Public value under pressure

Headlines from ten years of audit reports

City of Rotterdam | 2019

The Audit Office has investigated the substantive similarities (‘common themes’) found in the conclusions of 42 reports it published on the municipality of Rotterdam between 2009 and 2019.

Administrative overconfidence and excessive regulation

The council is repeatedly overconfident in its plans and consequently takes on too many (financial) risks. Furthermore, the council often relies too heavily on rules and procedures, paying too little attention to practical implementation issues and residents’ everyday lives. These and other conclusions are set out in the Audit Office’s report ‘Public value under pressure’, a summary of dozens of investigations carried out by the Rotterdam Audit Office in the municipality of Rotterdam since 2009.

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Cracks appearing in financial relations

On investment and solvency

Jack Kruf en Caspar Boendermaker | juni 2019

In April 2019, in consultation with BNG Bank, the annual PRIMO/UDITE meeting of the ‘From Global to Local’ think tank took place. Around 15 public-sector leaders met with BNG Bank to discuss the challenges facing local authorities.

The cracks in the local authority’s financial system are clearly visible.

The recently published Global Risks Report 2019 by the World Economic Forum and a presentation by the City of Delft revealed cracks in the financial situation. Is the financial resilience of the city and region at risk?

Transitions require investment, whilst the council’s solvency is under pressure.

The City of Delft presented its ambitious long-term investment strategy. Investments totaling at least 1.4 billion euros are planned through 2040, of which the council will have to cover approximately 25%.

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Resilient Cities Catalyst

Resilient Cities Catalyst | 2019

In partnership with a community of urban resilience actors, RCC leverages experience and a pioneering ecosystem of partners and practitioners to apply lessons, insights, and resources to advance this critical work. RCC works with cities to build the local capacities and partnerships needed to understand, prioritise and concretely address each city’s risk and chronic stress as it pursues strategic goals or recovers from a crisis.

Urban Practitioners

RCC is a network of urban practitioners with deep experience in municipal government service design and delivery, public and private funding and financing, and philanthropic partnership development.

“Our resilience approach rests on three pillars – integrated assessment, planning and action, inclusive governance, and a forward-looking risk-based methodology.”

RCC’s resilience approach rests on three pillars – integrated assessment, planning and action, inclusive governance, and a forward-looking risk-based methodology – that build lasting capacity to address the deep-rooted problems that often impede progress at the project, neighbourhood, city and regional scales.

Their professional experiences cover a breadth of technical domains, from economic development to affordable housing to climate change adaptation to urban mobility and beyond. We know the way cities budget, the way cities plan and procure, and how cities operate.

Resilience Experts

RCC is a network of resilience experts who are pioneers in the urban resilience movement. They have collectively partnered with more than 100 cities worldwide to catalyse and support their resilience-building journeys to deliver impact for their communities.

Strategic Conveners

RCC is a group of strategic conveners who understand the importance of bringing uncommon partners and practitioners together. They have built action-oriented communities of practice and networks of diverse actors centred on complex challenges like urban migration, natural infrastructure, seismic resilience, and more.

The secret of risk management

John O’Dea | April 2009

Risk Management is as old as Methuselah. Although there are no records in the book of Genesis that indicate that Adam and Eve carried out a risk assessment, their world and ours might have been a different place had they given it some thought.

John O’Dea

The world might also have been a different place had the developed nations – with their reputedly state of the art management tools – applied them with the base integrity assumed in any formalized risk management process.

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Financial strategy in times of transition

Think tank ‘From Global to Local’ 2019

PRIMO Europe | juli 2019

PRIMO is organising the 6th ‘From Global to Local’ Think Tank in The Hague on Friday, 5 April 2019, in close collaboration with BNG Bank and UDITE. The findings, based on a survey of our members, are consistent with national and international reports: we are witnessing a combination of societal transitions. These are taking place simultaneously and genuinely call for reflection and a reassessment of financial strategy in the public sector.

De Denktank 2019. V.l.n.r. Gido ten Dolle (Delft), Tom Schulpen (Noord-Brabant), Henriëtte de Jong (Groningen), Ad Verbakel (Eindhoven), Teun Eikelboom (Ministerie BZK), Johan de Kruijf (Radboud Universiteit), Hans van Lent (Ede), Hans Krul (Delft), Jan Willem Dijk (Assen), Bert Hummel (BNG Bank), Caspar Boendermaker (BNG Bank), Jaap Zwaan (Medemblik) en Jack Kruf (PRIMO).

These include transitions in the social sector, the Environment Act, digital transformation (cybersecurity, privacy, artificial intelligence, big data), the energy transition, the circular economy and climate change. They are placing significant pressure on financial resources in terms of maintaining society’s resilience. It appears to be a systemic issue.

The recent letter from Seth Klarman to investors is on the table. Klarman is a hedge fund manager, CEO and portfolio manager of the Baupost Group. To put it mildly, he draws attention to the growing problem of government debt.

Above all, it is clear that there is a great need for innovation in the form of practical and concrete financial instruments. It would appear that sound financial governance and management once again form the foundation of our future. Hence, a 2019 PRIMO think tank that delves into the status quo, scenarios and concrete tools, exploring both administrative ambition and financial realism. Looking in the rear-view mirror and peering under the bonnet are important, but no longer sufficient. Ex post democratic accountability is essential, but ex ante financial architecture – which actually works and can be linked to scenarios – is certainly becoming a critical success factor.

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Is there sufficient financial capacity to cope with these transitions?

Johan de Kruijf and Jack Kruf | April 2019

The title was one of the key questions raised at the ‘From Global to Local’ think tank on 5 April. Given the transitions currently underway, the rise in risks within the public sector and the gradual accumulation of backlogs in management and maintenance, this question was brought to the fore. So what is the actual financial situation in the Netherlands? An initial exploration. Less rosy? Hairline cracks? Not really recovered from the credit crisis, now 10 years ago? The series of financial setbacks regarding the transition of the social sector is not yet over and is leaving deep scars. Are we pessimists? No, not at all; realists. Nothing more than that. The first outlines.

Key figures and basic statistics

Since 2016, local authorities and provincial councils in the Netherlands have been using a set of fixed key figures to assess their financial position. We highlight solvency, the unadjusted net debt ratio and EMU debt. Sources include Statistics Netherlands, waarstaatjegemeente.nl and the Netherlands Environmental Assessment Agency.

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Global reconstruction of historical ocean heat storage and transport

L. Zanna, S. Khatiwala, J.M. Gregory, J. Ison, & P. Heimbach | January 2019, in Proceedings of the National Academy of Sciences 

Zanna et al. (2019): “Since the 19th century, rising greenhouse gas concentrations have caused the ocean to absorb most of the Earth’s excess heat and warm up. Before the 1990s, most ocean temperature measurements were above 700 m and therefore, insufficient for an accurate global estimate of ocean warming. We present a method to reconstruct ocean temperature changes with global, full-depth ocean coverage, revealing warming of 436 x 1021 Joules since 1871.

Our reconstruction, which agrees with other estimates for the well-observed period, demonstrates that the ocean absorbed as much heat during 1921–1946 as during 1990–2015. Since the 1950s, up to one-half of excess heat in the Atlantic Ocean at midlatitudes has come from other regions via circulation-related changes in heat transport.”

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