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International Services Strategy

Summary

Agency board report number: SEPA 50/23

This paper outlines the initial creation of the International Services Strategy and celebrates the success of its implementation and delivery.

Introduction

The paper outlines the journey of International Services since its establishment under the auspices of Commercial Services in 2016. It highlights the initial set-up, the approach taken, projects, and benefits achieved.

How it began

SEPA’s International Services function was initially established through the development of a strategy for the Agency to provide commercial services. In May 2016, a small team was tasked with developing an understanding of the potential and requirements for setting up a commercial function within SEPA. The team explored legal positions, governance, cost models, markets, competitors and partnerships, and undertook significant internal and external engagement. A proposal was subsequently submitted to the Agency Board for consideration in December 2016.

The proposal resulted in the development of a Commercial Services Strategy (Appendix 1), which was approved by the Agency Board in February 2017. The Strategy covered a five-year period and set out four areas of focus:

• Consultancy
• Value Added Data
• Grant Funding
• Marketing Our Assets.

SEPA’s ambition was to provide a variety of innovative new products and services that would both contribute to the delivery of our statutory purpose and raise additional revenue for the Agency. This in turn would enhance SEPA’s capacity to invest in the services that it provides, support improvement in environmental outcomes globally, and provide new and rewarding staff development opportunities, as well as helping build Scotland’s reputation as an influential world leader in environmental protection.

In November 2018, the Agency Board took the opportunity to reflect on the Strategy and consider its future path in respect of growth opportunities, resourcing and priority areas. The Board recognised that the new service delivered several benefits in addition to revenue generation. It also recognised that much of the work of the portfolio related to grant funding, which is not strictly commercial in nature. As a result, the Board agreed that there should not be a major growth strategy and that work should be undertaken to reposition the purpose of the current strategy. This work led to the re-designation of the commercial service as the International Services Portfolio, and the retention of three strategic functions:

• Consultancy
• Grant Funding
• Marketing Our Assets.

A new website was developed to promote the new service, providing a high-level overview of the range and type of services available as well as examples of SEPA’s successful international work.

Operating model

Setting up a new, commercial function was a real challenge and had not been previously attempted by many public sector organisations. To our knowledge, this was the first time that a Scottish regulator had attempted to set up a discrete commercial services unit that would operate internationally. This was a real opportunity to be successful, starting with a more or less blank page.

Given this was a novel initiative within a public body/regulator, the Agency Management Team and the Agency Board, wanted to ensure a clear plan for governance arrangements, financial targets, staffing issues, potential conflicts of interest etc. As such, significant effort was put into research, country profiles, unique selling points, legal positions, financial standards, potential operating models, internal and external engagement and strategy development.

The approved delivery model comprised a small, dedicated team (5 FTE) with additional specialist resource to deliver projects/activities drawn from across the Agency. An ‘opt in’ mechanism was used (via Agresso) whereby staff were invited to register an interest in working on international projects/activities, providing details of areas of knowledge, core skills. Over 300 members of staff opted in, and the mechanism was used to match skillsets to projects.

Strategy implementation and delivery

Implementation involved several projects throughout the duration of the Strategy, including project/work in over 20 different countries with other regulators and government bodies, successful applications for UK funding and a diverse range of environmental issues (from supporting the operationalisation of another regulator to waste management to soil degradation). Examples are provided in Appendix 2.

Several benefits were realised beyond revenue generation, including:

Staff development – Staff development was widely recognised as one of the biggest benefits in undertaking commercial work. The delivery of international projects has provided staff with the opportunity to share their knowledge and experience and build collaborative working relationships with a range of international organisations. Feedback from individuals has been extremely positive, particularly in respect of gaining an understanding of environmental challenges in other countries and seeing that our advice and guidance makes a difference.

Contribution to One Planet Prosperity Internationally and Building and Enhancing SEPA’s Reputation with Other International Governments and Regulators – Projects/Activities were conducted over 20 different countries across the globe, working closely with other governments and regulators including:

• The Department of Environment (Cyprus) and the Ministry for Agriculture, Rural Development and Environment (MARDE)
• The Environment Resources Authority, Malta
• IMPEL (European Union Network for the Implementation and Enforcement of Environmental Law)
• Government of Jersey
• BASEflow (NGO partner in Malawi)
• Government of Malawi, and its environmental and water regulators
• Ministry of Environment and Physical Planning, Macedonia.

Through these collaborations, strong working relationships and a successful track record have been established. As a result, SEPA is now often a priority contact for collaboration and providing advice and guidance.

Working in partnership with other UK public sector bodies – Many of our projects have involved multiple partners from across the UK public sector, including HSE, the James Hutton Institute, the Water Industry Commission for Scotland, and several local authorities. The relationships have proved to be very productive and valuable and have positioned SEPA well across the public sector.

Supporting Government ambition (Hydro Nation, Better Regulation) – Many of our projects are strongly linked with key government initiatives such as Scottish Government Hydro Nation, Better Regulation, UK Government Levelling Up Agenda, Industrial Strategy, Climate Justice and Net Zero ambitions.

Development of skills and Income Generation – As International Services has evolved, it has developed a strong skill set that can be deployed across the Agency, not least project management, training development and delivery, contract management, bid writing, stakeholder engagement, and project costing. An initial priority of Commercial Services was to generate income for the Agency. Over £3.5m has been generated from international and national projects and internal contract management.

Development space for regulatory approaches and efficiency of regulator landscape – Securing funding has enabled the Agency to create safe spaces whereby new/different regulatory approaches can be explored, co-developed with other regulators and key stakeholders.

Implementation of the Strategy did not come without challenges and risk, such as:

Resource: For project delivery there was an ongoing challenge in securing and maintaining adequate resource levels against the backdrop of other SEPA priorities.

Safety and Protection: There is potential risk for staff undertaking international work in other countries, although this was mitigated with bespoke risk assessments and safety management practices (for example extraction procedures).

BREXIT: With grant funding being a core area of focus and project funding coming from the European Commission, BREXIT has an impact on our services in other European countries. This impact was mitigated through our strong track record of delivery (from early projects), established working relationships (for example the European Commission, Special EU Programmes Body, Scottish Government European Territorial Co-operation) and collaborative approaches (for example with IMPEL).

COVID: The pandemic restricted travel and, ultimately, required new ways of working to maintain project momentum and working relationships.

Cyber-Attack: Many of the records stolen in the cyber-attack on SEPA in December 2020 were Commercial/International Services records. This, in addition to the lack of access to other SEPA records, made delivery of projects challenging.

Here and now

The Strategy formally ended in 2022 and since that time, the team has been ‘hibernating’, deploying resource to other priority work within the Agency. In September 2023, the Corporate Leadership Team made the decision to end this work. Some projects have already come to a natural end and the team will transition the Malawi Scotland Regulatory Partnership to conclude by March 2024. The Regulators’ Pioneers Fund for the Outcome Based Regulation project which will be delivered as planned by the end of the funding period (March 2025).

Recommendations

The Board is asked to note the report.