Re-inventing budgeting: the impact of third way modernisation on local government budgeting

Re-inventing budgeting: the impact of third way
modernisation on local government budgeting
Research Executive Summaries Series
Vol. 2, No. 10
By
Will Seal
and
Amanda Ball
1. Overview
The focus of this project was on post-1997 policy innovations for the local government sector and
their impact on traditional budgeting practices.
By studying the budgetary practices of two large but very contrasting English local authorities, the
project was able to evaluate the ways in which each organisation responded to different challenges
and circumstances.
The main ndings
• Both case study authorities abolished departmental structures and adopted small ‘cabinets’ with
senior members holding portfolios that reect a cross-cutting perspective. Budget scrutiny was
greatly streamlined.
• Both authorities developed long and medium term plans intended to indicate the councils’
priorities and guide long-term nancial strategies.
• Both authorities developed new reporting systems that not only picked up the traditional
budgetary variances but also monitored non-nancial performance.
• Services (and their budgets) were subject to periodic fundamental reviews either as a result of
the best value performance framework or as part of base budget review processes developed by
the authorities themselves.
• Social services were pioneering cross-cutting initiatives with education and health that were
beginning to inuence traditional budgetary practices.
• At the time of the research, modernisation seems to be associated with outsourcing rather than
on a rational appraisal of make or buy which might suggest bringing some services back in-house.
• In a period when council taxes had generally risen steeply, central government should have been
less quick to scapegoat local government for problems caused by national policies. On its part,

local government should have tried to improve its public image in the many areas where it had
re-invented itself.
2. Objectives
The overall aim of the project was to undertake an empirical examination of budgetary practice
in two large local authorities in England. These authorities were located in quite different regions
of the country and face different economic, social and political pressures. One authority in the
north of England had a declining traditional manufacturing base, high levels of unemployment and
a relatively large proportion of population originating from the Indian sub-continent. The other
authority was located in the south of England near to London and faced different challenges based
around issues of congestion and labour shortages in the public services.
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
1 | Research Executive Summaries Series
1. Overview
The main ndings
2. Objectives
3. Findings
3.1 Introduction
3.2 Local government reform since 1997
3.3 The experience of ‘Eastmet’
3.4 The experience of Southshire
4. Conclusions
Authors contact details
References
Contents
The project had ve main objectives:
1. To ascertain the forms of budgeting employed
by the authorities prior to the reforms
introduced by the government after the 1997
election.

2. To trace the effects of changes in political
and management systems such as Best Value
performance frameworks and cabinet
structures on the practice of budgeting.
3. To assess the impact of public/private
partnerships on the practice of budgeting.
4. To examine the impact of cross-service
programmes on budgeting practice.
5. To compare the two authorities and examine
the emergence of innovations in council
budgeting.
3. Findings
3.1 Introduction
With local expenditure 25% of total public
expenditure and 10% of national income, UK local
government is an economically important sector.
It is also a major player in the delivery of public
services, having responsibilities in areas such as
education, social services, and environmental
well-being. Yet local government is not just
about service delivery as local authorities are
democratically elected bodies and, as such, have
an explicitly political dimension.
The Conservative approach to reform in the period
1979-1997 tended to down play the political
role of local government with an emphasis on
changing the approach to service delivery through
policies such as compulsory competitive tendering
(CCT) and centrally imposed ‘caps’ on local
expenditure. With the New Labour government

(inuenced by the concepts of the third way), the
emphasis seemed to be much more on reforming
local government rather than constraining it.
Yet although New Labour has abolished the
much disliked CCT and the capping of local
government expenditure, it has still retained
reserve powers to control local expenditure and
required local authorities to deliver services
based on the new principles of Best Value and
Comprehensive Performance Assessment (CPA).
Much of its modernisation policies have aimed to
achieve integration, cross-cutting and joined-up
government (DETR, 1998).
Many recent proposals for local government
modernization in the UK seemed to have been
informed by a widely held view that past efforts
at reform have failed. Budgeting, in particular, was
dominated by the practice of incrementalism. If
global budget cuts or increases were required then
there has been a tendency to decide on across-
the-board percentage decreases/increases with
little attempt to develop a system of priorities.
The various policies described through the
umbrella term of the ‘New Public Management’
(NPM) between 1979-1997, did result in some
changes in service delivery through innovations
such as compulsory contractualisation, but
they did not change long established budgetary
practices at corporate level. With New Labour,
modernisation initiatives were not always

targeted at budgeting issues, but did attack the
departmentalist mindset. A central question for
this study, therefore, was to ascertain how far
it was possible to reform or improve budgeting
against a background of wider attempts to change
traditional administrative cultures.
3.2 Local government reform since 1997
With the advent of Tony Blair’s rst administration
in 1997, the key plank of local government reform
was Best Value. Under the Local Government Act
(1999), councils had a duty ‘to deliver services
to clear standards - covering both cost and
quality - by the most effective, economic and
efcient means available for local people’. Local
authorities would set standards for those services
for which they were responsible while for certain
services, such as education and social services, the
government would set national standards.
Best Value required the establishment of a
performance management framework. The
framework was to be composed of a performance
plan, an agreed programme of performance
reviews, the setting of targets for improved
performance, an independent audit of the service
reviews and performance targets. Best Value was
accompanied by a system of audit and inspection
in order to check on information and management
systems. The Best Value regime also had a
mechanism for intervention in the case of a failing
local authority.

