annual report and accounts 2015/16...annual report and accounts 2015/16 scottish natural heritage 1...

Annual Report and Accounts2015/16

Scottish Natural Heritage

1

Contents and reader’s guide

Performance ReportThe performance report provides information on Scottish Natural Heritage (SNH), including its main objectives, strategies and principal risks.

Overview Foreword 4About us 6How we plan our work 7Risks and uncertainties 8Performance summary 9Key facts and figures for 2015/16 11How we supported the Government’s National Performance Framework 13

Performance analysisPerformance against National Performance Framework Indicators 14Performance against activity key deliverables 16Performance against our 2015/16 Business Plan 17Financial, environmental and social summaries 36Nature Conservation Orders 41

Accountability ReportThe accountability report includes key statements and reports that allow SNH to meet accountability requirements and demonstrate compliance with good corporate governance.

Corporate governance reportDirectors’ Report 45Statement of Board and Accountable Officer’s responsibilities 48Governance Statement 50

Remuneration and Staff Report Remuneration policy and key information on staff 53

Parliamentary Accountability Disclosures Disclosures to Scottish Government 63

Independent Auditor’s Report Financial statements, regularity and any other matters 64

Primary financial statements and notes The Statements of Comprehensive Net Expenditure, Financial Position, Cash Flows and Changes in Taxpayers’ Equity, as well as details of accounting policies and supporting notes.

Statements and notes 67

3

Contents

Overview

Foreword 4

About us 6

How we plan our work 7

Risks and uncertainties 8

Performance summary 9

Key facts and figures for 2015/16 11

How we supported the Government’s National Performance Framework 13

Performance analysis

Performance against National Performance Framework Indicators 14

Performance against activity key deliverables 16

Performance against our 2015/16 Business Plan 17

Financial, environmental and social summaries 36

Nature Conservation Orders 41

Performance ReportThe performance report provides information on Scottish Natural Heritage (SNH), including its main objectives, strategies and principal risks.

4

Chairman and Chief Executive’s ForewordOur vision is that “People value Scotland’s natural assets because they generate benefits for all, sustaining us and improving our economy, health, lifestyles and culture.”

Scotland’s landscapes and seas, along with the nature they support, are a great benefit to the people of Scotland and valued the world over. We all play a part in protecting and managing Scotland’s natural assets, and in ensuring the sustainable use of our wealth of natural capital. In turn, we are all equally entitled to the benefits we derive from them.

The basis of much of our economy is rooted in these natural resources and the industries they sustain. Keeping these natural assets healthy and flourishing is vital to ensure that Scotland remains successful and prosperous and that we are all able to participate in and engage with nature in ways that enrich our lives.

This report sets out how our work contributes to our vision, supporting the Scottish Government’s purpose of creating a more successful country, with opportunities for all of Scotland to flourish by increasing sustainable economic growth. Here are a few examples of our achievements over the past year:

– This year, the Scottish Government confirmed our leadership role for the Scottish Biodiversity Strategy’s 2020 Challenge and Route Map to 2020. The first interim report shows good early progress on the actions which will benefit biodiversity and improve the state of nature in Scotland.

– We updated the Natural Capital Asset Index, which is a world leading approach to monitoring annual changes in natural capital. Natural capital, such as ecosystems, species, freshwater and land provides many benefits which help sustain our quality of life and it is crucial that they remain to benefit future generations.

– We worked with Marine Scotland to develop the Scottish Government’s approach to managing sensitive habitats and species in our seas. Statutory measures are now in place for nine marine Special Areas of Conservation and ten Nature Conservation Marine Protected Areas which support the vision for clean, healthy, safe, productive and biologically diverse oceans and seas.

– We set a target in 2013 of bringing 80% of protected site features into favourable or improving condition by March 2016. This target was achieved (80.4%) and contributes to the Scottish Government’s National Performance Framework Indicator for improving the condition of protected nature sites.

– Our work, in partnership with others, has contributed to an increase in the number of adults making one or more visits to the outdoors a week. The number grew to 48%, compared with 46% in 2013, and 44% in 2006 (the baseline year). This links to our on-going work on the ‘Natural Health Service’ which aims to improve health outcomes and reduce inequalities through safe local access to nature.

– The Green Infrastructure Strategic Intervention programme opened on 18th January. We are leading this major project, which will use £15m of European funding to improve Scotland’s urban environment. The scheme will increase and enhance green space in our towns and cities, especially close to areas of deprivation.

– In support of the updated Wild Deer: National Approach, we worked closely with the 44 members of the Association of Deer Management Groups. We provided nearly £150,000 to 34 groups to help develop effective deer management plans contributing to the sustainable management of Scotland’s wild deer population.

4

5

– We contributed to the Year of Food & Drink through our Scotland’s Natural Larder campaign. This promotes opportunities for healthy, natural food to reconnect people with the land and support local businesses.

– Working closely with Forest Enterprise Scotland, we supported over 50 projects through the Peatland Action Project, raising awareness of techniques and opportunities for the future, and restoring over 3,800ha of peatland. When added to the previous year’s achievements, a total of almost 9,250ha has been restored under this programme, contributing to the restoration of an important habitat and helping to mitigate climate change.

– We worked with Scottish Government to prepare guidance on wild land, in support of Scottish Planning Policy. We received the Scottish Renewables’ Green Energy Award for the joint SNH-SEPA Hydro Construction Best Practice Guidelines. We continue to invest considerable resources to enable development that supports Scottish Government strategies and carbon reduction targets.

– We have been an active supporter of the Scottish Government’s Youth Strategy, providing modern apprenticeships, graduate placements and longer term student placements. Those joining us have made a valuable contribution to our work; one of our apprentices won the ‘2015 Apprentice of the Year’ award from Skills Development Scotland.

– We made 4.2% in efficiency gains during 2015/16, against the Scottish Government’s target of 3%, allowing us to maximise our investment in the natural heritage. We achieved this through a continued programme of shared service initiatives with other public bodies and through further reduction of our office estate, which has decreased in size by 40% since 2011.

As these examples demonstrate, we cannot and do not work in isolation. Our operating principles ensure that we engage with and work through a wide range of partners and stakeholders. This includes other public bodies, third-sector organisations, businesses and individuals, who all make a significant contribution to the quality and abundance of our magnificent natural heritage and to the public benefits it brings.

Ian Ross Chairman

Ian Jardine Chief Executive

6

About SNH

Our PurposeScottish Natural Heritage (SNH) is a non-departmental government body funded by the Scottish Government. Our purpose is to:

– Secure the conservation and enhancement of nature and landscapes– Foster understanding and facilitate enjoyment of nature and landscapes– Advise on the sustainable use and management of nature and landscapes

Operating PrinciplesWe work in partnership, by cooperation, negotiation and consensus, with all relevant interests in Scotland, including public, private and voluntary organisations and individuals. We operate in a devolved manner, delegating decision-making to the local level, helping our organisation to be accessible, sensitive and responsive to local needs and circumstances. We operate in an open and accountable manner in all our activities.

Organisational ValuesOur organisational values are an important part of our approach to achieve our goals, setting out how we work with colleagues and partners. These are:

– We do what we say we’ll do– We communicate clearly and honestly– We take the initiative and are willing to adapt– We listen to and respect others’ views– We treat everyone with dignity and respect– We encourage people to deliver their best– We work together and learn from each other

Strategic AimsSNH sets out to achieve its purpose through four strategic aims:

– High-quality nature and landscapes that are resilient to change and deliver public value

– Nature and landscapes that make Scotland a better place in which to live, work and visit

– More people experiencing, enjoying and valuing our nature and landscapes– Nature and landscapes as assets contributing more to the Scottish economy

This report details our progress towards achieving these aims through high-quality public service. It also provides information about how we met the National Performance Framework (NPF) indicators, for which we were either the lead reporting organisation or to which we made a contribution. We support this with some specific examples of our work.

7

How we plan our workTo fulfil our strategic aims, we plan our work through our 2015-18 Corporate Plan. The corporate plan sets out the objectives for our work within the context of our corporate strategy.

Our annual business plan then lays out in more detail how we will deliver the objectives of the corporate plan. We plan and organise our work through a programme approach which is structured around a suite of four portfolios and fifteen activities. The activities form the focus for delivery of our work. This is displayed below:

Corporate Strategy

Corporate PlanIdentified 19 long-term outcomes to help achieve the four

strategic aims of our Corporate Strategy

Business PlanExpresses how we plan and deliver our work through four portfolios each with a sub-set of

activities

Portfolio 1Caring for the Natural World

Outcome: The condition of nature and landscapes is maintained and, where possible, improved to halt the loss of biodiversity and deliver wide benefits for the local economy, jobs and tourism.

