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A view from the Board Table

A view from the Board Table. Simon Judge Finance Director, DCMS simon.judge@culture.gsi.gov.uk GFP Trainee Conference Brighton 10 July 2009. What am I going to talk about?. Myself How I qualified (and why)

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A view from the Board Table

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  1. A view from the Board Table Simon Judge Finance Director, DCMS simon.judge@culture.gsi.gov.uk GFP Trainee Conference Brighton 10 July 2009

  2. What am I going to talk about? • Myself • How I qualified (and why) • My current job and some of the challenges, based loosely around my first impressions, and attempts to set some priorities • Reflect on what these challenges might mean for you today, at your stage in your career. I am assuming you aspire to something • Questions and comments

  3. My experience to date • Maths degree - very useful. • HM Treasury - wide range of jobs, including poll tax, privatisations, VAT, IT • DWP - various Spending Reviews • DCA - merger (with part of Home Office) to form MoJ

  4. Project management – creating MoJ

  5. My experience to date • Maths degree - very useful. • HM Treasury - wide range of jobs, including poll tax, privatisations, VAT, IT • DWP - various Spending Reviews • DCA - merger (with part of Home Office) to form MoJ • DCMS - the finance director (not “a”) • Small department - only 500 people. On the edge of viability - read our capability re-review. 20 in finance • About 60 NDPBs and other bodies, most with own Accounting Officer • I think I am supposed to lead the finance function across them all - some bigger than we are, some are better run • £1.5 billion resource, and £200m capital – tiny share of the budget

  6. Benefits & tax credits AME £270 bn DCMS Debt Interest DEL £340 bn DCMS within total public spending

  7. My experience to date • Maths degree - very useful. • HM Treasury - wide range of jobs, including poll tax, privatisations, VAT, IT • DWP - various Spending Reviews • DCA - merger (with part of Home Office) to form MoJ • DCMS - the finance director (not “a”) • Small department - only 500 people. On the edge of viability - read our capability re-review. 20 in finance • About 60 NDPBs and other bodies, most with own Accounting Officer • I think I am supposed to lead the finance function across them all - some bigger than we are, some are better run • £1.5 billion resource, and £200m capital – tiny share of the budget • Olympics (£9.3 billion programme), BBC (£3.3 billion), Lottery (£1.7 billion) all on top. I only get involved when things go wrong

  8. Getting qualified ... Why and how? • Lots of experience - but wouldn’t get a board level job • Chose the Warwick Business School / CIPFA route • See article by David Wright (DWP) in Trainee Gasette No 1 • Warwick diploma: • how to be a social scientist. Useful for many more senior managers - strategy, leadership, governance • learn to write an essay • learnt how to walk around a problem • research-based dissertation • Manageable finance element: investment appraisal, tax and financial accounting. Governance module most useful to me so far • Friendly and small group. Graduated on Monday

  9. Some newly-qualified accountants ...

  10. Some newly-qualified accountants ...

  11. Getting qualified ... Why and how? • Lots of experience - but wouldn’t get a board level job • Chose the Warwick Business School / CIPFA route • See article by David Wright (DWP) in Trainee Gasette No 1 • Warwick diploma: • how to be a social scientist. Useful for many more senior managers - strategy, leadership, governance • learn to write an essay • learnt how to walk around a problem • research-based dissertation • Manageable finance element: investment appraisal, tax and financial accounting. Governance module most useful to me so far • Friendly and small group. Graduated on Monday • CIPFA final test: case study. (What does it test ?)

  12. So what are the issues ? • Get organised • Keep learning • Governance and culture

  13. Issues (1) – get organised • Manage your boss - “management review”, “sign off return to HMT”, escalate stuff when you get stuck, help us to prioritise (eg technical assistance to our NDPBs) • Customer focus - some basic disciplines on solving problems. Know a bit about a lot across corporate services • Learn how to manage change projects. Backward planning, take some risks (eg CSR/SR), acknowledge we are less than perfect, but accept less than perfection

  14. The starting position USELESS WORLD CLASS

  15. The starting position Internal controls Statutory accounting USELESS WORLD CLASS In-year reporting and control Forward planning

  16. The starting position USELESS WORLD CLASS

  17. The new FD arrives .... USELESS WORLD CLASS

  18. ... then common sense breaks out USELESS WORLD CLASS

  19. Issues (1) – get organised • Manage your boss - “management review”, “sign off return to HMT”, escalate stuff when you get stuck, help us to prioritise (eg technical assistance to our NDPBs). • Customer focus - some basic disciplines on solving problems. Know a bit about a lot across corporate services • Learn how to manage change projects. Backward planning, take some risks (eg CSR/SR), acknowledge we are less than perfect, but accept less than perfection • Make finance interesting, useful, andconsequential - eg risk management • Write policies, design systems, or understand and tackle culture? Where’s the leverage? • Sit at your desk, or get out there and talk to people? • Look for quick wins and for people to be defenestrated