Although CCT had been abolished, the mandatory
imposition of contractual governance via outside
providers could still take place. Council services
that are deemed to have failed by inspectors
may be taken away from direct local authority
provision via some form of public/private
partnership. The implications for budgeting in this
instance are quite radical.
Post-1997, local government modernisation was
also associated with increased local engagement.
Local people could be consulted as individual
consumers of council services or through
neighbourhood and community based forums.
Alongside these changes, local authorities began
to establish new political and management
structures that saw the abolition of the old
departmental structure and replaced it with
services areas being run as directorates.
The directorates were often placed in one
organisational unit under a Chief Executive
of Operations. Other measures designed to
strengthen the corporate core included the
establishment of local government cabinets and
directly elected mayors.
Research Executive Summaries Series | 2
Back to Contents
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Back to Contents
3.3 The experience of ‘Eastmet’

The City of Eastmet Metropolitan District Council (an assumed name) is a large council in the north
of England, serving a diverse and multi-cultural population of some 500,000 people, and managing
an annual revenue budget in excess of £500m. The area has an ethnically diverse population with
almost 20% of the population of Pakistani, Bangladeshi or Indian origin, while about 3% are of Afro-
Caribbean or other non-white origin. Unemployment rates are relatively high at nearly 2% above the
national average. The average wage is lower than the national average and 44% of children live in
low-income households, compared to 27% nationally.
Eastmet’s response to the government’s modernisation programme varied in its application. In some
areas it was a leader. For example, it was chosen to pilot a specic project in the early days of Best
Value. However, the authority was relatively late in establishing new political structures.
In common with many local authorities, Eastmet eventually introduced a cabinet-style of executive.
The main feature of the cabinet model was that the old committees based around services such
as education, social services, and so on, were replaced by a small group of senior members each
of whom hold a portfolio of responsibilities. The bulk of the members (who all formerly sat on the
service committees) became ‘backbenchers’ sitting on newly formed scrutiny committees. The aim
of the reform was to strengthen the corporate core of the authority, encourage cross-cutting and
enable a more strategic perspective for councils. Management structures and processes were also
re-aligned to support the new political structures.
Eastmet was a pioneer of Best Value with several of its senior ofcials helping to develop the policy
after the 1997 election. At rst, Best Value was not really integrated in to the budgeting system. For
example, ofcers involved in implementing Best Value argued in the summer of 1999 that Best Value
had not yet started to feed through to service deliverers and thus through to budgets.
The lack of linkage with budgeting did not stop the authority developing its performance indicators,
a Performance management framework (by December 1999) and publish its rst annual Best Value
Performance Plan (BVPP) in 2000 (as required by local government Act 1999). Gradually Best Value
began to develop its own routines with frequent (monthly) monitoring of performance. Elected
members and top management began to receive regular reports of performance against targets.
The impact of Best Value on budgeting gradually increased as the new reporting systems and
performance indicators bedded down. With spreadsheets of Performance Indicators (PIs) being
submitted to the Chief Executive on an exception basis, a new system was being developed with

monthly reports being fed into an emerging structure of executive and scrutiny committees.
Although the newly created directorates still had their own budgets, there was now an expectation
that resources would be moved around as guided by the performance-planning framework.
Although the council were pioneers in developing cross-service programmes, the study found little
evidence for pooled budgets. There were, however, a number of cross-cutting projects that could
have attracted special funding such as the Neighbourhood Renewal Fund.
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
3 | Research Executive Summaries Series
As a way of improving an initial lack of linkage
between Best Value and budgeting, the authority
responded with a new nancial strategy based
on a long-term (20 year) vision of the authority
and the area, and a consultation process with
elected members, neighbourhood panels and
speak out forums. This long term and strategic
thinking led to ‘priority-led budgeting’. Both the
corporate centre and service managers took a
three-year budget view and the criteria for moving
resources around were now more clearly linked
to local consultation processes. Although shifting
political fortunes meant that short-term political
expediency might conict with the longer term
plans, the key change was that budgets could
now more readily respond to priorities rather than
simply roll over.
3.4 The experience of Southshire
Southshire (again, an assumed name) is generally
very afuent, with a population of around 1
million and is located in the South of England.