Activities:

– Biodiversity Monitoring

– Marine Management– Protected Areas– Scottish Rural

Development Programme

Portfolio 2Enriching

People’s LivesOutcome: Better quality places in which to live, work and visit and increased opportunities to experience and value nature first hand

Activities:

– Creating Better Places

– Increasing Participation

– Managing National Nature Reserves

Portfolio 3Promoting

Sustainable Economic Growth

Outcome: Natural resources are sustainably managed as a key asset, underpinning Scotland’s sustainable economic growth.

Activities:

– Wildlife Management– Planning &

Development– Natural Resource

Management – Climate Change

Portfolio 4Delivering a High Quality

Public ServiceOutcome: Meeting the high standards expected of a public body by embracing three principles of public service delivery: putting the customer first; focusing on real improvements; and making sure that every public pound is spent wisely

Activities:

– Asset Management– People Management– Finance

Management– Corporate

Governance

8

Risks and UncertaintiesSNH follows Management of Risk guidance issued by the OGC1, which sets out definitive best practice for both public and private sectors. Where appropriate, our approach is tailored to suit SNH’s culture, environment and remit. We have a risk management policy which sets out the overarching principles of risk management for SNH. This includes defining how the principles should be adapted to manage risk at a project level. The principal risks and uncertainties faced by SNH are often outside of our direct control. For example, the risks associated with climate change are significant and include the impact on habitats and species, the overall health of our network of protected areas, as well as emerging new threats such as plant pathogens affecting native species.

In addition, we place significant emphasis on working in and through partnership with other organisations and a wide range of stakeholders. We manage this risk by maintaining connections with others and contributing to a range of government policies and priorities.

From a financial management perspective, the primary risk is uncertainty over future funding through our grant in aid, given the wide range of pressures on the Scottish budget and our current high dependence on this source of income. While we have a confirmed budget figure for 2016/17, our 2015-18 Corporate Plan was developed on an assumption of ‘flat cash’ which is now unlikely. With no end-year flexibility and no authority to retain reserves or to overspend, managing the underspend risk to within 1% of resource grant in aid will continue to be challenging.

The knowledge and expertise of our staff in providing advice and leading development projects is critical and there are risks associated with maintaining our capability and capacity, particularly where budgetary pressures require us to reduce our staff complement. Given that SNH’s primary ‘product’ is our expert advice, which requires a highly skilled workforce we will continue to adjust our plans to account for these pressures.

We actively manage our risks and report to our Audit and Risk Management Committee and our Board quarterly as part of the delivery of our corporate plan. These papers are available on our website.

1 Office of Government Commerce

9

Performance SummaryOur progress against our corporate plan is summarised through the performance of our four portfolios:

Caring for the Natural World This portfolio has achieved the key priorities which contribute to corporate plan objectives for Caring for the Natural World. This includes leading on the route map for the 2020 Challenge for Biodiversity, improving the condition of sites protected for nature in response to the favourable condition target, supporting the Scottish Government in developing a network of Marine Protected Areas, and supporting the new Scottish Rural Development Programme (SRDP).

Enriching People’s LivesThis portfolio has achieved the key priorities which contribute to corporate plan objectives for Enriching People’s Lives. This includes leading on the European Regional Development Fund (ERDF) Green Infrastructure Strategic Intervention programme, developing a Natural Health Service action plan, heading up work on the National Walking and Cycling Network, supporting the Central Scotland Green Network (CSGN), and providing opportunities for people, particularly young people and those from under-represented groups, to appreciate and enjoy high quality nature on our nature reserves.

Promoting Sustainable Economic GrowthThis portfolio has achieved the key priorities which contribute to corporate plan objectives for Promoting Sustainable Economic Growth. This includes providing early advice to developers and planners to save them time, facilitating appropriate development of renewable energy, infrastructure and other built developments. It involves working closely with stakeholders and taking a balanced approach to different interests in our wildlife management and licensing work. It also includes work to restore peatland to help the mitigation of climate change, support to Scotland’s Natural Larder campaign to help promote the importance of Scotland’s food and drink to tourism and the rural economy during the Year of Food & Drink, and providing input into the second Land Use Strategy.

Delivering a High Quality Public ServiceThis portfolio has achieved the key priorities which contribute to corporate plan objectives for Delivering a High Quality Public Service. This includes making the most of our organisation’s assets to optimise their use and reduce our running costs, as well as reducing our carbon emissions, making improvements to how we deploy our staff resources to help us respond to business needs, making improvements to the storage and accessibility of our information, and raising public awareness of the benefits and services which are supported by nature and landscapes.

10

Financial Performance

Interest Receivable

EU funding

Profit on Disposal of Property, Plant and Equipment

External Funding

Income from Activities

Grant in Aid

Capital

Operating Costs

Other Costs

Staff Costs

Delivering a High Quality Public Service

Promoting Sustainable Ecomonic Growth

Caring for the Natural World

Enriching People's Lives

PortfolioCosts

Expenditure

Income and

Financing

Interest Receivable

EU funding


External Funding


Grant in Aid

Capital

Operating Costs

Other Costs

Staff Costs





PortfolioCosts

Expenditure

Income and

Financing

Portfolio costs are split across the four portfolios used to deliver our corporate plan. Segmental information (financial statement note 3) provides more detail about costs incurred.

Interest Receivable

EU funding


External Funding


Grant in Aid

Capital

Operating Costs

Other Costs

Staff Costs





PortfolioCosts

Expenditure

Income and

Financing

Interest Receivable

EU funding


External Funding


Grant in Aid

Capital

Operating Costs

Other Costs

Staff Costs





PortfolioCosts

Expenditure

Income and

Financing

SNH receives Grant in Aid (GIA) from the Scottish Government to finance the majority of its activities. External funding (financial statement note 5) and income from managing our resources (financial statement note 6) provide opportunities for undertaking collaborative projects and shared services.GIA received in 2015/16 was £50.486m

Interest Receivable

EU funding


External Funding


Grant in Aid

Capital

Operating Costs

Other Costs

Staff Costs





PortfolioCosts

Expenditure

Income and

Financing

Interest Receivable

EU funding


External Funding


Grant in Aid

Capital

Operating Costs

Other Costs

Staff Costs





PortfolioCosts

Expenditure

Income and

Financing

Staff costs are £26.547m (49%) of our overall budget. SNH is an advisory organisation and delivers many of its portfolio priorities through its staff. Operating costs (financial statement note 10) represent a range of expenditure in delivering our portfolios, including grants, research, managing National Nature Reserves and management agreements. Other costs (financial statement note 9) represent the running costs of the organisation.

11

Facts and figures for 2015/16Facts and figures for 2014-15

Achieved our Delivering Favourable Condition target. By the 31st March 2016, 80.4% of features were assessed to be in favourable condition, making a valuable contribution to improving the condition of protected nature sites.

In 64% of planning cases subject to environmental impact assessment we engaged at pre-application stage, helping developers to take account of nature and landscape in their proposals as early as possible

Welcomed an estimated 610,000 visitors to our nature reserves, helping people to improve their understanding and appreciation of nature.

Restored over 3,800 hectares of peatlands through joint work with Forest Enterprise Scotland. Over 9,200 ha were restored in the past two years, helping to both benefit nature and mitigate climate change.

Responded to over 700 planning consultations, helping to safeguard Scotland’s natural heritage while contributing to sustainable economic growth.

Further reduced our carbon emissions by 4%, making an important contribution to mitigating climate change and reducing our overhead costs.

Supported the Scottish Government towards the restoration of the former Muirkirk opencast coal mine, helping to improve and maintain a nature site with European special protected status.

Won a leadership role in a new £37.5m Green Infrastructure Strategic Intervention programme helping to improve Scotland’s urban environment and increase and enhance green space in our towns and cities, especially close to areas of deprivation.

Provided more than 50% of the data currently available on the Scottish Environment Web’s (SEWeb) Land Information Search. We are a leading player in making data and information on nature more accessible to the public.

Supported 12 deer management groups and estate groups to count about 85,000 red deer over an area of almost 750,000 ha. Understanding the density of the deer population helps to inform actions to support sustainable wildlife management.

