Treasury plans pandemic-driven update of spending control bible

Managing Public Money refresh will add guidance on emergency-related risk and more case studies
Cat Little appears before the Public Accounts Committee on 27 May 2021

By Jim Dunton

28 May 2021

The Treasury is planning to overhaul its key spending control guidance for accounting officers to reflect lessons from the coronavirus pandemic and include more case studies to aid decisions.

Cat Little, the department’s director general for public spending, told members of parliament’s Public Accounts Committee the update to Managing Public Money would include extra information on appetite for risk during emergencies and cross-departmental working.

Managing Public Money exists to help departmental accounting officers ensure ministerial spending decisions represent an appropriate use of taxpayers’ money – and gives them the opportunity to seek written ministerial directions authorising particular spending when there is doubt. The past 15 months has seen a spike in officials seeking such directions.

Little told MPs yesterday that while Managing Public Money had clearly “stood the test of time”, a recent review sponsored by the Civil Service Board and the Department for Transport had showed a need to update assessment guidance for accounting officers – who are often perm secs.

She said guidance on applying the 200-page document’s principles and tests in practice was a specific ask.

“While there are some good examples in Managing Public Money, what accounting officers have said is ‘we really want a repository of case studies that sets out the considerations’,” she said.

“We also think the guidance needs to be updated for how you assess your risk appetite in an emergency. What we’re talking about here is taking much greater levels of risk appetite upfront. Our risk-management framework in the orange book sets out quite a lot of guidance. So putting that in the context of accounting officer assessments is going to be really, really important.”

One area Little referenced was value-for-money in relation to spending on vaccines.

She added that another “really critical finding” from the review was a need for better guidance on spending in situations where multiple departments were involved in delivery, or where policy and delivery were undertaken by different departments – meaning multiple accounting officers had input.

“A good example recently that we had was testing in schools,” Little said. “The accounting officer of the Department for Education provided input for the Department of Health’s accounting officer assessment. That was probably one of the early examples of the way we formalised the way in which accounting officers worked together.

“Increasingly, these big cross-cutting issues need collaboration and accounting officers have to work together in different ways. That doesn’t necessarily change the fact that you have one accounting officer who’s ultimately responsible.”

Thursday’s evidence session was exploring the National Audit Office’s most recent Covid-19 Cost Tracker publication, which estimated the current cost of the pandemic to the nation at £372bn.

Little told MPs it would take some time to get the actual outturn data on coronavirus spending, which would come in the next two Whole of Government Accounts instalments.  She said the Treasury expected to publish “unaudited consolidated information” on government spending ahead of the normal publication of departmental annual reports and accounts this year.

Little said the plan to publish unaudited consolidated data ahead of accounts signed off by the NAO, reflected the reality that government was “running behind the normal schedule” .

Management of Covid business loans could be centralised

Treasury perm sec Tom Scholar told MPs the department had looked at the idea of bringing together the government-wide portfolio of coronavirus-related loans made to business, which total some £92bn, according to the NAO Covid-19 Cost Tracker.

His response came in answer to a question from PAC member Sir Geoffrey Clifton-Brown, who asked whether loans made under schemes overseen by the business and culture departments, among others, could be managed by a single department so that skills did not need to be duplicated.

“We have looked at that question,” Scholar said.  “We haven’t reached a view on it yet. Obviously these things are ultimately ministerial decisions, but it’s our job to look at them.”

Scholar said the idea had been explored as part of a broader review designed to ensure the Treasury had a “coherent response” to managing Covid legacy schemes.

He said the issue would be kept under review.


Coronavirus Finance
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