Accountability and Value for Money in Private Finance Initiative Contracts

Within the context of New Public Management (NPM), successive UK governments have claimed that PFI projects provide more accountability, and arguably, more value for money (VFM) than conventional procurement for the public (HM Treasury 1995, 2000, 2003a and 2003b). However, recent empirical research in the UK on PFI has indicated its potential limitations for accountability and VFM (Broadbent, Gill and Laughlin, 2004; Edwards, Shaoul, Stafford and Arblaster, 2004; Shaoul, 2005; and Ismail and Pendlebury, 2006) albeit these are based on either published accounts or a limited number of key stakeholders. This paper attempts to partially redress this gap in the literature by presenting an interesting case of the impact of PFI on accountability and VFM in Northern Ireland's education sector. The findings of this research, based on forty two interviews with a wide range of key stakeholders, suggest that stakeholders have different and often conflicting expectations and the actual PFI accountability and VFM benefits are much more obfuscated than those claimed in Government publications.

The Diffusion of Risks in Public Private Partnership Contracts

Purpose The UK government argues that the benefits of public private partnership (PPP) in delivering public infrastructure stem from: transferring risks to the private sector within a structure in which financiers put their own capital at risk; and, the performance based payment mechanism, reinforced by the due diligence requirements imposed by the lenders financing the projects (HM Treasury, 2010). Prior studies of risk in PPPs have investigated ‘what’ risks are allocated and to ‘whom’, that is to the public or the private sector. The purpose of this study is to examine ‘how’ and ‘why’ PPP risks are diffused by their financiers. Design/methodology/approach This study focuses on the financial structure of PPPs and on their financiers. Empirical evidence comes from interviews conducted with equity and debt financiers. Findings The findings show that the financial structure of the deals generates risk aversion in both debt and equity financiers and that the need to attract affordable finance leads to risk diffusion through a network of companies using various means that include contractual mitigation through insurance, performance support guarantees, interest rate swaps and inflation hedges. Because of the complexity this process generates, both procurers and suppliers need expensive expert advice. The risk aversion and diffusion and the consequent need for advice add cost to the projects impacting on the government’s economic argument for risk transfer. Limitations and implications The empirical work covers the private finance initiative (PFI) type of PPP arrangements and therefore the risk diffusion mechanisms may not be generalisable to other forms of PPP, especially those that do not involve the use of high leverage or private finance. Moreover, the scope of this research is limited to exploring the diffusion of risk in the private sector. Further research is needed on how risk is diffused in other settings and on the value for money implication of risk diffusion in PPP contracts. Originality/value The expectation inherent in PPP is that the private sector will better manage those risks allocated to it and because private capital is at risk, financiers will perform due diligence with the ultimate outcome that only viable projects will proceed. This paper presents empirical evidence that raises questions about these expectations. Key words: public private partnership, risk management, diffusion, private finance initiative, financiers

Irresponsible Lending?: A Case Study of a U.K. Credit Industry Reform Initiative

There are major concerns about the level of personal borrowing, particularly sourced from credit cards. This paper charts the progress of an initiative to create a Responsible Lending Index (RLI) for the credit industry. The RLI proposed to voluntarily benchmark lending standards and promote best practice within the credit industry by involving suppliers of credit, customer representatives and regulators. However, despite initial support from some banks, consumer bodies and the Chair of the Treasury Select Committee, it failed to gain sufficient support from financial institutions in its original format. The primary reasons for this were related to the complexity of building such a robust index and the banks trade body’s fear of exposing its members to public scrutiny. A revised alternative, the Responsible Lending Initiative, was proposed which took into account these concerns. However, the Association of Payment Clearing Service (APACS), the trade body of the credit industry, then effectively destroyed the proposal. This article describes an attempt to address the challenges in the credit card industry with the initiation of the RLI, reflected in stakeholder discourse and in the context of a wider concern expressed by the involved stakeholders in terms of the need for greater responsibility in the banking industry’s lending practices.

Energy: lessons from devolution

Geraint Ellis and Richard Cowell explain the findings of the ‘Delivering renewable energy under devolution’ project, including some reasons for Scotland’s lead.

The UK has seen massive increases in renewable energy since 1998, with installed capacity growing from 2,600 MW to 12,300 MW in 2011. This has coincided with devolution and it is within Northern Ireland, Scotland and Wales that the greatest increases have been seen.

As devolved administrations now host half of the UK’s renewable energy capacity, their policies are critical to achieving the broader UK targets. This also provides a fascinating insight into what sort of approach works best, and why. This has been the focus of a two-year study, funded by the Economic and Social Research Council, involving universities from across the UK, which indicates that Scotland is leading the way on renewable energy.