Although Southshire is the most urbanised shire
county in England, 85% of its area is countryside.
Ethnic communities comprise less than 3% of
the population. Southshire has with virtually no
unemployment contributing to signicant labour
and skills shortages in many areas. In all sectors
there are shortages of labour in technical and
support service areas. The annual revenue budget
was about £900 million.
Southshire had been characterised by
departmentalism (with departments described by
one Executive Member as ‘huge silos (operating)…
to the detriment of the customer’), with a
centralised approach to budgeting, supported
by departmental nance functions which were
established in the early 1990s. Members had
traditionally relied on ofcer judgement to set
out basic budget parameters and to put forward
suggestions for Council Tax rises. The process
has been incrementalist, with the Director of
Finance providing a rolled-over budget comprising
headline gures. Budget making had traditionally
been carried out outside the corporate planning
process, and was recognised as falling short of
expectations. At the same time, the Council’s
nancial and information systems were generally
perceived as failing to provide disaggregated
service information as a basis for better budget-
making linked to corporate priorities.
As in Eastmet, internal pressures to reform the

budget process were building at Southshire in
the run up to the post-1997 modernisation
programme, and have worked in tandem with the
modernization process ever since. In 1997 the
Council instigated its own series of fundamental
reviews (which pre-date Best Value, in spite of the
overlapping terminology) carried out by around 40
task groups. The aim was to look for fundamental
change in how services were provided and the
resources committed to them. The fundamental
reviews led to re-focussing and achieved a
reduction in total spending of around 4-5% of the
total Council revenue budget.
The Best Value review process at Southshire
(which arguably simply extended the Council’s
own ‘fundamental review’ programme) was
mobilised in support of arguments for improving
the customer focus of the traditional service
departments and for improving awareness of the
consequences of resource shortages. Ofcials
and members frequently claimed that much
of the modernisation programme was simply a
codication of some good practices, which they, in
Southshire, had already adopted.
More recently, Southshire had implemented a
major corporate change programme, ‘People First’,
to develop stronger links between nance and
performance in recognition that the corporate
planning process had been decoupled from the
budget-making process. People First aimed

to deliver enhanced budgetary performance
reporting, leading to a focus on service outcome
targets alongside traditional measures of
accounting budget against expenditure. More
fundamentally, People First was underpinned by
signicant restructuring of the old Southshire
Departments. Schools support services became
a unied service that operated on the basis of
functionally mixed teams within different areas of
Southshire. Traditional boundaries between the
two major service blocs (and traditional political
power bases), Education and Social Services were
eroded. The old ‘Special Educational Needs’ section
was married more closely with Social Services to
create a unied Children’s Service. The eventual
outcome (around 2004) was merged budgets.
Alongside this, Southshire Council introduced
a new political structure that delegated the
management of its business to a single party
Executive of ten Members, each with responsibility
for a specic area of work or ‘portfolio’. Budget
scrutiny became the responsibility of a very small
number of Executive portfolio holders.
Southshire also made signicant investments in
its budgetary and performance system. Further
signicant investment in an ERP (Enterprise
Resource Planning) system provided information
at service level which had been previously
unavailable.
Back to Contents

Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Research Executive Summaries Series | 4
Back to Contents
4. Conclusion
Although both the case authorities were subject to the same regulatory regimes, the geographical,
economic, demographic and structural differences between them meant that they faced different
challenges and circumstances and responded in different ways.
First, although national government has raised aggregate levels of funding to local government, the
distribution of the increases has varied with a general favouring of the metropolitan authorities in
the north and midlands over the southern shire counties. Second, national government also raised
its expectations for performance from local authorities so that although resources were increased,
demands were also increased.
In addition, the Audit Commission (2003) noted a number of external pressures on councils that
push up spending:
• Public expectations that services will improve.
• Pressure from central government to spend more to meet government priorities.
• The role of inspectorates and other regulators in requiring councils to meet more demanding
standards.
The most important driver of diversity was the immense difference in the economic circumstances
between Eastmet and Southshire. Whilst Eastmet faced challenges of de-industrialisation,
unemployment and general economic decline, Southshire’s problems were outcomes of afuence
with issues of congestion and labour shortages.
There were, however, a number of commonalities between the authorities in the way that budgeting
practices were developing:
1. New political and management structures - the old management structures were almost
inevitably incrementalist with big departments that were in alliance with specialised committees.
Both case study authorities have abolished departmental structures and have adopted small
‘cabinets’ with senior members holding portfolios that reect a cross-cutting perspective. In
Southshire, for example, there is a single organisational structure and budgets for children’s

