UNLOCKING POTENTIAL UNLOCKING POTENTIAL LIVES TRANSFORMING

ANNUAL REPORT & ACCOUNTS 2017-2018 & ACCOUNTS REPORT ANNUAL SCOTTISH PRISON SERVICE

SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-18 SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

CONTENTS

01-16 PERFORMANCE REPORT – OVERVIEW 02 • Foreword 04 • Purpose and Activities 07 • Key Risks and Issues 08 • Performance Summary 2017-18

17-34 PERFORMANCE REPORT – PERFORMANCE ANALYSIS

35-42 ACCOUNTABILITY REPORT – CORPORATE GOVERNANCE 36 • Directors’ Report 39 • Statement of Accountable Officer’s Responsibilities 40 • Governance Statement 43-54 ACCOUNTABILITY REPORT - REMUNERATION AND STAFF REPORT 44 • Remuneration Report 50 • Staff Report 55-58 ACCOUNTABILITY REPORT - PARLIAMENTARY ACCOUNTABILITY AND AUDIT REPORT 56 • Parliamentary Accountability Report 57 • Independent Auditor’s Report 59-82 FINANCIAL STATEMENTS AND NOTES TO THE ACCOUNTS

83-96 APPENDICES 84 1. Location of Establishments 85 2. Average Daily Population and Maximum Number by Penal Establishment 2017-18 86 3. Average Daily Population by Type of Custody 2017-18 87 4. Absconds and Failures to Return 2017-18 88 5. Breaches of Discipline and Outcome in Penal Establishments by Sex and Age 2017-18 89 6. Staff in Post 92 7. Parliamentary Accountability 93 8. (a) Key Performance Indicators (b) What do the Operational Performance Indicators Mean? 95 9. National Performance Framework with SPS Strategic Themes, Outcomes and Operational Performance Indicators 96 10. Court Custody and Prisoner Escort Service

CONTENTS 01

PERFORMANCE REPORT – OVERVIEW

The purpose of this section is to provide an overview of the Scottish Prison Service, its purpose and activities. This section also includes information on key risks and issues for the organisation as well as a high level summary of performance in 2017-18.

PERFORMANCE REPORT – OVERVIEW SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

FOREWORD

I am pleased to introduce our Annual Report and Accounts for 2017-18.

The year has seen significant progress Prison Officer Professionalisation Three of our Non-Executive Directors being made in a number of key priority Programme (POPP) stood down in the course of the year areas and the report this year includes POPP is a major programme of and I would like to take this opportunity a number of case studies highlighting public sector reform; it is a critical to thank them for all that they have some of these key areas of activity. element in the achievement of our done to support me and the SPS over vision of creating environments the last few years. Young people of transformational change. The Doing all we can for the young people transition of Prison Officers into In turn, I welcome our new Non- in our care remains high on our agenda. justice professionals who will act as Executive Directors to SPS and look 2018 has been designated the year of catalysts for that change process is forward to benefiting from their the young person and SPS has made key to success. We are approaching the experience and advice moving forward. a significant commitment to support finalisation of proposals, which will be The focus on developing our this by ensuring that the young people the subject of a ballot in 2018. in our care are able to participate in a Throughcare support arrangements range of activities and events. We have Tobacco Free Prisons continued in 2017-18 with the recruited 14 youth “ambassadors” from Following the publication of the publication of the independent amongst those in our care and from Tobacco in Prisons Study (TIPS) report evaluation undertaken on our behalf. the staff group to take these activities in 2017, which detailed the impact 2017-18 also saw the development forward. of second hand smoke on our staff, and implementation of a Performance we accelerated the delivery of our Management Framework, which clearly Women’s Strategy commitment to developing smoke sets out our approach to that issue, as Significant progress has been made free prisons. Scotland’s prisons will be well as the completion of the Digital in the course of the year to take smoke free by the end of 2018. forward our strategy for women in Strategy which provides a framework custody. A planning application for Retendering of Escorting Contract for the development of our digital the new National Facility on the site The retendering of the Scottish Court infrastructure. of the existing HMP Cornton Vale was Custody and Prisoner Escorting Finally I would like to extend my thanks submitted to Stirling Council in March Service (SCCPES) was delivered in and appreciation to all of the staff of 2018. the course of the reporting year. the Scottish Prison Service for the New arrangements will commence tremendous job they do. They make a In the course of the year it was also in January 2019 with significant real difference to the lives of those in confirmed that the proposed locations enhancements to quality of service. of the first Community Custody Units our care and as a consequence help to would be in Glasgow and Dundee The management of risk remains a make Scotland a safer and better place. and the progression of planning high priority and the report reflects applications is ongoing. the way in which effective risk management permeates all that we do. The risk register is discussed and Colin McConnell refined regularly by both the Executive Chief Executive Management Team and the Advisory Board. 27 June 2018

PERFORMANCE REPORT – FOREWORD 03

Colin McConnell Chief Executive

IT IS BOTH TRULY IMPRESSIVE AND VERY GRATIFYING TO BE ABLE TO DEMONSTRATE AGAIN THAT THROUGH ITS PEOPLE THE SPS IS KEEPING PACE, PERFORMING WELL AND DELIVERING HIGH VALUE PUBLIC SERVICES.”

PERFORMANCE REPORT – FOREWORD SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

PURPOSE AND ACTIVITIES

The SPS continues to deliver a range of operational services that contribute to the strategic outcomes, objectives and policies of the Scottish Government.

History Our Principal Activities Vision and Mission of SPS The Scottish Prison Service (SPS) is an The SPS is a public service-led agency The SPS has a Vision of helping to build agency of the Scottish Government which is legally required to deliver a Safer Scotland – Unlocking Potential and was first established in April custodial and rehabilitation services – Transforming Lives. The Mission of 1993. The SPS Framework Document for those sent to it by the courts. the SPS is: Providing services to help sets out the policy and resources Appendix Two details the average to transform the lives of the people in framework set by Scottish Ministers number of individuals held in custody our care so they can fulfil their potential within which the SPS operates. As an during 2017-18. and become responsible citizens. Executive Agency, the SPS is funded by the Scottish Government. In line The SPS continues to deliver a In delivering our Vision and Mission, our with the Framework Document, the range of operational services that operating task is: Helping to protect SPS sets out its business objectives in contribute to the strategic outcomes, the public and reduce re-offending the three-year Corporate Plan for the objectives and policies of the Scottish through the delivery of safe and secure period 2017-20 and an Annual Delivery Government. custodial services that empower the Plan which is published in the spring of offender to take responsibility to fulfil Our principal objective is to contribute each year. their potential. to making Scotland Safer and Stronger by addressing offending and We deliver this through: protecting public safety by focusing Custody – Managing safe and secure on recovery and reintegration. The custodial environments. SPS aims to achieve this by ensuring delivery of secure custody; safe and Order – Providing stability and order ordered prisons; decent standards that helps offenders to transform their of care; and opportunities for those lives. citizens in our care to develop in a way Care – Supporting wellbeing and that helps them reintegrate into the treating with respect and humanity all community on release. in our care. At 31 March 2018, there were 13 Opportunity – Providing opportunities publicly managed prisons and two which develop the potential of our privately managed prisons (HMPs staff, our partnerships and the people Addiewell and Kilmarnock). Appendix in our care. One shows the location of the prisons. The SPS also manages, on behalf of multi-agency justice partners, the national contract for the provision of court custody and prisoner escorting and routinely works and co-operates with statutory and other partners to deliver improved Justice Outcomes.

PERFORMANCE REPORT – PURPOSE AND ACTIVITIES 05

Our Commitment and Values Our core values are the foundation Our Strategic Priorities Our Vision and Mission provide a of how we behave and are central To deliver the Vision and Mission, driving ambition and clarity of direction to our organisation relating to our SPS has four Strategic Themes and for our organisation. Our commitment commitment to respecting human Outcomes, each of which is supported remains to: rights. We believe that the keys to by Key Success Indicators (KSIs). delivering our Mission are: > view ourselves as part of the ‘whole For the 2017-2018 Annual Delivery Plan, system’; > Belief – we believe that people can we identified Essential Actions against change. > develop a person-centred, asset- which performance can be reviewed based approach to unlock the > Respect – we have proper regard and reported on. potential of our people and those in for individuals, their needs and their our care; human rights. > encourage and support our staff and > Integrity – we apply high ethical, those in our care to be all they can be; moral and professional standards. > together with partners, strengthen > Openness – we work with others to links into communities and support achieve the best outcomes. re-integration on release; and > Courage – we have the courage to > professionalise and invest in SPS staff care regardless of circumstances. as effective change agents. > Humility – we cannot do this on our own, we recognise we can learn from others.

STRATEGIC THEME

PROFESSIONALISM PARTNERSHIP PURPOSE GOVERNANCE

OUTCOME Unlocking potential Unlocking potential Transforming Lives Delivering Best Value

We will have the Our collaboration Our communities are Our services are right people, with with partners results safer because those efficient, effective the right skills, in in enhanced service citizens in our care and provide value the right place at provision and better are supported to for money. the right time. personal outcomes build on their assets for those citizens in and return to their and leaving our care. communities as productive citizens.

PERFORMANCE REPORT – PURPOSE AND ACTIVITIES SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Our Contribution to National > Our public services are high quality, Stakeholder Engagement Outcomes continually improving, efficient and We have engaged and will continue The SPS contributes to ‘Scotland responsive to local people’s needs. to engage with stakeholders locally, Performs’, the strategic objectives nationally and internationally, and work of Safer and Stronger Communities, These National Outcomes are closely with a wide range of bodies to and the National Outcomes through reflected in the national strategy: help shape our services. delivery of the KPIs and the Essential Vision and Priorities: Justice in Scotland Actions set out in Annual Delivery Plans. (Scottish Government July 2017). We Our partners in 2017-18 include: have a strong lead role to play in the > Community Justice Scotland Essential Actions have been developed delivery of the vision of this strategy under each of the Strategic Outcomes. to contribute positively to a flourishing > Local Community Justice partnership Our outcome-focused approach to Scotland, helping to create an inclusive arrangements performance is complemented by and respectful society in which all > Community Planning Partnerships Operational Performance Indicators people and communities live in safety > Education Scotland (operational results) which are detailed and security; a society where individual in Appendix Eight. These cover a range and collective rights are supported and > Employers disputes are resolved fairly and swiftly. of areas of parliamentary and public > Local Authorities interest. A diagram showing the links to the > NHS National Outcomes and Strategy is The National Performance Framework > Police Scotland and the Agenda for Public Services shown in Appendix Nine. Reform outlined in the ‘Report on the > Scottish Government Value Proposition Future Delivery of Public Services’ > Skills Development Scotland (Scottish Government 2011) underpin In December 2016, the SPS published > Third Sector what we do. Success in achieving our its ‘Value Proposition’. Alongside Vision will contribute directly to the our Corporate Plan, the document > Universities following National Outcomes: outlines our commitment to working with partners and other agencies to > We live our lives safe from crime, deliver better, more positive outcomes disorder and danger. for those in our care and thereby > We have strong, resilient and contribute to a more socially just and supportive communities where safer Scotland. The Value Proposition people take responsibility for their can be accessed on our website at own actions and how they affect www.sps.gov.uk. others.

PERFORMANCE REPORT – PURPOSE AND ACTIVITIES 07

KEY RISKS AND ISSUES

SPS believes that the achievement of INTRODUCTION TO PERFORMANCE It is recognised that some service corporate objectives relies upon the This Annual Report is the first in which development, improvement taking of appropriate risks as long as we report on performance relating to programmes and initiatives will extend they are managed effectively. the SPS Corporate Plan 2017-20 (the across the life of the Plan. As such, the Plan). The Plan is evidence-based, Essential Actions detailed in the ADP Risks are regularly reviewed focuses on service development and represent only those elements of throughout the SPS, in combination improvement and describes a journey activity that are scheduled for delivery with the assessment and of transformational change. It defines in the given year. implementation of appropriate and our contribution to the delivery of targeted controls and mitigations. National Outcomes and the National HOW WE MANAGE PERFORMANCE Strategy: Justice in Scotland: Vision and Outcome-focused quarterly and The risks and challenges which were Priorities through Strategic Themes annual performance reports are considered to be key items which could and Outcomes and Key Success presented to our Executive impact on the successful delivery of Indicators: Management Group (EMG) for scrutiny our corporate objectives are and our Advisory Board (AB) for advice. documented within the case studies > Strategic Themes define the broad An annual report is submitted to our outlined within the performance areas where we will focus on Risk Monitoring and Audit Committee analysis. improving and developing our service. (RMAC) for consideration of any > Strategic Outcomes describe what implications relating to risk we aim to achieve from our management, control and governance. programme of service development and improvement activity. In this section of the Annual Report, we summarise our overall performance in > Key Success Indicators reflect areas relation to the four Strategic Themes considered critical to achieving our and Outcomes of the Plan. outcomes. We also report on a set of Operational For each year of the Plan, we develop Performance Indicators. These cover a an Annual Delivery Plan (ADP). The ADP range of areas of parliamentary and sets out the Essential Actions we will public interest and are detailed in deliver during the course of the year in Appendix Eight. order to deliver our Strategic Outcomes. This Annual Report covers the first ADP in the life of the Plan.

The ADP is underpinned by Directorate Business Improvement Plans and Business Improvement Plans in each establishment and area.

PERFORMANCE REPORT – KEY RISKS AND ISSUES SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

PERFORMANCE SUMMARY 2017-18

Our ADP 2017-18 contained 20 Essential Actions and good progress has been made. Sixteen have been delivered in full or continue on track, one has been re-profiled and three has not been completed, although work will continue into the next financial year. A detailed description of progress is provided in the Performance Analysis section. In the following sections, we provide a high level summary of activity.

STRATEGIC THEME PROFESSIONALISM

STRATEGIC Unlocking potential OUTCOME We will have the right people with the right skills in the right place at the right time.

Our workforce are our most valuable asset and important resource. We set out an ambitious programme of change to develop the capability and capacity of our frontline and correspondingly develop a new operating model across our prisons. Our objective is to equip all staff with the skills and time necessary to deliver services in a person-centred and asset-based way – an approach which aims to encourage and empower those in our care to recognise and make use of their own strengths in support of their desistance journey.

We made good progress in 2017 with the publication of our Workforce Strategy in April 2018 and the delivery of Prison Officer Professionalisation Programme (POPP) related products including: > ‘Skylining’ activity which looks at the operational demands on staff resources during the course of the day. > Design work relating to the Professional Qualification which is a key element of professionalising the workforce and equipping them with the necessary skills and expertise. > Design work relating to the Prison Officer job description to reflect the requirement to work in a person-centred and asset- based way.

PERFORMANCE REPORT – SUMMARY 09

STRATEGIC THEME PARTNERSHIP STRATEGIC Unlocking potential OUTCOME Our collaboration with partners results in enhanced service provision and better personal outcomes for those citizens in and leaving our care.

We recognise that prisons do not exist in isolation and that strong and effective collaborative working with partners is essential to delivering our Strategic Outcomes and achieving the best outcomes for those in and leaving our care. > 2017-18 saw the first year of operation of Community Justice Scotland and associated local partnership arrangements. We supported the establishment of local partnership arrangements by equipping our Governors and senior colleagues to act as ‘place’ representatives within partnership arrangements. > Following the publication of the Tobacco in Prisons Study (TIPS) report in 2017, which detailed the impact of second-hand smoke on our staff, we accelerated the delivery of our commitment to developing smoke free prisons. As a result, local project teams have been established in each prison and the Prison and Young Offenders Institutions (Scotland) Rules 2011 (The Prison Rules) were amended to enable single use e-cigarettes to be introduced across the SPS estate in February 2018. > The health and social care needs of those in our care became increasingly prominent in 2017-18. During the year, the Scottish Government established the Health and Social Care in Prisons Programme Board (HSCPPB) to determine the responsibility for social care in prisons and identify delivery models. SPS will play a full part in the process and arrangements were agreed for SPS representation on the four workstreams of the group which will be progressed in 2018-19. > The focus on developing our Throughcare support arrangements continued in 2017-18 with the publication of the independent evaluation undertaken on our behalf by Reid-Howie Associates which identified strengths and areas for improvement. Recommendations for the future delivery of Throughcare support were considered by our EMG with a view to ensuring equity of access to Throughcare provision across both public and private sector establishments. > Whilst real progress has been made with the development of our approach to partnership working, there is further work to be done in defining our relationship with Prison Based Social Work Services. This is one of our Key Success Indicators. Work was undertaken in 2017-18 towards the development of a Memorandum of Understanding which will replace existing Service Level Agreements pending agreement of the future shape of service provision. This work will continue and be reflected in our Annual Delivery Plan 2018-19.

PERFORMANCE REPORT – SUMMARY SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

STRATEGIC THEME PURPOSE STRATEGIC Transforming Lives OUTCOME Our communities are safer because those citizens in our care are supported to build on their assets and return to their communities as productive citizens.

Our purpose is to create the right environment and supports to enable those in custody to achieve personal change. As such we need to offer a range of choices and supports to promote that change, and our programme of development and improvement activity for 2017-18 focused on three important areas: > The improvement of our arrangements relating to Purposeful Activity was a continuing focus for 2017-18 and we published a Purposeful Activity Framework which introduced a national delivery model and requires individual establishments to prepare Purposeful Activity Plans. > Our commitment to Young People was manifested through continued implementation of our Strategy for Young People and the use of Positive Future Plans for short-term offenders which are designed to support successful re-integration into the community. > Significant progress was made with implementation of the Women’s Strategy through planning for the new Women’s National Facility at Cornton Vale and the identification of sites in Glasgow and Dundee for two Community Custody Units (CCUs).

PERFORMANCE REPORT – SUMMARY 11

STRATEGIC THEME GOVERNANCE

STRATEGIC Delivering Best Value OUTCOME Our services are efficient, effective and provide value for money.

We are committed to improving the efficiency and effectiveness of our service and, in doing so, strengthening public confidence in SPS. We undertook a wide range of activity under our Governance theme in 2017-18. Significant achievements included: > The re-tendering of the Scottish Court Custody and Prisoner Escorting Service (SCCPES) contract for the provision of safe and secure transport of those in our custody to and from courts. New arrangements will commence in January 2019 with significant enhancements to quality of service. > The development and implementation of a Performance Management Framework which sets out our approach to performance. > The development of our Digital Strategy which provides a framework for the development of our digital infrastructure. > The implementation of a new portfolio governance structure for our Change programme which will ensure that our programmes are efficiently managed and effectively governed.

OUR PURPOSE IS TO CREATE THE RIGHT ENVIRONMENT AND SUPPORTS TO ENABLE THOSE IN CUSTODY TO ACHIEVE PERSONAL CHANGES.”

PERFORMANCE REPORT – SUMMARY SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

HOW WE MANAGE OPERATIONAL KPIs 1a and 1b Escapes from Secure Over 90% of these incidents occurred PERFORMANCE Custody are baseline indicators of SPS’ in the residential setting, including the We are committed to building a Safer delivery of secure custody. Separation and Re-integration Units Scotland and the safety and security of (SRUs). There has been a 50% increase our prisons is paramount. Violence and This year has seen the first escape in incidents within both SRUs and its associated activities are and will not from SPS custody for three years which prisoners’ cells. This appears to be as a be tolerated in any way. We face many occurred during an emergency hospital result of an increased unpredictability of the challenges that communities face escort which was supervised by our in prisoners’ behaviour whilst staff outside our boundaries and as such, staff. It occurred on 3 August 2017 and are carrying out their duties or de- we are never complacent. As a learning the individual was apprehended one day escalating conflict. Additionally, an organisation, we continue to evolve and later and returned to custody. increasing number of incidents have have introduced a number of initiatives occurred during the day to day support KPI 2a Serious Prisoner on Staff in our determination to reduce violence of people with mental health issues. assaults. The number of serious within our prisons. prisoner on staff assaults has resulted HMP & YOI Cornton Vale has had 24 Our response to the safety and security in an increase during this reporting year incidents, equating to 8% of the overall of our prisons remains robust and we from 5 to 14 incidents. number, of prisoner on staff violence in act in an agile manner to both new and this reporting year. All of these incidents There are a number of factors which existing threats. We have developed occurred in either Ross House or influence the increase in violence a Strategic Risk and Threat Group Dumyat House, the SRU. against staff. These include an increase which has corporate oversight of in SOCG nominals held in custody, the emerging risk and trends which KPI 2c Serious prisoner on prisoner an increase in the number of people includes the changes in the way assaults. Whilst the number of being managed under the influence of violence is perpetrated in our prisons. occurrences of serious prisoner on unknown substances which can result We manage the issues surrounding prisoner violence for the reporting in an increase in reactive violence, the Serious Organised Crime Groups year 2017-18 remains low, they have management of individuals who present (SOCG) within public sector Scottish increased from 74 to 94 incidents. an extreme risk of violence, and the prisons, the increase in use of unknown management of people with mental With the exception of HMP Inverness substances and the effect these health issues. and the Open Estate, where there have on both those in our care and were no assaults of this nature, these staff in establishments. This requires We continue to work with our partners assaults have occurred across the male continuing to work in partnership with and are reviewing our policy response to prison estate. a number of organisations, in particular the management of risk and violence. Police Scotland. There are a number of similar KPI 2b prisoner on staff minor and no contributory factors which explain We measure our operational injury assaults. The numbers against this increase, including the increase performance by gathering of Key this measure have increased from 193 in SOCG nominals held in custody and Performance Indicators, which can be to 284 incidents across all prisons for the conflict this generates, the evolving found at Appendix Eight. the reporting year 2017-18. nature of substance misuse within our establishments and the management of The majority (88%) of these incidents people presenting significant risk. occurred in the larger closed male establishments, with only 4% occurring across the smaller establishments of HMPs Dumfries, Greenock and Inverness.

