Financial Management in Government: Monitoring and forecasting
21 January 2025
Good financial management is critical in the public sector. For public services to be efficient and productive, the effective management of public finances is essential.
This guide outlines how finance leaders across government can monitor budgets and their performance and ensure forecasting is effective.
It focuses on three principles:
- Promote a culture of accountability – leadership emphasises the importance of budget holders being accountable for monitoring financial performance and ensuring forecasts are accurate and realistic.
- Develop the right skills and capabilities – finance professionals possess the skills and capabilities to monitor effectively and forecast with precision and leverage these to elevate the quality of the organisation’s decision-making.
- Make the best use of data and information – high-quality data and information is used to enable better monitoring and more accurate forecasting, helping decision-makers respond to events quickly and effectively.
Financial Management in Government: Allocating Resources
10 December 2024
For public services to be efficient and productive, the effective management of public finances is essential.
This guide outlines how finance leaders across government can allocate resources effectively when resources are scarce and trade-offs need to be made.
It focuses on three principles:
- Using information intelligently an organisation should use trusted and objective information intelligently, so it can allocate resources to support strategic objectives.
- Prioritising effectively – finance leaders should support decision makers to make difficult decisions and trade-offs to generate good value-for-money outcomes based on agreed priorities.
- Building for the long term – decisions need to balance short-term pressures with long-term priorities and align with the strategic objectives of the organisation.
A planning and spending framework that enables long-term value for money
27 October 2024
To deliver value for money over the medium- to longer-term, a government needs to turn its objectives into outcomes in a way that delivers the best value for every pound of taxpayers’ money while managing its fiscal position.
It needs to: plan and prioritise its spending (and other activities) to address those objectives; monitor and manage both costs and value delivered; evaluate the results adjust as necessary; and report to Parliament on how it has used taxpayers’ money. The planning and spending framework within which governments do this follows a basic cycle.
The government has limited resources and a list of areas requiring investment and improvement – it has never been more important for the government to get the most out of every pound of public money.
A sustainable approach to planning and spending is a key enabler of better public sector productivity. HM Treasury and the Cabinet Office have crucial roles, to ensure that the planning and spending framework creates the right incentives for overall value for money throughout the complex system of departments and other bodies with delegated financial accountability.
Despite evidence of hard work in HM Treasury and the Cabinet Office to build lasting improvements, there has not been the cultural shift towards a focus on long-term value for money that is needed.
Changing the incentives and behaviours embedded across central government will take leadership, functional expertise and collegiate behaviour at all levels, official and political, over a whole Parliament and beyond
Maintaining public service facilities
22 January 2025
Having good-quality property that is properly maintained, utilised and adaptable to future needs is fundamental to delivering public services. However, the condition of government property has declined over the last decade.
The government has accumulated at least £49 billion of maintenance backlog. The government will need to consider the optimal way to manage its assets alongside its long-term investment plans, in addition to the cost of ongoing maintenance, to bring property condition to a satisfactory level.
The scale of the challenge will become intractable unless the Office of Government Property (OGP) urgently addresses strategic planning gaps across government, so it and departments can understand what the full picture of maintenance requirements is across government, ahead of the next and subsequent spending review periods.
In the short term, this will allow the most urgent works to be prioritised and risks to be understood. In the medium to long term, it will allow for the government to take a more strategic approach to property maintenance and management, working towards future-proofing the estate to make it fit for purpose and to represent the best value for money.
Other reports
Government’s approach to technology suppliers: addressing the challenges
18 January 2025 - The effective use of technology suppliers is essential to the success of government’s ambitions to improve and digitally transform its services and operations. But repeated delays and cost overruns in digital delivery undermine government’s ability to achieve its policy objectives. This report examines the overall approach to digital and technology suppliers.
DCMS’s management of its COVID-19 loan book
18 December 2024 - Between October 2020 and March 2022, the Department for Culture, Media & Sport (DCMS) lent £474 million to 120 borrowers operating in the culture and sports sectors to help them survive the COVID-19 pandemic. This report looks at whether DCMS is delivering value for money through its management of the loan book.