Public finance professionals ‘must take the ethical lead’

2 Apr 19

Public finance professionals have a vital role to play in building trust and resilience, the Scottish Government public finance minister has told CIPFA members.

Kate Forbes, minister for public finance and digital economy, told delegates at the Public Finance Live conference in St Andrews last month that it was the responsibility of those working in public finance to take the ethical lead.

“At a time when leaders are grappling with resilience, trust in public institutions and ethics, there is a unique role for those who work in public finance to lead the way – because our reputation stands and falls on the basis of one thing and one thing alone – and that is ethics,” she said.

CIPFA president Sarah Howard said there had been a “universal breakdown in trust” between government and the public. She highlighted a “staggering” recent survey of CIPFA members, in which over half of respondents said they had been put under inappropriate pressure to act unethically.

She also expressed concern over the rising number of interim roles within the profession, which suggested that people were not being attracted to senior positions on a permanent basis.

However, public sector finance professionals had the potential to transform that landscape. “It’s a great opportunity for CIPFA to flip that negative narrative, to start celebrating what is great about public service and to rebuild trust,” she said.

Brian Roberts, finance commissioner at Northamptonshire County Council, gave delegates an insight into the council’s “car crash played out in slow motion”. A siege mentality had developed, he said, in which there had been a lack of challenge from politicians and officers and an unwillingness to listen to external advice.

“A combination of financial pressures and poor governance is the perfect storm for a real crisis within an organisation,” he said, warning that Northamptonshire was unlikely to be a one-off. “There are wider financial sustainability issues and other local authorities showing some real signs of financial stress,” he added.

Roberts welcomed CIPFA’s Financial Resilience Index. The tool flags up risks to a council’s financial stability using aggregated statistics across indicators including reserves and budget flexibility.

Nedelina Ivanova, principal data analyst at CIPFA, told delegates that the index – which applies to councils in England but will shortly be rolled out in Scotland and Wales – would provide early warning to councils that action was needed.

“Without tools that are transparent and clear, other councils could face a similar fate [to Northamptonshire],” she said.

In a presentation on the role of budgets in promoting human rights, Alison Hosie, research officer at the Scottish Human Rights Commission, said human rights budgeting involved asking where money came from and maximising the resources available. “It’s not just about how you divide up the pie, it’s about questioning whether you have made the pie as big as it can be,” she said.

On the second day of the conference, Scottish Liberal Democrat leader Willie Rennie used his address to warn of “years of infighting and indecision” still to come over Brexit and to call for a public vote on the deal, including the option to remain.

“If even the Brexiteers can’t agree among themselves what Brexit actually means, what chance do we have of building that consensus in the wider world?” he asked delegates.

The event also celebrated achievement in public finance, with Fife Council winning the award for finance team of the year.

Derek Yule was named public finance professional of the year, and the emerging talent award went to Ross Fraser.

Did you enjoy this article?