Money calculator

Accountability & transparency vital in public sector finances

By: Gillian Fawcett, Head of Public Sector, ACCA
Published: Tuesday, December 24, 2013 - 07:00 GMT Jump to Comments

There is a critical need to build financial capacity and expertise in the public sector in order to ensure openness, trust and accountability in its finances.

With government’s spending on public services accounting for more than one-third of GDP in most countries around the world, public sector finance professionals have a role as important as custodians for the reputation of this vital sector.

Globally, the public sector is rapidly changing and the demands on public services are growing, together with the tax bill.

At a time when austerity measures are still biting and public services across Europe are facing huge cuts, a common challenge is the need to grow financial expertise and capacity and retain skills within the public sector.

This is particularly valid in the UK, where most public services are cutting out on average 25 per cent of their budgets.

It is not just austerity that public services have to contend with either. The toxic mix of ageing populations, rising healthcare costs, reform of welfare support, and infrastructure costs are all complex challenges that governments are attempting to navigate.

This is at a time when public expectations of public services are growing along with a desire for transparency and accountability in the way public funds are handled.

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.

At ACCA’s recently held fifth international public sector conference Financial Reporting for an Open World, Anthony Harbinson, deputy president of the Association of Chartered Certified Accountants, said there was a view “that the public sector is plagued by poor institutional fiscal management”.

This, he says, is “exacerbated by issues of poor public financial management and reporting”. 

In economies where accountability structures are underdeveloped, the above could be held to be true, especially where there appears to be a lack of political interest in reform.

Although trust in public services is falling in some areas, many countries in the developed and developing world are making significant improvements.

However, much more needs to be done in improving many aspects of public financial management and financial reporting.

There is an urgent need to build financial expertise in the public sector. Accountability and transparency are central to public sector finances – only with this expertise can governments ensure openness and trust.

Gillian is Head of Public Sector for ACCA Global responsible for developing international policy on technical matters affecting finance professionals in public services

The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the official policy or position of The Information Daily, its parent company or any associated businesses.

Comments

Latest

Our fair trade organisation, Traidcraft, has just launched its Justice Campaign. The campaign is calling for the…

The impact of chronic illnesses continues to rise in the United Kingdom. The World Health Organisation estimates…

RealityBites - The National Healthcare Conversation moves to Tuesdays and takes on the future of general practice.…

Britain has a habit of funding new museums and attractions, when it would often do better to support and renovate…

The best way to track developments in UK’s local authorities is through the work of local journalists. A…

It makes sense for CCGs to have a bigger role in commissioning but they will need the oversight of NHS England…

The quarterly Enterprise Tracker report produced by RBS in association with UnLtd shows that UK social entrepreneurs,…

There needs to be a grown-up consultation with the public about how patient data is handled, says Tony Davis,…

Do you do digital? Take the test

The Information Daily is collaborating with Socitm to research organisations' commitment to and capability for a digital future.

Take the test

View Results

If you have already taken the test, you may view the latest detailed results by entering your email address below


Headline results so far: Results from 108 users

Corporate commitment: 46%
0%
100%
50%
Digital capability: 53%
0%
100%
50%

As a clinical consultant representing a proprietary software supplier in healthcare, you may be surprised to hear…

The way the NHS pays rent to GPs must be made the top priority for the new co-commissioning agenda or the shortage…

Raytheon will receive nearly half a billion pounds for its work on the cancelled eBorders project, but it was…

In 1948, responsibility for social care was handed to local councils and the medical stuff to the NHS. Now the…