PERFORMANCE REPORT – SUMMARY 13

KPI 2d Minor and No injury prisoner To support this, in November 2017, The overall reported measure has on prisoner assaults. There has the SPS published its commitment for reduced by 4% over the reporting been a marginal decrease in this set “Improving the Delivery of Purposeful period in comparison to the previous of recorded prisoner interpersonal Activity within the SPS” which can be year. This reduction is due to a number violence for 2017-18 compared to the found here www.sps.gov.uk/Corporate/ of factors that have impacted on people reporting period 2016-17, from 2,136 to Publications/Publication-5300.aspx. attending Purposeful Activity and 2,120 incidents. This clearly demonstrates Purposeful the positive and deliberate change in Activity as a core part of the services emphasis in how we proactively engage Over 80% of all prisoner interpersonal available to provide a holistic model of with those in our care. In addition, the violence occurs in the residential setting support for each person in our care. activity closures that were necessitated of the establishment, and over 60% This individualised approach can rightly by the adverse weather at the start of of all of this violence is in plain sight of mean that we need to deviate from March 2018 accounted for about 1% of staff. a one size fits all approach and offer this reduction. tailored packages of support which However, around 30% of this occurs focus on the quality of the nature of Absence across the SPS has also within an individual’s cell, away from our engagement, rather than simply impacted on the ability to maximise either staff witnessing this violence or on the quantity. It is with this, often Purposeful Activity availability where the being caught on CCTV, which is available subtle, shift of focus that the greatest need to support sufficient operational in most areas of residential houseblocks opportunities for unlocking potential staffing levels in a residential setting where association is permitted. and transforming lives exists. impacts on the availability of staff in the Offender Outcomes areas. The SPS reviews all violent incidents KPI 3a reports on the delivery of to ascertain the motives for these Purposeful Activity hours and the As outlined, we are shifting towards violent incidents, and have found that time formally recorded being spent on a person-centred approach which in around 20% of cases, this type of work and work related employability, focuses more on the individual and violence is attributable to the escalation education provided by our learning their development. Good citizenship is of minor disagreements. However on provider, training interventions such as a broader, more dynamic and therefore many occasions when the incident is vocational training and other positive more complex concept which requires fully reviewed locally, no motive can be prison based activities such as access time for relationship building, which ascertained. to physical education or spiritual and in itself is positive engagement and purposeful regime activity. KPIs 3, 4, 5 & 8 relate to personal pastoral care. development, rehabilitation and Attendance at counselling or During the reporting year, we progression. In December 2016, the rehabilitative programmes is also implemented a new Learning and Skills SPS published our Value Proposition recorded within this measure, and (LS) contract moving to a single provider which can be found at www.sps. the SPS has focussed on the high across all public sector establishments. gov.uk/Corporate/Publications/ risk groups in relation to programme This contract allowed for a period Publication-4733.aspx. This visionary delivery which support reduction of re-structuring where those staff document details how SPS will work in risk in relation to recidivism and across a number of establishments with those in our care to create the supports people’s progression through who were employed by the previous opportunities, circumstances and their sentence. During 2017, all provider moved, under the Transfer of respectful relationships needed to programmes delivered by the SPS had Undertakings (Protection of Employment) support fundamental transition. achieved accredited status through the Regulations 2006, to the new contractor. Furthermore, this details Our Theory of Scottish Advisory Panel for Offender While pre-planned, this has impacted Change and how we will work to provide Rehabilitation (SAPOR). on the service delivery across those person-centred activities that support establishments and in some prisons, our ambition of rehabilitative change. temporarily reduced the delivery of Purposeful Activity hours. When this re-structuring concludes this summer, service delivery is anticipated to improve significantly.

PERFORMANCE REPORT – SUMMARY SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

This SPS-wide single provision of KPIs 5a, on vocational and KPI 8 – % of Integrated Case the LS contract has allowed for the employment related qualifications, Management (ICM) case conferences introduction of Annual Learning Plans demonstrates a reduction in delivery with Criminal Justice Social Work which set out the aims and measurable of 7.5% compared to this time last (CJSW) in attendance is an indicator outcomes designed specifically for that year. Part of this reduction is due to which measures the success of establishment and the person identified the ongoing re‑structuring of the collaborative work which takes as requiring support. This new process new LS contract, and the number of place between Local Authority will help deliver the clear strategic qualifications that they have been able Criminal Justice Social Work priorities of the SPS in this area and to support individuals through during (CJSW) departments in the area the evidence the distance travelled for all this transitional period. establishment is located and/or the area those engaging in the service. the person resides in and is relevant KPI 5b, covering those vocational and for those serving sentences that are KPI 3b average Purposeful Activity employment related qualifications at subject to enhanced ICM. This process hours per week per convicted prisoner SVQ level 5 or above, demonstrates a is central to supporting people’s is the measure used to quantify the decreased position of 20% compared to progression, preparation for release and public sector establishments’ ability to this time last year. Part of this reduction community re-integration. meet the requirement of Rule 80 of the is due to the ongoing re-structuring of Prison and Young Offenders Institutions the new LS contract, and the number of ICM case conferences with social (Scotland) Rules 2011, which states that qualifications that they have been able workers in attendance remains at a high every convicted prisoner is required to to support individuals through during level (88.0%). Establishments continue work. this transitional period. to work closely with CJSW to ensure that attendance levels remain as high KPIs 4a and b relate to the delivery of Establishments continue to work with as possible with video conferencing literacy and numeracy as a percentage the Scottish Qualification Authority and often being used to facilitate this of the number of prisoner learning hours other formal qualification authorities important part of the progression and delivered by our LS provider(s). to determine available reward and re-integration process. recognition which are appropriate to Both measures continue to individual needs. Each qualification demonstrate improved participation received is an individual success and and performance. This is an encouraging for some, who have already attainted improvement in an important area of qualifications during their time in supporting people during their time in prison, they are achieving increased our care. recognition for securing attainment at higher levels.

PERFORMANCE REPORT – SUMMARY 15

Financial Performance & Results for the Year Financial performance is monitored throughout the year and reported to the Advisory Board and Risk Monitoring and Audit Committee on a routine basis. As an Executive Agency of the Scottish Government, SPS’s expenditure forms a section within the Scottish Government Justice Portfolio and the results will be recorded in the Scottish Government Consolidated Accounts for 2017-18.

The Scottish Parliament approves funds to the Scottish Government and related bodies at the start of the year and variations to these via the Autumn Budget Revision (ABR) in October and a Spring Budget Revision (SBR) in January. The Scottish Parliament approved a budget for SPS of £357,948k, details of which are contained in the Budget (Scotland) Bill 2017-18 Supporting Document. Details of the ABR and SBR budget revisions made by SPS can be found at www.gov.scot/Topics/ Government/Finance/18127/Documents.

As part of the SBR process, SPS are required to request budget cover for Annually Managed Expenditure (AME)1 to cover potential increases of provisions and impairment charges. SPS identified that tender price indices (TPIs), which underpin the indexation and valuation of the SPS estate, were continuing to increase which would result in impairment reversals2. For this reason, a net AME budget of £1,400k was requested, including provisions.

A comparison of the SPS final outturn with the SBR for 2017-18 is detailed below. The table does not include notional charges of £103k (Note 17 in the Notes to the Accounts).

Actual Revised Over/ Outturn Budget (Underspend) £000 £000 £000 Total Departmental Expenditure Limit (DEL)3 276,772 282,056 (5,284) Total Outside DEL Expenditure 4 71,906 72,701 (795) Total Annually Managed Expenditure (AME) (5,967) 1,400 (7,367)

Total Expenditure 342,711 356,157 (13,446)

Total expenditure for the year was £342,711k against the SBR of £356,157k.

The DEL underspend of 1.8% is attributable to maintenance and repairs and staff related provisions.

An AME underspend of £4,765k is attributable to movement in the indices used to value specialised and non-specialised properties between SBR and 31 March 2018. Details of impairment reversals and charges can be found in note 7. The remaining AME underspend is attributable to a change in the timing of a settlement of a liability in relation to equal pay claims raised by non-operational colleagues following the decision to make operational payments to Prison Officers and First Line Managers in recognition of their continuing engagement in a review of their roles.

1 AME budgets are used to manage expenditure which is demand led or exceptionally volatile in a way that could not be controlled and where the expenditure is so large that it could not be absorbed in DEL. 2 An impairment reversal eliminates any losses charged to the SOCNE in prior years as a result of market variations. 3 DEL budget limits are set in the Spending Review. 4 Outside DEL expenditure includes costs associated with PPP/PFI contracts for HMP Addiewell and HMP Kilmarnock and the Court Custody and Prisoner Escort Service Contract.

PERFORMANCE REPORT – SUMMARY SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Net expenditure for the year The Statement of Comprehensive Net Expenditure (SOCNE) for the year is shown on page 60.

SPS has reported net expenditure for the year of £331,225k (2016-17 £331,038k).

The following table shows the reconciliation between the actual outturn and the net operating costs reported in the SOCNE. The reconciliation takes account of non-cash charges and HM Treasury Consolidated Budgeting Guidance.

£000 Total expenditure 342,711 Add Notional charges (note 17) 103 342,814 Less capital additions (note 4 & 5) (11,589) Net expenditure for the year (SOCNE) 331,225

Statement of Financial Position The Statement of Financial Position is on page 61.

Changes in property, plant and equipment and intangible assets During the year, SPS purchased property, plant and equipment and intangible assets at a cost of £11,589k (2016-17 £2,400k). Additions of £4,205k, net of impairments, relate to the purchase of land for the future site of HMP Highland and a Community Custodial Unit in Maryhill, Glasgow. Land and buildings were either valued or indexed at 31 March 2018 resulting in an increased value of £93,675k.

Trade and other payables Included within payables is an amount of £89,058k (2016-17 £93,444k) representing the imputed finance lease5 for properties at HMP Addiewell and HMP Kilmarnock and for vehicles used in the Court Custody and Prisoner Escort Contract.

Payment of Creditors SPS’ policy is to pay all invoices, not in dispute, in 30 days or the agreed contractual terms if otherwise specified. SPS aims to pay 100% of invoices, including disputed invoices once the dispute has been settled, on time in these terms.

During the year ended 31 March 2018, SPS paid 99.1% (2016-17 99.7%) of all invoices received within the terms of its payment policy.

SPS has sought to achieve the Scottish Government’s aspiration to pay suppliers within 10 days. Payment performance on this basis was 93.5% (2016-17 94.5%).

5 Imputed finance lease represents the liability for the capital value of the PPP/PFI contracts.

PERFORMANCE REPORT – SUMMARY 17

PERFORMANCE REPORT – PERFORMANCE ANALYSIS

The purpose of this section is to provide a detailed analysis of the development and performance of the organisation in 2017-18.

PERFORMANCE REPORT – PERFORMANCE ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

PERFORMANCE ANALYSIS

STRATEGIC THEME PROFESSIONALISM

STRATEGIC Unlocking potential OUTCOME We will have the right people with the right skills in the right place at the right time.

KEY SUCCESS INDICATORS (KSIs) We will have:

1 Redesigned the education, training and qualifications of frontline staff in support of the Prison Officer Professionalisation Programme (POPP) that ensures our staff are equipped to practice with a person-centred, asset-based approach. 2 Designed the new operating model for the service in a way which will systematically facilitate the delivery of custodial services which are person-centred and asset-based.

ESSENTIAL ACTIONS 2017-18 BY SUPPORT WHEN PERFORMANCE Publish the SPS Workforce Plan. CS Q4 Develop a detailed proposition and products, including the OCE CS/OD Q4 delivery of professional qualifications, for POPP. Implement agreed actions across public sector establishments.

Our Professionalism theme recognises Workforce Plan Prison Officer Professionalisation that our people are our most valuable SPS has developed a Workforce Plan Programme asset and important resource. Good (2018-2023) to ensure the organisation Work has progressed to redesign progress has been made with both of builds and retains the capacity and operational delivery systems (the the Essential Actions which sit under capability to deliver high quality services operating model) based around this theme. POPP is a transformative over the next five years and beyond. the concept of a single tier Prison programme which continues The plan was informed by identifying Officer/Justice Professional role; the throughout and beyond the lifespan the key workforce challenges through development of a Custody Security of the Corporate Plan. We have made engagement and consultation with the Officer role to undertake transactional good progress towards achieving business. The emerging challenges have security duties and the standardisation our Strategic Outcome through our been considered against the themes of arrangements across establishments Essential Actions for 2017-18. In turn, of Resourcing, Career Development, including the development of a we can evidence tangible progress Leadership and Governance. The proposed ‘dynamic day’ which will towards delivering on our KSIs. resulting actions under each theme are promote consistency of service However it is important to recognise designed to contribute to organisational delivery across establishments. Key that continued progress remains reputation, culture, performance focal points include the assurance of subject to agreement being reached and sustainability, and assure overall establishment proposals in respect with workforce representatives and organisational capability. The final of POPP, the development of a the Scottish Government regarding Workforce Plan was tabled at EMG on comprehensive business case, a ballot both the model and the funding as 20 March 2018 and will be published in with the Prison Officers Association progression of POPP is contingent spring 2018. (Scotland) (POA(S)) membership upon the realisation of efficiencies for and corporate communications. The investment in front line services. current timeline has been extended to

PERFORMANCE REPORT – ANALYSIS 19

facilitate assurance of establishment The Prison Officer Professionalisation these risks a considerable amount of proposals for reviewed local operating Programme (POPP) effort has been put into developing models. It is not anticipated that this POPP is a significant and POPP and good progress has been will compromise the establishment transformational programme of public made over the last year, taking the of professionalisation foundations sector reform. It is central to the Programme from proof of concept in summer 2019, rather it will help achievement of the organisational vision to detailed propositions through to consolidate those foundations. that places staff working in prisons at pragmatic actions, within a clear and Information from the assurance the forefront of building and sustaining robust governance framework. process will feed into efficiencies, positive relations with those in their care ballot information, professional and to act as catalysts for human change. A detailed and comprehensive joint qualification delivery and the business It is at the heart of our Value Proposition. proposal is now in the final stages of case. Additionally and separately, there POPP will secure the transition of drafting, having been developed in is enabling work to be progressed on Prison Officers to Justice Professionals partnership between SPS and senior a new Job Evaluation System (JES) and embed an ethos which embraces representatives of the POA(S). This which will be required to support a professional practice, continuous proposal will be turned into a brochure revised pay policy. Ensuring that the learning, personal professional and personal illustrations for Prison JES is compliant and equality tested development and the exercise of Officers, prior to a ballot of the POA(S) will be crucial to enabling POPP work professional autonomy. membership. to progress. A ballot in the summer of 2018 is targeted subject to conclusion It will create an environment that will A communications strategy has been of the assurance procedure. A holistic establish Prison Officers as a profession developed and significant stakeholder and prioritised approach is being taken that is recognised across the Criminal engagement has taken place over towards communications, with use Justice sector and beyond, who will the course of the year with staff and being made of engagement sessions, sustain high levels of service, with the partner agencies including TUS, local drop in events, video and the support of a bespoke Higher Education Scottish Government and the National SharePoint intranet system. Diploma and trained managers operating Health Service. Information has been new, fit for purpose support systems. provided to all staff via staff updates, including detailed presentations and As with all programmes of significant establishment guidance; a question and transformational change, the answer brief has also been provided to introduction of POPP is not without its address key questions. risks and as such it is reflected on the SPS Corporate Risk Register. To mitigate

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

The effort over the course of the year The delivery of the professional External scrutiny and positive by local teams at establishments and qualification will be planned to feedback have been provided by the the National Operational Delivery reflect business needs to ensure Government Gateway team and the Team has allowed proposals for new operational viability and affordability. SPS Auditors, Scott Moncrieff. We have rostering systems to be developed. Job descriptions have been developed also benefited from a POPP Oversight Those along with the other project for Prison Officers, establishing them Group, comprised of senior justice proposals have been submitted for as Justice Professionals. The job figures from around the UK. The group extensive and rigorous review by the descriptions are informed by ten quality provides guidance and advice on a POPP Board in conjunction with the statements which will provide the regular basis. Director of Operations. The POA(S) performance measures required for has had the opportunity to be fully the new role, which will have a person The Programme is nearing the end involved at all stages, with Scottish centred approach and which will support of its development phase, before National Committee members the self-transformation of those in our entering a transitional phase, being fully involved through the care. A new role of Custodial Security assuming a business case is approved Board and the assurance procedure, Officer will be introduced outwith the and a successful ballot has been which is nearing completion. The justice job family to perform a support undertaken by the summer of 2018. extra effort involved has extended role for SPS and to provide opportunity This Programme and these current timelines, however this risk to take routine tasks away from the achievements place the SPS at the was anticipated and planned for and professional Prison Officer. forefront of public reform and paves as such will not affect the overall the way for the true recognition of the programme aim of establishing the HR enabling processes have been Justice Professional. foundations of professionalism by the progressed with equal vigour, including summer of 2019. The additional effort development of a new Job Evaluation and scrutiny provided will ensure that System, Pay and Grading Structure and the Programme has a sound baseline the basis of a new appraisal procedure. and help to maximise the reach of the foundations that are secured and the benefits of the programme to stakeholders.

PERFORMANCE REPORT – ANALYSIS 21

STRATEGIC THEME PARTNERSHIP STRATEGIC Unlocking potential OUTCOME Our collaboration with partners results in enhanced service provision and better personal outcomes for those citizens in and leaving our care. KEY SUCCESS INDICATORS (KSIs) We will have:

1 Worked with partners through Community Justice partnership arrangements to ensure that those in and leaving our care will have better access to housing, health and welfare benefits services. 2 Defined our relationship with Prison Based Social Work services to ensure that it better meets the needs of those in our care and aligns with our new operating model. 3 Identified service delivery options with partners that address the health and social care needs of those in our care.

ESSENTIAL ACTIONS 2017-18 BY SUPPORT WHEN PERFORMANCE Deliver, in collaboration with key stakeholders, products S&I OD Q4 identified by the project to improve the management of people in our care who require social care support. Take forward relevant recommendations from our work with OD/S&I Q4 internal and external stakeholders and partners to fulfil our obligation to establish smoke free prisons. Agree and consolidate arrangements with partners to support S&I OD Q4 the Throughcare journey and deliver outcomes which support successful reintegration back into communities. Work collaboratively to develop strong mechanisms for strategic S&I OD Q4 engagement with key sectors and partners (including Community Justice partnership arrangements) which support the delivery of the SPS contribution to national strategic objectives including the Strategy for Justice in Scotland and the development of enhanced services for those in and leaving our care.

Our Partnership Theme acknowledges Partnership arrangements have we have engaged constructively with that prisons do not exist in isolation and been put in place by the Scottish a range of statutory and Third Sector that strong and effective partnership Government to progress the agenda partners. We have not made as much working is essential to achieving the around the provision of health and progress as envisaged in relation to the best outcomes for those in our care. social care in prisons and we are making future delivery of Prison Based Social Overall we have made good progress a full contribution to make necessary Work services. However a programme towards achieving our Strategic improvements. During the year, the of action to define the relationship Outcome and delivering our KSIs. A decision was taken to accelerate the between SPS and Social Work services strong contribution has been made to programme to deliver smoke free has been agreed with colleagues in Community Justice Scotland and to prisons and the project was successfully Social Work Scotland. local community justice partnership scaled up. The provisions of the Third arrangements. At national level, Sector framework are being met and

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Health and Social Care be fully smoke free by the end of 2018. Strategic Engagement Identifying service delivery options In order to achieve this, local project The new national body Community for those in our care with health and teams have been established in each Justice Scotland (CJS) went live in social care needs is an increasingly prison. Amendments to the Prison April 2017 as did local Community important challenge for SPS because Rules came into force in February 2018 Justice partnership arrangements. We of the increasing percentage of the enabling single use e-cigarettes to be supported the establishment of local prison population with identified or introduced across the SPS estate. It is partnership arrangements by equipping anticipated health and social care anticipated that rechargeable vaping our Governors and senior colleagues needs. The service delivery landscape is devices will be introduced in all prisons to act as ‘place’ representatives within complex. Whilst health care in prisons is by July 2018. Work will continue in 2018- partnership arrangements. In this role the responsibility of NHS health boards, 19 through transition, tobacco removal they act on behalf of Scottish Ministers social care remains the responsibility and post implementation plans. providing a prisons perspective and of local authorities. In terms of service input to local planning processes. delivery, prison based health and social Throughcare care may (or may not) be delegated Arrangements are in place in support Partnership mapping tools and process to Health and Social Care Partnership of the SPS duty to co-operate. Place have been developed and subject to roll arrangements. leadership arrangements have been out as part of our overall partnership reviewed and improvements are being strategy. The provisions of a Third In recognition of the significance of taken forward including the sharing of Sector framework are being met while this issue, the Scottish Government strategic and personalised data with further development is being taken established the Health and Social Care local partnerships. There has been a forward around local government, in Prisons Programme Board (HSCPPB) particular focus on introducing the Community Justice Scotland, Social to determine the responsibility for shared standards for sustainable housing Work, housing, and Department of social care in prisons and identify arrangements on release (SHORE Work and Pensions (DWP). The shape delivery models. This HSCPPB will Standards) as well as the resourcing of strategic engagement with DWP, progress work in relation to four and configuration of housing services local government, Social Work, Third workstreams during 2018-19 (Quality, across the estate. Key challenges around Sector and CJS made significant Outcomes and Improvement, welfare reform including the roll out of progress in 2017-18 although further Governance and Leadership, Health and universal credit and the changing role of clarity is required around the precise Social Care Integration and Clinical IT). Job Centre Plus within establishments role of Prison Based Social Work. SPS representation has been identified continue to be responded to. The To this end work was undertaken in for each of these workstreams and independent evaluation of Throughcare 2017-18 towards the development of work will continue in 2018-19 and the provision undertaken on behalf of SPS by a Memorandum of Understanding. It is work will also inform the SPS approach Reid-Howie Associates was launched in intended that this will replace existing to ‘population management’ (how we October 2017 which identified strengths Service Level Agreements pending manage within the estate the different and areas for improvement. The report agreement on the future shape of needs of those in our care). identified that there was inequity of service provision. This area is one of access to Throughcare provision across our KSIs and as such will be subject to Smoke Free Prisons public and private sector establishments a continued focus during 2018-19. The SPS had been working towards a as formal arrangements and access work will continue and is reflected in our commitment to implement smoke routes were not in place in the privately Annual Delivery Plan 2018-19. free prison arrangements during 2019. operated prisons (HMP Addiewell and However, following the publication of HMP Kilmarnock). An Action Plan was the Tobacco in Prisons Study (TIPS) developed to address the evaluation report in 2017 which detailed the impact outcomes. Recommendations for the of second hand smoke on staff, the future delivery of Throughcare support decision was taken to accelerate the were considered by our EMG and the delivery of this commitment to ensure SPS Throughcare Strategy (developed in that it was implemented as soon as consultation with the Third Sector) was was reasonably practical. It is now the published in March 2018. intention that Scotland’s prisons will

PERFORMANCE REPORT – ANALYSIS 23

Smoke Free Prisons established along with implementation and Young Offenders Institutions The Tobacco Control Strategy for teams in each establishment. A robust (Scotland) Rules 2011 required to Scotland was launched in 2013 and communication and engagement support the implementation of smoke sets out the Scottish Government’s strategy has been developed to ensure free prisons. The first amendment, aspirations for a tobacco free that we are engaging all who will be which came into force on 8 January generation of Scots by 2034. The impacted by the change and also to 2018, enables a Prison Officer to strategy states that in line with engage those who we are depending on instruct a prisoner to stop smoking developments across Scotland, for the smoke free prisons project to be and open the windows and vents in creating a smoke free prison service a successful one. their cell for a period of 30 minutes should be seen as a key step on the before the Prison Officer begins a cell journey to creating a smoke free Throughout the year there has been certification process, and not to smoke Scotland. significant engagement with the NHS whilst the process is completed. It also local boards and nationally via Health allows prisoners to use e-cigarettes/ Whilst SPS are fully committed to Scotland. This engagement is a critical nicotine vapour products (collectively delivering smoke free prisons, the risk mitigation strategy as it helps to referred to as “NVPs”), the use of which complexity and dynamics of a prison ensure that there are suitable supports was previously prohibited in Scottish environment present a number of in place for those in our care. In future prisons. The second amendment which risks which have to be assessed and years this ongoing engagement will go forward during the reporting managed sensitively to ensure the and commitment will continue to be period 2018-19 will prohibit the use successful introduction and ongoing necessary to continue to mitigate and possession of tobacco products by implementation. the ongoing risks associated with the prisoners. continued management of smoke free In order to inform decision making, prisons. Engagement has also taken In order to inform those in our care the Tobacco in Prison Study (TIPS), place with the Scottish Government, about the project we decided to take which reported on staff exposure to Community Justice Partnerships, SPS a co-production approach which was second-hand smoke, was undertaken. staff, the families of those in our care achieved by working with the Creative As a direct result of the findings of the and Trade Union Sides. We also launched Media Group at HMP Shotts. The group TIPS study we committed to making a Public Consultation Exercise on 10 developed our national campaign our prisons smoke free by the end of September 2017 on our website which message and shaped the branding November 2018. was open to all members of the public for all communications which have and our Third Sector partners. been issued including our monthly In order to meet this target, and countdown posters. This has allowed manage the implementation risks, During 2017-18 we took forward the those directly affected by the changes a national project team has been first of two amendments to The Prisons to have a say in the process.