services replacing the old education and social service departments.
2. An increased use of policy-led budgeting - both authorities had developed long and medium
term plans that were intended to indicate the councils’ priorities and guide long-term nancial
strategies. In Eastmet, nance ofcers aided the different political groupings to formulate
their own budgets. The overall aim in both authorities was to embed corporate priorities into the
budgetary process.
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
5 | Research Executive Summaries Series
Research Executive Summaries Series | 6
3. An increased use of non-nancial performance
indicators in conjunction with nancial
measures - both authorities had developed
new reporting systems that not only picked
up the traditional budgetary variances but
also monitored non-nancial performance.
Both authorities had also developed three year
nancial strategies with special mechanisms to
allow investment in services and promote
changes in service provision.
4. Services (and their budget) were subject to
periodic fundamental reviews - incrementalism
is associated with a tendency to just roll
over existing budgets without asking whether
the underlying activities that are being
nanced are still necessary or the most
effective way of providing local government
services.
Best Value has institutionalised a programme of
periodic reviews. Southshire had a member-led

approach to fundamental review that had actually
anticipated the Best Value philosophy. In Eastmet,
nance managers were introducing a system of
Base budget review, which followed the principle
of reviewing service budgets to see whether it was
possible to take lines out.
In addition to these ndings, the report makes
a number of recommendations for improved
budgetary performance:
• There is a need for more participation in
budgeting and especially a more credible
system for schools to get involved in the
budget setting process.
• If the schools’ budgeting system is to remain
centralised or become even more centralised
then policy makers need to have a better
knowledge of educational cost drivers
1
.
• There needs to be a more even handed
approach to outsourcing. At present,
modernisation seems to be associated with
outsourcing rather than on a rational appraisal
of make or buy - which might suggest bringing
some services back in-house.
• In connection with the above point, the
authorities were developing necessary skills in
contract negotiation and monitoring on a
rather ad hoc basis. Since these areas seemed
to be seen as the responsibility of nance staff,

professional accounting bodies should perhaps
place more explicit emphasis on training their
members in these skills.
• The government should practice more of what
it preaches. Policy at central government level
is not joined up, resulting in damaging rivalry
between ministries such as the ODPM and the
DFES.
• In a period when council taxes have generally
risen so quickly, central government should
be less quick to scapegoat local government
for problems that government has caused. On
its part, local government should try to
improve its public image and demonstrate
that in many areas it is doing a very good job.
Local government has re-invented itself but the
knowledge and nature of the improvements are
not as widely appreciated, as they should be.
• In connection with the last point, it is
important to recognise the many benets that
accrue from the decentralisation of political
power to locally elected bodies and resist the
centralising pressures that emerge when
central/local relations become strained.
Back to Contents
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
1. This study was conducted just before the proposed changes in the role of schools and local authorities set out in the recent Educations Bill (HMSO, 2006)
Copyright © CIMA 2006
First published in 2006 by:

The Chartered Institute
of Management Accountants
26 Chapter Street
London SW1P 4NP
Printed in Great Britain
The publishers of this document consider that it is a worthwhile contribution to discussion, without necessarily sharing the views
expressed which are those of the authors.
No responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication can
be accepted by the author or publishers.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by
any means, method or device, electronic (whether now or hereafter known or developed), mechanical, photocopying, recorded or
otherwise, without the prior permission of the publishers.
Translation requests should be submitted to CIMA.
ISSN1744 - 7038 (online)
ISSN1744 - 702X (print)
Researcher’s contact details
Will Seal
Professor of Management Accounting
Business School
Loughborough University
Leicestershire
LE11 3TU
UK
E.
Amanda Ball
Professor of Accounting
College of Business and Economics
University of Canterbury
Private Bag 4800
Christchurch 8020

New Zealand
E.
Back to Contents
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
7 | Research Executive Summaries Series
References
Audit Commission (1999), Planning to succeed: service and nancial planning in local government. Audit Commission, London.
Audit Commission (2001), Changing Gear: Best Value Annual Statement 2001. />Audit Commission (2002), The comprehensive performance assessment framework for single tier and county Councils. Audit Commission, London.
Audit Commission report (2003), on council tax rises.
Ball, A., Broadbent, J. and Jarvis, T. (2003), Waste Management, the Challenges of the PFI and ‘Sustainability Reporting’. Royal Holloway, University of London
working paper.
Barley, S.R. and Tolbert, P.S. (1997), Institutionalization and Structuration: studying the Links between Action and Institution. Organization Studies, Vol. 18, No.1, pp.
93-117.
Beck, U. (2001), Living your own life in a runaway world: Individualisation, globalisation and politics, in Giddens, A. and Hutton, W. (Eds) (2001) On the edge:
living with global capitalism. Vintage, London, pp. 164-174.
Benington, J., Bovaird, T., Geddes, M., Hartley, J., Lewis, M., Sanderson, I., Sapwell, P. (1999), Evaluating Best Value: approaches to the Monitoring and Evaluation of
the National Best Value Pilot Programme. Warwick/DETR Best Value Series Paper No. 3. (University of Warwick).
Birch, A.H. (1984), Overload, ungovernability and delegitimation: the theories and the British case. British Journal of Political Science, Vol. 14 (2), pp.135-160.
Birkin, F., Edwards, P. and Woodward, D. (2002), Accounting’s Contribution to a Conscious Cultural Evolution: An End to Sustainable Development. Paper presented
at the Critical Perspectives on Accounting conference, New York, April.
Blair, T. (2002), Targets: they were a rod for our back to make sure that we were as bold as could be. The Guardian, December 20, p. 4.
Bovaird, T. (1998), Achieving Best Value through Competition, Benchmarking and Performance networks. Warwick/DETR Best Value Series Paper No. 6,
(University of Warwick).
Bovaird, T., Loefer, E. and Martin, J. (2003), From corporate governance to local governance: stakeholder-driven community score-cards for UK local agencies?
International Journal of Public Administration, Vol. 26, Nos. 8 and 9, pp.1037-1060.
Bowerman, M and Ball, A. (2001), The state of benchmarking in the UK local government sector. Chartered Institute of Management Accountants, London.
Boyce, G. (2000), Public discourse and decision making: exploring possibilities for nancial, social and environmental accounting. Accounting, Auditing and
Accountability Journal, Vol. 13 (1), pp. 27-64.
Broadbent, J., Jacobs, K. and Laughlin R. (2001), Organisational resistance strategies to unwanted accounting and nance changes: The case of general medical