All devolved governments have offered significant support to renewable energy but have different degrees of powers in relation to energy. Scotland’s success seems to be based on the centrality of energy issues to current political aspirations, particularly the SNP, but also has cross-party support. The research suggests that the consensus on the importance of renewable energy amongst élite interests in Scotland helps to explain why Scottish governments have been empowered and enabled to make robust use of the powers available.

As it has achieved successful growth in the sector, this too helps cultivate credibility among key business interests and gives increased leverage to its position in policy discussions with the UK Government. Scotland has been more consistent over time in presenting the expansion of renewable energy as a national economic agenda, rather than just an environmental or rural development agenda. The availability of larger, windy, but relatively less contested sites for onshore wind in Scotland has meant that more projects went through central consenting procedures rather than local planning authorities. Its enhanced support for wave and tidal power technologies is also notable. These political conditions have been harder to find in the rest of the UK, making progress a little more uncertain.

Northern Ireland has used its powers (which are more extensive than Scotland’s) to facilitate small-scale renewables and bio-fuel processes, with its liberalised planning regime offering an initial boost to expanding capacity.

This has contrasted with the position in Wales, which has least control over energy but the Welsh Government has adopted a more innovative approach to strategic spatial zoning; this appears to have pulled in a larger volume of onshore wind development interest than could be expected in a comparable region of England. A downside of the Welsh approach appears to be the fact that the concentration of these wind projects in these zones has triggered public opposition and political conflict.

It therefore appears that the powers available to the devolved governments do not seem to determine which country has been able to make greatest headway, with broader political commitments being more significant. Despite this, the research does not conclude that the actions and activities undertaken by the devolved governments are necessarily the most important factors in shaping the development of renewable energy in the UK. This is because devolution is still a relatively new dimension of energy governance in the UK and decisions affecting key drivers for renewable energy investment are still made mainly in Westminster, with the Treasury exercising close budgetary control. In all areas of the UK, grid capacity expansion remains slow to achieve. The major growth in offshore wind to date has been driven mainly by Westminster and cross-UK bodies with the most significant capacity growth being in English territorial waters.

The letters of Lowndes, addressed to the Hon. John C. Calhoun

This document contains an address to John C. Calhoun about various points that they disagree on and why.

Departmental Select Committees

The idea of departmental select committees in the House of Commons was floated as long ago as the Haldane Report in 1918 and periodically mooted by figures from both left and right as varied as Amery and Laski in the inter‐war years. It was raised again during the wartime investigations of the Machinery of Government committee, only to be shot down by the then Cabinet Secretary, Sir Edward Bridges, on the grounds that it would constrain the frankness with which the Civil Service could advise ministers. Departmental select committees were not to be introduced until 1979. Ten years ago the Institute of Contemporary British History organised a symposium to review their progress. On 31 January 1996 in committee room 10 at the House of Commons the ICBH, in conjunction with the Hansard Society, held another seminar to re‐examine the development of the departmental select committee system, its successes and failings. It was chaired by George Cunningham (Labour MP 1970–82, SDP MP 1982–83). The principal participants were Sir Peter Kemp (Deputy Secretary, Treasury 1983–88, Next Steps Project Manager, Cabinet Office, 1988–92), Douglas Millar (Clerk of Select Committees, House of Commons since 1994), Dr Ann Robinson (author of Parliament and Public Spending, head of the policy unit at the Institute of Directors [IOD], 1989–95 and Director‐General of the National Association of Pension Funds Ltd since 1995), Robert Sheldon (Labour MP since 1964, Financial Secretary to the Treasury 1974–75, member of the Public Accounts Committee [PAC] 1965–70 and 1975–79 and chairman since 1983, member, Public Expenditure Committee 1972–74, and member of the Treasury and Civil Service Committee [TCSC] 1979–81) and Sandy Walkington (head of corporate affairs at BT [British Telecom] plc), with further contributions from Peter Riddell (assistant editor: politics, The Times, since 1993), Chloe Miller, Sean McDougall, Tim King and Chris Stevens.

PEC e a vertente empresarial: impacto na gestão de tesouraria das PME

Dissertação de Mestrado apresentada ao Instituto de Contabilidade e Administração do Porto para a obtenção do grau de Mestre em Contabilidade e Finanças, sob orientação de Cláudia Maria Pereira Esta versão contém as críticas e sugestões dos elementos do júri.

