Another alarming report on the use of public funds in NI

Morning View
Morning View

It is easy when discussing public money in Northern Ireland to be blinded by the scale of taxpayer funds that course through the economy every day.

The fiscal deficit alone in the Province is almost £30 million a day.

There are inevitably significant amounts of inefficiency and waste, as there is in governments in all countries and as there is with Treasury funds in regions across the UK.

When we read that millions of pounds have been squandered on this scheme or that might not be so surprising in the overall context of the vast amounts of government money that is being spent on a wide range of things, often successfully.

Even so, not infrequently in Northern Ireland there have been Audit Office reports that make alarming reading.

The latest report from that oversight body has explained how taxpayers are likely to recoup about £73 million from £101 million in a Stormont loan fund that gave incentives to those contracted to invest the money in a set time frame.

The fund, overseen by Invest NI, was intended to support promising small and medium sized companies after the financial crisis, when credit was hard to come by.

Bonus or target structures in many walks of life often produce unintended consequences.

In this instance, the Audit Office noted that fee structures provided little incentive for fund managers to deliver strong outcomes, and instead focused on number or value of investments. It is not hard to see how such a set up could lead to hair raising costs.

The credit crunch rocked global markets and led to immense government waste as administrations tried to prop up their economies.

Difficulties caused by financial confusion and sometimes mediocre administrators are not unique to Northern Ireland.

But these Audit Office reports play a vital role in uncovering and recording fiscal losses, and, it is to be hoped, improving the skills of those who control public money.