practice in the UK. Accounting, Auditing and Accountability Journal, Vol. 14, No. 5, pp. 565-586.
Broadbent, J. and Laughlin, R. (1998), Resisting the ‘new public management’: absorption and absorbing groups in the UK. Accounting Auditing & Accountability
Journal, Vol. 11 No. 4, pp. 403-435.
Bromwich, M. and Lapsley, I. (1997), Decentralisation and management accounting: recycling old ideas? Financial Accountability and Management, 13, 2, pp.
181-201.
Brown, G. (2001), Foreword to the White paper, Strong Local Leadership – Quality Public Services.
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Research Executive Summaries Series | 8
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Burns, J. and Scapens, R. (2000), Conceptualising management accounting change: an institutional framework. Management Accounting Research, 11, pp. 3-25.
Callinicos, A. (2001), Against the third way: An anti-capitalist critique. Polity, Cambridge.
Carlisle, E. (1972), The conceptual structure of social indicators. In Social Indicators and Social Policy. Shoneld, A. and Shaw, S. (Editors) (Heinemann, London).
Cazes, B. (1972), The development of social indicators: a survey. In Social Indicators and Social Policy. Shoneld, A. and Shaw, S. (Heinemann, London).
Chandler, J.A. (2001), Local Government Today (3e). Manchester University Press, Manchester.
Covalski, M.A. (1983), Budgeting as a means for control and loose coupling. Accounting, Organizations and Society, Vol. 8, no. 4, pp. 323-340.
Covalski, M.A. and Dirsmith, M.W. (1988), The use of budgetary symbols in the political arena: an historically informed eld study. Accounting, Organizations and
Society, Vol. 13, No 1. pp. 1-24.
Cyert, R. and March, J. (1963), A Behavioral Theory of the Firm. Prentice-Hall, New Jersey.
Dando, N. (2000), Here’s to health: using social and environmental accounting in the UK’s National Health Service, AccountAbility Quarterly, 14, 3rd Quarter, pp.
10-12.
Danziger, J. (1978), Making Budgets: public Resource Allocation. Sage, Beverley Hills.
Davis, O, Dempster, M.A.H. and Wildavsky, A. (1966), A theory of the budgetary process. American Political Science Review, Vol. 60, pp.529-47.
Dawson, D. (1985), Economic Change and the Changing Role of Local Government. In Loughlin, M., Gelfand D. and Young, K. (Eds) (1985). Half a century of
municipal decline, 1935-1985, Allen & Unwin, London, pp. 26-50.
Department of Environment, Transport and Regions (DETR) (1998), Modern Local Government: In Touch with the People, White Paper, July, London.
Department of Environment, Transport and Regions (1999), Best Value Performance Plans: Practice and Procedures, White Paper, December. London.
Department of Local Government, Transport and Regions (DLTR) (2001), Strong Local Leadership - Quality Public Services.
DiMaggio, P. and Powell, W. (1983), The Iron Cage Re-visited:institutional Isomorphism and Collective Rationality in Organizational Fields. American Sociological

