The UK’s Comptroller and Auditor General (C&AG) and head of the National Audit Office, Gareth Davies, has urged government to tighten its financial management.
His comments align with those of the Institute of Chartered Accountants in England and Wales (ICAEW), which has repeatedly highlighted the need for stronger financial disciplines across the public sector.
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In his annual address to parliament, Davies set out key elements of financial management that he believes would support better decisions in Whitehall and improve value for money.
Davies said: “Managers often do not have access to the activity cost information they need to drive efficiency and performance. Government systems are set up to control spending within budgets, not to help managers manage.”
This comes after the ICAEW argued that professional accountants are central to raising standards in government finance, a theme explored in its Better Government Series.
The institute raised similar concerns in its 2013 report entitled A CFO at the Cabinet Table, which noted: “Departments focus on managing budgets within an agreed spending limit rather than managing costs.”
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By GlobalDataThe organisation has consistently called for a long-term fiscal strategy to place public finances on a more sustainable footing, alongside stronger financial management throughout the UK public sector.
ICAEW senior technical manager, public sector team, Henning Diederichs said: “As the UK Government’s external auditor, Davies is right to highlight the importance of improving public financial management and ensuring the public sector has the skills and capability needed to support effective financial decision-making, and in embedding a culture of continuous improvement.
“We believe there is a need to augment the perceived value of financial reporting and external audit within the public sector and to demonstrate that strong financial oversight and better financial information can improve operational performance and resilience.”
