News : IMA responds on government contractors
The Chief Financial Secretary, Danny Alexander instructed a government review of contractors working in government and it is now feared that this could remove highly skilled and flexible executives who have a track record of delivering results.
Commenting on the review, Jason Atkinson, chairman of the Interim Management Association (IMA), said:
“The Government is right to review its use of long-term contractors. It is sensible to review who should be on the payroll and the IMA strongly agrees that a robust system should be in place to seek assurances regarding the income tax and NICs obligations of all contractors. We welcome the investigation of anyone seeking to avoid tax.
“However, Danny Alexander’s letter would suggest they are at risk of throwing the baby out with the bath water. By applying this review to all senior interim executives, the Government could lose the ability to quickly deploy highly skilled interim managers, on short-term contracts to deliver specific results immediately and effectively, which is often critical in the public sector.
“The private sector has recognised how vital the role of a true interim manager is and the market for their skills is growing significantly. In fact, now worth £1.5bn, this is an industry where Britain leads the world and now is not the time to take the legs away from it. It is also a successful export with nearly 15 per cent of all interim managers working overseas.
“In the spirit of ensuring best value for public money, the review should also examine the associated costs of bringing individuals onto the payroll, given the holiday, pensions and insurances inherent in an employment relationship. It is also worth considering the cost of alternative models that could be even more costly, for example if departments turn instead to using more expensive management consulting firms.
“Our latest Ipsos MORI commissioned figures (March 2012) state that the average length of interim assignment stood at 166 days in 2011.
“The role of an interim manager is to provide specialist skills, developed over a career with a record of achievement, at a strategic level to solve problems and deliver result quickly. Their impartiality can be compromised when they become too close to the client over a long period of time.
“We welcome the fact that Danny Alexander’s review recognises there are circumstances where short-term contracts such as these are required – at a time when austerity measures mean less manpower and often greater demand on public sector services, high level performers with a track record of quantifiable achievement can be a vital resource for government both nationally and locally.
“2012 represents the IMA’s 25th anniversary; a year which will see us launching the IMA Approved Campaign, promoting a strict and regularly audited code of practice to which all our members will adhere. This badge of quality is underpinned by a 12-point check list, ensuring our members select and appoint only the best interim managers, guaranteeing that clients are provided with sound advice on the use of interim management.”
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