Review, Vol. 48, pp. 147-160.
Dirsmith, M., Heian, J. and Covaleski, M. (1997), Structure and Agency in an institutionalized setting: the application and transformation of control in the big six.
Accounting, Organizations and Society, 22, 1, pp. 1-27.
Downs, A. (1960), Why the government budget is too small in a democracy. World Politics, Vol. 12 (4), pp. 541-563.
Edwards, P., Ezzamel, M., Robson, K. and Taylor, M. (1995), Comprehensive and incremental budgeting in education: the construction and management of formula
funding in three English local education authorities. Accounting, Auditing and Accountability Journal, Vol. 9, No. 4, pp. 4-37.
Edwards, p. Ezzamel, M., McLean, C. and Robson, K. (2000), Budgeting and strategy in schools: the elusive link. Financial Accountability & Management,
November, pp. 309-334.
Elcock, H, Jordan, G, Midwinter, A. (1989), Budgeting in Local Government: managing at the margins. Longman, Harlow.
Emery, F. E. and Trist, E.L. (1965), The causal texture of organizational environments. Human Relations, Vol. 18, pp. 21-32.
9 | Research Executive Summaries Series
Research Executive Summaries Series | 10
Espeland W. N. and Stevens, M.L. (1998), Commensuration as a social process. Annual Review of Sociology, Vol. 24, pp. 313-343.
Ezzamel, M. and Bourn, M. (1995), Budget allocation in a UK university: contrasting periods of resource availability with resource scarcity. Journal of Management
Studies, Vol. 32 (3), pp. 313-335.
Filkin, G., Allen, E., and Williams, J. (2001), Strategic Partnering for Local Service Delivery. NLGN publications, London.
Fowles, A. J. (1993), Changing notions of accountability: a social policy view. Accounting, Auditing and Accountability Journal, Vol. 6 (3), pp. 97-108.
Giddens, A. (1979), Central problems in Social Theory: action, Structure and contradiction in social analysis. Macmillan, Basingstoke.
Giddens, A. (1984), The Constitution of Society. Polity Press, Cambridge.
Giddens, A. (1991), The Consequences of Modernity. Polity Press, Cambridge.
Giddens, A. (1998), The Third Way. Polity Press, Cambridge.
Giddens, A. (2001), Beyond the Third Way. Polity Press, Cambridge.
Gray, R. (1992), Accounting and Environmentalism: an exploration of the challenge of gently accounting for accountability, transparency and sustainability.
Accounting, Organisations and Society, Vol. 17, No. 5, pp. 399-425.
Gray, R. (1997), The practice of silent accounting. In Zadek, S., Pruzan, P., and Evans, R. (Eds) Building Corporate Accountability: Emerging Practices in Social and
Ethical Accountability, Auditing and Reporting. Earthscan, London.
Gray, R. (2001), Thirty years of social accounting, reporting and auditing: what (if anything) have we learnt? Business Ethics: A European Review, Vol. 10 (1), pp.
9-15.
Gray, R. (2002), The social accounting project and Accounting, Organizations and Society: privileging engagement, imaginings, new accountings and pragmatism
over critique. Accounting, Organizations and Society, Vol. 27, No. 7, pp. 687-708.

Greenwood, R. (1983), Changing patterns of budgeting in English local government. Public Administration, Vol. 61, Summer, pp. 149-168.
Grey, C. and Garsten, C. (2001), Trust, Control and Post-bureaucracy. Organization Studies, 22/2, pp. 229–250.
Hale, R, and Capaldi, A. (2003), (eds.) Councillors’ Guide to Local Government Finance. London, CIPFA.
Hammer, M. and Champy, J. (1995), Re-Engineering The Corporation: a manifesto for business revolution. Nicolas Brealey publishing, London.
Harte, G. F. and Owen, D. (1987), Fighting De-Industrialisation: The Role of Local Government Social Audits. Accounting, Organisations and Society, Vol. 12, No. 2,
pp. 123-141.
Henriot, P.J. (1970), Political Questions about social indicators. The Western Political Quarterly, Vol. 23(2), pp. 235-255.
Henriques, A. Civil society and social auditing (2001), Business Ethics: A European Review, Vol. 10(1) pp. 40-44.
Hetherington, P. (2004), Council tax rebels march on Whitehall. The Guardian, January 17, p. 6.
HMSO (2006), Education and Inspections Bill. London: HMSO.
HMSO (1999), Modernising Government. White Paper, London, Cm 4310.
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Hofstede, G. (1968), The Game of Budgetary Control. Tavistock, London.
Hood, C. (1995), The ‘new public management’ in the 1980’s: variations on a theme. Accounting, Organizations and Society, Vol. 20, No. 2/3, pp. 93-109.
Hostede, G. (1981), Management Control of Public and Not-for-prot Activities. Accounting, Organizations and Society, 6, 3, pp. 193-211.
Humphrey, C., Miller, P. and Scapens, R.W., (1993), Accountability and accountable management in the UK public sector. Accounting Auditing & Accountability
Journal, 6, pp. 7-29.
Humphrey, C., Miller, P. and Smith, H., (1998), Financial Management in the UK Public Sector: Ambiguities, Paradoxes and Limits, In Olson, O., Guthrie, J., and
Humphrey, C. (Eds) (1998) Global Warning! Debating International Developments in New Public Management Financial Management. Cappelen Akademisk
Forlag as, Oslo.
Hurst, G. (2004), Rich to pay for radical reform of council tax. The Times, January 12, p. 1.
Jones, C.S. (2002), The attitudes of British National Health Service Managers and Clinicians towards the introduction of Benchmarking. Financial Accountability &
Management, 18 (2), May, pp. 163-187.
Jones, R. and Pendlebury, M. (1996), Public Sector Accounting, 4th Edition. Pitman, London.
Kantor, P. and David, S. (1983), The political economy of change in urban budgetary politics: a framework for analysis and a case study. British Journal of Political
Science, Vol. 13 (July), pp. 251-274.
Keenan, J. (2000), Just How New Is Best Value? Public Money and Management, July-September, pp. 45-49.