Processed over 1,900 applications for licenses to manage wildlife, helping to support sustainable management of our natural resources.

Assessed over 300 applications for the new Agri-Environment-Climate Change Scheme, which promotes land management practises to protect and enhance nature, including protected nature sites and wider biodiversity. A total of £17.6m was awarded to successful applicants.

13

SustainableEconomic Growth

We value and enjoy our built and natural environment and protect it and enhance it for

future generations

We live in a Scotland that is the most attractive place

for doing business

We have strong, resilient and supportive

communities where people take

responsibility for their own actions and how

they affect others

We live longer, healthier lives

Our public services are high quality, continually improving, efficient and response to local

people's needs

We live in well-designed sustainable places where we

are able to access the amenities and services we need

We reduce the local and global environmental

impact on our consumption and production

We contributed to the following National Outcomes:

How we supported the Government’s National Performance Framework in 2015/16The purpose of the Scottish Government is to focus government and public services on creating a more successful country, with opportunities for all of Scotland to flourish, through increasing sustainable economic growth. Sixteen national outcomes, which form part of the National Performance Framework, describe what the government seeks to achieve over the next ten years.

We contribute to the following national outcomes:

14

Performance against National Performance Framework IndicatorsDuring 2015/16, the Scottish Government identified 50 national indicators to track progress towards achieving the national outcomes. We were responsible for leading reporting on two of these and we also contributed towards a further two:

We led reporting on national indicators to:– Improve the condition of protected nature sites– Increase the abundance of terrestrial breeding birds: biodiversity

We contributed towards national indicators to:– Increase people’s use of the outdoors– Reduce Scotland’s carbon footprint

Lead reporting on: Status

Improve the condition of protected nature sites

The Condition of Protected Nature Sites Indicator, published 13 May 2016, shows that 80.4% of sites were assessed as being in favourable condition or improving. This was a 1.1% increase on 2014/15 figures. The Scottish Government’s ‘Scotland Performs’ reporting framework assesses performance as ‘improving’.

There are three broad types of protected feature: earth science, which covers geological features, is assessed at 98.1% in favourable condition; species are assessed at 76.3% in favourable condition; and habitats are assessed at 79.4% in favourable condition. All three categories highlighted an increase during 2015/16, with habitats showing the largest rise (2.2%).

The main challenges to further improvements on the condition of protected nature sites are invasive species and over-grazing. The proportion of assessments recording invasive species as a negative pressure has risen for the past four years to 20% in 2015/16. This includes both non-native species, such as rhododendron in woodlands, and native species, such as birch encroaching on to raised bog habitats. The proportion of assessments recording over-grazing by wild herbivores and/or domestic stock showed a slight decrease in 2014/15, but rose again in 2015/16 from 18.1% to 18.4%.

Increase the abundance of terrestrial breeding birds: biodiversity

The Terrestrial Breeding Bird Indicator1, published on 3 December 2015, showed that the combined figure for all terrestrial breeding birds for 2014 had increased by 15% in comparison with 2013.

Of the different categories of birds, the farmland bird index has shown a steady increase up to the late-2000s, but has declined since then so there is no significant difference between 1994 and 2014. The smoothed woodland bird index has increased significantly by 63% overall, while the smoothed upland bird index has decreased by 19% overall.

1 http://www.snh.gov.uk/publications-data-and-research/our-changing-environment/scotlands-indicators/biodiversity-indicators/biodiversity-state-indicators-list/

15

Contributed to: Status

Increase people’s use of Scotland’s outdoors

The Increase people’s use of Scotland’s Outdoors Indicator, published in August 2015, shows that 48% of adults made one or more visits to the outdoors per week in 2014, compared with 46% in 2013, and 44% in 2006 (the baseline year).

We have contributed to this indicator through our work in support of organisations which provide outdoor recreational, volunteering and learning opportunities. We also contribute towards this indicator through the promotion of our national nature reserves. In addition, our lead role in the National Walking and Cycling Network project, the Green Infrastructure Strategic Intervention programme and our work in developing a ‘natural health service’ will contribute to this indicator over the longer term.

Reduce Scotland’s carbon footprint

The National Performance Indicator reveals an increase in tonnes of CO2 for the whole of Scotland in 2012 compared with 2011 (the most recent national data available).

However, SNH’s own performance shows that we have made significant strides towards reducing our organisation’s carbon consumption. This shows that our CO2 emissions for 2015/16 has decreased by 4% in comparison with 2014/15.

We have made these savings by minimising our energy needs – for example by maximising our office occupancy rates and adopting energy efficiency measures, such as the use of renewable energy systems at our buildings. We have also reduced travel through further investment and use of our video conferencing facilities.

KeyThe status indicates the national performance of the indicator rather than SNH’s contribution. This is particularly relevant to ‘Reduce Scotland’s carbon footprint’ where national performance is declining but SNH’s performance is improving.

Performance Improving Performance Maintaining Performance Declining

16

Performance against key deliverablesAs well as reporting on our contribution towards the National Performance Framework, we also monitor and report on our performance in achieving our key deliverables. These are specific objectives which we aim to complete over one or more years and which contribute towards achieving the related Activity and Portfolio outcomes.

* Slippage reflects where progress has not been made as originally planned. In total 10 key deliverables experienced minor slippage which are expected to be delivered during 2016/17. Another 7 key deliverables either require work to be progressed by others or has not progressed as expected due to changed priorities and will be adjusted in 2016/17 to reflect this.

0 2 4 6 8 10 12

Number slipped*Number on-trackNumber Completed

Corporate Governance

Finance Management

People Management

Asset Management

Climate Change

Natural Resource Management

Planning & Development

Wildlife Management

Biodiversity Monitoring

SRDP

Protected Areas

Coastal and Marine Management

Managing Nature Reserves

Increasing Participation

Creating Better Places

17

Performance against our 2015/16 Business Plan


Enriching People’s Lives

Promoting Sustainable Economic Growth


18

Portfolio 1

Caring for the Natural WorldBiodiversity Monitoring

We have an evidence base to support policy and decision making and to underpin our work and advice

This year, the Scottish Government confirmed our leadership role for the Scottish Biodiversity Strategy’s 2020 Challenge and Route Map to 2020. Our delivery agreement (2015-18) gives more detail. A key part of this role is to inform and enthuse stakeholders and the general public about the 2020 Challenge, what it means to them and how they can contribute to it. We’ve also been asked to report regularly on progress on the 64 actions in the route map, and we’ve completed the first interim progress report which shows good early progress.

We updated the Natural Capital Asset Index, which is a world leading approach (developed by SNH) to monitoring annual changes in natural capital. Natural capital, such as ecosystems, species, freshwater and land, provide many benefits which help sustain our quality of life, and it’s crucial that healthy natural systems remain to benefit the next generation. The Index helps provide a robust and consistent framework for monitoring changes. We also report annually on more specific aspects of the state of Scotland’s nature. We continued to coordinate this and now include developing measures of ecosystem health such as species diversity. We also continued to lead conservation efforts on key species, with a national survey of freshwater pearl mussel this year and projects to help this species (see accompanying case study).

Coastal and Marine Management

Scotland’s seas are ‘clean, healthy, safe, productive and biologically diverse’ and achieve Good Environmental/Ecological Status.

Protected areas are one of the mechanisms used to ensure protection of some of the most vulnerable marine species and habitats. We focussed our efforts this year on supporting the Scottish Government’s implementation of Scotland’s Marine Protected Area network. Marine Protected Areas can be designated for nature conservation, demonstration/research or historic reasons. We supported Marine Scotland (MS) in launching a consultation on the Fair Isle Demonstration & Research Marine Protected Area, and we launched a consultation on the Inner Hebrides and the Minches possible Special Area of Conservation for harbour porpoise. We monitor the condition of Marine Protected Areas and continue to invest in improving our understanding of them. In addition, we surveyed a range of other Marine Protected Areas and Special Areas of Conservation around Scotland’s seas. We continued to develop our advice on marine Special Protection Areas for birds and held a workshop with stakeholders to discuss the evidence, the proposed boundaries and future management.

