planning authorities and stakeholders to get to grips with the NPF4 policies, and in particular the interface with individual LDP policies. As outlined above, in the event of any incompatibility between a provision of NPF and a provision of an LDP, whichever of them is the later in date is to prevail. Provisions that are contradictory or in conflict would be likely to be considered incompatible. We expect that monitoring of the policies will particularly focus on new and developing policy areas, so that their application in practice can inform future guidance. Below we have set out some more specific advice on individual policies. Page 68 of 72
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Victoria Quay, Edinburgh EH6 6QQ www.gov.scot Policy 1 – Tackling the climate and nature crises This policy prioritises the climate and nature crises in all decisions. It should be applied together with the other policies in NPF4. It will be for the decision maker to determine whether the significant weight to be applied tips the balance in favour for, or against a proposal on the basis of its positive or negative contribution to the climate and nature crises. Policy 2 - Climate mitigation and adaptation There is currently no single accepted methodology for calculating and / or minimising emissions. The emphasis is on reducing emissions as far as possible, rather than eliminating all emissions. At this stage, quantitative assessments are not expected for all applications and there are no defined thresholds that require different levels of information at this stage. Planning authorities will be aware that this is unlikely to be a key consideration for many applications, for example for smaller scale developments, householder applications or many changes of use. However, for other types of development proposals that may generate significant emissions, such as some national or major developments, we consider it to be reasonable to expect quantitative information to be provided. For developments that require an Environmental Impact Assessment (EIA), the impact of the project on climate (e.g. the nature and magnitude of greenhouse gas emissions) and the vulnerability of the project to climate change will have been considered as appropriate in the EIA Report. See Circular 1/2017 for further information. Last year the Scottish Government published carbon management guidance for projects and programmes. Whilst this is aimed at larger scale projects within city region and growth deals and a fully quantified approach is only likely to be proportionately applicable to larger scale proposals, at least whilst practice and methodologies develop over the coming years, the guidance includes useful information and highlights established methodologies which may be of assistance to applicants and planning authorities. Published research on the Lifecycle Greenhouse Gas Emissions of NPF4 Proposed National Developments1, also offers an example of a high-level approach to identifying direct and indirect effects of proposals on GHG emissions which can be embedded into statutory Environmental Assessment obligations. Policy 3 - Biodiversity To support this policy in practice, NatureScot previously consulted on new ‘Developing with Nature guidance’ to accompany NPF4 Biodiversity policy 3c), which is to be applied to certain local development. A final version of the guidance will be available shortly. We are committed to developing guidance to accompany wider NPF4 policy 3, and – recognising that currently there is no single accepted methodology for calculating and / or measuring biodiversity ‘enhancement’ – we have commissioned research to explore options for developing a biodiversity metric or other tool, specifically for use in Scotland. There will be some proposals which will not give rise to opportunities to contribute to the enhancement of biodiversity, and it will be for the decision maker to take into account the policies in NPF4 as a whole, together with material considerations in each case. 1 National Planning Framework 4 - lifecycle greenhouse gas emissions: assessment findings - gov.scot (www.gov.scot) Page 69 of 72
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Victoria Quay, Edinburgh EH6 6QQ www.gov.scot Policy 16 - Quality homes NPF4 sets out a distinct, new approach to planning for new homes across Scotland that aims to deliver more quality homes that meet diverse needs. Policy 16, Quality Homes, promotes a plan-led approach. New style LDPs must include targets for meeting the housing needs of people living in the area, this is referred to in NPF4 as the ”Local Housing Land Requirement” (LHLR) 2. The LHLR will be informed by the Evidence Report and Gate Check process. It is expected that the LHLR will exceed the Minimum All-Tenure Housing Land Requirements (MATHLR) set out in NPF4. Proposed Plans will allocate sites to meet the LHLR and, in doing so, we expect there to be greater emphasis on delivery. Policy 16 looks to incentivise delivery of allocated sites, as they will have been considered and agreed through the comprehensive and participative LDP preparation process. If an LDP reaches Examination without sufficient sites identified to meet the LHLR, a planning