Magazine article Public Finance

All Fired Up?

Magazine article Public Finance

All Fired Up?

Article excerpt

Working in the public sector today is a bit like taking part in The Apprentice. Finance staff face a range of trials and tribulations and need good skills to cope

AS ? WRITE, the YoungApprentice TV series is halfway through. What, you might ask, has this got to do with public sector financial management?

Well, the contestants face a series of challenges, from the regular to the unexpected, as do public sector staff. Although this might feel like a time of unprecedented upheaval, many of the changes in the public sector have been tackled somewhere in some form before. Learning from others and from the past are useful skills - something The Apprentiee candidates don't always appreciate.

The first of the public sector's current challenges - cutting public spending - was expected. But the scale of the cuts was not. It's no longer 'more with less'; not even 'the same with less'. Now it's 'less with less'.

For councils, the scale and pace of implementation is even greater as the cuts have been front-loaded. But local government has traditionally had greater flexibility over its investment strategies, and central government can learn from how the best authorities have managed to reduce budgets.

In January, the Treasury published a paper on improving financial management in government - Managing taxpayers' money wisely: commitment to action. One of the enablers of success it identified was 'a cost-conscious culture - ensuring every decision is built on informed financial assessment'. Lord Sugar would expect no less.

The second of the tests facing the public sector is the way it provides services. The Open public services white paper contains five main principles for reform: choice; decentralisation; diversity; fairness; and accountability. Tensions exist between some of these principles - such as decentralisation and accountability - and between them and what is happening in central government.

One example is centralised procurement under the Cabinet Office's Efficiency and Reform Group. This aims to secure economies of scale from the government's buying power - but how does this sit with local choice and decentralised decision-making?

One problem the public sector will increasingly face is managing competing priorities, with financial and non-financial targets pulling in different directions. Good option appraisals, with clear criteria for balancing competing priorities, will be needed.

But technical expertise is not enough. …

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