A municipality’s finances cannot be based on luck. Because that’s what “stick in” means in football parlance. It is an expression that does not belong in budgeting, and in any case not in a municipality.
As full as it is this expression that has been used by the top managers in the administration in the municipality, both finance director Geir Andersen, but primarily municipal director Stig Tore Johnsen, when last year’s big budget gap had to be explained to the people and elected officials.
The explanation of a A significant part of the budget gap of a quarter of a billion, namely those belonging to financial items such as interest income and expenses, pension premiums, dividends, installments on loans and allocations from the state, has been that these are allegedly so difficult to calculate for a municipality, as many prerequisites for these items are not ready until the end of the year.
Therefore, the administration must guess when the budget is made, and most often miss a bit here, but hit the mark there. If you’re really lucky, there will be a pleasant surprise, in the form of millions in extra that you hadn’t expected, counted on a silver platter just before Christmas. Last year, on the other hand, the municipality was unlucky and had to “stick out” the entire bingo board.
The explanation, or rather said the apology, is too thin. Firstly, because it is not acceptable to have such small margins that luck is what will save the bottom line. Secondly, because, despite uncertain assumptions, it is not that difficult to calculate the financial items. If you are unsure of the outcome, it is natural to add a buffer. And here we are at the heart of the matter.
The municipality predicts another huge deficit: – Afraid that this will go to waste
This case has contributed to drawing a clearer picture of municipal director Stig Tore Johnsen, the businessman from the construction industry who became the top bureaucrat in Northern Norway’s largest municipality just over three years ago. In the time he has governed, there have certainly been scandals, such as the one that made Tromsø municipality the owner of Norway’s biggest procurement scandal. But Johnsen was still so new to the position that he got the role and image of a cleaning boy, not a director of chaos.
The site established the impression of a leader who brought order to the sewing business with detailed plans for business management and investments, and at the same time fearless and visionary. However, all character traits have their downsides, and now some of them have become clearer. The picture that emerges in the budget matter is of a leader with too much willingness to take financial risks than is good for a municipality.
It has come states that there has been no shortage of warnings from his own professionals. To that, Johnsen has replied that professional disagreement is perfectly fine, also on economics, and that as chief executive he must make “holistic assessments” and can necessarily draw different conclusions than the professionals who provide forecasts and reports outside the organisation. It is easy to question where, and from whom, the director can get a better overall picture than from the department that has professional responsibility for the budget, and that sits with both the details and the total from day to day.
Stig Tore Johnsens The “sales pitch” when he was hired as CEO was that he knew both municipal plans and budgets on the fly. It testifies to interest, work capacity and visions. It is good and desirable to have a senior manager who is actively involved in the municipality’s finances. Perhaps it should just be missing, but in the past the problem in Tromsø has been the other way around – municipal directors who have been passive, and asked few or no questions to the specialist agencies in the budget process. There is still a limit, and there is a certain hubris in Johnsen’s overriding of professional advice.
This is how the mayor responds about what he knew: – I’m sorry
The municipal director has received strong criticism from the elected representatives, who believe he has also underplayed or undercommunicated the risk in the municipality’s economy, especially before the summer of last year. It was, to the surprise of many, the Center Party’s new representative at the town hall, Kathrine Strandli, who said it most harshly during the hearing in the chairmanship. She asked, directly addressed to Johnsen, whether she could trust his financial reports in the future.
There was a leader with frantic red spots on his face who replied that his “credibility has got a scratch in the paint”. The opposition was close to falling off the chairman’s new, upholstered chairs in cognac-coloured leather. It was quite a sight. The question suddenly hung in the room: Was it now time for the dismissal to come? No. Johnsen still has the red-greens’ good graces.
It has one logical explanation, and it’s about the fact that the bell in this scandal hangs so much around the mayor’s neck, and it jingles and jingles with every little movement he makes. Then it is difficult to throw the head of administration under the bus.
Johnson does now his utmost to polish away the scratch in the paint. In the financial report released this week, he did something he failed to do last year: He presented the organization’s projections for the economy this year, without filtering it through his “holistic management assessments” first. The figures look grim, and give the mayor little opportunity to portray last year’s deficit as a “freak accident”, as they say in new Norwegian. Wilhelmsen was well underway with that. Going forward, the goal will probably be to avoid being put under state administration for their financial imprudence – sorry, accident -, popularly called the Robek list.
The municipality has blown the budget by NOK 259 million
It is also It is clear that a wedge has been driven between the mayor and the municipal director, who have gone by the nickname “Knoll and Tott” among both employees and managers at the town hall. It was not meant positively. Both men, with their strikingly similar business backgrounds, have learned a hard-earned lesson.
It might be more formal at the town hall in the future – or formalistic, if you don’t like the exaggerated focus on the fact that now everyone has to keep their tongues in their mouths. It doesn’t have to mean that it becomes more boring. On the contrary, perhaps more contradictions, discussions and decisions will come out in the open. It is good for both the economy and the wallet. Because one thing is certain, Tromsø municipality must stop bingo budgeting as soon as possible. Stick in and stick out only belong on the football pitch.
