Changing from Financial Control to Financial Management in the Public Sector: An Introduction to the Changes That Will Be Required

Introducing public financial management and internal control (PFM/IC) is a major organisational reform. It has significant managerial consequences, not least on the relationships between elected and appointed officials. Where the reform has been introduced it has frequently been treated as a financial and budgetary control reform but it has far more wide reaching effects if it is to be properly introduced. Not the least of the benefits is that PFM/IC provides an ability to put substance into the meaning of the terms ‘efficiency and effectiveness’ but that in turn requires significant managerial reform. PFM/IC ought to really be regarded as a managerial reform and it is from this perspective that the reform should be viewed. Managerial reform should be the starting point for implementation. Consequently, to achieve success top management commitment to the reform, by both political and senior appointed officials is essential.