IT was Edward de Bono who observed that we live in a critical society where, from a very early age, we all learn that it is far easier to criticise than it is to be constructive. He must know Jersey well.

The Comptroller and Auditor General, Chris Swinson, certainly knows the Island well, even though he doesn’t live here, and he has built up an intimate knowledge of how the States administration works, or in many cases, doesn’t work.

So his recent comments on the quality, or otherwise, of financial management in the States has to be taken very seriously.

He also doesn’t write reports – even very short ones – unless he feels they are necessary, so there was obviously a message that he wanted to put across in his recent paper. Whether that message was highly critical or not depends on your viewpoint.

That message, according to some observers, is that financial management in the States is rotten and needs improving.

Now it’s obvious that the CAG, if I might call him that, was not just trying to be critical because he also suggested many improvements.

Unfortunately, there is a wafer-thin line between pure criticism and constructive criticism, and some might think he has overstepped this line in some of his remarks. Certainly States critics would firmly place his report in the category of ‘Damning Criticism’.

However, what might appear to be a highly critical report, may simply be observations on how difficult it is for a small, cash-strapped administration to adopt the latest financial management techniques. If that is what the CAG intended, it is the failure to make that clear that caused him to overstep the mark and present the critics with more ammunition.

So the critics gleefully latched onto one small passage in the report which says that ‘lack of discipline in financial record keeping has assisted departments in obscuring their cost profiles and this has been regarded by some as convenient’.

We even had one of the Angry Men claiming in this newspaper that this proves that he and his colleagues were right in their absolute and relentless belief that the States don’t want to control their spending. What tosh!

On the face of it, that tiny paragraph does indeed give the impression that the CAG is accusing all States departments of poor financial record keeping in order to hide inefficiency.
In a small administration that nevertheless spends over £500m a year, there are bound to be some departments that perform better in this area than others. But the CAG appears to have damned all States departments. Did he really intend to do that? If he did then we really do have a problem, but I doubt it somehow.

Secondly while the CAG obviously has an unshakeable belief in the benefits of much more effective financial management throughout the whole administration, others might think that the current approach suits a small jurisdiction just as well.

He says that proper financial management is not just record keeping or the provision of financial information, which is what the Treasury and Resources department does now.
‘Successful financial management should involve all of the senior management of an organisation and cannot be achieved by delegating all financial responsibility to a finance department or to a single officer.’

Isn’t that what senior management is doing now? Do we really need to employ a whole raft of new bean counters? Indeed could we afford to do so?

The CAG’s report might give the impression that financial management is pretty low in the priorities of States employees. On the contrary, I suspect that financial management is now considered so important that it’s becoming increasingly difficult for some States departments to do their job properly.

For example, I would suspect that if you asked any of the very small number of administrators running the extremely busy Education department (which the CAG has pointed out is under-resourced) to take on even more of a financial management function as well, then some of them would probably head for the door.

After all, when you fight your way through all of the jargon of ‘managing stewardship, supporting performance and enabling transformation’, the basic function is pretty simple. It’s to provide Islanders with the essential services that they demand without taking too much money from them.

We all know that it’s horrendously difficult to achieve, and while more financial management resources would undoubtedly help, it might not be the solution to the problem. It’s also questionable whether it would be worth the cost. Just imagine what States Members would say if the plan was to employ more accountants and other bean counters instead of more nurses, teachers, doctors, and policemen.

Indeed, the suggestion from the CAG that we need more pen pushers must have turned some of the Angry Men into Apoplectic Men.

But perhaps they missed that bit of the report in their enthusiasm to find more criticisms of States spending.
Peter Body is editor of
Business Brief magazine