We worked with MS to develop the Scottish Government’s approach to managing sensitive habitats and species. We supported a series of stakeholder workshops and further discussions to develop fisheries management measures so that significant impacts that fishing practices might cause can be avoided. Statutory measures are now in place for nine marine Special Areas of Conservation and ten Nature Conservation Marine Protected Areas. Marine planning is of growing importance. Following publication of the National Marine Plan, we worked with MS and regional partners to help create Regional Marine Planning Partnerships in Shetland and the Clyde; and supported their work to develop regional assessments to help plan development.

19

Protected Areas

To maximise the value of Scotland’s protected areas as a resource for the people of Scotland.

This year, we achieved a major milestone. For the past four years, we have been focussing our efforts on improving the condition of protected sites. We set a target of bringing 80% of protected site features into favourable condition by March 2016. This target was achieved. It has taken many years of sustained effort with many SNH staff, partner organisations and land management interests, both past and present, contributing. The work is recognised in the Scottish Government’s National Performance Framework as part of protecting and enhancing our natural environment for future generations. We also made an important contribution to the Scottish Government’s efforts to develop an opencast coal response plan for Muirkirk & North Lowther Uplands Special Protection Area. The Scottish Government budget contains £2m for the first year (2016/17) of a five-year plan.

We have long focussed on feature condition as the measure of success for protected areas. This year, we initiated work to explore the contribution protected areas make to other elements of the Scottish Biodiversity Strategy, so we can develop broader outcome measures. We published a discussion document in summer 2015, which follows on from our work on reviewing protected areas. At the site level, we completed a pilot project to sharpen conservation objectives and conservation measures for Natura 2000 sites (sites protected under the two European Nature Directives).

Scottish Rural Development Programme (SRDP)

Support under the SRDP is well targeted to sustaining Scotland’s natural heritage.

The new Scottish Rural Development Programme (SRDP) opened in 2015 and runs for five years. This includes the £340m Agri-Environment and Climate Scheme (AECS); the £6m Improving Public Access (IPA) and the £10m Environmental Co-operation Action Fund (ECAF). We act as a delivery partner in these schemes. AECS is the principle way to support work on protected areas, peatland restoration and deer management. Under AECS, the IPA scheme offers capital investment in lowland paths. ECAF is a new scheme, supporting two or more land managers to develop a collaborative approach to work on eight priority areas, four of which are led by SNH, which can then be funded via AECS.

We worked with the Rural Payments & Inspections Directorate (RPID) to fine-tune how these schemes operate and also helped develop guidance at each key stage through the year. A total of 900 AECs applications were received by RPID, of which our staff assessed 300 cases, leading to 215 contract offers worth £17.6m. In a separate round, we received 28 IPA cases, which led to 18 contract offers, and we received 26 ECAF applications, which we will assess in 2016/17.

20

Case Study

‘Pearls in Peril’ – Securing the future of the freshwater pearl mussel in Great BritainFreshwater pearl mussels act as a barometer of the health of our rivers and burns. The actions we take to conserve them also benefit the wider river ecosystem.

This increasingly rare mollusc lives hidden amongst the bed of cold, fast flowing rivers and burns. Scotland has many of the world's most important remaining populations and a significant number of rivers with breeding populations. But even in Scotland there has been a dramatic and sustained decline of this species. Maintaining populations that are still breeding is essential for their long term existence.

‘Pearls in Peril’ (PIP) is a LIFE+ nature project (a European funded project) led by SNH, to save and restore freshwater pearl mussel in 21 sites across Scotland, England & Wales. The project has delivered simple conservation measures working with 22 organisations and a range of stakeholders, including land managers and owners, conservation charities, volunteers, and local schools, businesses and communities.

A major restoration project was undertaken on the River South Esk in 2015: PIP restored natural river processes by removing almost 1km of boulder bank protection. This has created a new river channel with a diverse habitat that now acts as a source of sediment to replenish downstream freshwater pearl mussel beds and provide spawning areas for Atlantic salmon and trout.

The project has planted thousands of trees on the South Esk and created new wet woodland. Stock fencing along seven kilometres of watercourses and eight off-stream livestock watering points have been installed. The pearl mussel is a cold water species that requires a silt-free, oxygenated riverbed to survive. Trees provide shade, helping to lower water temperatures, and their roots bind the riverbank reducing erosion. Fencing prevents livestock from accessing the river and creates a buffer near arable fields. This reduces the fine silts that enter the watercourse and smother the riverbed. These measures directly benefit freshwater pearl mussel and other river wildlife. The management work was funded by applications to Angus Environmental Trust and to the Agri-Environment Climate scheme under the Scottish Rural Development Programme.

PIP is working to ensure the conservation work leaves a legacy with its partners and stakeholders, so that future projects can be realised for the benefit of freshwater pearl mussels and the wider river ecosystem.

Freshwater pearl mussels gaining a foothold amongst the cobbles of this fast flowing river

22

Portfolio 2

Enriching People’s LivesCreating Better Places

The environmental and landscape quality of places, particularly in central Scotland, is improved to help enhance people’s quality of life, health and well-being, and to support economic growth and regeneration.

After considerable work, the Green Infrastructure Strategic Intervention programme opened on 18th January. We are leading this major project which will use £15m of European funding to improve Scotland’s urban environment, increasing and enhancing green space in our towns and cities, especially close to areas of deprivation. This will be achieved through a range of well-targeted projects, partly funded with the European money with a total investment of £37.5m over the course of the 2014 – 2020 European Regional Development Fund (ERDF) programme.

Together with Sustrans and Scottish Canals, we have also led development of the National Walking and Cycling Network, resulting in some £6m being spent on developing priority routes during the first year of the initiative. Launched by the Scottish Government in March 2015, the initiative aims to create 30 new long-distance routes, extending the path network by 500 miles over the next five years. More details about this work can be found in the accompanying case study.

Increasing Participation

More people experiencing, valuing and taking action to look after nature and landscapes

One of the major ways in which we get more people to experience and value nature is through our grants programme. In 2015/16, our grants supported 28 projects, providing volunteering opportunities for over 100,000 people in a range of practical conservation activities and citizen science. Over 120,000 young people benefitted from outdoor learning experiences, helping them to understand nature and landscapes. Forty projects supported our priorities across the Central Scotland Green Network (CSGN) area, helping more people to access and enjoy nature. We also led work with other Rural Affairs, Food and the Environment (RAFE) organisations to develop Scotland’s Natural Health Service. This included preparing a new action plan (endorsed by Minsters) to help improve physical and mental health in Scotland through nature and the outdoors.

As well as our grants, we run promotional campaigns to encourage people to visit the outdoors. One of those campaigns, Simple Pleasures Easily Found, informs locals and visitors what they can discover about Scotland’s nature and landscapes close to our major urban areas.

23

Managing NNRs

Well managed, nationally important nature that everyone can enjoy and which helps us to connect with nature.

Our National Nature Reserves (NNRs) showcase the very best of Scotland’s landscape and wildlife. We ensure they are well managed and that visitors enjoy the reserve whilst not harming or disturbing the habitat and wildlife. To encourage visits we hosted a series of open days and events throughout the year including guided walks, displays and demonstrations. In 2015/16, we estimate that around 610,000 people visited our reserves. We receive regular feedback on their experience to help us improve our service. Over the year, we created the opportunity for people to engage with nature with 4,000 volunteering days, 6 year-long student placements, and 3,500 attendees at special events.

We continued with a programme of investment to enhance our visitors’ experience through infrastructure improvements on NNRs, including path extensions and improvements on Rum, path improvements at Ben Wyvis, and an upgraded car park at Flanders Moss.

In support of protected areas, we also continued to manage our sites to achieve favourable condition. As of March 2016, 84.2% of the 599 features on our NNRs were in favourable condition. This compares well with the overall favourable condition statistic of 80.4%.

25

Case Study

Getting Connected – Improving the network of long distance walking and cycling routesAn improved Scotland-wide network of long distance walking and cycling routes is a major element within the Scottish Government’s National Planning Framework (NPF3). Well managed and promoted traffic-free paths and tracks are important to encourage people to enjoy the outdoors and to travel more sustainably. The National Walking Cycle Network (NWCN) project aims to improve and extend the existing path network by creating new routes, addressing missing connections, and making better connections to city, town and local path networks. The long-term vision is for a well-connected and accessible network for local people and visitors of all ages and abilities to use for recreation and active travel, offering wide socio-economic benefits.