A utilidade da demonstração de fluxos de caixa na ótica dos Técnicos Oficiais de contas

O tema Fluxos de Caixa tem cada vez mais importância nas empresas e no relato financeiro das mesmas. Com a entrada em vigor do Sistema de Normalização Contabilística em 2010, tornou-se obrigatória a apresentação da Demonstração de Fluxos de Caixa nas Demonstrações Financeiras das empresas que adotem o regime geral. Segundo a Norma Contabilística e de Relato Financeiro 2 – Demonstração de Fluxos de Caixa, nos seus parágrafos 7 e 8, a Demonstração de Fluxos de Caixa “deve relatar os fluxos de caixa durante o período classificados por atividades operacionais, de investimento e de financiamento. A classificação por atividades proporciona informação que permite aos utentes determinar o impacto dessas atividades na posição financeira da entidade e nas quantias de caixa e seus equivalentes”. Possibilita a avaliação das empresas, a deteção de sinais de fragilidade e ajuda a decidir qual o melhor caminho a seguir. O objetivo central deste trabalho consiste em evidenciar a importância e utilidade da Demonstração de Fluxos de Caixa para os profissionais de contabilidade e para os utilizadores da informação financeira, na ótica dos Técnicos Oficiais de Contas, e será alcançado através de um questionário a este grupo de profissionais. Os resultados obtidos permitiram-nos aferir que os Técnicos Oficiais de Contas consideram esta Demonstração Financeira importante e atribuem-lhe a utilidade que efetivamente representa, isto é, consideram-na uma peça indispensável para a gestão de tesouraria como para a gestão operacional, financeira ou de investimentos de qualquer empresa. Contudo, na sua opinião, esta Demonstração é ainda pouco valorizada pelos utilizadores da informação financeira.

A gestão de tesouraria nas instituições de Ensino Superior

No atual contexto económico e financeiro, a gestão de tesouraria assume uma importância relevante dentro das organizações. Efetivamente, o dinheiro é a preocupação de qualquer gestor. A obtenção deste recurso escasso, com o mínimo custo e geri-lo de forma a otimizá-lo, é sem dúvida, o objetivo de qualquer gestor financeiro, no contexto de incerteza em que nos movemos. A atual crise proporciona à tesouraria a oportunidade ideal de realçar a sua importância estratégica e o valor acrescentado que pode trazer às organizações. Todas as áreas da organização, direta ou indiretamente, mantêm ligações com a área de tesouraria. O objetivo deste trabalho é enfatizar a relevância da gestão de tesouraria nos processos financeiros, antecipando informações para análise e tomada de decisão dos responsáveis financeiros nas Instituições de Ensino Superior; é demonstrar que a gestão de tesouraria deve fazer parte da cultura da organização e que é uma ferramenta de apoio para o planeamento financeiro, da gestão estratégica, de investimentos e de aproveitamento de oportunidades de crescimento das Instituições de Ensino Superior. Por último, pretendeu-se identificar e sugerir boas práticas e melhorias nos processos existentes, nas Instituições de Ensino Superior, que possam contribuir para a eficiência e eficácia da gestão de tesouraria. A revisão da literatura conduziu-nos à análise das diversas perspetivas da gestão de tesouraria, a importância das boas práticas, do sistema de controlo interno e da auditoria. Mostrou-se pertinente compreender o contexto jurídico das IES. Foi relevante a abordagem dos ciclos financeiros das organizações, para compreender a importância da realização de orçamentos de tesouraria, como um instrumento do controlo dos fluxos financeiros e da tomada de decisões dentro das organizações. Realizou-se ainda uma abordagem à gestão de crédito, às fontes de financiamento e à temática da centralização da gestão de tesouraria nas IES, por se entender que são aspetos fundamentais que contribuem para a eficiência e a eficácia desta área de atuação das instituições. Decorrente da revisão da literatura, identificaram-se as perguntas de investigação e aplicou-se a metodologia de um estudo de caso único de uma instituição de ensino superior, através da elaboração de entrevistas, recolha dos dados, pesquisa documental, observação direta e participativa do investigador. As conclusões finais do nosso estudo revelaram que o modelo de análise aplicado ao IPP, teve uma taxa de confirmação de 53%. As componentes do modelo em análise com os resultados mais significativos e que mais contribuíram para esta confirmação, foram a gestão de tesouraria considerada como um patamar estratégico nesta IES, a elaboração do orçamento de tesouraria e os procedimentos associados ao sistema de controlo interno.

