Magazine article Public Finance

On Account

Magazine article Public Finance

On Account

Article excerpt

Revving up for change

Public servants are having to navigate the twists and tarns of government policy as part of ministers9 efforts to increase Whitehall's financial skills

THIS YEAR'S FORMULA ONE season had an unpredictable and exciting start, with seven different winners in seven different races. The same can be said for central government finance, which shares some other similarities with Grand Prix racing. Both experience constant rule changes, requiring agility and swift mastery of technical amendments.

In Whitehall, examples include the Clear Line of Sight reforms and the Treasury's new rules in Improving spending control, as well as moves to strengthen and embed good financial management across government.

Early in 2011, the Treasury published Managing taxpayers' money wisely: a commitment to action. This was the foundation for central government's Finance Transformation Programme, which requires all public servants to strengthen financial discipline, not just finance professionals.

The Treasury is taking this forward in collaboration with the head of the Government Finance Profession, Richard Douglas, who is also the Department of Health's director general for policy, strategy and finance.

Continuing the Formula One analogy, the Finance Transformation Programme has four 'wheels' to support it leadership; a cost-conscious culture; professionalism; and expert central functions.

Strong leadership is essential. In Formula One, managers set the direction for all aspects of the team and the car, sharing their vision of how to achieve success. The same applies to the FTP, which demands strong leadership from the (relatively) new board structure. This is chaired by the lead minister in each department and made up of an equal mix of officials, ministers and non-executive directors, who have been given an enhanced role. They are largely drawn from the private sector to challenge and ensure financial discipline in decision-making.

The second wheel is a cost-conscious culture. Lesser Fl teams need to convert each and every hard-won point over the season into increased sponsorship. Decisions on technical development, including the equipment purchased, have to be assessed to ensure they maximise the team's achievements.

Similarly, civil servants need to move away from spending the budget to assessing the need for expenditure. …

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