Since the Scottish Government announced a series of proposals for public service reform in the Programme for Government 2026-31 on 1 September, there has been a flurry of interest, further announcements and scrutiny.
This blog is the first in a series which aims to offer periodic updates on what is happening the in the public service reform landscape.
Local Government reform
Our blog from 16 September contains detail and analysis of the Programme for Government announcements. In this, we noted that there was a lack of clarity on proposals. Although the Government had signalled that its proposals on reducing the number of mainland territorial health boards to two were a start point for discussion, no such start point had been set out on the Government’s aspiration to rationalise the number of local authorities.
This changed when the Deputy First Minister and Minister for Public Service Reform wrote to the Conveners of the Public Service Reform, Finance and Public Administration and Social Justice, Local Government and Housing Committees on 21 September drawing attention to the Government’s “initial proposal for local governance reform”. As with the health board proposals, this was posed as “a starting point to foster discussions over the coming months”.
In this proposal, the Government suggests that the current local government arrangements, with 32 local authorities, might be replaced with 6 to 10 Regional authorities focussing on strategic decision-making, and 120-160 Community authorities, sitting within the borders of regional authorities, focused on local decision-making. This is described as likely to sit alongside “bespoke solutions” for island communities, so it is not clear whether the areas covered by the current three wholly island authorities, and three mixed island/mainland authorities are included in these figures. The Government says that it sees the starting point for discussion as being “to determine and agree the split of responsibility between community, regional, and national”.
The proposal does not give further detail on the consultation process, however the Government does say that it intends to be “an active participant” in dialogue, presumably over the three-month window previously announced. It says that it:
enters this dialogue with an open mind; we do not seek to be prescriptive at this stage. However the Government recognises the need to aid discussions by setting out an initial proposition.
Health and social care
The Government also reiterates an intent to take the next three months to engage with local authorities, trades unions, and healthcare and service providers on reform of social care. Despite the First Minister having suggested that he sees this sitting with the NHS in future, the letter makes no such “initial proposal” for discussion.
The Cabinet Secretary for Public Service Reform wrote to the Public Service Reform Committee again on 30 September, in response to the Committee’s request for clarification on points made earlier in the month. This included detail on the consultation process around health board restructuring. In this, the Cabinet Secretary confirms that the Government intends to “engage first and foremost with the workforce”, with a process to be agreed with trade unions.
In terms of timing, echoing comments made by the Cabinet Secretary for Health and Care at an NHS Scotland event on 21 September, the letter confirms that the Government is at what it describes as “the design phase of the work”, including developing business cases, and the Cabinet Secretary offered assurances that the work would be “developed in partnership with staff, staff representatives, trade unions, stakeholders and the public, with a strong focus on the needs of rural and island communities”.”
Reform of other public bodies
In his update letter on 30 September the Cabinet Secretary also explained the origin of Programme for Government proposals on consolidating public bodies. He said:
During July 2026, a functions-based review was undertaken which identified proposals on how to reduce duplication, increase efficiencies and restructure the public body landscape. The process developed a range of options from shared services models and digital transformation to structural reform as well as combining functions where they are closely connected.
To date, this review has not been made publicly available, though SPICe notes that some detail on the rationale behind proposals around reform of Transport Scotland was released in response to FOI requests on 6 October.
Other publications and updates
Alongside correspondence with committees, the Government has also published additional documents of relevance:
- On 17 September, results from the 2025 Scottish Household Survey on perceptions of local councils were published. Although this isn’t a public service reform (PSR) announcement, it represents baseline data which may prove useful in understanding the impact of local government reform in the future.
- The Public Service Leadership Statement, published on 23 September, was developed and agreed by the Scottish Leaders Forum, which brings together over 375 senior public service leaders (public, third and private sector). The Statement “creates a shared understanding of what effective leadership looks like across Scotland’s public services.”. The Statement includes a framework, but there is no detail on how this framework will be implemented across public services.
- Shaping the Future: Strengthening Scotland’s education system through empowered schools, published on 28 September, is the final report of the Independent Professional Advisor on future school reform in Scotland, with a focus on improvement, funding and governance. Writing to the PSR and Education and Gaelic Committees the same day, the Cabinet Secretary for Education, Culture and Gaelic confirmed that the recommendations of the review would “contribute to dialogue with local authorities over the coming weeks”.