Cessão de créditos - uma opção de financiamento

Dissertação de Mestrado em Solicitaria

Anatomy of the portuguese stock market risk and return in the 1977-2012 period

This paper analyses the Portuguese stock market since it reopened in 1977, with a special focus on the evolution of the statistic and stochastic characteristics of the market return throughout this 36 year period. The market return for the period of time between 1977 and 2012 (September 28th) is estimated and then compared with the return that would have been achieved with Government bonds and treasury bills, which allows us to confirm that the hierarchy of return / risk across the different financial instruments is verified. The market risk premium for this 36 year period is also estimated and a comparison with other markets is performed, suggesting that the Portuguese market’s risk has not been compensated by an adequate return. The study also examines the evolution of the Portuguese market’s volatility in the 1977-2012 period and compares it with other markets, showing the existence of extremely high peaks during the first 11 years, but indicating a downwards trend throughout the whole period under analysis. Finally, the correlation between market returns for Portugal and for other countries and the degree of integration are estimated and their evolution throughout time is assessed, leading to the conclusion that the performance of the Portuguese stock market has become increasingly correlated with major European markets – correlation with some markets close to 0.70 from 2000 onwards-, but that country-specific risk factors are still relevant.

Letter from George W. Campbell the Chairman of the Committee appointed to inquire into the causes and particulars of the invasion of the City of Washington

Full Title: Letter from George W. Campbell, esq., late Secretary of the Treasury, to the Chairman of the Committee appointed to inquire into the causes and particulars of the invasion of the City of Washington, and the neighboring town of Alexandria, in the month of August last Laid before the House by the Chairman of the said Committee, and ordered to be printed January 2, 1815. 13th Congress, 3rd Session. House. Doc. 38. Printed by Roger C. Weightman

Letter to Mr. Henry H. Collier, 1837

Henry Haight Collier, was born in Howard, Steuben County, N. Y., November 28, 1818. His father, Richard Collier, was from Green County, in the same State. His grandfather, Isaac Collier, and his great-grandfather were originally from England. His mother, Mary Haight, was of Dutch origin. In 1835, Henry went to St. Catharines, where his elder brother, Richard Collier, resided. He spent two years at Grantham Academy, and then returned to Steuben County, to read law in Bath, with Edward Howell, and subsequently with Hammond and Campbell. Mr. Collier never opened a law office. He studied law for two years and in 1839 he went to Texas where he was connected with the State and Treasury Departments. In 1845 Mr. Collier returned to St. Catharines and opened a general store called St. Catharines Agricultural Works with his brother. The store remained open until May, 1877. He added the manufacturing of lumber in 1850, and manufacturing of agricultural implements in 1869. He built one of the first saw mills on the canal, on Lock No. 5, in St. Catharines. In July, 1877, he was appointed Collector of Customs. He became a Village Councilor for St. Paul’s Ward in 1859, and held that office from fifteen to twenty years. He was Deputy Reeve and member of the County Council for two terms. He was the Mayor of St. Catharines in 1872 and 1873. He was also Chairman of the Board of Water Commissioners of the city, during the time that the works were being built. He was a Justice of the Peace for twenty years or more. Mr. Collier was affiliated with the Reform Party and he was a Knight Templar in the Masonic fraternity and an Odd Fellow. He was also active in the Methodist Church. On June 1, 1858, he married Cornelia, daughter of Moses Cook, of "Westchester Place," St. Catharines, and had a daughter and son. Mary J. (married name: Mrs. Frank Camp) was a graduate of the Female Seminary at Hamilton, and Henry Herbert was a student in the University of Toronto. Henry H. Collier died on July 15, 1895 and is buried in Victoria Lawn Cemetery, St. Catharines, Ontario. Sources: www.accessgeneology.com "Historical Profiles from Victoria Lawn Cemetery" by Paul E. Lewis "Sincerely Lamented St. Catharines Obituaries 1817-1918" by Paul Hutchison

Letter from Thomas Tudor Tucker, treasurer of the United States: transmitting his accounts for 1816, February 25, 1817

Bound with: Letter from the Secretary of the Treasury transmitting statements of the importations of goods, wares and merchandise... (60 p.).

Semi-Parametric Weak Instrument Regressions with an Application to the Risk-Return Trade-off

Recent work shows that a low correlation between the instruments and the included variables leads to serious inference problems. We extend the local-to-zero analysis of models with weak instruments to models with estimated instruments and regressors and with higher-order dependence between instruments and disturbances. This makes this framework applicable to linear models with expectation variables that are estimated non-parametrically. Two examples of such models are the risk-return trade-off in finance and the impact of inflation uncertainty on real economic activity. Results show that inference based on Lagrange Multiplier (LM) tests is more robust to weak instruments than Wald-based inference. Using LM confidence intervals leads us to conclude that no statistically significant risk premium is present in returns on the S&P 500 index, excess holding yields between 6-month and 3-month Treasury bills, or in yen-dollar spot returns.