By Alison Scott | 8 October 2012
With the election of police and crime commissioners imminent, there are anomalies that need to be resolved – including the role of the two CFOs
November 15 is drawing ever nearer and with it the election of the first police and crime commissioners outside London. While the headline writers have picked up on individual candidates, little has been made of the much more significant change their election makes to the political landscape of England and Wales.
Although we have, for some time, had the option of directly elected mayors this has not been widely embraced. For the first time, oversight of an entire service will fall to directly elected individuals. Even in Westminster, prime ministers are still appointed due to their position as leader of the winning (or coalition) party rather than being directly elected.
The governance issues from this change are compounded by the very particular tripartite arrangement that operates in the police, with responsibility and accountability being shared between the police and crime commissioner, the chief constable and the home secretary. Unsurprisingly in the current economic climate, finance is at the heart of this relationship.
One of CIPFA’s main challenges has been to develop a statement on the role of the chief financial officer for police services. Translating the overarching statement into a world where both chief constables and police and crime commissioners are required to appoint their own chief financial officers brings its own complexity – especially when both are designated section 151 officers.
Consider for a moment what would happen if the police force CFO felt they needed to issue a section 114 notice. This allows them as a section 151 officer to act when an authority is either going to spend more than the resources available to it or enter into expenditure that is outside of its powers. In a wider local government context, the CFO would issue a report to full council, which would then have to formally consider their response. The whole process is in the hands of a single CFO and the report is considered in a public forum.
Within the new police arrangements, if the force CFO issued the report within its own legal entity only you could be in the strange position of the CFO of the PCC being completely unaware and the report going only to the chief constable with no requirement to consider the report in public. This is clearly not sensible or the underlying intention of the legislation.
Instead, the force CFO will need to consult with the PCC CFO at an early stage and, if a report is issued, issue it to both the chief constable and the police and crime commissioner. Similarly the PCC CFO would expect to consult with the force CFO before issuing the report to both parties.
However, what is interesting is that, excluding the external auditor, if the process stopped there, the section 114 report would be in the hands of only two individuals. Only one would be required to consider the report but this consideration would not necessarily be open to wider scrutiny. To bring transparency, the regulations require the report to also be passed to the Police and Crime Panel to ensure wider scrutiny takes place.
Many of the checks and balances in local authorities, including at present police authorities, come from the fact that major decisions are made and debated in public forums with councillors and police authority members representing a variety of different interests.
The Police and Crime Panel will provide public scrutiny of decisions but it is not the same as active debate over that decision-making by the primary decision makers. The two CFOs will have the challenge of ensuring that financial decision-making by the commissioner and chief constable is as robust and transparent as that open to debate and decision-making in a public forum. CIPFA’s Statement on the role of the CFO in police attempts to codify some of these issues and make sense of the new relationships that will need to exist.
It is vital that these CFOs remain at the heart of decision-making in the new organisations and have the resources to fulfil their roles. These relationships will inevitably develop over time and our Police Panel will continue to play an important role in ensuring that CIPFA can give CFOs the support they need.
Alison Scott is CIPFA’s technical manager for central government and financial management. CIPFA’s police conference takes place on October 3. See the CIPFA website for the Statement on the role of the chief financial officer in police
