What are the principles of managing public money?

I’m working on an online course about the principles of managing public money. The course is aimed at everyone in the public sector, whether employees, politicians, volunteers, etc. I want it to be a great course that is valuable to the people who register for it. I’ve got over thirty years’ experience of managing public money and there is a temptation to cram all my knowledge into a single course, but that would not be a good idea.

There’s not a technology reason why I could not have a course comprised of hundreds of lessons that would take the learner many weeks to complete. There is, I think, a practical limit on what a person is willing to take on, especially if it is additional to their work commitments. This means that one of my challenges is to find the balance between including enough material for the course to be valuable without going into too much detail and becoming onerous — or worse, boring. I’ve spent quite a bit of time, therefore, deciding what to include and what to exclude and I’ve had to delete some sections and ideas that I would like to teach in order to keep things focused.

The platform I am using for my courses allows lessons to be grouped into modules. I think five modules, each taking one to two hours to complete is about right. This is something someone could complete in a day if they really wanted to, but more likely they could complete it over 1 to 4 weeks to fit with their schedule.

The five modules I have now decided on are set out below.

1. The big picture—to cover what the public sector is for and the differences in financial management between the private and public sectors.
2. The principles of funding public services—so that learners understand why some services are funded from taxes whilst others charge fees to users
3. The fundamental importance of the budget in the public sector—because it is.
4. Principles for making decisions about spending public money—in order to get the best possible public services in terms of value for money.
5. Being accountable for the use of public money—because anyone who handles public money has to be willing and able to account for what they did and what they did not do.

These are my thoughts on grouping the course into modules. I would be interested in hearing your thoughts and observations in the comments section.

If you’re interested in this course you can sign up for my mailing list and be the first to know when the course opens for registration by clicking here.

Become a friend of Ibba Girls School and help girls in South Sudan to finish their education

I am the treasurer of a charity in the UK, the Friends of Ibba Girls School, which exists to build and operate a school for girls in the southwest corner of South Sudan. As well as being the world's newest countries, South Sudan is one of the poorest and most fragile. We all know that education improves the life chances of children and, in practice, their families, too. That's why it is important that Ibba Girls School, and the other schools in the country, exist.

If you have two minutes to spare, here's a video about the school featuring some of the girls whose future we want to enhance.

Building and running a school in South Sudan is not cheap. There are 200 girls currently getting an education at the school and because it is a boarding school, they are also being fed and kept safe as well. As a charity we need to raise GBP25,000 a month to keep the school running. If you want to make us a gift please visit the donation page on our website.

Principles of managing public money: step 1, the mind map

Following on from last week's blog post I have been working on what should be included in an online course about the principles of managing public money. Below is a snapshot of the mind map I've produced so far.

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Mindmap of contents of principles of managing public money course

I like using mind maps for this kind of work. I used to do them with pen and paper but software like Mindnode is so much better. First, if you make a mistake or change your mind you can correct things without crossings out. You can also move items between branches in an instant. Even better, the Mindnode app is on my iPhone and iPad as well as my desktop Mac so, using the power of iCloud, I can access any mind map wherever I am and with whatever device is to hand. This means that if I have an inspirational thought whilst in a supermarket I can quickly add it to the mind map and it will sync to all the devices.

Typically a project like this course, or a long piece of writing, will stay as a mind map for several days, perhaps a week, before I export it into Ulysses (my favourite software for writing) as an outline. I don't keep working on the mind map until it is perfect because I've learned over the years that products need to be good enough, not perfect. Once the outline is in Ulysses I can continue to make tweaks and improvements.

I started off with about 10 branches in the mind map but I realised that would make a course that would be too long. I envisage this being a course that could be completed in a handful of hours because it is just an introduction. A course that could take 10 or more hours to complete is likely to see a high level of drop-off and I would rather students finish the course (even though from a commercial point of view there is nothing for me to gain from it). The challenge for me, therefore, was to keep working at the mind map until I could get it down to five branches, each representing a topic within the course.