  20. Issues (2) – keep learning • Work with other specialists eg economists, lawyers, statisticians, estates, HR, procurement, communications etc etc • Welcome others into finance – don’t be an exclusive priesthood • Look at how others simplify issues. Jargon is not always necessary, and not always helpful • Look at other organisations – both similar and different. Not necessarily hugely time consuming. Feed thoughts back on how might do things better here • Do a non-finance job, for a bit • Learn about public sector finance systems

  21. Issues (3) – governance & culture • Understand how your organisation is supposed to work, and how it does work in practice. If you don’t know, ask and keep asking. Confusion leads to understanding • Governance disciplines are important – tend to reside in finance (but not mandatory) – for example in DCMS loads of others need to get involved • Think about trust, versus formal accountability • Be clear what you do and what you don’t. This requires resilience (and good customer care skills to say “No”) • Understand what the FD role really is – eg importance of single set of books, and of key financial judgements (slippage). Look for areas where FD/ you can be a bit awkward – eg retrospective approval

  22. Conclusion • Doing a formal qualification is useful – but not always in the areas you expect • Finance is interesting and you must make it so for non-experts. The function is crucial to running any organisation, and planning its future • Reflect on you learn stuff, how you think about issues, how you behave with colleagues, customers, senior managers • What does that mean for your skills gaps and how you behave? What are you going to do about this? Harry can help!

  23. Conclusion • Doing a formal qualification is useful – but not always in the areas you expect • Finance is interesting and you must make it so for non-experts. The function is crucial to running any organisation, and planning its future • Reflect on you learn stuff, how you think about issues, how you behave with colleagues, customers, senior managers • What does that mean for your skills gaps and how you behave? What are you going to do about this? Harry can help! • Questionsand comments please simon.judge@culture.gsi.gov.uk

  24. Tax and spend as a share of GDP CSR SR

  25. CSR SR CSR SR Public spending - capital & current Public sector net investment will fall to 1¼% of GDPby 2013-14. Proceeds from additional assets and property sales available to supplement capital budgets Current spending will grow by 0.7% in real terms each year in next SR (2011-12 to 2013-14). [1.8% at Budget 08: 1.2% at PBR November 2008] Additional efficiency savings allowing the Government to focus resources on front-line public service priorities. .

  26. What does 0.7% mean for DCMS ? Benefits & tax credits DCMS Debt Interest DEL £340 bn 2009-10: pages 239-41

  27. What does 0.7% mean for DCMS ? Benefits & tax credits AME £270 bn DCMS Debt Interest DEL £340 bn 2009-10: pages 239-41

  28. Response (1) - in the CSR period • £5 billion extra value for money savings in 2010-11 -- announced in the Pre-Budget report. • Detailed split in the Budget (pages 129-132). • DCMS contribution is £20m - our fair share. • Secretary of State has written with details to the organisations affected, setting out his approach. • Also toughening of policy on public sector pay, including for NDPB Chief Executives (page 127). • Reviewing capital budget, which is over-committed in CSR period, and creating new Investment Committee. Need urgently to look forward to next SR period. • Maximising DCMS contribution to skills & jobs agenda (page 95)

  29. Response (2) - Operational Efficiency Programme (OEP) • Launched a year ago: five strands(page 122) • Collaborative procurement (Martin Jay) - £90bn in scope. • Back office operations (Martin Read) - £18bn, plus £16bn on IT. • Asset sales (Gerry Grimstone). • Property (Pat Carter) - £25bn in scope (plus disposals). • Budget “bakes in” savings of £15bn a year, to be delivered by 2013-14, across the public sector • Common and strong themes: management information, incentives, accountability, expert support • DCMS action, as discussed at NDPB advisory board: • Procurement Council (Steve Morris, British Library) • Benchmarking (Chris Walker, UK Sport) • Building a (useful) financial model to 2013-14 (Discussions with Museums: understand cost and income drivers). • July strategy for back officeoperations

  30. Response (3) - Public Value Programme • Programme launched a year ago • NHS commissioning, teaching assistants in schools, NEETs, RDA management, prison management (page 125) • Need to extend this to cover 50% of DEL, with focus on spend that impacts across departmental boundaries • But also some scope for looking at AME (eg benefit spending and public service pensions - page 128) • Just starting now to scope these reviews in DCMS • Need to start in June, and complete by the end of 2009 • Best not to organise on an institution by institution basis

  31. Response (4) - the next Spending Review It’s all rather unclear … • Period covered - assume 2011-12 to 2013-14 • Overall fiscal position: DEL and AME envelopes not yet set • Timing: when it starts, when decisions are taken, when announcements made • Nature of engagement with departments and other organisations we work with. Bottom-up or top-down? • The key themes? Relevant to building the evidence base. • Likely scope for changes to the control framework (e.g. museum reserves)? … so all involved need to be ready for anything.

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