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Throughcare TSOs will: Impact of the service and testimony from service users Protecting the public is a core role > encourage those in our care serving of SPS contributing positively to the short term sentences to engage in Within the evaluation there is a strong Safer Scotland agenda. throughcare; shared view that the throughcare support service had helped develop The development and expansion of > support service users in and leaving understanding and improve access Throughcare Support is an important our care on their journey into to advice and support with these part of the SPS Purposeful Activity desistance; issues. SPS staff, and almost all of the Programme and underpins the SPS > work with service users to prepare for, specialist service providers believed Vision of delivering transformational and successfully make the transition this to be the case. change through a person centred from custody into the community; approach. “There were things I’d just given up on. > work collaboratively with service It gives you a heads up in trying to get Throughcare support helps to ensure users families, colleagues and our forward in life.” that a network of community based partners to develop an asset-based, “Because you’re so worried about support is in place for those leaving individualised plan; and everything, throughcare explained our care. > act as an advocate on the service everything and took me to every user’s behalf while encouraging service Forty-one Throughcare Support appointment – they helped me user motivation to change through Officers (TSOs) and three Throughcare reconstruct myself back into the sustained engagement with key Support Managers (TSMs) have community.” services. been supporting those in our care “I couldn’t have done it myself. Being serving short-term sentences back This approach will build self-efficacy and with the TSO was a big weight off my into the community across eleven is at the heart of unlocking the potential shoulders. I wasn’t on my own and I establishments since April 2015. and transforming the lives of those in might not have done it if I had been.” our care while providing service users The independent evaluation of the “The first day out there is no way I would with the skills to take ownership of their Throughcare Support Service was have sorted out my benefits and got a plan and empower them to be effective carried out between January and temporary flat.” citizens. March 2017 with the report published “If it wasn’t for them, then xx (partner) at an event at SPSC on 25 October Successful delivery is dependent upon would have no clue about benefits and 2017. The event was supported by the collaborative working across the range no money, and they’d be back offending Cabinet Secretary for Justice and the of criminal and community justice again.” SPS Chief Executive. An evaluation organisations and universal mainstream “Pretty much everything has been action plan has been developed services such as Education, Health, helpful. My main thing was housing and to support the recommendations Welfare and Housing. I saw the homelessness people and got highlighted within the evaluation told I was getting a house in xx (area).” report. SPS will work collaboratively with partners when developing our approach “ was told I wouldn’t get housing, but The Throughcare Strategy document, to throughcare to support those leaving xx (TSO) told me to speak up for myself which was published in February our care. and we got it sorted it out.” 2018 sets out the future for SPS “My previous experience, it was Throughcare Support Service. first stop this or that, drink or drugs, whereas if someone takes you then it’s a distraction from that. You do something more constructive and positive. If you walk out with nothing to do, a lot of people will fail.” “I had no doctor in 10 years. I wouldn’t have bothered before.”

PERFORMANCE REPORT – ANALYSIS 25

STRATEGIC THEME PURPOSE STRATEGIC Transforming Lives OUTCOME Our communities are safer because those citizens in our care are supported to build on their assets and return to their communities as productive citizens. KEY SUCCESS INDICATORS (KSIs) We will have:

1 Developed and implemented new procedures in relation to case management which support a person-centred approach with a clear linkage with Purposeful Activity. 2 Delivered the outputs identified by our strategic programme of work to improve Purposeful Activity and place rehabilitation at the centre of our engagement with those in our care. 3 Developed the new model for women in custody with a focus on recovery that is designed around a smaller national facility and innovative community custody units. 4 Taken forward our Vision for Young People in Custody through the provision of a range of age appropriate opportunities to enable them to prepare for a positive future.

ESSENTIAL ACTIONS 2017-18 BY SUPPORT WHEN PERFORMANCE Deliver the products identified by the strategic programme of S&I OD Q4 work to improve Purposeful Activity. Implement the Strategy for Young People in Custody in order S&I Q4 to improve participation and support the transition to positive destinations. Develop the Scottish Government’s vision for women through S&I CS Q4 the implementation of the SPS Women’s Strategy.

Our Purpose theme is focused on Purposeful Activity Strategy for Young People creating the right environment and Our new Purposeful Activity Framework The number of young people in our supports to enable those in our care was launched in November 2017. care has fallen significantly in recent to achieve personal change. It covers a The Framework introduces a national years. This has allowed us to work range of policy, practice and strategic delivery model and focuses on how more intensively with those who do initiatives. We have made good progress the SPS intends to secure change in come into our care. Our commitment in delivering our Strategic Outcome this area and requires establishments to Young People was manifested through our Essential Actions relating to complete an annual Purposeful through continued implementation of to Case Management and Purposeful Activity Action Plan as part of their our Strategy for Young People and the Activity; the Strategy for Young People business planning process. Purposeful use of Positive Future Plans for short and the Strategy for Women and activity Activity Plans are the means through term offenders which are designed to was undertaken in relation to all the which individual establishments will support successful reintegration into KSIs. contribute to the delivery of Purposeful the community. Positive Future Plans for Activity. A Purposeful Activity Strategy short term offenders are increasingly Group has been set up to implement being utilised. These identify strengths the Framework and to develop the and needs, record progress in custody Purposeful Activity Dashboard test in an and create a plan which is aimed at increased number of establishments. successful reintegration into the

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

community. Utilising the information Strategy for Women in March 2018 in respect of the WNF gained from the indicator assessments, Significant progress has been made and work on the procurement process strengths and issues for participation in collaboration with partners with commenced. Demolition and site were identified for participation in implementation of the Women’s clearance work has commenced at activities and learning. Activities Strategy through planning for the new the first CCU site in Glasgow and is have been realigned and actions Women’s National Facility (WNF) at scheduled to be completed in June implemented to increase participation Cornton Vale and the identification of 2018. The work which has been on- across all population groups. A series of sites in Glasgow and Dundee for two going to select a site in Dundee is initiatives and events have taken place Community Custody Units (CCUs). nearing completion. Work to develop with co-production between young Design work for the Community the regime and operating procedures people and staff, as part of Year of Custody units has taken place and which will form the basis of the new Young People. A Young People strategy consultation has took place with model of custody continues to progress. governance group has been established. communities in Maryhill, Glasgow and The criteria which will inform a women’s Dundee regarding the development journey through custody was approved of the new units. SPS submitted the by the Programme Board in February planning application to Stirling Council 2018 subject to Chief Executive sign off.

PERFORMANCE REPORT – ANALYSIS 27

Young People The Year of Young People themes of The ambassadors have created a SPS gives very high priority to our work Participation, Education, Health and 2018 calendar of events in close with the young people who are in our Wellbeing, Equality and Discrimination, consultation with the young people care. The SPS Vision for Young People Enterprise and Regeneration and of HMP & YOI Polmont across the six in Custody seeks to ‘use the time a Culture, link very closely with the SPS key themes of Year of Young People young person spends in custody to Vision, Mission Statement, strategic 2018. To date the ambassadors have enable them to prepare for a positive priorities and particularly the Vision for organised and run seven successful future’. To help to achieve this, there Young People in Custody. events with over 270 people actively has been a strong emphasis in the past engaging. The launch event in March year on raising the young people’s To support young people within HMP 2018 saw the Cabinet Secretary for levels of engagement in learning & YOI Polmont to participate in the Justice and the Minister for Childcare activities that will help them to Year of Young People, a co-production and Early years in attendance. The contribute positively when they return approach was taken which saw a group launch event was co-designed and to their communities. of 14 ambassadors being recruited co-delivered by the ambassadors and in August 2017. Since that time the young people within Polmont and was Among the wide range of activities ambassadors have created both a recognised as a great success by all. in HMP & YOI Polmont designed to mission statement and a young person’s do this, young people in Polmont are charter outlining what they hope to Quotes from Young People participating in the Year of Young achieve over the coming year. “Since being an ambassador I have People 2018. This year is being The group of ambassadors have had the opportunity to plan and marked throughout Scotland as an organise events for other young opportunity for the generations to been working hard to gain skills and experiences which will help them in people. My confidence has grew as a come together and celebrate the result……. I have even spoken in front nation’s young people. It seeks to give their roles as ambassadors by attending training around event planning, working of 100 people something I didn’t think them a stronger voice on issues which I would ever be able to do” affect their lives, showcase their ideas as a team and evaluation skills. All of and talents, and create a more positive the ambassador team will be gaining “Being an ambassador has let me perception of them in society. recognised qualifications in volunteering achieve the first qualifications I have and working with others. ever had”

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Women’s Strategy and supervision. The Assessment May/June 2018. The ‘phasing’ work The Cabinet Secretary for Justice Centre is designed to accommodate up to relocate some services on the announced in June 2015 that Scotland to 25 women on a temporary basis to existing site is now well underway and would be adopting a new approach allow for a period of initial assessment on schedule. This work is critical to to the management of women in in order to determine the most the overall plan to ensure that HMP custody. A key feature of the approach appropriate location and support for & YOI Cornton Vale can continue would be the construction and each woman entering custody. to be operational throughout the operationalisation of bespoke facilities construction of the new facility which designed to support the delivery of The national facility will provide a range is scheduled for completion in late a new model of custody. The new of services within a safe and secure 2020. facilities would comprise of an 80 environment which include a health place National Facility with a separate centre serviced by Forth Valley Health In this financial year it was confirmed Assessment Centre together with five, Board, education facilities for teaching that the first two CCUs would be 20 place Community Custody Units, and developing life skills, outdoor located in Glasgow and Dundee. two of which would be prioritised areas, a gymnasium to promote healthy Construction work on both CCUs is initially. living and fitness and a quiet area for scheduled to commence in the spring contemplation where women can also of 2019 with a view to both facilities The new model of custody would aim attend faith services. being operational by the end of 2020. to reduce reoffending through person centred approaches that are both The concept design for the National The site for the Glasgow CCU was gender specific and trauma informed. Facility has been completed and a identified in Maryhill. The site has been planning application was made to acquired and is in the process of being The new women’s national facility is Stirling Council in March 2018 with cleared and prepared for construction. being built on the existing site of HMP anticipated approval in July 2018. A comprehensive communications & YOI Cornton Vale. The purpose of Work is currently on-going to prepare strategy has been developed. The key this facility will be to support women the ‘Invitation to Tender’ (ITT) for the objective of the plan is to ensure that who are assessed as potentially construction of the National Facility all stakeholders are consulted and kept requiring more intensive management which it is intended to be issued in up to date with progress.

PERFORMANCE REPORT – ANALYSIS 29

Several public information events team has engaged with women both in > “I have been in custody and a unit like have been held in the Maryhill area to custody and those who have previous this would be better, I would like to provide local residents and service history of custody at various stages support women in a CCU and show providers with further details on throughout the development phase. them that they can change their lives the building plans and proposal. The A number of events were previously for the better” events have been well attended facilitated in collaboration with and the response from the local Women’s Services in the Community The programme team have also community encouraging. for women with past history of custody facilitated a number of events to whereas this year the focus has been on engage with staff, particularly seeking The preferred location for the second engagement with women in custody as views on specific design elements for CCU is on the site of Our Lady’s well as wider partners and stakeholders. both the Women’s National Facility Primary School in Dundee which is The women have clear views on the and CCUs. A range of partner agencies closing and scheduled to become environment feeling less institutional have also collaborated as part of the vacant in the summer of 2018. Work and have been engaged in identifying design process and engagement has to progress acquisition of the site the services and approaches that would taken place with Local Councils, wider and submit the relevant planning help them address a range of issues. stakeholders and local communities. application is underway. Public information events similar to those A few quotes from the women in carried out in Maryhill, Glasgow are in relation to the CCUs: the process of being planned to take > “I was lost in Cornton Vale, when the place early on in the next financial year. numbers were high and would not have The overall approach has been to my children visit. A small unit like this actively engage with stakeholders and would have made my time in custody service users in the design concepts more productive”. and also in relation to services, delivery > “Getting my children to visit and model and ethos. The programme getting more support would have helped me”.

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

STRATEGIC THEME GOVERNANCE

STRATEGIC Delivering Best Value OUTCOME Our services are efficient, effective and provide value for money. KEY SUCCESS INDICATORS (KSIs) We will have:

1 Discharged our obligations under the Public Sector Equality Duty including the delivery of our Equality Outcomes for 2017-20. 2 Changes to the configuration of the prison estate will have been made on the basis of a strategic and evidence based approach to population management in order that those in our custody are accommodated in appropriate settings. 3 Implemented a structured approach to continuous improvement which will embed routine self-evaluation into the planning and performance cycle to inform our programme of service improvement and development. 4 Developed proposals in relation to our HQ function which support efficiency, effectiveness and value for money in terms of location and flexibility.

PERFORMANCE REPORT – ANALYSIS 31

ESSENTIAL ACTIONS 2017-18 BY SUPPORT WHEN PERFORMANCE Develop and/or revise policies, practices and guidance to meet S&I OCE/CS/ Q4 SPS obligations contained within wider justice sector reform and OD relevant new or updated legislation and standards. Agree a strategic approach to Population Management and S&I/OD Q4 Estate Configuration and deliver the identified priorities. Develop and implement a structured approach to continuous S&I CS Q4 improvement supported by evidence and informed by user voice. Deliver the Scottish Custody Court and Prisoner Escort Service OD/CS Q4 (SCCPES) contract by working with Multi Agency Liaison Group (MALG) partners to identify future service requirements and retender the service. Assess, plan and implement a restructured governance process OD Q3 to support audit and assurance practices across the Operations Directorate which improve standards in SPS prisons and reduce the volatility spend profile. Develop SPS Information Technology structure including OD/CS Q4 concluding the Digital Transformation Service engagement with Scottish Government, implementing an improved electronic records management system and continuing to develop the use of e-commerce with a focus on e-procurement. Implement a Strategic Risk and Threat Assessment Group (SRTG) OD Q2 responsible for ongoing assessment which will respond to the evolving intelligence picture across all prisons. Develop an internal shared services model for finance. OCE Q4

Implement revised Portfolio approach and create overall portfolio OCE Q4 plan enabling the identification and management of key portfolio dependencies and priority areas aligned to the corporate strategic position. To take forward design and specification work for development of OCE Q4 future Headquarters. Diversifying SPS workforce through further development and CS Q4 implementation of the SPS Equality Outcomes.

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Our Governance theme covers the Population Management and Develop and implement a range of activity we will undertake to Estate Configuration structured approach to continuous ensure the efficiency and effectiveness An outline Population Management improvement supported by evidence of SPS in order to ensure public Strategy was developed and liaison and informed by user voice. confidence in SPS. Overall good undertaken with the Scottish The SPS Performance Management progress has been made across the Government to ensure alignment. Framework (PMF) was approved by EMG range of governance activity. With Advice was provided to Ministers on on 13 December 2017 and actioned in regard to our KSIs significant work older people and agreement reached February 2018. Proposals for a review of has been undertaken in relation to on a dispersed approach in the future. KPIs were agreed by EMG in December implementing our equality outcomes. A Knowledge Exchange Event was held 2017. A process and critical path for Work was undertaken with the on Sex Offenders with a submission completing the review in 2018-19 is in Scottish Government to develop our subsequently considered as part place. The review will take account of approach to population management. of the overall approach. Population a range of perspectives on measuring It is recognised that this is a longer ‘leads’ across SPS have provided performance within prisons at both term piece of work that will continue strategic input into the development corporate and establishment levels to evolve. We have developed our of the strategy and a draft has been with the latter including the experience approach to continuous improvement, considered by EMG and the Scottish of those in custody, staff and partners. whilst at the same time ensuring Government. Discussions with the Proposals for the development of a linkages with improved arrangements Scottish Government are ongoing in structured approach to self-evaluation for managing our change portfolio. relation to further drafting including the were considered in February 2018 and This ensures a consistent approach vision and the process for consideration it was agreed in principle that adopting to performance management and by Ministers and engagement with and adapting the Care Inspectorate reporting. However, planned activity key stakeholders. The Chief Executive Quality Indicator Framework was the in relation to the relocation of our has given a clear steer on the need appropriate way forward. Work on headquarters function has been for SPS and the Scottish Government the development of the model would paused due to the capital expenditure to articulate a shared vision and for continue in 2018-19. allocation. the strategy to describe the journey towards achieving that vision. The Scottish Custody Court and Prisoner Policies, practice and guidance timeline for this action has been re- Escort Service (SCCPES) contract A significant amount of activity has been profiled. It has been agreed with the The contract was successfully undertaken. The Purposeful Activity Scottish Government that the approach retendered with a contract award being Framework, the SPS Family Strategy and to co-production of a shared strategy made at the end of March 2018. the SPS Corporate Parenting Plan and will be implemented by Q4 2018-19. anti-bullying strategy Think Twice have Re-structured governance process to been published. The Case Management support audit and assurance practices Pathway has been progressed with A revised Business Review process testing being undertaken in a number of and meeting structure has been establishments. The Case Management implemented across establishments. Pathway is currently being developed while the tests are ongoing. However the Risk Management Team Guidance has been delayed. It is anticipated that this will be published later in 2018.

PERFORMANCE REPORT – ANALYSIS 33

Information Technology Portfolio approach Diversifying the SPS workforce Digital Strategy engagement with the For our major change projects a new through further development of Scottish Government was completed. Portfolio Governance structure is now the SPS Equality Outcomes A programme for change will be taken in place, led by a revised and refocused A revised Equality and Diversity policy forward during 2018-19. Change Portfolio Board. An overall was developed. This will inform the portfolio plan has been created and is recruitment and selection process when Strategic Risk and Threat being actively utilised by the Change implemented. Name-blind recruitment Assessment Group (SRTG) Portfolio Board. Work will continue to has been implemented. Equality The SRTG was established. The group refine and refresh the portfolio plan considerations are being embedded will have responsibility for ongoing as projects and programmes of work in the Workforce Plan to ensure that assessment which will respond to the evolve over time. at both national and local levels we evolving intelligence picture across all can respond to need and reflect wider prisons. Headquarters society. Action is being undertaken The project, as defined in the 2016 to support Disability Confident Level Shared services model for finance Strategic Business Case and the initial 1 and this should lead to attracting a In order to support the development Project Brief is currently paused. The greater number of disabled candidates. of the shared services model, Financial Business Case is being revised. The Organisational Capability workshops Policy & Services put in place a 2018-19 Capital Expenditure allocation will provide a greater understanding of temporary member of staff with a remit from the Scottish Government means the workforce profile, along with current to support finance managers in the that funds for the proposed new and future challenges. field where skills and knowledge gaps HQ at Polmont may not be available. have been identified. Specific actions Other parts of the Worksmart project have followed internal meetings across that underpin Smarter Working the Directorates to scope the model, such as enhancements to digital including the re-direction of resources infrastructure, records management to ensure cover in establishments and HR should still be taken forward, and the creation of a new corporate subject to affordability. The timeline job description for Finance Managers. and resourcing of any critical activities Further work will be driven by the during 2018 and 2019 will be considered outcome of a review commissioned as part of the corporate planning by the Chief Executive of structures, process going forward. reporting arrangements, capabilities and resources associated with the management of finances within the SPS.

PERFORMANCE REPORT – ANALYSIS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

> HMP Barlinnie – All accommodation Scottish Court Custody and Prisoner A Scottish Government Gateway halls and association space LED Escorting Service (SCCPES) review of this programme of work lighting; Court Custody and Prisoner Escorting was completed in February 2018. Services have been outsourced This is the second gateway review > HMP Glenochil – Replacement in Scotland since 2005. The 3rd of this programme and the delivery compressed air plant, associated generation contract for this Scottish confidence assessment of the external system improvements; service was awarded to GEOAmey review team was extremely positive, > HMP & YOI Grampian – Site boiler PECS Ltd on the 28 March 2018 indicating that, “Successful delivery of burner – dual fuel modulating units; and will come into operation on the the project/ programme to time, cost 26 January 2019. and quality appears highly likely and > HMP Perth – C hall lighting & controls there are no major outstanding issues replacement; While the contract is led and managed that at this stage appear to threaten > HMP Low Moss – Kitchen – Install gas by the SPS on a day-to-day basis, the delivery significantly.” fired boiling pans; service provided is Scotland-wide and supports Police Scotland, Scottish The new contract was awarded on > HMP & YOI Polmont – Monro and Courts and Tribunal Service and the time and in line with the project plan. Dunedin Hall – Lighting & controls Crown Office and Procurator Fiscal replacement; and The new contract will operate across Service. Together, all organisations Scotland for the next eight years with > HMP Dumfries – Phase 2 non work together to provide strategic the option to extend for a further accommodation areas lighting & oversight for this complex and vital four years. Work now continues, in controls replacement. service. conjunction with our partners, to ensure We are also in collaboration with Recognising the complexity of this a smooth transition from the 2nd to the Home Energy Scotland (HES) on a new contract, and the inherent risks new 3rd generation service provider. partnership aimed at helping SPS staff, associated with the retender and prisoners and their families to save continued delivery of a critical service, Sustainability energy, save money and stay warmer SPS constituted a formal programme SPS performance for 2017 has been during winter. Pilot presentation events structure (adhering to Prince2 very encouraging, with total carbon have been undertaken at three prisons, principles) to manage the process emissions down on our current baseline HMP Glenochil, HMP Edinburgh and HMP and provide assurance around and year 2015 by 12%. Castle Huntly. Home Energy Scotland, appropriately mitigate the associated funded by the Scottish Government, risks. Our total expenditure associated with Green House Gas emissions has provides free and impartial advice to January 2017 saw the formal start reduced by 13% when compared to our help people across Scotland reduce their of the retender process, which was current baseline year, 2015. energy bills and make their homes more run by the SPS as a distinct project affordable to heat. within our Operations Directorate. Our overall energy consumption has Each partner organisation was reduced this year by 4% when compared SPS have also completed a Sustainable strategically involved at all levels of to our current baseline year 2015. Transport Review in partnership with the procurement and were an integral Our energy consumption costs has The Energy Saving Trust regarding part of the wider project structure. reduced this year by 13% when compared options to decarbonise our own vehicle to our current baseline year 2015. fleet and to provide advice around The procurement strategy was vehicle types. comprehensive and the chosen Renewable electricity generation procurement route was the relatively from our installed Solar PV systems new Competitive Procedure with continues to increase year on year. To Negotiation. This proved to be a date SPS has produced over 1.2GWhrs sound choice and was supported by of electricity from Solar PV. collaborative work and communication Colin McConnell Energy saving projects successfully across all organisations involved in the Chief Executive delivered during 2017 include: process. > HMP Shotts – Solar PV phase 2, 27 June 2018 increasing capacity to 250kWp;

PERFORMANCE REPORT – ANALYSIS 35

ACCOUNTABILITY REPORT – CORPORATE GOVERNANCE

The purpose of this section is to explain the composition and organisation of SPS’ governance structures and how they support the achievement of our objectives.

