|Editor's Note: From 1999-2000, with
the agreement of the Legislative Council's Finance Committee, five departments have been
operating on a one-line vote on a pilot basis. We have invited the Controlling Officer of
one of them, the Intellectual Property Department, to share with us his experience in
managing resources under this arrangement. Mr Stephen Selby's useful comments,
particularly the financial monitoring he has put in place and the extent of senior
management involvement, will certainly help us gain Finance Committee support for rolling
out the one-line vote to more departments from 2001-02. Indeed, we have written to all
five pilot departments to seek their feedback in preparation of a submission to Finance
Committee. We will keep you informed of progress through Finance Bureau Circular
Memorandum or this Newsletter. In the meantime, for those departments that wish to switch
to a one-line vote, you may find Mr Selby's experience relevant. We will certainly advise
you to consider putting in place similar internal monitoring and staff involvement
Evolving into the One-line-vote System
Once upon a time, when dinosaurs ruled the world and enormous insects hovered over the swamps, there must have been one-line-votes. Actually, I seem to remember them from my days in Finance Branch in the 1970s.
Then things got more complicated. Departments didn't seem able to manage their financial affairs (because no one was training their staff to do so) and the all-pervasive eye of Finance Branch did not seem to be able to reach into the everyday affairs of Government departments. So Heads sprouted sub-Heads and sub-Heads sprouted items. Dinosaurs did not become extinct: they just evolved into smaller dinosaurs.
Now one-line votes are back - at least on a trial basis. The Intellectual Property Department is one of the departments taking part in this experimental walk in Jurassic Park.
Actually, the one-line-vote does not change all that much: departments get to transfer resources between Salaries and Allowances and General Departmental Expenses (something that Finance Branch would normally approve on application anyway). You can't transfer resources between capital and recurrent heads (because doing so would make nonsense of the concept of capital expenditure.)
But taken together with recent policies on employment of contract-based, non civil-service staff, the one-line-vote makes a lot of sense. We are no longer (for the moment) employing permanent or contract civil servants (paid for from the salaries sub-Head.) Instead, we are employing non-civil-servants paid for from General Expenses sub-Head. In this transitional stage, at least, it may become necessary to re-deploy resources between the sub-Heads to accommodate the change of practice.
As one of the five departments taking part in a trial scheme for operating the one-line-vote scheme, we have combined the implementation of the one-line-vote with other changes in our financial control.
The first is the monthly financial control meeting. At this meeting, the head of the department meets with the Administration Unit (which runs our accounting) and a group of executives who are directly involved in day-to-day management of expenditure and staffing. We look at reports from our Departmental Secretary on the recurrent account. Simply speaking, we look at expenditure patterns and decide whether to make any changes to our original patterns of estimated expenditure.
What do we gain from that? First, we get a better feel for how we are performing. After spending time together looking at spending patterns (or the lack of them) our decisions on EPP savings and proposals for the annual RAE exercise become obvious, rather than being a matter for last-minute soul-searching. In fact, EPP becomes a monthly exercise rather than a yearly one, which makes it much less daunting.
Our regular meetings and decision-making on the one-line-vote exposes a group of our key executives to financial control in a way that never happened before. It is a very good way for our departmental administrative staff to pass on expertise in a practical environment. It helps de-mystify the budgeting process.
Another thing that happens in our monthly meetings is that we monitor our major capital items. Our marketing budget is accounted on a capital basis and the middle-ranking executives who manage our marketing on a day-to-day basis find it a real eye-opener.
This is the first year of the one-line vote pilot. It does not surprise me to hear that some departments are operating one-line-votes but have not yet taken advantage of it to redeploy funds. If the year's Estimates were originally prepared without the one-line-vote in mind, there will probably be no call to redeploy resources.
But in 2001-02 we shall not seek additional funds in the RAE: we shall just work within the funding for the present year, knowing we have the flexibility to move things around the recurrent vote. We have also used our monthly meetings to identify savings to squirrel away in our Save & Invest account for the future, so the risk of having too little next year is remote.
Managing our department's finances with a one-line-vote would not have been a big deal if we had not changed our whole approach to financial monitoring in the department. You cannot take advantage of the one-line-vote feature if you don't monitor spending regularly; and you don't get the best results if you don't involve a decent range of staff in the exercise. But with the flexibility of the system, we expect
* To find EPP savings without pain;
* To make the RAE exercise intuitive and easy;
* To budget next year's expenditure well within this year's resource levels.
Ms Stephen Selby
Director of Intellectual Property