Agenda reports pack
Argyll and Bute Council · 16 December 2025
Back to Audit and Scrutiny Committee — 16 December 2025 and its agenda
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Argyll and Bute Council Comhairle Earra-Ghàidheal Agus Bhòid Customer Services Executive Director: Douglas Hendry Kilmory, Lochgilphead, PA31 8RT Tel: 01546 605522 DX 599700 LOCHGILPHEAD 9 December 2025 NOTICE OF MEETING A meeting of the AUDIT AND SCRUTINY COMMITTEE will be held BY MICROSOFT TEAMS on TUESDAY, 16 DECEMBER 2025 at 2:00 PM, which you are requested to attend. Douglas Hendry Executive Director BUSINESS 1. APOLOGIES 2. DECLARATIONS OF INTEREST 3. MINUTE OF PREVIOUS MEETING OF THE AUDIT AND SCRUTINY COMMITTEE HELD ON 4 SEPTEMBER 2025 (Pages 3 - 8) AUDIT ITEMS 4. INTERNAL AUDIT AND COUNTER FRAUD SUMMARY OF ACTIVITIES (Pages 9 - 18) Report by Chief Internal Auditor 5. INTERNAL AND EXTERNAL AUDIT REPORT FOLLOW UP 2025-26 (Pages 19 - 34) Report by Chief Internal Auditor SCRUTINY ITEMS 6. PERFORMANCE REPORTING UPDATE (Pages 35 - 40) Report by Executive Director with responsibility for Customer Support Services 7. 2024/25 COUNCIL ANNUAL REPORT (Pages 41 - 110) Report by Chief Executive * 8. TREASURY MANAGEMENT STRATEGY AND ANNUAL INVESTMENT STRATEGY MID-YEAR REVIEW 2025-26 (Pages 111 - 128) Report by Section 95 Officer 9. WORKPLAN (Pages 129 - 130) For noting and updating Public Document Pack
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REPORT(S) FOR NOTING 10. ANNUAL COUNCIL BUSINESS PLAN 2024-25 OUTCOMES (Pages 131 - 178) Report by Chief Executive REPORT(S) FOR CONSIDERATION 11. INTERNAL AUDIT REPORTS TO AUDIT AND SCRUTINY COMMITTEE 2025/2026 (a) Covering Report and Internal Audit Reports (Pages 179 - 284) Report by Chief Internal Auditor • School Residential Trips • Building Cleaning • Directed Self Support (Direct Payments) • Oban Airport • HSCP – Governance Arrangements (For Noting Only) • HSCP – Partnership Working (For Noting Only) • HSCP – Workforce Planning (For Noting Only) E1 (b) Exempt Internal Audit Report (Pages 285 - 306) • ICT Disaster Recovery Items marked with an “asterisk” are items, on the basis of information available at the time this Agenda is published, on which the Committee may not have delegated powers to act, and which may therefore require to be referred to the Council or another Committee, and that referral may depend on the decision reached at the meeting. The Committee will be asked to pass a resolution in terms of Section 50(A)(4) of the Local Government (Scotland) Act 1973 to exclude the public for items of business with an “E” on the grounds that it is likely to involve the disclosure of exempt information as defined in the appropriate paragraph of Part I of Schedule 7a to the Local Government (Scotland) Act 1973. The appropriate paragraphs are:- E1 Paragraph 14 Any action taken or to be taken in connection with the prevention, investigation or prosecution of crime. Audit and Scrutiny Committee Janice Wason Hall (Chair) Councillor Daniel Hampsey Councillor Graham Hardie Councillor Fiona Howard Councillor Reeni Kennedy-Boyle Councillor Gary Mulvaney (Vice-Chair) Councillor Andrew Vennard Contact: Lynsey Innis, Committee and Democratic Services Officer Tel: 01546 604338
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MINUTES of MEETING of AUDIT AND SCRUTINY COMMITTEE held ON A HYBRID BASIS IN THE COUNCIL CHAMBERS, KILMORY, LOCHGILPHEAD AND BY MICROSOFT TEAMS on THURSDAY, 4 SEPTEMBER 2025 Present: Janice Wason Hall (Chair) Councillor Graham Hardie Councillor Fiona Howard Councillor Gary Mulvaney Councillor Andrew Vennard Attending: Paul MacAskill, Chief Internal Auditor Shona Barton, Governance Manager Iain Jackson, Governance, Risk and Safety Manager Alison Jones, Finance Manager Mhairi Weldon, Senior Audit Assistant Mark Outterside, Forvis Mazars 1. APOLOGIES The Chair welcomed everyone to the meeting. Apologies for absence were intimated on behalf of Councillors Daniel Hampsey and Reeni Kennedy-Boyle. 2. DECLARATIONS OF INTEREST There were no declarations of interest intimated. 3. MINUTE OF PREVIOUS MEETING OF THE AUDIT AND SCRUTINY COMMITTEE, HELD ON 12 JUNE 2025 The Minute of the previous meeting of the Audit and Scrutiny Committee, held on 12 June 2025 was approved as a correct record. 4. INTERNAL AUDIT AND COUNTER FRAUD SUMMARY OF ACTIVITIES The Committee gave consideration to a report providing a summary of Internal Audit activity and progress during quarter one of 2025/26 against the following areas: Audits Completed • Education Maintenance Allowance (EMA) • Music Services Verification Audit Work Completed • SPT Annual Claim • Local Government Benchmarking Framework Audits in Planning/in Progress • Self-Directed Support • Payroll – iTrent Page 3 Agenda Item 3
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• ICT Disaster Recovery • School Residential Trips • Capital Programme – Management and Monitoring • Building Cleaning • Oban Airport • HSCP Audits The report also provided information on work carried out by the Counter Fraud Team; the continuous monitoring programme and the progress of work carried out as a result of information received from the National Fraud Initiative. Decision The Audit and Scrutiny Committee reviewed and endorsed the Summary of Activities report. (Reference: Report by Chief Internal Auditor, dated 4 September 2025, submitted) 5. INTERNAL AND EXTERNAL AUDIT REPORT FOLLOW UP 2025-26 Consideration was given to a report which provided an update on all open actions as at 30 June 2025 including information on actions where the agreed implementation date had been rescheduled. Decision The Audit and Scrutiny Committee endorsed the contents of the report. (Reference: Report by Chief internal Auditor, dated 4 September 2025, submitted) 6. INTERNAL AUDIT REPORTS TO AUDIT AND SCRUTINY COMMITTEE 2025/2026 Consideration was given to a report containing the action plans in relation to the following 2 audits:- • Education Maintenance Allowance • Music Service Decision The Audit and Scrutiny Committee reviewed and endorsed the summary report and the detail within each individual report. (Reference: Report by Chief Internal Auditor, dated 4 September 2025, submitted) 7. EXTERNAL AUDIT PROGRESS REPORT The Committee considered a verbal update regarding the progress and current status of ongoing work associated with the completion and delivery of the Annual Audit for 2024-25. It was noted that work remains on schedule, with the Annual Audited Accounts expected to be delivered ahead of timescales achieved in the previous year. Decision Page 4
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The Audit and Scrutiny Committee noted the information provided. 8. INTERNAL AUDIT - ANNUAL SELF-ASSESSMENT Consideration was given to a report which presented the findings from the recent self- assessment of the Council’s Internal Audit service performed by a member of the Internal Audit team. Decision The Audit and Scrutiny Committee reviewed and endorsed the findings of the assessment including the identified areas for improvement, where applicable. (Reference: Report by Chief Internal Auditor, dated 4 September 2025, submitted) 9. CORPORATE COMPLAINTS HANDLING - ANNUAL REPORT 2024/25 Consideration was given to a report which provided information on how the Council dealt with complaints during the period 1 April 2024 and 31 March 2025 and performed against statutory indicators which have been agreed between the Scottish Public Services Ombudsman (SPSO) and the Local Authorities Complaint Handlers Network. Decision The Audit and Scrutiny Committee:- 1. considered and noted the content of the report; and 2. agreed that the Chair and Vice Chair would liaise with the Governance, Risk and Safety Manager to discuss the format of future reports to the Committee. (Reference: Report by Executive Director with responsibility for Legal and Regulatory Support, dated 4 August 2025, submitted) 10. INFORMATION REQUESTS - ANNUAL REPORT 2024/25 Consideration was given to a report which provided an update on the position regarding the recording, responding to, monitoring and reporting of requests for information under the Freedom of Information (Scotland) Act 2002 (FOISA) and the Environmental Information (Scotland) Regulations 2004 (EIR’s) for the period between 1 April 2024 and 31 March 2025. Decision The Audit and Scrutiny Committee considered and noted the information provided. (Reference: Report by Executive Director with responsibility for Legal and Regulatory Support, dated 4 August 2025, submitted) 11. AUDIT AND SCRUTINY COMMITTEE ANNUAL REPORT 2024/25 The Chair presented the Committee’s Annual Report for 2024/25. The report provided the Chair’s annual overview of the Committee’s activity during financial year 2024/25 and a Page 5
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summary of key developments since the commencement of 2025/26. The report also set out how the Committee has fulfilled its remit and provides assurances to the Council. Decision The Audit and Scrutiny Committee:- 1. reviewed and endorsed the Chair’s Annual Report; and 2. agreed that the Chair present the report to the Council, at their meeting scheduled to take place on 26 November 2025. (Reference: Report by Chair of the Audit and Scrutiny Committee, dated 4 September 2025, submitted) 12. STRATEGIC RISK ASSURANCE MAPPING Consideration was given to a report which set out Internal Audit’s assessment of the sources of assurance for the Audit and Scrutiny Committee on the management of the Council’s strategic risks. Decision The Audit and Scrutiny Committee agreed to note the risk assurance map contained at appendix 1 of the report. (Reference: Report by Chief Internal Auditor, dated 4 September 2025, submitted) 13. STRATEGIC RISK REGISTER The Committee gave consideration to a report which provided an update on the Council’s Strategic Risk Register. Decision The Audit and Scrutiny Committee endorsed the updated Strategic Risk Register, contained at appendix 1 of the report. (Reference: Report by Chief Executive, dated 4 September 2025, submitted) 14. TREASURY MANAGEMENT UPDATE - QUARTER ENDED 30 JUNE 2025 The Committee gave consideration to a report which provided an update on the Council’s treasury management activity during the quarter 1 April to 30 June 2025 and the overall position as at 30 June 2025. Decision The Audit and Scrutiny Committee considered and noted the contents of the report and the treasury activity during the period 1 April to 30 June 2025. (Reference: Report by Interim Head of Financial Services, dated 8 August 2025, submitted) Page 6
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15. WORKPLAN The Audit and Scrutiny Committee Workplan was before the Committee for noting. Decision The Audit and Scrutiny Committee noted the content of the Workplan. (Reference: Workplan of the Audit and Scrutiny Committee, dated 4 September 2025, submitted) Page 7
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ARGYLL AND BUTE COUNCIL AUDIT & SCRUTINY COMMITTEE FINANCIAL SERVICES 16 DECEMBER 2025 INTERNAL AUDIT AND COUNTER FRAUD SUMMARY OF ACTIVITIES 1. SUMMARY 1.1 The objective of the report is to provide the Audit and Scrutiny Committee (the Committee) with a summary of Internal Audit activity and progress during quarter 3 of 2025/26. 1.2 Core activities together with a progress update statement are shown below: • 2025/26 Individual Audits undertaken: Eight audits have been completed during the period, 4 have been assessed as providing high assurance, one substantial assurance, 2 reasonable assurance and one limited assurance. (Where HSCP and LiveArgyll Audits are included, these are provided for information only). • 2025/26 Audit Plan progress: The plan is currently on track. In the event that this position was to change, we will flag it to the Committee as part of the quarterly updates. • Scrutiny: Planned work for 2025/26 has been agreed by the Committee along with those who will serve on the Panel, and work on this will commence in January 2026. • Counter Fraud: The Counter Fraud Team (CFT) is continuing to rebill council tax accounts and recovery of funds is underway. All other aspects and referrals are being considered, investigated and evaluated and the Counter Fraud Team remain vigilant to protect our public purse. All CFT team members have completed the accredited CIPFA Fraud Specialist Course. The team lead is currently progressing toward the completion of year 4 of a Master in Accountancy course. • Continuous Monitoring Programme Testing: A number of auditable units are subject to continuous testing. There has been one new issue identified this quarter. • Performance indicators: Current status is green / on track. 2. RECOMMENDATIONS 2.1 To review and endorse the Summary of Activities report. Page 9 Agenda Item 4
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3. DETAIL 3.1 Eight audits have been completed since the previous Committee in September 2025. Audits Completed • Oban Airport • ICT Disaster Recovery • School Residential Trips • Self-Directed Support • Building Cleaning • HSCP Governance Arrangements -for information only • HSCP Partnership Working – for information only • HSCP Workforce Planning – for information only Verification Audit Work Completed • N/A Audits in Planning / in Progress reported to a future meeting of the Committee. • Capital Programme – Management and Monitoring (awaiting management response to draft report) • Payroll – iTrent • Performance Management Arrangements and Reporting • Project Management • Street Lighting 3.2 In addition to those already in progress, indicative audits planned for 2025/26 are: • Eclipse • Rural Growth Deal • Whistleblowing • LiveArgyll Building/Property Maintenance 2025/26 Audit Plan 3.3 Work is ongoing and is currently on track at this point in time. Only one amendment to the plan should be noted and that relates to the strategic Procurement review which has been postponed to another audit plan when the work will be more appropriate to be undertaken. Scrutiny 3.4 It was agreed by the Committee that the chosen subject area for the 2025/26 scrutiny review would be on the Council’s preparedness for the Bio-Municipal Page 10
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Waste (BMW) Landfill Ban. A background and scoping document will be prepared and issued to the Panel members for agreement in due course. We anticipate that this will commence early in January 2026. Counter Fraud 3.5 The CFT is progressing well with both team members fully CIPFA accredited fraud investigators. The team now consists of 2 full time staff after completing secondments. Both team members are fully trained under the accredited CIPFA fraud course. 3.6 Routine work continues and is progressing to track the full income due and to be recovered as part of this ongoing work. Based on the amount of additional billing, even accounting for a degree of non-recovery, the indications are that the team are anticipating exceeding their annual target. In addition, the team are raising awareness of the Council’s zero tolerance to fraud and this will help act as a deterrent to fraud being perpetrated in the first place. 3.7 Visits continue to play a vital role in the CFTs proactive and reactive work. Recent visits have taken place in Mull, Campbeltown and Tarbert. Work is still underway for Helensburgh. Further efforts toward Coll had to be delayed due to Storm Amy. Travel to the outer islands will commence spring 2026. Both officers continue to be proactive and make visits when information is received via the online portal and other islands will soon be visited. 3.8 The CFT continue to link in with Internal Audit and Debt Recovery, and where necessary to assist, trace persons and open communication to long term debts for recovery. Several cases have resulted in large scale rebilling. 3.9 Second homes and Non-Domestic Rates are playing larger roles in the CFT’s investigations with several claims already adjusted. These will remain proactive areas. 3.10 The CFT continue to work closely with the empty homes team to support each other in our remits. Work and communication between each department is key in identifying and finding appropriate solutions to enable empty homes to return to residency or open market. 3.11 The NFI exercise continues to be a routine work area for the CFT. The 2024/2025 exercise had extra data uploaded this September and work on this element will commence when this has been matched and results released. The initial part of the matching exercise is coming to a close. Any remedial or conclusive work will be completed when and where appropriate. The system is reviewed periodically for any updates. 3.12 Since the inception of the CFT a total of £1,553,043,262 has been rebilled and £1,048,213 has been recovered. A recovery percentage of 68% has been achieved at the last review of the figures. Recent large rebilling has been passed to other agencies, and this takes time to process and progress payment plans. Additional Updates from Quarter Three 3.13 The Council has entered a ten-year programme to deliver the Rural Growth Deal (RGD) for Argyll and Bute. The Council, as the accountable body for this Page 11
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programme is required to allocate and account for distribution of the funding to partners, third parties and other bodies in accordance with the approved governance arrangements. The Council’s Chief Internal Auditor has been appointed to coordinate audit activity throughout the programme, this will include liaison with partner auditors to obtain annual confirmation of regular and planned reviews of grant funded activities and a specific review of RGD within the Council’s Annual Audit Plan at least every two years. Discussions regarding the audit input required have taken place and the first review will be included within the 2025/26 Internal Audit Plan. We will closely monitor the additional work associated with this appointment going forward and determine whether additional resources may be required. 3.14 Our work as the contracted Internal Auditors for the HSCP has been progressing well and priority has been given in this area due to staff availability, therefore, we have been able to complete our work for 2025/26. We will continue to monitor and report progress to the HSCP’s Audit and Risk Committee in relation to the implementation of recommendations made in previous reports. 3.15 Internal Audit staff continue to increase their skills and ultimately aim to complete appropriate professional qualifications at the end of their training programmes. Internal Audit have two staff members who are undertaking formal professional training; training is at differing stages but is progressing as expected at this time. The aim is to develop and retain professional staff on the completion of the qualifications and increase resilience within the service. Continuous Monitoring 3.16 Our continuous monitoring programme is generally focused on transactional type activity. Standard audit tests are applied which are relevant to each auditable unit. Control design tests look at whether the controls in place adequately address the potential risk event. There has been one new finding within the quarter that requires to be reported. Table 1: Continuous Monitoring Findings Auditable Area Areas Tested Issues Identified Management comment / action Payroll Expenses Five out of 37 expense claims tested were found to have been authorised by managers/appropriate persons but receipts were either missing or did not align with the claim period, additionally, there was no evidence of Executive Director approval for claims over 6 months old. The respective Managers/authorisers were notified of the findings via email and advised that the guidance on the HUB must be adhered to and the importance of this. Four responses were received assuring that the guidance would be followed in future and despite sending 3 emails, no response was received for the 5th claim tested. 3.17 A process is in place whereby management are advised of continuous monitoring findings and, where appropriate, requested to take remedial action. Due to the Page 12
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volume of continuous monitoring tests carried out the decision was made to report by exception only. National Reports 3.18 A follow up process for national reports is in place whereby management are advised of national reports published and asked to confirm what, if any, action is planned as a result of the report. Table 2 details the national reports issued during quarter two of 2025/26 due to be reported in quarter three. Table 2: National Reports National Report Issued To Detail Management response/ Action taken Delivering for the future: Responding to the workforce challenge Executive Director Kirsty Flanagan Scotland’s councils urgently need to make progress with workforce plans if they are to protect services and financial sustainability. ‘Following publication of the Workforce Challenges report in August 2025, the Council has been assessing our current People Strategy and Strategic Workforce Plan against the Commission’s recommendations. This self- assessment will be reported in the first instance to the Executive Leadership Team in Spring 2026 and any improvements identified for inclusion in future iterations of the Strategic workforce documents.’ Flooding in Communities: Moving towards flood resilience Executive Director Kirsty Flanagan Flooding is getting worse because of changes to our climate. It’s likely flooding will happen more often. A request has been made to schedule this report for discussion at the next Scottish Collaboration of Transportation Specialists (SCOTS) meeting on 12 December, thereafter, a report will be prepared for the Council’s Environment, Development and Infrastructure (EDI) Committee. The 2023/24 audit of Glasgow City Council Chief Executive The processes, decisions and actions that enabled five senior Glasgow city Council officers to take significant early retirement and redundancy payouts fell short of the behaviour and standards expected of public servants. A stand-alone report to be submitted to a future meeting of the Audit and Scrutiny Committee. Page 13
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Cyber-attack affecting operations and services: The 2023/24 audit of Comhairle nan Eilan Siar Executive Director Kirsty Flanagan All Scottish councils must learn from the immediate and ongoing impacts of a significant cyber- attack on Comhairle nan Eilean Siar. Argyll and Bute Council actively manages cyber security risk through its Strategic Risk Register, regular reviews, and robust IT protocols using specialized software, while acknowledging that absolute prevention cannot be guaranteed. The Council collaborates with other authorities, including Comhairle nan Eilean Siar, for mutual learning and recovery support, and participates in the Scottish Local Authority Information Security Group (SLAISG) for information sharing and best practices. Cyber risk remains a key focus, with efforts centred on minimizing threats and ensuring readiness and preparation for potential attacks. National Fraud Initiative (NFI) 3.19 NFI data matching involves comparing computer records held by one body against other computer records held by the same or another body to identify potentially fraudulent claims and payments to be identified. Note though that the inclusion of personal data within a data matching exercise does not mean that any specific individual is under suspicion. Where a match is found it indicates that there may be an inconsistency which requires further investigation. No assumption can be made as to whether there is fraud, error or other explanation until an investigation is carried out. A reminder process is in place to ensure that matches are reviewed on a timely basis. 3.20 The previous NFI exercise has been completed and results published by Audit Scotland. This exercise was conducted by officers and matches checked and closed accordingly. NFI provided additional data releases over the course of the exercise and matches were addressed when these became available. 3.21 Existing users have been reviewed and new users added where requested, all users have been and will continue to be informed that matches are available for review. Progress in investigating matches will be monitored monthly by the Counter Fraud team and reported quarterly to the Audit and Scrutiny Committee. 3.22 New HMRC data has been uploaded and released back to us, the respective teams have been contacted to start matching this data. 3.23 The NFI exercise for 2024/25 has commenced with the data uploads so far submitted to the Cabinet office for review and therefore data matching when released. The new NFI matches will appear in the table below as and when they have been released and checked. More uploads have been given to Cabinet office during November 2025 and will be matched once released. Page 14
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Table 4: National Fraud Initiative Progress at 16/11/2025 Operational Area Total Matches Recommended/Very High / High/ Medium Risk Matches Matches Complete * WIP Match Description CT to Elect Register 2422 0 2422 0 CT records to Electoral Register/ other data sets to ensure discount awarded to only those living alone aged over 18, taking into account disregarded occupants. (CT to other Datasets will not be progressed further due to poor quality data) CT rising 18s 85 0 85 0 CT to HMRC Household Composition 1106 0 1106 0 Housing Benefits 13 9 11 0 HB records to records in other authorities / other datasets including student loans, payroll and pensions to identify undeclared income and capital. Payroll 300 107 61 0 Payroll records to other datasets including other payrolls and pensions to ensure employee is not receiving additional income. Blue Badges 200 200 200 0 Blue badge records to DWP data to identify deceased claimant with valid badge. Housing Waiting list 262 258 227 0 Housing waiting list records to other organisations HBCTR and tenant data to identify undisclosed changes in circs or false info. Council Tax Reduction 638 174 206 3 CTR records with records in other authorities / other datasets including; student loans, payroll and pensions to identify undeclared income and capital Creditors 2340 0 1126 0 Analyses Creditors data to identify possible duplicate vendors and payments, VAT errors or fraud and multiple vendors sharing a bank account. Procurement 67 0 14 0 Payroll records to Companies House and creditors’ data to identify employees who appear to have a personal interest in a company that the authority has traded with. Business Rates 154 0 154 0 Business rates records within and between authorities to identify those fraudulently claiming small business bonus scheme and grants Page 15
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* Work in Progress Overall Summary of Matches Matches Complete Work In Progress Cleared Frauds Errors Total Value £ Recovering Recovering Value £ 5612 3 5532 0 80 62,726 0 0 Internal Audit Development 3.24 The table below details progress against the action points in our Internal Audit development plan. Table 5: Internal Audit Development Key Actions: updated 18/11/25. Area For Improvement Agreed Action Progress Update Timescale Review Continuous Monitoring Programme The Continuous Monitoring Programme will be reviewed to assess value of existing tests carried out and establish where these can be enhanced with greater use of data analytics. In progress March2026 Follow-up Performance Reporting Develop performance reporting dashboard on Power BI In progress March 2026 3.25 Internal Audit scorecard data provided below are aligned to those for internal audit in the Financial Services service plan. All indicators are shown as currently being on track. Table 6: Internal Audit Team Scorecard Internal Audit Team Scorecard 2025– 26 – FQ2 25/26 (as at September 2025) BO115 We Are Efficient and Cost Effective Internal Audit Level of Satisfaction Actual 100% G Target 80% Review of Strategic Risk register Status On Track G Target On Track Percentage of audit plan completed Status 100% G Target 80% Percentage of audit recommendations accepted by management Actual 100% G Target 100% Page 16
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4 CONCLUSION 4.1 The 2025/26 audit plan is progressing as anticipated at this stage in the year, together with the Counter Fraud Team continuing with visits and pro-active work throughout Argyll and Bute. 5 IMPLICATIONS 5.1 Policy – Internal Audit continues to adopt a risk-based approach to activity 5.2 Financial – None 5.3 Legal – None 5.4 HR – None 5.5 Customer Service – None 5.6 Risk – None 5.7 Climate Change – None 5.8 Fairer Scotland Duty – None 5.9 Equalities – protected characteristics – None 5.10 Consumer Duty – None 5.11 Island Communities – None 5.12 Children’s Rights and Wellbeing – None For further information please contact Internal Audit (01546 604108) Paul Macaskill Chief Internal Auditor 16 December 2025 Page 17
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE FINANCIAL SERVICES 16 December 2025 INTERNAL AND EXTERNAL AUDIT REPORT FOLLOW UP 2025-26 1.0 INTRODUCTION 1.1 Internal and external audit reports include an action plan with a management response establishing the agreed action, timescale and responsible officer. Internal Audit record these in a database and, on a quarterly basis, follow them up to ensure they are being progressed. 1.2 This report updates the committee on all open actions as at 30 September 2025 including information on actions where the agreed implementation date has been rescheduled or evidence is required to confirm completion. 2.0 RECOMMENDATIONS 2.1 To endorse the contents of the report. 3.0 DETAIL 3.1 The two tables below provide a numerical summary of open audit actions with a split between actions due by and due after 30 September 2025. 3.2 Appendix 1 provides a visual representation of progress in addressing agreed actions. 3.3 Appendix 2 provides further detail on actions that have been delayed and rescheduled or where evidence is required to confirm completion. Page 19 Agenda Item 5
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Table 1 – Actions due by 30 September 2025 Service Complete Delayed/ Rescheduled Evidence Required Total Internal Audit DH – Commercial Services 1 1 DH – Education Wellbeing, Inclusion & Achievement 1 1 DH – Legal & Regulatory Support 1 1 KF – Development & Economic Growth 1 2 3 KF – Roads & Infrastructure Services 3 1 4 H&SCP (SW) – Adult Services (Mental Health Learning Disability, Addictions & Lifelong Conditions) 2 2 H&SCP (SW) – Adult Services (Older Adults & Community Hospitals) 1 1 H&SCP (SW) – Finance/Transformation 1 1 H&SCP (SW) – Strategic Planning & Performance 1 1 2 H&SCP (IJB) – Adult Services (Older Adults & Community Hospitals) 1 1 H&SCP (IJB) – Finance/Transformation 2 2 H&SCP (IJB) – Strategic Planning & Performance 6 6 LiveArgyll 1 1 External Audit Nil TOTAL 8 17 1 26 Table 2 – Actions due after 30 September 2025 Service Complete On Course Delayed/ Rescheduled Total Internal Audit DH – Commercial Services 1 1 DH – Education Performance & Improvement 4 4 DH – Education Wellbeing, Inclusion & Achievement 5 5 DH – Legal & Regulatory Support 6 6 KF – Development & Economic Growth 1 1 KF – Financial Services 1 2 1 4 KF – Roads & Infrastructure Services 1 7 8 H&SCP (SW) – Children & Families and Criminal Justice 7 1 8 H&SCP (IJB) – Strategic Planning & Performance 7 7 External Audit Nil TOTAL 2 39 3 44 Page 20
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4.0 CONCLUSION 4.1 Satisfactory progress continues to be made implementing audit actions. 5.0 IMPLICATIONS 5.1 Policy – None 5.2 Financial – None 5.3 Legal – None 5.4 HR – None 5.5 Customer Service – None 5.6 Risk – None 5.7 Climate Change – None 5.8 Fairer Scotland Duty – None 5.9 Equalities – protected characteristics – None 5.10 Consumer Duty – None 5.11 Island Communities – None 5.12 Children’s Rights and Wellbeing – None Paul MacAskill Chief Internal Auditor 16 December 2025 For further information contact: Paul MacAskill, 01546 604108 Paul.macaskill@argyll-bute.gov.uk APPENDICES Appendix 1 – Visual representation of progress in addressing agreed actions Appendix 2 – Action Plan Points Delayed & Rescheduled or Evidence Required Page 21
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Appendix 1 – Visual representation of progress in addressing agreed actions as at 30 September 2025 Page 22
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Appendix 2 – Action Plan Points - Delayed and Rescheduled or Evidence Required Action Plan Points due by 30th September 2025 Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer LOW COMMERCIAL SERVICES Asbestos Management 7. Site Responsible Person Records Services should advise Property Services of any changes of staff nominated as SRP but in practice this does not happen consistently meaning that these records are not up to date. Property Services have in the past issued emails to Heads of Services asking for staffing updates, but due to a lack of response this practice was stopped. Consideration should be given to whether this could be reinstated and where there is no response if this should be escalated to DMT/SMT. Property Services will issue emails to Heads of Services asking for staffing updates then enter details into Concerto. 30/09/2025 31 Dec 2025 Extension required to 31 December 2025 to accommodate statutory requirements of Martyn's Law. While the actions that will be taken remain mostly the same, the processes are being updated to reflect the statutory requirements within Martyn’s Law. This will include increased frequency of checking, with Heads of Service, for changes in site responsible persons from annually to 6 monthly. Updated Facility Responsible Person Records are completed and input on concerto. Email to be issued to all Heads of Service in November 2025 with response due by end November. Delayed and Rescheduled Commercial Services Admin Officer MEDIUM DEVELOPMENT & ECONOMIC GROWTH PLANNING 1. Staff Training Planning do not currently have in place a training schedule for 2023/24 for planning officers. Once the incorporation of the IDOX project is completed a training schedule will be introduced covering both the new system and other relevant areas such as the National planning for framework 4. 31/03/2024 31/12/2024 31/03/2025 30/06/2025 30/09/2025 31 Mar 2026 Planning staff have access to a full programme of training during the year held internally, or externally, as appropriate. In 2025/26 a programme of training is currently being collated. A formalised training schedule has still to be completed however action has already been taken forward to Process and Productivity Improvement Officer Page 23
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer deliver on several training themes identified by staff. This has included an event on considering the implications of the grid enhancement (April 2025), and sessions during Feb and March 2025 relating to Trees and EIA development. It is confirmed that the most pressing training needs have been identified and are being delivered/progressed whilst a training plan that addresses wider requirements remains under production. In addition, staff can access a range of digital courses specialising in Planning topics and there is also a range of internal courses available on back-office systems, corporate priorities, and other topics such as cyber security and the use of AI and digital tools such as copilot etc. Creating a training schedule is however still complicated by a lack of available external courses. That said, when staff do attend these, they are also asked to cascade learning to other colleagues through notes taken. Lastly, the council is also undertaking a transformational process, and planners attend an increasing number of Page 24
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer workshops and seminars that often involve a place-based approach working with other council services and external partners. The Scottish Government have also set up a Planning Hub to help share expertise with Planning Authorities. This approach is likely to increase in the future. Delayed and Rescheduled HIGH DEVELOPMENT & ECONOMIC GROWTH SHORT TERM LETS 1. Procedures Whilst policies and procedures that are in place are comprehensive, there are some elements of the policies which require to be completed in parts. This includes policies/procedures around Enforcement and Renewals that still require to be brought together and circulated. Other developments are noted for progression on Oracle. 1. Develop a Short-term Let Enforcement policy 2. Develop procedures for the renewal of Short-term let Licences 3. Secure changes to the Oracle STL system, including a searchable public register, a template licence revocation letter, with this status being added to oracle and tracking these 4. Develop a template for provisional licence, including cover letter 5. Include a new Licence type - “Transfer Licence” and new application status entitled “transferred”. 30/09/2025 31 Dec 2025 Good progress is being made to deliver these actions. 1. STL Enforcement - not progressed yet. 2. Renewal procedure developed and in place. Revised STL Policy approved by Council on 26 June 2025, together with fees. 3. IT system being updated and developed to accept on-line applications and payments. System testing ongoing but currently cannot accept on-line renewal applications. Alternative arrangements in place. 4. IT is working on new public register. Revocation form part of enforcement policy and procedures (see 1 above). 5. IT development to process transfers is complete. Regulatory Services and Building Standards Manager Page 25
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer Delayed and Rescheduled LOW ROADS & INFRASTRUCTURE SERVICES Burial Records 6. Historical Register Information Finding; The Burial and Cremation (Scotland) Act 2016 (The Act) requires information to be retained electronically although this is not currently in force it will be at a future date. The BACAS system has been partially updated with historical information recorded in burial registers; it has not been possible to update with all information due to the volume of work involved. Recommendation; Source temporary additional resource to update historical burial records on BACAS. The service will source temporary assistance to update records during Summer 2024. 30/06/2024 31/12/2024 30/06/2025 30/09/2025 31 Dec 2027 The input of historical records is progressing within the existing Roads and Amenity administrative support team as it has not been possible to obtain additional resource. This project is significantly more onerous than initially considered and is creating pressure on the team to complete a piece of work that is not currently legislative. A more realistic timeframe has therefore been established to complete this work and allow the admin team to prioritise business as usual and progress with this recommendation when resources permit. Delayed and Rescheduled Operations Manager, Roads and Infrastructure Services LOW ADULT SERVICES (OLDER ADULTS & COMMUNITY HOSPITALS) Adult Services - Adult Support & Protection 1. Progress Whilst significant progress has been made to address the key areas identified within the report there remains challenges in terms of ensuring attendance by all relevant partners at case conferences, ensuring that chronologies and risk assessments are completed and ensuring that the ‘three-point test’ is undertaken. Adult services will facilitate an ASP audit on a six monthly basis to determine practice and compliance with ASP legislation and KPIs. 30/09/2024 31/12/2024 31/08/2025 31 Dec 2025 Audit complete and report recently shared with Senior Leadership Team. Due to go to Adult Protection Committee and Social Work governance (Chaired by Chief Social Work Officer). Will also go to Chief officer Group for Public Protection. Action plan in development, evidence will be provided once progressed through low-level governance. Head of Adult Services (Mental Health, Acute and Complex Care) Page 26
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer Delayed and Rescheduled MEDIUM FINANCE/TRANSFORMATION INFORMATION GOVERNANCE 1. Documentation Review Reviews are outstanding in regard to; · Records Management Plan · Information Governance policy framework A review of all relevant documents will be carried out. RMP will be reviewed and submitted to Keeper around February 2025. IG policy to be reviewed. 31/03/2025 30/09/2025 31 Dec 2025 The new date for submission of the RMP to the Keeper is 31 December 2025. Delayed and Rescheduled Governance, Risk & Safety Manager MEDIUM FINANCE/TRANSFORMATION INFORMATION GOVERNANCE 2. Improvement Plan A number of improvement recommendations made by the Keeper of Scotland were identified in the following areas: · Business Classification · Retention Schedule · Destruction Arrangements · Archiving and Transfer · Business Continuity and Vital Records · Audit Trail An action Plan to address these areas should be implemented Develop and implement an action plan to address the Keeper of Scotland's improvement recommendations, ensuring that all aspects of records management are up-to-date, compliant, and effectively managed. Will be reviewed as part of RMP submission to Keeper. 31/03/2025 30/09/2025 31 Dec 2025 The new date for submission of the RMP to the Keeper is 31 December 2025. Delayed and Rescheduled Governance, Risk & Safety Manager MEDIUM STRATEGIC PLANNING AND PERFORMANCE HSCP CULTURE 1. Surveys Recent surveys undertaken by each organisation do not focus specifically on the HSCP in terms of culture (how are the services working together, communicating with each other, sharing information), instead focussing on staff experiences in each organisation. HR leads within ABC and NHSH to review survey landscape and explore joint survey option over and above existing employer only surveys. To report to SLT and JPF. 31/03/2025 30/09/2025 31 Mar 2026 Discussion between both employers and Chief Officer with conclusion that the iMatter annual survey is for all employees in the HSCP regardless of employer and therefore further survey at this stage is not required, however, any disbandment of the Culture Group would need to be put to Audit & Risk. Staff issues have delayed this action further. Delayed and Rescheduled Depute Director of People, NHS Highland MEDI UM STRATEGIC PLANNING AND PERFORMANCE HSCP CULTURE Refresh and review of the remit and purpose of the Culture 31/03/2025 30/09/2025 Agreement between staffside lead for Argyll and Bute, Chief Depute Director of People, NHS Highland Page 27
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer 2. Work Plan The work plan outlines priorities, outcomes, responsible person and timeframes. However, these are not specific, targeted or in some instances easily measurable with target dates for completion marked as ‘ongoing’. Group. The work plan will be included as part of the review to focus on meaningful action and timescales. 31 Mar 2026 Officer and both HR leads that the Culture Group was no longer required. The JPF ToR, standard agenda and workplan were reviewed to include the areas and items that had previously been part of the culture group remit, however, any disbandment of the Culture Group would need to be put to Audit & Risk. Staff issues have delayed this action further. Delayed and Rescheduled MEDIUM STRATEGIC PLANNING AND PERFORMANCE HSCP CULTURE 3. Monitoring Progress There does not seem to be progress notes assigned to the work plan therefore difficult to assess, without reading every meeting note what progress has made. In addition, as noted above a number of targets dates are simply noted as ‘ongoing’. Refresh and review of the remit and purpose of the Culture Group to include timescales and progress reporting as appropriate. 31/03/2025 30/09/2025 31 Mar 2026 Agreement between staff side lead for Argyll & Bute, Chief Officer and both HR leads that the Culture group was no longer required. The JPF ToR, standard agenda and workplan were reviewed to include the areas and items that had previously been part of the culture group remit, however, any disbandment of the Culture Group would need to be put to Audit & Risk. Staff issues have delayed this action further. Delayed and Rescheduled Depute Director of People, NHS Highland MEDIUM STRATEGIC PLANNING AND PERFORMANCE HSCP CULTURE 4. Survey Participation Chief Officer to communicate commencement of surveys to all staff via CO comms. 31/03/2025 30/09/2025 31 Mar 2026 Agreed that the National iMatter survey would be the tool used. Staff issues have delayed this action further. Delayed and Rescheduled Chief Officer Page 28
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer The results of surveys have demonstrated engagement and participation by HSCP staff could be improved. MEDIUM STRATEGIC PLANNING AND PERFORMANCE HSCP CULTURE 5. Culture and Wellbeing Group Whilst the Culture Group is open to all staff across the HSCP, there is a greater proportion of representation of NHS staff. As per refresh and review of Culture Group, review membership as a result of revised remit and purpose. 31/03/2025 30/09/2025 31 Mar 2026 Agreement between staff side lead for Argyll & Bute, Chief Officer and both HR leads that the Culture group was no longer required. The JPF ToR, standard agenda and workplan were reviewed to include the areas and items that had previously been part of the culture group remit, however, any disbandment of the Culture Group would need to be put to Audit & Risk. Staff issues have delayed this action further. Delayed and Rescheduled Depute Director of People, NHS Highland LOW STRATEGIC PLANNING AND PERFORMANCE Risk Management 3. Training It is noted that there is an outstanding audit action since June 2021 covering; · Training for new members of IJB and Audit Committee · training for Risk leads · maintenance of training records Recommendation accepted. A training programme based upon the use of the Smartsheet system is being developed. 31/12/2023 30/06/2024 31/12/2024 30/09/2025 31 Dec 2025 Note the agreed action is changed, as Smartsheet will be replaced by in Phase, which has been delayed. A TURAS module in risk is available to all staff, at present, however, uptake has not been high. Audit Committee training identified and pending funding approval. Delayed and Rescheduled Business Improvement Manager MEDIUM ADULT SERVICES (MENTAL HEALTH LEARNING DISABILITY, ADDICTIONS & LIFELONG CONDITIONS/CSWO) CLIENT FUNDS PROGRESS REVIEW 2. Meeting service users' financial needs The HSCP will work with Procurement Commercial and Contract Management Team (PCCMT) to identify appropriate options within each area. This issue, which is not within the 30/12/2024 31/03/2025 30/06/2025 30/09/2025 31 Dec 2025 PCCMT has provided options which need to be reviewed and considered. Delayed and Rescheduled SW Admin Manager Page 29
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer This is a restricted report, please contact Internal Audit directly if you are responsible for updating this action. control of the HSCP, is likely to recur, generating significant additional work. MEDIUM ADULT SERVICES (MENTAL HEALTH LEARNING DISABILITY, ADDICTIONS & LIFELONG CONDITIONS/CSWO) Learning & Physical Disability Care Packages 3. Case Notes Case notes are maintained on Eclipse, the replacement client database for Carefirst. It was noted that case notes were not always maintained and up to date. Record keeping session (s) to be delivered by professional lead · Senior Managers to implement case note audit within their respective services – this should be linked to individual practitioner supervision 30/06/2024 31/12/2024 31/03/2025 30/09/2025 31 Jan 2026 Reassigned to another Professional Team Lead, who will revisit the case file audit process, and peer audit case files per team/service, per month. This will be tailored to meet the requirements of Eclipse. For record keeping sessions, this will need time to plan this and deliver it. Audit practice notes for LD will be addressed through supervision. In addition, audit tools to be applied to AHP, and completed by OT and SALT. Nurses have a different tool, and looking to also complete, as well as for Psychology. Delayed and Rescheduled Senior Managers (Adult Services) MEDIUM FINANCE/TRANSFORMATION Payroll Procedure for HSCP Care at Home 1. Processes Payroll processes for Care at Home staff are manually intensive involving a 3-stage process transferring information at each stage of the process. This increases risks of error, although risks are mitigated through authorisation processes and checking of information efficiencies could be made by considering a more automated approach. The process for payroll will be reviewed and any recommendations implemented. If following consultation with the Finance Manager, it is determined that no improvements can be made this action will be closed pending purchase of a new automated system or further development of the iTrent system. 30/09/2025 31 May 2026 The Council are in the process of developing a new app, Pay Time, which, if implemented, will address this issue. The Council are suggesting that testing will begin in November 2025. It will be rolled out to the HSCP if the testing is successful. A precise implementation date is not within the control of the HSCP. It is suggested that this SW Admin Manager Page 30
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer recommendation is next reviewed in 6 months, at which stage there should be a clear implementation date from the Council. Delayed and Rescheduled MEDIUM STRATEGIC PLANNING AND PERFORMANCE Learning & Physical Disability Care Packages 7. Unmet Need Unmet need for Older People Care at Home is collated by the resources team on a weekly basis, this is then submitted to Performance and Improvement Team and is reported to Scottish Government. The data for Learning Disability is not currently recorded formally and not included in the above. Include the data re unmet need for those under 65 in the weekly reporting format already in place for Older People. 30/06/2024 30/09/2024 31/08/2025 31 Dec 2025 Unmet need for Homecare for under 65's should be included in the regular locality returns, however, there is a variable response in respect of persons with MH or LD with most localities maintaining that they don't record this. No separate record is currently maintained, and this was to be reviewed and included in the ongoing "Resources Services" and commissioning practice that is being developed. Delayed and Rescheduled Head of Strategic Planning, Performance and Technology & Head of Adult Services (Health & Community Care) LOW LIVEARGYLL Disclosure Checks – PVG 2. Policies, Procedures & Guidance Finding: The Manager’s Guide to Recruitment lacks version control to help users ensure they are using the most current and up-to-date version and the Safeguarding Policy requires amendment to correct/remove errors. Recommendation: When updating documentation to incorporate new legislation, Management should ensure that version control is applied and all errors corrected/removed. Document control protocols in relation to legislative updates will be reviewed and the process updated where needed. 31/07/2025 Version control has been added to the Managers Guide to Recruitment, the Safeguarding Policy has been updated but an error appears to remain, update to follow. Evidence Required Services and Support Manager Page 31
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Action Plan Points due after 30th September 2025 Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer LOW DEVELOPMENT & ECONOMIC GROWTH Private Sector Housing Grants & Adaptions 3. Procedure Notes and Shared Documents While the vast majority of requirements are included there would be benefit to updating these to reflect current working practices, which have evolved due to hybrid working arrangements and the digitalisation of records. Consideration should be given to creating a checklist to ensure consistent application of processes. Procedures and documents will be reviewed and updated. Checklists to be drawn up and introduced when updating the procedures. 31/12/2022 30/06/2023 31/03/2024 30/09/2024 30/12/2024 30/06/2025 31/10/2025 31 Jan 2026 Long term sickness absence since April 2025 has prevented any progress. Phased return planned for October. Revised timetable will need to be agreed. The Scheme of Assistance was only approved by Council at its meeting in April this year as the February meeting agenda was full. As a result, work on revising the processes, procedures, and any checklists could not be taken forward until this point Delayed and Rescheduled Team Lead - Housing Operations LOW FINANCIAL SERVICES Preparedness for IFRS16 1. Database Maintenance Continuing to meet the requirements of IFRS 16 will rely on good communication with departments and a clear understanding of the processes involved for updating Financial Services with new lease arrangements or changes to existing lease arrangements. Policy document and training will be developed to provide a framework for ongoing compliance with IFRS16 Leases and will be reviewed and updated as appropriate. 31/12/2025 31 Jan 2026 Pushing back one month to allow for competing priorities. Delayed and Rescheduled Finance Manager Page 32
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Service, Report, Plan no. & Finding Agreed Action Original and Revised Dates Comment Responsible Officer LOW CHILDREN AND FAMILIES AND CRIMINAL JUSTICE Payroll Procedure for HSCP Care at Home 2. iTrent The final stage of the payroll process involves inputting information into iTrent which is completed by Administration staff. There is currently no authorisation process in place to confirm the accuracy of information input into the system. The iTrent Project Team are currently looking at how the processing of timesheet data for staff can be improved to ensure accurate and timely information for payroll processing and more detailed information on when and why staff are working, particularly casual staff, for HR and service management. Provided by key officer for iTrent system to enable authorisation on system. 31/03/2026 31 May 2026 The Council are in the process of developing a new app, Pay Time, which, if implemented, will address this issue. The Council are suggesting that testing will begin in November 2025. It will be rolled out to the HSCP if the testing is successful. A precise implementation date is not within the control of the HSCP. It is suggested that this recommendation is next reviewed in 6 months, at which stage there should be a clear implementation date from the Council. Delayed and Rescheduled iTrent Project Team Page 33
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE CUSTOMER SUPPORT SERVICES 16 DECEMBER 2025 PERFORMANCE REPORTING UPDATE 1.0 EXECUTIVE SUMMARY The aim of this paper is to update the Audit and Scrutiny Committee with the progress on the review of the Council’s Performance and Improvement Framework (PIF) that is being undertaken as part of the Performance Excellence Project. The main overall deliverable from this project will be an updated PIF which includes a simplified, compliant and proportionate approach to performance and improvement activities. The report highlights work completed to date on activities in Phase Two of the project and plans for the outstanding work packages. It is recommended members note and consider the progress of the Performance Excellence Project and activities to conclude Phase Two. Page 35 Agenda Item 6
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE CUSTOMER SUPPORT SERVICES 16 DECEMBER 2025 PERFORMANCE REPORTING UPDATE 2.0 INTRODUCTION 2.1 The performance excellence project was commenced in May 2020 with the aim of reviewing the council’s approach to performance and improvement activities and simplifying them where possible. The report sets out the progress of Phase Two of the project and the planned activities to bring the remainder to a conclusion and deliver the updated Performance and Improvement Framework (PIF). 3.0 RECOMMENDATIONS 3.1 It is recommended members note and consider the progress of the Performance Excellence Project and activities to conclude Phase Two. 4.0 DETAIL 4.1 The initial performance excellence project commenced in May 2020 with a mandate to review the council’s performance management approach and implement a simplified, proportionate and compliant approach which meets the needs of a transforming council. Following a Best Value audit, the project included within its scope actions to improve performance reporting to provide a balanced picture of long term trends in performance against targets, and to use benchmarking information to drive continuous improvement. 4.2 The project then progressed to phase two with the overall objective to present an updated Performance and Improvement Framework which is in alignment with the Connect for Success Change Programme, further simplifies our approach to performance and improvement, while maximising the use of the technology available to us. Specifically, the project included five work streams which are largely based on the existing elements of the Performance and Improvement Framework. Progress on activities contained within each workstream is detailed below. 4.3 Workstream One: Planning This workstream focused on the design and development of plans that support delivery of the council’s strategic outcomes. As the Administration changed during the project, a new Corporate plan was developed which had not been Page 36
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in the original scope of the project. The pre-existing priorities were continued for the financial year 2024 – 2025 as the new Corporate Plan took effect within this period. This workstream focused on the following activities: - Review of corporate strategies and mapping of strategic outcomes – work on this continues. Sessions have taken place with senior leaders to agree rationalisation of strategies and a template for future and reviewed strategies. - Development of a team plan template to manage service standards aligned with strategic objectives – an initial pilot was undertaken by the HR and OD team using MS planner for non-core business, followed by further pilots in Catering and Cleaning and Education with overall positive feedback and most challenges coming from the behavioural shift in using the tool as opposed to the method. At Senior Leadership Forum in November 2024 the proposed approach using planner for non-core business activities was shared and a survey was issued seeking feedback. Strategic Management Team considered this and agreed that HROD should consider current use of MS Teams by Third Tier Managers and assess the potential challenges of transitioning to using Planner – this will be incorporated into ongoing work with Third Tier Managers. - Development of an updated Corporate Improvement Plan – this has been delivered. 4.4 Workstream Two: Review and Evaluation This workstream focused on the design and development of methods to review and evaluate performance at all levels. The aim of this work is to replace the scorecards that were previously in pyramid with a new approach that reduces manual input by collecting data at source wherever possible. This work took a themes AND teams approach, seeking to use the data platform to allow presentation of performance data in various formats for a variety of purposes and audiences. This workstream continues in regard to core business. Following a successful pilot, work is underway to implement reporting dashboards across the remaining teams, to be in place across the whole of the council service areas by 31 March 2026. 4.5 Workstream Three: Reflection This workstream focused on the learning that informs our plans for change and improvement. Other pieces of work took place on across the council, such as the review of our approach to Consultation and Engagement and our review of Service Design to embed the principles of Scottish Approach to Service design, which inform this project. Specifically within the scope of this work stream were • Self-assessment activities – a review of pilots was completed and templates are available for self-assessment in team and thematic approaches. • Annual Performance Review – a review of how we collect and reflect on annual performance at individual, team and organisational level took place and a revised approach to our Council Annual report is in Page 37
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development with options to be submitted to DMTs and SMT for views. Finalisation of this work package is dependent on agreement of Corporate Outcome Indicators. • Benchmarking – a review of our approach to the use of benchmarking including the Local Government Benchmarking Framework (LGBF) within our Performance and Improvement Framework. This work package has been delayed. Work is taking place with managers to explore their use of the LGBF. • Lessons learned – development of an approach that allows lessons learned to be shared widely across teams. This activity has been descoped from the project due to parallel work in regard to establishment of a Corporate Programme Office and will be incorporated into that. 4.6 Workstream 4: SPI Compliance / Public Performance Reporting This workstream focused on how we tell people about our performance in a way that is proportionate and meets the requirements set out in the Accounts Commission’s Statutory Performance Direction. The objective is for timely and meaningful public performance reporting and scrutiny. This workstream was completed in respect of the December 2024 statutory direction which covers the period up to and including 2027 – 2028. Additionally, work has taken place to review and update our website Performance pages which is in the process of going live. 4.7 Workstream 5: Updated Performance and Improvement Framework The final deliverable of the project will be an updated Performance and Improvement Framework which reflects the work carried out in each of the work streams above. This will incorporate all the resources currently available and in development. The updated PIF will be presented on conclusion of the other work packages. 4.8 Due to unanticipated delays as a result of dependencies relating to work requiring senior leadership involvement and direction, there is a need to extend specific elements of this project. It is anticipated that the outstanding work packages will be complete by the end of March 2026 and sooner in some cases. 5.0 CONCLUSION 5.1 In conclusion, this report outlines the progress made in regard to Phase Two of the Performance Excellence Project and arrangements to bring the outstanding work packages to a conclusion. Page 38