ACCOUNTABILITY REPORT – CORPORATE GOVERNANCE SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

DIRECTORS’ REPORT

The Chief Executive establishes the strategic direction of SPS in conjunction with the Scottish Government; ensures public accountability; assures probity/integrity; allocates resources and monitors performance; reviews and manages risks facing the SPS; and develops capability and performance while ensuring sound corporate governance.

Appointment of the Chief Executive SPS operates a three directorate model; Information Security The Chief Executive was appointed Operations, Strategy and Innovation The SPS takes information security very by the Permanent Secretary of and Corporate Services. seriously. Information security is the the Scottish Government who is responsibility of the Senior Information empowered to make any changes to the In the financial year 2017-18, the Risk Owner at Board level and is appointment. The Permanent Secretary Advisory Board met six times. Minutes governed by an Information Governance appointed Colin McConnell as Chief of the SPS Advisory Board meetings Forum which meets every two months. Executive on 28 May 2012. are published on the SPS website www. sps.gov.uk/Corporate/Publications/ There is an Information Security Unit Board Members Publications.aspx. based in Headquarters and a network The Chief Executive chairs an internal of trained Information Security Officers Advisory Board which, in 2017-18, A Register of Interests of Advisory Board throughout the SPS. Each Information comprised of SPS Executive Directors members is held by SPS and is reviewed Security Officer holds regular meetings and four independent Non-Executive twice a year. The register is published on with their local management to discuss Directors (appointed by Scottish our website www.sps.gov.uk. information security and to prepare an Ministers for their expertise) who action plan for their area. The Risk Monitoring and Audit collectively act in an advisory capacity. Committee (RMAC), which is comprised The SPS Advisory Board’s role is Robust information security policies of two Non-Executive Directors and an to support the Chief Executive in are in place and staff are made aware independent chairperson, supports the providing leadership and in directing and of these policies through leaflets and Chief Executive and the Advisory Board controlling the organisation in the public presentations. All staff undertake a by advising on the effectiveness of SPS interest. compulsory Cabinet Office e-learning corporate governance arrangements course on protecting information. The Chief Executive establishes the including risk management, strategic direction of SPS in conjunction performance management, systems An internal process for reporting and with the Scottish Government; ensures of internal control and assurance investigating information security public accountability; assures probity/ arrangements. The Committee met on and personal data related incidents integrity; allocates resources and five occasions during 2017-18 and is is in place. During 2017-18, the SPS monitors performance; reviews and chaired by Gavin Scott. did not report any personal data manages risks facing the SPS; and related incidents to the Information develops capability and performance Commissioner. while ensuring sound corporate governance.

ACCOUNTABILITY REPORT – DIRECTORS’ REPORT 37

SPS Board March 2018 Back row, left to right: James Kerr, Gavin Scott, Teresa Medhurst, Ruth Sutherland, Gill Stillie, Eric Murch. Front row, left to right: Alex McMillan, Colin McConnell, Hugh Monro (Chair), Rob Molan, Kay Hampton.

This photograph captures the SPS Advisory Board as of March 2018. Other Directors and Non-Executive Directors have been in post for some of the reporting year and therefore appear elsewhere in the report.

ACCOUNTABILITY REPORT – DIRECTORS’ REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Appointed Auditors The accounts are audited by our auditors appointed by the Auditor General for Scotland. Under section 21 of the Public Finance and Accountability (Scotland) Act 2000, the Auditor General has determined that Scott Moncrieff will be the appointed auditor for SPS for the financial years 2016-17 to 2020-21. Scott Moncrieff carried out the audit of SPS’ accounts for the financial year ending 31 March 2018. Scott Moncrieff determined that the notional fee for this service was £103,190 (2016-17 £103,190).

ACCOUNTABILITY REPORT – DIRECTORS’ REPORT 39

STATEMENT OF ACCOUNTABLE OFFICER’S RESPONSIBILITIES

Under section 19(4) of the Public > make judgements and estimates on a Statement of the Disclosure of Finance and Accountability (Scotland) reasonable basis; Information to Auditors Act 2000 the Scottish Ministers have So far as the Accountable Officer is > state whether applicable accounting directed SPS to prepare a statement of standards as set out in the aware: accounts for each financial year in the Government Financial Reporting > there is no relevant audit information form and, on the basis, set out in the Manual have been followed, and of which SPS’ auditors are unaware; Accounts Direction on page 82. The disclose and explain any material > the Accountable Officer has taken all accounts are prepared on an accrual departures in the accounts; and basis and must give a true and fair view steps that he ought to have taken to of the SPS’ state of affairs at the year- > prepare the accounts on a going make himself aware of any relevant end and of its income and expenditure, concern basis. audit information, and to establish that changes in taxpayers’ equity and cash the agency’s auditors are aware of this The Principal Accountable Officer of flows for the financial year. information. the Scottish Government appointed In preparing the accounts, the the Chief Executive of the SPS as the Accountable Officer’s Confirmation Accountable Officer is required to Accountable Officer. As Accountable The Accountable Officer confirms: comply with the requirements of the Officer, the Chief Executive is > that the Annual Report and Accounts Government Financial Reporting Manual responsible to Scottish Ministers. The as a whole are fair, balanced and and in particular to: responsibilities of an Accountable Officer, including responsibility for the understandable; > observe the Accounts Direction issued propriety and regularity of the public > that he takes personal responsibility by Scottish Ministers, including the finances and for the keeping of proper for the annual report and accounts relevant accounting and disclosure records and for safeguarding SPS’ and the judgements required for requirements, and apply suitable assets, are set out in the Accountable determining that they are fair, accounting policies on a consistent Officer’s Memorandum issued by the balanced and understandable. basis; Scottish Government.

ACCOUNTABILITY REPORT – ACCOUNTABLE OFFICER’S RESPONSIBILITIES SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

GOVERNANCE STATEMENT

Scope of responsibilities The role of the Advisory Board is to > Risks in relation to managing the As Accountable Officer, I have undertake a supportive, advisory, increasingly complex needs of those responsibility for maintaining a sound questioning and enabling function. in our care whilst maintaining safe and system of internal control that supports It supports me as Chief Executive in secure custody. the achievement of the SPS policies, the discharge of my role by providing > Risks in relation to introducing smoke aims and objectives set by Scottish a robust, challenging forum to bring free prisons due to the complexity and Ministers whilst safeguarding the public issues to a knowledgeable group of dynamics of a prison environment. funds and departmental assets for Executive and Non-Executive Directors which I am personally responsible, in to help me reach defensible and well- > A high level overview of the Corporate accordance with the responsibilities informed decisions. Services Directorate risk register, assigned to me. focussing principally on potential The role of Advisory Board includes: employee relations risks. As Accountable Officer, I am > Strategy – constructively challenging > Risks in relation to the accountable to Scottish Ministers for and contributing to the development implementation of the Prison Officer the operation of the SPS; for advising of strategy, suggesting ambitious Professionalisation Programme them on policy on prisons; for the targets and innovative approaches for (POPP), a key programme of work management of SPS and for planning its delivery. for SPS and one which is included future development. within the Scottish Government’s > Performance – scrutinising the Programme for Government. Governance Framework performance of management The SPS is an Executive Agency of the in meeting goals and objectives The meetings were attended by me Scottish Government, and is required to and monitoring the reporting of as Chief Executive, relevant Executive comply with the Scottish Public Finance performance. and Non-Executive Directors and both Manual. The SPS Framework Document > Risk – satisfying themselves of internal and external auditors. (refreshed in March 2016 in line with best the reliability and integrity of risk practice guidance and in consultation management and internal control Risk and Control Framework with Scottish Government) sets out the arrangements. Providing assurance The SPS has adopted a risk policy and resources within which SPS that the framework for organisational management strategy which aligns with operates, including delegated financial governance is operating effectively. the transformational vision, mission and limits. The Framework Document can be values of SPS, whilst also supporting the found on SPS’ website at the following The Advisory Board is supported in its operational delivery of its core business link www.sps.gov.uk/Corporate/ work by the RMAC, which is currently and contributing to the wider Strategy Publications/Publication-3925.aspx chaired by an independent member for Justice in Scotland set out by the Scottish Government. As Chief Executive, in the course of the Committee. The RMAC is of 2017-18, I was supported by an responsible for overseeing risk, control The risk management strategy Advisory Board, comprising of Non- and governance arrangements in of the SPS sets the requirements Executive Directors and internal place throughout SPS, and considers of compliance with principles and Executive Directors. During the year, the SPS exposure to financial risks approaches to risk management that Advisory Board met on six occasions including fraud and corruption as well are to be executed by relevant parties. and was chaired by a Non-Executive as operational risk and its capacity In addition, all risks are mapped against Director. to respond. The RMAC met on five the four Strategic Themes contained occasions during 2017-18 (two of which within the Corporate Plan 2017-20, were inquorate) and as part of its core namely Professionalism, Partnership, business, undertook an in-depth review Purpose and Governance. of the following corporate risks/risk themes: The main objective of this strategy > Risk in relation to the ability of IT to is to ensure a unified and effective support the current and future needs organisational mechanism of risk of the organisation due to potential management within the SPS. shortcomings in infrastructure, capability, investment or strategy.

ACCOUNTABILITY REPORT – GOVERNANCE STATEMENT 41

The SPS risk management strategy Review of Effectiveness > Whilst the General Data Protection adopts best practice where appropriate As Accountable Officer, I have Regulations (GDPR) come into force in in the identification, evaluation and responsibility for reviewing the May 2018, changes to SPS information control of risks to ensure that they effectiveness of the systems of internal management were necessary during are eliminated or reduced to an control and corporate governance. My 2017-18 to ensure SPS meets GDPR acceptable level. The risk management review is informed by: requirements. The Senior Information strategy also allows the SPS to exploit Risk Owner is a member of the > In the course of the financial year, opportunities and where appropriate, internal audit reviews identified 29 EMG and is monitoring SPS GDPR take managed and understood risks to areas of limited assurance out of the compliance to ensure that any gaps better achieve its objectives. 133 studies undertaken. Areas of are identified and resolved. SPS considers risk management as limited assurance related to financial > Annual report to the SPS Advisory a critical component of effective controls at four establishments (16 Board from the Chairman of the RMAC business management and utilises risk areas of limited assurance) and no concerning corporate governance and management techniques to better assurance was awarded on three the control environment. occasions (two instances of software inform decision making. The review > Attendance of the Chairman of the of risk is an integral part of monthly licensing issues and one relating to RMAC (as an observer) at Advisory reporting cycles and the Executive significant overcharge in respect of Board meetings. Management Group (EMG) meets to a major SPS national contract, which > Regular reports from internal formally consider risk on a quarterly are outlined within the Significant Issues section of this Governance assurance providers (Head of Health basis. At these quarterly risk reviews, & Safety, Head of Fire Safety and the EMG reviews the appropriateness of Statement). Action plans have been developed for each of these areas and Divisional Head of Operational the risks contained within the register, Support) on the adequacy and challenges and interrogates the progress will be followed up by internal audit in early 2018-19. effectiveness of the system of controls and mitigations and scrutinises internal control, together with the evolving risk landscape to identify > Executive managers who have recommendations for improvements new and emerging risks. responsibility for the development and and the action management maintenance of the internal control proposes taking to implement these I am content with the effectiveness framework. of the overall SPS risk management recommendations. > Meetings of the SPS Advisory Board strategy and there are no significant > External Audit who report to the RMAC risks (other than those disclosed in within the financial year. on SPS controls through management the overall performance section of the > Meetings of the Executive letters and other reports. report) which I, as Accountable Officer Management Group to deal with > Progression of management action consider necessary to disclose here. operational and other issues. from internal and external audit The Purpose of the System of Internal > Monitoring and reporting of reports. performance against key performance Control > Regular reviews of progress on the The system of internal control indicators. Annual Delivery Plan by the Advisory is designed to manage risk to an > Twice yearly Statements of Assurance Board. acceptable level rather than eliminate from every Executive Director, > Implementing measures for SPS all risk of failure to achieve policies, aims covering the key business areas to ensure information security and objectives. It can therefore only for which they are responsible. The and standardise and enhance the provide reasonable and not absolute contents of these Statements of management of information risk. In assurance of effectiveness. The system Assurance focus on the management the course of 2017-18, the Director of internal control has been in place in of key risks and identification of of Operations was the organisation’s the SPS for the year ended 31 March emerging issues which could impact on Senior Information Risk Owner 2018 and up to the date of the approval the systems of internal control. These (SIRO) and chaired the Information of the Annual Report and Accounts Statements of Assurance are reviewed Governance Forum which met seven and accords with Scottish Government by the Head of Audit and Assurance times during 2017-18. guidance. and myself and the effectiveness of this process is reported to the RMAC.

ACCOUNTABILITY REPORT – GOVERNANCE STATEMENT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

> The Change Portfolio Board, which As part of our ongoing work and as part Software Licensing: During 2017-18, met six times during 2017-18 to of the assurance process, we continue SPS was in dispute with two software review interrelated projects and to identify areas for improvement in providers in relation to software programmes which fall within the SPS our governance and internal controls license use. Negotiated settlements portfolio of change activities and who framework. I am content that my review, were reached with both companies report regularly to the SPS Executive informed by all of the items detailed which included new licences, future Group and SPS Advisory Board. above, provides overall substantial maintenance and annual support fees > The use of Project Management and assurance of the effectiveness of the at a cost of approximately £800,000. gateway review processes to manage systems of governance and internal Revised arrangements are now in place major projects and a review of key control within the SPS. to ensure that all installed software is projects by Internal Audit. appropriately licensed. Significant Issues > The Fraud Response Group (FRG), There have been significant issues which focuses on fraudulent activity identified during the year in relation to within the organisation at an early the overall governance framework and stage, reviews the lessons learned, these were: Colin McConnell promotes awareness of fraudulent Chief Executive activity and influences policy Equal Pay Litigation: During 2017-18, development. The FRG met on two SPS was subject to Equal Pay litigation 27 June 2018 occasions during the financial year and which was instigated by members of will deliver its annual report to the May the PCS Union. On 28 March 2018, I 2018 meeting of the RMAC. announced my decision to settle the equal pay claims to enable SPS to focus > The establishment of a Corruption/ all of its energy on moving the Service Integrity Response Group within forward in partnership. SPS to provide assurance that all allegations of corruption are National Painting Contract: In the considered and where appropriate, course of routine audit work, it was investigated. The Group met six times established that there had been in 2017-18. significant overcharge by the National > The SPS Financial Policy and Guidance Painting Contractor. I commissioned a Manual provides standard authority joint exercise between my Internal Audit for establishments, SPS College, team and SPS external auditors (Scott- Central Stores and Headquarters Moncrieff) to establish the extent of Directorates. Compliance with its the overcharge on the contract and this contents is mandatory and maintains proved to be a lengthy exercise. From propriety in the control of Government this work, it was ascertained that a expenditure and income. It ensures significant overcharge has been made. assets are properly safeguarded, Part of the issue related to the control that proper accounting records are and policy compliance failures which maintained and ensures compliance allowed an overcharge to occur. There with current legislation and are lessons to be learned from these Government financial procedures. reviews covering procurement, contract monitoring and invoice payment review > In the year 2017-18, the Head of and authorisation process which Audit & Assurance offered an overall require improvement. The estimate of reasonable level of assurance based overcharging along with legal advice is on his review of the corporate informing the next steps that SPS will governance and control environment, take. management of risk and reliance placed on the work of other external assurance providers.

ACCOUNTABILITY REPORT – GOVERNANCE STATEMENT 43

ACCOUNTABILITY REPORT – REMUNERATION AND STAFF REPORT

The purpose of this section is to provide information on the remuneration and pension arrangements of SPS’ Advisory Board members. It also provides information on staff numbers and related costs for the year.

ACCOUNTABILITY REPORT – REMUNERATION AND STAFF REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

REMUNERATION REPORT

The remuneration of senior civil servants is set in accordance with the Civil Service Management Code available at www.civilservice.gov.uk and with independent advice from the Senior Salaries Review Body (SSRB).

Service Contracts Remuneration Policy The Review Body takes account of The Constitutional Reform and The remuneration of senior civil the evidence it receives about wider Governance Act 2010 requires Civil servants is set in accordance with economic considerations and the Service appointments to be made the Civil Service Management Code affordability of its recommendations. on merit on the basis of fair and available at www.civilservice.gov.uk open competition. The Recruitment and with independent advice from the Further information about the work Principles published by the Civil Service Senior Salaries Review Body (SSRB). of the Review Body can be found at Commission specify the circumstances www.ome.uk.com. when appointments may be made In reaching its recommendations, the The remuneration of the Executive otherwise. Review Body has regard to the following considerations: Board members is determined under Unless otherwise stated below, the Civil Service Management Code. > the need to recruit, retain and The remuneration of Non-Executive the officials covered by this report motivate suitably able and qualified hold appointments which are open- Board members is agreed with them on people to exercise their different appointment. ended. Early termination, other than responsibilities; for misconduct, would result in the Remuneration (including salary) and individual receiving compensation as set > regional/local variations in labour pension entitlements out in the Civil Service Compensation markets and their effects on the The following sections provide details of Scheme. recruitment and retention of staff; the remuneration and pension interests > Government policies for improving of the SPS Board Members. Further information about the work of the the public services including the Civil Service Commission can be found at requirement on departments to meet www.civilservicecommission.org.uk the output targets for the delivery of departmental services; > the funds available to departments as set out in the Government’s departmental expenditure limits; and > the Government’s inflation target.

ACCOUNTABILITY REPORT – REMUNERATION REPORT 45

Remuneration (salary and pensions) Single total figure of remuneration

Benefits in kind Pension benefits to Salary £000 (to nearest £100) nearest £0006 Total to nearest £000

2017-18 2016-17 2017-18 2016-17 2017-18 2016-17 2017-18 2016-17 C McCONNELL 115-120 110-115 - - 2 25 115-120 135-140 Chief Executive E MURCH 80-85 80-85 - - 3 18 85-90 100-105 Director of Corporate Change C TOPLEY7 60-65 (80-85 Full Year 80-85 - - 25 33 85-90 115-120 Director of Corporate Services Equivalent) JANICE BARCLAY8 15-20 (75-80 Full Year - - - 2 - 15-20 - Interim Director of Corporate Services Equivalent) RUTH SUTHERLAND9 0-5 (60-65 Full Year - - - 4 - 5-10 - Interim Director of Corporate Services Equivalent) F MUNRO10 0-5 Interim Director of Operational (80-85 Full Year 80-85 - - 1 49 0-5 130-135 Support Services Equivalent) T MEDHURST 80-85 80-85 - - 4 26 85-90 105-110 Director of Strategy & Innovation M STONEY11 65-70 Interim Director of Operational - (80-85 Full Year - - - 25 - 90-95 Delivery Equivalent) J KERR12 10-15 80-85 (80-85 Full Year - - 26 8 105-110 20-25 Director of Operations Equivalent) Z VAN ZWANENBERG13 0-5 5-10 - - - - 0-5 5-10 Non-Exec Director S BROWELL14 5-10 5-10 - - - - 5-10 5-10 Non-Exec Director H MONRO 0-5 5-10 - - - - 0-5 5-10 Non-Exec Director A McMILLAN15 5-10 5-10 - - - - 5-10 5-10 Non-Exec Director R MOLAN16 0-5 - - - - - 0-5 - Non-Exec Director K HAMPTON17 0-5 - - - - - 0-5 - Non-Exec Director GC STILLIE18 0-5 - - - - - 0-5 - Non-Exec Director

6. The value of pension benefits accrued during the year is calculated as (the real increase in pension multiplied by 20) plus (the real increase in any lump sum) less (the contributions made by the individual). The real increase excludes increases due to inflation or any increase or decrease due to a transfer of pension rights. 7. C Topley outward secondment from 8 January 2018. 8. J Barclay Interim Director of Corporate Services from 8 January 2018 – 31 March 2018. 9. R Sutherland Interim Director of Corporate Services from 5 March 2018. 10. F Munro Interim Director of Operational Support Services from 15 June 2015 to 9 April 2017. 11. M Stoney Interim Director of Operational Delivery until 29 January 2017. 12. J Kerr Director of Operational Delivery from 23 January 2017. 13. Z Van Zwanenberg Non-Executive Director until 30 November 2017. 14. S Browell Non-Executive Director until 31 January 2018. 15. A McMillan Non-Executive Director until 25 March 2018. 16. R Molan Non-Executive Director from 22 November 2017. 17. K Hampton Non-Executive Director from 22 November 2017. 18. GC Stillie Non-Executive Director from 22 November 2017.

ACCOUNTABILITY REPORT – REMUNERATION REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Salary Pay multiples In 2017-18, no employees received ‘Salary’ includes gross salary; overtime; Reporting bodies are required to remuneration in excess of the recruitment and retention allowances; disclose the relationship between highest-paid director (2016-17, none). and any other allowance to the extent the remuneration of the highest- Remuneration ranged from £14,523 that it is subject to UK taxation. This paid director in their organisation to banded remuneration of £115,000- report is based on accrued payments and the median remuneration of the £120,000 (full time equivalents) (2016- made by the SPS and thus recorded in organisation’s workforce. 17, £13,480 to banded remuneration these accounts. of £110,000-£115,000 (full time The banded remuneration of the equivalents)). Benefits in kind highest-paid director in SPS in the The monetary value of benefits in kind financial year 2017-18 was £115,000- Total remuneration includes salary, non- covers any benefits provided by the £120,000 (2016-17, £110,000-115,000). consolidated performance-related pay employer and treated by HM Revenue This was four times (2016-17, four) the and benefits-in-kind. It does not include and Customs as a taxable emolument. median remuneration of the workforce, severance payments, employer pension There were no benefits in kind paid which was £29,472 (2016-17, £29,180). contributions and the cash equivalent during the year (2016-17: nil). transfer value of pensions.

Bonuses Bonuses are based on performance levels attained and are made as part of the appraisal process. Bonuses relate to the performance in the year in which they become payable to the individual. There were no bonuses paid during the year (2016-17: nil).