The lead partners, SNH, Sustrans and Scottish Canals, set out a 20-year vision for this network and identified 33 important 'missing links' for delivery by 2019. Another 17 projects have also been identified for longer term development. Collectively these projects should provide some 1,750 km of new trails, resulting in around 8,000km nationally by 2034. The role of the lead partners is to facilitate, promote, monitor and report route and network improvements. Broad benefits include:– Allowing people from Scotland and beyond to enjoy more of our outdoors safely– Supporting fragile rural economies, through increased visitor spending– Helping residents to choose sustainable travel options and keep fit and healthy

Since 2015, lead partners have spent £6m (£0.5m by SNH) creating and improving 52km of routes and links. So far, this has resulted in four routes being completed: – Cowal Way – Great Trossachs Path – Hebridean Way – John Muir Way, including new Kilpatricks Hills section

In addition, a number of pathworks are underway:– Crook of Devon to Kinross – Cross-Scotland Pilgrim Way, Strathfillan – Southwest Coastal Path, Rhins area – Speyside Way extension, Aviemore to Newtonmore – National Cycle Route 73 Arran, and Newton Stewart to Cairn Ryan – National Cycle Route 74 Gretna to Glasgow – Arran Coastal Way – Canal towpaths, Lowland, Caledonian, Crinan

Find more information about this national programme on the Scottish Government’s website at: https://npfactionprogramme.com/national-developments/08-national-long-distance-cycling-and-walking-network/

Off-road cycle routes offer a safe and peaceful way to avoid traffic and enjoy the outdoors

26

Portfolio 3

Promoting Sustainable Economic GrowthWildlife Management

Scotland’s wildlife delivers the greatest value to people while securing its abundance and welfare

We continued to work with many stakeholders towards this goal, making real progress on many key areas. We maintained investment in projects conserving vulnerable species such as red squirrels, sea-birds and ground-nesting birds. Many of these involve tackling threats from non-native species and contributing to the 2020 Biodiversity Routemap. Others focus more on creating conditions where reintroduced or other vulnerable species can prosper and conflicts can be minimised. We submitted comprehensive advice to Scottish Ministers to help them decide how wild beavers should be managed.

Much of Scotland’s sustainable wildlife management takes place in the uplands. In support of the updated Wild Deer: National Approach, we worked closely with the members of the Association of Deer Management Groups, providing nearly £150,000 to 34 groups to help develop effective deer management plans. We also published our Scientific Advisory Committee’s Moorland Management Review on the impact of management practices. There was continued work to help understand mountain hare management on grouse moorland and to help the Moorland Forum bring sources of knowledge together for its Understanding Predation report. We continued to develop goose management schemes, balancing conservation obligations with agricultural interests. To contribute to our work against wildlife crime, for the first time we restricted the availability of General Licenses by placing restrictions on two localities.

Planning & Development

Good development happens in the right places, enhancing the quality of people’s lives, supporting Scotland’s sustainable economic growth and transition to a low-carbon economy

We continued to invest considerable resources to support development that aligns with Scottish Government strategies and carbon reduction targets. We advised on a number of major tourism, and national infrastructure developments, although market conditions meant there was less demand from renewable energy proposals. We looked to engage with planning authorities and developers on these as early as possible to save time in the process later on. As well as responding to 118 Local Development Plan consultations, we provided scoping or pre-application advice in 74% of the planning cases on which we were consulted (66% in 2014/15). Our advice remains targeted and proportionate. We focus on developments most likely to have significant impact on natural assets. We only objected outright this year to 8 out of 753 cases with unresolved issues of national importance.

27

We published our new Service Level Statement for Planning & Development, to help customers make best use of our services. Building on this, we substantively completed our Casework Improvement Initiative to streamline our processes. We continue to improve the range of guidance to support high quality development proposals, particularly for renewables. We also worked with the Scottish Government to prepare guidance on wild land in support of Scottish Planning Policy. We received Scottish Renewables’ Green Energy Award for the joint SNH-SEPA Hydro Construction Best Practice Guidelines. Finally, we undertook an initial review of our performance against the new Scottish Regulator’s Strategic Code. When completed, we will consider how to continue to improve our services in the future.

Natural Resource Management

Strengthen the capacity of Scotland’s natural resources to deliver a wide range of benefits and essential services to further well-being and economic success.

A focus this year has been to help the Scottish Government develop the Second Land Use Strategy. This strategy influences decisions about how land is used and managed to benefit all in society in the long-term. As part of this work we welcomed being asked to help develop an Upland Vision. We also helped the Scottish Government shape its Future of Scottish Agriculture discussion document, so that it reflected a vision for Scotland’s agriculture to be a world leader in green farming with tangible environmental, social and economic achievements. We continued to engage and support a wide range of other partners with large-scale land management plans and initiatives. This included working closely with SEPA on their new River Basin Management Plans, with local interests on the Galloway & South Ayrshire and Wester Ross Biosphere Reserves, and with non–governmental organisations (NGOs) on a number of 2020 Biodiversity Routemap projects.

We contributed to the Year of Food & Drink through our Scotland’s Natural Larder campaign. This promotes opportunities for healthy natural food to reconnect people with the land and support local businesses. Underlining the importance of Scotland’s natural assets to tourism and the rural economy, we also helped develop the Eat Drink Hebrides Trail.

28

Climate Change

Raising awareness of how nature helps us cope with climate change, what climate change means for nature, and how we can help it cope.

One of the ways nature helps us cope with climate change is the ability of active peatlands to “lock-up” carbon, offsetting atmospheric emissions from other sources. We were provided with £3m of investment from the Scottish Government’s Green Stimulus fund to boost the contribution peatlands work could make to the targets in its 2nd Report on Policies and Proposals under the Climate Change Act. This allowed us to build on the successes already achieved through our “Peatland Action” grant programme. Working closely with Forest Enterprise Scotland, we supported over 50 projects, raising awareness of conservation methods and opportunities for the future, and restoring nearly 3,900ha of peatland. When added to last year’s achievements, a total of almost 9,250ha of peatland has been restored under this programme. We published the National Peatland Plan to promote and guide further investment in our internationally important peatlands to achieve climate change and biodiversity benefits.

We also published an update of our statement on ‘Climate Change and Nature’. This sets out our plans for ongoing work in this area, increasingly in collaboration with other parts of the Scottish Government and its agencies. As part of this contribution, we provided specialist staff to help complete the National Coastal Change Assessment and helped Marine Scotland develop its understanding of ‘Blue carbon’ storage potential in Marine Protected Areas.

The peatbogs of the Flow Country in Caithness and Sutherland store an estimated 400m tonnes of carbon

31

Case Study

Reconnecting people with local and natural produce – Scotland’s Natural LarderDiscussing ideas over shared food has long been a way to meet and connect with people. At the core of our Scotland’s Natural Larder project is the idea that by focusing on food and wild food in particular, we can engage people in discussions about the natural resources that a healthy and well-managed environment provides for us.

Through our Scotland’s Natural Larder project, we’re working with a range of partners to raise awareness of the local food that is seasonally available from nature. We are also sharing the knowledge and demonstrating the skills needed to make the best use of these resources. Our conversations range across the origins of food, the environment from which it comes, and the sustainable harvest of venison, wild plants, game, fungi and seafood. We encourage people to experiment with the skills to prepare and preserve food from the wild.

In October 2015, as part of our extensive programme for the Year of Food & Drink, we organised a series of events based round a visit to Scotland by Greta Huuva, a chef, forager and the food ambassador for the Sami people (also more commonly known as Laplanders). Although rapidly adapting to take advantage of modern storage and preservation technology, Sami culinary tradition is based largely round winter supplies of reindeer meat and fish and foraged plants and berries in the summer. These centuries-old practices ensure that the Sami maintain a close link with natural resources and the seasonal food.

We took advantage of the visit to bring people together, including stakeholders who are involved in the use of wild food in Scotland, to share ideas about its wise and sustainable use. Throughout the week, across Scotland, different groups met and considered wild food use in restaurants, and products, as well as measures to improve health and wellbeing, draw tourism and tackle food poverty by encouraging people to eat fresh, seasonal, affordable and minimally processed food.

We brought together some of Scotland’s leading exponents of wild food (chefs, foragers, food activists, hunters, fishermen, bloggers, herbalists, bushcraft teachers and environmental educators) at an outdoor event in Nethy Bridge which combined foraging and cooking with broad-ranging discussions.

A Chairman’s reception at the Royal National Mod in Oban, with fantastic food from Scotland’s Natural Larder, was one of the final events organised during this visit. It was a great demonstration of the ability of food, music and culture to reach and unite new audiences for environmental messages.