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6.0 IMPLICATIONS 6.1 Policy this project will deliver an updated Performance and Improvement Framework (PIF) for the Council. 6.2 Financial none arising directly from this report. 6.3 Legal the Council has a statutory duty to ensure Best Value and to comply with the Accounts Commission’s SPI directive. 6.4 HR none arising directly from this report. 6.5 Customer Service delivery of Best Value through our Performance and Improvement Framework ensures that our customers get value for money in the services that we provide them with. 6.6 Risk failure to deliver this project would result in the Council not having performance and improvement arrangements in place that satisfy the needs of a transforming Council. 6.7 Climate Change none arising directly from this report. 6.8 Fairer Scotland Duty none arising directly from this report - any Integrated Impact Assessments required will be completed as part of the project. 6.9 Equalities - protected none arising directly from this report - any Integrated Characteristics Impact Assessments required will be completed as part of the project. 6.10 Consumer Duty none arising directly from this report. 6.11 Island Communities none arising directly from this report - any Integrated Impact Assessments required will be completed as part of the project. 6.12 Children’s Rights and none arising directly from this report - any Integrated Wellbeing Impact Assessments required will be completed as part of the project. Kirsty Flanagan Executive Director with responsibility for Customer Support Services Policy Lead Councillor Mark Irvine 28 October 2025 Page 39
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For further information contact: Jane Fowler, Head of Customer Support Services, jane.fowler@argyll-bute.gov.uk Jennifer Coyle, Senior HR Business Partner, jennifer.coyle@argyll-bute.gov.uk Page 40
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ARGYLL AND BUTE COUNCIL AUDIT & SCRUTINY COMMITTEE CUSTOMER SUPPORT SERVICES 16 DECEMBER 2025 2024/25 COUNCIL ANNUAL REPORT 1.0 EXECUTIVE SUMMARY 1.1 This report presents to the Audit and Scrutiny Committee the 2024/25 Council Annual Report (CAR). 1.2 The Annual Report is one of the key ways we meet our Public Performance Reporting responsibilities, letting the people of Argyll and Bute know what we have delivered for our communities over the past year. 1.3 It provides an overview of our performance against corporate outcome indicators, along with insights from services on key activities, projects, achievements, and challenges during the reporting period. 1.4 Despite the challenges, there is much to celebrate. From delivering infrastructure projects to supporting local businesses and investing in our young people, we have achieved a great deal together. We have also responded to new national requirements, adapting our services and systems to meet evolving expectations and responsibilities. 1.5 The increasing impact of climate events continues to test our resilience, and we are responding with urgency and innovation. Whether through our climate adaptation work, investment in sustainable infrastructure, or support for community-led initiatives, we are committed to building a greener, more secure future. Page 41 Agenda Item 7
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ARGYLL AND BUTE COUNCIL AUDIT & SCRUTINY COMMITTEE CUSTOMER SUPPORT SERVICES 16 DECEMBER 2025 2024/25 COUNCIL ANNUAL REPORT 2.0 INTRODUCTION 2.1 This report presents to the Audit and Scrutiny Committee the 2024/25 Council Annual Report (CAR). 3.0 RECOMMENDATIONS 3.1 The Audit and Scrutiny Committee are asked to consider the content of the Council Annual Report. 4.0 DETAIL 4.1 The Council Annual Report is a key document for the Council’s statutory Public Performance Reporting (PPR) duties and is published on the council website. It was agreed at Council on 24 September 2025. 4.2 It presents both our performance against our corporate outcome indicators (COI) and information on the key activities, successes and challenges that our services have faced during 2024/25. 4.3 The Council Annual Report pulls together many examples of the exceptional efforts, innovative solutions delivered by our staff and joined up working between the Council and our partners and communities that took place during this period. 4.4 Despite the challenges, there is much to celebrate. From delivering infrastructure projects to supporting local businesses and investing in our young people, we have achieved a great deal together. We have also responded to new national requirements, adapting our services and systems to meet evolving expectations and responsibilities. 4.5 The increasing impact of climate events continues to test our resilience, and we are responding with urgency and innovation. Whether through our climate adaptation work, investment in sustainable infrastructure, or support for community-led initiatives, we are committed to building a greener, more secure future. Page 42
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5.0 CONCLUSION 5.1 The Annual Report is one of the key ways that the Council meets our Public Performance Reporting responsibilities, letting the people of Argyll and Bute know what we have delivered for our communities over the past year. Once approved, it is published on the Council website. 6.0 IMPLICATIONS 6.1 Policy All of the indicators in this report are based on agreed Council policy. 6.2 Financial All indicators with financial implications are actively managed through agreed budget monitoring processes. 6.3 Legal All appropriate legal implications are complied with. 6.4 HR All HR implications are actively managed through agreed Wellbeing and Management monitoring processes. 6.5 Customer Service All activities with customer feedback or insight are rigorously monitored for improvement. 6.6 Risk Without this information Elected Members are less informed of activities within their area. 6.7 Climate Change The Council is committed to working towards net zero. 6.8 Fairer Scotland Duty None arising directly from this report. An IIA is not required for performance reporting. 6.9 Equalities – protected None arising directly from this report. All activities characteristics monitored in this report comply with the council’s equality policies and obligations. An IIA is not required for performance reporting. 6.10 Consumer duty None arising directly from this report. An IIA is not required for performance reporting. 6.11 Islands Communities None arising directly from this report. An IIA is not required for performance reporting. Page 43
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6.12 Children’s Rights and None arising directly from this report. An IIA is not Wellbeing required for performance reporting. This report highlights examples of how the Council is committed to and working towards reducing child poverty and improving outcomes for every child Pippa Milne, Chief Executive Jim Lynch, Council Leader November 2025 For further information contact: Jane Fowler, Head of Customer Support Services, jane.fowler@argyll-bute.gov.uk Kay Owen, Team Lead - OD Project Office, kay.owen@argyll-bute.gov.uk APPENDICES Appendix 1: Council Annual Report 2024-25 Page 44
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1 Council Annual Report 2024 - 2025 Page 45
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1 Contents Forewords ................................................................................................................................................................................................... 4 Leader of the Council .......................................................................................................................................................................................... 4 Chief Executive ................................................................................................................................................................................................... 5 Introduction ............................................................................................................................................................................................... 6 Financial statement ........................................................................................................................................................................................... 7 Council priorities ......................................................................................................................................................................................... 8 Communities ....................................................................................................................................................................................................... 8 Children and young people.................................................................................................................................................................................. 8 Environment ........................................................................................................................................................................................................ 8 Speaking up for Argyll and Bute .......................................................................................................................................................................... 8 Sustainable service delivery ................................................................................................................................................................................ 8 Transport, infrastructure and digital connectivity ................................................................................................................................................. 8 Housing, economic growth and population .......................................................................................................................................................... 9 Cross-cutting activities ................................................................................................................................................................................ 9 Connect for Success ........................................................................................................................................................................................................ 9 Our Workspace – reducing costs and increasing efficiencies ........................................................................................................................................ 10 Performance Excellence Project .................................................................................................................................................................................... 10 ICT and Digital ............................................................................................................................................................................................................... 11 Climate Change ........................................................................................................................................................................................ 12 Capital Investment and central repairs delivered ...................................................................................................................................... 13 Housing and the Housing Emergency ....................................................................................................................................................... 13 Our performance ....................................................................................................................................................................................... 15 How We Compare – Local Government Benchmarking Framework (LGBF) ................................................................................................................ 16 Page 46
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2 Delivering our outcomes ........................................................................................................................................................................... 18 Corporate Outcome: People live active, healthier and independent lives ................................................................................................. 18 Corporate Outcome: People will live in safer and stronger communities .................................................................................................. 21 Supporting our communities .............................................................................................................................................................................. 22 Corporate Outcome: Children and young people have the best possible start ......................................................................................... 24 Support and interventions for our care experienced children and young people ........................................................................................................... 26 Addressing non-attendance ............................................................................................................................................................................... 26 UNICEF UK’s Rights Respecting School Programme ....................................................................................................................................... 26 Children living in Poverty ................................................................................................................................................................................... 26 Award winning school meals service ................................................................................................................................................................. 28 School Counselling Service ............................................................................................................................................................................... 28 School suitability ratings .................................................................................................................................................................................... 28 Corporate Outcome: Education, skills and training will maximise opportunities for all .............................................................................. 29 Developing the young workforce .................................................................................................................................................................................... 31 Helping People into work ............................................................................................................................................................................................... 31 Literacy and Numeracy ..................................................................................................................................................................................... 32 Play on Pedals .................................................................................................................................................................................................. 32 Attainment ......................................................................................................................................................................................................... 32 Corporate Outcome: Our economy is diverse and thriving ....................................................................................................................... 34 Supporting economic recovery and our communities .................................................................................................................................................... 37 The Rural Growth Deal (RGD) ....................................................................................................................................................................................... 40 One council: property income ............................................................................................................................................................................ 43 Housing Services Partnership with Home Argyll ............................................................................................................................................... 43 Corporate Outcome: We have an infrastructure that supports sustainable growth ................................................................................... 44 Council Carbon Footprint .................................................................................................................................................................................. 45 Page 47
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3 Flood Protection ................................................................................................................................................................................................ 46 Marine infrastructure ......................................................................................................................................................................................... 46 Ferry services .................................................................................................................................................................................................... 48 Road Condition improvements .......................................................................................................................................................................... 51 Corporate Outcome: Getting it right .......................................................................................................................................................... 54 Increasing the use of our website and self-service tools ................................................................................................................................................ 55 Improving our customer service ..................................................................................................................................................................................... 56 Award Recognition for Outstanding Innovation and Service .............................................................................................................................. 56 Supporting our Community Councils ............................................................................................................................................................................. 57 Local Government elections and supporting new elected councillors ............................................................................................................................ 57 Committee Support and Member Services ........................................................................................................................................................ 58 Looking after our financial assets ..................................................................................................................................................................... 59 Supporting attendance ...................................................................................................................................................................................... 59 Supporting Our People: Insights and Wellbeing Initiatives ................................................................................................................................ 60 Strategic Risk Register ............................................................................................................................................................................. 60 Operational Risk Register ......................................................................................................................................................................... 61 Service delivery challenges....................................................................................................................................................................... 61 Consultations – we asked, you said, we did ............................................................................................................................................. 64 Page 48
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4 Forewords Leader of the Council It is a privilege to introduce Argyll and Bute Council’s Annual Report for 2024-25. Within this document you will find many examples of the achievements and successes that this council has delivered for its communities in the past year. The past year has also seen the council going through some changes, with a different Administration in place from April 2024. With this has come a refreshed and renewed set of strategic Priorities for the remainder of the council term up to 2027, and these underpin the council’s decision-making, its work and the action it takes. Our updated Priorities set out our aspirations for the area and our determination to see it thrive. They must, though, also frame how we tackle challenges, and something that remains a constant for every Scottish local authority is the financial climate in which we must operate and deliver for our communities today while seeking to plan ahead for tomorrow. Sometimes meeting those challenges requires making equally challenging decisions. While easy solutions or quick fixes almost never come along, something that can help in that context of challenge is to work in partnership – whether with other agencies or with our communities. That is why engagement is a key element of our Priorities, harnessing the knowledge and the commitment of our incredible communities where there is an increasing understanding that councils can no longer do all that they used to do or all that they would like to do, and that different approaches are required in today’s climate. Now, more than ever before, it is vital to work together where we possibly can. We may well have differing views from time to time, but we also have much common ground to be found and there are issues on which we can not only collaborate but where we can join our voices together to speak up and stand up for Argyll and Bute. I opened by saying it is a privilege to open this report. I close by saying that is an even greater privilege to represent this area, its people and its communities. Local government in Scotland continues to cope with change and to look towards transformation. Here in Argyll and Bute we are embracing that head-on and seeking to get ahead of the game, using the knowledge and experience we’ve had to build up in order to successfully deliver services and investment across one of Scotland’s most unique geographic environments. That, coupled with the determination of our workforce and the tremendous community spirit and resilience for which Argyll and Bute is renowned, stand us in good stead for as bright a future as possible. Cllr Jim Lynch Leader, Argyll and Bute Council Page 49
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5 Chief Executive Welcome to Argyll and Bute Council’s Annual Report for 2024–25. This report provides an overview of the work we’ve undertaken over the past year, the progress we’ve made, and the challenges we continue to face. It reflects our commitment to transparency, accountability, and to delivering the best possible outcomes for our communities. As we reflect on the past year and look ahead to 2025–26, I want to begin by recognising the continued dedication and resilience of our staff, who remain at the heart of everything we do. Their commitment has enabled us to deliver vital services in the face of ongoing challenges and change. This year, we have had to make some difficult decisions about the future of service provision. These decisions are never taken lightly, and they reflect the complex financial landscape we continue to navigate. However, they are also part of our commitment to ensuring that we can sustain essential services for the people of Argyll and Bute in the years to come. We know that the best decisions are made together. That’s why we have continued to engage with communities across the area, listening to what matters most to them and working in partnership to shape the future. This collaborative approach is central to our vision for a stronger, more resilient and thriving Argyll and Bute. Despite the challenges, there is much to celebrate. From delivering key infrastructure projects to supporting local businesses and investing in our young people, we have achieved a great deal together. We have also responded to new national requirements, adapting our services and systems to meet evolving expectations and responsibilities. The increasing impact of climate events continues to test our resilience, and we are responding with urgency and innovation. Whether through our climate adaptation work, investment in sustainable infrastructure, or support for community-led initiatives, we are committed to building a greener, more secure future. Looking ahead, we remain focused on tackling the challenges that lie before us. We will continue to work with our communities, partners, and staff to find solutions, embrace opportunities, and deliver for Argyll and Bute. Together, we can shape a future that reflects the strengths, aspirations, and potential of this remarkable area. Pippa Milne Chief Executive, Argyll, and Bute Council Page 50
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6 Introduction Welcome to our annual report. This report is an opportunity to share with you how your council has performed over the past year and is part of our public performance reporting commitment. Argyll and Bute Council’s vision and strategic direction is set in our Corporate Plan. Central to our corporate plan and highlighted throughout this report is successful partnership working with our partners, stakeholders, and local communities. In 24/25 the corporate plan set out three key priorities to fulfil our vision of a prosperous, inclusive, and sustainable Argyll and Bute. People and Places: our core business as a council Potential and Growth: turning opportunities into reality Partnership and Action: everyone has a part to play in Argyll and Bute’s success Our performance on these priorities over the past year was monitored via seven high-level Corporate Outcomes and a series of 47 Corporate Outcome Indicators (COIs). These indicators are strategic in nature and are reported annually to the Audit and Scrutiny Committee and Full Council. Detail on our performance against these Corporate Outcome Indicators as well as further information on our key activities and areas of focus and successes and challenges are provided within this report. Page 51
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7 Financial statement In 2024/25 the budget gap was £10.167m prior to any measures to balance the budget and projected to rise to over £55m over a five-year period, with decisions made to bridge the 2024/25 gap, reduce future year pressures, and protect vital services. When agreeing the 2024/25 budget, the Council committed to provide funding for additional leisure, tourism, regeneration, and other initiatives totalling £0.248m which included funding for the following organisations: £0.010m for the International Eight Metre Association World Cup. £0.075m for the Argyll and the Isles Tourism Co-operative. £0.075m for the Culture, Heritage, and Arts Assembly (CHARTS). £0.028m for the Screen Machine mobile cinema. £0.030m for the Mid Argyll Community Pool in Lochgilphead. £0.030m for the MacTaggart Leisure Centre on Islay. Over the course of 2024/25 almost £549,134 in Scottish Welfare Fund grants were paid to support vulnerable people and £968,036 of Discretionary Housing Payments were distributed to households in need. During the year, the Council also continued to pay grants to cover food and fuel for people in poverty and successfully referred them for support to advice agencies; this resulted in maximised benefit income and reduced fuel costs of over £109,920 by the end of the 2024/25 Page 52
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8 Council priorities In 2024 the council administration announced our priorities for 2024-2027. Our aim is clear: Argyll and Bute’s economy and population need to grow, and our seven interconnected priorities contribute to that. The themes that underpin these priorities and the actions to deliver these can be found on our website: Priorities of Argyll and Bute Council | Argyll and Bute Council Communities Our communities are as diverse as our geography and have varying needs, challenges, and opportunities. We want to harness local knowledge and work together to develop shared priorities. Children and young people Giving young people the best start in life and ensuring we have the right skills for a prosperous future, are key elements of making Argyll and Bute an ideal choice for families to stay or to relocate. Environment The Council has already declared a climate emergency continues to keep this a primary consideration. Recognising the importance of climate change is a key factor when we consider how we do business. We are committed to achieving 75% carbon reduction by 2030 and net zero before 2045. Speaking up for Argyll and Bute Collective, as well as collaborative, action is necessary to deliver growth on the scale that Argyll and Bute needs. No single agency alone can deliver on Argyll and Bute’s overarching aim of significant, vital population and economic growth. Sustainable service delivery We want to provide the best services we can for the money and resources available – and make clear the standards that our communities can expect. We know that this is important to local people. Transport, infrastructure and digital connectivity Argyll and Bute’s mix of rural and island communities mean that transport, infrastructure, and digital connectivity are crucial in the drive for growth. We need effective and reliable ways to bring people, goods and services to Argyll and Bute – and to carry our own products. Reliable, resilient digital Page 53
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9 links have a highly significant contribution to make to growing the population and the economy. They can add considerable value to Argyll and Bute’s position as an ideal choice to locate to. Housing, economic growth and population Access to housing is a factor in almost every aspect of Argyll and Bute’s crucial growth agenda. It contributes to the success of economic development, recruitment, employment opportunities, service delivery and much more. Population growth is crucial to our economic success as decline impacts on our ability to sustain and deliver services in the future. We value the impact and return on investment that effective, targeted economic development can have. Cross-cutting activities Connect for Success This initiative is dedicated to encouraging and recognising new ways of working across the Council, to make things better for everyone. We are looking to the future and are focused on advancing how we use technology, share resources, and collaborate because better for us is better for our communities. There are 7 key areas, or principles, that we are focused on developing in how we work: 1. One Council One Place 2. Purpose and Mission Focus 3. Employee Empowerment 4. Data and Evidence Driven 5. Learning Council 6. Agile Mindset 7. Maximise Useful Technology Across the council these principles are in action and people are working on new projects and in new ways to help make things better. For example, we have reduced bureaucracy and saved time and effort by implementing a project to streamline our internal human resources systems and speed up the recruitment process. Connect for Success is about bringing the 7 principles to life by sharing ideas and looking for new ways to innovate to help us do our jobs and deliver services. Page 54
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10 Partnership working As part of our Connect for Success principles we continue to work with colleagues across all teams and services, and where appropriate external partners and stakeholders to achieve a common goal. This approach to partnership working assists in improving efficiencies and removing work barriers, fully utilising what we have, connecting staff through technology, connecting services in delivering change and services, while connecting with communities and working together to improve outcomes for Argyll and Bute. Our Modern Workspace – reducing costs and increasing efficiencies The Our Modern Workspace project is reviewing how we use our workspace, reduce costs, and increase efficiency. Six hub buildings are now complete and under-utilised buildings under review for repurpose or to be mothballed. The entire project is being delivered through existing capital programme budgets and Scottish Government Place Demonstrator Funding (£664K awarded to deliver Rothesay Project). Our largest Office footprint is in Lochgilphead, and a project has been ongoing throughout 2024 and 2025 to create a new vision for the Council headquarters at Kilmory Castle by creating a modern public sector and democratic hub. The aim is to create a better and more sustainable place to collaborate and do business. We have been working with other public sector agencies, and an implementation plan is evolving to take the project into development in 2025/26. The Project has delivered significant savings from rationalising shared offices through: • Non-Domestic Rates relief on the buildings that have been closed. • A reduction in utility consumption. • A reduction in cleaning costs. • A reduction in the number of printing devices required. • A reduction in paper and the need to print as we adopt a more digital approach to service delivery. • A reduction in annual ICT network charges, such as ISDN lines and broadband charges. • Reduced ongoing cost pressures for replacement of network equipment (Wi-Fi access points / server switches etc.), where possible network equipment has been utilised in other locations. These savings and ease on cost pressures will continue to grow as the Our Modern Workplace project continues to deliver town by town. Performance Excellence Project We are continuing to improve the way that we measure and report on our performance as a Council, in line with Connect for Success. We aim to make it clearer for Councillors to scrutinise our service performance and easier for the public to see what we deliver. Page 55
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11 This year we have begun to align our strategies and plans with the new council priorities and are making full use of the technology available to us through M365. We are designing new planners and dashboards to best show the data we hold, which will support review and evaluation of our performance so that we can ensure continuous improvement. We are designing this with a pilot group of team managers. Microsoft365 With Education colleagues now being introduced to Microsoft 365 (M365) and Teams, the move to using Teams for Telephony for all staff will be completed well before the retirement of Skype for Business in October 2025. The continued development of existing and new apps has added many more options for staff in how they use M365, and they are now also supported by having access to a nationally resourced M365 Skills Hub. The Digital Champions programme is being reviewed and refreshed to ensure the most is made of our investment in M365 and that staff have the support they need from within their own services. The opportunities that MS Copilot presents will be evaluated in a pilot of 100 staff prior to decisions being taken on the significant additional investment that a rollout to even a proportion of staff would represent. It’s anticipated Copilot will further enhance the benefits to staff and customers of using M365 in their daily work. ICT and Digital The Council’s ICT and Digital Strategy aims to position Argyll and Bute Council as a “digital by default” authority. The strategy resulted in the development of an action plan containing almost 100 activities designed to lead to further efficiencies, savings, and improved services for Council staff and customers. We outlined a vision to provide digital technologies and processes to support our people and our customers, to encourage collaboration, get things done and contribute to a better organised and more efficient council. The Accounts Commission’s April 2025 report on Best Value in Argyll and Bute Council found that “Given its remote and rural characteristics, the council is ahead of the game in terms of achieving efficiencies, including through its use of digital technology, with exciting examples of innovation within service areas.” This improved position hasn’t happened by chance. Our ICT and Digital Strategy over the last 4 years has focused on delivering key outcomes for our customers, simplifying, and improving our processes, providing secure and fit for purpose technology solutions and creating an agile culture for our workforce. New ways of working with ICT and Data Data is at the heart of key decision-making and improving outcomes for Argyll and Bute’s residents and communities. Our new Data Platform is now live, and the Data Advisory Group and the data team are dealing with a variety of exciting new data challenges. Examples of data challenges in 2024/25: Page 56
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12 • The Climate Change Officer produces reports to both the Scottish Government (against national targets for 2030 and 2045) and quarterly reports to the Climate Change board. These reports require extensive data collection, analysis, and projection modelling. Using new data models, the council’s Climate Change Board can now visualise the challenge of meeting the Scottish Government’s statutory emissions goals. It is also now possible to perform fairly complex scenario planning to consider different strategies for reaching these goals, and aiming to reach them sooner, based on a better understanding of the potential long-term impact of working to reduce specific carbon emission sources more quickly. • As part of our aim to bring as many empty business properties back into use as possible, we used our PowerBI reporting tool to extract and analyse Non-Domestic Rates (NDR) data. This gave us information on rates of business change, business types, rateable values etc which the Empty Business Property Officer can use to target actions to for businesses, seek inward investment or coordinate other interventions such as a change of use for a property to make it more attractive to business in the local area. Climate Change The Council continues to meet its statutory duty to report on emissions and climate action through the annual Public Bodies Climate Change Duties Report, with strategic oversight provided by the Climate Change Board. We are developing a comprehensive Net Zero Route Map to provide a detailed pathway for Council operations to achieve net zero emissions by 2045. Operational Achievements Significant progress is being made across the organisation through investments in building energy efficiency, renewable energy generation, and fleet decarbonisation. Independent analysis confirms the Council successfully managed its energy use to outperform national benchmarks during a year of unprecedented electricity grid challenges. A major milestone was reached in October 2024 with the completion of an 86kW roof-mounted solar PV system at Cardross Primary School, representing the culmination of the Non-Domestic Energy Efficiency Framework (NDEEF) programme. The system joins the Council's expanding renewable energy portfolio, which now includes 27 solar PV installations across the area with a combined capacity of over 1.3MWp. Another significant achievement was the innovative stabilisation of the Grade A-listed Burnet Building in Campbeltown. The Council implemented a cutting-edge geopolymer resin injection solution involving 250 injection points reaching depths of two metres beneath the building structure. This non-invasive method allowed the building to remain operational throughout the works and delivered approximately 78% lower carbon emissions compared to traditional concrete underpinning - an estimated carbon saving of 50.7 tonnes. The Council's LED streetlight replacement programme has achieved remarkable results, with over 14,000 luminaires replaced. Annual CO₂ emissions have dropped from 3,140 tonnes in 2015/16 to a projected 264 tonnes for the full 2024/25 financial year (based on performance to September 2024) – a reduction of 92%. Page 57
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13 Partnership and Community Leadership The Community Planning Partnership has made substantial progress in developing the Argyll and Bute Climate Action Strategy, funded by CPP partners including Argyll and Bute Council, with the project lead hosted by Argyll Countryside Trust. This comprehensive strategy represents a region-wide, community-led approach to achieving net-zero and climate resilience, developed through extensive engagement with communities and stakeholders across Argyll and Bute. The strategy establishes the vision that "We make Argyll and Bute climate ready by acting together to understand and adapt to our changing climate". Carbon Neutral Islands Programme Argyll and Bute Council supports the Scottish Government's Carbon Neutral Islands (CNI) Programme through the Local Authority Advisory Group and accessing the Carbon Neutral Islands Capital Fund. Highlights for 2024/25 are: Governance and Alignment –Membership of the Local Authority Advisory Group ensures island plans mesh with wider council and national policy and that good practice is shared with mainland communities. Strategic Foundations – Community Climate Action Plans are in place for Islay, Great Cumbrae, Hoy, Raasay, and Yell. Comprehensive carbon audits have established baseline emissions for each island. Investment and Delivery – Tailored climate-change investment strategies have been completed to guide project selection and funding bids. £1 million of capital funding allocated for 2024/25 to kick-start priority net-zero projects. For Islay this is supporting the installation of solar PV and battery technology across 7 community buildings as well as supporting the Islay Forestry Initiative through the purchase of equipment for wood fuel processing and creation of a community orchard. Overall, the programme has moved from planning to implementation, giving every island a clear emissions baseline, an agreed action plan and the first tranche of capital to put projects on the ground—all aimed at achieving carbon neutrality by 2040, five years ahead of Scotland's national target. Capital Investment and central repairs delivered We have successfully delivered a programme of investment in our property assets totalling £10.5M. Included within the wide variety of investment projects were 53 projects relating to energy efficiency, reducing fossil fuel consumption and renewable energy generation. This included solar panels, air source heat pumps and new automated control systems in our buildings, mainly in our schools. As well as delivering the additional investment projects, emergency, planned and statutory maintenance programmes were successfully delivered, resulting in improved customer satisfaction. Additionally, a separate large-scale project reviewed the water, wastewater, and drainage charges for the Council. This project has delivered one-off refunds in the region of £570,000 and year-on-year savings of more than £160,000 per annum. Housing and the Housing Emergency In June 2023 the Council’s Environment, Development and Infrastructure (EDI) Committee declared a Housing Emergency due to a persistent reduction in the supply of housing, a steady increase in demand for housing across all tenures and increasing levels of un-affordability. In November 2024, Members of the Scottish Government, Local Government, Housing and Planning Committee, visited Oban. They met with the Council’s leader Jim Lynch, CEO Pippa Milne, other senior council officials, and representatives from the Link Housing Group together with a Page 58
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14 representative from the Colonsay Community Development Company. The day also included a visit to the Dunbeg Corridor housing development. The Scottish Government has produced a report of the visit which can be accessed here: A report on Committee visit to Argyll & Bute Council, 25th November 2024 In January 2025 consultants were engaged, to develop the Strategic Development Framework for Oban (OSDF) and Helensburgh (HSDF). Both are intended to identify long-term 20-40 years strategic development opportunities. The Council has continued to develop Business Cases for the proposals for a worker accommodation pilot on Mull, and market housing for principal home occupation on Islay. In addition to the £3m Rural Growth Deal investment allocated to these projects, further funding is being sought to enable housing projects. The Council has employed local contractors and is working with Mull and Iona Community Trust to deliver worker housing in Tobermory. Work is underway to procure tender costs for construction of the worker housing which will provide 12 units. It is anticipated a site start for building construction in spring 2026. A Local Heat and Energy Efficiency Strategy (LHEES) was approved by Council in November. This sets out a policy framework that assists in reducing fuel poverty in the long term. Officers will now work to identify deliverable projects and use the LHEES to support funding applications. The Home Energy Efficiency Programme Scotland (HEEPS) allows homeowners and private rented tenants to reduce their energy bills, assists with the cost-of-living crisis, and reduces energy consumption contributing to a reduction in climate change The Council fully utilised HEEPS funding of £1,979,827 for 24/25. Our Empty Homes Officer project, working with the HSCP solely to assist empty homes owners to bring back properties in to use for HSCP staff has received national recognition through an award from the Empty Homes Network. This project is directly supporting the retention and recruitment of the key workforce required to sustain essential services and making the best use of existing stock. The role has directly enabled homes and bed spaces for use by HSCP workers in Coll, Connel, Tiree & Islay.” Page 59
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15 Our performance This table presents our progress in delivering the seven Corporate Outcomes outlined in the previous Corporate Plan (2022–2027). It is followed by detailed performance data and supporting commentary for each Corporate Outcome Indicator." Overall performance of our Corporate Outcome Indicators Corporate Outcome Number of Indicators Number On Track / Above Target with Improving Performance Number Off Track / Under Target / No Data No Target People live active, healthier, and independent lives 6 3 3 0 People will live in safer and stronger communities 4 3 0 1 Children and young people have the best possible start 8 5 2 1 Education, skills, and training maximise opportunities for all 7 1 3 3 Our economy is diverse and thriving 12 0 2 10 We have an infrastructure that supports sustainable growth 5 3 0 2 Getting it right 5 2 0 3 TOTAL 47 17 10 20 We continue to report other indicators of importance on a quarterly basis at each of our Area Committees. Quarterly Area Performance Reports present a suite of indicators at a local, area level with complementary narrative, and, where possible, Council-wide performance is also presented alongside these indicators. These can be found in the Performance and Improvement section of the Council website. Performance and Improvement | Argyll and Bute Council (argyll-bute.gov.uk) Page 60
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16 How We Compare – Local Government Benchmarking Framework (LGBF) In addition to monitoring our corporate outcomes we use a variety of improvement tools. A key aspect of this relates to our engagement with the Local Government Benchmarking Framework (LGBF). All local authorities in Scotland participate in the Local Government Benchmarking Framework (LGBF). The data is collected and presented in ways to ensure consistency and enabling comparisons between councils to be made, as levels of performance are affected by differences in local circumstances and local priorities. Data for the most recent year will not be complete until after the full twelve months has passed. The majority of the 2024/25 data will be published by the end of 2025. The chart below shows how our performance compares relative to other Scottish local authorities; overall, our performance has improved. In the last year, 60% of indicators for Argyll and Bute were in quartiles 1 and 2, where performance is above the Scottish average. This compares to 46% of indicators falling in quartiles 1 and 2 in the previous year. Between 2022/23 and 2023/24, 23 indicators (out of 99 for which direct comparisons could be made) moved to a higher quartile, 65 indicators stayed within the same quartile, and 11 moved to a lower quartile. Page 61
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18 Delivering our outcomes Below we provide detail on our performance against each of our Corporate Outcome Indicators and further context on the activities that have taken place to support delivery in that area. Corporate Outcome: People live active, healthier, and independent lives Number of indicators: 6 Number on track: 3 Number no target / no data: 3 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Maximise distribution of Scottish Welfare Fund 95.30% 120.70% 144.00% 128.56% 119.80% G The Scottish Welfare Fund provides vital support to vulnerable households across our community. During 2024/25 a total of 1,134 households were supported, enabling individuals to remain safely in their communities and avoid crisis situations. We have maintained a high standard of delivery and responsiveness. Percentage of clients satisfied that they are better able to deal with their financial problems following our support and intervention 90.00% 100.00% 100.00% 100.00% 97.00% G Following their interaction with advice services, clients are invited to participate in a customer satisfaction survey. In the 2024/25 reporting period, 97% of respondents indicated that they felt better equipped to address the financial challenges they were facing. Maximise distribution of Discretionary Housing Payment (DHP) fund 96.00% 98.20% 79.00% 84.30% 89.20% R The Discretionary Housing Payment (DHP) fund continued to serve as a vital mechanism for supporting low-income households facing housing related financial hardship. Although our actual expenditure fell short of the 96% target, a total of 729 households were successfully assisted in sustaining their tenancies and avoided housing instability. Page 63
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19 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Percentage of care services graded as 'good' (4) or better in Care Inspectorate inspections 75.0% 80.00% 79.50% 77.30% 84.20% G The percentage achieved is also above the reported Scotland Rate (81.9%). Next years target will be uplifted to 80%. Percentage of adults receiving any care of support who rated it as excellent or good 75.30% 68.60% 68.60% 74.00% 74.00% - Data available biannually, next survey data available 2025/26 Percentage of carers who feel supported to continue in their caring role 29.70% 38.00% 38.00% 38.00% 38.00% - Data available biannually, next survey data available 2025/26 Helping people live active, healthier, and independent lives We have helped residents maximise their income through additional benefits or accessing grants. This work has supported vulnerable people with assistance with independent living, preventing homelessness and helping reduce the number of households and families living in all types of poverty, including extreme poverty. • A total of £549,134 in Scottish Welfare Fund grants was paid to support 1,134 vulnerable households in our communities who are in need of financial support. This made up of Scottish Government programme funding and funding by Argyll and Bute Council. • Discretionary Housing Payments totalling £968,036 were distributed to 729 households in need to prevent homelessness and assist vulnerable members of our communities to maintain their tenancies. As a result of new guidance issued from Scottish Government, the Council’s policy will be reviewed to maximise further use of the fund in future years. • We paid out £109,920 in grants to cover food and fuel for people in poverty and successfully referred them for support to advice agencies. Page 64
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20 • 965 families have been supported to maximise benefit income and reduced fuel costs to the value of £1.357m. • The average processing time for new housing benefit claims was 14.67 days and 3.35 days for changes in circumstances against targets of 21 days and 6 days, respectively. • We assisted residents to claim £5.4 million in additional benefits that may have otherwise remained unclaimed, assisting independent living and preventing homelessness. This figure included £821,127 for individuals and families affected by cancer and supported through partnership with Macmillan Cancer Support and the Welfare Advice and Health Partnership. • The Welfare Rights Advice in Health Partnerships Initiative and referral pathway has built on existing links with GP practices and has made a positive difference to these rural and island communities. Financial gain for 2024-25 for clients referred via this pathway was £418,453. • 98% of respondents in our welfare rights customer satisfaction survey would recommend the service. 95% rated their overall experience of using the service as excellent or good and 96% said the time taken to respond to their initial enquiry was excellent or good. • In line with Scottish Government Policy, we implemented an uplift in the basic pay of carers and personal assistants who look after adults in our communities and Early Learning and Childcare workers employed by Partner Providers to ensure payment of at least the Scottish Living Wage. Page 65
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21 Corporate Outcome: People will live in safer and stronger communities Number of indicators: 4 Number on track: 3 Number no target / no data: 1 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Percentage of groups who say their effectiveness has increased as a result of capacity building by the community development team 75.00% 100.00% 90.00% 100.00% 100.00% G The results are from an annual survey of customers and community groups engaged with the Community Planning and Community Development Team. Information provided to our community groups, individuals and partners is easy to understand 75.00% 96.00% 90.00% 93.00% 93.00% G We recognise the importance of ensuring accessible communication when engaging with community groups. Total value of compensation settlements for vehicle damage/driver injury as a result of road/bridge faults No target £2,807 £1,879 £1,956 £2,147 No target Initial claims are recorded by our Roads team using Oracle system, with a supplementary record maintained in the designated directory on the shared network. Percentage of adult residents stating their neighbourhood as a 'very good' place to live 70.00% - 69.00% No data 74.00% G The figure for 2022 was 69% so the new figure of 74% is a significant improvement. Page 66
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22 Supporting our communities In 2024/25, funding from the Supporting Communities Fund (SCF) was awarded to 64 groups across Argyll & Bute for the delivery of projects spanning sport, transport, music, the arts, and environmental initiatives. Walking and Cycling in the Dark The Community Development Team successfully secured funding through the Shaping Places for Wellbeing Programme to support active travel initiatives in Dunoon. Darkness was identified as a key barrier preventing children and families from choosing active travel over motorised transport. In response, five reflective and glow-in-the-dark craft workshops were delivered in local schools to promote safe travel during darker hours. A public workshop was held at Dunoon Pier on Saturday, 5th October, coinciding with the launch of the Dunoon Bothy. The event attracted over 83 attendees, who shared valuable feedback on what would encourage them to walk and cycle more. These insights were shared with the Active Travel Team. The project was delivered in partnership with Community Police, Cycling UK, and the Dunoon Development Trust. Following the workshops, 70% of pupils reported they would be more likely to walk or cycle in the dark. Feedback from children, staff, and parents was overwhelmingly positive. The activities were inclusive, accessible to all ages and abilities, and fully adapted for pupils with complex needs. Oban Community Council – Local Place Plan & Flood Resilience Ongoing engagement with Oban Community Council has focused on their Local Place Plan (LPP) and the work of their Flood Resilience Subgroup. A joint meeting was facilitated between Oban Community Council and an internal colleague involved in the Oban Strategic Development Plan, to explore opportunities for collaboration and ensure alignment of efforts, helping to avoid duplication. Page 67
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23 Victory Hall, Benderloch – Community Engagement Project Victory Hall successfully secured SCF funding to support a local community engagement initiative. A meeting was held with the group to discuss the scope and aims of their project and guidance was provided using the VOICE Community Engagement Toolkit to help align their approach with the National Standards for Community Engagement. Good practice for engaging with children and young people was also discussed and ongoing support is being provided as the project progresses. Ardrishaig Community Council – Local Place Plan development Following attendance at a community-led plans training session in December 2023, Ardrishaig Community Council progressed their intention to develop a Local Place Plan (LPP). They were advised to establish a steering group and a facilitated workshop once the group was in place. The group was signposted to relevant funding opportunities, including the Community Led Local Development Fund and Awards for All and agreed to focus on person-to-person engagement, recognising their own skills and capacity to lead the process. The group developed ideas for community outreach and proposed forming a diverse working group of residents, with clear lines of accountability through designated representatives. Page 68
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24 Corporate Outcome: Children and young people have the best possible start Number of indicators: 8 Number on track: 5 Number no target / no data: 3 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Provide quality meals within cost margins to all pupils +/-5.00% -0.04% -2.56% 0.48% -1.73% G Delivered 1.2m early years, primary and secondary school meals. Increase the percentage of our care experienced young people that have the recommended additional tracking and monitoring plans in place 100.00% 100.00% 100.00% 100.00% 100.00% G Each care experienced child and young person (CECYP) enrolled in an authority school has tracking and monitoring in place via our education management system. Data collected includes attendance, exclusions, progress and attainment and wellbeing information. The Virtual School adds an additional layer of scrutiny to this process through a series of attainment meets and partnership working, helping to ensure our CECYP have the supports required. We continue to work with partner agencies and other local authorities to support our CECYP hosted out with Argyll and Bute Percentage of children living in poverty (after housing costs) No target 21.7% 23.5% No data No data No target Data collated by End Child Poverty, 2024/25 data not yet published. Last data available 2022/23. Page 69
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25 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Percentage rate for attendance across all Argyll and Bute schools is comparable or better than the Scottish national average (biennial data) 92.00% 93.30% 90.55% 92.85% 90.80% R Maximising attendance remains a key strategic priority, with ongoing liaison with Education Scotland colleagues to ensure alignment between local policy and national recommendations. Support the increase in the update of available grants, allowance, and entitlements 2,573 2,853 2,999 3,125 3,750 G The implementation of online grant processing has enabled staff to exceed targets. A counselling service is available in all secondary schools 100.00% 100.00% 100.00% 100.00% 100.00% G The service has supported 472 young people in secondary schools and 216 children in primary schools. The most common reasons for referral include anxiety, low mood, family difficulties, and emotional regulation. 83% of young people and 81% of primary-aged children completing support reported positive clinical outcomes, including reduced psychological distress and improved emotional resilience. Percentage of children with no concerns across all domains at 27-to-30- month assessment 82.10% 87.30% 85.30% No data No data - No data is available for 2024/25. This measure is taken from SOLACE LGBF indicators but has not been reported since 2022. 95% of schools have a suitability rating of A or B 95.00% 95.00% 95.00% 95.00% 98.00% G The overall position for suitability scores is 61% have a rating of A, 37% were rated as B. Page 70
