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Leading figure calls for change within public sector

Writing a cheque (close-up) 3
Rebecca Kincade on December 18, 2013 - 1:58 pm in News

There is a critical need to build financial capacity and expertise in the public sector according to the Association of Chartered Certified Accountants (ACCA) deputy president and Director of Safer Communities for the Northern Ireland Department of Justice, Anthony Harbinson.

Addressing the global accountancy body’s fifth international public sector conference in London recently, Mr Harbinson stated that more capacity and expertise is needed to ensure openness, trust and accountability in public sector finances, adding that public sector finance professionals have an important role as custodians of the reputation of this essential sector.

At the event, Anthony Harbinson said: “Government spending on public services accounts for more than one-third of GDP in most countries around the world. Globally, the public sector is rapidly changing and the demands on public services are growing, together with the tax bill.

“Governments all around the world, including our own Executive, are wrestling with a number of complex challenges such as ageing populations and rising healthcare costs, reform of welfare support, provision of quality education, the environment and climate change, defence costs, protection of natural resources, terrorism, crime and infrastructure costs.  Strategic reviews of services need to take account of the changing world, whilst facing ongoing austerity measures.

“This is at a time when expectations of public services are growing and long-lasting improvements are being sought in the accountability and transparency of public funds.  There is a need for a change in attitude within the public sector, against a growing view that it is plagued by poor institutional fiscal management.”

Gillian Fawcett, head of public sector at ACCA commented: “The approach being adopted by Finance Minister Simon Hamilton is refreshing. While recognising the very positive contribution that the sector is making he is committed to delivering a more strategic approach on efficiency savings, making the sector more productive and efficient in the longer term. Going forward there will be less resource expenditure but more financial transaction capacity and a partnership approach with the private sector.”

Northern Ireland’s Finance Minister recently visited Denmark and Estonia to gain knowledge and expertise regarding best practice in the public sector. According to ACCA many European countries are in a similar position to Northern Ireland and there are lessons to be learned.

Ms Fawcett added: “Public services across Europe are facing austerity, not least here in Northern Ireland, with most budgets being cut on average by 25%. Given this environment, a common challenge in developing countries and emerging markets is the need to grow financial expertise and capacity and retain skills within the public sector.

“Without financial expertise, it is difficult for countries to develop the effective public financial management that will support growth.  An absence or lack of accountants also makes it difficult for governments to implement effective financial reporting based on accounting standards, as only technically trained staff can understand and apply the standards.

Concluding Ms Fawcett said, “I know that many countries in the developed and developing world are making significant improvements.  But much more needs to be done in improving many aspects of public financial management and financial reporting.”

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