Lapsley, I. (1999), Accounting and the New Public Management: instruments of Substantive Efciency or a Rationalising Modernity. Financial Accountability &
Management, 15 (3) & (4), pp. 201-208.
Lapsley, I. and Pallot, J. (2000), Accounting, management and organizational change: a comparative study of local government. Management Accounting
Research, 11, pp. 213-229.
Lapsley. I. (2001), Accounting, Modernisation and the State. Financial Accountability & Management, 17 (4), November, pp. 299-302.
Laughlin, R.C. (1991), Environmental disturbances and organizational transitions: some alternative models. Organizational Studies, 12(2), pp. 209-232.
Leach, S. and Charteris, S. (2000), Managing the budgetary process in a hung council. Public Administration, 78, no. 4, pp. 793-814.
Lehman, G. (1999), Disclosing new worlds: a role for social and environmental accounting and auditing. Accounting, Organizations and Society, 24, pp. 217-241.
Lewis, L. (2000), Environmental Audits in Local Government: a useful means to Progress in Sustainable Development. Accounting Forum, Vol. 24 (3) pp. 296-318.
Lewis, M. (1998), Achieving Best Value through Quality Management. Warwick/DETR Bets Value Series, Paper number 9, December (University of Warwick).
Lindblom, C. (1959), The Science of ‘Muddling Through. Public Administration Review, 19, pp. 79-88.
Lindblom, C. (1968), The policy-making process. Prentice-Hall, Englewood Cliffs, NJ.
Llewellyn, S. (1997), Purchasing power and polarized professionalism in British medicine. Accounting, Auditing & Accountability Journal, Vol. 10, No. 1, pp. 31-59.
Local Government Association (LGA) (2004), Building on Success: a second generation of Local Public Service Agreements. London: LGA.
11 | Research Executive Summaries Series
Research Executive Summaries Series | 12
Macintosh, N. (1994), Management Accounting and control Systems: an organizational and behavioral approach. Wiley & Sons, Chichester.
Macintosh, N. (1995), The ethics of prot manipulation: a dialectic of control analysis. Critical Perspectives on Accounting, 6, pp. 289-315.
March, J.G. and Simon, H.A. (1958), Organizations, Wiley, New York.
Martin, S. (1998), Achieving Best Value through Public Engagement. Warwick/DETR Best Value Series, Paper No. 8.
Mayston, D. (1998), Devolved budgeting, formula funding and equity. Management Accounting Research, 8, pp. 37-54.
McPhail, K. (2003), Care in the Community: Professional Ethics & the Paradox of Pro Bono. Paper presented at the Challenge of Business Ethics Conference,
Cambridge 7-8 April 2003.
Meyer, J. W. (1986), Social environments and organisational accounting. Accounting, Organisations and Society, Vol. 11 (4/5), pp. 345-356.
Meyer, J. and Rowan, B. (1977), Institutionalized Organizations: Formal Structure as Myth and Ceremony. American Journal of Sociology, 83, pp.340-363.
Meyer, J. and Scott, W.R. (1992), Centralization and the legitimacy problems of local governments. In J. Meyer, W.R. Scott (Eds), Organizational Environments:
Ritual and Rationality, (revised edition). Sage, pp. 199-216.
Miles, R. and Snow, C., (1978), Organizational Strategy, Structure, and Process, McGraw-Hill, New York.
Naughtie, J. (2001), The Rivals: the intimate story of a political marriage. Fourth Estate, London.
O’Dwyer, B. (2001), The legitimacy of accountants’ participation in social and ethical accounting, auditing and reporting. Business Ethics: A European Review, Vol.

