Annual Accounts 2024-25

Corporate Governance Report

This section contains the Directors’ Report, the Statement of Accountable Officer’s Responsibilities and the Governance Statement.

Directors’ Report

The Commissioner

I was appointed SRWC on 9 November 2020 for a five year term, my appointment was extended by an additional two years in 2024/25

Equal Opportunities, Diversity and Human Rights

The Commissioner is committed to continued compliance with the Public Sector Equality Duty as set out in the Equality Act 2010 and the Equality & Human Rights Commission’s Code of Practice and supports the principles of equal opportunities in carrying out operational functions and employment practices. The Commissioner is committed to pursuing positive action in the organisation’s policies and practices to ensure that no individual is discriminated against, either directly or indirectly, unlawfully or unjustifiably because of their personal status in relation to race, ethnic or national origin, religion, age, gender, sexual or marital status, or disability.

Pension Liabilities

Pensions and their associated benefits are provided through the Civil Service pension arrangements and administered for the Commissioner by the Scottish Government. Further information is included in Note 3 of the Accounts.

Register of Interests

The Commissioner publishes a Register of Interests. This is updated as required and reviewed annually. The register only details staff who have made disclosures. Where no disclosure has been made, there is no entry in the register for the staff member and this is clearly identified on the register. The current copy of declared interests is published on the Commissioner’s website along with the Code of Conduct for the Commissioner’s office.

The Register of Interests can be found in the following location:

Register of Interests 2024/25 

The Code of Conduct will be published on the SRWC website in Publications – Operational Information.

Code of Conduct

Auditors

The SRWC Accounts are audited by auditors appointed by the Auditor General for Scotland in accordance with paragraph 2(b) of Schedule 2 of the Transport (Scotland) Act 2005. Audit Scotland were appointed for a period of 5 years, commencing with the 2022/23 Accounts, under powers conferred by the Public Finance and Accountability (Scotland) Act 2000. External audit remuneration fees of £18,530 are reflected in the accounts. Audit Scotland receive no fees in relation to non-audit work.

Provision of Information to Employees

The Scottish Road Works Commissioner has adopted the principles of openness and participation in the office and places a high level of importance on both informing and consulting staff. The Commissioner does so by providing access to management papers, through oral and written briefings, by regular staff meetings and events. Information is only withheld where this can be shown to be justified or where a duty of confidence is owed to a third party.

Personal Data Incidents

There were no personal data incidents during 2024/25.

Payment of Creditors

The Scottish Road Works Commissioner adopts Scottish Government policies and procedures in relation to the payment of suppliers. In 2024/25: 95.3% (2023/24: 85.1%) of supplier invoices were paid within 10 days of receipt.

Significant Events Since the End of the Financial Year

There have been no significant events since the end of the financial year which require revision to the figures disclosed in the annual accounts under the terms of IAS 10: Events after the Reporting Period. In accordance with the requirements of IAS 10, events are reviewed and considered up to the date on which the accounts are authorised for issue. This is interpreted as the date on which the Independent Auditor’s Report is signed.

Statement of Accountable Officer’s Responsibilities

The Scottish Government designated the Scottish Road Works Commissioner as the Accountable Officer for the office of the Scottish Road Works Commissioner. The relevant responsibilities as Accountable Officer, including the responsibility for the propriety and regularity of the public finances, for the keeping of proper records and for safeguarding the Commissioner’s assets, are set out in the Memorandum to Accountable Officers of Other Public Bodies issued by the Scottish Government and published in the Scottish Public Finance Manual.

Under Paragraph 2(a) Schedule 2 of the Transport (Scotland) Act 2005, the Scottish Ministers have directed the Commissioner to prepare a statement of accounts for each financial year in the form and on the basis set out in the Accounts Direction. The accounts are prepared on an accruals basis and must give a true and fair view of the state of affairs of the Commissioner and of income and expenditure, recognising gains and losses and cash flows for the financial year.

In preparing the accounts, the Scottish Road Works Commissioner is required to comply with the requirements of the Government Financial Reporting Manual and the Scottish Public Finance Manual, with particular reference to:

1. Observing the Accounts Direction issued by Scottish Ministers (see Annex 1), including the relevant accounting and disclosure requirements, and applying accounting policies on a consistent basis;
2. Making judgements and estimates on a reasonable basis;
3. Stating whether applicable accounting standards as set out in the Government Financial Reporting Manual have been followed and disclosing and explaining any material departures in the financial statements; and
4. Preparing the accounts on a “going concern” basis.

