CIPFA manifesto makes calls for stronger PFM and long-term planning

6 Nov 14
Action is needed to strengthen public financial management in the UK to ensure the country is prepared for economic shocks and help restore trust in government, CIPFA has said today.

By Richard Johnstone | 6 November 2014

Action is needed to strengthen public financial management in the UK to ensure the country is prepared for economic shocks and help restore trust in government, CIPFA has said today.

Publishing its pre-election manifesto today, the institute said the fragility of the global economy and known demographic pressures meant the next government needed to plan for the long term.

The Manifesto 2015 publication stated this meant the next government should take a more strategic approach to how the UK invests to improve the management of the public finances in the medium to long term.

CIPFA chief executive Rob Whiteman said the country’s fiscal challenges were often simplified to the country not having enough money, but this was not the case.

‘The reality is that the ways we plan and implement policies and decide upon how we manage our resources are no longer fit for purpose,’ he said.

‘The system has become broken over many years as it has struggled to manage the increasingly short sighted political cycle which places more weight on success of an announcement in the media, than on the long-term interests of country and its public finances.

‘If we are to see a long-term sustainable financial future for the UK we need to radically reshape the way we run our public services and reshape our management of the public finances.’

Among the recommendations in the report is a call for increased governance and transparency, including a legal requirement for regular revaluations of property taxes such as council tax, as well as the establishment of an Independent Grants Commission to advise on methodologies and decisions on devolved funding. This should form part of a replacement for the Barnett Formula as the mechanism for funding distribution.

Public money spend on outsourced contracts should be made more transparent through a shift to open book accounting, but the report also said there could be greater role for private sector in service provision.


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