10 (1), pp. 27-39.
Oliver, C. (1992), The Antecedents of deinstitutionalization. Organization Studies, 13/4, pp. 563-588.
Olson, O., Humphrey, C. and Guthrie, J. (2001), Caught in an evaluatory trap: a dilemma for public services under NPFM. The European Accounting Review, Vol. 10
(3), pp. 505-522.
Olson, O., Guthrie, J. and Humphrey, C. (Eds.) (1998), Global Warning! Debating international developments in New Public Management Financial Management.
Cappelen Akademisk Forlag, Oslo.
Osbourne, D. and Plastrik, P. (1997), Banishing Bureaucracy: the ve strategies for reinventing government. Addison Wesley, Reading, Mass.
Owen, D. and Swift, T. (2001), Social accounting, reporting and auditing: beyond the rhetoric. Business Ethics: A European Review, Vol. 10 (1), pp. 4-8.
Pfeffer, J. (1981), Power in Organizations. Pitman, Boston.
Puxty, A.G. (1991), Social accountability and universal pragmatics. Advances in Public Interest Accounting, Vol. 4, pp. 35-46.
Pyke, N. (2003), Rebels with a cause. Independent, 26 June, pp. 8-9.
Riddell, P. (2002), New Labour is in danger of trying to do too much. The Times, September 2, p. 16.
Rose, R. (1973), Models of governing. Comparative Politics, Vol. 5 (4), pp. 465-496.
Ryan, C. (2003), Where has all our money gone? Public Finance, May, pp. 20-23.
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Research Executive Summaries Series | 13
Research Executive Summaries Series
Re-inventing budgeting: the impact of third way modernisation on local government budgeting
Scapens, R. (1990), Researching management accounting practice: the role of case study research. British Accounting Review, vol. 22, pp. 259-81.
Seal, W. (1999), Accounting and compulsory competitive tendering: an institutionalist interpretation of the new public management in UK local government.
Financial Accountability and Management, Vol. 15, Nos. 3&4, pp. 309-327.
Seal, W. (2003), Modernity, modernization and the deinstitutionalisation of incremental budgeting in local government. Financial Accountability and Management
Journal, Vol. 19, no. 2, pp. 93-116.
Seal, W. and Ball, A. (2005a), Regulating corporate performance and the managerialization of local politics. International Public Management Review, 6, 2005, No.
1, 117-138.
Seal, W. and Ball, A. (2005b), Public service delivery, budgeting and modalities of power in a ‘Third Way World’. Paper presented at the public sector accounting
workshop, University of Edinburgh.
Shearer, T. (2002), Ethics and accountability: from the for-itself to the for-the-other. Accounting, Organisations and Society, Vol. 27, pp. 541-573.
Shaoul, J. (2000), On the wrong track? Public Finance, November, pp. 3-9.

Stewart, J. (2000), The Nature of British Local Government, Macmillan, Basingstoke, Hampshire, UK.
Stoker, G. (1996), The Struggle to Reform Local Government: 1970-95. Public Money and Management, Vol. 16, No. 1, pp. 17-22.
Stoker, G. (2001), Local Government: You are the weakest link. Goodbye. Paper presented at the ESRC Seminar Series: Seminar 1: Local Government and Local
Governance in the UK. 28th September 2001. University of Aston, UK.
Telford, B. (2002), The Use of Environmental Management Techniques in Local Authorities. Paper presented to the British Accounting Association Annual
Conference, Jersey, 3-5 April 2002.
Temple, M. (2001), Anthony Giddens, Tony Blair and the Third Way. In Bryant, C. and Jary,D. (Eds) The Contemporary Giddens. Palgrave.
Tinker, T. and Gray, R. (forthcoming), Beyond a Critique of Pure Reason: From Policy to Politics to Praxis in Environmental and Social Research, Forthcoming in
Accounting, Auditing and Accountability Journal.
Tinker, T., Lehman, C. and Neimark, M. (1991), Falling down an hole in the middle-of-the-road: Political Quietism in Corporate Social Reporting. Accounting,
Auditing and Accountability Journal, Vol. 4, No. 2.
Uslu, P. (2002), Implementation of Benchmarking in NHS Trusts. Unpublished Doctoral Thesis, University of East Anglia.
Walsh, K. (1995), Public Services and Market Mechanisms: Competition, Contracting and the New Public Management. Macmillan, London.
Wildavsky, A. (1964), The politics of the budgetary process, Little Brown, Boston, MA.
Wildavsky, A. (1975), Budgeting: A comparative theory of budgetary process. Little Brown, Boston.
Wildavsky, A. (1986), Budgeting: A comparative theory of the budgetary process, 2nd ed. Transaction Publishers, New Brunswick, NJ and Oxford.
Williams, H. (1989), Hegel, Heraclitus and Marx’s Dialectic, Harvester Wheatsheaf. New York.
Williamson, O. (1985), The Economic Institutions of Capitalism. Free Press, New York.
Willmott, H. (1987), Studying Managerial Work: a critique and a proposal. Journal of Management Studies, 24, 3, pp. 249-270.
Back to Contents

CIMA, the Chartered Institute of Management Accountants, represents members and supports the
wider nancial management and business community. Its key activities relate to business strategy,
information strategy and nancial strategy. Its focus is to qualify students, to support both
members and employers and to protect the public interest.
The Chartered Institute
of Management Accountants
26 Chapter Street
London SW1P 4NP
T. +44 (0)20 7663 5441

F. +44 (0)20 7663 5442
E.
www.cimaglobal.com
REF: TE035V0506