As part of Scotland’s Natural Larder campaign demonstrations were provided on how to prepare wild food such as the common rabbit

32

Portfolio 4

Delivering a High Quality Public ServiceAsset Management, People Management, Finance Management & Corporate Governance

SNH is a modern public service organisation, responsive to our customers and the political, economic and social context in which we operate

To provide a high quality public service, we need to be responsive to our customers’ needs and achieve public benefits for every pound we spend. Meeting these aims in an environment where budgets are under increased pressure has meant that much of our focus during 2015/16 was on how to use our resources as efficiently and effectively as possible.

As our staff are our most significant and influential resource, we developed a workforce plan to ensure that we have the right people with the right skills in the right place at the right time. Work will continue in 2016/17 on identifying the skills and deployment processes needed to make sure we have a more agile and flexible workforce, ready to achieve our current and future priorities. A key element of our workforce planning focuses on talent management and skills for the future. We have been an active supporter of the Scottish Government’s Youth Strategy, providing modern apprenticeships, graduate placements and longer term student placements. Those joining us have made a valuable contribution to our work and their commitment was amply demonstrated when one won the ‘Apprentice of the Year’ award from Skills Development Scotland this year.

Reducing our fixed costs to maximise our funding for our natural heritage work has also continued to be a priority. We reduced fixed costs with a continued programme of shared service initiatives with other public bodies and further rationalisation of our office estate, which has been reduced by 40% since 2011. Savings such as these have contributed towards meeting the Scottish Government’s target for efficiency gains of 3% on our 2011/12 baseline budget. Overall, we made 4.2% or nearly £2.547m of savings during 2015/16.

An important element of delivering a high quality public service is to ensure the public and stakeholders can swiftly access the right level of information for their needs. We therefore began work in 2015 to make improvements to how we collect, store and access our information and data. As much of this information is accessible on our website, we also continued to update its content. In 2015/16, over 600,000 people viewed our website, an 18.5% increase over the previous year, and 66% of these were new visitors. We also started work to ensure that our website continues to provide the necessary features for an increasingly sophisticated audience. Moreover, we actively supported other related websites and one such example is highlighted in the accompanying article of the development of Scotland’s Environment Web (SEWeb).

Finally, we continued to use online and digital services to both promote and inform the public about Scotland’s natural heritage. This included social media channels, as well as the on-line publication of our popular Nature of Scotland Magazine, and our monthly digital newsletter, which now attracts 21,000 subscribers, a 6,000 increase in comparison with the previous year.

33

Jennifer Porteous being presented with her ‘Apprentice of the Year’ Award

34

The SEWeb website offers a gateway to everything you need to know about Scotland’s environment

35

Case Study

Partnership working, Data Sharing and Environmental information – Scotland’s Environment Web As a lead partner in the development of Scotland’s Environment Web (SEWeb)1 we have been delighted by the announcement from the European Commission during EU Green Week that it is a winner of the EU LIFE Best Awards for 2015. We extend congratulations to Scotland’s Environment Protection Agency (SEPA) for this outstanding achievement and are very pleased to be associated with it. SEWeb has been a model partnership with a clear purpose and effective delivery that has exceeded expectations across all fronts, while coming in on time and on budget.

We have shared SEPA’s vision for easy web access to environmental information through active participation in SEWeb Management from the outset. We have contributed to SEWeb development, such as in providing content for and editorial oversight of environmental reporting. We built the Land Information Search module, we supply open data through our SNHi Natural Spaces web services, and we enable site condition data to be interrogated, mapped and graphed as a part of the indicator of Scotland’s Ecosystem Health. The EUNIS2 Land Cover of Scotland map, by applying European data and classification standards, delivers a commitment in Scotland’s Biodiversity Strategy Route Map to 2020 and is the SEWeb base map. We continue to work with SEPA and other partners on the further development of SEWeb, such as through advances in linked data, and championing broader collaboration through RAFE.

During 2015 we supported the production of the Atlas of Living Scotland, the biodiversity component of SEWeb and potential future interface for the UK National Biodiversity Network (NBN). It provides a platform for the collection, aggregation, analysis and use of biological data in Scotland. Atlas is again all about partnership. Funding was made available from SEPA and SNH, supported by the European LIFE programme and was built by the NBN and CRSIO (Commonwealth Scientific and Industrial Research Organisation of Australia), with support from the UK Joint Nature Conservation Committee.

The NGO community has vital interests both as information users and data contributors. They bring practical insights, knowledge and influence. Beyond Scotland’s borders we worked with Natural England, Natural Resources Wales and the Department of the Environment, Northern Ireland – where Atlas is also now being adopted.

A great advance is that Atlas is intuitive and easy to use. It does things quickly with results and images appearing on screen pretty much instantly. Interest in functional applications has already been expressed through Scotland’s National Planning Forum and the Scottish Rural Development Programme. It is an electronic gateway but it is also being considered as an interactive display in the Royal Botanic Garden Edinburgh atrium, the John Hope Gateway – a practical example of extending it into mainstream public use.

1 http://www.environment.scotland.gov.uk/2 European Union Nature Information System

http://www.environment.scotland.gov.uk/

36

Financial, environmental and social summariesFinancial Performance

A budget is agreed with Scottish Government (known as Departmental Expenditure Limit or DEL). This is to cover cash costs, which include accrued expenditure (capital and operating) net of income from other sources such as income from activities, and non-cash costs of depreciation, amortisation and impairments. To allow resources to be allocated to other Scottish Government priority areas of work, SNH was given Scottish Government approval to underspend on cash costs and non-cash costs during the year.

The initial Resource DEL cash operating allocation of £48.814m was increased during the year by £3.350m to fund peatland restoration. Of this, £1.190m was subsequently reallocated to Forest Enterprise Scotland to support peatland restoration on land it managed, with the balance of £2.160m remaining with SNH to manage. SNH also received funding for various other initiatives totalling £0.562m, and contributed £1.500m to support SRDP to arrive at the amount shown in the following table of £50.036m.

The Capital DEL allocation was £1.200m and the DEL non-cash allocation was £3.080m.

A budget relating to Annually Managed Expenditure (AME) was also provided by Scottish Government. In the context of SNH operations, this covers the costs relating to new provisions and certain changes relating to existing provisions and impairments (where they relate to changes in asset values from volatile markets). In 2015/16, impairments of £1.388m resulting from the regular five-year valuation of the antiques and works of art in Kinloch Castle on the Isle of Rum increased the original forecast of AME expenditure and resulted in the overspend reported below.

The attached financial statements containing the results for the year start on page 67.

SNH is required to manage its out-turn within the Scottish Government budget limits:

– For 2015/16, the DEL budget limit was £54.316m, with an approved underspend of £0.750m, net £53.566m. SNH incurred £51.870m net expenditure, which resulted in a net underspend of £1.696m (2014/15: £0.887m) under spend and is made up as follows:

Resource DEL £0.380m Non-cash Resource DEL £1.270m Capital DEL £0.046m

£1.270m of this underspend related to an underspend of non-cash costs i.e. depreciation, amortisation and impairments of property.

– The out-turn on AME was an overspend of £0.911m. This impairment is a result of changes in values within the global market for antiques and works of art. The budget was based on an estimate of what the reduction was likely to be at the time. The actual impairment was higher than anticipated.

SNH drew down all but £0.750m of its cash budget allocation of £51.236m as a result of approved underspends agreed with the Scottish Government.

37

* To allow funds to be redeployed to other areas of priority work within the Scottish Government, it was agreed that SNH would draw down as cash grant in aid, all but £0.750m of the DEL budget allocation for 2015/16. Approval was therefore given that this amount would be discounted from any underspend arising against SNH’s DEL budget allocation at the end of the financial year. The underspend referred to is therefore the net of this amount.

Income from activities during the year was £3.373m (2014/15: £2.642m). The increase was due to income from shared services initiatives – for example, sharing offices and IT applications.