authority can be required to prepare another Proposed LDP under new legislative provisions in section 19ZA of the 1997 Act. Once adopted, the delivery of new style LDPs will be monitored and supported through the Housing Land Audit and the LDP Delivery Programme. New guidance on Housing Land Audits will be prepared this year, in collaboration with key stakeholders. The new guidance will seek to ensure a consistent approach is adopted in the preparation of new Housing Land Audits. If needed, collaboration on the LDP Delivery Programme can assist in early consideration of bringing forward longer term sites. Policy 16 is applicable to decision making when NPF4 becomes part of the statutory development plan. As outlined above, SPP(2014) will be superseded and not form part of Scottish Government planning policies, including: the requirement to maintain at least a 5 year supply of effective housing land at all times, shortfalls in supply indicating LDP policies are not up-to-date, the ‘presumption in favour of development that contributes to sustainable development’ and the concept commonly known as the ‘tilted balance’. Consideration must be given as to whether provisions in LDPs are incompatible with provisions of NPF4. Where there is an incompatibility, such as between a housing exceptions policy in an LDP and Policy 16(f) of NPF4, the latter will prevail. Policy 23 - Health and safety We understand that there were some concerns about references within NPF4 to suicide risk, including recognition that LDPs should be informed by awareness of locations of concern for suicide. We would draw your attention to Creating Hope Together (Scotland’s Suicide Prevention Action Plan 2022-2025) which was published last year by the Scottish Government together with COSLA. This recognises the importance of the National Planning Framework in reflecting the role of planning in suicide prevention. Further resources are referenced in the action plan and have been produced by Public Health Scotland. 2NPF4: Annex F provides the Local Housing Land Requirement means “The amount of land required for housing, as identified by the local development plan. The Local Housing Land Requirement (LHLR) is expected to exceed the 10 year Minimum All-Tenure Housing Land Requirement (MATHLR) set out in the National Planning Framework” Page 70 of 72
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Victoria Quay, Edinburgh EH6 6QQ www.gov.scot It may also be useful to see guidance produced by the Welsh Government, which emphasises a pragmatic approach, suggests that suicide prevention should ideally be built into the design of projects and should be compatible with creation of good places. It also references further available practical advice on this. Policy 27(d) - Drive through developments During the Parliamentary scrutiny of the draft NPF4, there was some debate about the meaning and application of Policy 27(d), which states that “drive-through developments will only be supported where they are specifically supported in the LDP”. The intention of this policy was to ensure that this type of development is considered as an integral part of the wider development plan, and is not (as has been erroneously reported) a moratorium or ban on such developments. In applying policy 27(d) and whether such developments are supported, planning authorities may regard wider uses that are compatible with the drive through function to be included, as there is no single class of development that this relates to and may sometimes be considered as sui generis. Suitable locations may include for example those allocated for Class 1 shops or Class 3 Food and drink, depending on the nature of the proposal involved in each case. In looking at the potential impact of the development as a whole, as always, decisions will depend on the facts and circumstances of each individual case and regard should be given to wider policies within NPF4, including those relating to reducing emissions that contribute to climate change and to wider policies that aim to improve town centres and support local living. Looking forward, we will include guidance on drive throughs and the relationship to Policy 27(d) within the forthcoming local development plan guidance, which will be published this spring to support implementation of the new arrangements for LDPs. Further Planning Guidance and Advice In the NPF4 Delivery Programme, we have given our commitment to progress work on a new suite of guidance and advice that will support activity to deliver the policy intent of NPF4. We will do this alongside careful monitoring of the implementation of policies. With some substantial changes being made through the reform of our planning system, both through legislation and in NPF4, there will now be some discrepancies in existing planning guidance and advice as a result. Nevertheless, there will remain aspects which will still be useful for reference through the new planning system and policy approach. Over time, we will review that historic advice as appropriate. Yours faithfully Dr Fiona Simpson Chief Planner Tom Arthur Minister for Public Finance, Planning and Community Wealth Page 71 of 72
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