ACCOUNTABILITY REPORT – REMUNERATION REPORT 47

Pension Benefits Accrued pension at Real increase in pension age as at pension and 31/3/2018 and related lump sum CETV at CETV at Real increase related lump sum at pension age 31/3/18 31/3/17 in CETV Officials £000 £000 £000 £000 £000

C McCONNELL 50-55 0-2.5 Chief Executive plus lump sum of plus lump sum of 1,130 1,059 2 150-155 0-2.5

E MURCH 30-35 0-2.5 Director of Corporate Change plus lump sum of plus lump sum of 772 720 3 95-100 0-2.5

C TOPLEY 10-15 0-2.5 127 115 7 Director of Corporate Services

J BARCLAY 40-45 0-2.5 549 530 0 Interim Director of Corporate Services

R SUTHERLAND 20-25 0-2.5 Interim Director of Corporate Services plus lump sum of plus lump sum of 533 528 4 70-75 0-2.5

F MUNRO 25-30 0-2.5 Interim Director of Operational plus lump sum of plus lump sum of 568 567 1 Support Services 85-90 0-2.5

T MEDHURST 30-35 0-2.5 Director of Strategy & Innovation plus lump sum of plus lump sum of 710 658 2 100-105 0-2.5

M STONEY - - - 468 - Interim Director of Operational Delivery

J KERR 30-35 Director of Operational Delivery plus lump sum of 0-2.5 593 542 13 80-85

Z VAN ZWANENBERG No Pension Entitlement Non-Exec Director

S BROWELL No Pension Entitlement Non-Exec Director

H MONRO No Pension Entitlement Non-Exec Director

A McMILLAN No Pension Entitlement Non-Exec Director

R MOLAN No Pension Entitlement Non-Exec Director

K HAMPTON No Pension Entitlement Non-Exec Director

GC STILLIE No Pension Entitlement Non-Exec Director

ACCOUNTABILITY REPORT – REMUNERATION REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Civil Service pensions show pension earned in PCSPS or alpha The partnership pension account is a Pension benefits are provided through – as appropriate. Where the official has stakeholder pension arrangement. The the Civil Service pension arrangements. benefits in both the PCSPS andalpha employer makes a basic contribution From 1 April 2015 a new pension scheme the figure quoted is the combined value of between 8% and 14.75% (depending for civil servants was introduced – the of their benefits in the two schemes.) on the age of the member) into a Civil Servants and Others Pension Members joining from October 2002 stakeholder pension product chosen Scheme or alpha, which provides may opt for either the appropriate by the employee from a panel of benefits on a career average basis defined benefit arrangement or providers. The employee does not with a normal pension age equal to a ‘money purchase’ stakeholder have to contribute, but where they the member’s State Pension Age (or pension with an employer contribution do make contributions, the employer 65 if higher). From that date all newly (partnership pension account). will match these up to a limit of 3% appointed civil servants and the majority of pensionable salary (in addition to of those already in service joined Employee contributions are salary- the employer’s basic contribution). alpha. Prior to that date, civil servants related and range between 4.6% Employers also contribute a further participated in the Principal Civil Service and 8.05% for members of classic, 0.5% of pensionable salary to cover the Pension Scheme (PCSPS). The PCSPS premium, classic plus, nuvos and alpha. cost of centrally-provided risk benefit has four sections: 3 providing benefits on Benefits inclassic accrue at the rate of cover (death in service and ill health a final salary basis classic( , premium or 1/80th of final pensionable earnings for retirement). classic plus) with a normal pension age each year of service. In addition, a lump of 60; and one providing benefits on a sum equivalent to three years initial The accrued pension quoted is the whole career basis (nuvos) with a normal pension is payable on retirement. For pension the member is entitled to pension age of 65. premium, benefits accrue at the rate receive when they reach pension age, of 1/60th of final pensionable earnings or immediately on ceasing to be an These statutory arrangements are for each year of service. Unlike classic, active member of the scheme if they unfunded with the cost of benefits met there is no automatic lump sum. classic are already at or over pension age. by monies voted by Parliament each plus is essentially a hybrid with benefits Pension age is 60 for members of year. Pensions payable under classic, for service before 1 October 2002 classic, premium and classic plus, 65 premium, classic plus, nuvos and calculated broadly as per classic and for members of nuvos, and the higher of alpha are increased annually in line with benefits for service from October 2002 65 or State Pension Age for members of Pensions Increase legislation. Existing worked out as in premium. In nuvos a alpha. (The pension figures quoted for members of the PCSPS who were within member builds up a pension based on officials show pension earned in PCSPS 10 years of their normal pension age his pensionable earnings during their or alpha – as appropriate. Where the on 1 April 2012 remained in the PCSPS period of scheme membership. At the official has benefits in both the PCSPS after 1 April 2015. Those who were end of the scheme year (31 March) the and alpha the figure quoted is the between 10 years and 13 years and 5 member’s earned pension account is combined value of their benefits in the months from their normal pension age credited with 2.3% of their pensionable two schemes, but note that part of that on 1 April 2012 will switch into alpha earnings in that scheme year and the pension may be payable from different sometime between 1 June 2015 and 1 accrued pension is uprated in line with ages.) February 2022. All members who switch Pensions Increase legislation. Benefits to alpha have their PCSPS benefits in alpha build up in a similar way to Further details about the Civil Service ‘banked’, with those with earlier benefits nuvos, except that the accrual rate in pension arrangements can be found in one of the final salary sections of the 2.32%. In all cases members may opt to at the website PCSPS having those benefits based on give up (commute) pension for a lump www.civilservicepensionscheme.org.uk their final salary when they leavealpha . sum up to the limits set by the Finance (The pension figures quoted for officials Act 2004.

ACCOUNTABILITY REPORT – REMUNERATION REPORT 49

The Cash Equivalent Transfer Value has accrued as a consequence of from Lifetime Allowance Tax which may (CETV) their total membership of the pension be due when pension benefits are taken. A Cash Equivalent Transfer Value (CETV) scheme, not just their service in a senior is the actuarially assessed capitalised capacity to which disclosure applies. Real increase in CETV value of the pension scheme benefits This reflects the increase in CETV that accrued by a member at a particular The figures include the value of any is funded by the employer. It does not point in time. The benefits valued pension benefit in another scheme or include the increase in accrued pension are the member’s accrued benefits arrangement which the member has due to inflation, contributions paid by and any contingent spouse’s pension transferred to the Civil Service pension the employee (including the value of payable from the scheme. A CETV is a arrangements. They also include any any benefits transferred from another payment made by a pension scheme additional pension benefit accrued to pension scheme or arrangement) and or arrangement to secure pension the member as a result of their buying uses common market valuation factors benefits in another pension scheme or additional pension benefits at their for the start and end of the period. arrangement when the member leaves own cost. CETVs are worked out in Compensation for loss of office a scheme and chooses to transfer accordance with The Occupational There were no SPS Board members the benefits accrued in their former Pension Schemes (Transfer Values) that left on Voluntary Exit, Voluntary scheme. The pension figures shown (Amendment) Regulations 2008 and Redundancy or Compulsory relate to the benefits that the individual do not take account of any actual or potential reduction to benefits resulting Redundancy terms.

ACCOUNTABILITY REPORT – REMUNERATION REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

STAFF REPORT

As at 31 March 2018 there were 4,549 staff in post including four Non-Executive Directors. The split across grade and gender is detailed in the table below.

2017-18 2016-17 Male Female Total Male Female Total Senior Civil Servants 3 1 4 3 2 5 Directors 0 2 2 1 0 1 Non-Executive Directors 2 2 4 2 2 4 Employees 3,170 1,369 4,539 3,232 1,326 4,558 Total 3,175 1,374 4,549 3,238 1,330 4,568 SPS has a female Senior Civil Servant inwardly seconded to SPS and a female Senior Civil Servant outwardly seconded to Scottish Police Authority. These individuals have been included within the Average Number of Persons Employed table on page 52, but do not show in the table above.

Staff Numbers and Related Costs The following sections have been subject to audit by SPS’ auditors. The table below shows the staff costs for the year ended 31 March 2018 along with the prior year comparisons.

2017-18 2017-18 2017-18 2016-17 Permanently employed staff Others Total Total Staff Costs £000 £000 £000 £000 Wages and salaries 130,035 1,623 131,658 130,184 Social security costs 12,904 20 12,924 12,787 Other pension costs 26,076 42 26,118 26,164 Sub Total 169,015 1,685 170,700 169,135 less recoveries in respect of outward secondments (263) 0 (263) (251) Total net costs 168,752 1,685 170,437 168,884

Permanently employed staff includes staff employed on fixed term contracts. Others includes costs associated with agency staff and inward secondees.

ACCOUNTABILITY REPORT – STAFF REPORT 51

Included in the Wages and salaries For 2017-18, employers’ contributions Employers also match employee figure is an entry of £3,661k which of £25,943k were payable to the PCSPS contributions up to 3% of pensionable relates to payment of £1,000 to (2016-17 £26,062K) at one of four rates in earnings. In addition, employer operational staff in pay ranges C, D the range 20.0% to 24.5% of pensionable contributions of £5.2k, 0.5% of and E. These payments were made to earnings, based on salary bands. pensionable pay, were payable to the Prison Officers and Operational First PCSPS to cover the cost of the future Line Managers in recognition of their The Scheme Actuary reviews employer provision of lump sum benefits on death continued engagement to deliver contributions usually every four years in service or ill health retirement of the future operating model for SPS. following a full scheme valuation. The these employees. These payments attracted Employers’ contribution rates are set to meet the National Insurance contributions. cost of the benefits accruing during Contributions due to the partnership 2017-18 to be paid when the member pension providers at the balance sheet The PCSPS and the Civil Servant and retires and not the benefits paid during date were nil. Contributions prepaid at Other Pension Scheme (CSOPS) – this period to existing pensioners. that date were nil. known as “Alpha” – are unfunded multi- employer defined benefit schemes but Employees can opt to open a During the reporting year 15 individuals SPS is unable to identify its share of the partnership pension account, a (2016-17; 11 persons) retired early on underlying assets and liabilities stakeholder pension with an employer ill-health grounds; the total additional contribution. Employers’ contributions accrued pension liabilities in the year The scheme actuary valued the PCSPS of £163k were paid to one or more amounted to £34k (2016-17 £25k). as at 31 March 2012. You can find details of the panel of three appointed in the resource accounts of the Cabinet stakeholder pension providers. Employer Office: Civil Superannuationhttps:// contributions are age-related and ranged www.civilservicepensionscheme.org. from 8% to 14.75%. uk/about-us/resource-accounts/

ACCOUNTABILITY REPORT – STAFF REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Average Number of Persons Employed The average number of whole-time equivalent persons employed during the year was as follows.

Persons employed 2017-18 2016-17 Directly employed 4,323 4,360 Other 7 6 Total 4,330 4,366

Directly employed includes non-permanent staff.

Reporting of Civil Service and other compensation schemes – exit packages Number of compulsory Number of other Total number of exit Exit package cost band redundancies departures agreed packages by cost band <£10,000 - 3 (3) 3 (3) £10,000 – £25,000 - 1 (5) 1 (5) £25,000 – £50,000 - 6 (1) 6 (1) £50,000 – £100,000 - 3 (4) 3 (4) Total number of exit packages - 13 (13) 13 (13) £434,822 £434,822 Total resource cost/£ - (377,643) (377,643)

Comparative data is shown (in brackets) for previous year. These figures differ from those disclosed in the 2016-17 accounts as they include amendments to payments that have been made following the quashing at Judicial Review of the 2016 amendments to the Civil Service Compensation Scheme.

Redundancy and other departure The above table includes exit costs Attendance and Wellbeing costs have been paid in accordance relating to Voluntary Exit Schemes (VES) SPS has continued to promote with the provisions of the Civil Service approved by Cabinet Office and capability employee wellbeing through various Compensation Scheme, a statutory schemes approved by SPS. During 2017- initiatives, including its Employee scheme made under the Superannuation 18 there were no VES exits (2016-17, Assistance Programme (EAP), Critical Act 1972. Exit costs are accounted for in no exits) and 13 exits under capability Incident Response & Support (CIRS) full in the year the decision of departure schemes at a cost of £435k (2016-17, 13 process, Healthy Working Lives Awards, is agreed. Where the agency has agreed exits at a total cost of £378k). Occupational Health (OH) provision and early retirements, the additional costs a new OH provider was appointed in are met by the agency and not by the April 2017. Civil Service pension scheme. Ill-health retirement costs are met by the pension The Healthy Working Lives Award scheme and are not included in the table. programme supports employers and employees to develop health promotion and safety themes in the workplace. The table below shows the results of wellbeing initiatives undertaken in 2017-18:

ACCOUNTABILITY REPORT – STAFF REPORT 53

SPS has continued to listen to our Healthy Working Lives Award staff and to identify ways in which we Award Level Establishments can further improve our employee engagement and sense of loyalty and Gold Award Achieved 7 pride in working for the service. In Silver Award Achieved 4 2017 and early 2018 we conducted a Bronze Award Achieved or working 3 series of staff focus groups to seek towards the award views on two key areas, Long Service and remembering ex colleagues. The The Average Working Days Lost (AWDL) outcomes of the focus groups are to sickness absence per employee is currently being evaluated, and revised detailed in the table below: procedures will be introduced during 2018. These events also foster loyalty Average Working Days Lost to Sickness Absence and a sense of belonging for existing staff. 2017 - 2018 14.2 2016 - 2017 11.8 Employment Relations & Reward Increase of 2.4 In line with the People Strategy, a further eight HR policies have been reviewed In response to this increase a range of Employee Engagement Levels in partnership with our Trade Union work is already underway to maximise Employee engagement levels for staff partners. Both the Code of Conduct attendance. Attempting to reduce the are measured through an independent and Performance Improvement Policy, level of absence will be a key priority for annual survey and benchmarked against which were both revised in 2017-18, will the organisation in 2018-19. other areas of the Civil Service. The 2017 be instrumental in enabling managers results were slightly higher than the to maintain high levels of performance, Mental ill health accounted for 11% previous year and were broadly similar to conduct and behaviour across the SPS. of short term and 37% of long term the civil service average. Improvements absence at SPS in 2017-18 (10% were achieved in areas including SPS was pleased to announce the change and 33% respectively in 2016-17). ‘Leadership & Managing Change’, in its annual pay award date to 1 April, Throughout 2017-18 SPS has been ‘My Manager’ and ‘Inclusion & Fair previously 1 October, benefitting staff in working in partnership with TUS Treatment,’ with 88% of respondents 2018 through an earlier pay settlement colleagues to develop an Employee stating that they have the skills to do date. From 1 April 2018, contractual paid Wellbeing Policy and has been working their job and 82% saying that they are maternity leave and adoption leave will with Healthy Working Lives to explore interested in their work. The SPS People increase from 23 weeks to 24, and will additional support options for employees Survey Advisory Group met three times then increase again by 1 week in both experiencing mental ill health. We have in 2017 in order to champion and monitor April 2019 and April 2020, subject to also taken steps to raise employee employee activities throughout the SPS compliance with Public Sector Pay Policy awareness of the EAP, which offers a free estate. ‘Our 5’ action plans, resulting in future years. SPS has also confirmed confidential 24 hour service providing from the key themes of the People that it will implement a revised annual specialist support and information for Survey, continue to create positive leave process from 1 April 2018 which will employees and their immediate family on actions to grow engagement and drive take account of overtime, ex gratia and health and personal matters. cultural and behavioural change. The on-call allowance payments. ‘Our 5’ Action Plans are embedded in local business planning throughout the service. Supporting this work has been the development of a SharePoint site enabling the exchange of good practice across the SPS estate.

ACCOUNTABILITY REPORT – STAFF REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Equality and Diversity As an Equal Opportunities employer the Trade Union Regulations In April 2017 SPS agreed and published SPS actively encourages applications The Trade Union (Facility Time the SPS Employment Equality from people with disabilities, the SPS Publication Requirements) Regulations Monitoring Report 2015-2016, the previously engaged in the Guaranteed 2017 came into force on 1 April 2017. SPS Equal Pay, Gender Pay Gap and Interview Scheme for disabled people The regulations place a legislative Occupational Segregation Report but now have advanced our support requirement on relevant public sector 2017, the SPS Equality Mainstreaming for disabled applicants by positively employers to collate and publish, on Progress Report 2015-2017, the SPS committing to the Scottish Government an annual basis, a range of data on Equality Outcomes Progress Report Disability Confident Scheme. Reviewing the amount and cost of facility time 2015-2017 and the new SPS Equality our applications to be inclusive and within their organisation. The data is Outcomes 2017-2020. The Equality accessible, offering interviews to required to be published on a website Outcomes embed our refreshed disabled people who meet the eligibility maintained by or on behalf of the commitment, vision and principles criteria and providing reasonable employer before 31st July each year. under equality, diversity and human adjustments. In 2017-2018, 129 We intend to publish this data at the rights which are fundamental to the way candidates with a disability applied to following link: www.sps.gov.uk. we work. SPS via Guaranteed Interview Scheme, of which 16 progressed to the later Requirements for the data to be Delivering our new Equality Outcomes is stages of the recruitment process. disclosed within the annual report and explicitly identified in our Corporate Plan accounts was unclear at the time of 2017-2020 as action we will take under The SPS are involved in the Scottish issue. The Cabinet Office published the Strategic theme ‘Governance’. This Government Disability Confident supporting guidance on 2 June 2018 will ensure it is reflected in all corporate scheme which recognises the which has clarified the data should be planning and we will monitor Directorate talent, disabled people can bring to disclosed. Due to the timing of this and business areas’ progress via the workplace. As a result, the SPS confirmation, we were unable to collate the quarterly and annual corporate is currently Disability Confident reliable data to publish within the reporting processes. These reports Committed (Level 1) and over the next 2017‑18 annual report and accounts are submitted to the SPS Executive year intends progressing to Disability therefore we will publish from 2018-19 Management Group and also to the SPS Confident Employer level 2 which means onwards. Equality & Diversity Steering Group for we would be recognised as going the scrutiny. A number of key HR policies, extra mile to make sure disabled people The following sections of the including Dignity at Work, Grievance and get a fair chance. SPS also monitors Remuneration and Staff Report are Recruitment and Selection were revised opportunities for individuals who subject to audit opinion: in 2017-18 to support progress against become disabled during employment. In > Single total figure of remuneration for the equality outcomes. 2018, the SPS will continue to advance each director; our support to people with a disability > CETV disclosures for each director; by engaging in the National Disability > Payments to past directors; Internship Programme. > Compensation for loss of office; > Pay multiples; > Exit packages; > Analysis of staff costs and numbers.

ACCOUNTABILITY REPORT – STAFF REPORT 55

ACCOUNTABILITY REPORT – PARLIAMENTARY ACCOUNTABILITY AND AUDIT REPORT

The purpose of this section is to provide details of any losses incurred by SPS during the year. It also contains the Independent Auditor’s report.

ACCOUNTABILITY REPORT – PARLIAMENTARY ACCOUNTABILITY AND AUDIT REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

PARLIAMENTARY ACCOUNTABILITY REPORT

Losses and Special Payments The following losses and special payments have been included in the accounts and have been audited by SPS’ auditors:

2017-18 2016-17 Cases £000 Cases £000 Losses Statement Cash losses 129 10 185 10 Losses of accountable stores 338 40 292 35 Fruitless payments 67 12 9 439 Total 534 62 486 484 Special Payments Special payments 283 3,670 271 1,534

Other Notes Included in special payments is the settlement amount in respect of the equal pay claims raised by non-operational colleagues following the decision to make operational payments to Prison Officers and First Line Managers in recognition of their continuing engagement in a review of their roles (£2,449k).

Colin McConnell Chief Executive

27 June 2018

ACCOUNTABILITY REPORT – PARLIAMENTARY ACCOUNTABILITY 57

INDEPENDENT AUDITOR’S REPORT

Independent auditor’s report to > have been properly prepared in Auditor’s responsibilities for the audit Scottish Prison Service, the Auditor accordance with IFRSs as adopted by of the financial statements General for Scotland and the Scottish the European Union, as interpreted Our responsibility is to audit and Parliament and adapted by the 2017/18 FReM; express an opinion on the financial and statements in accordance with This report is made solely to the > have been prepared in accordance applicable legal requirements and parties to whom it is addressed in with the requirements of the Public ISAs (UK&I) as required by the Code accordance with the Public Finance and Finance and Accountability (Scotland) of Audit Practice approved by the Accountability (Scotland) Act 2000 and Act 2000 and directions made Auditor General for Scotland. Those for no other purpose. In accordance thereunder by the Scottish Ministers. standards require us to comply with with paragraph 120 of the Code of the Financial Reporting Council’s Audit Practice approved by the Auditor Basis of opinion Ethical Standards for Auditors. An audit General for Scotland, We do not We conducted our audit in accordance involves obtaining evidence about undertake to have responsibilities to with applicable law and International the amounts and disclosures in the members or officers, in their individual Standards on Auditing in the UK financial statements sufficient to give capacities, or to third parties. and Ireland (ISAs (UK&I)). Our reasonable assurance that the financial responsibilities under those standards statements are free from material Report on the audit of the financial are further described in the Auditor’s misstatement, whether caused statements Responsibilities for the Audit of the by fraud or error. This includes an Opinion on financial statements Financial Statements section of our assessment of: whether the accounting We have audited the financial report. We are independent of the policies are appropriate to the statements in the annual report and body in accordance with the ethical body’s circumstances and have been accounts of the Scottish Prison Service requirements that are relevant to our consistently applied and adequately for the year ended 31 March 2018 under audit of the financial statements in the disclosed; the reasonableness of the Public Finance and Accountability UK including the Financial Reporting significant accounting estimates made (Scotland) Act 2000. The financial Council’s Ethical Standards for by the Accountable Officer; and the statements comprise the Statement Auditors, and we have fulfilled our other overall presentation of the financial of Comprehensive Net Expenditure, ethical responsibilities in accordance statements. the Statement of Financial Position, the with these requirements. We believe Statement of Cash Flow, the Statement that the audit evidence we have Our objectives are to achieve of Changes in Taxpayers’ Equity, and obtained is sufficient and appropriate reasonable assurance about whether notes to the accounts, including a to provide a basis for our opinion. the financial statements as a whole summary of significant accounting are free from material misstatement, policies. The financial reporting Responsibilities of the Accountable whether due to fraud or error, and to framework that has been applied in Officer for the financial statements issue an auditor’s report that includes their preparation is applicable law As explained more fully in the our opinion. Reasonable assurance is and International Financial Reporting Statement of the Accountable Officer a high level of assurance, but is not a Standards (IFRSs) as adopted by the Responsibilities, the Accountable guarantee that an audit conducted in European Union, and as interpreted and Officer is responsible for the accordance with ISAs (UK&I) will always adapted by the 2017/18 Government preparation of financial statements that detect a material misstatement when Financial Reporting Manual (the give a true and fair view in accordance it exists. Misstatements can arise 2017/18 FReM). with the financial reporting framework, from fraud or error and are considered and for such internal control as the material if, individually or in the In our opinion the accompanying Accountable Officer determines is aggregate, they could reasonably be financial statements: necessary to enable the preparation of expected to influence the economic > give a true and fair view in accordance financial statements that are free from decisions of users taken on the basis of with the Public Finance and material misstatement, whether due to these financial statements. Accountability (Scotland) Act 2000 fraud or error. and directions made thereunder by the Scottish Ministers of the state of the body’s affairs as at 31 March 2018 and of its net expenditure for the year then ended;

ACCOUNTABILITY REPORT – INDEPENDENT AUDITOR’S REPORT SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Other information in the annual report Responsibilities for regularity Matters on which we are required to and accounts The Accountable Officer is responsible report by exception The Accountable Officer is responsible for ensuring the regularity of We are required by the Auditor General for the other information in the expenditure and income. We are for Scotland to report to you if, in our annual report and accounts. The responsible for expressing an opinion opinion: other information comprises the on the regularity of expenditure and > adequate accounting records have information other than the financial income in accordance with the Public not been kept; or statements and our auditor’s report Finance and Accountability (Scotland) > the financial statements and the thereon. Our opinion on the financial Act 2000. auditable part of the Remuneration statements does not cover the other and Staff Report are not in agreement information and we do not express Report on other requirements with the accounting records; or any form of assurance conclusion Opinions on other prescribed matters thereon except on matters prescribed We are required by the Auditor General > we have not received all the by the Auditor General for Scotland for Scotland to express an opinion on information and explanations we to the extent explicitly stated later the following matters. require for our audit. in this report. In connection with our We have nothing to report in respect of audit of the financial statements in In our opinion, the auditable part of these matters. accordance with ISAs (UK&I), our the Remuneration and Staff Report responsibility is to read all the financial has been properly prepared in and non-financial information in accordance with the Public Finance the annual report and accounts to and Accountability (Scotland) Act 2000 identify material inconsistencies with and directions made thereunder by the the audited financial statements and Scottish Ministers. to identify any information that is In our opinion, based on the work apparently materially incorrect based undertaken in the course of the audit on, or materially inconsistent with, Gary Devlin > the information given in the (for and on behalf of Scott-Moncrieff) the knowledge acquired by us in the Performance Report for the Exchange Place 3 course of performing the audit. If we financial year for which the financial Semple Street become aware of any apparent material statements are prepared is consistent Edinburgh misstatements or inconsistencies we with the financial statements and EH3 8BL consider the implications for our report. that report has been prepared in accordance with the Public Finance Report on regularity of expenditure 27 June 2018 and Accountability (Scotland) Act and income 2000 and directions made thereunder Opinion on regularity by the Scottish Ministers; and In our opinion in all material respects: > the information given in the > the expenditure and income in the Governance Statement for the financial statements were incurred financial year for which the financial or applied in accordance with any statements are prepared is consistent applicable enactments and guidance with the financial statements and issued by the Scottish Ministers, the that report has been prepared in Budget (Scotland) Act covering the accordance with the Public Finance financial year and sections 4 to 7 of and Accountability (Scotland) Act the Public Finance and Accountability 2000 and directions made thereunder (Scotland) Act 2000; and by the Scottish Ministers. > the sums paid out of the Scottish Consolidated Fund for the purpose of meeting the expenditure shown in the financial statements were applied in accordance with section 65 of the Scotland Act 1998.

ACCOUNTABILITY REPORT – INDEPENDENT AUDITOR’S REPORT 59

FINANCIAL STATEMENTS AND NOTES TO THE ACCOUNTS

FINANCIAL STATEMENTS AND NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

STATEMENT OF COMPREHENSIVE NET EXPENDITURE for the year ended 31 March 2018

2017-18 2016-17 Note £000 £000

Income Income from all sources 2 (7,389) (7,351)

Expenditure Staff costs Staff Report 170,437 168,884 Other expenditure 3 161,081 162,030

Total operating expenditure 331,518 330,914

Net operating expenditure 324,129 323,563

Finance expense 3 7,096 7,475

Net expenditure for the year 331,225 331,038

Other Comprehensive Net Expenditure

2017-18 2016-17 £000 £000

Items that will not be reclassified to net operating costs: Net (gain)/loss on revaluation of property, plant and equipment (86,512) 1,196 Comprehensive net expenditure for the year 244,713 332,234

The notes on pages 64 to 81 form part of these accounts.

STATEMENT OF COMPREHENSIVE NET EXPENDITURE 61

STATEMENT OF FINANCIAL POSITION as at 31 March 2018

2017-18 2016-17 Note £000 £000

Non-current assets Property, plant and equipment 4 1,142,631 1,072,162 Intangible assets 5 660 902 Other receivables 9 95 119 Total non-current assets 1,143,386 1,073,183 Current assets Assets classified as held for sale 4.1 0 42 Inventories 8 3,137 2,741 Trade and other receivables 9 7,009 5,808 Cash and cash equivalents 10 768 632 Total current assets 10,914 9,223 Total assets 1,154,300 1,082,406

Current liabilities Trade and other payables 11 (36,798) (40,758) Provisions 12 (4,380) (6,264) Total current liabilities (41,178) (47,022)

Total assets less net current liabilities 1,113,122 1,035,384 Non-current liabilities Other payables 11 (84,803) (89,107) Provisions 12 (13,696) (11,838) Total non-current liabilities (98,499) (100,945) Total assets less total liabilities 1,014,623 934,439 Taxpayers’ equity and other reserves General fund SOCTE 697,564 696,709 Revaluation reserve SOCTE 317,059 237,730 Total equity 1,014,623 934,439

Colin McConnell Chief Executive 27 June 2018

The Chief Executive authorised these financial statements for issue on 27 June 2018.

The notes on pages 64 to 81 form part of these accounts.

STATEMENT OF FINANCIAL POSITION SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

STATEMENT OF CASH FLOWS for the year ended 31 March 2018

2017-18 2016-17 Note £000 £000

Cash flows from operating activities Net operating cost (331,225) (331,038) Notional charges 17 103 103 Depreciation and impairment 3 27,859 24,694 Loss on sale of tangible assets 3 4 34 Interest payable in net operating cost for financing 7,089 7,458 (Increase) in inventories (396) (364) (Increase)/Decrease in trade receivables (1,135) 295 Increase in trade payables 2,781 20,551 Use of provisions 12 (26) 3,338 Net cash outflow from operating activities (294,946) (274,929)

Cash flows from investing activities Purchase of property, plant and equipment (14,187) (7,171) Purchase of intangible assets (128) (8) Proceeds of disposal of property, plant and equipment 11 7 Net cash outflow from investing activities (14,304) (7,172)

Cash flows from financing activities From the Consolidated Fund 324,564 296,785 Capital element of payments in respect of finance leases and on balance sheet PFI/PPP contracts (8,089) (7,351) Interest element of finance leases and on balance sheet PFI/PPP ontractsc (7,089) (7,458) Net financing 309,386 281,976

Net increase/(decrease) in cash and cash equivalents in the period 136 (125)

Cash and cash equivalents at the beginning of the period 10 632 757 Cash and cash equivalents at the end of the period 10 768 632

The notes on pages 64 to 81 form part of these accounts.

STATEMENT OF CASH FLOWS 63

STATEMENT OF CHANGES IN TAXPAYERS’ EQUITY for the year ended 31 March 2018

Revaluation General Fund Reserve Total Equity Note £000 £000 £000

Balance at 1 April 2016 723,800 245,985 969,785

Net funding from Scottish Government 296,785 0 296,785 Comprehensive Net Expenditure for the year (331,038) (1,196) (332,234) Auditors’ remuneration 17 103 0 103 Transfers between reserves 7,059 (7,059) 0

Balance at 31 March 2017 696,709 237,730 934,439

Net funding from Scottish Government 324,564 0 324,564 Comprehensive Net Expenditure for the year (331,225) 86,512 (244,713) Auditors’ remuneration 17 103 0 103 Transfer of land from NHS Greater Glasgow & Clyde 230 0 230 Transfers between reserves 7,183 (7,183) 0

Balance at 31 March 2018 697,564 317,059 1,014,623

The notes on pages 64 to 81 form part of these accounts.

STATEMENT OF CHANGES IN TAXPAYERS’ EQUITY SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

NOTES TO THE ACCOUNTS

1. Statement of Accounting Policies These financial statements have been prepared in accordance with the 2017-18 Government Financial Reporting Manual (FReM) issued by HM Treasury and the Accounts Direction issued by Scottish Ministers under section 19(4) of the Public Finance and Accountability (Scotland) Act 2000. The accounting policies contained in the FReM apply International Financial Reporting Standards (IFRS) as adapted or interpreted for the public sector context. Where the FReM permits a choice of accounting policy, the accounting policy which is judged to be the most appropriate to the particular circumstances of SPS for the purpose of giving a true and fair view has been selected. The particular policies adopted by SPS are described below. They have been applied consistently in dealing with items that are considered material to the accounts. The accounts are prepared using accounting policies, and, where necessary, estimation techniques, which are selected as the most appropriate for the purpose of giving a true and fair view in accordance with the principles set out in International Accounting Standard 8: Accounting Policies, Changes in Accounting Estimates and Errors. Changes in accounting policies which do not give rise to prior year adjustments are reported in the relevant note. Accounting Convention The accounts have been prepared under the historic cost convention modified to account for the revaluation of property, plant and equipment and intangible assets.

Key sources of judgement and estimation uncertainty Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Agency makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The Agency makes judgements in applying accounting policies. The estimates, assumptions and judgements that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the financial statements within the next financial year are addressed below within the individual accounting policies and notes to the accounts. The most significant estimates made by the Agency relate to the valuation of SPS properties and the sums recorded in provisions and contingent liabilities for staff and prisoner claims at 31 March. To assist the Agency with the estimates in valuing property the SPS commission professionally qualified firms to undertake a full revaluation of dwellings and other buildings at five yearly intervals with a rolling programme of valuations in the years in between. The SPS engage the services of the Scottish Government Legal Directorate, the Department of Work and Pensions and other legal firms to assist in preparing estimates of potential liabilities for staff and prisoner claims. The SPS also engage the services of professional accountancy firms to assist in the estimates for PFI/PPP Contracts and other Service Concession Arrangements.

Change in Accounting Estimate Indexation The indexation adjustment recorded in the 2017-18 accounts is calculated as the movement between the opening index as at 31 March 2017 and the closing index as at 31 March 2018. The index applied to buildings is based on a quarterly forecast which may be subject to change.

The total net impairment reversal credited to the Statement of Comprehensive Net Expenditure (SOCNE) is £5,522k. The impact of the revision to the opening index included within this total is £3,070k.

Property, Plant and Equipment Title to the freehold land and buildings shown in the accounts is held in the name of the Scottish Ministers.

Dwellings and other buildings Dwellings and other buildings are shown at fair value less subsequent depreciation. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is restated to the revalued amount of the asset. Valuation and useful life estimates in respect of SPS land and buildings have been supplied by the District Valuer Services (DVS), a division of the Valuation Office Agency. The valuations have been carried out by Royal Institute of Chartered Surveyors (RICS)

NOTES TO THE ACCOUNTS 65

Registered Valuer, and have been conducted in accordance with the professional standards of the RICS Valuation – Global Standards 2017 and the RICS Valuation – Professional Standards UK Edition (January 2014, revised April 2015). A full revaluation of dwellings and other buildings is carried out at five yearly intervals. In the intervening years, both specialised and non-specialised properties are valued on a rolling programme revaluing, on average, four establishments each year. Appropriate indices provided by the Valuer are used to restate values in the intervening years between full valuations. The normal threshold for capitalisation of buildings is £1,000.

Plant and Equipment, Fixtures and Fittings, Motor Vehicles and Information Technology Depreciated historic cost has been used as a proxy for the fair value of plant and equipment, fixtures and fittings, motor vehicles and information technology. All of the assets in these categories have low values and short useful economic lives which realistically reflect the life of the asset and a depreciation charge which provides a realistic reflection of consumption. The normal threshold for capitalisation of assets in these categories is £1,000.

Assets under construction Assets under construction are carried at the costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Assets under construction are transferred to either the appropriate category of property, plant and equipment or intangible assets when completed and ready for use.

Revaluation reserve Increases in the carrying amount arising on revaluation of property, plant and equipment are credited to the revaluation reserve in taxpayers’ equity. Decreases that offset previous increases of the same asset are charged against the revaluation reserve directly in equity; all other decreases, including permanent diminutions as a result of a clear consumption of economic benefits or service potential, are charged to the statement of comprehensive net expenditure. Depreciation is charged to expenditure on the revalued amount of assets. An element of the depreciation therefore arises due to the increase in valuation and is in excess of the depreciation that would be charged on the historical cost of assets. The amount relating to this excess is a realised gain on revaluation and is transferred from the revaluation reserve to the general fund.

Depreciation Land held under freehold is not depreciated. Assets under construction are not depreciated until the asset under construction is capable of operating in the manner intended by management. Depreciation is provided on all other tangible and intangible fixed assets at rates calculated to write off the valuation, less estimated residual values, of each asset evenly over its expected useful life. Asset lives are assessed on an asset by asset basis as follows: Freehold buildings Not exceeding 80 years Buildings held under PFI/PPP contracts Not exceeding 80 years Fixed Plant and Equipment Not exceeding 40 years Fixtures and Fittings 5 years Motor Vehicles 5 years Moveable Plant and Equipment 5 years Information Technology 2 years Software 2 years Plant and Equipment held under a finance lease unexpired term of lease Motor Vehicles held under Court Custody and Prisoner Escort Service Contract unexpired term of lease Information Technology held under a finance lease unexpired term of lease Depreciation is not charged in the month of acquisition but is charged over the useful economic life and in the month of disposal. The asset’s residual values and useful lives are reviewed, and adjusted if appropriate, at each statement of financial position date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of comprehensive net expenditure. When revalued assets are sold, the amounts included in the revaluation reserve are transferred to the general fund.

Assets Held for Sale A property is derecognised and held for sale under IFRS5, Non-Current Assets Held for Sale and Discontinued Operations when all of the following requirements are met: > It is available for immediate sale; > A plan is in place, supported by management and steps have been taken to conclude the sale; and > It is actively marketed and there is an expectation that the sale will be made in less than 12 months. Assets held for sale include assets where SPS intends and expects to sell within one year from the date of classification of held for sale. Assets classified as held for sale are measured at the lower of their carrying amounts immediately prior to their classification as held for sale and their fair value less costs to sell. Assets classified as held for sale are not subject to depreciation or amortisation.

Donated Assets In Accordance with IAS16 Property, Plant and Equipment and the HM Treasury Financial Reporting Manual, Donated Assets are capitalised at their fair value on receipt and this value is recognised as income and taken to the Statement of Comprehensive Net Expenditure. The donated assets are revalued, depreciated and subject to impairment review in the same way as non-current assets. Subsequent revaluations are taken to the revaluation reserve. Where the donator has imposed a condition that the future economic benefits embodied in the donation are consumed as specified by the donor, or returned to them, then the receipt is treated as deferred income.

Intangible Assets Intangible assets are valued on a historic cost basis. Future economic benefit has been used as the criteria on assessing whether an intangible asset meets the definition and recognition criteria of IAS38 where assets do not generate income. IAS38 defines future economic benefit as, ‘revenue from the sale of products or services, cost savings, or other benefits resulting from the use of the asset by the entity.’ Amortisation is applied at rates calculated to write off the cost by equal instalments over the estimated useful life.

Financial Instruments The SPS has considered its exposure to the following risks from the use of financial instruments:-

Liquidity risk Liquidity risk is the funding risk to SPS that liabilities cannot be met when they fall due or can only be met at an uneconomic price. SPS has no borrowings and relies primarily on funding from the Scottish Government for its cash requirements. SPS is therefore, not exposed to liquidity risks.

Credit risk Credit risk is the risk of financial loss to SPS if a debtor or counter party fails to meet its contractual obligations and arises from the trade receivables and other debtors. SPS carries out appropriate credit checks on potential customers before significant sales transactions are entered into in order to mitigate the credit risk from any single counterparty. The maximum exposure to credit risk is represented by the carrying value of trade receivables on the statement of financial position.

Market risk Market risk is the risk to SPS that the value of an investment will decrease due to moves in market factors. SPS has no material deposits and all material assets and liabilities are denominated in sterling. SPS is not, therefore, exposed to interest rate or currency risk.

Cash and cash equivalents Cash and cash equivalents includes cash in hand, deposits held at call with banks, cash balances held by the Government Banking Service and other short-term highly liquid investments with original maturities of three months or less.

NOTES TO THE ACCOUNTS 67

Inventories Inventories are assets in the form of materials or supplies which are consumed or distributed in the course of SPS operations. Inventories include equipment, uniforms, locks and other operational consumables and are included in the Statement of Financial Position (SOFP). Stock and work in progress are valued as follows: > Finished goods are valued at the lower of cost or, where materially different, current replacement cost and net realisable value; > Work in progress is valued at the lower of cost, including appropriate overheads, and net realisable value. Research and Development Expenditure on research and development is treated as an operating cost in the year in which it is incurred.

Service Concessions and Private Finance Contracts SPS assesses the contracts that utilise assets to determine if the contract represents a service concession arrangement under the conditions of IFRIC 12, Service Concession Arrangements. Contracts which meet the recognition criteria are recognised in the statement of financial position.

PFI/PPP Contracts PFI/PPP transactions are accounted for in accordance with IFRIC 12, as adapted for the public sector context by the FReM. The SPS has awarded Public Private Partnership (PPP) contracts, to design, construct, manage and finance prisons at HMP Kilmarnock and HMP Addiewell. Both contracts were let for 25 year operating periods, commencing in March 1999 for HMP Kilmarnock and in December 2008 for HMP Addiewell. Assets and liabilities that are assessed to be on balance sheet are measured as follows: > Where the contract is separable between the service element, the interest charge and the infrastructure asset, the asset will be measured in accordance with IAS 17 Leases, with the service element and the interest charge recognised as incurred over the term of the concession arrangement. > Where there is a unitary payment stream that includes infrastructure and service elements that cannot be separated, the various elements will be separated using estimation techniques including obtaining information from the operator or using the fair value approach. The SPS recognises a liability for the capital value of the contract. That liability does not include the interest charge and service elements, which are expensed annually through the statement of comprehensive net expenditure. Assets are subsequently measured consistently with other assets in their class using IAS16, Property, Plant and Equipment, adopting an appropriate asset revaluation approach. Liabilities are measured using the appropriate discount rate, taking account of the reduction arising from capital payments included in the unitary payment stream. Any revenue received by SPS is recognised in line with IAS18, Revenue. In both of the projects, the financial models supplied by each project operators do not separately identify a costed lifecycle maintenance programme. SPS has therefore opted not to set aside amounts from the unitary payment as payment for lifecycle maintenance. Instead, when the project operators replace a capital asset, the fair value of this replacement item is recognised as property, plant and equipment, balanced by a credit to the revaluation reserve. The replaced asset’s existing value is written out of property, plant and equipment and either impaired or debited to the revaluation reserve. In accordance with IAS 17, contingent rentals are defined as the ‘portion of the lease payments that is not fixed in amount but is based on the future amount of a factor that changes other than with the passage of time’. Examples of contingent rents include payments governed by movements in future price indices. Both financial models calculate contingent rent as follows: > The change in cash unitary charge arising from indexation is offset against the impact of applying the same indexation factor to the real terms operating and lifecycle costs; and > Any remaining cash difference between the change in unitary charge and the indexation factor’s effect on operating costs is charged to contingent rent.

Other Service Concession Arrangements The Court Custody and Prisoner Escort Service Contract meets the requirements of IFRIC 12 and are recognised in these accounts as a service concession arrangement.

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

The infrastructure assets related to this contract are recognised as non-current assets. These assets are accounted for in the same manner as other assets within the same class. The initial recognition of service concession infrastructure assets is at the Contractor’s estimate of the assets’ fair value. The useful economic life was determined as the shorter of the duration of the contract, or the life of the asset. The interest rate used was derived by comparing the total payments under the contract to the element which constitutes capital repayment. Where the SPS meets the controls test under IFRIC 12, the underlying assets are recognised on the statement of financial position. For leased assets, the finance lease is treated according to IAS17 Leases, and the asset and corresponding liability is capitalised. This includes the deferred residual interest which is recognised as a long term liability and reflects the liability to make future capital payments to acquire the vehicles at the end of the contract period.

Income SPS accounts for income in accordance with the recognition criteria set out in IAS18 Revenue. Income is recognised when the amounts can be reliably measured and services have been rendered and/or goods dispatched. The main sources of income for SPS include sales from prisoners’ canteen and prisoners’ telephone system and income from sale of goods produced by prison industries. Employee Benefits Short-term Employee Benefits Salaries, wages and employment-related payments are recognised in the year in which the service is received from employees. The cost of annual leave and flexible working time entitlement earned but not taken by employees at the end of the year is recognised in the financial statements to the extent that employees are permitted to carry-forward leave into the following year.

Pension Costs and other post-retirement benefits Past and present employees are covered by the provisions of the Principal Civil Service Pension Scheme (PCSPS) and the Civil Servant and Other Pension Scheme (CSOPS), which are unfunded multi-employer defined benefit schemes but the SPS is unable to identify its share of the underlying assets and liabilities. The schemes are accounted for as a defined contribution schemes under the multi- employer exemption permitted in IAS19. The SPS recognises the expected cost of these elements on a systematic and rational basis over the period during which it benefits from employees’ services by payment to the PCSPS/CSOPS of amounts calculated on an accruing basis. Liability for payment of future benefits is a charge on the PCSPS/CSOPS. In respect of the defined contribution schemes, the SPS recognises the contribution payable for the year. Early severance payment obligations are expensed in the year in which the decision of the departure is agreed. Additional pension liabilities arising from early retirements are not funded by the scheme except where the retirement is due to ill health. The full amount of the liability for the additional costs is charged to the outturn statement at the time the SPS commits itself to the retirement, regardless of the method of payment. In previous years, the SPS met the additional costs in respect of employees who retired early by paying the required amounts annually to the PCSPS over the period between early departure and normal retirement date. The SPS provided for this in full when the early retirement programme became binding by establishing a provision for the estimated payments.

Termination Benefits SPS accounts for termination benefits in accordance with IAS 19 Employee benefits. Termination benefits are payable as a result of a decision to terminate an employee’s employment before the normal retirement date, and the liability is recognised when the offer of the benefits can no longer be withdrawn at the earlier of i) acceptance of the offer by the employee or ii) when a legal, regulatory or contractual restriction on the ability to withdraw the offer takes effect. Leases Finance leases In accordance with IAS 17 Leases, where substantially all risks and rewards of ownership of a leased asset are borne by SPS, the asset is recorded as Property, Plant and Equipment and a corresponding liability is recorded. The value at which both are recognised is the lower of the fair value of the asset or the present value of the minimum lease payments. Assets held under finance leases are valued at their fair values and are depreciated over the remaining period of the lease in accordance with IFRS. The asset and liability are recognised at the inception of the lease, and are de-recognised when the liability is discharged, cancelled or expires. The annual rental is split between the repayment of the liability and a finance cost. The annual finance cost is calculated by applying the implicit interest rate to the outstanding liability and is charged to interest payable in the statement of comprehensive net expenditure.

NOTES TO THE ACCOUNTS 69

Operating leases Other leases, that are not finance leases, are regarded as operating leases and the rentals are charged to expenditure on a straight- line basis over the term of the lease. Operating lease incentives received are added to the lease rentals and charged to expenditure over the life of the lease. Leases of land and buildings Where a lease is for land and buildings, the land component is separated from the building component and the classification for each is assessed separately. Leased land is treated as an operating lease unless title to the land is expected to transfer. Provisions and Contingent Liabilities In accordance with IAS37 provisions, including provisions for staff and prisoner claims, are recognised in the statement of financial position when the SPS has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefit will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected, risk adjusted and future cash flows using the discount rate prescribed by HM Treasury. Related Party Transactions Material related party transactions are disclosed in the notes to the accounts in line with the requirements of IAS24.

Value Added Tax The majority of services provided by the SPS fall outwith the scope of Value Added Tax (VAT). However, the manufacturing and sale of goods to external bodies is subject to VAT on both inputs and outputs. The SPS can recover this input VAT as well as VAT on certain contracted-out services. Income is shown in the accounts net of recoverable VAT.

Insurance With the exception of Public Private Partnership contracts, no outside insurance is affected against fire, explosion, common law, third party and similar risks, except where there is a statutory requirement to do so.

