By Steve Freer
The CIPFA Manifesto, to be launched next week, sets out the institute's ideas for restoring confidence in government. Steve Freer gives a flavour of its content
** Steve Freer is chief executive of CIPFA. The CIPFA Manifesto, Better ideas, better public services, will be launched at the annual conference in Manchester on June 23–25 **
At some stage over the next 12 months a general election will be called. We know already that the backdrop to it will be distinctive. An unprecedented combination of seismic events – the global credit crisis, the economic downturn and the evaporation of trust in our politicians – has dramatically heightened levels of public uncertainty, concern and disenchantment.
The new government will face some very difficult challenges, regardless of its political complexion. But what sort of policies and approach will it be best advised to adopt in such uniquely testing conditions? At CIPFA, we have focused our energies on answering this question by developing our own manifesto, which will be launched at next week’s annual conference in Manchester.
The CIPFA Manifesto, Better ideas, better public services, brings together lots of complementary proposals for improving governance and financial management in government and throughout our public services. Its scope is wide-ranging – every- thing from MPs’ expenses to allocating resources fairly. But if there is a recurring theme that provides a drumbeat to the overall package, it is ‘restoring trust’. We need to find ways of doing the business of government that exude objectivity and integrity and inspire public confidence.
The manifesto opens with some clear suggestions for sorting out the catastrophe of MPs’ expenses. The central proposition here is that Parliament should play no part in setting MPs’ pay and benefits. Instead, a new commission should be established, with full delegated powers to determine all aspects of remuneration, including pensions and expenses. It should be appointed in a manner that is demonstrably independent of vested interests, including Parliament, government and the political parties.
All expense claims should be made publicly available online to encourage MPs to consider the spirit – the ‘how will it look?’ test – as well as the letter of the law. There should also be no special tax concessions associated with MPs’ pay and expenses.
Openness and transparency are vital characteristics of good governance. The CIPFA Manifesto considers why public governance in the UK seems too often to lack these qualities and focuses in particular on two potential causes – the tendency to over-centralise and the silo nature of government. It argues for an approach that is biased towards local decision-making and seeks out opportunities to simplify and, where possible, standardise the processes of government. The aim is that the way all public bodies do business – whether hospital, library, police station or school – should feel familiar and present efficiently to citizens.
This raises the broader question of how we can place citizens and service users at the heart of the thinking of all arms and agencies of government. For example, can we routinely and systematically involve them in service planning in order to tailor services effectively to meet their needs? This is already the rhetoric of many public bodies but it is rarely their reality. The manifesto sets out to make citizen-engagement a real hallmark of our public services, arguing in particular the case for their involvement in the difficult decisions that need to be taken over the next few years to rebalance the public finances.
There are other steps, too, that the manifesto suggests can be taken to improve public decision-making. New policies (including pilot schemes) should be accompanied by detailed statements of expected outcomes – including estimated costs, income and savings – and more policies should be subjected to independent post-implementation review. Reviewers should compare and report actual and expected outcomes and have the power to recommend amendment or repeal of relevant legislation or regulations.
Government can also do much more in the area of better informing the public. At the macro level we need to reintroduce clear fiscal rules to guide the management of the public finances. We should also publish Whole of Government Accounts – fully consolidated financial statements for all public expenditure – to make clear the financial position of government, including all assets controlled by the public sector, as well as all current and long-term liabilities. In particular, we need to encourage informed debate about long-term fiscal sustainability.
At a more micro level – in individual public bodies – we need to rise to the challenge of better financial management. Chief finance officers have a major role in this area but to fulfil it they must be correctly positioned in the organisation. This links to CIPFA’s new guidance – also scheduled for launch in Manchester next week – which stresses the importance of the chief finance officer being a member of the leadership team, actively involved in and able to bring influence to bear on all material business decisions.
Crucially, the chief finance officer must lead the promotion and provision of good financial management by the whole organisation. That means getting layers of management – from the boardroom at the centre to service managers on the front line – striving continuously to maximise value for money. The philosophy here is that lots of small actions can made a big difference.
CIPFA recommends that its guidance should be embedded within sectoral and organisational governance codes on a ‘comply or explain’ basis. This is about giving the guidance bite and ensuring that any public bodies that decide to depart from it do so on a carefully considered basis, against which they can be held to account.
The manifesto gallops on with ideas for improving the collective performance of public service organisations and for adjusting legal powers to strengthen partnership working and enable innovative schemes to proceed more freely. It argues for placing a duty on all public bodies to consider, publish and consult on the impact of their policies and decisions on other public agencies. Again, this has a particular resonance in relation to the forthcoming period of tight financial settlements. These are precisely the conditions in which public bodies can lose sight of the bigger public interest picture as they focus narrowly on tough domestic challenges that need to be resolved.
Stressing the need for clear lines of accountability, the manifesto also addresses the importance of the government taking care to ensure that its own actions do not impair the accountability arrangements of local public bodies. Capping of local authority budgets is an example of a national policy that has the effect of undermining local accountability. Indeed, in many ways it creates an accountability muddle that leads to different tiers of government blaming the other for unpopular budget decisions.
The manifesto runs to more than 30 pages and includes a total of 42 discrete ideas. Its underlying premise is that, far from a 'silver bullet' solution, public trust can be restored only by conscientious and systematic attention to the detail of how government does business. Machinery that runs smoothly in a consistent, accessible, transparent, accountable way will in time pay a dividend in terms of enhanced public confidence.
Above all, the CIPFA Manifesto is about starting a debate. We want to encourage others – in particular the political parties – to put forward and test their ideas for securing better public governance and financial management and providing better public services. We need to encourage a focus beyond winning short-term votes to winning long-term respect, admiration and support for the way government does business.
Steve Freer is chief executive of CIPFA. The CIPFA Manifesto, Better ideas, better public services, will be launched at the annual conference in Manchester on June 23–25