- On 30 September, the Scottish Government Prevention Unit Plan was published, alongside an associated paper on Areas of Shared Interest which “sets out topics of strategic importance for addressing key prevention challenges in Scotland and where further research, evidence and collaboration could help support the shift towards a more preventative system”. These strategic documents set out the future work programme of the Prevention Unit in progressing the prevention pillar of the Public Service Reform Strategy.
- Impact assessments for the recent Programme for Government, covering the Child Rights and Wellbeing Impact Assessment, Consumer Duty Compliance Statement and Island Communities Statement, were published on 2 October. This identified that the announcements in the PfG were likely to have a positive impact on both children’s right and on consumer rights, and concluded that there was “No evidence of significantly different impacts requiring an Island Communities Impact Assessment were identified at the Programme for Government level.”.
- According to news reporting, on 7 October Scottish Government staff were advised through an internal communication of plans to offer voluntary severance packages to staff at C band and Senior Civil Servant level. According to the Scotsman, the staff notice explained that the announcement of packages was a part of the Government’s plan to reduce the public sector workforce as part of the Public Service Reform Strategy.
- On 8 October the Government published the year 1 progress report on the population health and service renewal frameworks. This update on a 10-year programme of reform suggests that, although more significant impacts will be medium to long-term, “important progress has been made in establishing the foundations required for lasting change”.
At his appearance before the Public Service Reform Committee on 1 October, the Cabinet Secretary for Public Service Reform said that the Government’s workforce management framework would be published “next week”. As of midday on Friday 9 October, this had not yet been published.
Outside of Government publications, the Scottish Fiscal Commission published, on 30 September, an insight on the Scottish Government’s efficiency and workforce plans. This notes that, rather than falling, the devolved public sector workforce has grown over 2025-26. The SFC explain:
This means that if the overall target is to be achieved over the period to 2029-30, larger reductions will be required from this year (2026-27) onwards. An update about the latest planned profile of workforce reductions alongside the Scottish Budget will be important.
The SFC also note that higher than expected inflation has meant that pay growth assumptions used in developing workforce plans may no longer be realistic, and that, as a result, “the latest assessment from Scottish Government on public sector pay assumptions underpinning its 2027-28 Budget will be important”.
On workforce, a recently published SPICe blog gives an overview of the NHS and Social Care workforce in Scotland.
Themes in scrutiny
Being at the start of a new session, several committees have taken the first full term of this Parliament to carry out scene-setting evidence, as well as tackle their first round of pre-budget scrutiny. This has presented committees with a natural opportunity to explore the implications of PSR in their subject areas. Across committees, there has been evidence on concerns from stakeholders, and what they would like to see from public service reform. However given that much of this evidence is based on initial proposals, there is an element of speculation to this. What may be more useful at this stage are the instances where committee scrutiny has led to more detail and clarification on proposed reform from ministers.
Concerns around the public service workforce have been a theme throughout the evidence taken by the Public Service Reform Committee. One point of interest has been the evidence taken from the Cabinet Secretary for Public Service Reform on pre-budget scrutiny at the Committee’s meeting on 1 October. During this, the Cabinet Secretary appeared to suggest that the Government’s policy of No Compulsory Redundancies for public sector workers does not eliminate the possibility that compulsory redundancies may occur in situations where all other options have been exhausted. This has prompted concern and calls for clarity from trade unions. In a statement to press, the Government confirmed:
There has been no change to the Scottish Government’s No Compulsory Redundancy commitment. The Cabinet Secretary was setting out the long-standing Scottish Government policy and referring to the fact there can be exceptional circumstances, and only where an employer has considered and exhausted all reasonable alternatives.
The Health, Care and Sport Committee took the opportunity of scene-setting evidence with the Cabinet Secretary for Health and Care on 16 September to seek clarity on some proposals. In this, the Cabinet Secretary suggested that there had already been an inquiry process that led to the Government landing on its “initial” proposal of moving to two health boards.
In evidence to the Equalities, Human Rights and Civil Justice Committee on 24 September, the Minister for Equalities confirmed:
Across the justice portfolio, we are working with partners to deliver person-centred, trauma-informed reform that is focused on improving the efficiency, effectiveness and accessibility of the justice system.
Where are we now?
The past few weeks have led to some points of clarification from the initial Programme for Government announcements, and the release of strategic documents which support planning going forward.
At this stage, although it seems like public service reform is moving at pace, there is still very little tangible and concrete detail, and any scrutiny beyond clarifying the Scottish Government’s intentions and initial plans may risk pre-empting the ongoing consultation process.
Ailsa Burn-Murdoch, Senior Researcher, SPICe