I felt that the first section of the course had to be about the big picture--i.e. what is the same and what is different about financial management in the public sector compared with the private sector. I also knew that the budget had to be a topic because it is so fundamental to the way that public bodies operate. That left me with a maximum of three more topics. The ones I have identified are:

• the principles of funding public services, because I think it would be helpful to understand some of the issues relating to taxation and when it might be appropriate to fund services from user fees instead of tax
• principles for making decisions about spending public money, because public managers need to make decisions and they should have some understanding of the concept of value for money
• accounting for public money, because there is a general interest in accountability and transparency and I want students to understand what financial reports do and don't communicate to the reader.

I'm interested to hear your comments. Do you think I've focused on the right things, or are there topic areas you think should be included in the course? Let me know in the comment box below.

If you are interested in this course please sign up to my mailing list to be kept informed of its launch date, etc.

Creating an online course about managing public money

For several years I have been thinking about doing less consulting work and making a living from selling products instead. The beauty of selling products is that it is unconstrained. When I work as a consultant, or as a teacher, I can generally only be paid for the time spent on the project. I have tried, and sometimes I succeed, in selling my service at a fixed fee, which gives me an incentive to work faster rather than slower, but many of my clients seem to see this approach as too risky. Essentially, that puts a limit on what I can earn because I can only sell my time once. Selling products, on the other hand, does not have that limit: the limit is the demand for the product at the price being charged.

As I said, I’ve had that on my mind for a few years and this year I decided to do something about it. The products I want to sell are online courses, books, e-books and coaching that are focused on various aspects of managing public money. Earlier this year I wrote a blog post about my online school and the free mini-course I created (Five Questions To Ask About Your Budget).

This week I made a start on creating my first paid-for course. It is a course aimed at anyone working in the public sector who wants to know more about the big picture of financial management. It is concerned with explaining the differences in financial management between the public and private sector, how public bodies are funded, and the governance arrangements that tend to apply to public workers. It also explains the concept of value for money, something which is vitally important to organisations that do not sell their products and services in a free market.

I thought it might be interesting to write a series of blog posts over the next few weeks that show how the course was created. Step 1 has been sketching out the content in the form of a mind map.

I created the mind map in an application called Mindnode. One of its nice features is the ability to switch from a map view to an outline view. Another feature is the ability to export the mind map into OPML format, which can then be opened by an outliner app or in rich text format (RTF) to be opened in a word processor like Word or Pages. 

The next stage of the process is to expand the headings and notes in the mind map into a set of steps. Each of the main branches in the mind map will be a topic within the course. Each topic will be broken into a set of lessons that will take less than 10 minutes each to complete. The plan also has to set out how each lesson will be taught (whether the lesson will be text, video, slide presentation, etc) and what downloadable material is needed to support it.

If you are interested in the course then sign up to my list so that you don’t miss its launch. 

Tax avoidance doesn’t pay

I have worked on a freelance basis for over 13 years. For various reasons—to do with employment law and VAT mainly—I operate through a limited company. This means that I am actually an employee of a company, albeit a company which is 100% owned by me. This means that I operate a payroll system (I use the Xero online accounting system and I recommend it to anyone running a small business) which means that I get regular (at least one a week) emails from HMRC about payroll matters.

Earlier this week I received an email about ‘disguised remuneration loan charges’. I am not an expert in this but I believe some organisations with employees on high salaries use devices where they ‘lend’ money to the employee rather than pay their salary in order to avoid the tax, presumably for both the employer and the employee. Rangers Football Club lost a case at the Supreme Court in 2017 about the use of employee benefit trusts to channel payments to players and management in the form of loans.

None of that is relevant to me but I did notice the following paragraph in the email.

Tax avoidance doesn’t pay. Most arrangements simply don’t work and people can end up paying more than they were trying to avoid. Users may have a long-term requirement to deal with the cost, commercial and tax fallout from these transactions with no support from the promoter of the original arrangement.

I think perhaps this warning (the first four words, at least) should be prominently displayed on all HMRC communications and wherever wealthy people gather so that they recognise how risky the schemes they sign up with, for large fees, really are.

Free online training from the IMF about public financial management

The IMF (International Monetary Fund) have created an 8-weeks long course about public financial management. It is free, and available to you whether you work in a government agency, an NGO or are just interested in public money and budget transparency.

They have produced a 2-minute introductory video.

And you can sign up for the course here if you are a government official or work for a development agency and here if you are a member of the public. I think I will sign up because we can all learn something new however much of an expert we think we are.