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26 Support and interventions for our care experienced children and young people Each care experienced child and young person (CECYP) enrolled in an authority school has tracking and monitoring in place via our education management system, SEEMIS. Data collated includes attendance, exclusion, progress and achievement and progress over time. Scrutiny of this data has led to early interventions to support our CECYP, in some cases positively impacting attendance and attainment. To date we have zero exclusions of CECYP. This is a major success that can be attributed to supportive policy, collegiate and partnership working and greater awareness of the needs of our CECYP community. The Virtual Head Teacher (VHT) links to Designated Managers across settings where CECYP are enrolled to both support and challenge the learning experience for our CECYP. We continue to explore the information arising from our data, ensuring our Health and Wellbeing Family Liaison Officers target those most in need. We are supported by wider colleagues in education to meet this target. Addressing non-attendance Seven out of ten secondary schools have completed the Addressing Non-Attendance training programme and continue to implement this with support from Educational Psychology Service. Training for primary school staff has been developed and implemented in some settings. Across the authority, the Maximising Attendance policy is supporting a more consistent and data-informed approach to monitoring attendance and intervening early to help children, young people, and families overcome barriers to school attendance. Maximising attendance remains a key strategic priority, with ongoing liaison with Education Scotland colleagues to ensure alignment between local policy and national recommendations. UNICEF UK’s Rights Respecting School Programme Apple Tree Nursery in Rothesay became the first nursery in Argyll and Bute, and only the third in Scotland, to receive a prestigious gold award from UNICEF UK’s Rights Respecting School programme. Children living in Poverty We are one of the lead players on a national level identifying those who are not in receipt of full benefit entitlement, working to identify ways of using data to identify those in need. Work is ongoing with the Improvement Service and Scalable Approach to Vulnerability Via Interoperability (SAVVI) to find the best approach and legal gateways to allow use. Reducing poverty with the power of right advice Our Welfare Rights Team has a significant impact in the outcomes for families by helping them maximise their uptake of available benefits grants and allowances, securing Client Financial Gain in excess of £4 million per year. Key to success is the close working of statutory and voluntary sectors. Examples include: Flexible Food and Fuel Fund – our benefits team, ALI energy and the Bute Advice Centre manage this innovative scheme that sees considerable grant aid to people every year, coupled with benefit and fuel poverty solutions advice. Page 71
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27 Infant Food Insecurity Pilot – a one-year pilot study is taking place to access the level of crisis need for baby formula, where there is no other immediate solution. Supermarket vouchers are placed with Midwives and Health Visitors and a picture of the nature of this need is being identified. Safe homes for families who need them most The Local Housing Strategy (LHS) aligns with the aims and objectives our Child Poverty Action Plan and outlines a series of actions to address disadvantage and alleviate poverty. These include preventing families and young people in certain situations from incurring rent arrears, from becoming homeless, assisting families with a disabled family member, and assisting larger families. In 2024/25, 476 homeless cases were closed, of which 121 involved households with dependent children (amounting to 199 children) and 86 of these households received a positive outcome. There has been a slight reduction in homeless applications between the 1st of April 2024 and the 31st of March 2025. During that period, 459 homeless applications were made, a decrease of 34 applications (7% down) in the same period in the previous year. Making life more affordable for families Pre-loved School Uniform Project - The two-year funded pre-loved school uniform project has come to an end. The project was set up to focus on the reuse of good quality preloved school uniform and the recycling of uniforms that are no longer fit for purpose. Working with schools, community groups, and parent councils across all seven of our main settlements to support eco-friendly reuse school uniform schemes that cover school uniform for Early Learning Centres, Nurseries Primary and Secondary Schools linked to each school cluster. We investigated, supported, and promoted taking donations of uniform from parents and pupils, ways to launder them and methods of redistributing them as and when they are required. The project has achieved many of the goals we envisaged and many more that developed during the project in a positive and meaningful way. It also highlighted that more work is needed to keep this momentum moving forward. Much of the work and schemes will continue and the project has shown that with further support and encouragement much more could be achieved. For full details of the project report, when published, will be available from Pre-loved School uniform scheme | Argyll and Bute Council. My Tribe Free Period Product Initiative - our free period product initiative, plays a vital role in tackling child poverty by ensuring that no child misses out on education due to lack of access to essential items. By providing free period products in over 150 community locations and through a user- friendly online ordering system that delivers directly to any household in Argyll and Bute, My Tribe helps ease financial pressures faced by families. Schools Share and Recycle - Gigha Primary school have a community fridge, which they keep fully stocked with fresh items of food. They have been very surprised at the uptake and need to restock very regularly. Dalmally Primary School are actively involved with the charity Mary’s Meals and pupils fundraise and raise awareness. Most of our schools have a Uniform Bank where pupils can access pre-owned items of school uniform. Pupils, staff, and parents spoke of the Uniform Swap Shop, with children learning that not everything needs to be bought new. Page 72
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28 Award winning school meals service We delivered 1.2m early years, primary and secondary school meals, with new menus introduced in August 2024 receiving positive feedback. The Catering Team wowed judges at the Public Sector Catering Awards with their wild venison school meals, earning them the Sustainability Award. Early years and primary meals were awarded a recertification for Food for Life Served Here - Bronze award. School Counselling Service The service has supported 472 young people in secondary schools and 216 children in primary schools. The most common reasons for referral include anxiety, low mood, family difficulties, and emotional regulation. 83% of young people and 81% of primary-aged children completing support reported positive clinical outcomes, including reduced psychological distress and improved emotional resilience. This is further supported by positive parent feedback, with 100% of parents feeling more confident in supporting their child's emotional and developmental needs and 94% observing positive changes in their child’s wellbeing. School suitability ratings Through the Capital Programme only Tobermory 2-18 school still has a C rating for suitability. There are plans for a new school on Mull through the LEIP programme which will ensure 100% of our schools will have a suitability of A or B. The four-year planning for the new school building in conjunction with the Hub North, will ensure that the new school have both a condition and suitability scoring of A. Page 73
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29 Corporate Outcome: Education, skills, and training will maximise opportunities for all Number of indicators: 7 Number on track: 1 Number no target / no data: 6 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Maintain the percentage of all young people leaving school achieving a positive destination into further education, training, or employment. *ACADEMIC YEAR 95.00% 93.50% 95.20% 94.30% No data - The data supplied for 2024/25 will not be available from the Scottish Government until February 2026. Maintain the percentage of successful examination presentations in Levels 4 and 5 for literacy and numeracy by our senior phase pupils *ACADEMIC YEAR 60.00% 97.00% SCQF4 87.23% SCQF5 66.84% SCQF4 84.08% SCQF5 66.59% 64.82% G The percentage of Argyll and Bute school leavers who achieved Level 5 literacy and numeracy was 64.8%, above the target of 60% Page 74
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30 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Percentage of modern apprentices that go on to a positive destination after completing the Argyll and Bute Modern Apprentice Programme 95.00% 96.10% 96.20% 94.55% 90.00% R The target was narrowly missed due to a small number of applicants not completing the programme however, 70% have successfully secured employment within the Council. Percentage of children that achieve their appropriate developmental milestones by Primary 1 70.00% 64.00% 63.00% 61.00% 61.00% R As a result of developmental effects of covid lockdowns, we continue to work collaboratively with health and allied health professionals to ensure that we are addressing developmental concerns as early as possible. Percentage pass rate for the National 5 qualification is comparable or better than the Scottish national average *ACADEMIC YEAR No target 79.70% 77.39% 75.60% 77.20% No target The Argyll and Bute A-C pass rate of 77.2% is in line with the National figure of 77.4%. The A-D pass rate of 89.9% is slightly above that of the national figure 989.2%) Percentage pass rate for the National Higher qualification is comparable or better than the Scottish national average *ACADEMIC YEAR No target 80.90% 77.35% 72.00% 73.40% No target The Argyll and Bute A-C pass rate of 73.4% is slightly behind the National pass rate of 74.8%. However, the A- D pass rate of 89.9% is slightly above that of the national figure (89.5%) Page 75
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31 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Increase the uptake of wider achievement opportunities which complement traditional SQA awards and offer alternative ways to develop learning, life, and work skills No target - 88.00% 100.00% 9.98% No target In 24/25, 9.98% of all senior phase pupils completed a wider achievement award as part of their overall attainment profiles. Developing the young workforce Analysis of 23/24 attainment data has been completed and demonstrates a continued growth in the presentation for and passing of wider achievement awards. Data shows that the percentage of senior phase pupils who presented for a wider achievement award has grown from 7.3% in 22/23 to 9.9% in 23/24. This figure also surpasses the 5 years high of 9.8% in 2019/20. The average tariff points awarded to Argyll and Bute pupils (52) who passed wider achievement points is also above the virtual comparator (35) and national figures (36). This average was also an increase on the 22/23 figure (46). These two figures show that a higher proportion of our pupils are engaging with high quality wider achievement awards. We received the Insight raw data set in November which allows us to explore at a pupil level which wider achievements were achieved, and in which centres they were presented. Analysis of the data is underway to ensure the relevant Education Officer is equipped with the best insight possible to support and challenge our schools. Further analysis of Insight leavers data, published in February 2025, shows that wider achievement made up 11.4% of all attained entries for our S6 leavers. This was the highest it had been in the last 5 years and higher than both the virtual comparator and the national figure. This data shows that wider achievement is increasingly becoming part of a revised curriculum which complements traditional SQA awards. Helping People into work Education and DYW have worked in partnership with Skills Development Scotland (SDS), the 3rd Sector and a wide and increasing range of employer partners to develop young people’s skills, formulate personalised learning pathways and track young people’s progress, both towards and within positive destinations. As a result, 94.8% of school leavers in 2023/24 entered positive destinations and 94.3% of all 16–19-year-olds were in education, training or employment, which equates to Argyll and Bute ranking 9th out of Scotland’s local authorities. Partnerships between schools and employers have continued to increase and as a result, a total of 387 work placements – a 60% increase on 2023/34 – have supported young people to plan their individual vocational pathways and develop skills for life and work, confidence and resilience. Page 76
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32 Forty Flexible Learning Plans (FLPs) have been in place across all secondary schools. FLPs have continued to provide bespoke curricula for young people who require such provision. All secondary schools have demonstrated increased capacity for and commitment to planning individualised curricula and timetables for young people. As a result, vulnerable young people at risk of disengagement have re-engaged with education and are entering sustained destinations in employment and training/apprenticeships. Frequent and regular 16 Plus meetings are being held in secondary schools in partnership with SDS and DYW. As a result, all secondary schools have robust frameworks for intervention to support school leavers at risk of not entering a positive destination, and to track young people post-school to ensure positive destinations are sustained. Our number of Modern Apprentices employed has remained consistent over the last few years, but to improve our approach we have included evaluation in our Growing Our Own framework. Modern Apprentices and their managers will be encouraged to provide feedback in this respect to ensure that the programme remains fit for purpose as a pipeline into longer-term employment. Literacy and Numeracy Full analysis of 23/24 literacy and numeracy data has highlighted the varying levels of attainment across all schools which will allow for interventions to be designed and implemented. This information, along with other relevant measures, has been organised into secondary attainment meeting packs which will be used to support improvement meetings. S3 BGE data for 23/24 shows increases at the fourth level, which should logically flow into improvements at National 4 and 5 awards in 24/25. Insight data for leavers, which included post appeal data, was published in February 2025. The percentage of leavers who left with Level 4 literacy and numeracy was 83.2%. The percentage of leavers who left with Level 5 literacy and numeracy was 64.8%. Both are above the target of 60%. Play on Pedals Our Play on Pedals collaboration with Bike-ability Scotland is now operating in 3 of our 4 localities, including one island, enabling young children to achieve their gross motor milestones, through learning to balance and pedal a bicycle. We are currently awaiting our most up to date development data, however, initial qualitative data indicates that for children involved in the scheme, achievement of gross motor developmental milestones is above average, and as an additional benefit, stronger parental engagement and confidence in cycling with their children has been reported. Attainment Attainment data for the 2023/24 academic year has been reviewed at both the authority and individual school levels. At the authority level, Argyll and Bute recorded a National 5 pass rate of 75.9%, slightly below the national average of 77.2%. Notably, five out of ten secondary schools in the area achieved pass rates above the national figure. Further analysis revealed that in 15 National 5 courses, Argyll and Bute's pass rates exceeded national performance. At the Higher level, the authority-wide pass rate was 72.0%, again slightly trailing the national average of 74.9%. However, three secondary schools outperformed the national pass rate. Additionally, Argyll and Bute achieved higher pass rates than the national average in 16 Higher courses. Page 77
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33 Schools have received detailed data to support targeted improvements at the subject level. Information from the results machine has been shared, enabling schools to identify subjects that are performing above or below national averages. This insight allows for focused attention on specific course components to enhance overall performance. Schools have also been provided with data on the accuracy of their grade estimates for the 2023/24 exam diet. This will support improvements in assessment and moderation practices, helping schools more effectively track learner progress. Page 78
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34 Corporate Outcome: Our economy is diverse and thriving Number of indicators: 12 Number on track: 0 Number no target / no data: 12 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Maintain the percentage of local suppliers that benefit from the awards of contracts via the procurement portal 20.00% 13.50% 19.90% 17.80% 18.70% R During 2024/25, 183 tender/quick quote contract awards were placed with 203 successful suppliers, 38 of which were local suppliers (18.7%). Increase the number of community benefits that are delivered through the contracts we award locally No target 55 73 74 75 No target 31 Community Benefits have been achieved through Contract Management, Contract Awards and the Request List .44 Community Benefits have been achieved through Contract Management, Contract Awards, and the Request List. Number of business and industry planning applications submitted annually No target 19 23 21 13 No target Although applications submitted during 2024/25 have decreased, these include some significant new investments in Argyll and Bute. Percentage of homeless applicants who required temporary accommodation this period No target 40.00% 34.00% 29.00% 29.00% No target 29% of new homeless applicants required temporary accommodation in 2024/25. Page 79
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35 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Number of affordable social sector new builds completed per annum No target 145 188 70 54 No target Registered Social Landlord (RSL) partners completed 44 new affordable housing units across Argyll and Bute. Total number of visitor trips to Argyll and Bute No target 1.5M 2.5M 2.8M 3.312M No target Data provided by Scottish Tourism Economic Activity Monitor (STEAM) on an annual basis (calendar year). The significant increase from 2021 to 2024 is due to the number of visitors recovering from extremely low numbers during the Covid-19 pandemic period. Total visitor spend in Argyll and Bute No target £262.5M £407.5M £461.5M £566M No target Data supplied by Scottish Tourism Economic Activity Monitor (STEAM) on an annual basis (calendar year). The significant increase in the total economic impact of tourism from 2021 to 2024 is due to the number of visitors recovering from extremely low numbers during the Covid-19 pandemic period. Gross Value Added (GVA) per capita No target £23,394 £47,270 £47,270 No Data No target Data supplied by Office for National Statistics (ONS). Data not yet available. Page 80
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36 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Unemployment rate - claimant count as a %age of working age population No target 4.00% 2.80% 2.50% 2.70% No target In April 2025, 2.7% of the working age population in Argyll & Bute were claiming unemployment benefits – lower than the national average for Scotland of 3.1% and significantly below the UK average of 4.1%. Unemployment rate - claimant count as a %age of the population (16-24) No target 4.30% 2.80% 0.41% 0.43% No target As of April 2025, 0.43% of the population aged 16-24 in Argyll & Bute were claiming unemployment benefit. While no target has been set, the key focus remains to maintain low unemployment levels and to ensure that individuals are engaged in sustainable and meaningful employment, rather being under employed. The number of Business Gateway start-ups per 10,000 of population No target 154.3 135.7 135.0 152.0 No target During 2024/25, Business Gateway successfully supported the creation of 152 new start-ups. Geographical percentage coverage of 4/5G mobile connectivity 95.00% 79.00% 81.00% 85.00% 89.00% R According to latest Ofcom report update (Jan 25), 57% of Argyll and Bute Geographic Area has 4G coverage all 4 operators, this rises to 89% coverage from at least 1 operator, however there are geographic variations dependant on mast locations and level of investment, 11% of Argyll and Bute Geographic area has no 4G coverage from any operator. Page 81
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37 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Currently Argyll and Bute 0% 5G coverage from all 4 operators, however some operators have started upgrading infrastructure to incorporate 5G technology. 26% of Argyll and Bute has 5G coverage from at least 1 operator. Supporting economic recovery and our communities During 2024/25, 183 tender/quick quote contract awards were placed with 203 successful suppliers, 38 of which were local suppliers (18.7%). From the 53 awards that received a local bid, 37 tender/quick quote awards were awarded to a local supplier (69.8%). 31 Community Benefits have been achieved through Contract Management, Contract Awards, and the Request List during the period from 1st April 2024 to 30th September 2024. 44 Community Benefits have been achieved through Contract Management, Contract Awards, and the Request List during the period from 1st October 2024 to 31st March 2025. 31 Community Benefits have been achieved through Contract Management, Contract Awards, and the Request List during the period from 1st April 2024 to 30th September 2024.44 Community Benefits have been achieved through Contract Management, Contract Awards and the Request List during the period from 1st October 2024 to 31st March 2025. Affordable social sector new builds The 44 new affordable housing units completed by Registered Social Landlord (RSL) partners included 38 units for social rent and 6 properties for New Supply Shared Equity (NSSE). In addition, Trust and West Highland Housing Association both acquired a property on the open market, whilst following transfer of stock to Fyne Homes they completed the renovation works to eight affordable flats in Rothesay raising the annual completion total to 54. The challenges of housing delivery are well-articulated in the work surrounding the Housing Emergency, particularly infrastructure constraints, construction skills shortages, materials inflation, financial costs. Page 82
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38 Business Support – case studies Lochawe Hardwoods An Argyll-based business has achieved significant business growth, including a boost in turnover, after accessing support from Business Gateway. Ian McAdam established Loch Awe Hardwoods in 2017 along the south shore of Loch Awe. The business operates its own sawmill to supply a range of products to customers across the region. Ian’s business journey has been supported by a Business Gateway adviser, who linked him up with a digital expert for a fully funded digital review to give guidance on growing Loch Awe Hardwoods’ digital presence to reach new customers. Using the recommendations from the digital review, Ian plans to enhance the company’s online presence even further, with an updated website and increased engagement on social media platforms such as Facebook to better showcase Loch Awe Hardwoods’ products and services. Through Business Gateway, Ian has also accessed funding towards machinery from the UK Shared Prosperity Fund, which has enabled the business to expand its product range, leading to an increased customer base and improved turnover. Lomond Clinic, Helensburgh A Helensburgh healthcare clinic has been given a boost after receiving digital support from Business Gateway in Argyll & Bute. The Lomond Clinic supports locals through its range of healthcare services, which include medical and alternative treatment options encompassing health, beauty, massage, physiotherapy, acupuncture, counselling, exercise and nutrition. Founder Jill Du Toit has been supporting Helensburgh residents since 2002, when she first launched her clinic with Business Gateway start-up support. Page 83
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39 Throughout her business journey, Jill has been supported by her local Business Gateway team, who has provided expert guidance and advice as she has grown and developed The Lomond Clinic. One-to-one support from Business Gateway has helped Jill to develop her business plan to keep up with client demand. As part of recent efforts to improve The Lomond Clinic’s online presence, Jill participated in a one-day digital review with Business Gateway, which gave her a clear action plan on improvements to her website and social media. This has enabled Jill to effectively reach and communicate with new customers, supporting The Lomond Clinic’s continued development. Jill has also previously received advice on routes to funding and accessed grants that have helped her to expand her team and secure medical diagnosis equipment. Green Cup, Lochgilphead A Ukrainian national who relocated to Scotland has brought a taste of her homeland to Lochgilphead by opening Green Cup, a coffee shop. Owner Inna Arnautova offers specialist coffees and teas and accessed support from Business Gateway to help turn her passion for coffee into a thriving business. Inna, her husband and their three children moved to the area from Ukraine in January 2023 amidst Russia’s invasion of Ukraine. Keen to establish her roots in Argyll and Bute further, Inna had an idea to launch her very own coffee shop and approached Business Gateway for support earlier this year. She was soon connected with Donald Melville, a business adviser. Drawing on Donald’s expertise and resources, Inna successfully navigated the challenges of starting a new venture in a foreign country. Inna benefitted from advice on taking on a new premises and routes to funding. Through her local Business Gateway, Inna also benefited from a specialist adviser surgery which taught her more about using social media channels such as Facebook and Instagram to market her business to the right audience. Since its opening, Green Cup has proved popular with locals, and visitors alike, gaining positive attention for its new and unique offer in the town. Inna told us “I’m incredibly grateful for the support I have received from Business Gateway. Starting a new business was a long haul but Donald helped me along the way with any questions that I had. I’m looking forward to what’s to come in the future.” Page 84
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40 Donald Melville, Business Gateway adviser, said: “The success of Green Cup highlights the opportunities available to budding business owners in Scotland, especially to those who bring diverse perspectives and new ideas to the local economy. Inna’s story serves as an inspiration to other aspiring business owners looking to make their mark.” UK SHARED PROSPERITY FUND – Business Support Programme Between June 2023 and March 2025 Business Gateway delivered a programme of additional support worth £516,521, fully funded through the UK Government Shared Prosperity Fund: • 87 small business development grants • 16 training, trade fair, accreditation or digital grants • 75 start-up grants • 9 expert help (1 to 2 days support) • 6 participants in intensive business support programme Of the 51 clients followed up to date, turnover has increased from a combined £10.7m at approval to £15.7m 12 months after the support (47% increase). The number of employees has grown from 96 to 136 (41% increase). Across the 165 unique businesses approved for support, turnover is predicted to grow by 32% to £32.8m and FTEs to grow by 47% to 468 within 12 months, so it is encouraging to see growth actually delivered from the early beneficiaries. Impact data will be mature in May 2026. £200k has been secured for the UKSPF Transition phase, to continue grant and expert help support in 2025. The Rural Growth Deal (RGD) The Rural Growth Deal (RGD) is a partnership approach to rural economic development which will deliver £50 million of investment equally funded by the Scottish and UK Governments where it will best develop Argyll and Bute as an inclusive, sustainable, economically successful region and driver for Scotland and the UK. Argyll and Bute Council, along with key stakeholders, will seek to contribute at least £20 million of match funding throughout the 10-year programme to accelerate inclusive economic growth for the region. The RGD will provide a catalyst for inclusive economic growth that will retain and attract working-age people in the area. It will create opportunities that can help to anchor the future prosperity of some of our key employment sectors. The programme comprises seven themes with key interdependencies between many projects, bringing together partners from the public, private, and third sectors who are all committed to delivering inclusive economic growth that benefits the whole region. The seven themes are: Page 85
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41 • Tourism – Creating a World Class Visitor Destination • Creating a Low Carbon Economy • Rural Skills Accelerator Programme • Housing to Attract Economic Growth • Clyde Engineering and Innovation Cluster • West Coast UAV Logistics and Training Hub • Marine Aquaculture Programme Over the programme lifetime, it is estimated that the RGD will: • Generate over £5 million per year across its 10-year duration. This figure reflects the annual capital funding drawn down as part of the RGD, with a total of £50 million being provided by the Scottish Government and UK Government over the full-term equating to approximately £5 million per annum. In addition to this financial investment, the deal will deliver wider economic benefits, which will be clearly mapped out as individual projects progress.” • Directly and indirectly create over 300 additional jobs associated with the economic benefits accrued from growth RGD projects. • Attract more than 70,000 tourists to the area. • Assist the transition towards a net zero economy. • Deliver skills and training opportunities to more than 6000 students / workers. • Create an enhanced culture and leisure offering for local people to make Argyll and Bute a more attractive place to live and work. • Construct housing and worker accommodation in some of our remote and fragile island communities as part of wider efforts to address our local housing emergency. The Full Deal Agreement was signed in March 2025, at a ceremony in Rothesay, Isle of Bute signed by Cllr Jim Lynch on behalf of Argyll and Bute Council, Kate Forbes MSP, Deputy First Minister for the Scottish Government and Ian Murray, Secretary of State for Scotland for the UK Government. This event was a key milestone in RGD delivery and marked the beginning of the 10-year programme of investment across Argyll and Bute. Page 86
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42 Strategic Transportation Strategic Transportation were successful in securing £100k from the SG Islands Infrastructure Fund to engage, supply and support 4 communities to establish Digital Hubs on their Islands. The Islands were Coll (An Cridhe), Tiree (Development Trust Building), Iona (Community Hall) and Islay (Kilarrow Hall). All 4 locations have an additional 3-year extended warranty and a direct line to the supplier for technical advice. Scottish Futures Trust Argyll, and Bute Council in partnership with Scottish Futures Trust were the first LA in Scotland to begin this full-scale area wide mobile coverage mapping project. Several others have followed suit. The data that is being received provides an actual coverage rather the assumed coverage data that was previously available. Data received through this ongoing project challenges the assumed data which is provided by the current 4 Mobile Network Operator. Page 87
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43 One council: property income We have generated over £956,000 from disposals and generated new annual revenue income of £40,500 driven by our strategy of divesting of surplus property assets and generating income from our estate. Notable sales include: • Eaglesham House in Rothesay, Isle of Bute • Housing development site at Burns Brae, Lochgilphead as part of housing emergency actions. Notable projects include: • The marketing of the Helensburgh Waterfront commercial site, with a preferred developer selected in August 2024, site investigations completed, and utility connections secured. • Oban Airport Business Park has seen the completion of the full business case, funding secured for the site infrastructure and first building, Tier 1 contractor appointed, design team appointed, planning consent received, and site preparation works commenced. We are developing a strategic outline programme which will cover potential opportunities for the Council to develop several of its assets on a commercial basis and will be delivered over a number of years, with the immediate focus being a new Business Park at Kilmory, Oban Airport Business Park and commercial developments at Helensburgh’s waterfront. We secured ongoing commercial planning / building standards work from other local authorities. Not only is this important for us to provide a balanced budget, but it also supports communities in these other Council areas.” Housing Services Partnership with Home Argyll Housing service staff continue to work proactively with clients to offer support and identify solutions which avoid people needing to present as homeless and require temporary accommodation. Similarly, staff are working hard to ensure Housing First Tenancies are successfully sustained, and that Registered Social Landlords (RSLs) increase the number of offers they make to homeless clients. The number of tenancies created by RSLs annually has dropped and the number of offers made to homeless applicants is not reaching the agreed levels creating a continuing need to rely on the sporadic use of unsuitable accommodation types for temporary accommodation. We continue to engage constructively with RSLs & Scottish Government, COSLA and Highlands and Islands Regional Economic Partnership to focus on the issues and delivery. Page 88
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44 Corporate Outcome: We have an infrastructure that supports sustainable growth Number of indicators: 5 Number on track: 3 Number no target / no data: 2 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Percentage of waste recycled, composted or recovered 45.00% 48.30% 52.00% 58.20% 68.30% G The figures provided represent a combined total, with an annual rate of 68.3% for recycling, composting and recovery. This includes 41.5% from recycling and composting and 26.8% from recovery. The target figure will be revised once the landfill ban comes into effect. Number of tonnes of waste sent to landfill (biodegradable) 21,500 18,772 18,165 17,406 14,716 G Since general waste from Helensburgh and Lomond is no longer sent to landfill and is instead processed through refuse derived fuel and energy from waste methods, there has been a significant reduction in the tonnage of waste going to landfill. Percentage of street cleanliness 73.00% 79.00% 83.00% 84.00% 80.00% G The nationally recognised pass rate is 67% The average achievement across all areas is 80%, with every team exceeding the target set. Page 89
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45 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Percentage of roads in need of maintenance as defined by the annual survey No target No data 49.70% No data 50.77% No target The latest Road Condition Index (RCI) for 2023-25 indicates a decline in network condition. This figure is derived from the updated two-year average of completed survey data. Despite the recent dip, the RCI still reflects a continued improvement since the 2018 – 2020 period. Carbon emissions relating to Council activities (Council carbon footprint) tC02e = tonnes of carbon dioxide equivalent Net Zero tC02e by 2045 No target 28,218 26,512 No data 27,515 No target Both the Council and Scotland as a whole, are committed to achieving Net Zero emissions by 2045. Since the baseline year, we have achieved a 31% reduction in carbon emissions. However, current progress – both locally and nationally – falls short of the trajectory needed to meet the interim target of a 75% reduction by 2020 and the goal of Net Zero by 2045. Council Carbon Footprint Projects delivered by the Council that have contributed to the reduction in emissions include: • LED Streetlight Replacement programme • Solar pv and LED lighting installations at Council assets • Installation of low carbon heating systems (e.g. air source heat pumps Page 90
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46 Flood Protection Campbeltown Flood Protection Scheme • The main works contract was certified Complete in May 2024, • The Property Flood Resilience (PFR) element of the project is progressing through 2025 to 2026. As the scheme is largely complete, the only known remaining financial risk at this stage is that of the tender return costs of the Property Flood Resilience works contract. Tender costs are expected to be available in the third quarter of 2025/26 and, if required, the adequacy of the available £350k secured funding shall be reviewed at that stage. Marine infrastructure Oban Harbour For some time now there has been agreement that the Oban Bay area should be formally controlled for maritime safety, we took the step to assume the responsibility for managing the area through an extension of its Statutory Harbour Authority area around North Pier. We are now at the end of an extensive formal process and Transport Scotland continue to work on completing a submission and recommendation to the Cabinet Secretary for Transport. Craignure Terminal Our Harbour Board Members met on 20 March and approved the completion of the Outline Business Case (OBC) and a continuation of the project to the Final Business Case (FBC) pre-construction stage costing c.£3million. The Project Objectives include: • Replace the existing terminal infrastructure, parts of which are in poor condition, deteriorating or have limited structural capacity. • Increase berth capacity at the new ferry terminal to allow the full range of design vessels to be safely accommodated. • Ensure vessels can reliably berth year-round at the new ferry terminal, including in challenging weather conditions and overnight, to reduce weather-related cancellations and improve the winter timetable. • Increase resilience of the new ferry terminal operations. • Allow safe and efficient embarkation and disembarkation for both vehicles and foot passengers, including those with impaired mobility and wheelchair users. • Increase capacity of the new vehicle marshalling area in line with industry standards, addressing congestion on the A849. • Provide a new terminal building with modern facilities, meeting staff and passenger requirements. • Provide access for RNLI lifeboat, which is used for medical evacuations from Mull to mainland. • Avoid and minimise disruption to the ferry service as far as practicable during the construction works. Page 91
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47 This next stage will develop more accurate construction costing estimates as the design and methodology become more informed, with the current construction phase projection cost estimated at c.£96 million. Campbeltown Old Quay The Campbeltown Old Quay steel sheet piled walls, particularly wall ‘A,’ was showing accelerated low water corrosion, had holes in the sheet piling, and was showing loss of infill material behind the sheet piling wall. The pier is operational with the Royal National Lifeboats Institute commercial /retail fishing vessels, leisure/private boats, and tourism. The Marine Operations and Infrastructure Design teams have been working together to facilitate the replacement the old steel sheet piles. Infrastructure Design undertook outline designs and costs of 8 Options from which a preferred option to design and construct a deep-water berth was selected. A contract was awarded in March 2024 and works on site began in June 2024. Since then, of ground anchors, backfilling between the old and new sheet piles, 50 metres of cope installation. The remaining works are the completion of cope installation, installation of quay furniture (bollards, ladders, fenders), completion of dredging works, site reinstatement. The completion date for the project is 04 October 2025. Page 92
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48 Ferry services Iona Breakwater A contractor is now established on Iona to deliver a major infrastructure project that includes the construction of a breakwater, a new public toilet block, and slipway enhancements. These works are designed to protect the island’s vital ferry service and prepare for the arrival of new CalMac vessels on the route. The construction phase is expected to last approximately 17 months. This investment will significantly improve the reliability of ferry sailings during adverse weather conditions—an essential upgrade for a community that depends on consistent access to medical care, education, waste collection, and business deliveries. The lack of resilient infrastructure in the Sound of Iona has long impacted daily life for residents, with even a single day without ferry service disrupting essential services. The breakwater will provide critical protection, enable more reliable and frequent crossings, and support broader economic development opportunities on both sides of the Sound. In addition, the existing public toilet block on Iona is no longer fit for purpose. Frequently out of order and unable to meet demand—especially during the busy tourist season—the current facility fails to serve both residents and visitors. A new, accessible, and compliant toilet block is being constructed to provide reliable public amenities. The contract for the project was awarded in November 2024, with on-site works commencing in February 2025. These improvements are the result of extensive local consultation and careful environmental planning, ensuring that the project respects the unique character of this iconic location on Argyll’s coastline. Fionnphort Fionnphort overnight berthing facility is progressing to follow on from the Iona works, for c. 18 months construction. Preparation is progressing to ensure: • Overnight berth • Safe access for crew • Sheltered berthing • Charging and supply facilities • Traffic survey to enhance the passenger road user interface at the terminal An Environmental Impact Assessment (EIA) is in process including the socio-economic assessment. Page 93
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49 Port Askaig Port Askaig has been made ready to receive the new Islay vessel being completed in Turkey and represents a collaboration between Argyll and Bute Council and CMAL who carried out the waterside enabling works. Council works to enhance existing facilities, consisted of relining, signage, parking allocation, CCTV and traffic access control installation. Campbeltown Harbour Campbeltown Harbour continues to be very busy commercially. Harbour improvement in the form of the replacement of ‘Wall A’ at the Old Quay is well underway and due for completion in October this year. Business opportunities include using Campbeltown as a strategic supply hub for aquaculture and planned offshore wind projects are being explored. The continuation of cruise visits as well as military traffic represent a real opportunity to develop the port and secure long-term work in and from Campbeltown Harbour. Rothesay Quay Preparations continue for phase 3 of works, which will see a strengthening of the east roundhead and includes fendering upgrades. This work is currently at the design stage and is planned for tender in 2025. Feolin We will be installing a passenger only access at Feolin, for those periods when the vehicular vessel is not available and the service would otherwise be cancelled. Although these occasions are relatively rare, we have recognised the need for a replacement to the ladder access used at present. A plan for concrete steps between the existing dolphins following a more traditional design has been drawn up and approvals are now underway. Gigha and Tayinloan Planning is well underway to upgrade the marine infrastructure at Gigha and Tayinloan to accommodate new vessels for the CalMac route. Public consultation has been carried out at both sites as part of the Environmental Impact Assessment process. Ground Investigation work has also been completed at the locations, and this will help with refining the construction plans, methodology and costs. Page 94
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50 Gigha Ferry Terminal To facilitate the arrival of a new ferry as part of the Small Vessel Replacement Project (SVRP), the Council’s Marine Operations and Infrastructure Design teams have been working to upgrade the existing infrastructure at Gigha and Tayinloan. A consultant has been commissioned to produce an Environmental Impact Assessment (EIA), design drawings, and tender documents. The designs include a new pier/breakwater at Gigha to allow overnight berthing of the new vessel by the slipway, and an extension of the existing breakwater at Tayinloan. A Ground Investigation was carried out in April 2025. This included boreholes, vibrocores, grab samples, bathymetric surveys, and sub bottom profiling. The results of this investigation will provide information to allow designs to progress and a Marine Directorate consent to be secured for both construction and dredging. Argyll & Bute Council Ferry Services The first of our Ferry Stakeholder Forums held its initial meeting in June on Luing. Thanks to the enthusiasm of the local Community Council, it has begun to shape the available resources to better fit the islands needs and to better understand the constraints the service works within. It is now our intention to roll out this template and attend regular meetings for the remaining services for Jura, Lismore and Easdale and we look forward to involving the local communities alongside us to get the most out of their service. Vessel Priority Strategy The lag in increasing ferry capacity through new vessels is limiting the benefit of cheaper travel costs and impeding mainland travel to islands. New vessels and the associated marine infrastructure to accommodate them at our ports are both expensive and have lengthy lead times. It is therefore important for us to not only have a long-term strategy for vessel replacement but also to look at the longer-term needs of the island communities served by our ferries. A vessel strategy, which represents a realistic and Best Value approach to gain the most benefit from resources as they become available is as follows: 1. On-site accommodation at Port Askaig. The present situation requires Officers and crew to be residents of Islay as well as suitably qualified. Along with the market supplement and the 7-day rota, this will allow the recruitment of suitably certified crew required for resilience and new vessel minimum manning levels. Page 95
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51 2. Concept design to ‘Keel Ready’ for a new Jura vessel to identify capacity levels; fuel type; crew size and infrastructure upgrade requirements. This also allows for a more accurate assessment / estimate of build & certification costs. 3. Jura Ferry replacement and associated infrastructure at Feolin and Port Askaig. 4. Eilean Dhiura re-deployed to the Cuan / Luing route with associated slipway modifications on the route. 5. Easdale work boat replacement with landing craft type vessel. The vessel strategy uses the available resources and maximises the return from investments on vessel life extension works. It gives a service improvement in terms of redundancy and resilience while minimising the new build timescales. This will also allow time to assess future needs and fixed link opportunities for each community. Council vehicle ferries Major work during dry dock periods has now been completed to further extend the working lives of the Eilean Dhiura and the Belnahua. The work continues each year as an investment in the resilience of the vessels as important links to the island communities they serve. Works included engine replacement, extensive steel works, hydraulic and control systems as well as fire safety installations. Road Condition improvements The 2024 Annual Status and Options Report sets out the benefits of continued investment in our road network and highlights the critical risk of underinvestment. Although our network has seen a welcome improvement in recent years, we would need to spend in the region of £11-£14million annually to maintain a ‘standstill’ position, and significantly more to see continued improvements. Budget consultations and public feedback has shown the importance of roads to our communities, but maintaining the required level of investment is likely to be challenging in future years given the predicted decline in available capital funding. This brings with it significant engineering, economic, financial and reputational risks for the Council. We continue to deliver a range of different technical solutions that are designed to be proportionate for the use of the road and take into consideration the island and rural geography of Argyll and Bute. Claoniag landslip To facilitate the arrival of a new ferry as part of the Small Vessel Replacement Project (SVRP), the Council’s Marine Operations and Infrastructure Design teams have been working to upgrade the existing infrastructure at Gigha and Tayinloan. A consultant has been commissioned to produce an Environmental Impact Assessment (EIA), design drawings, and tender documents. The designs include a new pier/breakwater at Gigha to allow overnight berthing of the new vessel by the slipway, and an extension of the existing breakwater at Tayinloan. Page 96
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52 A ground investigation was carried in April 2025. This included boreholes, vibrocores, grab samples, bathymetric surveys, and sub bottom profiling. The results of this investigation will provide information to allow designs to progress and a Marine Directorate consent to be secured for both construction and dredging. Significant Work was carried out with SEPA and the owner of the surrounding land, to enable improvement to a nearby old borrow pit site using excavated material from the Works site. This helped to reduce the impact on the environment and the roads network of transporting large quantities of unsuitable (for engineering fill) excavated material away from the site. Work outside the road corridor will take place during 2025 to complete aspects required by SEPA such as the topsoil and seeding of the improved ex borrow pit area. Balliemore Bridge The original Balliemore Bridge was demolished following its partial collapse during the October 2023 severe weather event. The next critical stage in replacing it included installing six precast, 15 metre long, concrete deck beams onto the reinforced concrete abutments. A 130 tonnes capacity crane was required to consider the safe working radius and capacity of the lifting operations. Further work includes installing pre-cast wing walls and deck reinforcement in preparation for the in-situ concrete deck pour. With the cooperation of Ardtaraig Estate a diversion road was put in place through a field to the north west of Balliemore Bridge, which allowed a temporary bridge to be placed slightly upstream of the existing bridge and reopening of the road. Page 97
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53 Tigh Dearg Road in Kilcreggan. Civils works were completed as part of the flood alleviation scheme to improve the surface water drainage, as well reducing sewerage overflow into the River Clyde, at Tigh Dearg Road in Kilcreggan. This scheme involved de-coupling a 220m combined sewer which took the surface water (rain runoff) and sewerage in one pipe which was connected to the Scottish Water main sewer. This pipe lacked capacity and was a contributor to the ongoing issues faced by locals. The improvements include a new much larger surface water pipe (600mm in diameter) and a new sewer pipe connected only to properties. Improvements have also been made in the road surfacing which has been completely renewed – which provides a drastic visual improvement to the area. To accomplish these works significant logistical and geophysical challenges had to be overcome – such as the high rock read that was present at the site as well as the narrow nature of the street. This added complexity and time to the works but were managed and successfully overcome. Page 98
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54 Corporate Outcome: Getting it right Number of indicators: 5 Number on track: 2 Number no target / no data: 3 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary Increase the percentage of all self-service and automated contracts 70.00% 73.10% 75.00% 76.70% 79.30% G In FQ4 there were 190,503 interactions across all Customer Engagement Team channels. Of these 150,986 were digital self service, which was 79.3%, so the target was comfortably met. Sickness absence days per employee (non- teacher) No target 13.4 14.9 14.6 15.4 No target Employee absence is showing an increasing trend. This is a feature across the entire public sector in Scotland and is concerning. The main reasons for absence in this employee group are Mental Health and back and neck issues. Officers are working in partnership with other councils to ensure we have the best approach possible to analysing data, managing absence and providing the most appropriate support to staff. Our older workforce profile has an impact on our absence but does not account for it all. We continue to focus work with managers to improve this. Sickness absence days per teacher No target 5.6 7.2 9.0 9.6 No target Absence amongst our teaching staff has increased significantly since 2021-22. The main reasons for absence in this employee group are stress and infections. Workload and pupil behaviour have been identified as contributing factors to stress, both of which are nationally recognised issues. Officers are working in partnership with other councils to Page 99
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55 Corporate Outcome Indicator Target 2021/22 Actual 2022/23 Actual 2023/24 Actual 2024/25 Actual Status Commentary ensure we have the best approach possible to analysing data, managing absence and providing the most appropriate support available to staff. Level of employee satisfaction No target - - - 3.5 No target Employees were asked to rate on a scale of 0- 5 stars their overall experience of working at Argyll and Bute Council. The indicator is the average score and will be monitored on an annual basis. Level of customer satisfaction 92.5% combined 92.00% 97.60% 96.95% 93.00% G FQ4 outcomes were: 97.7% Satisfied for Customer Service Points (455 question responses), 96.4% satisfaction for Contact Centre (from 403 survey respondents), 100% satisfaction with Registration Service from 85 survey respondents and 78% Web Visit satisfaction, giving an overall satisfaction score of 93%. Increasing the use of our website and self-service tools In 2024/25 there were 638,863 customer interactions dealt with via all channels by our Customer Engagement Team (up from 661k in 23/24). Of these 155,257 were handled in some way by Customer Service Agents (23%) and 528,606 were automated or self-service transactions (77.3%). This was increase of 18,000 on the previous year and so the % of digital transactions rose from 76% and thus the target was achieved. Website page views increased by over 5%. Page 100
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56 Improving our customer service We have two main measures of customer satisfaction at a corporate level, that on satisfaction with the Customer Engagement Team (Contact Centre, Service Points, Website, Registration) and that measured independently through the Local Government Benchmarking Framework. The former showed high levels of success, averaging 96% for Contact Centre and Face to Face, 99% for the Registration Service and 98% for the accessibility aspects of the website, where we now rank second highest amongst all Scottish Councils. It is important to note however that this reflects satisfaction with how the initial customer contacts are handled. Some services then have their own measures for how the fulfilment of those requests are done by the back-office teams. The LGBF also measure this for some services and out of the 11 indicators four had improved, with overall satisfaction increasing from 55% in the base Year to 82% last year. Award Recognition for Outstanding Innovation and Service We’re proud to share that our teams have received prestigious recognition for their work in 2025. Our Housing Services Team has won the Innovation Award at this year’s Empty Homes Network (EHN) Awards, for its project aimed at bringing properties back into use. Health and Social Care Partnership (HSCP) staff and were highly commended in Meeting the Challenge Award and the Best Partnership Award, highlighting their creative and impactful approach to housing solutions. Page 101
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57 At the Scottish Local Authority Building Standards Scotland Awards, our Building Standards Team received the Outstanding Service and Commitment Award in recognition of their exceptional support to other local authorities. Over the past nine years, the team has led commercialisation efforts on behalf of eight partner councils, processing 3,409 building warrants for projects with a combined works value exceeding £166 million. Supporting our Community Councils We continue to support community councils both from a governance perspective and also regarding some of the more unique queries that come directly to the Community Council Liaison Officer. We’ve seen questions about charitable status, VAT registration, issues with Service Level Agreements which previous community councils had entered into and are supporting a community council who have a binding legal agreement signed from the 1980s which they had no prior knowledge of as nobody involved in those contract negotiations remained on the community council. We successfully re-established a community council which was dormant since 2022 and commenced the necessary project planning required for our periodic review of the Scheme for the Establishment of Community Councils to plan around key committee dates and national standards for engagement on this piece of consultative work. Local Government elections and supporting new elected councillors 2024 saw a snap UK Parliamentary Election called on 4 July 2024 catching the whole electoral community by surprise. In normal circumstances we would have commenced planning for the election at least 6 months prior to a scheduled election taking place. It is well documented that there are issues with the short timetable for this type of elections, and ability for specialist printers to prepare the number of postal packs required given any person can now request a postal vote. These increasing numbers of advanced voters, ongoing issues with Royal Mail, and the timing of the election being during Scottish school holidays caused huge pressure not only on the election team but also on wider council resources. The holiday period meant we required to have new staff appointed on election contracts causing additional work for the election team and human resources teams. Issues with delays in postal votes led to significant enquiries with our team and the contact centre staff. Bespoke arrangements Page 102