I confirm that, as far as I am aware, there is no relevant audit information of which Audit Scotland are unaware, and that as Accountable Officer, I have taken all the steps I ought to have taken to make myself aware of any relevant audit information and to establish that Audit Scotland are aware of that information.

I confirm that the annual report and accounts as a whole is fair, balanced and understandable and that I take personal responsibility for the annual report and accounts and the judgments required for determining that it is fair, balanced and understandable.

As Accountable Officer, I am responsible for the regularity and propriety of the public finances received from the Scottish Government and the collected “Prescribed Fees and Amounts”. In addition, I am required to keep proper records and to safeguard SRWC assets, all as set out in the Accountable Officer’s Memorandum issued by Scottish Ministers.

Governance Statement

As Accountable Officer, I have responsibility for putting in place and maintaining sound systems of governance and internal control that support the delivery of the office policies, aims and objectives. As noted in the “Statement of Accountable Officer’s Responsibilities” above, I am required to safeguard public funds and assets in accordance with the responsibilities assigned to me and for which I am personally responsible.

The Scottish Public Finance Manual (SPFM) is issued by the Scottish Ministers to provide guidance to the Scottish Government and other relevant bodies on the proper handling and reporting of public funds. It sets out the relevant statutory, parliamentary and administrative requirements, emphasises the need for economy, efficiency and effectiveness and promotes good practice and high standards of propriety.

Governance Arrangements

In 2010, the Scottish Government sponsor unit agreed that given the independent status and the budget of the Office, the Commissioner would operate without an audit committee or advisory board. It was also agreed that the topic should be kept under review and that should any practical difficulties arise, that governance arrangements would be reviewed. I can confirm that no practical difficulties have arisen.

The agreement that the office of the Scottish Road Works Commissioner would operate without an audit committee or advisory board was taken based on the following arrangements being in place to give assurance that there are adequate controls:

• an annual audit is undertaken by an independent auditor;
• audited annual accounts are published;
• the SRWC continues to utilise Scottish Government processes and procedures as much as possible;
• the SRWC continues to utilise Scottish Government services such as SCOTS, pensions and payroll;
• the SRWC meets regularly with the Scottish Government sponsor unit; and an internal audit is undertaken at appropriate intervals.

It was agreed in 2010 that given the reliance that the SRWC places on Scottish Government processes and systems, that internal audit of the office would form part of the Transport Scotland risk based plan for internal audit. As such internal audit is provided by Scottish Government and considered annually as part of the Transport Scotland audit planning process. This includes an advisory service on risk, control and governance and, where required, provide advice on urgent work where there are specific needs or problems.

Internal Control

The system of internal control is designed to manage rather than eliminate the risk of failure to achieve the Commissioner‘s aims and objectives. It can therefore only provide reasonable, not absolute assurance of effectiveness.

The process within the organisation accords with the guidance from the Scottish Ministers provided in the Scottish Public Finance Manual and has been in place for the year ended 31 March 2025 and up to the date of approval of the Annual Accounts.

The system of internal control is based on an on-going process designed to identify principal risks to the achievement of the organisation’s policies, aims and objectives. It evaluates the nature and extent of those risks and manages them efficiently, effectively and economically.

Significant risks affecting the organisation are associated with the Scottish Road Works Register, External Factors and Financial Loss.

Specific issues considered in compiling the office Risk Register, which could result in both financial and reputational loss to the organisation, include, or are informed by the following:

• The risk that the SRWR provider enters into financial difficulty resulting in the total loss of the register. The SRWC is "the keeper" of the SRWR which is provided by a private company. Mitigation measures have been put in place to reduce the severity and likelihood of this risk to the SRWC. In the event of total loss, the minimum requirements are set out by legislation and the SRWC would initiate these via a paper notices process. An emergency tender process would be initiated to find a new supplier.
• The risk that external issue(s) increase SRWC costs above agreed budget. Spending is closely monitored, however specific mitigation measures have been put in place to reduce the severity and likelihood of this risk to the SRWC. The Framework Document between Transport Scotland and the SRWC makes provision to amend the Grant in Aid payment profile to respond to business needs. Spending and risks are monitored on a monthly basis. An example of an external risk is the impact on the office of the provisions of the Transport (Scotland) Act 2019.
• The risk that a member of staff could undertake fraudulent activity, resulting in significant financial loss for the SRWC. Mitigation has been put in place to reduce the severity and likelihood of this risk. Signatories to the accounts have been restricted and current banking arrangements restricts payments to £100k. Further mitigation has been applied with only the Commissioner being able to authorise final payment. The SRWC has a small team and is therefore able to monitor this closely. The SRWC holds monthly meetings to review accounts.

