Early in 1824, at the request of Earl Bathurst, he drew up a carefully thought out and elaborate plan for providing for churches and schools in Australia. The central idea was that one-tenth of the lands in the colony should be vested in trustees for the support of churches and schools. Primary schools were to be followed by schools for agriculture and trades, and also schools to fit students for a university which was ultimately visualized. He also suggested that pending the establishment of the university a few of the ablest students should be awarded exhibitions to take them to Oxford or Cambridge. His plans were adopted in a modified form, he was appointed archdeacon of New South Wales in October 1824, and he arrived at Sydney on 7 May 1825. He was also made a member of council and a trustee of the clergy and school lands; this corporation, however, had neither land nor funds. Governor Brisbane opposed his suggestion that "government reserves" should be considered church and school lands, and with regard to land generally, comparatively little of it had even been surveyed. Scott too was working on the assumption that the control of education would be in the hands of the Church of England, which brought vigorous opposition from the Presbyterians, Wesleyans and Roman Catholics. Scott's connexion with Bigge and a friendship he had formed with John Macarthur tended to make him unpopular, and though Governor Darling spoke of him as amiable and well-disposed, he quarrelled with several men of the period. On 1 January 1828 he sent his resignation to England and was succeeded in 1829 by Archdeacon, afterwards Bishop, William Grant Broughton. Scott's final report on the church and school establishment of New South Wales was dated 1 September 1829. He then returned to England, took charge of his parish at Whitfield, and was later made an honorary canon of Durham. He died at Whitfield on 1 January 1860.
Scott was a capable man who was unfortunately quarrelsome and arrogant. He could not get on with his own clergy, and when he visited Tasmania in 1826 a report he made on the state of religion and education raised similar antagonism to that he had experienced in Sydney. He was a hard worker, he had a fine conception of the place education should take in the colony, and during his five years in New South Wales the number of schools and the number of pupils attending regularly were both more than doubled. His proposed scheme of education in Australia could not be accepted at the time, largely because it assumed the ascendancy of the Church of England, but considered broadly it was a statesmanlike piece of work which must have had much influence on the plans that were later developed.