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58 were made to try to ensure that postal voters could collect replacement voting packs and complete these if they were going to be out of the area when the main issue of postal votes were due to be delivered. This involved staff from the wider Legal and Regulatory team being asked to receipt and ensure these were handled in accordance with the law. This election saw us taking on part of the Highland Council area within our constituency following the review of Parliamentary boundaries which required us to work with multiple Electoral Registration Officers. It was also the first election requiring voter ID for polling station voting, and the first election where postal votes could not be returned by hand without completion of a form. Committee Support and Member Services In April 2024, a new Council Administration was formed. This required a number of additional special Council meetings and significant preparatory work to pick up and process changes in appointments to internal committees, representation on statutory bodies and a wide range of other external organisations at both strategic and area level, and the development and administration of a new committee and Council meetings programme. Alongside this sat the development and provision of dedicated support for elected members in a period of transition and for those adjusting to new senior roles, again at strategic and area level. The team have also supported the Council’s election team in the administration of a by-election in July 2024 following the passing of the late Cllr Robin Currie. Following the election, they provided induction support for the new councillor and have added to their learning and preparation for the significant 2027 Scottish Local Government Elections administration and larger-scale councillor induction programme which will be required. The Elected Member Development Framework is ongoing throughout the term and includes work with individual councillors using Improvement Service resources to identify personal development needs and potential resources. We have worked with our colleagues in Human Resources & Organisational Development to facilitate access to the Council’s online learning platform for all Elected Members and a “Learning Community” has been established. The team have also delivered another extensive Members Seminar programme over the course of the year. The programme was wide-ranging and included topics such as renewables, tourism, islands strategy, data and technology and other focused sessions on key issues like the A83 Rest and Be Thankful, exploring a Single Authority Model and the housing emergency. Building on the success of previous events and in response to member feedback, the team have supported additional externally delivered sessions offered in partnership with the Local Government Information Unit, including seminars and workshops on advanced communication skills for elected members, conflict resolution and mediation. Page 103
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59 Following the previous year’s review of the councillors’ caseload management system and the establishment of the Member Zone self-service system, team representatives now participate in the Member Zone Sounding Board which brings together stakeholders to look at how the system is performing and where improvements may be possible. Looking after our financial assets The Council’s Counter Fraud Team works alongside Revenues and Benefits, Treasury, Creditors, Payroll and Corporate Debt Recovery to protect the public purse and ensure strong financial stewardship. During 2024/25 the Counter Fraud Team contributed to the identification of £1.48m of Council Tax that required rebilling due to fraud or error. The collection of these amounts is managed through the Council’s normal recovery processes, led by the Corporate Debt Recovery Team. Key achievements across these services during the year include: • We collected £64.5 million in Council Tax during 2024/25, £1.2 million more than was budgeted. • A positive External Audit report was received and presented to Council in December 2024, following completion of the 2023/24 Annual Accounts audit. • Financial monitoring packs and Budget Outlook were submitted to each Policy & Resources Committee. • The average investment rate for 2024/25 was 5.07%, and the investments generated £2.549m of interest during the year. • We processed 97.9% of invoices due within 30 days, exceeding the target of 95.5%. • The external audit of the Council’s Non-Domestic Rates Income (NDRI) Notified Return of £45.415m for 2023/2024 was completed by the statutory deadline with an unqualified audit certificate being received. • Following agreement of the 2024/25 pay awards for Teaching and Non-Teaching staff by October 2024, the Payroll Team processed the uplifts and backdated payments during December 2024. Supporting attendance The aims of the Councils Supporting Attendance policy is to support employee wellbeing and minimise sickness absence through fair, consistent, and compassionate procedures. The policy promotes early intervention, open communication, and tailored support, including access to Occupational Health, the Employee Assistance Programme, and wellbeing initiatives. It emphasises a preventative approach, values good attendance, and ensures that all employees are treated individually and respectfully, in line with the Council’s core values. Increasing absence rates are a national trend across local government in Scotland. Since the introduction of our wellbeing strategy in 2019 the council has improved its ranking in relation to sickness absence by 10 places. Therefore, while our absence rates are increasing and there will be targeted work by the Human Resources & Organisational Development team to continue to tackle this, they are increasing at a slower rate than the national picture. Page 104
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60 The team are preparing to review the Supporting Attendance at Work procedures in the next 12 months to further enhance its effectiveness in addressing high levels of staff absence and to strengthen support for employee wellbeing. Supporting Our People: Insights and Wellbeing Initiatives We conducted an employee survey to gather feedback from staff across all services on their experiences working with the council. The survey explored key areas such as leadership, workplace relationships, workload, wellbeing, and the overall working environment. Follow-up focus groups were held to delve deeper into the findings. Analysis from these sessions has been completed and will be presented to the Senior Leadership Forum in 2025. A comprehensive report, including recommendations and proposed actions, is currently being drafted. We continue to prioritise employee wellbeing. Our enhanced Employee Assistance Programme (EAP) now offers services previously unavailable through our former provider, including physiotherapy and GP appointments. These additions are helping staff access essential support more quickly than through traditional NHS routes. We are also reviewing our Mental Health First Aiders service to ensure it meets current needs. Once approved the updated service will be promoted to all staff, aiming to provide timely support for mental health concerns and help reduce absence durations. Strategic Risk Register The Strategic Risk Register (SRR) details significant risks faced by the Council and the agreed approaches to manage them in the context of risk mitigation. These can be crosscutting across all areas of the Council, although some are very specific to a service function and tend to be long-term in nature. They each have specific interventions, subject to scrutiny at Strategic Committees, and are formally reviewed bi-annually, although the SRR can be reviewed at any time should matters need to be placed on the register by the Strategic Management Team. A formal report is prepared on an annual basis by the Chief Executive on risk management and is reported to the Audit and Scrutiny Committee. Further information can be found within the Audit and Scrutiny Committee meeting area on the council website. Audit and Scrutiny Committee - Argyll and Bute Council (argyll-bute.gov.uk) Currently the SRR has 13 risks in total, 4 are red, 8 are amber and the remaining 1 is green. The red risks relate to: Population, External Infrastructure and Economic Decline, Waste Management, Service Delivery - Cyber Security, Lack of Housing availability. The amber risks relate to: Condition and suitability of Infrastructure & Asset Base, Financial Sustainability, Governance and Leadership, Engagement and Understanding the needs of the Community, Service Delivery, Health and Social Care Partnership, Cost of Living Crisis, Impact of Climate Change The green risks relate to: Civil Contingency & Business continuity. Page 105
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61 Operational Risk Register Executive Director Kirsty Flanagan has eleven red risks which relate to: 1) Environmental Health - dealing with Public Health/infectious disease/food related incidents and emergencies which have significant financial implications for the Council in terms of sampling/monitoring costs, employment of experts, storage and disposal costs (food) etc; 2) Availability of Suitable Temporary Accommodation and Housing Support; 3) Road Maintenance Culverts under 1.5m where extreme localised weather may result in loss of culvert or road loss; 4) Winter Maintenance in respect of adverse weather conditions which require greater than budgeted number of gritting runs; 5) Waste Disposal in relation to the Biodegradable Municipal Waste Ban (known as the BMW Ban); 6) Aging bridges and retaining wall assets which require a level of investment which is currently unaffordable, to ensure a resilient road network; 7) Cyber Security in managing the Council’s assets to ensure they are available to users and meet the needs of the business; 8) vulnerable roads near to the coastline; 9) vulnerability of access to and from Argyll and Bute during severe weather events and/or RTCs where roads or routes are closed; 10) non-compliance with state subsidy regulations with regards to Council and externally funded projects dealt with by the Transformation Projects Team; 11) Roads reconstruction capital funding will be significantly reduced in the coming financial year. Executive Director Douglas Hendry has nine red risk in relation to 1) Failure to maintain the school estate 2) Failure to ensure that Council offices, depots and other properties are improved 3) Increased utility costs 4) Resource – unavailability of Project Management, Professional Services and/or Contractor resources 5) Finance – unavailability of internal capital funding 6) Compliance with conditions of all external funding 7) Capital receipts targets are not met or revenue generating projects not delivered 8) Commercial Catering and Events not meeting financial targets and 9) Challenges within HSCP in identifying budget savings within timescale due to work required to ensure service standards are being met. Operational Risk Registers are monitored on a quarterly basis at Departmental Management Team meetings and are managed accordingly. Service delivery challenges As well as our Strategic and Operational Risk Registers, we face a number of challenges that can impact on service delivery. This is a summary of challenges we have encountered over the year and the actions we have identified and are putting in place to address them. Challenge - Allocation of the Scottish Welfare Fund A key challenge was managing high demand within the limitations of the Scottish Government’s initial programme funding, which was insufficient to meet local needs. Action In response to a projected overspend, the Council allocated an additional £250,000 early in the year to ensure continued support for vulnerable residents. Through careful budget management and a focus on high and medium priority cases, we successfully reduced the Council’s actual contribution to £90,000, maintaining a strong level of support throughout. Although a one-off additional funding allocation Page 106
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62 was issued by the Scottish Government in January, we did not need to use it in-year. However, the need for this additional allocation highlighted the inadequacy of the original funding levels. This funding will be carried forward into 2025/26 to mitigate potential future overspends. Challenge - Discretionary Housing Payment (DHP) Key challenges include difficulty to identify Universal Credit (Housing Costs) claimants affected by the Bedroom Tax without direct Department of Work and Pensions data and barriers reaching tenants in the private rented sector, where DHP take-up remains low. This resulted in DHP spend at 89.2% and below the 96% target. Action Planned improvements for 2025/26 include closer collaboration with Registered Social Landlords within GDPR guidelines to proactively identify and support vulnerable tenants and enhanced information-sharing and joint working with housing colleagues. We are planning for greater promotion of DHP availability to private sector tenants. Introduction of a revised DHP policy, currently under consultation, to be brought to Council in 2025/26 to improve strategic targeting and delivery. Challenge - Welfare Rights Advice in Health Partnerships Initiative Through this new partnership and referral pathway we have been building links with GP practices. Due to rural locations, it was initially difficult to identify GP practices where an adequate number of referrals could be achieved. Action We have identified two additional surgeries where we will be offering this service to reach more clients. Challenge – Access to financial support for those that need it most Due to the cost-of-living crisis and Welfare Reform changes some clients will continue to struggle financially even after intervention from advice services. Some clients, particularly vulnerable individuals and families can be hard to reach and engage with and may have unmet needs. Action We have planned increased community engagement with partners and community groups in 2024-25 to increase awareness of the Welfare Rights Service and what we do. It also ensures clients and partners know how to access the service for support. Challenge - Achieving and sustaining positive destinations for young people Young people across Argyll and Bute face several barriers to achieving and sustaining positive destinations. Remote rurality and transport links, routinely involve dislocation from home to attend further and higher education establishments. Additionally, post Covid-19, a higher proportion of young people are finding engaging with full time education or employment challenging. The requirement to develop young people's confidence, Page 107
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63 resilience and agency is as important as ensuring they are developing the skills to engage with Argyll and Bute's local economy and skills gaps and the national employment landscape. Action Education, Developing the Young Workforce and partners are working to identify key areas of future employment - e.g. tourism, hospitality, renewables, construction, social care, aquaculture and inform and facilitate young people's engagement with these industries. Challenge - Impact of COVID on young children's speech, language and communication development Impact of COVID lockdowns on young children's speech, language and communication development continues to be mirrored within our own data with reports that children present in greater numbers with underdeveloped speech and reduced vocabulary than in previous years. In addition, the number of children with underdeveloped communication and emotional regulation difficulties appear to have increased. Difficulties recruiting HSCP allied health professionals, presents an increasing challenge for ELC staff in supporting children’s development, and for us to meet developmental milestone targets across our authority. Action We are working with health and allied health colleagues, nationally and locally, to support the development of early language and literacy through targeted block model interventions which allows for deeper focus in the areas where it is required. Challenge – Modern apprenticeships with Argyll and Bute Council Opportunities for Modern Apprenticeships has remained consistent however there is a need to create more and varied apprenticeships and ensure we can offer the best possible support for young people in the workplace. Action In 2024/25 we published our Growing Our Framework which outlines the organisation’s ongoing commitment to attracting the workforce of the future and will be taking forward further activities to understand and address barriers to modern apprenticeships. Challenge – website customer satisfaction Website satisfaction measures were difficult to collate and review as the tools to do this were no longer compatible with the new website. Action The web team has now fully re-engineered these to follow Govmetric principles, and we now have improved customer data to report on for 2025/26. Page 108
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64 Consultations – we asked, you said, we did We want to ensure that proposed developments are what our citizens and communities want. To help us obtain your views we post our consultations on our website. The following link will take you to the ‘closed’ consultations which relate to this reporting period. Consultation Results | Argyll and Bute Council (argyll-bute.gov.uk) Page 109
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE FINANCIAL SERVICES 16 DECEMBER 2025 TREASURY MANAGEMENT STRATEGY AND ANNUAL INVESTMENT STRATEGY MID-YEAR REVIEW 2025-26 1.0 EXECUTIVE SUMMARY 1.1 The Local Government in Scotland Act 2003 requires the council to have regard to the CIPFA Code of Practice in Treasury Management (revised 2021), the Code. Key reporting requirements in this respect include an annual Treasury Management Strategy Statement, including the Annual Investment Strategy; a Mid-year Review Report; and an Annual Report. 1.2 This mid-year report, prepared in compliance with the Code, covers the following: • An economic and interest rate update; • A review of the approved Treasury Management Strategy and Annual Investment Strategy; • An update on the capital position and Prudential Indicators; • An update on borrowing and investment activities; and • Compliance with Treasury and Prudential Limits. 1.3 The reports key highlights comprise the following: a) All borrowing and investment activity during the period 1 April to 30 September 2025 has been undertaken in accordance with the approved 2025-26 Treasury Management Strategy and Annual Investment Strategy and the authority has operated within the treasury and prudential limits set out therein; b) During the year to 30 September, the authority has continued to maintain an under-borrowed position. Whilst an element of new PWLB borrowing has been undertaken during the year to date, providing a degree of budget certainty, the significant level of internal reserve fund balances has provided an opportunity to largely defer new external borrowing, whilst also minimising exposure to investment risk. This borrowing strategy will require to be regularly reviewed to achieve optimum value and minimise risk exposure in the longer term; Page 111 Agenda Item 8
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c) New PWLB borrowing of £20.000m has been undertaken in the year to date, providing an element of certainty in respect of the underlying borrowing requirement. PWLB loan principal of £0.840m has also been repaid during the year to date in respect of a 10-year loan taken on an Equal Instalments of Principal (EIP) basis; d) The limit of investments has reflected the level of available reserve balances, together with provision for managing the authority’s day to day cash flow requirements. The average rate of return on these investments in the year to 30 September was 4.23%, compared to an average benchmark overnight SONIA rate of 4.19% over this period; e) As at 30 September 2025, the council’s loan debt (excluding other long- term liabilities) totalled £148.968m, while treasury investments totalled £67.579m; and f) Since approval of the 2025-26 Treasury Management Strategy in February 2025, capital planning assumptions have been updated and a new accounting standard, IFRS 16 in respect of accounting for leases and lease type arrangements.has been adopted. As such, it has been necessary to revise the Prudential Indicators set out within the approved strategy. 1.4 The Audit and Scrutiny Committee is asked to recommend that Council: • Note the report, and the treasury management activity undertaken over the period 1 April to 30 September 2025; and, • Approve the revised 2025-26 Prudential Indicators, as set out within paragraph 5.2.3 of the report. Page 112
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE FINANCIAL SERVICES 16 DECEMBER 2025 TREASURY MANAGEMENT STRATEGY AND ANNUAL INVESTMENT STRATEGY MID-YEAR REVIEW 2025/26 2.0 BACKGROUND 2.1 The authority operates a balanced revenue budget, which broadly means cash raised during the year will meet its cash expenditure. Part of the treasury management operations ensure this cash flow is adequately planned, with surplus monies being invested in low-risk counterparties, providing adequate liquidity initially before considering optimising investment return. 2.2 The second main function of the treasury management service is the funding of the authority’s capital investment plans. These capital plans provide a guide to the borrowing need of the authority, essentially the longer-term cash flow planning to ensure the authority can meet is capital spending obligations. This management of longer-term cash may involve arranging long or short-term loans, or using longer-term cash flow surpluses and, on occasion, existing debt may be restructured to meet authority risk or savings objectives. 2.3 The Chartered Institute of Public Finance and Accountancy is currently consulting local authorities in respect of potential changes to the Treasury Management and Prudential Codes of Practice. At this point, the key focus appears to be in respect of non-treasury investment. However, officers will provide an update on any material developments or changes in due course. 2.4 The adoption of a new accounting standard, IFRS 16 in respect of accounting for leases, applicable from 1 April 2025, has impacted the assets and liabilities recognised within the council’s balance sheet. In addition, an element of services revenue expenditure now requires to be accounted for as financing costs. As anticipated, the annual accounts for the year ending 31 March 2025 have been restated on this basis, as part of the audit process. It is worth noting that there has been no impact on the General Fund balance as at 31 March 2025 as a result of these changes. Page 113
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2.5 Leases and lease-type arrangements, previously accounted for as revenue activity are generally now recognised on the balance sheet as ‘Right of Use Assets’, with associated long-term liabilities in respect lease payments, payable over future years. This is essentially to recognise the long-term obligations associated with these types of arrangements. Over two hundred assets, held under lease-type arrangements, including fleet and property are now represented on the council’s balance sheet. The council’s PPP type arrangements in respect of the school estate are also accounted for on an IFRS 16 basis. 2.6 In addition to any required updates to the Prudential Indicators, set out within the approved 2025-26 Treasury Management Strategy, as a result of updated capital plan assumptions, updates will be necessary in respect of IFRS 16 accounting changes. 3.0 INTRODUCTION 3.1 The Local Government in Scotland Act 2003, and supporting regulations, requires the authority to have regard to the CIPFA Code of Practice on Treasury Management (revised 2021), the Code. The Code requires full Council to receive an annual Treasury Management Strategy Statement, including the Annual Investment Strategy, for the year ahead; a Mid-year Review Report; and an Annual Report following the year end. 3.2 The regulatory environment requires the authority to delegate responsibility for the monitoring and scrutiny of treasury management activities, strategy and policies to a specific named body. For this authority, the appropriate delegation body is the Audit and Scrutiny Committee. Treasury management training was delivered to members of the committee during October 2024. There is also a Treasury Management Toolkit, available to members, to support this scrutiny role. 3.3 Prudential and Treasury Indicators are designed to ensure capital investment plans are affordable, prudent and sustainable. There are clear linkages between the council’s capital planning and treasury management strategy, with the financing costs arising from capital investment plans considered as part of the overall revenue Budget Outlook. 3.4 This mid-year report, prepared in compliance with the Code, covers the following: • An economic and interest rate update; • A review of the approved Treasury Management Strategy and Annual Investment Strategy; • An update on the capital position and Prudential Indicators; • An update on borrowing and investment activities; and • Compliance with Treasury and Prudential Limits. Page 114
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4.0 RECOMMENDATIONS 4.1 The Audit and Scrutiny Committee is asked to recommend that Council: • Note the report, and the treasury management activity undertaken over the period 1 April to 30 September 2025; and • Approve the revised 2025-26 Prudential Indicators, as set out within paragraph 5.2.3 of the report. 5.0 DETAIL 5.1 Economic and Interest Rate Update 5.1.1 The authority’s appointed treasury advisors, MUFG Corporate Markets, provide updates on the economic position and interest rate forecasts. This is provided as Appendix 1. The first half of 2025-26 saw: • An increase of 0.3% in GDP during the first quarter, followed by the economy flatlining in July, with higher taxes for businesses restraining growth. • A fall in the 3 month / year on year rate of average earnings growth, excluding bonuses, from 5.5% to 4.8% in July. • The Consumer Price Index (CPI) inflation ebbing and flowing but ending at 3.8% by September. • An easing of core inflation (excludes volatiles components such as food and energy) to 3.6%. • Bank of England cut interest rates from 4.50% to 4.25% in May, and then to 4% in August. • The 10-year gilt yield fluctuate between 4.4% and 4.8%, ending at 4.70% as at the end of September. 5.1.2 The 2025-26 strategy included market assumptions for long-term PWLB interest rates and short-term interest rates (Bank Rate) during 2025-26. These are compared to the latest forecast in the following table: 31 March 2026 Interest Rate Forecast Original % Current % Bank Rate 3.75% 3.75% 5 Year PWLB 4.50% 4.50% 10 Year PWLB 4.70% 5.00% 25 Year PWLB 5.10% 5.70% 50 Year PWLB 4.90% 5.40% Page 115
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5.1.3 The latest long-term PWLB and short-term interest rate forecasts, provided by MUFG Corporate Markets, are outlined below. This sets out a view that medium and long-dated PWLB borrowing rates will fall back over the next couple of years. Bank Rate (short-term borrowing) is expected to continue to fall steadily throughout 2026, before reaching 3.25% towards the end of 2027. (a) Long-term PWLB borrowing rates: 2025-26 2026-27 2027-28 PWLB Rates Sept 2025 % Low % High % Low % High % 5 year 4.80 4.3 4.4 4.2 4.2 10 year 5.30 4.8 4.9 4.7 4.7 25 year 6.10 5.5 5.7 5.3 5.4 50 year 5.80 5.3 5.4 5.1 5.2 (Based on the PWLB Certainty Rate, the standard rate minus 20 bps) (b) Short-term borrowing rates: 2025-26 2026-27 2027-28 Sept 2025 % Low % High % Low % High % Bank Rate 4.00 3.50 3.75 3.25 3.50 5.2 Treasury Management Strategy Review 5.2.1 The 2025-26 Treasury Management Strategy was approved by Council on 27 February 2025. The underlying strategy remains fit for purpose in terms of the updated economic position and approved changes to the Capital Plan. However, the 2025-26 Prudential Indicators set out within approved strategy require to be revised to reflect updates to capital planning assumptions and accounting changes in respect of compliance with the new accounting standard, IFRS 16 Leases. 5.2.2 The council’s financial statements have been restated to reflect adoption of the new accounting standard, IFRS 16 in respect of leases. Whilst there is no impact on the council’s General Fund position, the required accounting changes impact the council’s Capital Financing Requirement and Debt calculations. In addition, an element of revenue expenditure previously accounted for as service expenditure, now requires to be accounted for as financing costs. This impacts the calculated Ratio of Financing Costs to Net Revenue Stream indicator. Page 116
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5.2.3 The proposed changes to the 2025-26 Prudential Indicators are summarised in the following table, while more detailed supporting information is provided within section 5.3 of the report. Prudential Indicator Original Revised £m £m Gross Capital Expenditure 71 76 Closing CFR 394 396 Operational Boundary for External Debt 394 396 Authorised Limit for External Debt 402 404 Gross Debt 321 289 Gross Debt less CFR -73 -107 Ratio of Financing Costs to Net Revenue Stream 4.9% 7.4% 5.3 Capital Position and Prudential Indicators Update 5.3.1 This section of the report is structured to update: • The authority’s capital expenditure plans; • How these plans are being financed; • The impact of the changes in the capital expenditure plans on the prudential indicators and the underlying need to borrow; and • Compliance with the limits in place for borrowing activity. Prudential Indicator for Capital Expenditure 5.3.2 The 2025-26 strategy estimated gross capital expenditure of £71.006m for the year. This position is monitored on an ongoing basis, as part of the Capital Plan Monitoring, regularly reported to the Policy and Resources Committee. The 2025-26 estimated gross capital expenditure has now been revised to £76.308m, reflecting updated assumptions contained within the council’s current Capital plan. This increase mainly relates to additional expenditure approvals, and the reprofiling of expenditure from 2024-25 into 2025-26 and from 2025-26 into future years. It is also worth noting that the Capital Plan does not include assets acquired under lease or lease type arrangements. Financing of the Capital Plan 5.3.3 The 2025-26 strategy estimated gross capital expenditure of £71.006m for the year, as outlined above, with £45.199m to be financed from new borrowing. In addition to capital expenditure updates, there have also been changes to the capital income assumptions within the council’s current Capital Plan. These changes potentially impact the level of capital expenditure to be financed from Page 117
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borrowing. Any re-profiling of project expenditure from/to 2025-26 to/from future years, between now and the end of the year, would also impact the underlying borrowing requirement. However, the Section 95 Officer will take a strategic approach to manage the impact of capital investment on the council’s revenue budget, including the use of earmarked reserves, to ensure that capital investment is affordable, prudent and sustainable. 5.3.4 The table below outlines the expected financing arrangements for the updated capital expenditure plans. The net financing need or borrowing element increases the council’s underlying indebtedness (Capital Financing Requirement), although this will be reduced in part by revenue charges for the repayment of debt (principal repayment). This direct borrowing need may also be supplemented by the replacement of maturing debt and to meet other treasury cashflow requirements. Capital Expenditure and Financing Estimates 2025-26 Original Revised £m £m Gross Capital Expenditure 71.006 76.308 Finance by: Specific Project Income 8.302 12.263 General Capital Grant 11.178 11.178 Asset Sales 0.750 1.000 Earmarked Reserves / Revenue 5.577 6.668 Total Financing 25.807 31.109 Net Financing (Borrowing) Need 45.199 45.199 5.3.5 It is worth noting that assets acquired through lease or lease-type arrangements are not financed through direct borrowing. These arrangements result in the recognition of assets; and corresponding lease liabilities, repayable over the term of the lease. Changes to the Prudential Indicators for the Capital Financing Requirement (CFR), and the Operational Boundary for External Debt 5.3.6 The council’s actual CFR as at 31 March 2025 has been restated from £349m (pre-audit) to £360m (post anticipated audit changes) to reflect IFRS 16 accounting requirements. In approving its strategy for 2025-26, Council noted an estimated CFR of £360m as at 31 March 2025 and £394m as at 31 March 2026 (£34m movement). The actual CFR as at 31 March 2025 is unchanged at £360m, while the current projected CFR as at 31 March 2026 has been revised to £396m (£36m movement). The estimated increased movement of £2m in the CFR during the year largely reflects a decrease from the originally Page 118
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estimated repayment of Other Long-term Liabilities. The table below shows the CFR, together with the expected debt position over the period, which is termed the Operational Boundary. 2025-26 CFR and Operational Boundary for External Debt Original Revised £m £m Opening Capital Financing Requirement 360 360 Closing Capital Financing Requirement 394 396 Net Movement in CFR 34 36 Prudential Indicator – the Operational Boundary for External Debt Borrowing 293 282 Other Long-term Liabilities* 101 114 Total Debt (year-end position) 394 396 * Includes on balance sheet PPP and lease arrangements recognised under IFRS 16. Limits to Borrowing Activity 5.3.7 The first key control over the treasury activity is a Prudential Indicator to ensure that, over the medium term, net borrowing (borrowings less investments) will only be for a capital purpose. Gross external borrowing should not, except in the short term, exceed the total of CFR in the preceding year plus the estimates of any additional CFR for 2025-26 and the next two financial years. 2025-26 Estimated Debt against CFR Original Revised £m £m Borrowing 220 187 Other Long-term Liabilities* 101 102 Total Debt 321 289 CFR (year-end position) 394 396 Under / (Over) Borrowing 73 107 * Includes on balance sheet PPP and lease arrangements recognised under IFRS 16. 5.3.8 The level of ‘under-borrowing’ outlined in the table above reflects the level of internal borrowing, as described in paragraph 5.4.5. 5.3.9 A further Prudential Indicator controls the overall level of borrowing. This is the Authorised Limit, representing the limit, beyond which borrowing is prohibited and needs to be set and revised by Members. It is the expected maximum Page 119
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borrowing need with some headroom for short-term day to day cash flow management requirements. 2025-26 Authorised Limit for External Debt Original Revised £m £m Borrowing 298 287 Other Long-term Liabilities* 104 117 Total Debt 402 404 * Includes on balance sheet PPP and lease arrangements recognised under IFRS 16. 5.4 Borrowing Activity 5.4.1 PWLB loan principal of £0.840m has been repaid in the year to 30 September 2025, with a further £0.840m due to be repaid by 31 March 2026. These repayments of principal relate to a 10-year PWLB loan (original principal £21m), which was taken on a fixed Equal Instalments of Principal (EIP) basis. All other PWLB loans will be repayable on maturity. 5.4.2 The authority has one outstanding market or LOBO loan for £5.255m, at an interest rate of 4.75%, maturing 2048, with call dates every 6 months. This loan was not recalled at the 22 June 2025 call date. There is potential for this loan to be recalled before the end of the financial year, at the next call date of 22 December 2025. 5.4.3 New PWLB long-term borrowing of £20m has been undertaken during the year to 30 September 2025, providing an element of certainty in respect of funding the underlying borrowing requirement for capital. With long-term borrowing rates relatively high but forecast to steadily fall over the next few years, new borrowing has been taken on a relatively short-term basis. Details of the new loan taken out during the period are as follows: Lender Principal Type Interest Rate Maturity PWLB £20.000m Fixed Rate Maturity 4.69% 07/04/2028 5.4.4 Any PWLB or LOBO loans maturing during the year will ultimately require replacement borrowing to maintain the council’s cashflow position. In addition, the council will continue to actively monitor potential restructuring opportunities, in order to generate savings in interest costs or to improve the balance of the loan debt maturity profile. 5.4.5 While there is an underlying need to borrow in respect of the Capital Financing Requirement and the replacement of maturing debt, this may involve arranging short or long-term loans from external PWLB or market sources; or borrowing from internal reserve fund balances on a temporary basis, dependent on fund balance forecasts. Although an element of new external borrowing has been undertaken during the year to 30 September 2025, the significant level of Page 120
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internal reserve fund balances held by the council has provided an opportunity to largely defer new external borrowing. The table at paragraph 5.3.7 shows the extent to which the council has utilised internal funds in lieu of borrowing. This is a prudent and cost-effective approach in the current economic climate but will require ongoing monitoring and review. 5.4.6 As at 30 September 2025, the council’s external loan debt totalled £148.968m, as summarised in the table below. External Debt as at 30 September 2025 Amount £000 Annual Average Interest Rate Share of Total Debt Public Works Loans Board 143,357 4.50% 96.23% Market Loans (LOBO) 5,255 4.75% 3.53% Temporary Loans* 356 3.56% 0.24% Total Debt 148,968 4.50% 100.00% *This represents short-term borrowing from various institutions. 5.5 Debt Rescheduling 5.5.1 Debt repayment and rescheduling opportunities are considered on an ongoing basis, either to deliver savings in interest costs or to improve the debt maturity profile, at minimum risk. No debt repayments or rescheduling has been undertaken in the current financial year to 30 September 2025, however, this will continue to be monitored in the context of changing market conditions. 5.6 Annual Investment Strategy Review 5.6.1 In accordance with the CIPFA Treasury Management Code of Practice, the council’s approved Annual Investment Strategy sets out the council’s investment priorities as being: • Security of capital • Liquidity • Yield 5.6.2 The authority will aim to achieve the optimum return (yield) on its investments, commensurate with proper levels of security and liquidity, and the council’s risk appetite. The risk appetite of the council is low, prioritising security and liquidity. In the current economic climate, it is considered appropriate to keep investments short term, to cover cash flow needs, but also to seek out value available in periods of up to 12 months with high credit quality financial institutions, using the MUFG Corporate Markets suggested creditworthiness approach, including a minimum sovereign credit rating and Credit Default Swap (CDS) overlay information. 5.6.3 As outlined within the approved Annual Investment Strategy 2025-26, investment rates were forecast to fall during the first half of 2025-26, which they did, and expectations are that gradual but continuing reductions will follow over the next two financial years. Page 121
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Creditworthiness 5.6.4 The UK’s sovereign rating has proven robust through the first half of 2025-26. The UK Government is expected to outline in detail its fiscal proposals in the budget scheduled for 26 November 2025. Investment Counterparty Criteria 5.6.5 The current investment counterparty selection criteria, approved within the Strategy, continues to meet the requirements of the treasury management function. 5.7 Investment Activity 5.7.1 The council’s Section 95 Officer confirms that the principles of the Annual Investment Strategy have been adhered to. During the year to 30 September 2025, all investments have been made in line with the approved limits for specific investment instruments, and in accordance with the creditworthiness approach. 5.7.2 Details of the council’s investments held as at 30 September 2025, totalling £67.579m, are summarised in the table below. Counterparty Maturity Amount £000 Intere st Rate % Clydesdale Bank Instant Access 379 3.90% Fixed Deposits: ANZ Banking Group 10/11/2025 15,000 4.36% Al Rayan Bank 20/11/2025 5,000 4.40% DBS Bank 26/11/2025 5,000 4.13% Qatar National Bank 27/11/2025 5,000 4.29% Local Authority to Local Authority 16/02/2026 5,000 4.20% Money Market Funds: Federated Call Account 15,000 4.09% LGIM Stirling Liquidity fund Call Account 15,000 4.11% Aviva Call Account 2,200 4.10% Total 67,579 4.20% 5.7.3 The weighted average rate of return on investments held during the year to 30 September 2025 was 4.23%, with an average investment duration of 17 days. This compares to an average benchmark SONIA overnight rate of 4.19% over the first half of the year, while Bank Rate was lowered during the period from 4.50% to 4.25% in May, and then to 4.00% in August. Page 122
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5.7.4 The council is part of an Investment Benchmarking group, a service provided by MUFG Corporate Markets, which provides monthly Investment Analysis reports. This analysis compares the authority’s investment holdings and returns to the other Scottish public bodies in the group, and to Scottish Unitary Authorities as a whole. When making investment decisions, the council prioritises security and liquidity in that order but, when the investment options available are well within the parameters set out in the council’s Investment Strategy, officers will also seek to maximise yield. The council’s investments continue to perform well and above the benchmarks provided. 5.8 Compliance with Treasury and Prudential Limits 5.8.1 It is a statutory duty for the authority to determine and keep under review the affordable capital expenditure limits. In the current financial year to 30 September 2025, the authority has operated within the Treasury and Prudential Limits set out within the approved Treasury Management Strategy for 2025-26. All treasury management operations have also been conducted in full compliance with the authority's Treasury Management Practices. 5.8.2 It has been necessary to revise the Prudential Indicators to reflect updated capital planning assumptions and the adoption of IFRS 16 in respect of accounting for leases and lease type arrangements. The Section 95 Officer confirms that no difficulties are envisaged in complying with the Treasury and Prudential Limits, as revised by this report, for the remainder of the financial year. 6.0 CONCLUSION 6.1 All borrowing and investment activity during the period 1 April to 30 September 2025 has been undertaken in accordance with the approved 2025-26 Treasury Management Strategy and Annual Investment Strategy and the authority has operated within the treasury and prudential limits set out therein. 6.2 During the year to 30 September, the authority has continued to maintain an under-borrowed position. Whilst an element of new PWLB borrowing has been undertaken during the year to date, providing a degree of budget certainty, the significant level of internal reserve fund balances has provided an opportunity to largely defer new external borrowing, whilst also minimising exposure to investment risk. This borrowing strategy will require to be regularly reviewed to achieve optimum value and minimise risk exposure in the longer term. 6.3 Since approval of the 2025-26 Treasury Management Strategy in February 2025, capital planning assumptions have been updated and a new accounting standard, IFRS 16 in respect of accounting for leases has been adopted. As such, it has been necessary to revise the Prudential Indicators set out within the approved strategy. Page 123
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7.0 IMPLICATIONS 7.1 Policy - None 7.2 Financial – Provides an update on 2025-26 treasury management activity and the approved strategy 7.3 Legal - None 7.4 HR - None 7.5 Customer Service 7.6 Risk – Provides an overview of treasury management and investment risk 7.7 Climate Change - None 7.8 Fairer Scotland Duty - None 7.9 Equalities - protected characteristics - None 7.10 Consumer Duty - None 7.11 Island Communities – None 7.12 Children’s Rights and Wellbeing - None Kirsty Flanagan Executive Director/Section 95 Officer 21 November 2025 Councillor Ross Moreland, Policy Lead for Finance and Commercial Services For further information contact: Carolyn Earl, Head of Financial Services (Consultant) Carolyn.Earl@argyll-bute.gov.uk APPENDICES Appendix 1 – MUFG Economic and Interest Rate Update Page 124
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APPENDIX 1 Economics and Interest Rates Economics Update • The first half of 2025/26 saw: - A 0.3% pick up in GDP for the period April to June 2025. More recently, the economy flatlined in July, with higher taxes for businesses restraining growth. - The 3m/yy rate of average earnings growth excluding bonuses has fallen from 5.5% to 4.8% in July. - CPI inflation has ebbed and flowed but finished September at 3.8%, whilst core inflation eased to 3.6%. - The Bank of England cut interest rates from 4.50% to 4.25% in May, and then to 4% in August. - The 10-year gilt yield fluctuated between 4.4% and 4.8%, ending the half year at 4.70%. • From a GDP perspective, the financial year got off to a bumpy start with the 0.3% m/m fall in real GDP in April as front-running of US tariffs in Q1 (when GDP grew 0.7% on the quarter) weighed on activity. Despite the underlying reasons for the drop, it was still the first fall since October 2024 and the largest fall since October 2023. However, the economy surprised to the upside in May and June so that quarterly growth ended up 0.3% q/q. Nonetheless, the 0.0% m/m change in real GDP in July will have caused some concern, with the hikes in taxes for businesses that took place in April this year undoubtedly playing a part in restraining growth. The weak overseas environment is also likely to have contributed to the 1.3% m/m fall in manufacturing output in July. That was the second large fall in three months and left the 3m/3m rate at a 20-month low of -1.1%. The 0.1% m/m rise in services output kept its 3m/3m rate at 0.4%, supported by stronger output in the health and arts/entertainment sectors. Looking ahead, ongoing speculation about further tax rises in the Autumn Budget on 26 November will remain a drag on GDP growth for a while yet. GDP growth for 2025 is forecast by Capital Economics to be 1.3%. • Sticking with future economic sentiment, the composite Purchasing Manager Index for the UK fell from 53.5 in August to 51.0 in September. The decline was mostly driven by a fall in the services PMI, which declined from 54.2 to 51.9. The manufacturing PMI output balance also fell, from 49.3 to 45.4. That was due to both weak overseas demand (the new exports orders balance fell for the fourth month in a row) and the cyber-attack-induced shutdown at Jaguar Land Rover since 1 September reducing car production across the automotive supply chain. The PMIs suggest tepid growth is the best that can be expected when the Q3 GDP numbers are released. • Turning to retail sales, and the 0.5% m/m rise in volumes in August was the third such rise in a row and was driven by gains in all the major categories except fuel sales, which fell by 2.0% m/m. Sales may have been supported by Page 125
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APPENDIX 1 the warmer-than-usual weather. If sales were just flat in September, then in Q3 sales volumes would be up 0.7% q/q compared to the 0.2% q/q gain in Q2. • With the November Budget edging nearer, the public finances position looks weak. Public net sector borrowing of £18.0bn in August means that after five months of the financial year, borrowing is already £11.4bn higher than the OBR forecast at the Spring Statement in March. The overshoot in the Chancellor’s chosen fiscal mandate of the current budget is even greater with a cumulative deficit of £15.3bn. All this was due to both current receipts in August being lower than the OBR forecast (by £1.8bn) and current expenditure being higher (by £1.0bn). Over the first five months of the financial year, current receipts have fallen short by a total of £6.1bn (partly due to lower-than-expected self- assessment income tax) and current expenditure has overshot by a total of £3.7bn (partly due to social benefits and departmental spending). Furthermore, what very much matters now is the OBR forecasts and their impact on the current budget in 2029/30, which is when the Chancellor’s fiscal mandate bites. As a general guide, Capital Economics forecasts a deficit of about £18bn, meaning the Chancellor will have to raise £28bn, mostly through higher taxes, if she wants to keep her buffer against her rule of £10bn. • The weakening in the jobs market looked clear in the spring. May’s 109,000 m/m fall in the PAYE measure of employment was the largest decline (barring the pandemic) since the data began and the seventh in as many months. The monthly change was revised lower in five of the previous seven months too, with April’s 33,000 fall revised down to a 55,000 drop. More recently, however, the monthly change was revised higher in seven of the previous nine months by a total of 22,000. So instead of falling by 165,000 in total since October, payroll employment is now thought to have declined by a smaller 153,000. Even so, payroll employment has still fallen in nine of the ten months since the Chancellor announced the rises in National Insurance Contributions (NICs) for employers and the minimum wage in the October Budget. The number of job vacancies in the three months to August stood at 728,000. Vacancies have now fallen by approximately 47% since its peak in April 2022. All this suggests the labour market continues to loosen, albeit at a declining pace. • A looser labour market is driving softer wage pressures. The 3m/yy rate of average earnings growth excluding bonuses has fallen from 5.5% in April to 4.8% in July. The rate for the private sector slipped from 5.5% to 4.7%, putting it on track to be in line with the Bank of England’s Q3 forecast (4.6% for September). • CPI inflation fell slightly from 3.5% in April to 3.4% in May, and services inflation dropped from 5.4% to 4.7%, whilst core inflation also softened from 3.8% to 3.5%. More recently, though, inflation pressures have resurfaced, although the recent upward march in CPI inflation did pause for breath in August, with CPI inflation staying at 3.8%. Core inflation eased once more too, from 3.8% to 3.6%, and services inflation dipped from 5.0% to 4.7%. So, we finish the half year in a similar position to where we started, although with food inflation rising to an 18-month high of 5.1% and households’ expectations for inflation standing Page 126
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APPENDIX 1 at a six year high, a further loosening in the labour market and weaker wage growth may be a requisite to UK inflation coming in below 2.0% by 2027. • An ever-present issue throughout the past six months has been the pressure being exerted on medium and longer dated gilt yields. The yield on the 10-year gilt moved sideways in the second quarter of 2025, rising from 4.4% in early April to 4.8% in mid-April following wider global bond market volatility stemming from the “Liberation Day” tariff announcement, and then easing back as trade tensions began to de-escalate. By the end of April, the 10-year gilt yield had returned to 4.4%. In May, concerns about stickier inflation and shifting expectations about the path for interest rates led to another rise, with the 10- year gilt yield fluctuating between 4.6% and 4.75% for most of May. Thereafter, as trade tensions continued to ease and markets increasingly began to price in looser monetary policy, the 10-year yield edged lower, and ended Q2 at 4.50%. • More recently, the yield on the 10-year gilt rose from 4.46% to 4.60% in early July as rolled-back spending cuts and uncertainty over Chancellor Reeves’ future raised fiscal concerns. Although the spike proved short lived, it highlighted the UK’s fragile fiscal position. In an era of high debt, high interest rates and low GDP growth, the markets are now more sensitive to fiscal risks than before the pandemic. During August, long-dated gilts underwent a particularly pronounced sell-off, climbing 22 basis points and reaching a 27- year high of 5.6% by the end of the month. While yields have since eased back, the market sell-off was driven by investor concerns over growing supply- demand imbalances, stemming from unease over the lack of fiscal consolidation and reduced demand from traditional long-dated bond purchasers like pension funds. For 10-year gilts, by late September, sticky inflation, resilient activity data and a hawkish Bank of England have kept yields elevated over 4.70%. • The FTSE 100 fell sharply following the “Liberation Day” tariff announcement, dropping by more than 10% in the first week of April - from 8,634 on 1 April to 7,702 on 7 April. However, the de-escalation of the trade war coupled with strong corporate earnings led to a rapid rebound starting in late April. As a result, the FTSE 100 closed Q2 at 8,761, around 2% higher than its value at the end of Q1 and more than 7% above its level at the start of 2025. Since then, the FTSE 100 has enjoyed a further 4% rise in July, its strongest monthly gain since January and outperforming the S&P 500. Strong corporate earnings and progress in trade talks (US-EU, UK-India) lifted share prices and the index hit a record 9,321 in mid-August, driven by hopes of peace in Ukraine and dovish signals from Fed Chair Powell. September proved more volatile and the FTSE 100 closed Q3 at 9,350, 7% higher than at the end of Q1 and 14% higher since the start of 2025. Future performance will likely be impacted by the extent to which investors’ global risk appetite remains intact, Fed rate cuts, resilience in the US economy, and AI optimism. A weaker pound will also boost the index as it inflates overseas earnings. MPC meetings: 8 May, 19 June, 7 August, 18 September 2025 • There were four Monetary Policy Committee (MPC) meetings in the first half of the financial year. In May, the Committee cut Bank Rate from 4.50% to 4.25%, while in June policy was left unchanged. In June’s vote, three MPC members (Dhingra, Ramsden and Taylor) voted for an immediate cut to 4.00%, citing Page 127
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APPENDIX 1 loosening labour market conditions. The other six members were more cautious, as they highlighted the need to monitor for “signs of weak demand”, “supply-side constraints” and higher “inflation expectations”, mainly from rising food prices. By repeating the well-used phrase “gradual and careful”, the MPC continued to suggest that rates would be reduced further. • In August, a further rate cut was implemented. However, a 5-4 split vote for a rate cut to 4% laid bare the different views within the Monetary Policy Committee, with the accompanying commentary noting the decision was “finely balanced” and reiterating that future rate cuts would be undertaken “gradually and carefully”. Ultimately, Governor Bailey was the casting vote for a rate cut but with the CPI measure of inflation expected to reach at least 4% later this year, the MPC will be wary of making any further rate cuts until inflation begins its slow downwards trajectory back towards 2%. • The Bank of England does not anticipate CPI getting to 2% until early 2027, and with wages still rising by just below 5%, it was no surprise that the September meeting saw the MPC vote 7-2 for keeping rates at 4% (Dhingra and Taylor voted for a further 25bps reduction). • The Bank also took the opportunity to announce that they would only shrink its balance sheet by £70bn over the next 12 months, rather than £100bn. The repetition of the phrase that “a gradual and careful” approach to rate cuts is appropriate suggests the Bank still thinks interest rates will fall further but possibly not until February, which aligns with both our own view and that of the prevailing market sentiment. Interest Rate Forecasts The Authority has appointed MUFG Corporate Markets as its treasury advisors and part of their service is to assist the Authority to formulate a view on interest rates. The PWLB rate forecasts below are based on the Certainty Rate (the standard rate minus 20bps) which has been accessible to most authorities since 1 November 2012. MUFG Corporate Markets’ latest forecast on 11 August sets out a view that short, medium and long-dated interest rates will fall back over the next year or two, although there are upside risks in respect of the stickiness of inflation and a continuing tight labour market, as well as the size of gilt issuance. MUFG Corporate Markets Interest Rate View 11.08.25 Sep-25 Dec-25 Mar-26 Jun-26 Sep-26 Dec-26 Mar-27 Jun-27 Sep-27 Dec-27 Mar-28 Jun-28 Sep-28 BANK RATE 4.00 4.00 3.75 3.75 3.50 3.50 3.50 3.50 3.25 3.25 3.25 3.25 3.25 3 month ave earnings 4.00 4.00 3.80 3.80 3.50 3.50 3.50 3.50 3.30 3.30 3.30 3.30 3.30 6 month ave earnings 4.00 3.90 3.70 3.70 3.50 3.50 3.50 3.50 3.30 3.30 3.40 3.40 3.40 12 month ave earnings 4.00 3.90 3.70 3.70 3.50 3.50 3.50 3.50 3.30 3.40 3.50 3.60 3.60 5 yr PWLB 4.80 4.70 4.50 4.40 4.30 4.30 4.30 4.20 4.20 4.20 4.20 4.10 4.10 10 yr PWLB 5.30 5.20 5.00 4.90 4.80 4.80 4.80 4.70 4.70 4.70 4.70 4.60 4.60 25 yr PWLB 6.10 5.90 5.70 5.70 5.50 5.50 5.50 5.40 5.40 5.30 5.30 5.30 5.20 50 yr PWLB 5.80 5.60 5.40 5.40 5.30 5.30 5.30 5.20 5.20 5.10 5.10 5.00 5.00 Page 128
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Audit & Scrutiny Committee Work Plan 2025 This is an outline plan to facilitate forward planning of reports to the Audit & Scrutiny Committee Report Lead Service Regularity 16 December 2025 Reports to Committee Services by 21 November 2025 Internal Audit and Counter Fraud Summary of Activities Chief Internal Auditor Quarterly Internal and External Audit Report Follow Up Chief Internal Auditor Quarterly Internal Audit Reports to Audit and Scrutiny Committee 2025/26 Chief Internal Auditor Quarterly Verbal Update by Chair(s) of Scrutiny Panel Chair and Vice Chair of Audit & Scrutiny Committee Quarterly Performance Reporting Update (to include reference to LGBF) Chief Executive/Head of Customer Support Services/HR & OD Manager – Carolyn Cairns/Jennifer Coyle Annual Council Annual Report 2025/26 Head of Customer Support Services Annual Annual Council Business Plan 2024-25 Outcomes Head of Customer Support Services Annual Treasury Management Strategy and Annual Investment Strategy – Mid-year Review Report 2025/26 Head of Financial Services Annual Special Meeting – 26 January 2026 Reports to Committee Services by 16 January 2026 Annual Auditors Report Forvis Mazars – Mark Outterside Annual Draft Thematic Review Forvis Mazars – Mark Outterside Annual 2024-25 Audited Annual Accounts Forvis Mazars – Mark Outterside/Section 95 Officer/Head of Financial Services Annual 12 March 2026 Reports to Committee Services by 16 February 2026 Internal Audit and Counter Fraud Summary of Activities Chief Internal Auditor Quarterly Internal and External Audit Report Follow Up Chief Internal Auditor Quarterly Internal Audit Reports to Audit and Scrutiny Committee 2025/26 Chief Internal Auditor Quarterly Verbal Update by Chair(s) of Scrutiny Panel Chair and Vice Chair of Audit & Scrutiny Committee Quarterly External Audit Progress Report Forvis Mazars – Mark Outterside Quarterly RIPSA Annual Report Governance and Risk Manager Annual Internal Audit 2025/26 Plan and Internal Audit Strategy 2025-2028 Chief Internal Auditor Annual 2025/26 Unaudited Annual Accounts Preparation Plan and Timetable Head of Financial Services Annual 2025-26 Treasury Management Update as at 31 December 2025 Head of Financial Services Annual 2026-27 Treasury Management Strategy and Annual Investment Strategy Head of Financial Services Annual Page 129 Agenda Item 9
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Audit & Scrutiny Committee Work Plan 2025 Internal Audit Charter and Internal Audit Manual Chief Internal Auditor Annual Scrutiny Manual and Framework Annual Review Chief Internal Auditor Annual 11 June 2026 Reports to Committee Services by 18 May 2026 Internal Audit and Counter Fraud Summary of Activities Chief Internal Auditor Quarterly Internal and External Audit Report Follow Up Chief Internal Auditor Quarterly Internal Audit Reports to Audit and Scrutiny Committee 2026/27 Chief Internal Auditor Quarterly Verbal Update by Chair(s) of Scrutiny Panel Chair and Vice Chair of Audit & Scrutiny Committee Quarterly External Audit Progress Report Forvis Mazars – Mark Outterside Quarterly Internal Audit 2025-26 Annual Report Chief Internal Auditor Annual Scrutiny report on the Monitoring and Managing of Complaints Chief Internal Auditor (Scrutiny Panel) from March A&SC Annual Annual Audit Plan for year ending 31 March 2026 Forvis Mazars – Mark Outterside Annual Local Government in Scotland – Financial Bulletin 2024/25 (Accounts Commission publication – timing will be subject to change, as this is dependent on publication date) Head of Financial Services Annual Local Government Benchmarking Framework Report Head of Customer Support Services/OD Project Manager (Chris Carr) Annual Unaudited Annual Accounts for year ending 31 March 2026 Head of Financial Services Annual Treasury Management Annual Report 2025/26 Head of Financial Services Annual Statement of Governance and Internal Control Governance, Risk and Safety Manager Annual XX September 2026 Reports to Committee Services by XX August 2026 Internal Audit and Counter Fraud Summary of Activities Chief Internal Auditor Quarterly Internal and External Audit Report Follow Up Chief Internal Auditor Quarterly Internal Audit Reports to Audit and Scrutiny Committee 2026/27 Chief Internal Auditor Quarterly External Audit Progress Report Forvis Mazars – Mark Outterside Quarterly Verbal Update by Chair(s) of Scrutiny Panel Chair and Vice Chair of Audit & Scrutiny Committee Quarterly 2026-27 Treasury Management Update as at 30 June 2026 Interim Head of Financial Services Annual PSIAS Self-Assessment Chief Internal Auditor Annual Corporate Complaints Annual Report 2025-26 Governance, Risk and Safety Manager Annual Freedom of Information Annual Report 2025-26 Governance, Risk and Safety Manager Annual Audit & Scrutiny Committee 2025/26 Annual Report Audit & Scrutiny Committee Chair Annual Strategic Risk Assurance Mapping Chief Internal Auditor Annual Strategic Risk Register Update Chief Executive Annual Page 130
