The report presents the conclusions made on the basis of the audit findings as well as summaries of the audit findings that are of material importance to Parliament. The report also assesses whether positions adopted by Parliament on the basis of reports of the Audit Committee have resulted in any measures. Furthermore, the report presents a review of the National Audit Office’s activities and their effectiveness during the 2013 budget year.
The report is based on the performance audits, financial audits, compliance audits and fiscal policy audits conducted by the National Audit Office and its activities as an expert body. The most important audit findings presented in this report are from the financial audits that were completed in spring 2014 and that cover the 2013 budget year. The performance and compliance audits and follow-ups to them conducted by the end of August 2014 are included in the report.
The National Audit Office’s report on its activities to the 2014 parliamentary session has two main themes: the prerequisites for implementing the Government’s structural policy programme and good governance.
Even though, on the basis of the audits, it is still not possible to report on the implementation of the structural policy programme or the achievement of the targets laid out in it we have nevertheless made an attempt to assess the prerequisites of the programme.
By adhering to good governance, government actors are able to operate in a performance-oriented and effective manner, which also facilitates the implementation of the structural policy programme.
Prerequisites for the implementation of the structural policy programme
The measures laid out in the section on labour market and working careers are, on the basis of the audits, appropriate and feasible. However, the limited number of the implementation tools makes it more difficult to achieve some of the targets. Weak economic growth underlines the importance of the measures impacting the structure of the labour market.
In its inputs into the development of intangible capital, Finland has put more emphasis on traditional research and development than other countries. Almost 50 per cent (about 900 million euros) of all research and development funding provided by the state goes to promoting general academic research. The most important recipients are universities and the Academy of Finland. Even though there has been a lot of attention on the development of funding models, they do not give enough consideration to the application of research findings in such areas as cooperation with companies.
The public sector can only operate successfully if it relies on target-oriented management practices and it is steered in an efficient manner.
In general, the steering systems of individual administrative branches are functioning reasonably well. However, more use should be made of economic analyses in the preparation of strategies for administrative branches. The strategies should also be clearly linked with economic planning. At the same time, however, there should be a critical review of the number of the strategies and special consideration should be given to the perspective of their implementation.
There has been an improvement in the trueness and fairness of the information on operational efficiency contained in the final accounts of the accounting offices in recent years. The information would, however, be more usable if the figures on operational efficiency and the manner in which they are presented was harmonised and clarified.
The comprehensiveness of the economic efficiency targets set by the ministries and the information on them presented by the accounting offices in their reviews of operations are used as the criteria for assessing the success of the performance guidance. On the basis of the audit, one accounting office in two has workable performance guidance arrangements, when assessed in this manner. Compared with the previous years, there has been little change in the proportion of accounting offices that are guided by adequate economic efficiency targets and that present true and fair information in their final accounts.
The National Audit Office has assessed the legislative drafting process in the Ministry of Transport and Communications, Ministry for Foreign Affairs and the Ministry of Finance. Conclusions on how the legislative drafting process should work in a unified Government can be made on the basis of the audits.
A number of audits contain critical observations of the manner in which the effectiveness of laws is evaluated. The National Audit Office has on several occasions recommended that the Government should establish a unit for supervising the quality of the effectiveness evaluations.
In the drafting of laws, support for employment and economic growth has manifested itself as the introduction of different types of state aid and tax cuts. Many of these legislative changes have had major economic impacts. In its report to the 2014 parliamentary session, the National Audit Office draws attention to the ex-post assessment of the impacts and cost-effectiveness of the economic stimulus measures.
The views concerning the benefits generated by export financing are not based on adequate facts. As the state has substantial and growing liabilities there are grounds for obtaining more solid information about the benefits of export financing to central government finances.
Effectiveness of the audit operations
The effectiveness of the work carried out by the National Audit Office is, to a large extent, a result of the preventive and accountability impacts of the audits and monitoring. However, the National Audit Office also monitors and assesses the implementation of the positions adopted by Parliament on the basis of the audits and the implementation of the opinions that NAOF has presented in its audits.
In its report to the 2014 parliamentary session, the National Audit Office draws attention to the fact that in its annual report, the Government has not reported on the tax gap and the amount of unpaid taxes in a manner required by Parliament.
As part of its audits, the National Audit Office monitors the implementation of the opinions contained in the performance audits. Even though, in international standards, the proportion of the recommendations that are implemented remains high, the percentage has nevertheless declined. The implementation of the recommendations concerning the decision-making knowledge base is particularly slow and only a small proportion of them becomes reality.