e-GOVERNMENT IN FINLAND - ePractice.eu

equired to provide e-government strategic plans, that is has started to receive more detailed information on
goals and performance. When asked if there were barriers in the budgeting system to developing IT
systems, an MoF official replied that the ministry is trying to make better use of all information regarding
costs and expenses. Agencies’ strategic plans will be used for budget planning purposes for the first time in
March 2003.
87. The OECD’s The E-government Imperative (2003) points out that another way to fund crossorganisation
IT projects is to improve mechanisms for shared spending. Officials from the Government’s
Information Management Unit argued that they would be better able to promote further collaboration if
ministries could contribute their share of the costs of common systems. The unit’s budget is based on the
cost of the previous system and it provides its services free of charge.. While the unit has no reason to
charge for basic services such as access to Government systems, it would like to be able to ask ministries
to pay their share when they benefit from the shared services it might propose (e.g. a common financial,
case management or e-mail system).
Key Points - 13
x Central funds have been effectively used for the development of e-enablers such as the
Citizen’s Portal. However, the MoF is only now starting to collect the information that it
would need in order to better link budgeting and performance and to make informed
central budget allocations if it were to create any central funds.
x Central funding earmarked for cross-administration projects could also help create
incentives for collaboration. However agencies should show how such funding will lead to
integrated services rather than services provided by one agency for others.
x It may be useful to examine joint funding systems that would allow ministries and agencies
to contribute to the costs of a shared IT project.
Capital versus operational expenditures
88. The OECD’s The E-government Imperative (2003) calls attention to the risk of inappropriate ICT
funding decisions due to difficulties with the treatment of major ICT capital expenditures and with funding
requirements over long time periods. As in many other OECD countries, IT spending in Finland is treated
as an operating rather than a capital expenditure so that spending is calculated on an annual cash basis. In
interviews, however, this was not raised as a major source of difficulty for developing IT systems. To treat
IT spending as investment, better information on performance would be needed in order to estimate egovernment
benefits.
89. The OECD’s The E-government Imperative (2003) suggest that classifying major ICT projects as
capital investment would enable a fairer comparison of such investments with recurrent spending
alternatives. In Finland the adequacy of annual budgets and the lack of focus on return on investments
could explain the fact that IT spending is integrated with overall operating costs rather than treated as a
separate cost category. This fact has actually helped to lessen the danger of competition between spending
on ICT and on other substantive programmes and had the added advantage of linking ICT spending to
related e-government back office implementation investment (such as change management and/or process
re-engineering) that are also crucial to a project’s success. However, few agencies have taken these
measures and limited funds are available.
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