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE CUSTOMER SUPPORT SERVICES 16 DECEMBER 2025 ANNUAL COUNCIL BUSINESS PLAN 2024-25 OUTCOMES 1.0 EXECUTIVE SUMMARY In June 2023 the Council agreed a Corporate Plan covering the years 2023 – 2027. It was intended that there would be annual updates on the progress against outcomes in the form of Annual Business Plans and a new Business Plan created for each year of the life of the Corporate Plan. As the Administration changed, the priorities were reviewed and a new Corporate Plan was developed to align with these, coupled with a new suite of Annual Business Plans. This report provides an update on progress for the Annual Business Plan 2024 – 2025 which closes off the previous corporate priorities reporting, for the Committee’s information. The report recommends that the Committee: • Notes the progress made against the outcomes specified in the 2024 – 2025 Annual Business Plan and • Notes that an Annual Business Plan for 2025 - 2026 will be created in regard to the current Council priorities Page 131 Agenda Item 10
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE CUSTOMER SUPPORT SERVICES 16 DECEMBER 2025 ANNUAL COUNCIL BUSINESS PLAN 2024-25 OUTCOMES 2.0 INTRODUCTION 2.1 In June 2023 the Council agreed a Corporate Plan covering the years 2023 – 2027. It was intended that there would be annual updates on the progress against outcomes in the form of Annual Business Plans and a new Business Plan created for each year of the life of the Corporate Plan. As the Administration changed, the priorities were reviewed and a new Corporate Plan was developed to align with these, coupled with a new suite of Annual Business Plans. This report provides an update on progress for the Annual Business Plan 2024 – 2025 which closes off the previous corporate priorities reporting, for the Committee’s information. The report was presented to Council on 26 November 2025. 3.0 RECOMMENDATIONS 3.1 It is recommended that the Committee: 3.1.1 Notes the progress made against the outcomes specified in the 2024 – 2025 Annual Business Plan and 3.1.2 Notes that an Annual Business Plan for 2025 - 2026 will be created in regard to the current Council priorities 4.0 DETAIL 4.1 Members agreed the Council priorities at its meeting in November 2022. Those priorities were captured within the Corporate Plan for the period 2023 – 2027. The Administration changed during the life of this plan and a new set of priorities were agreed in September 2024. These were incorporated into a new Corporate Plan, agreed by Committee in May 2025. Consequently, the previous Annual Business Plan outcomes were carried forward to the financial year 2024 – 2025. Details on activity for the financial year 2024 - 2025 against those priorities are set out in the Council’s Annual Business Plan Annual Update 2024 – 2025 which brings more focus and scrutiny on the delivery and performance of the organisation against its priorities. Page 132
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4.2 An assessment against the performance contained within the Business Plan for 2024 – 2025 is appended. Where available, the updates cover the period to October 2025 although the key reporting period covered by the Annual Business Plan is the financial year 2024 – 2025. This was submitted to Council on 26 November 2025 as part of an annual cycle of review, correction and implementation. The report and update is now also submitted to Audit and Scrutiny Committee. 5.0 CONCLUSION 5.1 Members are asked to review the update on progress for the second year of the Council’s Corporate Plan, 2024 – 2025 and note progress against outcomes identified, in consideration of the Council’s current priorities. 6.0 IMPLICATIONS 6.1 Policy - None arising directly from this report. 6.2 Financial - None arising directly from this report. 6.3 Legal - None arising directly from this report. 6.4 HR - None arising directly from this report. 6.5 Customer Service - None arising directly from this report however outcomes in the Business Plan may impact. These have been addressed in Integrated Impact Assessments for relevant activities. 6.6 Risk - None arising directly from this report. 6.7 Climate Change - None arising directly from this report however outcomes in the Business Plan may impact. These have been addressed in Integrated Impact Assessments for relevant activities. 6.8 Fairer Scotland Duty - An EqSEIA for the Corporate Plan 2023 - 2027 is available on the Council website. 6.9 Equalities - protected characteristics Socio-economic - Duty None arising directly from this report however outcomes in the Business Plan may impact. These have been addressed in Integrated Impact Assessments for relevant activities. 6.10 Consumer Duty - None arising directly from this report however outcomes in the Business Plan may impact. These have been addressed in Integrated Impact Assessments for relevant activities. Page 133
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6.11 Island Communities - None arising directly from this report however outcomes in the Business Plan may impact. These have been addressed in Integrated Impact Assessments for relevant activities. 6.12 Children’s Rights and Wellbeing - None arising directly from this report however outcomes in the Business Plan may impact. These have been addressed in Integrated Impact Assessments for relevant activities. Pippa Milne, Chief Executive Jim Lynch, Council Leader 28 October 2025 For further information contact: Pippa Milne, Chief Executive, pippa.milne@argyll-bute.gov.uk Jane Fowler, Head of Customer Support Services, jane.fowler@argyll-bute.gov.uk Jennifer Coyle, Senior HR Business Partner, jennifer.coyle@argyll-bute.gov.uk APPENDICES Appendix 1 Annual Business Plan 2024 to 2025 Annual Update October 2025 Page 134
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Argyll and Bute Council Annual Business Plan 2024 – 2025 Update Report Page 135
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Council Priorities Action Plan 2024 - 2025 Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 People and places, our core business as a council Attaining and achieving at all stages; we will improve outcomes for our children and young people Improve educational attainment, achievement and outcomes for our young people within Argyll and Bute to Scotland’s upper quartile. • Continue to challenge and support schools proportionately. Further refine criteria for support and ensure increased focus on secondary schools. • Continue to work in close partnership with Developing the Young Workforce (DYW) team to ensure young people successfully develop the skills for life and work required to attain sustained positive destinations post-school. • Continue to track young people’s pathways within school and in the period after leaving school, to ensure appropriate support, guidance and opportunities are in place to gain and sustain positive destinations. • Improved levels of attainment across the Senior Phase where attainment is in line with national data. • Extended range of learning pathways on offer for all learners. • 96% of 16–19- year-olds are in Education, Training or Employment. • We are continuing to strengthen our approaches to supporting and challenging secondary schools to raise levels of attainment for all. All schools now have more robust tracking systems in place which are leading to improvement. A few schools are continuing to receive intensive support around improving attainment. In 2 (out of 3) of these schools, senior phase predictions for August 2025 are showing signs of some improvement. Page 136
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 • In 2024/25, Education has further developed its work with Community Learning to introduce an increased range of wider achievement opportunities across secondary schools. As a result, 614 young people have engaged across seven accredited awards, while 718 young people have accessed eight non-accredited learning activities, including dedicated primary-secondary transition support. • Skills Development Scotland Annual Participation Measure published Aug 24: 94.3% of 16-19 year- olds in Education, Training or Employment. Page 137
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Educational Attainment and Wider Achievement – Developing the use of all the available data and intelligence on each of our educational establishments to focus on and drive improvement, achieving our stretch aims (goals to improve opportunities and outcomes for young people) as agreed with the Scottish Government. • Strengthen focus on learning, teaching and assessment with increased emphasis on secondary sector. Continue to build staff capacity in the interrogation and use of data for improvement. • Develop further use of range of data dashboards in order to provide accessible and meaningful data for all schools and settings. • Deliver targeted and universal literacy and numeracy support for establishments in order to raise attainment with specific focus on pupils residing in Quintile 1. • Continue to support schools to rigorously track and monitor pupil progress and plan measurable interventions and initiatives to raise attainment for all whilst closing the poverty related attainment gap. • Stretch aims are achieved: Literacy 73.5%, Numeracy 80.5% School Leavers with 1 or more pass at SCQF Level 5 92.25%. • School Leavers with 1 or more pass at SCQF Level 6 67.75%. Improved levels of attainment across the Senior Phase where attainment is in line with national data. • Stretch Aims 23/24: ACEL: Literacy - 72.2% (up from 67.7%) Numeracy - 80.1% (up from 76.4%) Based on recent ACEL attainment data tracking, we are on track to achieve our overall stretch aims for P1/4/7 at June 2025. • School Leavers: School Leavers with 1 or more pass at SCQF Level 5 - 85.7% School Leavers with 1 or more pass at SCQF Level 6 - 66.7% (Amongst S6 leavers only, the percentage leaving with 1+ At level 6 increased from 85.5% to 90.6%. Increase in S4 leaving rates created downward pressure on cohort performance). Page 138
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Developing a broader curriculum offer to augment current opportunities with a range of wider achievement awards and accreditations. This will have a positive impact on leaver destinations through inclusive, skills - based programmes in each secondary school. • Schools will be supported and challenged to develop their curricula, underpinned by a robust rationale taking account of place- based resources and local labour market data. • Support secondary schools via UK Shared Prosperity Funding to ensure accredited wider achievement opportunities exist for every pupil at each stage of their secondary education. • Strengthen partnerships with Community Learning, UHI Argyll and Third Sector agencies to increase wider achievement opportunities for young people at each stage of their secondary education. • Young People in every secondary school have the opportunity to engage in 1 accredited wider achievement programme at each stage of their secondary education. An extended range of pathways are in place and opportunities for partnership working are maximised. • All secondary schools are now in a position to offer young people at least 1 wider achievement opportunity. • The use of UKSPF has been monitored robustly to ensure best value and appropriate use. All schools are on track to have utilised this funding by the deadline. In addition, we will receive an allocation next session. We were initially informed that this funding stream was coming to an end. • Community Learning (CL) have extended partnership with secondary schools. CL active in all secondary schools offering wider achievement/skills development courses. To date in 2024-25, there have been 198 Page 139
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 accreditations. 359 young people engaged in either accredited or non-accredited wider achievement activities. • 39 Flexible Learning Plans (FLPs) are in place across secondary schools to support disengaged learners as a result of partnerships with employers and UHI Argyll (2023-24 34 FLPs) • Partnerships between schools and employers have continued to increase in 2024-25. As a result, a total of 380 work placements have supported young people to plan their individual vocational pathways. Page 140
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Continuing to promote the teaching and use of Gaelic as set out in the council’s emerging Gaelic Plan for 2023. • Education Officer and Principal Teacher will continue to support and challenge establishments to build staff capacity and help to establish Gaelic as an L2 or L3. • Continue to signpost schools to ESgoil support and support and materials from other agencies such as Education Scotland and Storlann. Continue to work in partnership with Ed Scot to challenge and support schools. EO and PT will continue to challenge and support schools to improve the quality of Gaelic Medium Education and attainment for all pupils. • Principal Teacher will continue to deliver online language lessons with colleagues from other authorities. • Number of schools offering Gaelic as L2 or L3 to 80% (dependent on Scottish Government). • Through the work of the PT, including the additional development of Live Lessons, 71% of primary schools in A&B are currently delivering Gaelic as L2 or L3. This is an increase of 3% since October 2024 when 68% of schools delivered Gaelic Learner Education. The Live Lessons support schools to continue their development of Gaelic as L3, enabling pupils to progress their learning beyond the ‘beginner’ stage. The Live Lessons enable schools to continue their delivery of Gaelic as L2 and L3, thus supporting the Education Service to reach our target of 80% of all primary schools. • All A&B teaching staff have regular updates Page 141
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 from the PT to inform staff of educational resources and support from partners including eSgoil and Education Scotland. • Education Scotland’s Senior Education Officer (SEO) for Gaelic has visited almost all GMPE settings to support Learning Teaching and Assessment (LTA). Positive impact on pupil attainment in Gaelic Literacy is being evidenced. • Almost all GMPE settings have been trained in QI Writing strategies. This methodology is resulting in a positive impact on pupil attainment in Gaelic writing. • Almost all GMPE settings received in- person support from Page 142
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 the Furan Gaelic Centre administrator. This has had a positive impact on pupil fluency. • All GMPE practitioners now have access to the wide range of Highland Literacy Project materials in Gaelic for use in LTA. This work is starting to have a positive impact on pupil attainment in GME. Learning estate now and in the future; we will ensure our schools are effective, sustainable learning environments Progress a bid to the Scottish Government to establish a new campus on Mull. • Continue to develop the business case, undertake engagement and site selection process for a new Campus on Mull. • Robust business case in place, communities feel involved and engaged in process, site selected and plans progressed in line with identified timescales. • LEIP application was successful and was accepted to LEIP phase 3 programme in October 2023. Community engagement activities took place in September 2024 informing the project site selection. Special Council Committee meeting on March 7th agreed the preferred site Page 143
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 ‘Tobermory South’ (southern edge of Tobermory with the western boundary adjacent to the A848).A group called Mull Campus Working submitted a Judicial Review against the Council which was heard in Court of Session on 13th October. Work on the project has ceased pending outcome of JR. Develop the next generation of capital investment plan and priorities for our school estate. • Service Asset Management Plan (SAMP) for Education and delivery of Programme by Feb 2024. • All programmed work completed by the specified date and in line with the allocated capital budget. • All capital works completed on budget and to timescale to programme with notable investment in John Logie Baird Primary School and Tobermory / Hermitage ASN Units. Supporting children and young people with additional needs Page 144
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Reducing the number of children and young people who have to travel out-with the area to access services by enhancing provision where gaps currently exist. • Progress planning for and set up of four Learning Centres in areas as identified in the ASN review of 2021/22. • Continue to increase the number of staff within educational settings being CALM trained. • Continue to offer opportunities for staff to further develop their skill in meeting the needs of all learners. • Continue to Increase the number of children accessing high quality enhanced provision within Argyll and Bute. • All new Learning Centres will be operational by August 2025 with places allocated to children through the ERG allocation process. • All schools are able to access CALM training and there has been increased uptake during session 2024/2025 from the previous academic session. By June 2025, there will be an increased number of CALM trainers in Argyll and Bute. This will support educational settings in becoming CALM trained and moderate the effective application of this training. • All primary and secondary schools have been able to access CIRCLE and GIRFEC training. Page 145
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Working to improve and secure equity of specialist provision across Argyll and Bute by addressing gaps where they exist across the education estate. • Continue to progress plans accordingly including recruitment of staff. • Continue to increase the number of children accessing high quality specialist provision within Argyll and Bute. • Most new Learning Centres already have teaching staff in post prior to August 2025 opening. The remaining posts are currently being advertised. • Support staff recruitment is underway and all learning Centres are on track to be fully resourced by August 2025. • Leaders from all Learning Centres are participating in the development of a Strategic Leadership network for specialist provision. The network has identified improvement priorities and will be collaborating to develop shared understanding on effectively supporting learners and how to Page 146
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 develop high quality specialist provision appropriate for their context. Maintaining the current staffing complement who support ASN in line with our nurture stretch aim agreed with Scottish Government. • Current complement of central staff- 1 Principal Teacher and 2 Teachers will be maintained through maintaining teacher numbers. The number of schools engaging with Our Children Their Nurture Education will increase to 35. • Stretch aims are achieved: Literacy 73.5%, Numeracy 80.5% School Leavers with 1 or more pass at SCQF Level 5 92.25%.School Leavers with 1 or more pass at SCQF Level 6 67.75%.Core plus stretch aim nurture measure is 67%. • There are currently 58 settings engaged with OCTNE (52 schools and 6 ELC providers), with 12 of these settings joining during session 24/25, exceeding the stretch aim of 35 schools and reflecting a growing commitment to trauma- informed, nurture- based education.” • The current complement of central staff – 1 Principal Teacher and 2 Teachers – continues to provide targeted ASN support, aligned with the nurture stretch aim. • In session 24/25, Nurture Teachers delivered training in Boxall Profiles, Block Page 147
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Based Therapy, and PACE to staff across multiple settings, directly contributing to the professional capacity of ASN support staff. • The 5th cohort of leadership training began February 2025 with 32 participants from 22 settings, helping schools prepare for OCTNE accreditation and sustain nurturing practices at a strategic level. • Targeted nurture intervention and coaching has been delivered to 8 schools via the Coach and Consult model, strengthening the ASN support network and helping staff address SEMH needs. Roads and pathways; connecting to, from and within Argyll will be supported Page 148
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Reviewing our approach to road repair prioritisation to make the most effective use of resources in the context of budget pressures and to achieve the best possible balance in terms of strategic, operational and member input. • Implement actions to increase member input in process • Members seminar • Officers have agreed a process plan which include an annual members input for the capital roads plan of works so that a local perspective can be introduced. Members seminar took place October 2024. Initiating plans for a 20mph speed limit by working in partnership, and in line with national legislation, on the rollout and delivery of a 20mph limit where that will work best for our communities. • Review potential for implementing 20mph speed limits in accordance with national priorities. • Number of engagement sessions • Number of 20mph schemes introduced • Officer appointed to post funded by Scottish Government and is developing a programme of engagement with stakeholders including elected members and community groups. Completing a review of parking and traffic management/enforcem ent to reshape arrangements that reflect community needs and ambitions. • TRO review in line with members requests to support their communities’ needs. • Report through December 2025 EDI Committee to obtain agreement on proposed review and methodology. • Report to EDI committee on 18 • Report through EDI Committee 18 December 2025 the proposed Traffic Regulation Orders for the whole ABC area. • TRO Business day with members October 2025 to outline Page 149
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 December 2025 to obtain agreement on proposed review and methodology • Review commences. • Start of consultation period. • Statutory consultation takes place. • TRO Business day with members . • New TROs agreed. proposed approach and obtain member feedback. Proposals now being developed to reflect this. Piers and harbours Upgrading the council’s harbour infrastructure to ensure it is capable of receiving existing and planned new ferries (including at Craignure, Fionnphort/Ruahaich, Port Askaig, Dunoon, Kilcreggan and • Iona Start work on new breakwater at Iona. o Capital dredging to improve navigational access o Replacement of the public toilet block o Slipway repairs • Craignure Complete OBC Start preparation of FBC • Campbeltown • Iona All necessary marine licences granted Tender go live for management consultant Project start • Craignure Complete OBC • Campbeltown Open new quay • Iona All necessary marine licences have been granted, including: o Rock Armour Breakwater Licence o Capital Dredging Licence o European Protected Species Licence o Basking Shark Licence. • A Seagrass Mitigation and Monitoring Plan Page 150
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Campbeltown, Tayinloan - Gigha). Open new quay was approved in July 2025, with ongoing environmental monitoring throughout construction • Site mobilisation began in March 2025. Over 120,000 tonnes of granite rock are being used, sourced from Glensanda Quarry, Ireland, and Norway. 21,000 tonnes of 1–3 tonne rock have already been delivered and placed to form the base and core of the breakwater. • The new toilet block is nearing completion, with mechanical and electrical installations underway. • Craignure • A tender for management consultants to lead this next phase is expected to go live in November 2025, with an Page 151
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 appointment anticipated in January 2026. • The cost of the project is now projected at £96 million • Gigha / Tayinloan • The ferry terminals at Gigha and Tayinloan are undergoing significant upgrades as part of Transport Scotland’s Small Vessel Replacement Project This will modernise infrastructure to support new hybrid ferries. These are two separate but coordinated projects being managed by Argyll and Bute Council with support from RPS Tetra Tech. Creating a new municipal harbour authority in Oban, ensuring that proposals are submitted to • HRO to be submitted to and agreed by Scottish Government • New HRO in place • The council has submitted a Harbour Revision Order (HRO) to Transport Scotland to establish a Municipal Page 152
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Scottish ministers as soon as possible following consideration by the Harbour Board in December 2022, and putting preparations in place to commence operations upon approval by ministers. Harbour Authority that would cover most of Oban Bay, excluding the area around the ferry terminal (which remains under CMAL). • The HRO is now with Scottish Government Ministers for consideration. When approved, Argyll and Bute Council would become the Statutory Harbour Authority for the newly defined area of Oban Bay. Seeking funding for the procurement of new council-operated vessels including Islay/Jura, Luing and Easdale. • Carry out assessment, specification and costing of new vessels. • Request funding from Scottish Government and/or explore other funding opportunities. • Secure funding for new vessels based on priority requirement. • Funding for new ferries serving Jura, Luing, and Easdale is progressing through a combination of local authority planning, regional transport partnerships, and the Scottish Government’s Small Vessel Replacement Programme (SVRP). • Jura Ferry Page 153
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 The Council is actively pursuing funding for the design and construction of a new ferry for Jura • HITRANS has committed £1.5 million to support planning and infrastructure improvements for Jura and Luing. • The Council is lobbying for full funding from the Scottish Government and exploring options for capital investment through Transport Scotland and HITRANS. • Jura, Luing, and Easdale are not included in Phase 1 of SVRP, which covers seven electric ferries for other routes (e.g., Gigha, Iona). However, future phases may include these Finalising the demand, economic impact and Page 154
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 business case assessment for the Helensburgh Pier strategy in 2023. Waste and recycling services; reduce our carbon emissions Delivering a solution that enables the council to divert its biodegradable waste from landfill, within 2026, while seeking a short-term derogation to allow the PPP contract to expire. • Identify route to market for contract to replace PPP • Develop variation to existing PPP contract to divert residual waste away from landfill • Procure off take and haulage contracts for island sites • New offtake contracts for landfill waste • End of MBT at Oban, Dunoon and Lochgilphead PPP sites • Multi disciplinary working group established with representatives of the council’s legal, procurement, financial and waste services to develop legally compliant solution to landfill ban • Agreement reached with current contractor, Biffa, to alter existing Public / Private Partnership to allow for closure of landfill sites at Dunoon and Lochgilphead, and ending of Mechanical and Biological Treatment of landfill waste • New waste disposal contract in place to Page 155
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 divert waste from MAKI and OLI to energy from waste facilities Encouraging households to increase use of recycling services to reach at least the Scottish average (with service exploring options to stretch targets where possible). • Carry out marketing and publicity campaign – e.g. Food Waste Awareness campaign, Green July (which will also include waste). • Officers review the recycling rate to see if the campaign has had an impact. • The Council worked with Zero Waste Scotland to refresh the recycling section of our website to streamline our messaging and reflect best practice. • A second social media campaign took place in June which focussed on behaviour changes which would help reduce the amount of waste going to landfill and pointed customers to supporting information, either on the council website or third-party sites. • Marketing will continue with regular posts, and campaigns, throughout the year. Housing Page 156
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Supporting the provision of over 1,000 affordable homes by 2027 (247 in 2022/23 plus at least 750 additional homes over the life of the Strategic Housing Investment Plan). • Continue to monitor housing completions and produce annual housing land audit. • Deliver 247 affordable completions in 22/23 • 107 affordable housing units were completed in 23/24 so less than the programmed delivery, but this reflects a natural variation and is the latest period for which data is available. Exploring additional options to increase the availability of all tenures of housing - mid market rents, shared equity, affordable by design and other developments - in the area. • Explore title burdens and phase 1 site investigations for possible Rural growth Deal Funded housing for sale and principal home occupancy • Complete site investigations. • Establish satisfactory title. • Phase 1 site investigations are complete. Title investigations involving Church of Scotland are ongoing. Considering the implementation of short term lets control zones to open up more housing availability. • Short-term let licensing regime and policy in place. 3308 applications received to be determined. • 100% of applications determined or deemed granted. STL applications mapped on GIS, to support consideration of planning control areas. • Draft policies being devised Page 157
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Continuing to support households to improve energy efficiency and tackle rising living costs through annual investment through and implementation of the Home Energy Efficiency Programme in Argyll and Bute. • Renew contractors and manage delivery of HEEPS:ABS programme. • Complete delivery of 24/25 HEEPS ABS allocation. • 24/25 HEEPS ABS allocation was 100% spent. Developing the opportunity for the council to become a Rural Housing Body - where it would be more directly involved in the delivery of housing or land for housing. • Council has already been awarded Rural Housing Body status. Communities; we will build and strengthen our communities as attractive, vibrant places to live, work and do business Creating area plans for all our communities, reflecting investment opportunities and local service prioritisation. • Launch Aspiring Places platform • Comprehensive support to be provided by the Community Development team to local community bodies to facilitate the development of Local Place Plans. • Evaluation of engagement of platform undertaken and reported to Policy and Resources Committee • Development of support package for communities, • Further to Members agreement in September 2024, the ‘Aspiring Places – Community Projects in Argyll and Bute’ digital platform was successfully launched in March 2025 and over 150 community Page 158
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 including webinars, master classes and a dedicated web page with links to resources, enabling communities to develop Local Place Plans. groups registered, and over 100 project proposals have been published. • An evaluation has been completed and will be reported to the Policy and Resources Committee on the 04 December 2025. • Close working between Development Planning and Community Development teams to prepare a comprehensive support page for communities developing Local Place Plans, complementing the Local Development Plan 3 process. Support to communities included master classes and webinars, development of a newsletter and community of practice. Page 159
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Seeking ways of securing more community wealth building opportunities across Argyll and Bute and supporting communities to gain maximum benefit from developments in their area. • Arrange community wealth building meeting with anchor organisations within Argyll and Bute. Share Council’s contract plan with them to determine if any collaborative opportunities, publish our contract plan on website. Share our community benefit guidance, and wishlist with them to enable best practice to be rolled out across all of Argyll and Bute public sector organisations. Invite our anchor organisation colleagues to collaborate with us on appropriate contracts/frameworks. • Contracts awarded to local suppliers (%) – Target 20%. For 2023/24 the % was 17.8%. For 2024/25 (Q1&Q2) – 18.3% As this % includes all contracts, whether a local bid was submitted or not we also report: -Tenders won by a local supplier where a local supplier has placed a bid (%) - no target. For 2023/24 the % was 59.5%. For 2024/25 (Q1&Q2) – 65.2% -Local suppliers bidding for business with the council (% of bids received) - Target 20%. For 2023/24 the % • Community wealth building event took place. A Community Wealth Building Action Plan is currently being prepare by specific partner organisations within the Argyll and Bute Community Planning Partnership aligned to the key content within the draft CWB Bill published on 20th March 2025 by the Scottish Government which was out for consultation until 23rd May 2025 on whether it should become an Act of Parliament. • Our contract plan was shared and as a result collaborative contracts are taking place with our partner organisations. Our contract plan is published on the website to allow local Page 160
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 was 15.2%. For 2024/25 (Q1&Q2) – 14.4% -Increase the number of community benefits that are delivered through contracts we award locally – no target. For 2023/24 – 74 community benefits achieved. For 2024/25 (Q1&Q2) – 31 -Local spend – no target. For 2023/24 local spend was 35.8%. For 2024/25 (Q1) – 28.4% businesses to see what we are looking to buy in the coming year ahead. Our community benefit guide has been shared with our community wealth building partners along with a link to our wishlist. Further engagement has taken place at area community planning partnership meetings. • Contracts awarded to local suppliers (%) – Target 20%. 2024/25:18.7% As this % includes all contracts, whether a local bid was submitted or not we also report: -Tenders won by a local supplier where a local supplier has placed a bid (%) - no target. 2024/25:69.8% Page 161
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 -Local suppliers bidding for business with the council (% of bids received) - Target 20%. 2024/25:13.5% -Increase the number of community benefits that are delivered through contracts we award locally – no target. 89 community benefits were delivered via our council contracts in 2024/25 compared to 74 in 2023/24 which is an increase of 15. -Local spend – no target. The total Procurement-related spend with known local suppliers in 2024/25 was £72.7m. The local procurement-related spend has increased from the previous two years, (£65.7m in 2023/24 and £60.8m in 2022/23). Page 162
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Seeking to maximise scope for community involvement and participation, including exploring the role that community transfers can play. • Argyll and Bute Community Planning Partnership to agree the actions for the ABOIP priority outcome of Community Wellbeing, which has a long-term objective to: support community cohesion, the sustainability of community services and a voice in collective decision making. • Explore the potential to have the Community Development Team work in collaboration with Estates Team to ensure effective Community Asset Transfer, dealing with requests from community groups in a timeous manner and providing comprehensive support. • An Engaging Communities Framework will be developed and launched to facilitate and support a corporate approach to community engagement, including the development of training and support materials • Members of the Community Planning and Community Development team will undertake training in Art of Hosting techniques to enable a suite of practical methods of community engagement • Community Planning Partnership agreement and endorsement of Community Wellbeing actions. • Community Asset Transfer requests will be considered and processed according to the requirements of section 5 of the Community Empowerment (Scotland) Act 2015. The Community Asset Transfer web page will be updated as required with an annual report produced and uploaded for 2024/25. • Launch of the Engaging Communities Framework with • In December 2024, the CPP agreed a set of 6 actions under the priority outcome of Community Wellbeing. • Successful trial project of Community Development team and the Estates team collaboration throughout 2024-25 ensuring the Community Asset Transfer process worked effectively ensuring requests from community groups were dealt with timeously with comprehensive support. The Community Asset Transfer web page has been updated with detailed information on the process for Community Transfer Bodies and an annual report has been produced for 2024/25. Page 163
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 to be incorporated into professional practice. appropriate training and support materials developed to enable a corporate approach. • Members of the Community Planning and Community Development team will successfully undertake training in Art of Hosting techniques, will cascade learning to the full team and will use these techniques in community engagement practice. • Engaging Communities Framework developed, launched in January 2026 with online training on LEON for staff. • Staff members have successfully trained in Art of Hosting, contributing to the development of a Community of Practice in Argyll and Bute. Skills developed for use in community and partnership settings shared with colleagues i.e. Heretohearyou, and practical application of techniques has encouraged new forms of community participation. Potential and growth; turning opportunities into reality Economic development Page 164
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Achieving sign-off of the Rural Growth Deal business and cases and begin delivering priority projects like The Marine Industry Training Centre, UAV Drone Hub and Seaweed Academy. • Deal signed on 10th March 2025. Conditional endorsement of Rothesay Pavilion FBC achieved; FQ4 grant claims submitted to Central Government. • Rural Growth Deal signed on 10th March 2025. Drawdown of 2024/25 Q4 funding to support Rothesay Pavilion. Most OBC’s now endorsed and FBC’s being progressed for KSS and Tobermory Housing projects. Further work necessary to deliver Action Plan and achieve full endorsement of Rothesay Pavilion FBC. Securing of Levelling Up funding for projects, including Argyll and Bute Western Seaboard Marine Gateways Initiative, Whisky Islands and Lorn Economic Growth Zone. • Funding re-branded as Community Regeneration Partnership following change in UK Government. £20.3m of funding committed to Argyll and Bute and negotiations are on-going with UKG and external partners to agree final priority projects. All funding requires to be committed by 2026/27 and as such, projects require to demonstrate deliverability within these • Confirmation of funding via Community Regeneration Partnership; Support UKG fieldwork visits. Identify a long-list of project options. • These applications were not successful, but Community Regeneration Partnership funding, circa £20m, was secured by Argyll and Bute Council. Page 165
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 timescales. UKG will undertake a business case for Ministerial sign off. Implement £4.5m Argyll and Bute UK Shared Prosperity Fund Investment Plan. • The Argyll and Bute UK Shared Prosperity Fund (UKSPF) Investment Plan, 2022-2025 has now been concluded; all project spend had to be completed by the end of March 2025 and all final claims to the UK Government need to be submitted by the 1st May 2025. • A final transition year of UKSPF has been agreed for 2025/26. The Transition Year UKSPF Investment Plan (further additional activity for current projects in the 2022-25 plan) was approved by the Policy and Resources Committee on 20th February 2025 and the MOU was signed between the Page 166
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 UK Government and Argyll and Bute Council mid-March 2025. Complete site development of Helensburgh Waterfront project securing long- term economic benefit. • Development of site. • Completion of Helensburgh Waterfront Development. • Marketing of the site completed and preferred developer selected. Site investigations completed and utility connections secured. Awaiting outcome of Judicial Review which was heard in Court of Session on 4th July – cannot proceed until verdict passed. Deliver the £15m Campbeltown Flood Prevention Scheme. • A multi-element £15–15.9m Flood Protection Scheme for Campbeltown to reduce risk from the Millknowe and Balgreggan B urns and from local surface- water flooding. To be delivered as four main work packages: 1. Millknowe flood storage reservoir (flood-storage basin/earthworks). 2. Upsizing/renewal of the Dalaruan Street culvert. • Delivered as designed: the key engineered elements (flood storage at Millknowe, culvert upsizing, SuDS at The Meadows, and the Burnside • The Campbeltown Flood Protection Scheme was complet ed and certified in May 2024, transitioning into the defects and monitoring phase. • The Property Flood Resilience (PFR) programme continues into 2025– 26, focusing on Page 167
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 3. Surface Water Management / SuDS at The Meadows. 4. Works at Burnside Square (public-realm + flood interventions). In addition, some property-level flood protection measures to be provided to selected properties. Argyll and Bute Council+1 • Programme / timing: construction phases to be completed through 2023–early 2024 with the council reporting the project on course to be complete around February 2024, with additional requested works and follow-up items into later 2024. Square interventions). • Hydraulic modelling and design quality • Communit y / co- benefits. property-level protection. • Revised total cost: £15.925 million (up from £15.215 m). • Main works delivered: Millknowe fl ood storage, Dalaruan culv ert, Burnside Square improvements, and SuDS at The Meadows. • Benefits noted: reduced flood risk, environmental resilience, and community economic benefit. • AECOM’s detailed hydraulic modelling was used to design the fluvial and surface water elements, and sources indicate the design intent was aligned with delivering improved flood resilience for the town. That modelling Page 168
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 supports the expectation that the interventions will materially reduce flood risk from Millknowe/ Balgreggan and from surface water. (Note: modelling = projected performance; real- world success is best judged after significant storm events and monitoring.) Institution of Civil Engineers (ICE)+1 • Community-benefit activities were reported in Sept 2024 Argyll and Bute Council+2Argyll and Bute Council+2 • Funding & cost: original secured funding was ~£15.215m with 80% Scottish Government support and 20% council contribution; later estimates in 2024 put the projected cost slightly higher (c. Page 169
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 £15.9m) and an extra ~£710k was listed for additional works Regenerate the waterfront of Ardrishaig. • • Support on-going negotiations with potential developers of Gleaner Oil Site. Ardrishaig North Public Realm works were completed April 2023. Negotiations are on- going with potential developer at former Gleaner Oil Site. Note this site is owned by Scottish Canals. £250k of funding available via Tarbert and Lochgilphead Regeneration fund to support remedial works at Gleaner site subject to an endorsed business case. Driving forward additional strategic economic development projects including progression of the Dunbeg housing, commercial and infrastructure projects and the North Lorn Economic Growth Zone through the Lorn Arc Tax Incremental Finance (TIF) scheme. • Multiple planning applications submitted for Housing / infrastructure and commercial area at Dunbeg. Determination expected by spring 2026. • Planning Applications submitted and approved for business development and infrastructure at Oban Airport. • TIF infrastructure element of FBC at Oban Airport Approved by Council and Scottish Gov. • Agreement reached with Scottish Gov to both extend the TIF income stream period by 10years and allow for the retention of income prior to project initiation. • This significantly derisks the TIF projects and gives confidence to the • Oban Airport TIF element of business park agreed – awaiting finalised costs for non TIF elements to be agreed by Full Council in Nov 2025. Once that takes place the project will move into the implementation phase. • Dunbeg once planning applications have been determined, assuming approval, the Page 170
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Council to make investments. infrastructure design and detailed costing phase will begin. This will inform the final FBC which is expected to be presented to Council’s P&R Committee early to mid 2027. Implement Conservation Area Regeneration Scheme (CARS) Projects in Dunoon, Lochgilphead, Tarbert and Helensburgh. • Proposed Heritage and Place scheme being developed for Tarbert. This will require Council match funding of circa £635k over 5 years. Development phase currently being progressed with formal bids scheduled to be submitted in August 2025. Lochgilphead CARS in delivery stages and due to complete in March 2026. At least 4 priority buildings will be completed in Lochgilphead. Helensburgh CARS is also in the delivery stages and works to the first two priority buildings commenced in September 2024. • Dunoon now complete. • Continued delivery of Lochgilphead and Helensburgh CARS schemes; • Complete Dunoon CARS • Progress Tarbert HPP Development Phase. • Lochgilphead in final stages of delivery with works to priority buildings complete. Helensburgh is ongoing with all priority buildings now on-site. Funding bids have been submitted to NHLF and HES for an HPP scheme in Tarbert and funding announcements will be made in early 2026. Maximising community economic and employment The Council’s role is a consultee in this project which is being led by Scottish Power Renewables. This is led by Scottish Power Renewables and is going through consultation stage. Page 171
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 opportunities from the Islay Scotwind offshore wind project. The Council continues to engage with the developer via forums such as ABRA. The Council are also continuing to monitor community benefit opportunities linked to renewable developments. We have also been engaging with developers around potential operations and maintenance opportunities aligned with this development. Preparing an options appraisal for implementation of a transient visitor levy. • A draft Visitor Levy (VL) Scheme will be supported by impact assessments align to the impact on businesses providing accommodation, communities, visitors and the council who will need to collect a levy if as VL Scheme is introduced in across Argyll and Bute. The options • The formal consultation on a draft Visitor Levy (VL) Scheme for Argyll and Bute will concluded on Thursday, 10th April 2025. It is a statutory requirement to prepare a Consultation Report, which will include updated impact assessments as outlined in Appendix 2 of the Special Council paper, 20th December 2024. Page 172
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 are to introduce a levy or not, further to a formal 12- week consultation period from January to March 2025, again if the consultation is approved by elected members. The content of this Consultation Report, to be prepared by external consultants, will provide recommendations if a VL Scheme should be introduced across Argyll and Bute based on the evidence gathered during the 12- week public consultation. Commercial services; making assets work now Increasing commercial development of business and retail space, including the Kilmory Industrial Park, and identifying other opportunities wherever possible. • Develop business cases for * Kilmory Industrial Park * Kilarrow House, Bowmore * Lorn House, Oban • Complete construction of Kilmory Business Park. Completion of business cases for Lorn House and Kilarrow House. • Kilmory Business Park under construction with forecast completion in Quarter 1 2026 • Killarow and Lorn House being considered for housing delivery options. Exploring additional commercial opportunities at Oban Airport. • Develop business case, apply for planning consent for business units. • Completion of Detailed Business Case for Oban Airport. • FBC (contractor verified costs) completed, planning consent received, , Tier 1 contractor appointed, design team appointed, Page 173
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 TIF & Community Regeneration Partnership funding approved. • 26th November Council meeting for Full Business Case approval and award of contracts. Delivering the Our Modern Workspace project (OMW), rationalising the council estate and facilitating hybrid working solutions. • Progress delivery of OMW project in Lochgilphead, Oban and Rothesay. • Completion of physical works at Rothesay and Oban Production of an approved by ELT Phasing Plan for changes to offices in Lochgilphead and Ardrishaig. • Works at Rothesay and Oban are complete. • Dunoon works are underway at Argyll House with completion forecast February 2026. • Design work at Lochgilphead and Ardrishaig progressing Leading the development and creation of Craigendoran Business Park as a business, engineering and innovation hub. • Site investigations to be completed. Site infrastructure and utilities to be designed and costed. • Completion of the pre-development investigative works to confirm if the site is suitable and viable for development • Site investigations completed, infrastructure and utilities designed and costed. Outcome has identified challenges with site utilities and flood risk requiring further investigation. Page 174
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 Exploring opportunities for sharing services where possible - both to help grow our income through providing our expertise and enhancing service delivery in communities where we need to source options from elsewhere. • Implementation of new shared management structure with HSCP in relation to Hostels and care homes for catering and cleaning. • Completion of 1 year review of shared management structure. • The HSCP Shared Management Project concluded at the end of June 2025. While elements of the project were successful, HSCP SLT made the decision that a return to pre-pilot arrangements would be more sustainable. Driving down further our own carbon emissions, achieving net zero by 2045 and exceeding our target of a 75% reduction by 2030, building on our good track record in relation to combatting climate change, through the delivery of our Decarbonisation Plan. • Progress Argyll and Bute Decarbonisation Plan for 2022- 2025. • Commission new Decarbonisation Plan (Routemap to Net Zero). • Draft under development with Climate Change Board Securing Carbon Literate Organisation status by the end of 2023, including completion of the rollout of carbon literacy • Securing Carbon Literate Organisation by the end of 2023 Deliver more training - application of Carbon Literate Organisation submitted and await outcome. • Completed • Complete. Exploring renewal and enhancement options Page 175
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Priority Activity 2024/25 Success Measure 2024/25 Annual Update 2024/25 training to all councillors. Partnership and Action - everyone has a part to play in Argyll and Bute’s success In our Priorities for the Council Term 2022 to 2027, we set out our areas for action to deliver our vision for Argyll and Bute. There are elements of that vision which require action from other agencies at all levels - from our communities right up to national government. We will commit to working in partnership wherever we need to as well as calling on others, with responsibility, to take the action that is required to safeguard Argyll and Bute’s success. This included: 1. Continuing to build up our strong track record in partnership working and seeking new ways of working with communities, other organisations, and the third and private sectors. 2. Continuing to work in partnership with further education and higher education providers in Argyll and Bute to ensure young people have access to high quality innovative educational opportunities that support local employers and the Argyll economy. 3. Lobbying for support for the higher-than-average energy costs faced by Argyll and Bute communities. 4. Pressing the case for retaining delivery of care services locally, where community knowledge, relationships and experience are best placed to identify and meet local needs and local accountability. 5. Calling for funding support to tackle challenges in local social care delivery - including recruitment, retention and development of care staff in communities - rather than centralisation of services. 6. Continuing to call for planning, construction and opening of the replacement route at the Rest and Be Thankful within the life of this Scottish Parliament. 7. Working in partnership with the Rothesay Pavilion Charity Trust to lobby for funding to complete the refurbishment of the Pavilion. 8. Seeking additional funding support to address the unprecedented severe weather damage to the sea defences supporting Bute’s main island roadway at Ardbeg. 9. Working with the Community Planning Partnership to develop a Climate Change Strategy for the region as a whole. 10. Adding our voice to those of our local government colleagues across Scotland to call on national government for fair funding settlements which enable councils to deliver the services that matter to communities and reinforcing the need for recognition of the vital contribution that local government makes to national priorities and Scotland’s overall success. Page 176
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11. Delivering the Argyll and Bute Employability Partnership Delivery Plan for 2024-25 through working in partnership with third sector delivery partners. – Update October 2025 – The ABEP Delivery Plan has concluded with hard stop spend at the end of March 2025. The No One Left Behind (NOLB) grant offer letter for 2025/26 has been received from the Scottish Parliament and a revised Annual Investment Plan, which will include third sector partner delivery, was submitted by 30th April 2025. There was no Scottish Government requirement to prepare a more detailed ABEP Delivery Plan for 2025/26 (just an Investment Plan). However, the ABEP members still wanted to put in place a local and shortened ABEP Delivery Plan, which was prepared further to an ABEP workshop session on 20th May 2025 and will hopefully be endorsed by the Argyll and Bute CPP Management Committee on 5th December 2025. Page 177
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ARGYLL AND BUTE COUNCIL AUDIT AND SCRUTINY COMMITTEE FINANCIAL SERVICES 16 DECEMBER 2025 INTERNAL AUDIT REPORTS TO AUDIT AND SCRUTINY COMMITTEE 2025/2026 1. EXECUTIVE SUMMARY 1.1 There are eight audits being reported to the Audit and Scrutiny Committee. 1.2 The table below provides a summary of the conclusions for the audits performed. The full reports are included as appendices to this report. Audit Name Level of Assurance High Actions Medium Actions Low Actions VFM Actions School Residential Trips Limited 4 2 0 0 Building Cleaning High 0 0 1 0 Directed Self Support (Direct Payments) Reasonable 0 6 0 0 ICT Disaster Recovery Substantial 1 3 2 0 Oban Airport High 0 0 0 0 HSCP – Governance Arrangements High 0 0 2 0 HSCP – Partnership Working High 0 0 3 0 HSCP – Workforce Planning Reasonable 0 7 0 0 1.3 Internal Audit provides a level of assurance upon completion of audit work. A definition for each assurance level is documented in each audit report. 2. RECOMMENDATIONS 2.1 Audit and Scrutiny Committee to review and endorse this summary report and the detail within each individual report. 3. DETAIL 3.1 A high level summary of each completed audit report is noted below: School Residential Trips: this audit provided a limited level of assurance. This means that internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk and placing system objectives at risk. Weakness must be addressed within a reasonable timescale with management allocating appropriate resources to the issues raised. The Council has procedures in place supported by a suite of Education Management Circulars (EMCs) for school residential trips, however, these require to be updated to incorporate the Scottish Government’s best practice Page 179 Agenda Item 11a
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“Going Out There” framework and address some identified gaps. Head Teachers or nominated deputies check and approve arrangements for school residential trips and ensure staff are supported when organising, additionally, clerical staff maintain records of trips and carry out limited checks, it was noted that limited monitoring arrangements are in place. Some schools have used external companies to help with the provision and planning of school trips without consulting the Procurement, Commercial and Contract Management Team (PCCMT). A training needs analysis and suitable training are required to be provided when undertaking school trips, however, this has not been fully undertaken. All school staff receive the required child protection information and training and individuals in regulated roles hold the required level of Disclosure Checks, however, testing identified that during home stay trips, PVG checks of hosts were not undertaken in line with Council procedures. Building Cleaning: this report provided a high level of assurance. This means that Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. The Council’s Cleaning Service has arrangements in place to carry out regular cleaning of establishments where this has been requested. Each establishment has specific cleaning staff allocated to undertake a pre-planned schedule of cleaning at an agreed frequency. Casual staff are retained in locations to provide cover for staff annual leave and absence. Changes to the Disclosure Checks requirements affect some cleaning staff who work in what are deemed regulated roles e.g. schools and nurseries. The induction pack should be reviewed to ensure that it contains up to date links to key documents/ policies, reflects current working practices and if applicable, any changes to processes required as a result of the change to the PVG scheme. There are detailed cleaning schedules and standards to support the cleaning of council premises, these are based on industry standards. Monitoring of cleaning in premises is undertaken by the cleaning services manager who conducts regular reviews and audits of cleaning practices against established benchmarks such as the British Institute of Cleaning Science (BICS) cleaning standards. Reporting of performance and issues for the cleaning services are discussed at the Commercial Services Teams meetings. No reports are currently provided to Council Committees. Directed Self Support (Direct Payments): this report provided a reasonable level of assurance. This means that Internal control, governance and the management of risk are are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Policies and procedures are in place and are up to date. A policy and procedural document – Self Directed Support, Direct Payments Option 1, Policy and Procedural Guidance for Staff and Managers is available, the most recent version, V2.5 and is dated May 2025. A leaflet – Option 2 Individual Service Funds (ISF) provides an outline guide to the four options available to clients, providing further details for Option 2 which allows the client to direct Argyll and Bute Council to commission services from a support provider on their behalf. Information is available on the Council website. Policies, procedures, guidance documents and other relevant information is available for staff on the HSCP SharePoint site. Training is provided by the Self- Directed Support Officer. Processes and procedures are in place for the checking of financial records which require to be maintained by those in Page 180
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receipt of Direct Payments. A review timetable has been established and the Finance Administration Officer (AWI) has responsibility for undertaking these reviews. We identified that there was a need to make clearer within the agreement that funds may be required to be returned in certain circumstances. The Guidance document does not provide clear guidance on the circumstances which would give rise to the requirement to ‘top up’ the Direct Payment bank account or circumstances whereby accumulated funds require to be returned. Supported Person’s financial records highlighted that financial reviews had not been undertaken in accordance with the agreed timetable and there remains a significant backlog of cases to review. Care plans require to be reviewed timeously and to make sure that the supported persons needs are being met. Oban Airport: Our overall audit opinion for this audit is that we can take a high level of assurance. This means that internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. The audit covered 6 of the 25 airport operating instructions within the aerodrome operating manual (AOI 16-20 & 24) and all were found to be satisfactory. The Manual is updated on an annual basis, and no audit issues were raised. Information and Communication Technology (ICT) Disaster Recovery (Exempt): This report is exempt from publication under paragraph 14 of part 1 to schedule 7A of the Local Government (Scotland) Act 1973 – “Any action taken or to be taken in connection with the prevention, investigation or prosecution of crime”. Health and Social Care Partnership (HSCP) Governance Arrangements (For Noting Only): this audit provided a high level of assurance. This means that Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently, in particular the report highlights the following strengths and areas for improvement. The HSCP governance framework is well-documented, formally approved, and reviewed in accordance with statutory and good practice standards, additionally, it promotes transparency, stakeholder accessibility, and clear documentation of decisions. The governance structure and responsibilities within the HSCP are clearly laid out in governance documents and reflect good practice. Strategic plan performance and audit recommendations are actively monitored. Governance interactions between the Integrated Joint Board (IJB), Council, and National Health Service (NHS) Highland are well-established. While role clarity is strong, additional improvements could be made by enhancing accessibility and communication of these responsibilities and training expectations. A governance roles guide and organisational chart should be developed to clarify officer responsibilities and committee reporting lines. Information on IJB member training and induction should be published to enhance transparency for stakeholders and potential board members. Health and Social Care Partnership (HSCP) Partnership Working (For Noting Only): this audit provided a high level of assurance. This means that Page 181
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Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently, in particular the report highlights the following strengths and areas for improvement. Argyll and Bute HSCP operate within a clear and effective governance framework established by the Integration Scheme, which defines statutory responsibilities, decision-making structures, and operational processes between Argyll and Bute Council and NHS Highland. Evidence from recent Integrated Joint Board (IJB) minutes, Chief Officer reports, and the Direction Log confirms active participation, structured collaboration, and compliance with legislative expectations across both partners. IJB meeting records and the Direction Log demonstrate transparent, documented, and jointly actioned decision-making. The approval process for the Joint Strategic Plan further confirms collaborative planning and shared accountability. Argyll and Bute HSCP and Council demonstrate strong alignment through shared strategic goals embedded in key planning documents such as the Joint Strategic Plan, Commissioning Strategy, and Digital Modernisation Strategy. Joint planning is facilitated by statutory structures like the Strategic Planning Group and Locality Planning Groups, with clear partner and stakeholder involvement. Performance against shared objectives is actively monitored using structured reporting and risk management frameworks. Argyll and Bute HSCP have robust governance arrangements for dispute resolution, with clearly defined escalation procedures set out in the Integration Scheme and Standing Orders. HSCP should continue to develop existing workforce performance monitoring arrangements so that key performance indicators (KPIs) and red, amber and green (RAG) assessments remain clearly linked to strategic objectives and risks that IJB developed in partnership with both employing bodies. To strengthen assurance, the HSCP should consider embedding awareness of escalation and dispute resolution routes from the Integration Scheme into induction for senior managers and key officers to ensure consistent understanding across the partnership and with wider partners. HSCP should capture and review recurring themes or patterns from informal partnership challenges to support organisational learning and provide assurance to the IJB that risks are being managed proactively. HSCP Workforce Planning (For Noting Only): this report provided a reasonable level of assurance. This means that Internal control, governance and the management of risk are are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Workforce Plan 2022–2025 aligns clearly with Scottish Government guidance DL (2022)09, the Joint Strategic Plan, Digital Modernisation Strategy, and National Workforce Strategy. Workforce planning responsibilities are well embedded within the Integration Scheme and committee Terms of Reference. Routine reporting of workforce matters occurs through quarterly workforce reports and IJB papers. Workforce risks such as recruitment/retention and remote/rural challenges are clearly reflected in the Strategic Risk Register, reviewed biannually by Audit and Risk Committee and Integrated Joint Board. Multi-agency involvement is strong (ABC, NHSH and third sector) in committees and planning groups. There is currently no standalone annual Workforce Plan progress/refresh report is produced, meaning the IJB lacks a clear annual overview aligned to SG guidance DL (2024)33. A concise “workforce at a glance” KPI summary is not currently provided, limiting quick visibility of key workforce indicators for decision- Page 182
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makers. There is no single consolidated Workforce Plan action tracker, resulting in inconsistent ownership, missing baselines/targets, and difficulty monitoring progress. The Scottish Government Appendix 1 ‘Indicative Content Checklist’ (DL 2022/09) is not currently completed or retained, and should be fully completed and documented as part of future Workforce Plan refreshes. There is currently no costed funding map jointly across NHS Highland and Argyll & Bute Council Finance/HR, setting out estimated costs, named funding sources/budget codes, phasing, and expected benefits/savings for each priority action. There is no consolidated agency and supplementary staffing dashboard integrating service-level spend, FTE, trends, key drivers and ownership, meaning workforce reporting does not provide the level of oversight required by the IJB. There is no consolidated Finance–HR dashboard bringing together agency and supplementary staffing data (service- level spend, FTE, trends, key drivers and named owners), limiting the clarity of reporting and oversight available to the IJB. 4. CONCLUSION 4.1 Management has accepted each of the reports submitted and have agreed responses and timescales in the respective action plans. 5. IMPLICATIONS 5.1 Policy – None 5.2 Financial – None 5.3 Legal – None 5.4 HR – None 5.5 Customer Service – None 5.6 Risk – The implementation of recommendations contained in audit reports may help mitigate the risk to the Council 5.7 Climate Change – None 5.8 Fairer Scotland Duty – None 5.9 Equalities - protected characteristics – None 5.10 Consumer Duty – None 5.11 Island Communities – None 5.12 Children’s Rights and Wellbeing – None Paul Macaskill Chief Internal Auditor 16 December 2025 For further information contact: Paul Macaskill, Chief Internal Auditor Tel: 01546 604108 Email: paul.macaskill@argyll-bute.gov.uk APPENDICES 1. School Residential Trips 2. Building Cleaning 3. Directed Self Support (Direct Payments) 4. Oban Airport Page 183
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5. HSCP – Governance Arrangements (For Noting Only) 6. HSCP – Partnership Working (For Noting Only) 7. HSCP – Workforce Planning (For Noting Only) Page 184
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Argyll and Bute Council Internal Audit Report November 2025 FINAL High Medium Low VFM Number of Findings 4 2 0 0 Process for School Residential Trips Audit Opinion: Limited Page 185
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2 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 3 Key Dates ................................................................................................................................................ 4 Risks ........................................................................................................................................................ 4 Audit Opinion ......................................................................................................................................... 4 Recommendations ................................................................................................................................. 4 2. Objectives and Summary Assessment ........................................................................................... 5 3. Detailed Findings ............................................................................................................................ 8 Appendix 1 – Action Plan ..................................................................................................................... 15 Appendix 2 – Audit Opinion ................................................................................................................. 18 Contact Details Internal Auditor: Annemarie McLean Telephone: 01700 501354 e-mail: annemarie.mclean@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 186
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3 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Scrutiny Committee in March 2025, we have undertaken an audit of Argyll and Bute Council’s (the Council) system of internal control and governance in relation to the process for school residential visits. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with council officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during the course of our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the Council. 3. The contents of this report have been agreed with the appropriate council officers to confirm factual accuracy, and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. Scotland’s outdoor environment offers motivating, exciting, varied, relevant and easily accessible activities from pre-school years through to college and beyond. Through Curriculum for Excellence, and Learning for Sustainability, the Scottish Government endorses the value of children and young people enjoying positive learning and play experiences in a wide variety of settings from galleries and museums to woodlands, parks and wild natural spaces, as well as planned adventure and residential experiences. 5. An enjoyable, creative, challenging learning journey helps children and young people learn by experience and grow as confident and responsible citizens who value and appreciate their local area and the wider environment of Scotland, which includes spectacular landscapes, rich natural heritage and a diverse built environment including landmarks of international significance, as well as further afield. 6. Excursions and educational visits are an important and valuable part of our educational system. Getting more children and young people out of the traditional classroom and into the real world, by giving access to cultural experiences and outdoor learning and play opportunities provides invaluable life experiences. 7. A residential experience can be an extremely valuable learning opportunity and may be part of the progressive outdoor learning or cultural experiences provided for young people. Residential visits include any form of overnight stay regardless of the type of accommodation. Scope 8. The scope of the audit was to determine if the current processes are embedded prior to the expansion of residential trips which will be available to all children, as outlined in the Terms of Reference agreed with the Head of Education: Performance and Improvement on 03 July 2025. 9. It was agreed that the purpose of the audit was to identify areas for process improvement, its applicability to be applied consistently across the Council’s school estate rather than highlighting Page 187
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4 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 specific issues at an individual school level. A detailed list of issues arising will be provide to the Service and the recommendations for improvement contained within it, reflects this agreed focus on aiding the Council’s preparations for the expansion of residential trips. 10. The Legislation regarding this expansion is still being considered and the timescales agreed for completing the recommendations takes cognisance of this. Key Dates 11. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted below. Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 03 July 2025 Fieldwork Commencement 12 August 2025 Draft Report issued 10 November 2025 Management Comments received 18 November 2025 Final Report issued 18 November 2025 Audit and Scrutiny Committee 16 December 2025 Risks 12. The risks considered throughout the audit were: • Audit Risk 1: Processes and procedures for school residential trips are not effective. • Audit Risk 2: Monitoring arrangements do not provide sufficient oversight of school residential trips. • Audit Risk 3: Staff have not been provided with appropriate information, instruction and training regarding their responsibilities related to school residential trips. Audit Opinion 13. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 14. Our overall audit opinion for this audit is that we can take a limited level of assurance. This means that internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. Recommendations 15. We have highlighted four high priority recommendations and two medium priority recommendations where we believe there is scope to strengthen the control and governance environment. These are summarised below: Page 188
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5 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 • Education Management Circular 3.25 and its appendices, should be reviewed, clarified and updated to contain a flow chart and checklist section on key tasks which can be used to document and evidence compliance with relevant legislation. • Education Management Circular 3.14 and its appendix should be reviewed and updated with the assistance of Legal Services. • Education Management Circular 1.26 and its appendices, should be reviewed, clarified and updated to ensure it takes cognizance of best practice contained in the “Going Out There” Framework. • Appropriate corporate monitoring arrangements should be established and implemented. • Consideration should be given to the Procurement and Commercial Contract Management Team (PCCMT) being consulted prior to making bookings/ entering into an agreement with external providers for school residential trips. • A training needs analysis should be undertaken, and suitable training provided, for Head Teachers and staff, including clerical, involved in the processes of planning and undertaking of school residential trips. 16. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 17. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective. Exhibit 1 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion 1 Procedures for school residential trips are in place, up to date and take cognisance of best practice. Audit Risk 1 Reasonable • The Council has procedures in place for school residential trips. These are not all up to date and the Council has not yet adopted the Scottish Government best practice “Going Out There” framework. • There are five Education Management Circulars (EMCs) that provide guidance and instruction relating to the procedures for planning and undertaking of school residential trips. • The Service is aware that the EMCs require updating and has established a working group to facilitate the Council’s adoption of the “Going Out There” best practice framework. • Three of the EMCs need updating to reflect current working practices and identified gaps in the Page 189
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6 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 procedures. The roles and responsibilities of all staff involved in the process are not stated and linkages between the circulars could be clearer. • There are no record retention periods stated for key documents which has led to inconsistent record keeping. • When enquiring with schools about the trips that they have undertaken, some have used external companies to help with the provision and planning of the trips. Consideration should be given to PCCMT being consulted prior to making bookings and/or entering into an agreement with external providers for school residential trips. • Procedures are not easily accessible to staff as the end-to- end process for planning school residential trips are not contained in one document. When updating the circulars there would be benefit to considering including a flow chart providing a visual overview and a checklist as these could help streamline and standardise the processes, whilst aiding better overall understanding and improving consistency of approach. 2 There are appropriate oversight and monitoring arrangements in place for schools undertaking residential trips. Audit Risk 2 Limited • The EMCs provide information and instruction to schools to assist staff in planning and approval processes for school residential trips, there is no mention of monitoring arrangements in contained in these documents. Testing and overview have established that out with schools, there is insufficient or limited monitoring arrangements in place for schools undertaking residential trips. • In schools, Head Teachers, or their nominated deputies, as Head of the establishment, are responsible for checking and approving arrangements for school residential Page 190
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7 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 trips and are expected to ensure staff are supported in organising school trips. • Clerical staff in School Support Teams, record details of trips and carry out limited checks, so that the information is available on request, but nothing else is done with this information. We would expect that, for example, this is used to inform, monitoring, feedback and training. 3 Staff involved in school residential trips have been provided with appropriate information, instruction and training regarding their responsibilities. Audit Risk 3 Limited • The EMCs provide information and instruction but as noted above, these require updating. • The Council’s Corporate Health and Safety policy states that a training needs analysis should be undertaken, and suitable training be provided. This has not been undertaken for school residential trip processes; No corporate practical training is made available to staff regarding their responsibilities and staff are not directed to the LEON Risk Assessment module. • Other basic training suggested is First Aid training. Testing identified a first aid trained member of staff was not present on some school residential trips. In some instances, this is covered by the facility being visited, however, this should not be relied upon. 4 Adults participating in school trips have received the required child protection information/basic training and evidence of this is retained. Audit Risk 2 Reasonable • The Council has well established processes and arrangements in place to ensure that all school staff receive the required child protection information and training with records kept to evidence this. • Legislation regarding the Disclosure Checks - Protecting Vulnerable Groups (PVG) scheme changed in April 2025. • The Council carried out an organisation wide check of regulated roles and took steps to ensure that the individuals in those roles undertook the required level Page 191
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8 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 of Disclosure Checks and appropriate evidence retained. • Testing identified that during home stay trips PVG checks were not undertaken in line with Council procedures. • The revised PVG scheme requirements should be considered both, when updating the EMCs and when developing monitoring arrangements. 18. Further details of our conclusions against each control objective can be found in Section 3 of this report. 3. Detailed Findings Procedures for school residential trips are in place, up to date and take cognisance of best Practice. 19. The Scottish Government developed the “Going Out There” Framework which relates to outdoor experiences and off-site visits in a wide variety of settings from galleries and museums to woodlands, parks and wild natural spaces, as well as planned adventure and residential experiences. It is expected that ‘Going Out There’ should be adopted as a common framework across Scotland by all those managing or organising visits or providing activities and venues. 20. The aims include to increase confidence and co-operation and that by adoption of the good practice exemplified in the framework allows Employers to fulfil their responsibilities under the Health and Safety at Work Act 1974 for outdoor experiences and off-site visits for all participants. 21. The Scottish Advisory Panel for Outdoor Education (SAPOE) is the forum where Scotland’s outdoor learning community collaborates to develop best practice in the design and safe delivery of outdoor learning for all children and young people in Scotland. It is member led, and representatives include Local Authorities. One of its key aims is: “promote and develop consistent good practice across Scotland for off-site visits through the implementation of the framework Going Out There”. 22. Not all Councils have chosen to adopt the “Going Out There” best practice yet. The Service has made the decision to adopt the best practice guidance and has established a working group to undertake this. The group comprises one Education Manager, two Headteachers (one being the SAPOE representative) and a representative from school support team. 23. This group has already identified the school trips and outdoor learning management circulars requiring updating as they need to reflect the decision to adopt the national guidance. 24. The Council’s Education Service have a suite of Education Management Circulars (EMCs) which collectively form the current policies and procedures issued to schools. There are five EMCs that provide guidance and instruction relating to the procedures for planning and undertaking of school residential trips, these are: Page 192
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9 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 • EMC 3.25 School Trips -is the main circular, containing most of the procedures, it directs staff read EMC 3.14, EMC 1.26 and EMC 3.23 and was last reviewed in 2017. • EMC 3.14 Insurance – provides details of the three insurance policies available to cover school trips and procedures for notifying and liaising with Insurance Services and was also last reviewed in 2017. • EMC 1.26 Outdoor Education - gives overarching guidance for individual activities, last reviewed 2023 – although this appears to be incomplete. • EMC 3.23 Child Protection and Safeguarding - is a core Council policy document which is supported by annual training provided to all school staff, it was updated in July 2023. • EMC 1.10 School Funds – provides guidance and instructions relating to the financial aspects of school residential trips, this was updated in May 2025, in response to internal audit recommendations. 25. The circulars reviewed in detail as part of this audit were, School Trips, Insurance and Outdoor Education. The information in these was used to test procedures in nine schools which included, one joint campus, two 2-18 schools and six primary schools. 26. The School Trips circular is the main source of guidance and instruction for staff involved in the planning and undertaking of school trips, including residential trips and contains three appendices. 27. The School Trips circular has not been updated since 2017 and does not reflect current working practices and contained gaps which we have identified including: • No record retention period for any of the documents, which has led to inconsistent record keeping among the different schools. • There is no formal or consistent process for P7 transition trips. These require co- ordination between multiple schools with staff in different schools carrying out tasks. Lack of guidance has resulted in school support not been notified by all schools involved in the trips. • There is no tailored approval form for home stay trips. • There are missing links to documents and contact details. • Post trip reports are now verbal and are mostly lessons learned. It is unclear whether this is the current way of working or if reports no longer required. 28. The circular sets out the roles and responsibilities for four key roles involved but not all roles and responsibilities are included. • Head Teacher/Campus principles /nominated delegate – as Head of the Establishment has overall responsibility for all trips and approval. • Leaders In Charge – the teacher (s) planning and leading the school residential trip. • Supervising staff – accompanying the trip. • School liaison officer – the in-school contact for those on the trip. 29. Clerical staff in the schools have an active role, performing tasks related to the administration for school trips but this is not detailed in the circular and has led to differing practices and inconsistency within schools. In some small primary schools, clerical staff organise the trips while in other larger schools, teachers undertake more of the administration. Page 193
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10 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 30. The School Support Team is the corporate support team which consists of the School Support Manager, the Admin and Finance Officers and clerical staff. Schools are advised to send a copy of the approval forms to school support for them to record. The tasks carried out by theses staff are not detailed in the circular. 31. When updating the circulars there would be benefit to reviewing the tasks at each stage of the process and clarifying the roles and responsibilities of the staff involved. Action Plan 1 32. As noted above, EMC 3.14 Insurance provides details of the insurance policies in place for school trips and procedures for notifying and liaising with Insurance Services, it was last reviewed 2017. 33. The Council has four policies available to schools’ undertaking trips, the costs of these are apportioned into school budgets: • Public Liability & Employers Liability insurance automatically covers all employees and all activities officially approved by school, outdoor centre, youth club etc are covered. Cover is automatic and insurance documents are published on the Hub. • Group personal accident policy - applicable to staff only, cover is automatic. • School journey policy is available for trips involving overnight stays, it covers participants, teachers and other adults, whether employees or not, who accompany them. Examples of cover include medical expenses, cancellation expenses, personal effects and legal liability. o This policy is optional, and cover is supplied only when schools complete the School Travel Insurance Policy Proposal form (appendix 1) and submit this to Insurance Services, before the event. 34. Schools are not directly provided with copies of the policies where there is automatic cover and there are no links in the circular to these, rather it states that it is the Head Teachers responsibility to “ensure that all staff who may be involved in organising school journeys are made aware of the content”. 35. When Insurance Services receive Appendix 1 requests from schools, they record this so that they have the details in the event of a claim and provide schools with a copy of the School Journey policy. 36. The guidance contained in the Insurance circular could be clearer, and some gaps were identified which create the potential that trips are booked without fully checking the existing cover available. These include: • Appendix 1 - staff are advised to submit this before the event, there are no minimum timescales within which schools should submit this form to Insurance Services nor any retention period for this. • Appendix 1 - asks for minimal details only and does not require to be signed by the Head Teacher/ person approving the trip. • The School Journey Policy schedule is only provided to schools after Appendix 1 has been submitted, this has some exclusions, e.g. maximum age covered is 70 and limitations on winter sports, which are not reflected in the Insurance circular. Page 194
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11 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 37. The Insurance Circular and its appendix should be reviewed and updated with the assistance of Legal Services to ensure it reflects current working practices and requirements. Action Plan 2 38. Residential trips are classified as all school journeys involving an overnight stay, these should be notified to Insurance Services and as the School Journey Policy cover is an extensive policy additional insurance is not normally required. 39. Testing of processes within schools found that there are occasions when schools do not advise Insurance Services of residential trips and pay for insurance cover with external parties, examples included an outdoor centre being visited and a company organising an overseas trip. The costs of this are included in the total trip costs, either some or all of which are paid by for mostly by families of those participating in the trips. 40. Insurance Services maintain a record of all insurance claims. In the past five years there have only been twelve claims, six of which related to cancellations due to lockdown. 41. The Outdoor Education circular gives overarching guidance for individual activities. In recognition that many heads of educational establishments and staff involved in the planning of outdoor education and activities are not specialists in these areas and so may have difficulty in the exercise of judgements on certain outdoor activities. To provide support with this, the Council has engaged the services of a technical adviser, who is kept on retainer, and is available to provide advice. 42. The Outdoor Education circular was reviewed in 2023, but this document appears incomplete as there are missing sections, specifically those relating to the Scottish Government “Going Out There” best practice framework/toolkits. Action Plan 3 43. Both the School Trips and Outdoor Education circulars provide some guidance on the use of external providers, requiring that Head Teachers/Head of Establishment should be fully satisfied as the capability of the external provider, e.g. travel or activity provider. 44. When enquiring with schools about the trips that they have undertaken, some have used external companies to help with the provision and planning of the trips. There has been no direct instruction from Senior Managers that advice should be sought from Procurement and Commercial Contract Management Team (PCCMT). 45. Some providers have been engaged with via PCCMT, but this has only happened when the team having become aware, via their overview and monitoring of spend, that providers are being used or will be used on a regular basis for school trips. PCCMT have then followed procurement processes and put appropriate arrangements in place. Consideration should be given to PCCMT being consulted prior to making bookings/ entering an agreement with external providers for school residential trips. Action Plan 5 46. Education Maintenance Circulars are all published on the Council’s website but procedures are not easily accessible to staff as the end-to-end process for planning school residential trips and are not contained in one document. Page 195
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12 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 47. School offices tend to keep copies of school trip packs which contain forms that are required, with some schools developing a covering checklist with key tasks. Staff planning trips are provided with copies of these packs from the offices, however, these do not always contain a copy of the circular and similarly do not always read the School Trip and Insurance circulars in full; most were unaware of the linkages to the Outdoor Education circular. 48. When reviewing and updating the circulars there would be benefit to considering including a flow chart providing a visual overview and a checklist as these could help streamline and standardise the processes. This may help navigate the process more effectively and support consistency of approach. Action Plan 1,2 and 3 There are appropriate oversight and monitoring arrangements in place for schools undertaking residential trips. 49. The Education Management Circulars provide information and instruction to schools to assist staff in planning and approval processes for school residential trips. There is no mention of centralised monitoring arrangements in these documents and our testing established that out with schools there are no monitoring arrangements in place. 50. In schools, Head Teachers, or their nominated deputies, as Head of the establishment, are responsible for checking and approving arrangements for school residential trips and are expected to ensure staff are supported in organising school trips. 51. The School Trips circular appendix 2 – Residential Trips is the approval form that Leaders in Charge complete with the main details of the proposed trip. This form is passed to the Head Teacher for review and approval. Copies of this should be retained in the office and emailed to the School Support Team for recording. A review of forms found most are completed and signed but there are other examples that were incomplete, some unsigned and some were out of date forms from 2013. 52. Clerical staff within the school support team file the documents received from schools and record some of the information on the Master School Trip spreadsheet. Limited checks are carried out e.g. there is a formula built into the spreadsheet to check the ratios of pupils to teachers. This information is available on request but nothing else appears to be done with the information. 53. Schools do not receive any acknowledgement nor feedback, unless the ratios need queried. Discussions with Head Teachers and staff in schools established that the assumption is that no response or feedback means that there are no issues with the forms and processes. 54. A sample of available Appendix 2 Approval forms, from schools and from the school support records were reviewed and compared with the Master School Trip spreadsheet, this found that not all trips undertaken were notified to school support, some schools submitted copies of risk assessments, others did not. 55. The lack of sufficient monitoring of both schools and school support processes has meant that there are no mechanisms for providing feedback to staff. As a result, staff are unaware where procedures could be improved. Page 196
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13 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 56. Appropriate corporate monitoring arrangements should be established and implemented. There would be benefit to updating the School Trips Master spreadsheet to ensure that it capture all the information required to support monitoring arrangements. Action Plan 4 Staff involved in school residential trips have been provided with appropriate information, instruction and training regarding their responsibilities. 37. The EMC’s provide written information and instruction to staff, outlining responsibilities for Head Teachers and Leaders in Charge, but as noted above, these require updating. 38. No corporate/ practical training is made available to staff involved in the planning and undertaking of school residential trips, rather Head Teachers are expected to follow the management circular and ensure staff are supported to organise school trips. Head Teachers can contact the Education Managers for support, but this is not detailed in either the School Trip or Outdoor Learning circulars. 39. Feedback during testing highlights that staff would like some formal or tailored training to help them feel more confident planning and undertaking school residential trips. Most go to other teachers who have undertaken trips previously for advice. 40. School excursions and educational visits can involve an element of risk, and the School Trips circular instructs staff to carry out a risk assessment at the planning stage. A review of the circulars and wider testing established that: • There are no arrangements in place to provide training on the completion of risk assessments to Leaders in Charge/ staff planning school trips and those expected to approve school trips. • The circulars do not refer staff to the Council’s LEON Risk Assessment training module. • No risk assessment template is included in any of the circulars. • The further information section on P19 of the School Trips circular provides a link to The Health and Safety Executive leaflet Five steps to risk assessment • Some schools had been provided with a risk assessment template by the Council’s Health and Safety Team. • There is no retention period stated for completed risk assessments. • There is no monitoring of risk assessments carried out. 41. EMC 1.26 Outdoor Education states the “First Aid certificate - requirements “the level of first aid training required by the authority for all activities is the 'standard' first aid course”. There is no mention of First Aid requirements in EMC 3.25 School Trips. Action Plans 1 and 3 42. Testing highlighted that there is not always a First Aid trained member of staff participating in all school residential trips. In some instances, like trips to outdoor centres, this is covered by the facility being visited. Page 197
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14 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 43. The Council’s Corporate Health and Safety plan states that Services should “undertake a training needs analysis and provide suitable training to staff, taking into account risk assessments for work activities and the need to provide appropriate Health and Safety induction and refresher training, in line with the relevant policies and local risk assessment”. This has not been carried out for school trips processes. 44. A training needs analysis should be undertaken, and suitable training provided, for Head Teachers and staff, including clerical, involved in the processes of planning and undertaking of school residential trips. This should consider, making the LEON Risk Assessment Module compulsory and requirements for First Aid Training. Action Plan 5 Adults participating in school trips have received the required child protection information/basic training and evidence of this is retained. 45. The Council has well established processes and arrangements in place to ensure that all school staff receive the required child protection information and training with appropriate records kept for evidence of this occurring. 46. Prior to the start of each new academic year, schools have two in-service days, child protection training is provided to all staff and records maintained by schools of this. 47. From 1 April 2025, it is a legal requirement for individuals to be a member of the Disclosure Checks – Protecting Vulnerable Groups (PVG) scheme when carrying out a regulated role with children, protected adults, or both. Organisations had to ensure that individuals who are to carry out a regulated role (paid or voluntary) have PVG scheme membership from 1 April 2025 onwards. 48. To comply with this legislation the Council carried out an organisation wide check of regulated roles and took steps to ensure that the individuals in those roles undertook the required level of Disclosure Checks and evidence of this is retained. 49. Testing identified that during home stay trips PVG checks were not undertaken in line with Council procedures. 50. The revised PVG scheme requirements should be included when updating the guidance and instructions within the EMCs, including EMC 1.56 Disclosures, and considered when developing monitoring arrangements. Action Plans 1, 3 and 4 Page 198
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Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date High 1 EMC 3.25 School Trips and its appendices are not up to date and gaps have been identified. The School Trips circular should be reviewed, clarified and updated. There would be benefit to including a flow chart providing a visual overview and a checklist as these could help streamline and standardise the processes, improving consistency of approach while helping document and evidence compliance with relevant legislation and Scottish Government best practice contained in the “Going Out There” Framework. Processes and procedures for school residential trips are not effective and record keeping arrangements may not provide sufficient evidence of compliance with relevant legislation. The Education working group established to facilitate the Council’s adoption of the “Going Out There” best practice framework, will lead the review of the circular. Education Officer 30 August 2026 High 2 EMC 3.14 Insurance and its appendix have not been updated since 2017. The circular could be clearer, and some gaps were identified which create the potential that trips are booked without fully checking the cover available. This circular should be reviewed and updated with the assistance of Legal Services. There is the potential that trips are booked without fully checking exclusions within the cover available. The Education working group established to facilitate the Council’s adoption of the “Going Out There” best practice framework will lead the review of the circular, with the assistance of Legal Services. Education Officer 30 August 2026 High 3 EMC 1.26 Outdoor Learning and its appendices, do not take account of best practice “Going Out There” framework. The circular should be reviewed, clarified and updated to ensure it takes cognisance of the best practice contained in the “Going Out There” Framework. The Councils current processes are not as efficient and effective as they could be if they were following best practice guidance in relation the planning of school residential trips. The Education working group established to facilitate the Council’s adoption of the “Going Out There” best practice framework will lead the review of the circular. Education Officer 30 August 2026 High 4 Insufficient oversight of schools undertaking residential trips. The lack of monitoring of both schools and school support processes has means there is no mechanism for providing feedback to staff. As a result, there are inconsistent Monitoring arrangements do not provide sufficient oversight of school residential trips. The Education working group established to facilitate the Council’s adoption of the “Going Out There” best practice framework will determine appropriate corporate monitoring Education Officer 30 August 2026 Page 199
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16 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 No Finding Risk Agreed Action Responsibility / Due Date approaches, and staff are unaware where procedures could be improved. Appropriate corporate monitoring arrangements should be established and implemented. arrangements which will be implemented. Medium 5 Insufficient guidance on use of external providers. Guidance on the use of external providers places responsibility for checks on those approving school residential trips. When enquiring with schools about the trips that they have undertaken, some have used external companies to help with the provision and planning of the trips. Consideration should be given to the Procurement and Commercial Contract Management Team (PCCMT) being consulted prior to making bookings with external providers for school residential trips. Staff have not been provided with appropriate information, instruction and training regarding their responsibilities related to school residential trips. The Education working group established to facilitate the Council’s adoption of the “Going Out There” best practice framework, in consultation with Procurement and Commercial Contract Management Team (PCCMT), will consider this. Education Officer 30 August 2026 Medium 6 Staff involved in school residential trips have not been provided with training regarding their responsibilities. No training analysis has been undertaken, and no corporate/ practical training is made available to staff; gaps include the completion of risk assessments and first aid training. Head Teachers are expected to follow the circular and ensure staff are supported to organise school trips. A training needs analysis should be undertaken, and suitable training be provided, for Head Teachers and staff, including clerical, involved in the processes of planning and undertaking of school residential trips. This should consider: • making the LEON Risk Assessment Module compulsory. • requirements for First Aid training. Staff have not been provided with appropriate information, instruction and training regarding their responsibilities related to school residential trips. The Education working group established to facilitate the Council’s adoption of the “Going Out There” best practice framework will consider the training needs analysis and what training should be provided for those involved in the processes of planning and undertaking of school residential trips. Education Officer 30 August 2026 Page 200
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17 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the council to achieve better value for money (VFM). Page 201
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18 Argyll and Bute Council – Internal Audit Report –Process for School Residential Trips November 2025 Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 202
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Argyll and Bute Council Internal Audit Report November 2025/6 FINAL High Medium Low VFM Number of Findings 0 0 1 0 Building Cleaning Audit Opinion: High Page 203
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2 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 3 Key Dates ................................................................................................................................................ 3 Risks ........................................................................................................................................................ 4 Audit Opinion ......................................................................................................................................... 4 Recommendations ................................................................................................................................. 4 2. Objectives and Summary Assessment ........................................................................................... 4 3. Detailed Findings ............................................................................................................................ 6 Appendix 1 – Action Plan ..................................................................................................................... 10 Appendix 2 – Audit Opinion ................................................................................................................. 12 Contact Details Internal Auditor: Annemarie McLean Telephone: 01700 501354 e-mail: annemarie.mclean@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 204
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3 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Scrutiny Committee in March 2025, we have undertaken an audit of Argyll and Bute Council’s (the Council) system of internal control and governance in relation to building cleaning. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with council officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during the course of our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the Council. 3. The contents of this report have been agreed with the appropriate council officers to confirm factual accuracy, and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. The purpose of the Cleaning Service is to provide a clean and safe working and learning environment for Council employees and for pupils and staff in schools and nurseries across the Council area. Cleaning is provided to 46 Council offices and buildings, and to the 36 larger schools across the Council: the remainder of cleaning in very small schools is carried out by janitor/cleaners who are directly managed by Education. 5. The cleaning service employs around 220, part time and term time staff, the majority of which are female. Cleaning staff often work out of hours and are employed on the lowest SLGE grades. These are entry level jobs that offer meaningful and valuable employment opportunities to a range of people, including to young people with no work experience elsewhere. 6. The cleaning team provides commercial cleaning services to Argyll Community Housing Association (ACHA) and the Valuation Joint Board, generating income for the council via this approach. Services are provided to ACHA offices and sheltered housing facilities across the Council area. Scope 7. The scope of the audit was to review and assess the arrangements for cleaning across the Council establishments, as outlined in the Terms of Reference agreed with the Head of Commercial Services on 02 September 2025. Key Dates 8. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted below. Page 205
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4 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 9. Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 02 September 2025 Fieldwork Commencement 22 September 2025 Draft Report issued 18 November 2025 Management Comments received 26 November 2025 Final Report issued 26 November 2025 Audit and Scrutiny Committee 16 December 2025 Risks 10. The risks considered throughout the audit were: • Audit Risk 1: Arrangements for the cleaning of Council establishments are adversely impacted due to insufficient staff cover in each location. • Audit Risk 2: Monitoring and reporting of the quality of cleaning is not undertaken. Audit Opinion 11. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 12. Our overall audit opinion for this audit is that we can take a high level of assurance. This means that Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Recommendations 13. We have highlighted one low priority recommendations where we believe there is scope to strengthen the control and governance environment. This is summarised below: • The Induction Pack contains out of date links and should be reviewed to ensure it reflects current working practices, and if applicable, reflect changes to the PVG scheme. 14. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 15. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective. Page 206
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5 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 Exhibit 1 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion 1 The Council has arrangements in place to carry out regular cleaning of Council establishments. Audit Risk 1 Audit Risk 2 Substantial • The Council’s Cleaning Service has arrangements in place to carry out regular cleaning of establishments where this has been requested. • Each establishment has specific cleaning staff allocated to undertake a pre- planned schedule of cleaning at an agreed frequency. • Cleaning staff do not have access to Council computers, so all training records, including Induction training, are manual records. These are stored at each premises in the on-site Health and Safety folders, except for GDPR training which is collated by Operational Delivery Managers. • New employees are provided with an induction pack with contains links to key Council policies. These links do not work. • Casual staff are retained in locations to provide cover for staff annual leave and absence. Changes to the Disclosure Checks requirements affect some cleaning staff who work in what are deemed regulated roles e.g. schools and nurseries. • The induction pack should be reviewed to ensure that it contains up to date links to key documents/ policies, reflects current working practices and if applicable, any changes to processes required as a result of the change to the PVG scheme. 2 Cleaning standards are being utilised, and the quality of cleaning is monitored and reported regularly. Audit Risk 2 High • There are detailed cleaning schedules and standards to support the cleaning of council premises, these are based on industry standards. • Monitoring of cleaning in premises is undertaken by the cleaning services manager who conducts regular reviews and audits of cleaning practices against established benchmarks such as the BICs standards. The Operations Officers or Managers carry out ad- hoc spot check on premises on a regular basis. No documentation relating to this was reviewed as part of the audit. Page 207
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6 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 • Building users are sent surveys requesting feedback but these are rarely returned, instead any issues are raised with the Operational Delivery Managers, who discuss these at weekly catch up meetings with the Senior Manager - Catering, Cleaning, Events and Food Strategy. • Reporting of performance and issues for the cleaning services are discussed at the Commercial Services Teams meetings. No reports are currently provided to Council Committees. 16. Further details of our conclusions against each control objective can be found in Section 3 of this report. 3. Detailed Findings The Council has arrangements in place to carry out regular cleaning of Council establishments. 17. The Council’s Cleaning Services has arrangements in place to carry out regular cleaning of Council establishments where this has been requested. Each establishment has specific cleaning staff allocated to undertake a pre-planned schedule of cleaning at an agreed frequency. 18. The service has recently gone through changes to the management structure. To support delivery of cleaning services across the geographic area of the Council, the Commercial Services current structure is: • Senior Manager - Catering, Cleaning, Events and Food Strategy • two Operational Delivery Managers, one East and one West • four Operational Officers, one for each Council area, have responsibility for both catering and cleaning staff for the establishments within the areas. 19. Cleaning Services maintain the Cleaning Premises spreadsheet which has a list of premises where cleaning has been requested. This list is not compared to a Council premises list as it is the responsibility of the Service occupying the building to request cleaning arrangements and to notify any changes to cleaning services. 20. Specific arrangements for each premises and the assessed/measured area to be cleaned, are detailed on the Cleaning Template which is maintained by the Operational Delivery Managers who updates the template as changes occur. For each establishment, this lists: • The assessed/measured area to be cleaned • The number of staff allocated to clean that premises • The weekly hours per post and the working pattern of these hours. 21. Education Service has a central process for notifying changes to the cleaning requirements in schools and, for other services, the Building Responsible Person for that establishment, will contact the Operation Delivery Managers for that area. Page 208
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7 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 22. There are location-based arrangements in place to cover for staff annual leave and absence. Each area has a list of casual staff to cover absences. Cleaning services advised that they often have difficulty recruiting cleaners for several different reasons, e.g. usually the hours are very small, it is very hard physical work, the Council only advertise posts on My Job Scotland, and many people don't actively look on this for cleaning jobs. Cleaning staff often work out of hours and are employed on the lowest pay grades and external cleaning companies may have more enhanced benefits. 37. Commercial Services maintain the Cleaning Manual, last updated August 2023. This is a working guide for managers and employees, it outlines the roles and responsibilities for cleaning, within Commercial Services. It is a practical reference tool to aid training and support compliance with clearly defined cleaning procedures. The manual sets out the health and safety standards and is the overarching document that other cleaning service processes and documents are sourced. 38. New employees are given an induction pack which contains: • Contact telephone numbers • Council Health and Safety Policies -links and overview, how to report incidents • General Health and Safety policies • HR procedures including holiday entitlement • Training Record card which should be signed by both the employee and the trainer • Details “toolbox talks” available. 39. Operations Officers provide induction training to all new employees and existing staff moving either location or changing type of establishment: • Explanations of all sections within the induction pack • Control of Substances Hazardous to Health Regulations (COSHH) training • A walk though of the establishment explaining the requirements on the cleaning schedule and materials to be used and location of the onsite Health and Safety folder. 40. Additional training after initial Induction training is only carried out if there have been changes to legislation, cleaning schedules, or products used. As cleaners undertake manual tasks that do not require access to the Council computer network, they are classed as non-network staff and have manual training records. 41. The On-Site Health and Safety folder contains employee training records. This folder is reviewed and updated biannually. All updates must be read and signed off by all cleaners. Operational Delivery Managers also collate a manual record of GDPR training as a check that non-networked staff have completed the training. No documentation was checked during this review. 42. From 1 April 2025, it is a legal requirement for individuals to be a member of the Disclosure Checks – Protecting Vulnerable Groups (PVG) scheme when carrying out a regulated role with children, protected adults, or both. This includes cleaning staff who work in schools and nurseries etc. 43. To comply with this legislation the Council carried out an organisation wide check of regulated roles and took steps to ensure that the individuals, currently employed, in those roles undertook the required level of Disclosure Checks and evidence of this is retained. The Council bore the costs associated with this exercise. Page 209
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8 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 44. The Cleaning Services Induction pack should be reviewed to ensure that it contains up to date links to key documents/ policies, reflects current working practices and if applicable, any changes to processes required as a result of the change to the PVG scheme. Action Plan 1 Cleaning standards are being utilised, and the quality of cleaning is monitored and reported regularly. 23. The cleaning service operates under a structured cleaning methodology that aligns with industry standards and best practices. This methodology outlines the processes, equipment, and materials to be used for different areas and ensures that all cleaning activities are carried out effectively and consistently. 24. The British Institute of Cleaning Science (BICs) is responsible for producing standards and educational frameworks for the cleaning industry. All cleaning staff and management undergo regular training and professional development, including BICSc -accredited training, to maintain high levels of competency and stay up to date with the latest cleaning techniques, health and safety requirements, and quality assurance standards. 25. Appropriate cleaning schedules and standards are in place to support the cleaning of council establishments where this is requested. The schedules vary depending on the Service occupying the establishment, examples include Pre 5 Nursery, Schools and offices. 26. Schedules are based on the structure cleaning methodology and are reviewed annually or as required and detail: • area to be cleaned, restricted to those that are accessible • description of what should be cleaned and frequency i.e. daily/weekly • description of cleaning activity that should be carried out • acceptable standards • description of what is not acceptable. 27. The cleaning service significantly reduced its cleaning specification in 2012 following the service choices exercise that was undertaken in 2010 and was subject to an independent review in 2016/17 as part of the Catering and Cleaning Service Choices review. This review noted that “the current hours and standards are at the lower end of acceptable, but meet the basic minimum requirements expected”. We have been advised by the service that this remains the case. 28. The current cleaning arrangements in schools and offices across the Council are historical, although, plans have been developed to review this going forward. Currently, in some cases, cleaning is carried out based on the customer request, i.e. 2 hours, 1 day per week. 29. Cleaning services have implemented a review of these historical arrangements. Plans are being developed to re-measure all cleaning premises and re-calculate the cleaning requirements to ensure the required standards are met. To facilitate this re-measure, it was necessary for some managers to have undertaken and completed the required BICs training. 30. In addition to the above, cleaning services are working together with the Education Management Team to update the cleaning schedules for Janitors and day cleaners, as this aspect Page 210
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9 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 of the service sits within Education. In order to prevent confusion regarding roles and responsibilities, it was agreed that job descriptions get reviewed at the same time. 31. To ensure that the Council’s cleaning schedules continue to meet industry standards, cleaning services managers conduct regular reviews and audits of cleaning practices against established benchmarks such as the BICs standards. The Operations Officers or Managers carry out ad- hoc spot check on premises on a regular basis. No documentation relating to this was reviewed. 32. The opportunity to feedback on the performance of the cleaning service is available to building users via customer satisfaction questionnaire forms. Responses are rarely received from internal clients e.g. schools or offices, as they usually email or phone if there is a problem and the operations officer or manager resolves any issues that have been highlighted. Any issues arising are discussed with the Senior Manager, Catering, Cleaning, Events and Food Strategy during the weekly catch up meetings with the two Operational Delivery Managers. 33. Due to the lack of returns of the current customer satisfaction questionnaire forms, this has not been included in the new performance dashboard. To try and boost engagement, cleaning services are considering the introduction of an online survey using MS Forms to capture feedback. 34. Commercial services submit data on the delivery of the cleaning service to an Annual Public Sector Excellence Building Cleaning (APSE) benchmarking exercise. APSE use this data and other benchmarking information to create an annual benchmarking report. The results of this are used to monitor performance year on year. The Council benchmark against similar Local Authorities but due to the logistical and unique issues in Argyll and Bute, benchmarking with another authority can be more complex. 35. Reporting of performance and issues for the cleaning servicers are discussed at the Commercial Services Teams meetings. No reports are currently provided to Council Committees. Page 211
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Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date Low 1 Induction Pack The Induction Pack contains out of date links and should be reviewed to ensure it reflects current working practices, and if applicable, reflect changes to the PVG scheme. New employees are not provided with access to relevant current Council policies and procedures. Induction pack to be reviewed and all links updated. Information on PVG changes will be added when available. Operational Delivery Manager 30 March 2026 Page 212
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11 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the council to achieve better value for money (VFM). Page 213
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12 Argyll and Bute Council – Internal Audit Report – Building Cleaning, November 2025 Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 214
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Argyll and Bute Council Internal Audit Report November 2025 FINAL High Medium Low VFM Number of Findings 0 6 0 0 Self-Directed Support Audit Opinion: Reasonable Page 215
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2 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 4 Key Dates ................................................................................................................................................ 4 Risks ........................................................................................................................................................ 5 Audit Opinion ......................................................................................................................................... 5 Recommendations ................................................................................................................................. 5 2. Objectives and Summary Assessment ........................................................................................... 6 3. Detailed Findings ............................................................................................................................ 8 Appendix 1 – Action Plan ..................................................................................................................... 12 Appendix 2 – Audit Opinion ................................................................................................................. 15 Contact Details Internal Auditor: Moira Weatherstone Telephone: 01546 604146 e-mail: moira.weatherstone@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 216
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3 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Scrutiny Committee in March 2025, we have undertaken an audit of Argyll and Bute Council’s (the Council) system of internal control and governance in relation to Self-Directed Support (Direct Payments) 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with council officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during the course of our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the Council. 3. The contents of this report have been agreed with the appropriate council officers to confirm factual accuracy and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. The Social Care (Self-directed Support) (Scotland) Act 2013 (the Act) which came into force on 1 April 2014, makes legislative provisions relating to the arrangement of care and support (“community care services” and “children’s services”) in order to provide a range of options to individuals as to how they are to be provided with their support. 5. After an assessment has been completed and if an individual meets the eligibility criteria, the allocated worker will discuss ways of meeting the assessed need and will explain the 4 options available under Self Directed Support. These are: • Option 1 – Direct Payment; • Option 2 – Direct your own support; • Option 3 – Services arranged for you by the Local Authority; • Option 4 – Mixture of the three above. 6. A Direct Payment (Self Directed Support) is an amount of money paid by Argyll & Bute Health & Social Care Partnership (HSCP) to enable individuals who meet the eligibility criteria to source their own care and support. Self-directed support is where a person takes responsibility for managing their own support, it is about giving people more choice on how their support services are designed and making sure they receive support that meets their needs. It allows people to choose how their support is provided to them by giving them as much ongoing control as they want over the money spent on their support. This can be by means of employing a personal assistant or an agency. 7. Self-directed support (SDS) aims to give individuals more flexibility, choice and control over their health and social care support and is based on five key principles: respect, fairness, freedom, safety and independence. Where an assessment has been undertaken and support needs Page 217
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4 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 identified, Social Work will discuss the support needs with the client and a support plan will be agreed and any financial contribution by the client will be discussed. 8. SDS can be used in many ways. A client can get support to live in their own home, such as help with having a bath or getting washed and dressed. Out of the home it could be support to go to college, to continue in employment or take a job, or to enjoy leisure pursuits more. Instead of relying on activities run at a day centre for example, the client could arrange for a personal assistant to help them attend local classes, go swimming, or be a volunteer helping others. It could also be used to provide respite or for equipment and temporary adaptations. 9. If a client has been assessed as being eligible for certain support needs, four options on how to receive services through SDS are available: • A direct payment that you can use to organise and pay for your own support; • SW can make arrangements for the support the client has chosen and if it is provided by someone other than the HSCP, the HSCP will pay the relevant contribution; • The HSCP can choose the best support for the client, make arrangements to set it up and if it is provided by someone other than the HSCP, the HSCP will pay the relevant contribution; • A combination of any of the above. 10. Within the Council area the HSCP currently provide around 200 Self Directed Support payments through a budget of £4,170,908 for 2024/25. This includes payments for supported living, respite, homecare and children with disabilities. The projected outturn at the end of March 2025 was £4,614,447. Scope 11. The scope of the audit was to review the assessment of processes in place for the checking of evidence, receipts and accounts for payment as outlined in the Terms of Reference agreed with the Chief Officer – HSCP on 18 June 2025. Key Dates 12. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted below. Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 18 June 2025 Fieldwork Commencement 19 June 2025 Draft Report issued 5 August 2025 Management Comments received 12 November 2025 Final Report issued 13 November 2025 Audit and Scrutiny Committee 16 December 2025 Page 218
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5 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 Risks 13. The risks considered throughout the audit were: • SRR07: Failure of the HSCP to deliver on its Strategic Priorities results in deteriorating health and wellbeing outcomes for the population and / or reduced access to appropriate health and social care services. This could also result in financial and reputational risk to the Council. • Audit Risk 1: failure to ensure that staff are provided with support and training to manage Self-Directed Support packages (Direct Payments) • Audit Risk 2: failure to have processes in place for checking documentation and accounts in respect to Direct Payments made Audit Opinion 14. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 15. Our overall audit opinion for this audit is that we can take a reasonable level of assurance. This means that internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Recommendations 16. We have highlighted six medium priority recommendations where we believe there is scope to strengthen the control and governance environment. These are summarised below: • Guidance within the Agreement document should be updated to include further information on the management of Direct Payments in terms of accumulated fund or the requirement to top up of funds, including details of the circumstances that would give rise to the repayment of funds. • The Self-Directed – ‘Option 1 Direct Payments Information – Supported Persons Guidance’ should be strengthened to include the statement that following financial review funds may be requested to be returned to the authority and in what circumstances. • Financial reviews should be completed in a timely manner with consideration being given to providing additional assistance to the Finance Officer – AWI to clear the outstanding backlog. • Process should be put in place to ensure Care Managers follow through and complete the recommendations in financial review memos. • Care Plans should be reviewed and kept up to date to ensure the Direct Payment remains appropriate. • A robust ‘single’ recording system should be put in place to ensure that there is a complete overview of when financial reviews are undertaken, when Care Plans are Page 219
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6 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 reviewed and when requests contained in the Memos following a financial review are completed. 17. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 18. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective. Exhibit 1 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion 1 Policies and procedures are in place for the management of Self- Directed Support (Direct Payments) SRR07 Substantial Policies and procedures are in place and are up to date. A policy and procedural document – Self Directed Support, Direct Payments Option 1, Policy and Procedural Guidance for Staff and Managers is available, the most recent version, V2.5 and is dated May 2025. The purpose of the policy is to reflect the provisions of The Self- directed Support (Direct Payment) (Scotland) Regulations 2014 which came into force on the 1st of April 2014 following the enactment of the Social Care (Self-directed Support) (Scotland) Act 2013. In addition, the policy informs the procedures outlined in Part B of the document which are applicable to all Social Work service users (“supported person”) and should be adopted by all staff. A leaflet – Option 2 Individual Service Funds (ISF) provides an outline guide to the four options available to client, providing further details for Option 2 which allows the client to direct Argyll and Bute Council to commission services from a support provider on your behalf. Information is available on the Council website. In addition, when supported people are being assessed they are provided with information on independent advice, advocacy, Community Contacts and Carers Centres. During the course of the audit, new guidance came into Page 220
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7 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 effect in July 2025 for the financial review of Direct Payments – ‘Staff Guidance – Direct Payment Finance Reviews’. This guidance is to be read in conjunction with the Self-Directed Support Direct Payments Option 1 Policy and Guidance. 2 Policies and procedures have been distributed to staff and training provided for the management of Self- Directed Support (Direct Payments) Audit risk 1 Substantial Policies, procedures, guidance documents and other relevant information is available for staff on the HSCP SharePoint site. Training is provided by the Self-Directed Support Officer. Training was previously undertaken face to face as group sessions with the Self-Directed Support Officer attending all areas and Islands throughout Argyll & Bute to deliver training for staff. As working from home practices have developed, training is now provided through the TEAMS platform. 3 Processes are in place for the checking of evidence, receipts and accounts relating to Self- Directed Support (Direct Payments) Audit Risk 2 Reasonable Processes and procedures are in place for the checking of financial records which require to be maintained by those in receipt of Direct Payments. A review timetable has been established and the Finance Administration Officer (AWI) has responsibility for undertaking these reviews. From a sample size of 205, testing was undertaken of thirteen Supported Person’s financial records and this highlighted that financial reviews had not been undertaken in accordance with the agreed timetable and there remains a significant backlog of case to review. It should be noted that the backlog of reviews is historical and that the Finance Administration Officer AWI inherited this work. Work is well underway, however, at the time of reporting there were 172 client financial records which have been received but were waiting to be reviewed. 19. Further details of our conclusions against each control objective can be found in Section 3 of this report. Page 221
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8 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 3. Detailed Findings Policies and procedures are in place for the management of Self-Directed Support (Direct Payments) 20. Policies and procedures are in place for the management of Self-Directed Support (Direct Payments). A policy and procedural document – Self Directed Support, Direct Payments Option 1, Policy and Procedural Guidance for Staff and Managers is in place, the most recent version, V2.5, dated May 2025. This is a two-part document with Part A being Option 1 – Direct Payment Policy (a payment which is made to a supported person which can be used to purchase support. The supported person can do this on their own or get help from family, friends and support organisations). Part B is the Direct Payment Procedural Guidance. 21. The purpose of the policy is to reflect the provisions of The Self-directed Support (Direct Payment) (Scotland) Regulations 2014 which came into force on the 1st of April 2014 following the enactment of the Social Care (Self-directed Support) (Scotland) Act 2013. In addition, the policy informs the procedures outlined in Part B of the document which are applicable to all social work service users (“supported person”) and is required to be adopted by all staff. The document should be read in conjunction with all other supporting documentation which is available on the Social Work SharePoint site. Roles and responsibilities are outlined in the document in the form of a flow chart. 22. The process for referral, determining eligible needs, support plan agreement and review are as per departmental processes and procedures for assessment, care management and eligibility criteria. 23. Option 1 Direct Payments Information Supported Person’s Guidance details background information, including the 4 Options available to those assessed with eligible needs. It explains what Direct Payments are, advises about the scheme, outlines the necessity to open a bank account for the specific purpose of receiving the payment and details how the payments can be used. It outlines that all bank statements, letters and cheque books for the account must be kept and that there is an expectation that these are made available to Social Work Services for the purpose of monitoring the account. It further clarifies that the account will be reviewed regularly at intervals designated by the HSCP and that if funds in the Direct Payment account total more than the 2 months’ contingency allowed, the excess funds will require to be returned to Argyll & Bute HSCP. 24. During the course of the audit, new guidance came into effect in July 2025 for the financial review of Direct Payments – ‘Staff Guidance – Direct Payment Finance Reviews’. This guidance is to be read in conjunction with the Self-Directed Support Direct Payments Option 1 Policy and Guidance. 25. Information is available on the Council website. In addition, when a supported person is being assessed they are provided with information on independent advice, advocacy, community contacts and Carers Centres. Two documents and a leaflet are provided to individuals which give comprehensive guidance on Self-Directed Support, including the management of the payment. The Self-Directed Support Officer provides comprehensive information on Self Directed Support Page 222
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9 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 at an ‘in person’ or online meetings with anyone considering a Direct Payment option. Ongoing support is provided, as necessary by the Self-Directed Support Officer. Policies and procedures have been distributed to staff and training provided for the management of Self-Directed Support (Direct Payments) 26. Policies, procedures, guidance documents as detailed above, along with other relevant information is available for staff on the HSCP SharePoint site. A staff survey was undertaken to gauge the understanding, awareness and accessibility of documents relating to Direct Payments and although the survey response rate was low there was some assurance that staff know where to access information or get support from the results produced. 27. Training is provided by the Self-Directed Support Officer. Training was previously undertaken face to face as group sessions with the Self-Directed Support Officer attending all areas and Islands throughout Argyll & Bute to deliver training for staff. As working from home practices have developed, training is now provided through the TEAMS platform. Processes are in place for the checking of evidence, receipts and accounts relating to Self- Directed Support (Direct Payments) 28. Everyone in receipt of a Direct Payment is required to sign a legally binding Direct Payment Agreement. The agreement places responsibility and obligations upon the supported person and the HSCP to ensure that appropriate funding is provided regularly to meet the needs of the individual and that they spend the funding they receive appropriately and in terms of their Care Plan. The Supported Person is accountable to the HSCP for how the Direct Payment money is spent and are expected to provide evidence they have spent the funding as agreed. If in any circumstances the Direct Payment stops and it is assessed there has been an overpayment of monies, then there is an obligation that the supported person will be required to repay the overpayment to us. Action Plan 1 29. Supported Persons are provided with a document ‘Option 1 Direct Payments Information – Supported Persons Guidance’. This document provides comprehensive information on Self- Directed Support and the management of payments. It details the responsibilities in terms of Argyll & Bute HSCP being accountable for public funds and its responsibilities to monitor direct payments to ensure they are spent appropriately and that they represent cost effective use of resources. The Guidance provides clarity in terms of the requirement to keep a range of financial documentation and provide the HSCP with financial information on their Direct payments at designated intervals. The guidance also states that if the Direct Payment agreement is terminated either by the supported person or by Argyll & Bute HSCP or if the supported person is deceased all unspent funds must be returned to Argyll & Bute HSCP. Action Plan 2 30. For financial and monitoring purposes, the Supported Person must record of all income and expenditure on the Direct Payment bank account statements. All items of expenditure must be recorded separately on a template Financial Return Form, which is provided. For each separate payment made: Page 223
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10 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 • the date of payment; • person/organisation to whom the payment is being made (payee) • the nature of the payment; • cheque number (if appropriate) and • the total amount must be recorded. In addition, for each item of expenditure recorded there must be an invoice or a receipt to support the payment made, this must be kept up to date. A financial review timetable has been established with clear timeframes published. 31. Where appropriate employment records (PAYE, National Insurance, Liability Insurance etc.) for all the carers/ personal assistants employed or contracted by supported person must be kept. Time sheets (or rotas) indicating the days and times carers have worked should be submitted when a financial review is requested. However, a number of Supported Persons use the services of a payroll company who maintains responsibility for the management of employment, including managing timesheets and payroll. 32. Statutory guidance to accompany the Social Care (Self-directed Support) (Scotland) Act 2013 states that depending on the circumstances surrounding any decision to terminate a direct payment the local authority may need to decide if it is appropriate to seek recovery of unspent funds. The legislation enables the authority to require some or all of the money they have paid out to be repaid if it is not satisfied that it has been used to secure the support to which it relates. The Council is required to take into account hardship considerations in deciding whether to seek repayments. In addition, the Social Work Finance Team will review bank balances prior to the end of the financial year, or at any reasonable time, and may seek to reclaim any excess funds held. 33. From a sample size of 205, testing was undertaken of thirteen Supported Person’s financial records and this highlighted that financial reviews had not been undertaken in accordance with the agreed timetable and there remains a significant backlog of case to review. Work is well underway, however, at the time of reporting there were 172 client financial records which have been received but were waiting to be reviewed. The testing of records identified there were instances where: • Supported persons’ not using their full assessed hours resulting in accumulation of funds in the Direct Payment bank account; • Supported Persons paying over the agreed hourly rate for a service and whereby this is acceptable, additional funds must be repaid to the Direct Bank Account by the Supported Person. Testing of records showed that additional funds were not being paid to cover the additional costs and that advanced payments provided by the Council were used to cover the deficit; • One record highlighted that there was unauthorised use of the Self-Directed Support payment which was being used to fund everyday bills; • Supported persons paying over the agreed hourly rate for services, whilst not using the full assessed hours resulting in accumulation of funds in the Direct Payment bank account; Page 224
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11 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 • Overspending on agreed hourly rates and above assessed hours whilst not topping up the Direct Payment bank account, placing reliance on advance payments to cover ongoing costs. Action Plan 3 34. If, during the review of the Supported Persons financial records it is identified that there is an accumulation of funds, funds not being used as agreed in the care plan or funds not being ‘topped up’ in the bank account to cover additional care costs, a memo is sent to the Care Manager to action and follow up. During the process of testing of records, it was noted that there was evidence that recommendations in Memos issued to the Care Mangers had not been followed up. Action Plan 4 35. The Direct Payment Policy and Guidance document states that reviews will be undertaken to ensure that the supported person’s needs are being met and that the Direct Payments arrangements continue to be appropriate and that it is essential the Care Manager communicates directly with the supported person where possible to ensure that they are happy with the arrangements. Of the records reviewed, four records were recently set up with up-to- date Care Plans, four records Care Plans had been reviewed in 2025, two records were due for review and two records were overdue. Action Plan 5 36. We were unable to establish if all Direct Payment Care Plans had been reviewed and were up to date. All Direct Payment service agreements continue to be updated and recorded in Carefirst with any Direct Payment financial reviewing taking place off system and uploaded and recorded in CIVICA (there is nothing is updated in ECLIPSE, the replacement for Carefirst). Any updates to Direct Payment Care Plans are recorded and updated in CIVICA. ECLIPSE Finance Module (EFM) processes have not been embedded in the Council and EFM has not yet been adopted. Once live, this would allow for the linkage of referrals, assessments, reviews to care plans and care service agreements and financial reviews as the Finance Summary screens would have the relevant EFM worklists, forms and tasks populated. Action Plan 6 Page 225
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Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date Medium 1 Direct Payment Agreement Everyone in receipt of a Direct Payment is required to sign a legally binding Direct Payment Agreement. The agreement places responsibility and obligations upon the supported person and the HSCP to ensure that appropriate funding is provided regularly to meet the needs of the individual and that they spend the funding they receive appropriately and in terms of their Care Plan. However, the Agreement is not clear enough what funds require to be returned in certain circumstances. Supported Persons may not be fully aware of the obligation to return funds The Direct Payment guidance relating to the section on unspent funds will be updated and the new guidance will be available on SharePoint and the website. Self-Directed Support Officer Date: 31 December 2025 Medium 2 Guidance Document Supported Persons are provided with a document ‘Option 1 Direct Payments Information – Supported Persons Guidance’. This document provides comprehensive information on Self-Directed Support and the management of payments. However, the Guidance document does not provide clear guidance on the circumstances which would give rise to the requirement to ‘top up’ the Direct Payment bank account or circumstances whereby accumulated funds require to be returned. Supported Person may not be aware that the Direct Payment bank account requires to be topped up or that accumulated funds would need to be returned The Direct Payment guidance relating to information on the topping up of funds will be updated to ensure clarity and the new guidance will be available on SharePoint and the website. Self-Directed Support Officer Date: 31 December 2025 Medium 3 Financial Reviews From a sample size of 205, testing was undertaken of thirteen Supported Person’s financial records and this highlighted that financial reviews had not been undertaken in accordance with the agreed timetable and there remains a significant backlog of case to review. Recovery of funds delayed, or Direct Payment bank accounts are not topped up as required Discussions to be held with Head of Finance about what extra resource can be provided to clear back log of cases. Since issuing the draft audit report an additional temporary member of staff has been appointed for one year. Social Work Amin Manager Date: Completed Page 226
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13 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 No Finding Risk Agreed Action Responsibility / Due Date Medium 4 Follow up Actions During the process of testing of records, it was noted that there was evidence that recommendations in Memos issued to the Care Mangers had not been followed up. Where recommendations or advice from practice leads/team managers are not followed there is a risk that inaccurate information is provided to individuals or actions not carried out which could result in the Legislation not being implemented placing the organisation at risk. This finding will be highlighted and shared with Service Managers and Team Managers to ensure that the message is communicated clearly to Social Work staff to take account of any advice and guidance in a complex area of practice and are fully aware of their responsibility to collaborate with practice leads and senior staff to ensure their practice is to the standard expected and achieves the best outcomes for the individual. Head of Hospitals and Community Care Date: 31 December 2025 Medium 5 Care Plans The Direct Payment Policy and Guidance document states that reviews will be undertaken to ensure that the supported person’s needs are being met. Of the records reviewed, four records were recently set up with up-to- date Care Plans, four records Care Plans had been reviewed in 2025, two records were due for review, and two records were overdue. Care Plans do not align with the Direct Payments A process of self-evaluation, through case file reviews, twice yearly, will be implemented by each locality to monitor performance and benchmark against other localities. Head of Hospitals and Community Care Date: 31 December 2025 Medium 6 Supported Persons Records We were unable to establish if all Direct Payment Care Plans had been reviewed and were up to date due to the multiple ways in which the Supported Persons’s records are maintained. Care Plans and financial reviews are at greater risk of not aligning, this can also result in excessive build-up of unused funds and greater risk of money not being used as intended. A process of self-evaluation, through case file reviews, twice yearly, will be implemented by each locality to monitor performance and benchmark against other localities. Head of Hospitals and Community Care Date: 31 December 2025 Page 227
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14 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the council to achieve better value for money (VFM). Page 228
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15 Argyll and Bute Council – Internal Audit Report – Self-Directed Support, November 2025 Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 229
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Argyll and Bute Council Internal Audit Report November 2025 FINAL High Medium Low VFM Number of Findings 0 0 0 0 Oban Airport Audit Opinion: High Page 231
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2 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 CContentss 1. Executive Summary........................................................................................................................3 Introduction............................................................................................................................................3 Background.............................................................................................................................................3 Scope.......................................................................................................................................................4 Risks........................................................................................................................................................4 Audit Opinion.........................................................................................................................................4 2. Objectives and Summary Assessment...........................................................................................4 3. Detailed Findings............................................................................................................................6 Appendix 1 –Audit Opinion...................................................................................................................9 Contactt Detailss Internal Auditor: Leanne Rennie Telephone: 01369 708516 e-mail: Leanne.rennie@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 232
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3 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 11. Executivee Summaryy Introductionn 1. As part of the 2025/26 Internal Audit Plan, approved by the Audit & Scrutiny Committee in March 2025, we have undertaken an audit of Argyll and Bute Council’s (the Council) system of internal controland governance in relation to Oban Airport. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with council officers and the information available at the time the fieldwork was performed. The findingsoutlined in this report are only those which have come to our attention during the course of our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the Council. 3. The contents of this report have been agreed with the appropriate council officers to confirm factual accuracy and appreciation is due for the cooperation and assistance received from all officers overthe course of the audit. Backgroundd 4. Oban Airport is one of three aerodromes operated by the Council, and licensed under Article 211 of the ANO 2009 by the Civil Aviation Authority (CAA). Deemed as a Public Service Obligation (PSO),scheduled services, and scholar flights for island school children, operate from Oban airport to Coll, Colonsay, Islay and Tiree. Additionally, the airport deals with chartered traffic and military flights as well as general aviation traffic such as medevacs, coastguard operations, training flights and scenic tours by private operators. 5. Prior to the grant of a licence and for continued licensing, the CAA requires the Aerodrome Operator to meet the minimum standards detailed in CAP168 Licensing of Aerodromes. CAP 168 setsout the standards required at UK national licensed aerodromes relating to management systems, operational procedures, physical characteristics, assessment and treatment of obstacles, visual aids, rescue and fire-fighting services and medical services. 6. The Oban Airport Aerodrome Manual (the Manual) provides information about the airport, its systems for managing safety and the required operational procedures. The Airport Rescue & Fire Fighting Service (RFFS) manual provides guidance on the agreed policy and procedures designed to achieve an effective and efficient RFFS. Both manuals are derived from CAP168. 7. Oban Airport operate the ‘Redkite Equipment Management system’ which is used in all UK airports to help ensure they meet the requirements of the CAA in regard to RFFS personnel and equipment. 8. The overall remit of internal audit is to provide assurance over compliance with the 25 airport operating instructions (AOIs) established by the Manual and the further procedures established by the RFFS manual. Page 233
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4 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 SScopee 9. The scope of the audit was to provide assurance over compliance with six of the airport operating instructions (AOIs) established by the Manual and the further procedures established by the RFFS manual as outlined in the Terms of Reference agreed with the Oban Airport Station Manager. The operating instructions audited on 18th September 2025 are as follows: x AOI 16 – Aerodrome Safeguarding x AOI 17 –Recovery of Disabled Aircraft x AOI 18 –Recording Aircraft Movements x AOI 19 – Accident, Incident and Occurrence Reporting x AOI 20 – Aerodrome Ground Maintenance x AOI 24 –Cranes & Tall Equipment in vicinity of Aerodrome Riskss 10. The risks considered throughout the audit were: x Audit Risk 1 - Failure to comply with operating instructions could result in increased risk of accidents and/or the airport losing its CAA licence Auditt Opinionn 11. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 12. Our overall audit opinion for this audit is that we can take a HIGH level of assurance. This means that internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. 2. Objectivess andd Summaryy Assessmentt 13. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective Exhibit 1 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion CO1 The Manual, setting out the operational procedures of the airport, is up to date, appropriate and accessible to all relevant staff. Audit Risk 1 High The Manual is updated annually and is available to appropriate officers and published on the Council’s intranet site, the Hub. The document was found to be comprehensive with each section outlining the Council policy for compliance with regulations and procedures. Page 234
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5 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 Control Objective Link to Risk Assessment Summary Conclusion CO2 AOI16 – Aerodrome Safeguarding - reasonable steps are taken to keep the airport and its airspace safe at all times for use by aircraft. Audit Risk 1 High There is a safeguarding map which details the specific area which fall under the safeguarding requirements, and external contractors are issued with guidance when working within the safeguarding area. CO3 AOI17 – Recovery of Disabled Aircraft - measures are in place to remove disabled aircraft without disrupting the safety of the airport. Audit Risk 1 High It is the responsibility of aircraft owners to remove disabled aircraft to a safe area. The Council has facilities if the owner requires assistance. CO4 AOI18 – Recording Aircraft Movements – the airport complies with operating instruction to record movements. Audit Risk 1 High Aircraft movements are compiled by the Aerodrome Flight Information Service Officer (AFISO), or during busy periods by another crew member and are recorded appropriately. CO5 AOI19 – Accident, Incident and Occurrence Reporting - the airport complies with the operating instructions to report accidents, incidents and occurrences. Audit Risk 1 High Accidents, incidents and occurrences associated with the operation of an aircraft are reported appropriately internally and externally. All reports are recorded internally on the airport database. CO6 AOI20 – Aerodrome Ground Maintenance - the airport complies with the ground maintenance programme. Audit Risk 1 High Ground maintenance procedures have been designed to ensure there is a system in place to maintain the airfield to a suitable standard. CO7 AOI24 – Cranes & Tall Equipment in vicinity of Aerodrome –the airport complies with the operating instructions regarding tall equipment & cranes. Audit Risk 1 High Tall Equipment and Cranes must apply for a permit 14 days prior to the planned operation. 14. Further details of our conclusions against each control objective can be found in Section 3 of this report. Page 235
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6 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 33. Detailedd Findingss The Manual, setting out the operational procedures of the airport, is up to date, appropriate and accessible to all relevant staff 15. The Manual is available to all relevant personnel onthe Council HUB with a hard copy held onsite atthe airport. Each section within the Manual sets out: x the Council’s policy and established procedures to ensure compliance with relevant rules and/or regulations x appropriate monitoring arrangements (where applicable) x roles and responsibilities of relevant personnel. 16. The Manual is reviewed annually by the Station Manager and was last updated in July 2025. The updated version is submitted to the CAA who have 28 days to highlight any queries on the Manual’s content. If no response is received in 28 days, then the revised Manual is adopted. The current Manual is version 8.7. 17. The CAA document CAP 168 sets out the standards required at UK National licensed aerodromes relating to management systems, operational procedures, physical characteristics, assessment and treatment of obstacles, visual aids, rescue and fire-fighting services and medical services. 18. When updating the Manual, the Station Manager ensures that it reflects any updates or revisions as published by the CAA. A check of the CAA website found that there has been no alterations, other than formatting, to the CAP 168 document since January 2022. 19. The CAA carry out periodic on-site audits to verify continued compliance with national licensing requirements. The latest inspection was June 2025; we have been provided with findings and responses to date. All reasonable steps are taken to always keep the airport and its airspace safe for use by aircraft. 20. The CAA requires that the airport and its airspace are always safe for use by aircraft. This is detailed in CAP 738 “Safeguarding of Aerodromes”. The station manager is responsible for aerodrome safeguarding. 21. Oban airports all have a safeguarding map which has been lodged with planning services which details the specific area which falls within the safeguarding requirements. All planning applications within this area should meet the CAP 738 requirements and must be notified to relevant airport personnel. We have been provided with a copy of the latest planning application. 22. External contractors have been issued with guidance when working within the safeguarding area to ensure that the requirements of CAP 738 are met. Measures are in place to remove disabled aircraft without disrupting the safety of the airport. 23. In the event of an aircraft becoming disabled it is the responsibility of the aircraft owner to remove the aircraft to a safe distance. To facilitate this, the airport has a “tug” or if this not suitable they can advise the owner of a suitable contractor. If the aircraft is disabled in a hazardous area,the airport will ensure that the aircraft is removed as soon as possible. If the runway is required to be closed, then a NOTAM will be issued. There have been no recordings of disabled aircraft for several years. Page 236
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7 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 The airport complies with the operating instructions to record Aircraft movements 24. CAP168 Licensing of Aerodromes requests that all aircraft movements are to be recorded. The following is recorded: x aircraft type and registration x flight number x type of flight x destination or departure aerodrome x time of departure/arrival x aircraft operator x number of persons on board 25. Aircraft movements are compiled by the Aerodrome Flight Information Service Officer (AFISO), or during busy periods by another crew member. Aircraft movements are recorded appropriately on the airport database. The airport complies with the operating instructions to report accidents, incidents and occurrences 26. The Aerodrome Safety Management System outlines the principle and purpose of accident and incident reporting. Additionally, there are mandatory requirements for reporting accidents and incidents. 27. The Manual states that the Station Manager is responsible for: x all incidents are investigated x a no blame philosophy is pursued x all mandatory reporting procedures are followed in a timely manner x radio transmission frequencies (RTF) are retained x appropriate steps are taken to circulate the findings of accident/incident investigations 28. The Manual requires the duty AFISO to make verbal and written reports. All reports are recorded internally on the airports database. External reports are made directly to the UK Aircraft Accident Investigation Branch (AAIB). All matters reported to the AAIB/CAA culminate in formal reports which are available to the public and staff. The Airport complies with the ground’s maintenance programme 29. Ground Maintenance procedures are in place to ensure there is a system to maintain the airfield to a suitable standard, incorporating: x grass cutting x strimming x weed and moss control x perimeter fence maintenance x egress gate access 30. The Manual states that prior to operating any item of equipment, sufficient training must be carried out on each item, and the Station Manager must be satisfied with the competence of the operator before allowing them to operate the equipment. Personnel are suitably trained by colleagues and are permitted to use the tractor and attachments once proficient. Page 237
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8 Argyll and Bute Council – Internal Audit Report –Oban Airport, November2025 31. The Manual states that knapsack sprayersmust only be used by personnel in possession of the relevant PA1 and PA6 certification, two members of staff currently hold this certification. Cranes & Tall Equipment in vicinity of Aerodrome –the airport complies with the operating instructions regarding tall equipment & cranes. 32. Operators intending to use cranes or tall equipment within 6 kilometers of an aerodrome boundary, where the height exceeds 10 meters above ground level (AGL) or the height of surrounding structures or trees, must apply for a Crane/Tall equipment permit using ‘Crane Permit FM01’ within the stated time frame. 33. The Manual states that the Station Manager is responsible for assessing all crane/tall equipment requests and has the right to refuse applications that are not submitted within the time frame and/or are deemed a hazard to the aerodrome. Appropriate documentation was retained in compliance with this requirement. Page 238
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9 Argyll andBute Council –Internal Audit Report –Oban Airport, November2025 AAppendixx 11 –– Auditt Opinionn Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives isin place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst notdisplaying a general trend, thereare areas of concern which have been identified where elements of residual riskor weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptablelevel andplacing system objectives are at risk. W eakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 239
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Argyll & Bute Health & Social Care Partnership Internal Audit Report September 2025 FINAL High Medium Low VFM Number of Findings 0 0 2 0 Review Of Governance Arrangements Audit Opinion: High Page 241
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2 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 3 Key Dates ................................................................................................................................................ 3 Risks ........................................................................................................................................................ 4 Audit Opinion ......................................................................................................................................... 4 Recommendations ................................................................................................................................. 4 2. Objectives and Summary Assessment ........................................................................................... 4 3. Detailed Findings ............................................................................................................................ 5 Appendix 1 – Action Plan ....................................................................................................................... 9 Appendix 2 – Audit Opinion ................................................................................................................. 11 Contact Details Internal Auditor: David Sullivan Telephone: 01546 604125 e-mail: David.sullivan@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 242
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3 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Risk Committee in February 2025, we have undertaken an audit of Argyll & Bute Health & Social Care Partnership (HSCP) system of internal control and governance in relation to Review of Governance arrangements. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with Health & Social Care Partnership officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the HSCP. 3. The contents of this report have been agreed with the appropriate Health & Social Care Partnership officers to confirm factual accuracy, and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. The purpose of this audit is to ensure that the governance framework remains fit for purpose, complies with good practice standards, and is reviewed regularly. 5. The governance structure of the HSCP includes the Integration Joint Board (IJB), sub- committees, and partnership arrangements with NHS Highland and Argyll & Bute Council. This audit supports the HSCP’s commitment to continuous improvement, transparency, and accountability in decision-making processes. Scope 6. The scope of the audit was to provide assurance that the HSCP’s governance arrangements are periodically reviewed and fit for purpose as outlined in the Terms of Reference agreed with the Head of Service and Transformation on 12th May 2025. Key Dates 7. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted in Exhibit 1 below. Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 12th May 2025 Fieldwork Commencement 15th June 2025 Draft Report issued 11th July 2025 Management Comments received 18th July 2025 Final Report issued 8 September 2025 Audit and Risk Committee 23 September 2025 Page 243
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4 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Risks 8. The risks considered throughout the audit were: • SRR04: Governance and Leadership – risk that governance arrangements are not conducive to effective working. • Audit Risk 1: Governance documents are not reviewed regularly or are outdated. • Audit Risk 2: Roles and responsibilities of key decision-makers are unclear or inconsistently understood. • Audit Risk 3: Governance decisions are not transparent or appropriately documented. • Audit Risk 4: The Integration Joint Board (IJB) make decisions that are out with its legal powers (ultra vires), potentially leading to legal or financial repercussions. Audit Opinion 9. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 10. Our overall audit opinion for this audit is that we can take a high level of assurance. This means that Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Recommendations 11. We have highlighted 2 low priority recommendations where we believe there is scope to strengthen the control and governance environment. These are summarised below: • A governance roles guide and organisational chart should be developed to clarify officer responsibilities and committee reporting lines. • Information on IJB member training and induction should be published to enhance transparency for stakeholders and potential board members. 12. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 13. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective. Page 244
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5 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Exhibit 2 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion CO1 Governance documents are reviewed periodically and updated accordingly SRR04 / Audit Risk 1 Audit Risk 4 High The HSCP governance framework is well-documented, formally approved, and reviewed in accordance with statutory and good practice standards. Evidence from IJB minutes confirms oversight and review activity has been performed. The existence of formal schedules and version controls supports ongoing governance arrangements. CO2 Roles and responsibilities within the governance structure are clearly defined and understood. Audit Risk 2 High The governance structure and responsibilities within the Argyll & Bute HSCP are clearly laid out in governance documents and reflect good practice. While role clarity is strong, additional improvements could be made by enhancing accessibility and communication of these responsibilities and training expectations CO3 Governance meetings are properly documented, and decisions are transparent and traceable. Audit Risk 3 High The HSCP’s governance framework promotes transparency, stakeholder accessibility, and clear documentation of decisions. Strategic plan performance and audit recommendations are actively monitored. Governance interactions between the IJB, Council, and NHS Highland are well-established. The IJB prepares an Annual Governance Statement. 14. Further details of our conclusions against each control objective can be found in Section 3 of this report. 3. Detailed Findings Governance documents are reviewed periodically and updated accordingly 15. The Joint Strategic Plan (2022–2025) sets out the HSCP’s vision, priorities, and integrated service delivery objectives over a three-year period. Developed following a formal consultation process, it defines governance principles, planning cycles, and performance expectations. The document outlines the governance responsibilities of the Integration Joint Board, the Chief Officer, and strategic partners, and is aligned with national health and social care integration policy and the Public Bodies (Joint Working) (Scotland) Act 2014. 16. The HSCP has a well-documented governance framework comprising all key components expected under statutory and good practice standards. These include the IJB Standing Orders Page 245
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6 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 (v3.4, approved January 2025), committee Terms of Reference (v2.4), the Integration Scheme, and the 2022–2025 Joint Strategic Plan. Collectively, these documents define governance procedures, membership structures, delegated authority, and partnership responsibilities. They are subject to regular review, include version control, and are publicly accessible, supporting transparency and accountability. 17. The Standing Orders (v3.4, January 2025) provide a comprehensive and up-to-date procedural framework for the Integration Joint Board. They clearly define the governance structure, including the distinction between voting and non-voting members, and outline key responsibilities for the Chair, Vice Chair, and Chief Officer. The document includes detailed provisions on decision-making, quorum, delegation of functions, and the conduct of meetings. The inclusion of version control and regular review cycles further demonstrates alignment with national policy and good governance practice. 18. The key governance documents of the HSCP have all been formally reviewed and approved within appropriate statutory and operational timeframes. The Standing Orders (v3.4) were reviewed and approved in May 2025, with version control confirming a biennial review cycle. The Strategic Plan 2022–2025 was approved in 2022 and remains current, with provisions for a mid-cycle review if required. The Integration Scheme was last reviewed in 2021 and approved by Scottish Ministers, with the next review due by 2026. The Terms of Reference for IJB committees (v2.4) were reviewed and approved in March 2025. These approvals are documented in official IJB minutes, and all documents contain version controls and embedded review schedules, evidencing structured and compliant governance oversight. 19. All core governance documents include version control and scheduled review cycles. These align with statutory expectations: five years for the Integration Scheme, three years for the Strategic Plan, and annual review for committee Terms of Reference. Roles and responsibilities within the governance structure are clearly defined and understood. 20. The audit reviewed the governance framework, key documentation, and training provisions to assess whether the roles and responsibilities of key officers and committees are clearly defined and communicated. 21. The roles and responsibilities of key officers within the HSCP are clearly defined and consistently communicated through core governance documents, including the Standing Orders (v3.4), Strategic Plan 2022–2025, and Integration Scheme. The Chief Officer is designated as the lead accountable officer, with responsibilities covering strategic delivery, operational oversight, and liaison with partner bodies. The Standing Orders also outline the duties of the Chair and Vice Chair, including meeting leadership and adherence to procedural standards, as well as the functions of the Standards and Monitoring Officers in relation to conduct and compliance. These responsibilities are further reinforced through board appointments and formal reporting. These arrangements promote transparency, accountability, and clarity of governance roles. A summarised governance roles guide or organisational chart could further improve accessibility for stakeholders and new members. Action Plan 1 22. The structure of the IJB and its subcommittees is clearly defined and aligned with good governance practice. The Standing Orders detail the governance framework, including Page 246
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7 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 membership composition, quorum rules, decision-making processes, and provisions for establishing subcommittees. Key roles and delegation arrangements are stated, supporting accountable leadership and operational delivery. The Strategic Plan further reinforces this structure, highlighting the roles of strategic and operational committees, such as the Finance and Audit Committee. The governance model reflects best practice, with defined responsibilities, clear reporting lines, and a Chief Officer accountable to both partner organisations. To enhance accessibility, a visual governance chart showing committee relationships and officer accountabilities could be developed to support stakeholder understanding. Action Plan 1 23. The governance structure is well defined, comprising strategic oversight by the IJB, operational delegation to the Chief Officer, and supporting subcommittees for finance, audit, clinical governance, and strategic planning. 24. Subcommittees have documented Terms of Reference, reviewed and approved by the IJB in March 2025, outlining purpose, responsibilities, membership, and reporting lines. 25. The IJB has established appropriate arrangements for the induction and ongoing development of its members. New members are supported through structured induction programmes and board development sessions to ensure they understand their roles and responsibilities within the governance framework. The Strategic Plan confirms that Performance Development and Review (PDR) schemes are in place through each partner agency, promoting individual growth aligned with organisational objectives. In addition, the HSCP offers a range of accessible training courses on key topics such as mental health and suicide prevention, which are open to both staff and IJB members. These arrangements reflect a strong commitment to maintaining effective governance participation. Publishing further detail on induction and training provisions via the IJB’s website could enhance visibility and support stakeholder engagement. Action Plan 2 Governance meetings are properly documented, and decisions are transparent and traceable. 26. The audit reviewed whether governance decisions of the HSCP are transparent, accessible to stakeholders, and supported by clear reporting, oversight structures, and assurance mechanisms. 27. Governance documentation, including IJB agendas, reports, and minutes, are routinely published via the Argyll and Bute Council website. Reports typically include background, options, decisions, and recommendations in full, supporting public accountability. Agendas, reports, and approved minutes are routinely published on the Argyll and Bute Council website in a dedicated IJB section, ensuring that stakeholders can access key decisions, background papers, and recommendations in a timely manner. The Standing Orders reinforce this approach by explicitly supporting open meetings, in line with statutory obligations under the Public Bodies (Joint Working) (Scotland) Act 2014. Examples such as the 27 March 2024 meeting confirm that governance decisions are documented and presented in an accessible format. These practices promote visibility, trust, and effective stakeholder engagement. 28. Governance arrangements between the HSCP, Argyll and Bute Council, and NHS Highland are underpinned by the Integration Scheme and Standing Orders, which clearly define the statutory Page 247
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8 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 delegation of functions and responsibilities. The Chief Officer is jointly accountable to the IJB and both partner organisations, ensuring that strategic decisions are implemented across NHS and Council structures. While the IJB determines strategic direction and budget allocations, operational delivery remains with the parent bodies. This model is supported by joint oversight mechanisms and shared reporting through audit and governance structures. 29. The IJB complies with statutory requirements by preparing, reviewing, and publishing an Annual Governance Statement (AGS) as part of its audited annual accounts. The 2023–24 AGS, approved on 26 March 2025, provides a comprehensive summary of the IJB’s governance arrangements and internal control environment. It is subject to both internal review and external audit scrutiny, with the auditor confirming that the statement fairly reflects the IJB’s risk assurance and governance framework. This process offers assurance to stakeholders regarding the effectiveness and transparency of governance practices within the HSCP. 30. The HSCP has established governance arrangements to support strategic risk management. The Strategic Risk Register (SRR) was formally reviewed and approved by the Leadership Team and the Audit & Risk Committee in December 2024, with subsequent scrutiny by the Integration Joint Board in January 2025. The SRR is actively aligned to the Joint Strategic Plan through a structured mapping exercise, demonstrating how key risks relate to strategic objectives. Overall, the risk governance framework is compliant, well-documented, and subject to regular review, reinforcing effective risk-informed decision-making at a strategic level. Page 248
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Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date Low 1 A summarised governance guide, including an organisational chart that outlines officer responsibilities and committee reporting lines, would improve accessibility for new members and external stakeholders. Without a clear and accessible governance guide, there is a risk that new members, staff, and stakeholders may lack a full understanding of roles, accountability structures, and decision-making processes. HSCP will develop a concise governance summary guide, including officer responsibilities and reporting lines. Business Improvement Manager 30th April 2026 Low 2 While training provisions are evident, details of IJB member training and induction are not currently published publicly. This limits transparency for stakeholders and potential board members. The absence of publicly available information on IJB member training and induction may reduce stakeholder confidence in governance capability and discourage potential candidates from engaging with the IJB. HSCP will on an ongoing basis publish a summary of the training and induction programme provided to IJB members, including any development opportunities Business Improvement Manager 30th April 2026 Page 249
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10 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the HSCP to achieve better value for money (VFM). Page 250
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11 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 251
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Argyll & Bute Health & Social Care Partnership Internal Audit Report August 2025 FINAL High Medium Low VFM Number of Findings 0 0 3 0 Partnership Working Audit Opinion: High Page 253
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2 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 3 Key Dates ................................................................................................................................................ 3 Risks ........................................................................................................................................................ 4 Audit Opinion ......................................................................................................................................... 4 Recommendations ................................................................................................................................. 4 2. Objectives and Summary Assessment ........................................................................................... 4 3. Detailed Findings ............................................................................................................................ 7 Appendix 1 – Action Plan ..................................................................................................................... 12 Appendix 2 – Audit Opinion ................................................................................................................. 15 Contact Details Internal Auditor: David Sullivan Telephone: 01546 604125 e-mail: David.sullivan@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 254
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3 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Risk Committee in February 2025, we have undertaken an audit of Argyll & Bute Health & Social Care Partnership (HSCP) system of internal control and governance in relation to Partnership Working. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with Health & Social Care Partnership officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during the course of our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the HSCP. 3. The contents of this report have been agreed with the appropriate Health & Social Care Partnership officers to confirm factual accuracy, and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. This audit focused on the effectiveness of joint working between the HSCP and its main partner, Argyll and Bute Council, to deliver integrated services. 5. The integration of health and social care services requires strong and effective collaboration between partner organisations. This promotes clarity of roles, shared objectives, and effective decision-making processes which are essential to achieving successful outcomes for service users. This review supports assurance against Strategic Risk Register item SRR05. Scope 6. The scope of the audit is to provide assurance that partner organisations, primarily Argyll and Bute Council, are working effectively with HSCP as outlined in the Terms of Reference agreed with the Head of Finance and Transformation, Health and Social Care Partnership on 28th April 2025. Key Dates 7. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted in Exhibit 1 below. Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 28th April 2025 Fieldwork Commencement 1st May 2025 Draft Report issued 5th August 2025 Management Comments received 11th August 2025 Final Report issued 8 September 2025 Audit and Risk Committee 23 September 2025 Page 255
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4 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 Risks 8. The risks considered throughout the audit were: • SRR05: Partnership working risk that inadequate relationships with key partners lead to service delivery failure. • Audit Risk 1: Partnership roles and responsibilities are unclear or poorly communicated. • Audit Risk 2: Decision-making arrangements do not support effective joint working. • Audit Risk 3: There is limited evidence of shared goals or integrated planning processes. • Audit Risk 4: Disputes or misalignment between partners are not effectively managed. Audit Opinion 9. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 10. Our overall audit opinion for this audit is that we can take a high level of assurance. This means that Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Recommendations 11. We have highlighted 3 low priority recommendations where we believe there is scope to strengthen the control and governance environment. These are summarised below: • HSCP should continue to develop existing workforce performance monitoring arrangements so that KPIs and RAG assessments remain clearly linked to strategic objectives and risks that IJB developed in partnership with both employing bodies. • To strengthen assurance, the HSCP should consider embedding awareness of escalation and dispute resolution routes from the Integration Scheme into induction for senior managers and key officers to ensure consistent understanding across the partnership and with wider partners. • HSCP should capture and review recurring themes or patterns from informal partnership challenges to support organisational learning and provide assurance to the IJB that risks are being managed proactively. 12. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 13. Exhibit 2 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective. Page 256
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5 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 Exhibit 2 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion CO1 There is a clear framework governing partnership roles and responsibilities. SRR05 / Audit Risk 1 High Argyll and Bute HSCP operate within a clear and effective governance framework established by the Integration Scheme, which defines statutory responsibilities, decision- making structures, and operational processes between Argyll and Bute Council and NHS Highland. The Integration Joint Board (IJB) provides central oversight, supported by subcommittees and management teams that ensure joint accountability, financial governance, and strategic planning. Evidence from recent IJB minutes, Chief Officer reports, and the Direction Log confirms active participation, structured collaboration, and compliance with legislative expectations across both partners. CO2 Governance and decision-making structures facilitate joint working and accountability. Audit Risk 2 High Argyll and Bute HSCP operate under a well-defined governance framework, with the Integration Joint Board (IJB) and its supporting committees actively overseeing strategic, financial, and clinical functions. Governance documents — including the Integration Scheme, Standing Orders, and Terms of Reference — clearly define roles and responsibilities between NHS Highland and Argyll and Bute Council, ensuring accountability and minimising duplication. IJB meeting records and the Direction Log demonstrate transparent, documented, and jointly actioned decision-making. The approval process for the Joint Strategic Plan further confirms collaborative planning and shared accountability. CO3 The HSCP and Argyll and Bute Council work to shared goals with integrated planning. Audit Risk 3 Substantial Argyll and Bute HSCP and Council demonstrate strong alignment through shared strategic goals embedded in key planning documents such as the Joint Strategic Plan, Commissioning Strategy, and Digital Modernisation Strategy. Joint planning is facilitated by statutory Page 257
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6 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 structures like the Strategic Planning Group and Locality Planning Groups, with clear partner and stakeholder involvement. Performance against shared objectives is actively monitored using structured reporting and risk management frameworks. To enhance transparency and support decision-making, the partnership should consider developing existing workforce performance monitoring arrangements so that KPIs and RAG assessments remain clearly linked to strategic objectives and risks. This should be done in collaboration with both employing bodies. CO4 Disagreements between partners are managed constructively through defined processes. Audit Risk 4 Substantial Argyll and Bute HSCP have robust governance arrangements for dispute resolution, with clearly defined escalation procedures set out in the Integration Scheme and Standing Orders. While no formal disputes were recorded during the audit period, evidence suggests that challenges are addressed collaboratively at operational levels. However, the absence of documented informal disagreements or outcomes limits transparency and learning. To strengthen assurance, the HSCP should consider embedding awareness of escalation and dispute resolution routes from the Integration Scheme into induction for senior managers and key officers to ensure consistent understanding across the partnership and with wider partners. In addition, the HSCP should consider capturing recurring themes or patterns from partnership challenges (rather than logging every issue) to support organisational learning and provide assurance to the IJB that risks are being managed proactively. 14. Further details of our conclusions against each control objective can be found in Section 3 of this report. Page 258
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7 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 3. Detailed Findings There is a clear framework governing partnership roles and responsibilities 15. The Argyll and Bute Integration Scheme provides the statutory foundation for partnership working between Argyll and Bute Council and NHS Highland through the Integration Joint Board (IJB), as required under the Public Bodies (Joint Working) (Scotland) Act 2014. The audit reviewed the current Integration Scheme alongside key supporting documents, including the Chief Officer’s Report (May 2025) and the IJB Direction Log. The Integration Scheme remains up to date following its scheduled 5-year review in June 2025 and continues to define governance structures, financial responsibilities, clinical and care governance, and dispute resolution mechanisms. Evidence from the Direction Log and Chief Officer’s reporting confirms that the scheme is not only active but embedded in operational practice. These documents illustrate effective delegation, accountability, and cross-organisational planning, supporting the conclusion that the partnership framework is robust and functioning in accordance with legislative expectations. 16. Partnership working across Argyll and Bute HSCP is underpinned by a well-defined governance and operational framework. The Integration Joint Board (IJB) remains the central oversight body, bringing together voting members and representatives from both Argyll and Bute Council and NHS Highland. Operational delivery is coordinated through the Strategic Leadership Team (SLT) or Joint Management Team (JMT), which ensures the alignment of Council and NHS functions under the leadership of the Chief Officer. Subcommittees such as the Clinical and Care Governance Group, Finance and Policy Committee, and Audit and Risk Committee provide structured assurance across key areas. Supporting evidence from the Chief Officer’s Report (May 2025), Direction Log, and Annual Audit Report 2023–24 confirms that roles, responsibilities, and communication channels are clearly established and routinely utilised. Wider partnership engagement is also facilitated through forums involving the third sector, independent providers, and locality planning groups, reflecting a broad-based, integrated approach to service planning and delivery. 17. Argyll and Bute Council plays a central role within the Health and Social Care Partnership (HSCP) governance framework. As a statutory partner under the Public Bodies (Joint Working) (Scotland) Act 2014, the Council jointly developed and approved the Integration Scheme alongside NHS Highland, which underpins the partnership’s governance and delivery model. Council representation on the Integration Joint Board (IJB), through appointed elected members, ensures that local authority priorities are directly reflected in strategic decisions. In addition, senior Council officers actively participate in IJB subcommittees such as the Audit and Risk Committee and Finance and Policy Committee, providing input into financial oversight, performance management, and risk assurance. Joint accountability is reinforced through the dual reporting line of the Chief Officer to both parent bodies. Operational coordination is further evidenced through the IJB’s Directions Log, which confirms that services are jointly instructed and delivered across Council and NHS functions. This reflects a partnership model with shared governance and delivery arrangements. 18. A review of minutes of the Integration Joint Board (IJB) meetings such as on 29 January and 26 March 2025 confirm that Argyll and Bute Council and NHS Highland are actively fulfilling their joint responsibilities for the governance of the Health and Social Care Partnership (HSCP). The IJB serves as the primary forum for strategic oversight and decision-making, with documented discussions on key areas such as renewal of the Joint Strategic Plan, financial reporting, and Page 259
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8 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 performance monitoring. The review of minutes also confirmed active participation from both partner organisations, with voting members in attendance and evidence of collaborative input into service planning and accountability processes. The consistent presence of updates from the Chief Officer and financial oversight items further demonstrates that the Integration Scheme is being conducted effectively through structured and transparent governance meetings. Governance and decision-making structures facilitate joint working and accountability 21. Review of the Integration Scheme, IJB Standing Orders, Chief Officer’s Report (May 2025), and IJB meeting minutes confirms that the governance structures described in the Integration Scheme are fully established and operational. The Integration Joint Board (IJB) is functioning as the central governance body, with documented evidence of regular meetings and strategic oversight activity. Supporting committees — including the Audit and Risk Committee, Finance and Policy Committee, and Clinical and Care Governance Group — are actively engaged in providing assurance over financial, clinical, and operational matters. Direction-setting processes and the role of the Strategic Leadership Team (SLT) further demonstrate that governance is not only structured but also embedded in day-to-day delivery. The presence and activity of these structures, with participation from both Argyll and Bute Council and NHS Highland, confirms that the HSCP governance model is aligned with statutory requirements and is being implemented in practice. 22. Review of IJB meeting agendas and minutes from January and March 2025, alongside the Direction Log and Chief Officer’s Report (May 2025), confirms that decision-making processes within the Argyll and Bute Integration Joint Board are transparent, well-documented, and actioned in line with good governance standards. Meeting papers are publicly available in advance, with agendas covering strategic, financial, and operational matters. Minutes clearly record decisions, approvals, and issued directions, demonstrating accountability and follow- through. The Direction Log provides further assurance that agreed decisions are implemented across both NHS Highland and Argyll and Bute Council. 23. The approval process for the Joint Strategic Plan 2022–2025 demonstrates effective joint decision-making and accountability between Argyll and Bute Council and NHS Highland. Review of the Integration Joint Board (IJB) meeting minutes from 25 May 2022 confirms that the plan was formally adopted by the IJB, with voting members from both statutory partners present and engaged in the decision. The development of the plan itself was a collaborative process involving input from both partners, wider stakeholders, and the local community. The inclusive approach, as reflected in the plan’s introduction and supporting documentation, provides strong evidence that both partners’ priorities were considered. This confirms that key strategic decisions within the HSCP are made jointly, in line with the governance principles set out in the Integration Scheme. 24. A review of the Integration Joint Board (IJB) Standing Orders (January 2025), the Integration Scheme, and the Terms of Reference for relevant governance structures confirms that roles and responsibilities between Argyll and Bute Council and NHS Highland are clearly defined and consistently applied. The Standing Orders outline procedural rules for IJB operations, including voting rights and delegated authority, distinguishing the responsibilities of Council and NHS representatives. The Integration Scheme remains the statutory foundation of the partnership, setting out governance arrangements, accountability for strategic planning, and delivery Page 260
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9 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 responsibilities. Subcommittee Terms of Reference (e.g., for Audit and Risk and Clinical and Care Governance) reinforce these roles by identifying specific oversight functions assigned to each partner. Collectively, these documents ensure that duties such as budget management, clinical governance, and operational delivery are allocated without duplication, promoting a structured and accountable governance model within the Health and Social Care Partnership (HSCP). The HSCP and Argyll and Bute Council work to shared goals with integrated planning. 25. A review of key strategic documents—including the Joint Strategic Plan 2022–2025, the Joint Strategic Commissioning Strategy, and the Digital Modernisation Strategy 2022–2025—confirms that shared objectives are clearly embedded within the Health and Social Care Partnership’s (HSCP) planning framework. These documents articulate joint priorities aligned to national outcomes and demonstrate collaborative input from Argyll and Bute Council, NHS Highland, and wider stakeholders. The Joint Strategic Plan outlines strategic goals supported by annual progress reporting and oversight from the Strategic Planning Group. The Commissioning Strategy reflects joint delivery intentions and locality-based planning, while the Digital Modernisation Strategy outlines shared commitments to transformation. Further evidence from the Chief Officer’s Report and the 2025 Integration Scheme Review highlights continued alignment and consultation between partners in setting and refreshing strategic direction. Collectively, these documents demonstrate a strong foundation of joint planning, monitoring, and accountability. 26. A review of governance documents, strategic plans, and meeting records confirms that formal joint planning processes are well established and functioning effectively within the Argyll and Bute Health and Social Care Partnership (HSCP). The Strategic Planning Group (SPG), established in accordance with statutory requirements, includes wide representation from both statutory partners as well as the third sector, carers, professionals, and the public. Minutes from the SPG meeting held on 13 March 2025, along with the Joint Strategic Plan 2022–2025 and its Year Three Progress Report, evidence structured engagement and review processes involving all service areas. Forward planning is supported by documents such as the March 2025 update on the renewal of the strategic plan, which outlines a clear engagement timetable for the new plan due in September 2025. The role of Locality Planning Groups and the senior leadership engagement described in the Chief Officer’s Report (May 2025) further confirm that joint planning is embedded in both operational and strategic activity. The 2025 Integration Scheme Review complements this by illustrating a functioning partnership-led structure, with clear evidence of shared strategic planning, priority setting, and review across all partners. 27. A review of performance reports and supporting documentation confirms that joint priorities within the Argyll and Bute HSCP are actively monitored and reviewed through established performance management arrangements. The Year Three Progress Report (May 2025), aligned with the Joint Strategic Plan, includes RAG-rated assessments and service-level commentary from across key areas such as mental health, community care, and children's services. This structured reporting process allows the Integration Joint Board (IJB) to track progress, identify challenges, and reprioritise as needed. Supporting evidence from the Strategic Risk Register and Internal Audit Reports further demonstrates the integration of performance and risk monitoring, with alignment to strategic objectives such as workforce and digital transformation. The Chief Officer’s Report (May 2025) provides additional high-level narrative insight, reinforcing the HSCP’s approach to joint performance assurance. Overall, this indicates that joint strategic Page 261
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10 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 priorities are not only documented but are subject to consistent and multi-layered review across the partnership. 28. To further strengthen performance assurance and stakeholder communication, the HSCP should consider developing existing workforce performance monitoring arrangements so that KPIs and RAG assessments remain clearly linked to strategic objectives and risks. This should be carried out in collaboration with both employing bodies. Action Plan 1 Disagreements between partners are managed constructively through defined processes. 29. The Argyll and Bute Health and Social Care Partnership (HSCP) operates within a structured governance framework that includes decision-making and escalation procedures, as set out in the Integration Joint Board (IJB) Standing Orders and the Integration Scheme. These documents establish transparent processes for meetings, voting, and formal dispute resolution, including a clear three-stage escalation route involving senior officers, Chief Executives, and potential referral to the Scottish Government. The absence of recent escalations suggests that informal and operational mechanisms are functioning effectively. Supporting structures such as the Audit & Risk Committee and Strategic Planning Group also provide forums for addressing emerging concerns at an early stage. Furthermore, the 2025 Integration Scheme Review process itself reflects practical use of collaborative decision-making and escalation pathways across both partner organisations. Although formal escalation has not been necessary during the audit period, the Chief Officer should consider embedding this in induction for senior managers and key officers on the escalation routes set out in the Integration Scheme, to ensure a consistent understanding across the partnership and with wider partners. Action Plan 2 30. A review of relevant records, including IJB minutes (29 January 2025), the Chief Officer’s Report (May 2025), and supporting internal audit documentation, found no evidence of formal or informal disputes between Argyll and Bute Council and NHS Highland during the audit period. Operational challenges, such as workforce capacity and financial constraints, are documented and discussed openly, but appear to have been managed collaboratively without escalation. While this may reflect effective communication and resolution at officer or committee level, the lack of recorded disagreements limits transparency and makes it difficult to assess how issues are consistently handled or whether patterns of concern exist. Without a mechanism to track informal disputes or significant challenges, assurance over the practical operation of dispute resolution procedures remains limited. Recognising that operational issues are routinely resolved, the HSCP should consider capturing recurring themes or patterns from partnership challenges (rather than logging every issue) to support organisational learning and provide assurance to the IJB that risks are being managed proactively. This would complement existing public reporting, not replace it. Action Plan 3 31. The Strategic Risk Register Review (January 2025) provides clear evidence that partnership- related risks are actively identified, assessed, and monitored by the Argyll and Bute HSCP. A total Page 262
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11 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 of 21 strategic risks are recorded, including six categorised as ‘Very High’, such as financial sustainability, workforce recruitment and retention, and dependencies on both NHS Highland and Argyll and Bute Council for support services and infrastructure. Risks are explicitly mapped to the HSCP’s Strategic Objectives (Appendix 2), ensuring alignment between risk and planning. The register is reviewed biannually by both the Integration Joint Board (IJB) and the Audit & Risk Committee, supporting dynamic and informed oversight. Partnership interdependencies—such as reliance on NHS cyber security and Council HR services—are transparently documented, with corresponding mitigations identified. This demonstrates an integrated approach to risk governance across organisational boundaries. Page 263
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Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date Low 1 Performance Monitoring and Reporting The HSCP should continue to develop the existing workforce performance monitoring arrangements so that KPIs and RAG assessments remain clearly linked to strategic objectives and risks, and reporting continues to provide meaningful assurance to the IJB developed in partnership with both employing bodies. If workforce KPIs and RAG ratings are not clearly aligned with strategic objectives and risks, there is a danger that reporting to the IJB will not provide meaningful assurance. HSCP will further develop its performance dashboard or scorecard that visually aligns key performance indicators (KPIs) and RAG statuses with the HSCP’s strategic objectives and risks. Business Improvement Manager 30th April 2026 Low 2 Dispute Resolution Awareness The Chief Officer should embed this in induction for senior managers and key officers on the escalation routes set out in the Integration Scheme, to ensure a consistent understanding across the partnership and with wider partners Without embedding awareness of escalation routes set out in the Integration Scheme into senior management induction, there is a risk that disputes may not be handled consistently or effectively. The Chief Officer will ensure that induction materials for senior managers and key officers to include a dedicated section on dispute resolution processes and escalation routes as set out in the Integration Scheme. Business Improvement Manager 30th April 2026 Page 264
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13 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 No Finding Risk Agreed Action Responsibility / Due Date Low 3 Informal Issue Themes & Learning Recognising that operational issues are routinely resolved, the HSCP should consider capturing recurring themes or patterns from partnership challenges (rather than logging every issue) to support organisational learning and provide assurance to the IJB that risks are being managed proactively. This would complement existing public reporting, not replace it. If recurring operational issues and partnership challenges are not captured at a thematic level, there is a risk that patterns of concern may go unnoticed. HSCP will establish a confidential action log to capture informal disputes or significant partnership challenges, including those resolved without formal escalation. Business Improvement Manager (vacant) / Head of Strategic Planning, Performance and technology 30th April 2026 Page 265
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14 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the HSCP to achieve better value for money (VFM). Page 266
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15 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – HSCP: Partnership Working, August 2025-26 Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 267
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1 Argyll & Bute Health & Social Care Partnership Internal Audit Report November 2025 Final High Medium Low VFM Number of Findings 0 7 0 0 HSCP: Workforce Planning Audit Opinion: Reasonable Page 269
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2 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 3 Key Dates ................................................................................................................................................ 3 Risks ........................................................................................................................................................ 4 Audit Opinion ......................................................................................................................................... 4 Recommendations ................................................................................................................................. 4 2. Objectives and Summary Assessment ........................................................................................... 5 3. Detailed Findings ............................................................................................................................ 7 Appendix 1 – Action Plan ..................................................................................................................... 11 Appendix 2 – Audit Opinion ................................................................................................................. 16 Contact Details Internal Auditor: David Sullivan Telephone: 01546 604125 e-mail: David.sullivan@argyll-bute.gov.uk www.argyll-bute.gov.uk Page 270
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3 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Risk Committee in February 2025, we have undertaken an audit of Argyll & Bute Health & Social Care Partnership (HSCP) system of internal control and governance in relation to Workforce Planning. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with Health & Social Care Partnership officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the HSCP. 3. The contents of this report have been agreed with the appropriate Health & Social Care Partnership officers to confirm factual accuracy, and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. Workforce planning aligns changing organisational needs with people strategy by analysing demand and supply for skills, identifying gaps, and translating these into actions that sustain the workforce required to deliver HSCP priorities. In line with Scottish Government guidance DL (2022)09, plans should be structured around the national approach (e.g. the five pillars) and aligned to the Joint Strategic Plan. 5. This audit was carried out amid ongoing recruitment and retention pressures, rural capacity challenges, and workforce risks on the Strategic Risk Register. We reviewed the Strategic Workforce Plan and the related management reports. We also assessed arrangements mainly against DL (2022)09 (Scottish Government guidance), using the National Audit Office (NAO) Government workforce planning framework (Sept 2025) as an external reference. 6. The scope of workforce planning for the IJB appropriately encompasses staff employed by both Argyll & Bute Council and NHS Highland, as both groups deliver services within the HSCP and are integral to meeting strategic objectives. Workforce risks and performance data are reported jointly to the IJB. Scope 7. The scope of the audit was to provide assurance over the arrangements for workforce planning as outlined in the Terms of Reference agreed with the Chief Officer of the HSCP on 8th September 2025. Key Dates 8. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted below. Page 271
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4 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 8th September 2025 Fieldwork Commencement 8th September 2025 Draft Report issued 5TH November 2025 Management Comments received 19TH November 2025 Final Report issued 2nd December 2025 Audit and Scrutiny Committee 8th December 2025 Risks 9. The risks considered throughout the audit were: • SRR11 – Workforce Recruitment & Retention (Very High Risk): Inability to retain and recruit required workforce because of Local and National Workforce shortages • SRR16 – Support Services (very High Risk): Risk that support services do not adequately support front line service delivery • Audit Risk 1: Governance and oversight arrangements are not in place • Audit Risk 2: HSCP does not provide workforce data and performance indicators on a regular basis • Audit Risk 3: partnership roles and responsibilities for workforce planning are not clearly defined • Audit Risk 4: Insufficient HR support capacity undermines the delivery and oversight of workforce planning. Audit Opinion 10. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion are provided in Appendix 2 to this report. 11. Our overall audit opinion for this audit is that we can take a Reasonable level of assurance. This means that Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Recommendations 12. We have highlighted seven medium priority recommendations where we believe there is scope to strengthen the control and governance environment. These are summarised below: • Prepare an annual Workforce Plan progress and refresh paper, aligned to Scottish Government guidance DL (2024)33, and present it to the IJB each autumn. • Provide a concise “workforce at a glance” KPI summary through the most appropriate reporting route, with management determining where this is best placed, ensuring alignment with existing workforce reporting. Page 272
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5 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL • Develop and maintain a single consolidated Workforce Plan action tracker, with named owners, baselines/targets, milestones, RAG status and funding source. Management will agree the appropriate reporting frequency to the IJB. • HSCP should ensure that the Scottish Government Appendix 1 ‘Indicative Content Checklist’ (DL 2022/09) is completed and retained for the Workforce Plan. • Develop a costed funding map jointly across NHS Highland and Argyll & Bute Council Finance/HR, setting out estimated costs, named funding sources/budget codes, phasing, and expected benefits/savings for each priority action. • Develop an agency and supplementary staffing report that can be consolidated into a single Finance–HR dashboard showing service-level spend, FTE, 12-month trends, key drivers and named owners, with the dashboard cross-referenced within the Workforce Report to strengthen IJB oversight. • Undertake a joint review of HR support capacity and recruitment timeliness, led by NHS Highland HR and Argyll & Bute Council HR in partnership with the HSCP, to clarify service-level expectations, constraints, and improvement actions. 13. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 14. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective. Exhibit 2 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion C01 The HSCP has a clear and up-to- date Workforce Plan aligned to national and local strategic priorities. SRR11 SRR16 Reasonable We reviewed the Strategic Workforce Plan 2022–2025 and related IJB reporting. The jointly developed plan (Argyll & Bute Council / NHS Highland) was produced as per Scottish Government guidance DL (2022)09. It follows the National Workforce Strategy’s five pillars and aligns with the Joint Strategic Plan, financial planning, the Digital Modernisation Strategy, and the JSNA (including remote/island challenges). It was approved by the IJB in Nov 2022 and supported by routine quarterly workforce reports. However, as of October 2025 no standalone 2024 refresh/consolidated progress report was identified despite the Plan’s annual review commitment: future versions Page 273
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6 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL should align to the latest Scottish Government guidance namely DL (2024)33. CO2 Governance and oversight arrangements are in place to monitor implementation and progress of workforce planning objectives Audit risk 1 Reasonable Governance for workforce planning is clearly set out (Integration Scheme and committee Terms of Reference), workforce risks are routinely reviewed by the Audit and Risk committee and Integrated Joint Board (A&RC/IJB), and multi-agency input is evident; however, the Chief Officer’s report lacks a simple KPI’s “at-a- glance” and progress mapping to Plan actions, and action tracking is inconsistent (no single consolidated tracker. We also found no retained SG DL (2022)09 Appendix-1 checklist, and costing/funding is not shown at action level. CO3 Workforce data and performance indicators are systematically monitored and used to inform planning. Audit Risk 2 Reasonable Quarterly reports evidence progresses but remain high-level and aren’t consistently tied to plan actions, owners or milestones; several KPIs lack targets/benchmarks and there’s no single RAG-tracked action tracker visible to the IJB. While targeted investment is evident, there’s no consolidated, action-level costing/funding map, and agency spend/FTE is absent from the Q4 pack despite ongoing reliance on supplementary staffing. CO4 Partnership roles and responsibilities for workforce planning are clearly defined and coordinated across NHS Highland and Argyll & Bute Council Audit Risk 3 High Partnership roles and responsibilities for workforce planning are clearly defined and embedded through the IJB, Strategic Planning Group, Clinical & Care Governance Committee, and Audit & Risk Committee. CO5 HR support capacity and arrangements are sufficient and effective to enable workforce planning, with clear mitigations and escalation where gaps exist Audit Risk 4 Reasonable Recruitment timeliness pressures are evident, but current reporting does not define HR support capacity, Service Level Agreements (SLAs) interim cover or a joint escalation route—so links between HR capacity and recruitment are not obvious. Page 274
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7 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL 15. Further details of our conclusions against each control objective can be found in Section 3 of this report. 3. Detailed Findings The HSCP has a clear and up-to-date Workforce Plan aligned to national and local strategic priorities. 16. The Argyll & Bute HSCP Strategic Workforce Plan 2022–2025 was produced under Scottish Government guidance DL (2022)09 and explicitly references the National Workforce Strategy for Health and Social Care (2022). It is structured around the Strategy’s five pillars—Plan, Attract, Train, Employ, Nurture—and aligns workforce priorities with the Joint Strategic Plan and financial planning. The Plan was developed jointly by NHS Highland and Argyll & Bute Council and approved by the IJB in November 2022. 17. The Plan states it will be reviewed annually in line with strategic planning cycles, however, a standalone 2024 refresh/consolidated progress report was not identified at the time of audit. Future versions should align to the updated guidance DL (2024)33 issued December 2024 by the Scottish Government. Action Plan 1 18. The Plan explicitly references and aligns with the National Workforce Strategy for Health and Social Care (2022) as recommended in DL (2022)09. It translates national priorities—workforce growth, wellbeing, and stronger workforce-planning capacity—into local objectives and actions for Argyll & Bute. A subsequent workforce planning update summarises progress against those actions and shows how they contribute to the HSCP’s strategic priorities. 19. The Plan is clearly integrated with local strategic planning and national guidance. As recommended under Scottish Government guidance DL (2022)09, it aligns workforce priorities to the Joint Strategic Plan 2022–2025 and service-transformation objectives and cross- references the Digital Modernisation Strategy with commitments on digital skills, remote/hybrid service delivery, and technology-enabled care. Locality needs are informed by the Joint Strategic Needs Assessment, recognising remote and island challenges and related workforce implications, which are translated into targeted actions. Taken together, this shows workforce planning is embedded within the HSCP’s overarching strategy Governance and oversight arrangements are in place to monitor implementation and progress of workforce planning objectives 20. Review of governance documentation—Integration Scheme and Terms of Reference for IJB Committees (Jan 2025, pp. 6–18)—confirms that workforce planning responsibilities are embedded within the partnership. The Strategic Planning Group incorporates workforce considerations into the Strategic Plan; the Clinical & Care Governance Committee oversees workforce factors affecting quality and safety (staffing levels, capacity, skill mix); and the Audit & Risk Committee monitors workforce-related risks on the Strategic Risk Register, escalating to the IJB as required. The Integration Scheme assigns the IJB, through the Chief Officer and HR/OD workstreams, responsibility to produce and maintain a Workforce and Organisational Development Plan covering delegated functions. These arrangements indicate clear responsibilities, defined reporting routes, and regular oversight. Page 275
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8 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL 21. Review of IJB minutes and papers confirms that workforce planning is reported routinely— typically via quarterly workforce performance reports and within wider performance/planning updates. A formal update was provided in May 2023; however, as of September 2025 we found no standalone 2024 annual refresh/consolidated progress report on delivery of the Strategic Workforce Plan, as envisaged by DL (2022)09. Future refreshes should be prepared in line with the updated Scottish Government guidance DL (2024)33. Action Plan 1 22. Review of the Strategic Risk Register (January 2025) confirms that workforce-related risks—such as recruitment and retention, specialist skill shortages, and challenges in attracting staff to remote and rural areas—are recorded, graded (with several at Very High residual level), and mapped to the HSCP’s Strategic Objectives. Each risk sets out current mitigations (e.g. targeted recruitment, partnerships with education providers, flexible working), and the register is reviewed on a biannual cycle by both the Audit & Risk Committee and the Integration Joint Board with updates provided through formal reporting. Mitigations and residual risk levels are tracked over time, indicating a structured process for monitoring and oversight. 23. Review of the Terms of Reference for the IJB committees confirms multi-agency representation (Argyll & Bute Council, NHS Highland and third sector) through the Integration Joint Board, Strategic Planning Group and Clinical & Care Governance Committee, supporting cross-partner oversight of workforce matters. IJB minutes and Chief Officer reports show workforce topics discussed with partner input. Staff engagement is evident during development of the 2022– 2025 Workforce Plan (e.g., joint staff-side representation and consultation). 24. The Chief Officer’s Report to the IJB (28 May 2025) references several workforce-relevant items—leadership changes and recruitment to stabilise the senior team, interim coverage for Primary Care while a permanent Head is recruited, and training initiatives (e.g., UHI’s care-home training to address remote and rural access). It also notes wider context (financial pressures, demographics) and stakeholder briefings. The Chief Officer reporting provides the IJB with valuable narrative updates on workforce-related pressures and initiatives. However, it does not present headline workforce KPIs (e.g., vacancy, time-to-hire, sickness, agency) or progress against the Strategic Workforce Plan. Including a brief “workforce at a glance” KPI paragraph (with a signpost to the full Workforce Report) would give members concise, high-level assurance. Action Plan 2 25. The Strategic Workforce Plan 2022–2025, developed under Scottish Government guidance DL (2022)09, sets clear workforce priorities (recruitment and retention, succession planning, wellbeing, training/development, accommodation/digital) and identifies material risks (ageing profile, remote/rural recruitment, specialist shortages, sickness). It includes a themed Strategic Workforce Action Plan with SMART-style elements (e.g., % increase in under-25 profile, Investors in Young People accreditation by July 2023, succession-planning toolkit with review dates, actions to reduce placement losses via accommodation). However, coverage is uneven, and some actions lack explicit KPIs/baselines, named owners, timelines and funding sources. Future versions should align to the latest Scottish Government guidance i.e. DL (2024)33 and ensure every risk-linked action has measurable indicators with targets, milestones/due dates, a named owner and funding source, all maintained in a single consolidated tracker reported to the IJB. Action plan 3 Page 276
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9 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL 26. The Scottish Government guidance DL (2022)09 includes an Appendix 1 “Three-Year Workforce Plan – Indicative Content Checklist” intended to assure completeness and alignment (methodology used; partner engagement; quantified gap analysis; linkage to service and financial plans; and actions structured under the five pillars). We found no evidence that this checklist was completed or retained when the Plan was produced. Action Plan 4 Workforce data and performance indicators are systematically monitored and used to inform planning 27. Review of the Strategic Workforce Plan 2022–2025 and management reporting (including the Q4 2024/25 Workforce Report, the September 2025 Workforce Report, and IJB/SLT papers) shows progress on several priorities—for example targeted recruitment to hard-to-fill posts, expansion of flexible working, and delivery of digital skills training. The September pack adds targets/benchmarks for some KPIs (e.g., time-to-fill and sickness) and notes recruitment stage metrics are being finalised; however, reporting remains largely high-level and is not consistently linked to the Plan’s actions, named owners, milestones or KPIs, and coverage of targets/benchmarks is still inconsistent. There is still no single consolidated tracker with action- level RAG/status visible to the IJB, and agency usage (spend and FTE) is not provided in the workforce pack despite reliance on supplementary staffing being flagged elsewhere. Consequently, members lack a clear line of sight from performance data to delivery of the Strategic Workforce Plan and associated risk mitigation. Action Plan 3 28. Review of the Workforce Plan and management reporting evidences investment in several workforce priorities—such as recruitment/retention activity, leadership development, and staff training (e.g. the UHI care-home training supported via the Care Home Collaborative Group)— with activity funded primarily from partner core budgets and, where applicable, national programmes (e.g. Primary Care Improvement Plan, Vaccination Transformation Programme, Recovery & Renewal). However, neither the Plan nor the quarterly workforce reports provide a consolidated, action-level breakdown of costs or named funding sources for many priorities; costs are recorded “as appropriate”, limiting assurance that all initiatives are fully and sustainably resourced. Action Plan 5 29. Review of documents confirms an ongoing reliance on supplementary staffing (bank/agency) driven by vacancies and sickness; the Workforce Plan explicitly notes this under “Supplementary Staffing”. While the FQ4 2023/24 Performance Report records a 21% (£50k per month) reduction in agency nursing costs in Argyll & Bute hospitals, the 2024/25 workforce reporting set does not provide a consolidated, service-level view of agency spend and FTE with 12-month trends, targets and named owners. These limits targeted action, benefits tracking and committee oversight. Action Plan 6 Page 277
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10 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL Partnership roles and responsibilities for workforce planning are clearly defined and coordinated across NHS Highland and Argyll & Bute Council 30. Partnership roles and responsibilities are evident within the Integration Scheme (Section 7), committee Terms of Reference (IJB, Strategic Planning Group, Clinical & Care Governance, Audit & Risk Committee), and the governance sections of the Strategic Workforce Plan 2022–2025. They indicate that roles are clearly defined at the governance level: the IJB sets direction and receives assurance; the Strategic Planning Group embeds workforce within the Strategic Plan; the Clinical & Care Governance Committee oversees workforce factors affecting quality and safety (staffing levels, capacity, skill mix); and the Audit & Risk Committee monitors workforce risks via the Strategic Risk Register and escalates as required. The Workforce Plan describes oversight arrangements and workstreams supporting delivery. HR support capacity and arrangements are sufficient and effective to enable workforce planning, with clear mitigations and escalation where gaps exist 31. Review of the Strategic Workforce Plan 2022–2025, the Q4 2024/25 Workforce Report, the Chief Officer’s Report (May 2025) and the January 2025 Strategic Risk Register (SRR) evidence ongoing recruitment timeliness pressures. However, the documents do not define Human Resources (HR) support capacity or service levels (SLAs), set out interim cover arrangements, or show a joint escalation route to the IJB when HR capacity constraints arise. As such, links between HR capacity and recruitment timeliness / employee-relations (ER) support are not transparently evidenced in routine reporting. Action Plan 7 Page 278
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11 Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date Medium 1 Annual Workforce Plan refresh The Plan commits to an annual refresh; however, as at September 2025 no standalone 2024 refresh/consolidated progress paper was identified. Workforce updates appear within routine reports rather than a single progress report. Future refreshes should align to updated SG guidance DL (2024)33 (Dec 2024). If there’s no Annual refresh, the Integrated Joint Board can’t easily see what’s on track, and therefore problems may be missed. A standalone Workforce Plan progress and refresh paper will be prepared annually, summarising delivery against the Strategic Workforce Plan 2022–2025 (and its successor) and aligning to Scottish Government guidance DL (2024) 33. The paper will be presented to the IJB for approval each autumn to maintain visibility and assurance. People Partner: HSCP April 2026 Medium 2 Chief Officers Report The Chief Officer’s Report provides valuable narrative updates but does not include headline workforce KPIs (e.g., vacancy, time-to-hire, sickness, agency) or a summary link to progress against the Strategic Workforce Plan. A brief “workforce at a glance” KPI summary would give IJB members clear, high-level assurance and help identify emerging issues quickly Without a concise KPI summary, members may miss emerging workforce pressures, reduce visibility of progress and slowing decision-making. Management will agree the most appropriate reporting mechanism for providing a concise “workforce at a glance” KPI summary, ensuring alignment with existing workforce reporting arrangements and avoiding duplication. People Partner: HSCP April 2026 Page 279
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12 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL No Finding Risk Agreed Action Responsibility / Due Date Medium 3 Workforce Plan action tracker (quarterly to IJB) The 2022–2025 Plan includes SMART-style actions, but coverage is inconsistent, and some actions lack explicit KPIs/baselines, named owners, timelines and funding sources. Future refreshes should align to DL (2024)33 and maintain a single consolidated action tracker visible to the IJB. Without clear measures, ownership, dates and funding, actions may drift, benefits may not be delivered, and the IJB cannot easily monitor progress or hold services to account. A single consolidated Workforce Plan action tracker will be developed to capture all agreed workforce actions across the HSCP. Each action will include a named owner, baseline/target, milestones, RAG status, and identified funding source, in line with Scottish Government guidance DL (2024)33. Management will determine the appropriate reporting frequency to ensure the tracker provides suitable visibility and assurance to the IJB Head of Strategic Planning, Peformance and Technology: HSCP People Partner: HSCP April 2026 Medium 4 Appendix 1 checklist Scottish Government guidance DL (2022)09 includes an Appendix 1 “Three-Year Workforce Plan – Indicative Content Checklist” to assure completeness (methodology, partner engagement, gap analysis, linkage to service/finance plans, and actions under the five pillars). No evidence was found that this checklist was completed or retained when the Plan was produced/refreshed. At the next Workforce Plan refresh, complete the Appendix 1 checklist in full. Without the checklist, important requirements can be missed, the Integrated Joint Board has less assurance that the Plan is complete, and therefore it may fall short of Scottish Government expectations. The Appendix 1 “Three- Year Workforce Plan – Indicative Content Checklist” from Scottish Government guidance DL (2022) 09 will be fully completed and retained as part of the documentation for the next Workforce Plan refresh. Head of Strategic Planning, Performance and Technology: HSCP People Partner: HSCP April 2026 Page 280
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13 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL No Finding Risk Agreed Action Responsibility / Due Date Medium 5 Funding for Workforce Plan actions The Strategic Workforce Plan and quarterly workforce reports show targeted investment (e.g., recruitment and retention initiatives, leadership programmes, UHI care-home training). However, they do not provide a consolidated, action-level breakdown of estimated costs or named funding sources. Costs are referenced only “as appropriate,” limiting assurance that priority actions are fully resourced and sustainable. Without clear costs and funding sources, priority actions may be under- resourced or delayed and overspends may occur. It also becomes harder for the IJB to assess value for money and ensure the Workforce Plan is deliverable. A costed funding map will be developed jointly by NHS Highland Finance/HR and Argyll & Bute Council Finance/HR, working in partnership with the HSCP. The map will set out, for each priority action, the estimated cost, named funding source or budget code, phasing, and expected benefits or savings. NHS Highland Finance and HR / Argyll and Bute Council Finance and HR June 2026 Medium 6 Agency Costs Reliance on supplementary staffing (bank and agency) is acknowledged in the Workforce Plan and risk documentation. However, the 2024/25 reporting does not provide a consolidated, service-level view of agency spend and FTE with 12-month trends, targets, or named owners. These limits targeted action, benefits tracking, and IJB oversight. Without clear, consolidated reporting of agency usage, costs may rise without prompt intervention, and it becomes harder to demonstrate savings or understand the drivers of supplementary staffing. Existing agency and supplementary staffing reporting will be consolidated and expanded into a single dashboard, developed jointly with Finance and HR. The dashboard will provide service-level spend and FTE, 12-month trends, key drivers (e.g., vacancy, sickness), and named owners. It will be cross- referenced within the regular Workforce Report to the IJB to support clearer oversight. HR Business Partner / Finance Business Partner (Argyll and Bute Council) in partnership with HSCP April 2026 Page 281
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14 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL No Finding Risk Agreed Action Responsibility / Due Date 7 HR and Support Services Recruitment timeliness pressures are evident in the Workforce Plan, the Q4 2024/25 Workforce Report, the Chief Officer’s Report (May 2025), and the January 2025 Strategic Risk Register. However, the documents do not define HR support capacity, service levels (SLAs), interim cover arrangements, or escalation routes. As a result, the link between HR capacity and workforce planning delivery is not clearly evidenced. Without clear expectations regarding HR support capacity and service levels, recruitment and employee-relations (ER) processes may be delayed or inconsistent, agency costs may rise, and the IJB has weaker assurance that workforce plans are adequately supported. NHS Highland HR and Argyll & Bute Council HR will jointly review HR support capacity, recruitment timeliness, and service- level expectations, working in partnership with the HSCP. The review will identify current constraints, the minimum level of support required, and any improvement actions or escalation routes needed to strengthen assurance to the IJB. Deputy Director of People (NHS Highland) and Head of Customer Support Services (Argyll & Bute Council), in partnership with the HSCP June 2026 Page 282
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15 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the HSCP to achieve better value for money (VFM). Page 283
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16 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Workforce Planning, November 2025 Classification: OFFICIAL Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues. Page 284
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