Significant capital asset additions during the year included:– Information system infrastructure £0.292m– Vehicle fleet replacement £0.204m– Staff accommodation, Isle of Rum £0.203m– Office Refurbishment for collocation, Newton Stewart £0.133m

Out-turn Budget Approved Underspend*

(Under)/ Overspend

£000 £000 £000 £000

Net expenditure per accounts 52,025

Expenditure/income adjustments for budget purposes: (3,019)

Operating cash costs 49,006 50,036 650 (380)

Operating non-cash costs 1,810 3,080 – (1,270)

Resource DEL costs 50,816 53,116 650 (1,650)

Capital DEL costs 1,054 1,200 100 (46)

DEL Budget 51,870 54,316 750 (1,696)

Provision movements and unwinding of discounts 1

Release of relocation provision (135)

Impairments on antiques and works of art 1,388

AME Budget 1,254 343 – 911

Budget out-turn notes £000

Operating cash cost adjustments

– depreciation and amortisation (1,711)

– income received re capital project 45

– DEL impairments (99)

– AME impairments (1,388)

– provision movements and unwinding of discounts 29

– expenditure and decreases to provisions 105

(3,019)

Operating non-cash costs

– Depreciation and amortisation 1,711

– DEL Impairments 99

1,810

Capital additions

– Tangible and intangible assets 1,116

– Capital contribution (45)

– Net book value of asset disposals (17)

1,054

Details are shown in the table below:

38

SNH had net current liabilities of £1.616m at 31 March 2016 (2014/15: £2.064m). The reduction is due to increased levels of trade receivables, offset by higher levels of cash and cash equivalents and lower trade and other payables at 31 March 2016. This was in part due to the increased activity within shared service projects and activity relating to European projects during 2015/16.

In 2015/16, SNH’s expenditure on the head office relocation to Inverness, which was funded in part by the Scottish Government, was:– charge to relocation provision for early retirement £0.066m– decrease to relocation provision charged

to operating expenditure £0.004m

Best Value

SNH continues to deliver best value in line with Best Value Public Service guidance issued by the Scottish Government.

We do this through:– a clear vision and outcomes – set out in our corporate strategy, corporate plan

and business plan– performance management – tracked and reported through our business

planning system under four portfolios that include our improvement initiatives– our approach to partnership working, which underpins much of what we do,

involving building positive, mutually beneficial relationships with many other bodies

– governance and accountability reflected in our management structure, policies and leadership, which set out clear lines of responsibility and reporting, as well as the robust systems we use for decision-making, budget and risk management

– how we manage our resources – undertaking reviews of our fixed assets, maximising efficiencies for procurement of goods and services, and making the best use of our people

– building sustainability into how we operate – through our procurement practice, the greening of our offices, sharing accommodation with other organisations, and our approach to travel and how we use energy

– embedding equality in how we function, working towards delivering our equality outcomes, and meeting the requirements of the equality legislation

Social Inclusion

Promoting social inclusion and diversity is core to our vision:

“People value Scotland’s natural assets1 because they generate benefits for all, sustaining us and improving our economy, health, lifestyles and culture.”

Our aspiration is for everyone to have the opportunity to enjoy a good quality local environment. This includes regular access to nature, involving communities in the care of and in decisions affecting their local environment, and better access to environmental information.

To deliver this vision, we promote and fund a range of outdoor recreational, volunteering and learning opportunities with a particular focus on young people (under 25 years), people on low incomes, people with poor physical or mental health, or people who are experiencing exclusion (such as a disability or through their ethnicity). In 2015/16, we funded or directly offered opportunities to over 100,000 volunteers and supported 120,000 young people to take part in outdoor learning. This was in partnership with organisations such as The Conservation Volunteers, Volunteering Matters (formerly Community Service Volunteers) and Grounds for Learning.

1 The term ‘assets’ refers to Scotland’s species, ecosystems, habitats, geology, landscapes and landforms. (SNH Communication Strategy 2015 – 2018)

39

Opportunities to enjoy the outdoors should be available to everyone, but this is not always the case in Scotland at present. Providing greenspace and local path networks close to where people live and work is important to give the chance for all to be physically active and have contact with nature. However, developing appropriate information, promotion and education, tailored facilities and outreach projects are also needed to help include everyone.

Regular research helps us identify key audiences and develop policies and practices to encourage and enable more people in Scotland to access the outdoors. Over the years, surveys such as the Scottish Recreation Survey, the Scottish Nature Omnibus and, more recently, Scotland’s People and Nature Survey (SPANS), have given us a better understanding of how people in Scotland use, enjoy and value the natural environment; which groups are most and least likely to access the outdoors and what factors influence participation. The SPANS Special Interest Report Number 2, Participation in Outdoor Recreation: Under-represented Groups, focuses on participation among members of the population who are less likely to visit the outdoors, such as people living with a disability or a long-term illness, those in poor health, older people and people living in the most deprived areas of Scotland. Through our main and associated websites, we make information about the natural environment available to all. Information about our grants, our projects and our key policies are also available on our website. With Environment and Forestry partners and Education Scotland, we launched the Outdoor Learning Directory – a new website gateway to information for teachers and others involved in outdoor learning in Scotland.

During 2015/16, we also continued to focus on the Scottish Government priority of Youth Employment, creating opportunities for young people. This has included continuing our apprenticeship, graduate, college and school placement schemes; investing, through external funding, in giving opportunities to young people to train and volunteer; and continuing a partnership with Young Scot to help get young people more involved in our work on the Scottish Biodiversity Strategy. This includes a national youth advisory panel, with an age range from 13-23 across Scotland (Yell in Shetland to Wishaw in Lanark).

Sustainable Development and Carbon Management

As highlighted earlier in this report we have led on the development of the Green Infrastructure Strategic Intervention programme, which forms part of the 2014 – 2020 European Regional Development Fund (ERDF) programme. Through the Green Infrastructure Fund, we aim to improve Scotland’s urban environment, creating and enhancing multifunctional green space in our towns and cities, benefitting some of the most deprived areas in Scotland, giving real benefits to people in these areas through improving access to and use of local greenspace.

Nature and landscapes, and the goods and services they provide, are significant building blocks in the Scottish Government’s ambition to create a more successful country and improve the health and well-being of its people. SNH is demonstrating how to help nature adapt to climate change through climate change adaptation case studies. These studies take place across a range of Scottish habitats, from the uplands to coastal saltmarshes, particularly on national nature reserves. For example, at Blawhorn Moss national nature reserve, land managers have been working to block former drainage ditches to restore the peatland habitat and make it more resilient to warmer and drier summers. Of course, this also helps the bog to store carbon and mitigate climate change.

Nature helps us cope with climate change – for example, by storing carbon. This year we undertook 3,870 hectares of peatland restoration under Peatland Action to help tackle climate change.

SNH is a leader in terms of carbon management. While we’ve achieved a lot already, there is more we aspire to do to reach the 2050 carbon reduction target of

40

80%. There are opportunities to reduce our carbon footprint by changing how we work and our use of buildings. This will become increasingly important for us, and we are looking to learn from others, as well as sharing our best practice.

In 2003, we set ourselves a target to reduce the emissions from our own work by 42% by 2020 – a little over 3% a year, every year. Our emissions come from the energy we use to heat, light and power our buildings, our work travel and waste management. The 42% target reflected the Scottish Government’s then target of a 42% reduction in greenhouse gas emissions by 2020 from a 1990 baseline. As we reported in last year’s Annual Report and Accounts, we had already achieved this level of reduction in 2015 – this year we have continued to make good progress towards the greater ambition framed in the 2050 target with a further 4% reduction in comparison with 2014/15.

We are striving to transform our offices and how we use them. We share an increasing number of buildings with other bodies and we share information and good practice in terms of energy use, waste practices, greener behaviours and travel to work. Our investments in greener buildings, renewable energy systems, greener fleet and greener fleet management, and non-travel options for work and meetings have all brought long term benefits. These will continue to bring benefits in future years, in terms of both carbon reduction and cost savings.

Last year, we worked with Scottish Government and other bodies to develop a meaningful and consistent climate change reporting tool for public bodies, leading by example in achieving and reporting our climate change duties. The format and content of the process has been completely revised. In line with the new Public Bodies Climate Change Duties Reporting, our yearly totals for 2015/16 will be published on the Keep Scotland Beautiful website alongside all other major players. All the reports, including our own will be available in November at http://www.keepscotlandbeautiful.org/sustainability-climate-change/sustainable-scotland-network/climate-change-reporting/201415-submitted-reports/

Personal Data Related Incidents

In 2015/16, SNH had no significant data related incidents.

