This will require a cultural shift, up-skilling of personal and investment over many years to achieve similar levels of performance. The difference between government and business is that in the latter, the commercial case for making such improvements is usually compelling. The financial management performance of commercial organisations, their ability to understand their position and effectively manage their resources, are critical to staying in business.
Government does not have the same immediate threat of insolvency or the need to maintain and grow profits in a competitive environment. Partly as a consequence, it also does not have good measures of what current sub-standard practices cost it in terms of under-utilised assets, wasted resources arising from sub-optimal decision making or policy making based on inaccurate and incomplete data. That is not to say no organisation has a view - the State Auditors of many countries might well have the data to attempt this calculation.
Making the case for a stronger remit for finance and enhanced investment in people, systems and process is likely to start with an understanding of the unreported costs of the current system. While this might not be a comfortable exercise for the executive management in government, the prize of making the resources go further, not having to ask tax-payers for more money and improving the sustainability of the public finances, is surely worth it.
Ross Campbell, ICAEW Director, Public Sector
Public Sector Community, February 2018
© Ross Campbell