As the fiscal year draws to a close we’re seeing roadworks popping up all over the country as LGAs (Local Government Agencies) desperately try to spend their surplus budgets.
The reason why they do this is because if they don’t spend it, the government will cut their budget for the following year.
This doesn’t just occur within town councils, but other government funded organisations too, such as the NHS.
A while back I worked in the Social Marketing sector. (Not to be confused with Social Media.) Social marketing clients tend to be LGAs and PCTs, (Primary Care Trusts), which run hospitals and health services.
Campaigns they might undertake include: Smoking cessation; healthy eating; chlamydia screening; teenage pregnancy; alcohol & drug misuse; contraception; STDs; etc.
I enjoyed plying my trade as an Adman, for what I felt were, worthy causes.
Where it all started turning sour for me, was when, at this time of year, one particular SM Agency embarked on what they call an ‘Underspend’ campaign. Whereby they target PCTs surplus budgets.
The PCTs operate in the same way as the LGAs, in that, if they haven’t spent their budgets they will have it reduced for the following year.
So the PCTs frantically try to find ways to spend their surplus. So what this Social Marketing agency did was invoice the PCT before the end of the tax year for work that they hadn’t yet undertaken. But would undertake the following financial year. (Still with me?)
What’s wrong with that? I hear you ask. Particularly if the work will be undertaken at some stage.
The problem I have is two-fold.
Firstly, rather than spend the money on an ill-conceived social marketing campaign to jettison the budget, why not spend it on something else, like a life-saving piece of equipment? Or employ another couple of nurses?
Well, because that’s a different department’s budget. And what we don’t want is another dept getting their grubby little MRSA contaminated fingers on our budget.
Secondly, some of this stockpiled money that the SM agencies are holding for work they will carry out at some stage, gets, let’s say, ‘forgotten about’ by the PCT.
But the SM agency hasn’t forgotten about it. Nor have they offered to return the money to the PCT. Perhaps it was an oversight.
Don’t get me wrong. I think Social Marketing is an important aspect of improving the health and well-being of our citizens. I also believe their are many SM agencies who are doing very noble and ethical work.
But, as in most industries, there are some companies who are just in it for the dosh. It’s just another ‘revenue stream’ to be tapped into. Or milked.
What galls me, is while the SM agency sits self-righteously on its moral steed, it’s also raping the the NHS for all its worth.
What seemed like a noble endeavour to me, turned out to be more rapacious than people’s perception of the one I had left. Namely, advertising.
So, what can we do about it?
Well, we could stop punishing LGAs and PCTs for being good at budgeting, for starters.
We could allow one dept to transfer money over to another without penalising them the following year.
We could allow them a period of grace. Say, three years. If they consistently underspend, then their budget will be reduced.
And, most importantly, we need proper accounting in PCTs to make sure work paid for in one financial year, actually takes place the following year.
Maybe this practice is widespread. And that’s why I’m a terrible businessman.
Anyway, that’s my tuppence worth.