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Financial Management Initiative

Volume 114: debated on Tuesday 7 April 1987

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asked the Secretary of State for the Home Department whether he will make a statement on the effect on his Department of' the financial management initiative.

The financial management initiative forms part of the Government's continuing effort to improve the management of resources and obtain value for public money, and its effects are increasingly indistinguishable within those wider improvements. While much remains to be done, I believe that there has been a significant change of attitude and managements style within the Home Office, with much greater attention being paid to the costing of policies and functions and the setting of clear objectives and targets.Among the developments designed to strengthen accountable management in the Home Office in recent years have been : the establishment of the annual performance review, in which line managers and senior officials assess performance against previously declared objectives, and identify fresh objectives for the year ahead; the establishment of cost and responsibility centres around the office, to improve accountability in resource allocation; the provision of increased training in financial management; improved information about costs and output to provide a better basis for management and control; progress towards the introduction of clearer objectives and performance indicators in relation to local authority services and the greater use of accountants and other specialists.The head of the immigration and nationality department, and all prison regional directors and governors, have been allocated individual budgetary responsibility, and work is in hand to extend this principle to other parts of the Home Office. Some of these improvements are reflected in the targets and performance measures in the public expenditure White Paper (Cm. 56) and the evidence which the permanent secretary gave to the Public Expenditure Committee on 17 December 1986. Examples of better value for money in 1986–87 have been : the targets which were set and met for containing, and slightly reducing, in real terms the cost per inmate of operating prisons, and for reducing prison industry losses by over 20 per cent.; the targets for improvement in the procurement field which are forecast to result in savings of the order of £10 million; and the civilianisation of over 680 posts in police forces, permitting more effective deployment of police officers.