Productivity programme

Visa PaajanenNational Audit Office of Finland 6.10.2011

2

Backgroud

action plan 2003 to increase productivity

forecast: 2025 over 70 % of new recruitments to public sector

ageing => growth in expenditures

=> tax rate increases

2006 launched ”Government productivity programme”

3

Audits

NAOF continuous audit in this area, annually reported to parliamentFinancial audit: information on operational efficiency in final accountsFiscal policy audit: sustainability of financesPerformance audit: several audits - Implementation of government productivity programme and its

impacts- Implementation of gpp in the Ministry of Justice- Implementation of national IT projects in social and health

care- Preparation and management of gpp

4

Productivity programme

Programme concentrated on the input side: reductions in personnel

- use of information technology

- relocation

- service centres

general reductions in workforce, but also ”reallocations”

- not a ”cheese slicer” -programme

5

Incentives

in period 2007-2011

- 40 % savings remain in administrative sector

in period 2012-2015

- 75 % of savings remain in administrative sector

budget ceilings?

6

Measurement problems

Since 1996 Statistics Finland has developed measurement of productivity in public services

desribes changes in outputs and labour and overall inputs

from 2005 calculations for administrative sectors

productivity in public sector = productivity indicator

7

Audit findings

financial audit:

- gaps in productivity objectives and reporting

- positive development in setting objectives and reporting

fiscal policy audit:

- there is gap in sustainability of public finances

8

Audit findings, performance audit

productivity developed positively in 60 % of agencies

analysis in agencies better than average:

- main contributing factor was systematic development of activities

- most common measures were reorganising and outsourcing

9

Audit findings, performance audit

objective for reduction of personnel

- too much attention on labour productivity

- simplified picture of public sector productivity

- have functioned relatively well,

- created pressure to develop activities

10

Accountability

government programme – political and performance accountability

- NAOFs role: reporting to parliament

activities in ministries and agencies – financial and performance accountability

- NAOFs role: financial audits in agencies, risk based performance audit

11

Accountability and productivity programme

NAOF: reporting about productivity programme 2008, 2009, 2010 and 2011 annual reports

Annual report is in Audit Committee and plenary session

- several requirements to government (examples: IT, programme…)

reporting in Final Central Government Accounts

reform in programme 2011?