Further details of all risks assessed and mitigation measures are detailed in the SRWC’s Risk Register.

I confirm that, in my opinion, the control arrangements are appropriate and effective and that no significant issues have been identified.

I confirm that I remain content with the financial and HR support provided by the Scottish Government and that the 2024/25 Annual Assurance Statement was submitted to the Cabinet Office on 16 June 2025.

Risk Management

All bodies to which the Scottish Public Finance Manual is directly applicable must operate a risk management strategy in accordance with relevant guidance issued by the Scottish Ministers. The general principles for a successful risk management strategy are set out in the SPFM.

The Risk Register is reviewed on a bi-annual basis. The Commissioner and staff regularly consider risk in respect of specific issues, all staff have completed risk management training. As new risks emerge or existing risks change, adjustments are made to the SRWC Risk Register.

The Business Continuity Plan is reviewed to reflect staff and legislation changes, and any other issues which would have an impact on the continued operation of the office. A major review of the Business Continuity Plan was undertaken in 2023/24. This included validating the plan by completing a number of exercise scenarios. A review is completed annually, as well as conducting a business review whenever there is a change within the organisation.

By doing this, it ensured that staff know their roles and responsibilities in the event of an unexpected incident and how to respond following agreed procedures. This will allow for the most important functions and systems critical to the Scottish Road Works Commissioner to be up and running in the shortest possible time frame.

Reviews of the Risk Register and Business Continuity Plan take account of any changes required due to advice from professional advisors or the result of internal and external audit.

The Commissioner is committed to a process of continuous development and improvement, responding to any relevant reviews and identified best practice.

The Commissioner will continue to be guided by the Scottish Public Finance Manual.

Data Security

There have been no lapses in data security for the period ending 31 March 2025.

Review of Effectiveness of Internal Controls

As Accountable Officer I have responsibility for reviewing the effectiveness of internal controls. My review of the effectiveness of internal controls in place during the 2024/25 financial year was informed by:

• Certificates of Assurance returned by team members on completion of an Internal Control checklist
• The staff within the office who have responsibility for the development and maintenance of the internal control framework
• Consideration of the matters which arose during preparation of the 2024/25 accounts
• Comments made by the external auditors
• The Scottish Public Finance Manual and Financial Reporting Manual

Appropriate action is in place to address any weaknesses identified and to improve the effectiveness of internal controls.

Significant Issues

I confirm that there are no significant issues to report for the 2024/25 period.

Remuneration and Staff Report

Remuneration Report (Audited)

Commissioner appointments are generally for a period of 5 years. Kevin Hamilton was appointed as Commissioner on 9 November 2020. The Commissioner’s appointment was extended by an additional two years in 2024/25. The remuneration policy used within the SRWC is in line with the Scottish Government pay policy.

The salary and pension entitlements of Kevin Hamilton during the 2024/25 financial year and the median pay disclosure are subject to audit and are set out below.

Remuneration

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Salary disclosures reflect the requirements of the Government Financial Reporting Manual (the FReM).

Given the independent nature of the office, the Commissioner is not part of a bonus scheme, nor does the post have any reserved rights, recruitment, or retention allowances.

Pay multiples

The highest paid Director had banded remuneration of £85,000-£90,000 in 2024/25 (2023/24 £80,000-£85,000). There has been an increase of 6.1% based on the mid-point of the salary band.

In the reporting year, the average remuneration in respect of the employees taken as a whole was £48,667 (2023/24 £45,888). This year’s report figure is a percentage increase of 6.06%. The range of remuneration in the Scottish Road Works Commissioner in the financial year 2024/25 in bands of £5k was between £35k-£40k to £85k-£90k. (2023/24 £35k-£40k to £80k-£85k). These remuneration figures exclude pension benefits.

*The 2023/24 average salary figure has been restated due to a re-calculation.

The pay ratio information is shown in the table below:

The ratio of the salary of the highest paid director to the median remuneration of the organisation’s workforce in 2024/25 has remained broadly the same as the previous year.