Third Party Assets SPS holds as custodian monies belonging to third parties. These assets are not recognised on the Statement of Financial Position and are disclosed within the notes to the accounts. Segmental Reporting The SPS currently operates three segments, namely; > Public Prisons > Private Prisons; and > Court Custody and Prisoner Escort Services (CCPES) IFRS 8 Segmental Reporting requires operating segments to be identified on the basis of internal reports about components of the SPS that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segments and assess their performance. The SPS reports segmental information within its consolidated operating cost statements which are prepared on the basis of its portfolios. Accounting standards issued but not yet effective There are new accounting standards that have been issued but have not yet been applied by the SPS in these financial statements. The new standards that are considered relevant to SPS and the anticipated impact on the accounts are as follows:

> IFRS 16 – Leases This standard has been created to harmonise the rules regarding leases between the IASB and the FASB in the United States. It will supersede the existing IAS 17 but won’t come into effect until January 2019. The extent to which this new standard will apply to the public sector is currently being considered by the Financial Reporting Advisory Board.

> IFRS 15 – Revenue This standard comes into effect on 1 January 2018. The standard is not expected to have a significant impact on these accounts.

> IFRS 9 – Financial Instruments This standard was issued in November 2014, and is effective from 1 January 2018. The adoption of this standard could change the classification and measurement of financial assets. This standard is not expected to have a significant impact on the values reported in these accounts.

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

2. Income from all Sources 2017-18 2016-17 £000 £000 Income from sales 858 1,088 Rental income 5 7 General revenue 1,986 1,723 Income from prisoner’s canteen 4,540 4,533 7,389 7,351 Income from sales includes the sale of goods produced by prison industries. General revenue includes income from the prisoner telephone system.

3. Other Expenditure 2017-18 2016-17 £000 £000 Staff costs – Wages and salaries 131,462 129,997 – Social security costs 12,902 12,766 – Other pension costs 26,104 26,178 PFI service charges 33,294 32,987 Prisoner escort and court custody service 23,399 22,137 Repairs and maintenance 13,022 16,742 Victualling and other supplies 14,299 14,545 Other current expenditure 13,937 13,917 Heat, light, telephone etc. 10,275 10,457 Interest charges 7,094 7,465 Rates 6,231 7,378 Other staff related costs 6,955 4,225 General expenditure 3,640 3,643 Prisoner earnings 2,989 3,103 PPP/PFI contingent rent 3,705 3,336 Rentals under operating leases – Land and buildings 995 935 – Other 366 409 Finance lease 5 0 Non-cash items – Depreciation and impairment 27,859 24,694 – Loss on sale of assets 4 34 – Auditors’ remuneration 103 103 – Provisions provided for in year (28) 3,328 – Borrowing costs of provisions (unwinding of discount on provisions) 2 10 338,614 338,389

NOTES TO THE ACCOUNTS 71

Further analysis of staff costs is located in the Staff Report on page 50 in the Accountability Section. Staff costs shown in this table include costs for non-permanent staff and are net of recharges for outward secondees. Pension costs have also been adjusted for the movement in the provision for early retirements. Depreciation is applied to tangible, donated and intangible fixed assets. It includes £5,522k credit (2016-17 £10,970k credit), in relation to impairments arising upon revaluation of land and buildings. Other current expenditure includes fees paid for education contracts, £4,481k (2016-17 £4,542k) and social work costs £4,677k (2016-17 £4,660k). During the year SPS purchased non-audit services from its auditor, Scott Moncrieff totalling £9k.

4. Property, Plant and Equipment Including Donated Motor Plant & Comp Fixtures Assets Land Buildings Dwellings Vehicles Equip Equip & Fittings AUC Total Cost or Valuation £000 £000 £000 £000 £000 £000 £000 £000 £000

At 1 April 2017 68,256 395,019 600,602 11,126 26,048 7,696 583 809 1,110,139 Additions 4,979 665 955 86 1,387 320 14 3,055 11,461 Completed Assets under Construction 0 125 279 0 295 0 0 (699) 0 Revaluation 547 38,357 57,617 0 0 0 0 0 96,521 Impairment (774) 0 (868) 0 0 0 0 0 (1,642) Reclassification 0 0 0 (1) 72 (207) (50) 0 (186) Disposals 0 0 0 (10) (1,053) (167) (7) 0 (1,237) At 31 March 2018 73,008 434,166 658,585 11,201 26,749 7,642 540 3,165 1,215,056 Depreciation At 1 April 2017 0 345 8 7,694 22,542 6,828 560 0 37,977 Charge 0 11,773 17,774 1,356 1,589 510 9 0 33,011 Revaluation 0 1,131 1,714 0 0 0 0 0 2,845 Reclassification 0 0 0 (1) 57 (197) (45) 0 (186) Disposals 0 0 0 (10) (1,038) (167) (7) 0 (1,222) At 31 March 2018 0 13,249 19,496 9,039 23,150 6,974 517 0 72,425 Carrying Value at 31 March 2018 73,008 420,917 639,089 2,162 3,599 668 23 3,165 1,142,631 Carrying Value at 31 March 2017 68,256 394,674 600,594 3,432 3,506 868 23 809 1,072,162

Asset financing: Owned 73,008 374,446 551,841 113 3,599 668 23 3,165 1,006,863 Finance Leased 0 0 0 2,049 0 0 0 0 2,049 On-balance sheet PFI contracts 0 46,471 87,248 0 0 0 0 0 133,719 Carrying Value at 31 March 2018 73,008 420,917 639,089 2,162 3,599 668 23 3,165 1,142,631

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Including Donated Motor Plant & Comp Fixtures Assets Land Buildings Dwellings Vehicles Equip Equip & Fittings AUC Total Cost or Valuation £000 £000 £000 £000 £000 £000 £000 £000 £000

At 1 April 2016 71,407 409,702 627,214 11,131 25,985 6,981 618 1,742 1,154,780 Additions 0 369 609 3 658 77 0 676 2,392 Completed Assets under Construction 0 451 0 0 0 664 0 (1,115) 0 Revaluation (3,142) (18,225) (26,925) 0 0 0 0 0 (48,292) Impairment 0 2,754 (295) 0 0 0 0 (1) 2,458 Reclassification (9) (32) (1) 0 0 0 0 (493) (535) Disposals 0 0 0 (8) (595) (26) (35) 0 (664) At 31 March 2017 68,256 395,019 600,602 11,126 26,048 7,696 583 809 1,110,139 Depreciation At 1 April 2016 0 11,970 13,381 6,317 21,069 6,021 579 0 59,337 Charge 0 12,247 18,802 1,385 2,027 833 16 0 35,310 Revaluation 0 (19,192) (27,904) 0 0 0 0 0 (47,096) Impairment 0 (4,680) (4,271) 0 0 0 0 0 (8,951) Disposals 0 0 0 (8) (554) (26) (35) 0 (623) At 31 March 2017 0 345 8 7,694 22,542 6,828 560 0 37,977 Carrying Value at 31 March 2017 68,256 394,674 600,594 3,432 3,506 868 23 809 1,072,162 Carrying Value at 31 March 2016 71,407 397,732 613,833 4,814 4,916 960 39 1,742 1,095,443

Asset financing: Owned 68,256 351,246 518,971 69 3,506 868 23 809 943,748 Finance Leased 0 0 0 3,363 0 0 0 0 3,363 On-balance sheet PFI contracts 0 43,428 81,623 0 0 0 0 0 125,051 Carrying Value at 31 March 2017 68,256 394,674 600,594 3,432 3,506 868 23 809 1,072,162

As part of the five year rolling programme, all non-operational and surplus land underwent a formal inspection and revaluation on the basis of Market Value, at 31st March 2018. Valuations were carried out by the District Valuer Services (DVS), a division of the Valuations Office Agency. The valuations have been carried out by a Royal Institute of Chartered Surveyors (RICS) Registered Valuer, and have been conducted in accordance with the RICS Valuation – Professional Standards 2014 UK Edition (revised April 2015). Non-operational and surplus land have been valued at fair value in accordance with IFRS 13 as required by the FReM. The value of these assets is £3,808k. Land, building and dwellings include properties for the Public Private Partnerships (PPPs) at HMP Kilmarnock and HMP Addiewell. The tenure of the contracts is 25 years, at which time the assets revert to SPS at nil cost. The court custody and prisoner escort service is included within Motor Vehicles; the contract is accounted for in the same manner as other assets with the same class. The underlying value of the infrastructure assets are the contractor’s estimate of fair value. In accordance with IFRIC12 the infrastructure assets related to this contract are recognised as non-current assets.

NOTES TO THE ACCOUNTS 73

The Scottish Government’s Infrastructure and Investment Plan (IIP) 2015 (revised March 2018) www.gov.scot/Topics/Government/ Finance/18232/IIP details prison development plans in 2018 and beyond. Land additions relate to HMP Highland and the Community Custodial Unit at Maryhill, Glasgow. HMP Highland comprises of land extending to 7.32 hectares acquired on 29 March 2018 at a gross cost of £4,749k (inclusive of VAT and Section 75 costs), net cost £3,975k following impairment of non-recoverable VAT. In accordance with the Scottish Government Scottish Public Finance Manual (SPFM), the site of Maryhill Health Centre, Glasgow was transferred to Scottish Prison Service by NHS Greater Glasgow & Clyde on 15 September 2017. Title to the property remains with Scottish Ministers, although full rights and responsibilities were transferred to Scottish Prison Service who are subsequently responsible for all associated costs. The site was subject to a professional valuation as at September 2017 and was transferred at a market value of £230k. The transfer is reflected against Land additions in Property, Plant and Equipment and also through Reserves in the Statement of Changes in Taxpayers Equity. The remaining lives for the buildings, which are scheduled for demolition and closure, have been adjusted to reflect the planned period to demolition and closure as per the IIP. The total depreciation charged to the Statement of Comprehensive Net Expenditure is shown in Note 3. Included within the carrying values of buildings is the Visitors’ Reception Centre at HMP Edinburgh, donated in March 2000. Covenants of the donation required that the building is leased to the developer, for a peppercorn rent for a period of 35 years, to be used solely as a Visitors’ Reception Centre. The net book value at 31 March 2018 was £1,264k.

4.1 Assets Held for Sale 2017-18 2016-17 £000 £000 Property, Plant and Equipment At 1 April 42 0 Reclassification 0 42 Disposals (42) 0 At 31 March 0 42

The sale of garage sites and associated land at HMP Grampian was concluded in November 2017.

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

5. Intangible Assets

Information Technology Software AUC Total £000 £000 £000 £000 Cost At 1 April 2017 3,774 3,169 264 7,207 Additions 25 37 66 128 Completed AUC 8 40 (48) 0 Reclassifications 0 197 0 197 Disposals (2,676) (1,063) 0 (3,739) At 31 March 2018 1,131 2,380 282 3,793

Amortisation At 1 April 2017 3,378 2,927 0 6,305 Charge 211 159 0 370 Reclassification 0 197 0 197 Disposals (2,676) (1,063) 0 (3,739) At 31 March 2018 913 2,220 0 3,133

Carrying Value as at 31 March 2018 218 160 282 660 Carrying Value as at 31 March 2017 396 242 264 902 Asset financing: Owned 218 160 282 660

Information Technology Software AUC Total £000 £000 £000 £000 Cost At 1 April 2016 3,497 2,875 774 7,146 Additions 0 0 8 8 Completed AUC 277 295 (572) 0 Impairment 0 0 (439) (439) Reclassifications 0 0 493 493 Disposals 0 (1) 0 (1) At 31 March 2017 3,774 3,169 264 7,207

Amortisation At 1 April 2016 3,228 2,724 0 5,952 Charge 150 204 0 354 Disposals 0 (1) 0 (1) At 31 March 2017 3,378 2,927 0 6,305

Carrying Value as at 31 March 2017 396 242 264 902 Carrying Value as at 31 March 2016 269 151 774 1,194 Asset financing: Owned 396 242 264 902

NOTES TO THE ACCOUNTS 75

6. Financial Instruments As the cash requirements of the SPS are met through the spending review process, financial instruments play a more limited role in creating and managing risk than in a non public sector body. The majority of financial instruments relate to contracts to buy non- financial items in line with the SPS’ expected purchase and usage requirements and the SPS is therefore exposed to little credit, liquidity or market risk. 7. Impairment Analysis 2017-18 2016-17 £000 £000 Property, Plant and Equipment Impairment charge 1,642 440 Impairment reversal (7,164) (11,410) Revaluation reserve 652 13,728 Total (4,870) 2,758 The net impairment as at the 31 March 2018 was £5,522k. Impairment charges to the Statement of Comprehensive Net Expenditure (SOCNE) relate to diminutions of land at HMP Highland of £774k (attributed to non-recoverable VAT) and the functional obsolescence within buildings at HMP Barlinnie and HMP Perth of £868k. Impairment reversals of £7,164k represent reversals of impairments charged to the SOCNE in previous years in relation to HMP Addiewell as a result of the application of indexation to the specialised and non-specialised properties. Impairment charges of £652k taken through the revaluation reserve are reflective of a downward valuation of the land sites at Inverclyde and HMP YOI Polmont. 8. Inventories 2017-18 2016-17 £000 £000 The main categories of stock held are: Consumables 1,130 1,173 Works, estates and locks 928 805 Industries raw materials, work in progress and finished goods for resale 1,091 859 Provision for obsolete stock – specific (12) (96) 3,137 2,741

9. Trade Receivables and Other Current Assets Analysis by Type 2017-18 2016-17 £000 £000 Amounts due within one year: Recoverable VAT 4,393 3,229 Trade receivables 11 176 Other receivables 616 349 Prepayments and accrued income 1,989 2,054 7,009 5,808 Amounts due after more than one year: Other receivables 95 119

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

10. Cash and Cash Equivalents 2017-18 2016-17 £000 £000 Balance as at 1 April 632 757 Net change in cash and cash equivalents 136 (125) Balance as at 31 March 768 632

The following balances at 31 March were held at: Government Banking Service 570 444 Commercial banks 149 137 Cash in hand 49 51 Balance at 31 March 768 632

11. Trade Payables and Other Current Liabilities Analysis by Type: 2017-18 2016-17 £000 £000 Amounts due within one year: Other taxation and social security 3,178 3,088 Trade payables 5,187 2,950 Accruals and deferred income 20,249 26,822 Other payables 2,952 2,881 Amounts due to Justice Department 768 632 PFI/PPP and other service concession arrangements <1 year 4,464 4,385 36,798 40,758

Amounts due after more than one year: PFI/PPP and other service concession arrangements >1 year 83,640 88,105 Deferred residual interest 954 954 Other accruals 209 48 84,803 89,107

The deferred residual interest of £954k (2016-17 £954k) relates to the residual value of vehicles under the Court Custody and Prison Escort Service concession contract which revert to the lessor for nil consideration at the end of the contract.

NOTES TO THE ACCOUNTS 77

12. Provisions for Liabilities and Charges 2017-18 2017-18 2017-18 2017-18 2017-18 2017-18 2016-17 £000 £000 £000 £000 £000 £000 £000 Prisoner Injury Dilapidation Demolition Other Claims Benefit Costs Costs Charges Total Total Balance at 1 April 2,723 10,678 1,773 1,713 1,215 18,102 14,764 Provided in the year 639 740 180 100 1,490 3,149 5,396 Provisions utilised in the year (334) (449) (3) (88) (156) (1,030) (1,353) Unwinding of discount 0 2 0 0 0 2 10 Provisions not required written back (1,335) (202) (3) (208) (399) (2,147) (715) Balance at 31 March 1,693 10,769 1,947 1,517 2,150 18,076 18,102

Analysis of expected timing of discounted flows 2017-18 2017-18 2017-18 2017-18 2017-18 2017-18 2016-17 £000 £000 £000 £000 £000 £000 £000 Prisoner Injury Dilapidation Demolition Other Claims Benefit Costs Costs Charges Total Total Not later than one year 1,693 468 0 100 2,119 4,380 6,264 Later than one year and not later than five years 0 1,862 1,947 1,417 31 5,257 3,449 Later than five years 0 8,439 0 0 0 8,439 8,389 Balance at 31 March 1,693 10,769 1,947 1,517 2,150 18,076 18,102

Prisoner Claims A number of historical claims brought by prisoners which concerned prison conditions remain in the courts. There are various reasons for this including the withdrawal of the Solicitors acting for the offender. These have been reported in previous Annual Reports. A number of other recent convention rights claims have been lodged in court and provision has been made for these. The majority of these relate to Articles 3, 5(4), 6 and 8 of the European Convention of Human Rights. Section 14 of the Scotland Act 2012 repealed the Convention Rights Proceedings (Amendment) (Scotland) Act 2009 and amended the Scotland Act 1998 to provide a one year time limit for convention rights claims similar to that contained in the Human Rights Act 1998. This means that a convention rights claim brought against Scottish Ministers must be brought against Scottish Ministers within one year unless a court or tribunal considers it ‘equitable having regard to all circumstances’ to allow a claim out with this time limit.

Dilapidation Costs Dilapidation costs are in respect of Calton House which become payable on expiry of the lease in October 2022.

Injury Benefits Injury Benefits include estimates of amounts payable to former employees for loss of earnings under the Civil Service Injury Benefit Scheme.

Demolition Costs Also included within provisions are amounts for demolition works on the site of HMP & YOI Cornton Vale associated with the development of the Women’s National Facility.

Other Charges Other charges include estimates of amounts payable for staff compensation and related costs and early retirement costs.

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

13. Commitments under Leases Operating Leases Total future minimum lease payments under operating leases are given in the table below for each of the following periods: Obligations under operating leases for the following periods comprise: 2017-18 2016-17 £000 £000 Land Not later than one year 33 17 Later than one year and not later than five years 120 0 153 17 Buildings Not later than one year 701 375 Later than one year and not later than five years 2,515 0 3,216 375 Other Not later than one year 616 699 Later than one year and not later than five years 490 758 1,106 1,457

14. Commitments under PFI Contracts and Other Service Concession Arrangements The total amount charged in the Statement of Comprehensive Net Expenditure in respect of the service element of on-balance sheet PFI and other service concession transactions was £60,398k (2016-17 £58,460k). Total future obligations under on-balance sheet PFI and other service concession arrangements are given in the table below for each of the following periods:

Minimum lease payments: 2017-18 2016-17 £000 £000 Due within one year 71,915 70,145 Due later than one year and not later than five years 208,572 226,597 Due later than five years 510,668 564,558 791,155 861,300 Less interest element (62,885) (69,973) Present value 728,270 791,327

Service elements due in future periods, included above, are: 2017-18 2016-17 £000 £000 Due within one year 60,820 58,672 Due later than one year and not later than five years 171,105 187,385 Due later than five years 408,240 452,780 Total service elements due in future periods 640,165 698,837

NOTES TO THE ACCOUNTS 79

PFI Contracts The SPS has awarded Public Private Partnership (PPP) contracts, to design, construct, manage and finance prisons at HMP Kilmarnock and HMP Addiewell. Both contracts were let for 25 year operating periods, commencing in March 1999 for HMP Kilmarnock and in December 2008 for HMP Addiewell. Both contracts are treated as on balance sheet in accordance with IFRIC 12, Service Concession Arrangements. The minimum lease payments that SPS is committed to make over the remainder of the respective contract periods are included in the above table in respect of HMP Kilmarnock and HMP Addiewell. The annual payments will vary over the remaining life of each contract in accordance with the specified indexation and unitary charge mechanisms. The capital liability for HMP Kilmarnock is now nil, however, payments for the service element continue to the end of the contract. Other Service Concession Arrangements In March 2011, the SPS awarded a contract for Court Custody and Prisoner Escort service to G4S. The contract was let for a seven year period with an option to extend for a further three years. The service commenced in January 2012 and expires in January 2019. The vehicles provided with the service are treated as on balance sheet in accordance with IFRIC 12, Service Concession Arrangements. The minimum lease payments that SPS is committed to make over the remainder of the respective contract periods are included in the above table. The annual payments will vary over the remaining life of the contract in accordance with the specified indexation and unitary charge mechanisms. In the event of termination of these contracts, in accordance with Scottish Government guidance, the SPS has committed to pay certain amounts to the contractor according to defined formulae in the respective contracts. The specific value of the termination sum would depend on the reason for termination and the timing in relation to the contract expiry date. A copy of the contracts for HMP Kilmarnock, HMP Addiewell and Court Custody and Prisoner Escort Services are available on the SPS website www.sps.gov.uk. In March 2018, the SPS awarded a contract for Court Custody and Prisoner Escort services to GEOAmey PECS. The contract was let for an eight year period with an option to extend for a further four years. The service will commence in January 2019. The minimum lease payments/service elements are not included in the tables above. SPS engage the services of professional accountancy firms to assist in the estimates for PFI/PPP Contracts and other Service Concession Arrangements and this exercise will be carried out for the new contract.

15. Capital Commitments Contracted capital commitments at 31 March not otherwise included in these accounts: 2017-18 2016-17 £000 £000 Property, Plant and Equipment 65 559

16. Contingent Liabilities The Agency has the following contingent liabilities: 2017-18 2016-17 £000 £000 Prisoner Claims 594 3,419 Other Charges 189 3,946 783 7,365 Contingent liabilities for prisoner claims have been included in respect of prisoner compensation and expenses for potential liability in a number of cases where challenges have been made against SPS but which await court consideration or decisions of higher courts.

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

17. Notional Charges The following notional charge has been included in the accounts: 2017-18 2016-17 £000 £000 Statutory audit services 103 103 Total auditor’s remuneration 103 103 The audit fee is a notional charge, as notified to us by our auditors, Scott Moncrieff.

18. Key Financial Target The annual average cost per prisoner place, which excludes capital charges, exceptional payments and the cost of the Court Custody and Prisoner Escort contract, was £35,293 (2016-17 £35,325). For information purposes, the actual annual average cost per prisoner place, calculated on a resource accounting basis (including depreciation and impairment charges), in 2017-18 was £38,903 (2016-17 £38,370). The actual annual average cost per prisoner place including exceptional payments in 2017-18 was £35,381 (2016-17 £35,301). Exceptional payments include charges/release of provisions for prisoner compensation and related costs.

19. Related Party Transactions The SPS is an Executive Agency of the Scottish Government. The Scottish Government is regarded as a related party with which the SPS has various material transactions during the year. In 2017-18, none of the Board Members, members of key management staff or other related parties has undertaken any material transactions with the SPS.

20. Third Party Assets At 31 March 2018 the SPS operated bank accounts holding funds in respect of prisoners monies and common good funds. The balances on these accounts are held on behalf of prisoners and are therefore not included in the financial statements. The value of the funds held in these accounts are set out in the tables below.

20.1 Prisoners’ Funds 2017-18 2016-17 £000 £000 Balance as at 1 April 862 802 Funds paid in during the year 10,908 10,926 Funds paid out during the year (10,837) (10,866) Balance as at 31 March 933 862

20.2 Common Good Fund 2017-18 2016-17 £000 £000 Balance as at 1 April 195 210 Funds paid in during the year 510 543 Funds paid out during the year (463) (558) Balance as at 31 March 242 195 The Common Good Fund in each establishment exists for the benefit of the prisoners in custody at that establishment.

