Saving money is hard to do

There is a story in the Guardian today about how Barnet Council's plans to save money have cost more so far than it will save. You can see the story here. My experience tells me that this picture will be repeated around the country. When faced with saving money a chief executive or finance director can easily justify the setting up of a project or programme team and I have no doubt that they talk about this team "driving out" savings and "transforming" processes and a bunch of other consultant-speak. But the fact is that the estimated costs of such a team will be incurred from day one because salaries have to be paid, and if there are external advisors in the team (and often there are) they will send their bills in each month, whilst the savings may be achieved. Savings, though, usually require changes to be made by staff who are not in the project or programme team. This always takes time, and often there will be a battle about who gets the credit because if every department has a savings target they each want to claim as much as possible against their own.

A little less transparent

I sometimes give lectures about fraud and corruption in the public sector. It's a significant problem in the UK, estimated to cost something like £16 billion a year. Last year I came across a talk on www.ted.com by Peter Eigen who founded Transparency International, an organization that fights corruption on a worldwide basis, and have used it in lectures. You can see the video below.

Transparency International have just published their Corruption Perceptions Index for 2010. This ranks all 178 countries according to the level of corruption perceived in their public sectors. You can see the results here.

I suppose I am not surprised to see Denmark, New Zealand and Singapore at the top; or to see Somalia, Myanmar and Afghanistan at the bottom. However, the UK has only just managed to stay in the top 20, falling from joint-17th last year. Conjecture on my part would suggest the number of our national politicians have shown themselves to be more interested in what they could get out of government for themselves rather than what they could do for the public has contributed to our country being seen as less clean.

Two days to go

Colin Talbot of the University of Manchester has written this useful guide about what to look for in the Comprehensive Spending Review announcement on Wednesday. You can find it at his blog Whitehall Watch (http://whitehallwatch.org/).>

It's not about the money, then

Abolishing and merging of all these quangos announced by Francis Maude today is, it seems, to improve accountability rather than to save money. I processed the announcement from the Cabinet Office website through wordle.net to produce this word cloud. 

No mention of 'money' or 'savings' and 'spending' only appears because of references to the Spending Review.

More about Philip Green's report

Polly Toynbee wrote this article for the Guardian that highlights the unfortunate policy disconnect where Philip Green is recommending that government operates as a single, enormous purchaser of goods and services whilst David Cameron and co want to decentralise everything.

Getting the basics right

It is disappointing that Philip Green's report about government efficiency shows that central government department's aren't doing the basics but I suppose it is not that much of a surprise since it is only in the last few years that they have hired qualified accountants to manage their finances. And, as a colleague accountant said to me a few weeks ago when I asked him if he felt safe in his (local government) job, "when times are difficult they usually want more finance managers, not less." It looks to me like central government needs to broaden and deepen its financial and commercial management skills.