The Politics of Public Money: Spenders, Guardians, Priority Setters, and Financial Watchdogs inside the Canadian Government

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Public money is one of the primary currencies of influence for politicians and public servants. It affects the standards by which they undertake the nation's business and it impacts on the standard of living of the nation's citizens. The Politics of Public Money examines the extent to which the Canadian federal budgetary process is shifting from one based on a bilateral relationship between departmental spenders and central guardians to one based on a more complex, multilateral relationship involving a variety of players.

In this innovative study, David A. Good examines this shift in terms of a broader societal change from an 'old village,' conditioned by old norms of behaviour, to a 'new town,' which brings with it new ideas about how public money should be managed and spent. Organized into four parts, the book opens with 'The Changing Politics of Public Money,' which sets out a revised and expanded framework for analysing the politics and management of public money. Part 2, 'The Public Money Players,' looks at the motivations, interdependence, and independence of the four budget players. The third part, 'The Public Money Processes," deals with the central functions of budgeting - determining fiscal aggregates, making budget allocations, and ensuring effective financial management. Finally, 'New Prospects for Public Money,' looks ahead to the future and considers ways to strengthen the interaction among the players, and in so doing, improve the politics and management of public money.

An insightful and incisive study of the changing budgetary process, The Politics of Public Money examines the promises and pitfalls of budgetary reform and sheds new light on the role insiders play in influencing government spending.

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Product Details

Meet the Author

David A. Good is a professor in the School of Public Administration at the University of Victoria.
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Table of Contents

Preface     xi
Introduction     3
The Changing Politics of Public Money
Beyond Spenders and Guardians     17
Spenders and Guardians     22
From Old Village to New Town     25
Beyond Spenders and Guardians     28
Priority Setters     32
Financial Watchdogs     34
Priority Setters and Financial Watchdogs     38
New Questions     39
The Public Money Players
The Guardians and the Changing Role of the Budget Office     43
Guardians and Budget Functions     45
Guardians and Budget Components     45
Guardians and the Budgetary Process     49
Different Guardians     56
Guardians Diverging: 'Let the Managers Manage...Come Hell or High Water'     60
Guardians and Central Reserves     63
Guardians Apart     68
Why Spenders Keep Spending     71
Getting Money     75
Keeping Money     81
Spending Money     83
The Reciprocity of Expenditure Information and Expenditure Increases     87
Priorities and Allocations, Not Performance and Allocations     89
The Priority Setters at the Centre     93
The Centre     95
The Most Important of All Relationships     97
Priorities, Big and Small     101
The Prime Minister's Arms     106
Priority Setters and Shift Points     115
The Financial Watchdog: A Bark with a Bite     118
Building Credibility on Professionalism and Independence     121
The Performance Audit: The Audit for All Reasons     128
Mutual Expectations     130
Watching Both Spenders and Guardians     132
The Watchdog and Internal Departmental Auditors     136
The Watchdog and Parliamentarians     137
Indirect Influence, but Influence     138
The Public Money Processes
Fiscal Aggregates: Controlling Totals     143
Credibility and Uncertainty     145
The Prudent Economic and Fiscal Outlook     152
The Prudent Fiscal Framework: Achieving Achievable Targets     155
The Elastic Fiscal Dividend     159
Prudence and Its Consequences     162
Containing Aggregates by Making Allocations     167
Budget Allocations     169
Allocations Types     171
The Big Fixes     174
The Big-Ticket Items     177
The Must Dos      180
Small Budget Items     181
Tax Expenditures     182
Reductions     185
Reallocations     189
Budget Allocations Are Incremental     194
Budget Implementation: Financial Management and Efficiency     197
On Paper     198
The First Line of Defence     202
Victims of Conflicting Norms: The Chief Financial Officer     207
The Second Line of Defence     211
Victims of the Intractability of Cultural Change: The Comptroller General     214
On Becoming Players     217
New Prospects for Public Money
Parliament and Public Money     223
Parliament as Watchdog     225
Shaping Government Spending: The Commons Finance Committee     227
Approving Government Spending: The Business of Supply     233
Holding Government Accountable for Spending: The Public Accounts Committee     242
Realism and Reform     244
Budget Reforms     247
Budgets and Reforms     248
'Rational' Reform: The Road to Program Budgeting (pre-1962-78)     251
The Grand Design: Policy and Expenditure Management System (1979-83)     255
Incremental and Continuous Change (1984-93)     261
Program Review and Prudent Budgeting (1994-2003)     266
'A Continuous Culture of Reallocation' (2004-6)     272
Strengthening the Watchdogs: The Federal Accountability Act (2006 and onward)     275
Reflections on Reforms     282
Doing Better with Public Money?     285
Theory and Practice     286
Reactive, but with Some Resilience     295
The Uneasy Balance of Competing Budgetary Objectives     298
Establishing an Expenditure Review Committee of Cabinet     302
Restoring a Treasury Board Secretariat Role in Expenditure Review and Allocation     304
Linking Priorities, Expenditure Programs, and Performance     306
The Politics of Public Money     309
Notes     311
Index     359
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