We continue to work towards aligning Information Management, Infrastructure and Security controls against the ISO27001 Standard. In 2015/16, staff were encouraged to undertake the Cabinet Office E-learning on Information Security. We have also recently completed the Audit Scotland Security Awareness Survey to ensure our staff and customers’ data is secure, protected and well managed. We received positive and constructive feedback from Audit Scotland. We will continue to adopt best practice for information security and ensure we continually improve the way we manage our sensitive information.

Supplier Payment Policy

We comply with the Government’s Better Payment Practice Code. We therefore aim to pay within 10 days from the receipt of goods and services or the presentation of a valid invoice, whichever is later.

In 2015/16, 98% of invoices were paid within the 10 day target (2014/15: 98%). We made three payments during the year for compensation under the Late Payment of Commercial Debts Regulation 2013 totalling £30 (2014/15: nil).

Ian JardineChief Executive and Accountable Officer28 July 2016

http://www.keepscotlandbeautiful.org/sustainability-climate-change/sustainable-scotland-network/climate-change-reporting/201415-submitted-reports/http://www.keepscotlandbeautiful.org/sustainability-climate-change/sustainable-scotland-network/climate-change-reporting/201415-submitted-reports/http://www.keepscotlandbeautiful.org/sustainability-climate-change/sustainable-scotland-network/climate-change-reporting/201415-submitted-reports/

41

Nature Conservation Orders made during the year to 31 March 2016The Nature Conservation (Scotland) Act 2004 (2004 Act) came into force on 29 November 2004. The provisions of Section 23(1) ensured that all Nature Conservation Orders (NCOs) and Special Nature Conservation Orders (SNCOs) in place before that date continued in force as NCOs under the 2004 Act. It remains our view that these orders should be used only as a matter of last resort when there is a direct threat to the natural features of an SSSI and/or a European site.

At the end of March 2016, there were five NCOs in force, with another four Amendment Orders, giving an overall total of nine orders in force.

As required by Section 28 of the 2004 Act (as amended by Regulation 9 of the Conservation (Natural Habitats, &c.) Amendment (Scotland) Regulations 2004), we report that during 2015–16:– no new NCOs were made– no existing NCOs were amended– no existing NCOs were revoked

More information on NCOs can be found on our website at http://www.snh.gov.uk/protecting-scotlands-nature/protected-areas/orders/nature

http://www.snh.gov.uk/protecting-scotlands-nature/protected-areas/orders/naturehttp://www.snh.gov.uk/protecting-scotlands-nature/protected-areas/orders/nature

43

Contents

Corporate Governance Report

Directors’ Report 45

Statement of Board and Accountable Officer’s responsibilities 48

Governance Statement 50

Remuneration and Staff Report

Remuneration policy and key information on staff 53

Parliamentary Accountability Disclosures

Disclosures to Scottish Government 63

Independent Auditor’s Report

Financial statements, regularity and any other matters 64

Accountability ReportThe accountability report includes key statements and reports that allow SNH to meet accountability requirements and demonstrate compliance with good corporate governance.

45

Corporate Governance ReportDirectors’ Report

Information relating to membership of the Board, the Management Team and on the auditors of Scottish Natural Heritage

SNH Board and Committees

SNH has a non-executive Board, which is supported by a Scientific Advisory Committee (SAC), a Protected Areas Committee (PAC) and an Audit and Risk Management Committee (ARMC). Members of the PAC and ARMC committees are appointed by the SNH Board. The chair of SAC is appointed by the SNH Board and the other members are recruited by open recruitment. SNH Board Members are normally appointed for three years by Scottish Ministers, with some appointments extended for a further term. Members may be appointed for a third or subsequent term of office through a process of open competition. The membership of the Board at 31 March 2016 was as follows:

Sid Patten resigned from the Board in May 2015.

Susan Walker was reappointed for a further two year term from 1st April 2016. Angus Campbell, Robert Furness and Ian Gillies were reappointed for a second three year term from 1st April 2016.

Keith Nicolson and Simon Pepper’s Board appointments ended on 31st March 2016.

A recruitment process to recruit new Board members was undertaken during 2015/16. This resulted in the appointment of five new members from 1st April 2016.

The full biographies for our Board members can be found on our website at this link: http://www.snh.gov.uk/about-snh/board-comm-and-mgt/board/board-members/.

SNH aims to be an open and accountable organisation. The four SNH Board meetings and two Scientific Advisory Committee meetings held in 2015/16 included open sessions, which the public were welcome to attend. Agendas, papers and minutes are published on the SNH website. SNH also held seven Area Evening Receptions and/or Stakeholder Meetings hosted by the Chair or Depute Chair throughout Scotland in 2015/16 to which the public were invited.

A register of interests is available on the SNH website http:/www.snh.gov.uk/about-snh/board-comm-and-mgt/board/board-members/.

Appointed to SNH Board

Term Date at which current term of appointment ends

Ian Ross (Chair) 1 April 2013 1st 31 March 2017

Susan Walker (Depute Chair) 1 April 2010 2nd 31 March 2016

Angus Campbell 1 April 2013 1st 31 March 2016

Robert Furness 1 April 2013 1st 31 March 2016

Ian Gillies 1 April 2013 1st 31 March 2016

Keith Nicholson 1 April 2010 2nd 31 March 2016

Simon Pepper 1 April 2010 2nd 31 March 2016

http://www.snh.gov.uk/about-snh/board-comm-and-mgt/board/board-members/http://www.snh.gov.uk/about-snh/board-comm-and-mgt/board/board-members/http:/www.snh.gov.uk/about-snh/board-comm-and-mgt/board/board-members/http:/www.snh.gov.uk/about-snh/board-comm-and-mgt/board/board-members/

46

Management Team

The responsibilities of our Management Team, which served during 1 April 2015 and 31 March 2016, are set out below. Full biographies can be found on our website.

Ian Jardine: Chief Executive

Ian has overall responsibility for managing the organisation, including overseeing our activities and achievements to the Scottish Government and the aspirations of our corporate strategy, as well as ensuring that Scottish Natural Heritage operates efficiently and effectively.

Susan Davies: acting Chief Executive

Susan undertook the responsibilities of Chief Executive during 2015/16 while Ian Jardine was on secondment to the Scottish Government.

Andrew Bachell: Director, Policy & Advice

Andrew is responsible for a team providing specialist technical and policy advice supporting SNH's work and advising government.

Nick Halfhide: Director, Operations

Nick is responsible for overseeing the operational activity and advice of our local offices and for the work of the National Operations Unit.

Joe Moore: Director, Corporate Services

Joe is responsible for a number of teams supporting the organisation, including Human Resources Services, Finance Services, Business Support Services, Information Systems and Programme Management.

Eileen Stuart: Head of Policy & Advice

Eileen is responsible for the strategic lead on policy and advice issues including rural development, landscape, recreation, ecosystem approaches, and habitats and species.

47

Ross Johnson: Head of Operations

Working alongside the Director of Operations, Ross is responsible for maintaining an overview of the work of the operational areas to help them achieve their contributions to SNH's business plan.

Alan Mowle: Head of Strategic Development

Alan was responsible for giving analysis and advice to the chief executive and the Management Team, providing strategic development for SNH.

Ian Bainbridge: Head of Service

Ian was responsible for SNH's research programme and science liaison with the Scottish Government, providing scientific advice and quality assurance on a range of species, habitat, site and casework issues.

Jane Macdonald: Head of Portfolio Planning and Budgeting

Jane is responsible for effectively integrating our business planning, allocations, budget management and reporting activities, so the chief executive and Management Team are given timely and accurate management information and intelligence on the implementation of the corporate and business plans.

Auditors

SNH’s accounts are audited by Audit Scotland, which is appointed by the Auditor General for Scotland. The costs relating to their statutory audit work in respect of the financial year were £0.048m (2014/15: £0.053m). No other fees for non-audit related services were paid to them.

Disclosure of Audit Information to the Auditors

So far as the Accountable Officer is aware, there is no relevant audit information of which SNH’s auditors are unaware. The Accountable Officer has taken all the steps that he ought to have taken to make himself aware of any relevant audit information and to establish that SNH’s auditors are aware of that information.

48

Statement of Board and Accountable Officer’s ResponsibilitiesSNH’s Framework Document agreed with its sponsoring Scottish Government Directorate, sets out the roles and responsibilities of Scottish Ministers, the sponsoring team in the directorate, the SNH Board, the Chairman of SNH and SNH’s Accountable Officer. It i

annual report and accounts 2015/16...annual report and accounts 2015/16 scottish natural heritage 1...

Documents