Focus on public spending

THE EXPECTATION THAT governments will provide social services and take the lead in driving commercial activity is one of the major causes of high expenditure in the Caribbean public sector.
This observation was among the key points noted during a panel discussion that formed part of the Institute of Chartered Accountants of the Caribbean’s recent conference.
Dean of the Faculty of Social Sciences at the University of the West Indies (UWI) Cave Hill Campus, Dr Justin Robinson, said governments continued to provide the same social services today that existed years ago and may be spending on old problems that had already been solved, while also spending to solve new problems.
Putting it down to “a matter of political will”, he said that for fear of being voted out, no government was willing to challenge interest groups who would wish this to continue.
Acknowledging that any decision to cut expenditure would have a political component that couldn’t be ignored, he suggested some examination of the role of government may be necessary.
Dr Wayne Charles-Soverall of UWI Cave Hill’s Department of Management Studies said all efforts to reform public expenditure management had so far proven quite challenging.
“Departments are being asked to review, revise and be innovative and we have done on an incremental basis. And yet Auditor General reports point to repeated challenges, inconsistencies, gaps in reporting, et cetera,” he said.
Moving forward, he suggested, “we have to find a template that works for us and stick to that script.
“Perhaps if we take it from the perspective of being strategic, we may need to focus on some kind of coordinated effort to zero in on what needs to be done, set some targets, timelines and success factors we can point to show where we’re turning the page and achieving outcomes,” he said.
Meanwhile, Permanent Secretary in the special projects office of the Ministry of Finance Margaret Sivers in sharing Barbados’ experience in pursuing public expenditure management reform, said one of the critical cornerstones overlooked in the process is the people component.
Relating the phased approach taken to executing the project, she said the process involved moving from manual to electronic processes, moving from cash to accrual accounting, establishing a debt management unit and examining procurement.
In all this, she said, “we have to remember the people component. Some may question . . . we have professional accountants, why is expenditure management not getting better?”
To that she suggested: “At some point we have to stop and say no more new systems and ICTs. We need to look at if we brought our people along with us to deal with the new changes.
“We have to look at strategic planning, capacity building, exposure and experience of our people, so we have to look at management. It cannot only be public expenditure management by cutting costs. We have to look at leadership and improve on that and see how it can make a difference,” she said. (NB)