As the FT notes this morning:
The Treasury is poised to scour the nation's boardrooms as it searches for a new finance chief able to inject corporate-style rigour into Whitehall's management of public finances.
Corporate style rigour? Of the sort that brought the banks to the brink of failure I presume? And of the sort that means that International Financial Reporting Standard based accounts do not anticipate losses? Or which results in the Financial Reporting Council saying bank audits were universally 'below average' (which is, of course, an oxymoron).
Yes, this is, apparently, what the Treasury is looking for. The FT added:
Danny Alexander, chief Treasury secretary, will on Monday announce the creation of a senior post, akin to a company chief financial officer, with a brief to look beyond departmental fiefdoms and make strategic judgments about spending priorities across the whole of government.
So this new demi-god of finance will scrutinise all finance. But when parliament itself does such things people like the Institute of Chartered Accountants in England and Wales criticise it for doing so. Let's presume then that this oversight may well take the form that most accountants are only capable of understanding, which is about cost cutting and not about investment, or quality, or even increasing revenue, which in this case would mean closing the tax gap.
There is much finance might bring to government. But I suspect there's almost nothing the average corporate finance director could add that would be of any value at all to 99% of the people of the UK, not least because they're not trained to do that. And that's what's so worrying about this idea.
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Here’s another two words to best describe who the government are a pursuing …”Corporate Cockroach”
I guess we could test this theory by evaluating attempts to bring corporate-style rigour by bringing in private sector business people to, say, the Board of HMRC. Are these people very average? Is the value of their contribution zero? We may need to allow for the value of a contribution to be negative.
Shall we look at the consequences of doing so
Let’s start with one word: Vodafone
Then try two: Goldman Sachs
Then try three: Google, Amazon, Starbucks
Need any more evidence of the behavioural consequences of using the wrong model?
You can’t run a government like a business. A business can increase efficiency and maybe in so doing make a few people redundant. It doesn’t have to worry about what happens to these people. Government’s adopting the same attitude. It’s completely inappopriate.
Quite.
99% redundancy.
Maybe they´ll outsource government to India, starting with the mentally redundant 650?
I want to see what happens when their industrial guru/s tells them that halting the corporate welfare benefit is the way to go..
I think there are quite a few good accountants in the real economy who aren’t involved in printing money or mispricing debt. The problem with accountants is that they are trained to follow rules and stick to their brief. Most of the time this is good although we are well familiar with the exceptions. I would bet that, given a brief to tackle youth unemployment, build more houses, reduce the cost of public debt, or finance more infrastructure spending, many accountants could come up with practical ideas. The problem is the idealogical constraints imposed by politicians and inflexible economic theories.