NOTES TO THE ACCOUNTS 81

21. Analysis of Net Expenditure by Segment The SPS currently operates three segments, namely: > Public Prisons; > Private Prisons; and > Court Custody and Prisoner Escort Services (CCPES). The SPS is legally required to deliver custodial services for all those sent to it by the courts. During 2017-18 there were thirteen publicly managed prisons and two privately-managed prisons. The location of each of the establishments is listed on Appendix 1. SPS agrees a service framework with each public sector prison and manages private sector providers of prisons and custodial services under contract arrangements. Copies of the services agreements with the publicly managed prisons and contracts with the privately managed providers of custodial services are available on the SPS website www.sps.gov.uk. In March 2011, SPS awarded a contract to G4S and Justice Services (UK) Ltd. The contract commenced in January 2012. The contract itself covers a range of prisoner transport and security related services which are delivered to a number of agencies, namely: > SPS; > Scottish Court Service; > Police Scotland; and > The State Hospital and other NHS secure Units.

2017-18 2016-17 Public Private Public Private Prisons Prisons CCPES Total Prisons Prisons CCPES Total £000 £000 £000 £000 £000 £000 £000 £000 Net operating cost 270,827 36,999 23,399 331,225 272,578 36,323 22,137 331,038 Non-current assets 1,007,618 133,719 2,049 1,143,386 944,769 125,051 3,363 1,073,183

NOTES TO THE ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX TO THE ACCOUNTS

SCOTTISH PRISON SERVICE

DIRECTION BY THE SCOTTISH MINISTERS

in accordance with section 19(4) of the Public Finance and Accountability (Scotland) Act 2000

1. The statement of accounts for the financial year ended 31 March 2006 and subsequent years shall comply with the accounting principles and disclosure requirements of the edition of the Government Financial Reporting Manual (FReM) which is in force for the year for which the statement of accounts are prepared.

2. The accounts shall be prepared so as to give a true and fair view of the income and expenditure, recognised gains and losses, and cash flows for the financial year, and of the state of affairs as at the end of the financial year.

3. This direction shall be reproduced as an appendix to the statement of accounts. The direction given on 29 March 2001 is hereby revoked.

Signed by the authority of the Scottish Ministers

Dated 17 January 2006

NOTES TO THE ACCOUNTS 83

APPENDICES

NOTES TO THEAPPENDICES ACCOUNTS SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 1 LOCATION OF ESTABLISHMENTS

Scotland’s Prisons 01 Addiewell 09 Greenock 02 Barlinnie 10 Headquarters 03 Castle Huntly 11 Inverness 04 Cornton Vale 12 Kilmarnock 05 Dumfries 13 Low Moss 06 Edinburgh 14 Perth 07 Glenochil 15 Polmont 08 Grampian 16 Shotts

11 08

14 03

04 07 13 15 10 02 09 01 06 16

12

05

APPENDIX 1 85

APPENDIX 2 AVERAGE DAILY POPULATION AND MAXIMUM NUMBER BY PENAL ESTABLISHMENT: 2017-18

AVERAGE DAILY POPULATION1 MAXIMUM NUMBER2

Male Female Total Male Female Total Adults Addiewell 696 - 696 702 - 702 Barlinnie 1,126 - 1,126 1,195 - 1,195 Cornton Vale - 84 84 1 96 96 Dumfries 172 - 172 180 - 180 Edinburgh 776 96 872 818 108 913 Glenochil 641 - 641 667 - 667 Grampian 401 44 445 424 51 474 Greenock 194 54 248 202 57 257 Inverness 110 * 110 137 1 137 Kilmarnock 499 - 499 509 - 509 Low Moss 757 - 757 778 - 778 Open Estate 189 - 189 220 - 220 Perth 617 - 617 654 - 654 Polmont 51 80 131 66 90 Shotts 531 - 531 540 - 540 Young Offenders Institutions3 Barlinnie 1 - 1 2 - - Cornton Vale - 2 2 - 5 - Grampian 1 3 4 4 5 - Polmont 331 8 339 367 13 522 Total 7,093 371 7,464 7,187 384 7,564

Source: Notes:

Data is based on the Scottish Prison 1. Components may not add to totals due 2. The figures in these columns cannot Service PR2 information management to rounding. be added to produce a total maximum system archived aggregate tables. number as the individual establishment Figures published prior to 2012-13 were figures relate to different days during from datasets managed by Scottish the year. Government Justice Analytical Services, but it has not been possible to replicate this analysis since 2011-12 due to on- going technical issues. The most notable difference between the two data sources is that the figures shown in this annual report do not include prisoners classified as unlawfully at large.

APPENDIX 2 SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 3 AVERAGE DAILY POPULATION IN ESTABLISHMENTS BY TYPE OF CUSTODY: 2017-18

Remand: sub total 1,358 Persons under sentence: sub total Under four years 3,221 Four years and over (including life sentences and lifer recalls) 2,882 Total 7,461

Source: Notes:

Data is based on the Scottish Prison Components may not add to totals due to Service PR2 information management rounding. Remand figures include a small system archived aggregate tables. Figures number of persons awaiting deportation published in annual reports prior to 2012- as these are classified as untried on 13 were based on datasets managed by PR2. The way the data are held on the Scottish Government Justice Analytical PR2 aggregate tables does not allow an Services, but it has not been possible to accurate breakdown by sentence and age. replicate this analysis since 2011-12 due to on-going technical issues. The most notable difference between the two data sources is that the figures shown in this annual report do not include prisoners classified as unlawfully at large. The classification of long-term determinate prisoners recalled from licence is also different between the two data sources: these are classified as long-termers in the Scottish Government statistics as they are still subject to parole procedures. On PR2, these prisoners will be classified as short-termers if the recalculated sentence on recall is less than four years.

APPENDIX 3 87

APPENDIX 4 ABSCONDS AND FAILURES TO RETURN 2017-18

Absconds and Failures to Return – 2017-18

Barlinnie Cornton Vale Greenock Open Estate Polmont Total

Abscond 1 0 0 1 0 2

Failure to Return 0 0 1 9 0 10

APPENDIX 4 SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 5 BREACHES OF DISCIPLINE AND OUTCOME IN PENAL ESTABLISHMENTS BY SEX AND AGE: 2017-18

Adults Young Offenders All Male Female Male Female Male Female Average daily population 6,760 358 333 13 7,185 366 Breaches of discipline Disobeying a lawful order 4,439 242 368 4 4,807 246 Possessing an unauthorised/prohibited article/quantity of an article 3,693 301 298 2 3,991 303 Using threatening/abusive/insulting word s or behaviour 2,111 281 164 3 2,275 284 Fighting 1,240 128 328 1 1,568 129 Destroying or damaging property 1,024 58 317 9 1,341 67 Administering, or allowing to be administered, a controlled drug to oneself 899 84 47 – 945 84 Assault 898 100 207 2 1,105 102 Intentionally or recklessly endangering the health or personal safety of others 466 39 58 1 524 40 Disobeying a rule or regulation 317 63 13 – 330 63 Unauthorised absence from or presence in any part of the establishment 425 8 51 – 476 8 Intentionally refusing to work or failing to work properly 224 10 24 – 248 10 Smoking in an area where smoking is not permitted 270 40 18 – 288 40 Consuming/taking/injecting/ingesting/inhaling or concealing an unauthorised or prohibited substance 606 18 12 – 618 18 Taking (improperly) any article 102 16 3 – 105 16 Intentionally obstructing any person, other than a prisoner, in the course of their work 104 11 36 – 140 11 Sale or delivery of an unauthorised article 113 14 4 – 117 14 Arson 64 7 48 – 112 7 Being disrespectful to any officer, worker or visitor 63 10 4 1 67 11 Sale or delivery of an article allowed only for prisoners' own use 36 10 2 – 38 10 Committing an indecent or obscene act 70 10 3 – 73 10 Failing to return from temporary release or comply with a condition of such release 37 3 – – 37 3 Denying an officer access to any part of the prison 8 – – – 8 – Failing without reasonable excuse to open mouth for a visual examination 12 3 1 1 13 4 Escaping or absconding from custody 4 – 2 – 6 – Attempting/inciting/assisting to commit/attempt to commit any of the above 186 9 23 – 209 9 Breaches of discipline: total 17,411 1,465 2,030 24 19,441 1,489 Punishments awarded Forfeiture of privileges 15,706 814 2,042 14 17,748 828 Stoppage/deduction from earnings or other cash 12,128 675 1,871 3 13,999 678 Caution 1,834 135 94 1 1,928 136 Confinement to cell 1,476 156 291 4 1,767 160 Forfeiture of other entitlements 241 31 2 – 243 31 Punishments awarded: total 31,385 1,811 4,300 22 35,685 1,833 Breaches of discipline per head of average prison population 3 4 6 2 3 4

Source: Data is derived from the Scottish Prison Service PR2 information management system archived aggregate tables. Notes: It is possible for more than one punishment to be awarded for one breach of discipline, and conversely one punishment may be given for several breaches of discipline. Components may not add to total due to rounding. Changes to prison rules were implemented during 2012, headings may therefore differ slightly from previous years. Headings have been reordered and some have been combined in the interests of clarity.

APPENDIX 5 89

APPENDIX 6 STAFF IN POST

As at 31 March 2018 there were 4,549 staff in post. Staff in Post – This table details the gender, employment type and disability spilt for the organisation. Employees in Post - Disabled As at March 2018 Total Full-time Part-time (self-declared) Female 1,374 1,196 178 109 Male 3,175 2,858 317 276

SPS Board (which includes senior civil servants within SPS) – This table reflects the gender spilt for SPS Board Members as at 31/03/2018. Non-Executive As at March 2018 Chief Executive Directors Directors Total Female 0 3 2 5 Male 1 2 2 5

Staff in Post: Age Groups – This table details the gender split by age group for the organisation. As at March 2018 16-24 25-34 35-44 45-54 55-64 Over 65 Total Female 105 499 300 338 129 3 1,374 Male 77 572 435 1,254 796 41 3,175

Staff in Post: Ethnicity – This table details the ethnicity indicated by the staff within SPS. Where the ethnicity group has less than 5 members this has been shown as “<5” to ensure compliance with the Data Protection Act. As at March 2017 Ethnicity Total Arab Scottish <5 Asian Other <5 Bangladeshi <5 Black African 5 Black Other <5 British African <5 British Asian Other <5 British Pakistani <5 Indian <5 Mixed Other <5 Mixed White and Asian <5 Mixed White and Black Caribbean <5 Not Advised 2,363 Other Ethnic Group <5 Pakistani <5 Prefer not to Disclose 484 Scottish Pakistani <5 White 456 White English 80 White Gypsy Traveller <5 White Irish 11 White Northern Irish 17 White Other 11 White Polish <5 White Scottish 1,094 White Southern Irish <5 White Welsh <5

APPENDIX 6 SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 6 (cont’d)

STAFF IN POST

Leavers: Age Groups – This table details the gender split by age group for the organisation for all employees who have left the organisation in the 12 month period 01/04/2017 to 31/03/2018. As at March 2018 16-24 25-34 35-44 45-54 55-64 Over 65 Total Female 8 22 17 14 18 0 79 Male 8 39 16 20 78 22 183

Recruitment – This table details the gender split, ethnic group, disability declarations and non-full time employments types for all employees who have joined the organisation in the 12 month period 01/04/2017 to 31/03/2018. Appointed Disabled Part-time/ 2017-2018 Male Female Ethnic Origin (self-declared) Job share 246 123 123 Bangladeshi <5 5 34 Mixed White and Asian <5 Not Advised 216 Prefer not to Disclose <5 White 6 White English <5 White Scottish 17

Recruitment: Age Groups – This table details the gender split by age group for the organisation for all employees who have joined the organisation in the 12 month period 01/04/2017 to 31/03/2018.

As at March 2018 16-24 25-34 35-44 45-54 55-64 Over 65 Total

Female 36 50 14 16 7 0 123

Male 26 51 17 15 11 3 123

Exceptions – This table details all appointments of staff which fell outside our standard recruitment process. That is they were classified as not being appointed under open and fair competition.

Temporary Appointments Re-appointment of Former Civil Servants 4 3

There were no exceptions in the following Categories: Schemes for Unemployed and Disabled People; Organisations transferred in (Non-TUPE) Extended Ministerial Offices; Organisations transferred in (TUPE) Northern Ireland Civil Servants; Conversion to Permanency Staff from other Public Bodies

APPENDIX 6 91

APPENDIX 6 (cont’d)

STAFF IN POST

Promotion – This table details the gender split, ethnic group, disability declarations and non-full time employments types for all employees who were promoted within the organisation in the 12 month period 01/04/2017 to 31/03/2018. The following personnel were promoted: Promoted Disabled Part-time/ 2017-2018 Female Male Ethnic Origin (self-declared) Job Share 86 47 39 Black African <5 <5 0 Not Advised 47 Prefer not to Disclose 7 White 7 White English <5 White Irish <5 White Polish <5 White Scottish 20

APPENDIX 7 SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 7 PARLIAMENTARY ACCOUNTABILITY (1 April 2017 – 31 March 2018)

Ministerial Correspondence

No. of Replies issued No. of Replies issued Category of Response No. Received within 15 working days outwith target date

MSP’s letters for Ministerial reply 8 8 0

MSP’s letters for Chief Executive reply 79 74 5

Total (2017-18) 87 82 (94%) 5 (6%) Total (2016-17) 99 97 (98%) 2 (2%)

Scottish Parliamentary Questions

Year Total Ministerial Replies Chief Executive’s Replies

Year ended 31 March 2018 43 0 43 Year ended 31 March 2017 79 0 79

APPENDIX 7 93

APPENDIX 8a KEY PERFORMANCE INDICATORS*

2017-18 2016-17 KPI1a Extreme Risk Escapes 0 0 KPI1b Escapes at other supervision level 1 0 KPI2a Serious Prisoner on Staff Assaults 14 5 KPI2b Minor and No Injury Prisoner on Staff Assaults 283 193 KPI2c Serious Prisoner on Prisoner Assaults 94 74 KPI2d Minor and No Injury Prisoner on Prisoner Assaults 2,173 2,136 KPI3a Purposeful Activity Hours 6,500,472 6,785,800 KPI3b Average Purposeful activity Hours per week per Convicted prisoner 21 22 KPI4a % of education classes spent delivering literacy skills 37.6% 37.5% KPI4b % of education classes spent delivering numeracy skills 17.3% 17.0% KPI5a Vocational and Employment Related Qualifications 18,793 20,311 KPI5b Vocational and Employment Related Qualifications at SCQF level 5 or above 1,976 2,465 KPI6 Employability Prospects Increased - - KPI7 Reduced Substance Abuse - 46 KPI8 % of ICM Case Conferences with CJSW in attendance 88% 89.8% KPI9 Average Annual Cost Per Prisoner Place** 35,293 35,325 KPI10 Reducing Carbon Emissions*** - -

* An explanation of Operational Performance Indicators is shown at Appendix 8b. **The average cost per prisoner place excludes capital charges, exceptional payments and the cost of the Court Custody and Prisoner Escort Contract. SPS publishes cost and performance information on the latter separately on its website. ***A separate report is published on our website www.sps.gov.uk.

APPENDIX 8a SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 8b WHAT DO THE OPERATIONAL PERFORMANCE INDICATORS MEAN?

Related National Key Outcomes KPI Definition Related National Outcomes Indicators SPS maintains secure custody and good order

We live our lives safe a) Extreme risk. b) All other supervision levels. Reduce re-conviction from crime, disorder 1. Escapes and danger. c) Absconds. rates d) Incidents of failure to return. Our public services a) Serious prisoner on staff assaults. are high quality, b) Serious prisoner on prisoner continually improving, assaults. Reduce re-conviction 2. Assaults efficient and c) Other prisoner on staff assaults. rates responsive to local d) Other prisoner on prisoner people’s needs. assaults. SPS cares for prisoners with humanity and offers them appropriate opportunities We realise our full economic potential Reduce reconviction Any supervised and/or structured with more and better employment rates. Improve levels of 3. Purposeful activity that contributes to reducing opportunities for our people. Educational attainment. Activity Hours re-offending. Increase Physical We live our lives safe We are better educated, more Activity from crime, disorder skilled and successful, renowned for and danger. our research and innovation. a) The percentage of prisoner Our public services learning hours delivered with a Our young people are successful are high quality, primary aim of developing literacy learners, confident individuals, continually improving, 4. Increase in skills. effective contributors and responsible Reduce reconviction efficient and Literacy and citizens. rates. Improve levels of responsive to local Numeracy b) The percentage of prisoner We live longer, healthier lives. Educational attainment. people’s needs. learning hours delivered with a primary aim of developing We have improved the life chances numeracy skills. for children, young people and families at risk. SPS maintains secure custody and good order

a) Number of vocational and Reduce reconviction employment-related qualifications. rates. Improve levels of 5. Vocational We realise our full economic Educational attainment. qualifications b) Number of vocational and employment-related qualifications potential with more and better Improving the skill profile at SCQF level 5 or above. employment opportunities for our of the population. people. We live our lives safe The percentage of prisoners accessing JobCentre Plus’ We are better educated, more Reduce reconviction from crime, disorder 6. Increase in pre-release service who move into skilled and successful, renowned for rates. Improving the skill and danger. employability employment, education or training our research and innovation. profile of the population. Our public services within 13 weeks of release. are high quality, Our young people are successful Reduce reconviction continually improving, 7. Reduced or The number of prisoners testing learners, confident individuals, rates. Reducing the efficient and stabilised drug positive on entry compared with the effective contributors and number of individuals responsive to local misuse number testing positive on exit. responsible citizens. with problem drug use. people’s needs We live longer, healthier lives. 8. Integrated Case The percentage of case conferences Management We have improved the life chances held for prisoners to be released to Reduce reconviction case for children, young people and Scotland where the community rates. Reducing crime conferences families at risk. Criminal Justice Social Worker victimisation rates. with social work attended. contributions SPS offers value for money to the taxpayer Our public services are high quality, 9. Average annual Improve people’s continually improving, cost per perceptions of the efficient and prisoner place quality of public services. responsive to local people’s needs. We value and enjoy our From 2010, a 20% reduction in Reduce Scotland’s built and natural 10. Reducing carbon emissions by 2015 with We reduce the local and global Carbon Footprint. environment and Carbon anticipated savings over the 5 year environmental impact of our protect it and enhance Emissions plan equating to 45,335 tonnes of consumption and production. Reduce waste it for future CO2, and £8.1m. generated. generations.

APPENDIX 8b 31

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APPENDIX 1

NationalAPPENDIX 9Performance Framework with SPS Strategic Themes, NATIONAL PERFORMANCE FRAMEWORK WITH SPS STRATEGIC THEMES, OUTCOMES AND OutcomesOPERATIONAL PERFORMANCE and Operational INDICATORS Performance Indicators

SCOTTISH PURPOSE • To focus government and public services on creating a more GOVERNMENT successful country, with opportunities for all of Scotland to flourish, through increasing sustainable economic growth

JUSTICE IN VISION • A just, safe & resilient Scotland SCOTLAND: VISIONS AND PRIORITIES

NATIONAL • We live our lives safe from crime, disorder and danger OUTCOMES • We have strong resilient and supportive communities where people take responsibility for their own actions and how they affect others • Our public services are high quality, continually improving, efficient and responsive to local people’s needs

JUSTICE • We live in safe, cohesive and resilient communities OUTCOMES • Prevention and early intervention improve wellbeing and life chances • Our system and interventions are proportionate, fair and effective • We deliver person-centred, modern and affordable public services

PRIORITIES • We will enable our communities to be safe and supportive, where individuals exercise their rights and responsibilities • We will enable our people, economy and infrastructure to respond to major risk, recover from emergencies and adapt to emerging threats • We will modernise civil and criminal law and the justice system to meet the needs of people in Scotland in the 21st Century • We will work with others to improve health and wellbeing in justice settings, focusing on mental health and substance use • We will work to quickly identify offenders and ensure responses are proportionate, just, effective and promote rehabilitation • We will improve the experience of victims and witnesses, minimising court attendance and supporting them to give best evidence • We will use prison only where necessary to address offending or to protect public safety, focusing on recovery and reintegration

SPS STRATEGY VISION • Help build a safer Scotland - Unlocking Potential - Transforming Lives

MISSION • Providing services that help to transform the lives of people in our care so that they can fulfil their potential and become responsible citizens

STRATEGIC THEME PROFESSIONALISM PARTNERSHIP PURPOSE GOVERNANCE

STRATEGIC OUTCOME Unlocking Unlocking Transforming Our services are Potential: We will Potential: Our Lives: Our efficient, effective have the right collaboration with communities are and provide value people, with the partners results in safer because for money. right skills, in the enhanced service those citizens right place, at provision and in our care are the right time. better personal supported to build outcomes for those on their assets citizens in and and return to their leaving our care. communities as productive citizens.

SPS OPERATIONAL PERFORMANCE INDICATORS

APPENDIX 1

APPENDIX 9 SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

APPENDIX 10 COURT CUSTODY AND PRISONER ESCORT SERVICE

CORE VOLUMES (Excluding Bail to Establishment)

Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 2017-18 2016-17 Total Total

Police Station to Court 5,138 5,841 5,574 5,658 5,689 5,113 5,489 4,982 4,786 4,945 3,816 4,054 61,085 71,171

Prison to Court 3,331 3,836 3,765 3,341 4,001 3,437 3,691 3,599 3,207 3,752 3,290 3,393 42,643 46,874

Mental Health Hospitals 56 60 57 50 64 46 52 58 59 54 58 65 679 697 to Court

Court Others 243 268 276 242 286 250 263 273 231 240 270 264 3,106 3,427

Total Core Services 8,768 10,005 9,672 9,291 10,040 8,846 9,495 8,912 8,283 8,991 7,434 7,776 107,513 122,169

Total External Services 1,700 1,730 1,765 1,658 1,857 1,799 1,783 1,952 1,223 1,574 1,688 1,755 20,484 23,588

Total Core Volume 10,468 11,735 11,437 10,949 11,897 10,645 11,278 10,864 9,506 10,565 9,122 9,531 127,997 145,757

Total Non Core Volume 1,302 1,452 1,478 1,333 1,543 1,373 1,495 1,523 1,359 1,520 1,409 1,427 17,214 17,510

Total Movements 11,770 13,187 12,915 12,282 13,440 12,018 12,773 12,387 10,865 12,085 10,531 10,958 145,211 163,267

% delivered to court 92% 91% 91% 88% 91% 91% 91% 91% 92% 90% 93% 92% 91% 90% on time

Number of Prisoners 0 0 0 2 1 0 1 0 1 1 0 0 0 10 Unlawfully at Large

APPENDIX 10 97

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NOTES SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

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NOTES SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

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SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-2018

Scottish Prison Service Headquarters Calton House 5 Redheughs Rigg South Gyle Edinburgh EH12 9HW SCOTTISH PRISON SERVICE ANNUAL REPORT & ACCOUNTS 2017-18

Presented to the Scottish Parliament in pursuance of the Prisons (Scotland) Act 1989

Laid before the Scottish Parliament by the Scottish Ministers

July 2018 SG/2018/119

© Crown copyright 2018 ISBN: 978-1-78851-911-3 This document is also available from our website www.sps.gov.uk Published on behalf of the Scottish Prison Service by APS Group, June 2018