Central government has made progress in modernising its
finances in the past five years, yet it’s still a difficult sell to persuade
finance directors with commercial experience to join the public sector.
The obstacles to poaching the best talent from the private sector have come
into stark relief over the past two years as the government struggles to fulfil
its target to recruit professionally qualified finance directors for each of the
45 departments by the end of the year.
With just three months left, the government is still 12 FDs short of
achieving its target, according to the latest data from the Treasury, which
declined to name the departments that are yet to appoint a qualified FD.
Opposition MPs are appalled that it has taken this long to ensure government
finances were managed by qualified people. Liberal Democrat MP Stephen Williams,
said he was astounded that it had taken until now to hire professionally
“The government was boasting about how much better it had got at managing
public finances, but I was astounded that it had never had FDs in place before
now,” he says.
Government has had some success, albeit at a more measured rate compared to
private sector recruitment. The most recent appointment was Hunarda Nouss at the
Department for Communities and Local Government. Nouss, who moves from the
private sector, took up her post as FD in September.
Departments have stepped up attempts this year to recruit or train FDs. In
April, there were only 27 fully qualified FDs, while by June they had reached
roughly 73% of the target.
It seems the main attraction for most isn’t the remuneration, although the
defined benefits pension is much better than you’ll get in any private sector
company these days. Recruiters say salaries still aren’t as competitive as they
should be to attract the best people. The driver for most senior finance prof
essionals is rather the agenda for change, and making an impact on society.
Both Barbara Moorhouse, FD at the Department for Constitutional Affairs, and
Helen Kilpatrick, director of finance at the embattled Home Office, cite the
opportunity to play a part in overhauling government finances and ensuring the
British taxpayers get value for money in public spending as fundamental in their
decision to take on their roles.
Mary Keegan, managing director, government financial management at HM
Treasury, and Moorhouse are two of the most high profile coups from the private
sector. Moorhouse was CFO at technology companies Kewill Systems and Scala
Business Solutions, while Keegan was previously chairman of the Accounting
Standards Board and previously partner in charge of the financial reporting
division at PricewaterhouseCoopers.
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Other recent private sector appointees include Mark Clarke, brother of former
Home secretary Charles Clarke. Clarke became director general, finance and
strategy group at the Department of Trade and Industry this summer. He is the
first professionally qualified FD the department has ever had.
Clarke was previously finance director of Barclays, Abbey and the Bank of
Ireland, where he was UK FD. He was also the director of PricewaterhouseCoopers’
management consultancy practice.
Making the transition
Many senior finance directors, although interested in playing a role in
central government, are often put off because of the difficult transition back
to the private sector after a stint in government. The only FD to have achieved
a smooth transition is Simon Ball, currently CFO at 3i, who was previously
director of finance at the Department for Constitutional Affairs.
John Collier, accountant and consultant at executive search firm Clive &
Stokes, says: “I would encourage more moves between the sectors. But the public
sector has to make itself more competitive and the private sector must realise
that you can get real value from an appropriate government department.”
To maintain a balance, the Treasury has also been careful to ensure internal
promotions. This summer, Stephen Jones, director of finance at HM Revenue &
Customs, and Richard Calvert, director of finance and corporate performance at
the Department for International Development took the new fast track route to
gain their accountancy qualification.
As Tory MP Justine Greening recently told Accountancy Age, “Accountants are
ideally placed to understand what sorts of business case we should expect to see
from politicians and government.”