In 2024/25, no employees received remuneration in excess of the annualised salary of the highest-paid director (2023/24: £nil). Remuneration includes basic salaries and overtime. It does not include employer national insurance or pension contributions.

*The 2023/24 percentile figures have been restated due to a re-calculation.

Benefits in Kind

The Commissioner received no benefits in kind over the reporting period 2024/25 (2023/24: £nil)

Pension Benefits

The Cash Equivalent Transfer Value (CETV)

A Cash Equivalent Transfer Value (CETV) is the actuarially assessed capitalised value of the pension scheme benefits accrued by a member at a particular point in time. The benefits valued are the member’s accrued benefits and any contingent spouse’s pension payable from the scheme. A CETV is a payment made by a pension scheme or arrangement to secure pension benefits in another pension scheme or arrangement when the member leaves a scheme and chooses to transfer the benefits they have accrued in their former scheme.

The pension figures shown relate to the benefits that the individual has accrued as a consequence of their total membership of the pension scheme, not just their service in a senior capacity to which disclosure applies. The figures include the value of any pension benefit in another scheme or arrangement which the member has transferred to the Civil Service pension arrangements. CETVs are worked out in accordance with The Occupational Pension Schemes (Transfer Values) (Amendment) Regulations 2008 and do not take account of any actual or potential reduction to benefits resulting from Lifetime Allowance Tax which may be due when pension benefits are taken.

The Real Increase in the Value of CETV

This reflects the increase in CETV effectively funded by the employer. It does not include the increase in accrued pension due to inflation, contributions paid by the employee (including the value of any benefits transferred from another pension scheme or arrangement) and uses common market valuation factors for the start and end of the period.

Staff Report

Number of senior staff by band

The Commissioner was remunerated at Band C3 (£85,400 – £87,404) April 2024 to March 2025 (2023/24 C3 £83,328 - £84,858).

Staff Numbers Employed (Audited)

The average number of full time equivalent (FTE) staff employed by the Scottish Road Works Commissioner during the period was as follows:

All staff are subject to UK Employment Contracts.

Staff Costs (Audited)

The total remuneration for 2024/25 has increased by £98k due to pay increase in line with Scottish Government (SG) Public Sector Pay policy and two additional team members recruited in Q4 of 2023/24.

Staff Composition

The following table shows the breakdown by gender of the staff employed within the Commissioner’s office and who were in post on 31 March 2025.

Sickness Absence Data

The staff sickness absence rate in the Commissioner’s office was 1.7% 2024/25 (2023/24 1.2%).

During the period ended 31 March 2025 the SRWC recorded 12 days of sickness absence this is an average of 1.7 days per employee. The Civil Service sickness absence report for 2024/25, indicates that the average working days lost per Civil Service employee was 7.8 days. The SRWC has decided to set a target for sickness absence through his Business Plan. This will set at a level lower than the civil service average.

Staff Turnover

The staff turnover rate was 12.9% in 2024/25 (2023/24: 0%). Overall staff retention remains high despite one retirement in 2024/25.

Trade Union Facility Time

There were no trade union members in the SRWC in 2024/25 (2023/24: Nil)

Expenditure on Consultancy

Legal Support
Over the reporting period the SRWC continued to engage Anderson Strathearn Solicitors to provide legal support. Expenditure on external legal support during 2024/25 was £7170 (2023/24 £16,544).

Accountancy Support
During 2024/25, expenditure on external accountancy support was £2,120 (2023/24 £1,500).

Staff policies

The Scottish Road Works Commissioner is committed to following current Scottish Government policy with respect to applications for employment, continuing employment, training and career development.

In line with Scottish Government’s recruitment procedures, the Commissioner gives full and fair consideration to applications for employment made by disabled persons, having regard to their particular aptitudes and abilities. In addition, the Commissioner’s current remuneration policy reflects Scottish Government policy.

Off-payroll engagements

There were no off-payroll engagements during 2024/25 (2023/24 – none).

Exit Packages (Audited)

There were no exit packages during the reporting period (2023/24 – none).

Parliamentary Accountability Report

Fees and Charges

The SRWC collects Prescribed Fees and Amounts from utility companies and roads authorities in respect of the provision of the Scottish Road Works Register. Total income collected £911k (2023/24 £973k) Income received from activities is summarised in Note 2.

Accountability Report

Kevin Hamilton

Scottish Road Works Commissioner and Accountable Officer

Date: