BusinessCorporate FinanceProfile: Jon Thompson, FD of the Department for Children, Schools and Families

Profile: Jon Thompson, FD of the Department for Children, Schools and Families

He runs a department bigger than most FTSE 100 companies and persuaded the chancellor to hand over more than he expected. Our reporter meets the Department for Children, Schools and Families FD Jon Thompson, a public sector accountant with a private sector approach

Jon Thompson, Department of Children, Schools and Families

Jon Thompson, Director General, corporate services directorate

Finance directors around the country will squirm with envy when they hear how
easy it is for Jon Thompson, finance director of the Department for Children,
Schools and Families, to spot flaws in a spreadsheet, or any kind of grouping of
numbers for that matter.

At the age of 12, Thompson discovered that he had the ability to see numbers
as colours and flows. The scientific term for this is synaesthesia, and
researchers have calculated that one in 2,000 people has this extraordinary
condition in which two or more of the five senses intermingle simultaneously.

The last time he and his team were compiling the department’s Comprehensive
Spending Review, someone produced a spreadsheet and on casting his eye over it
he immediately saw the ‘wrong colours’. The numbers didn’t add up for him
because he saw lots of red. It turned out he was right, fortunately they were
several million up.

It’s reassuring to know that someone in charge of an annual budget of £70bn
worth of taxpayers’ money has this extra power over numbers to supplement a
solid technical education.

Based on this ability, Thompson instinctively leaned towards the sciences in
his education so it seemed a natural career progression for him to go down the
banking or accountancy route. The best range of options available to him at age
16 was at his local authority, Norfolk County Council, which offered vocational
education. He got a job on the finance team where he studied for the AAT
qualification part-time.

‘It’s been a fantastic career so far. It’s been very mixed. I’ve had the
opportunity to work in the public and private sectors. I’ve always done what
I’ve been interested in, rather than what might be the most natural thing to

Going private

Once qualified, the Cipfa-trained accountant left the public sector a year
later and joined Eagle Star insurance in its worldwide internal audit function
at the time when the Tory government was advocating privatisation.

‘It was a tremendous experience as they came at their business in a different
way to what I’d experienced over seven years of working for Norfolk. They were
interested in all the financials but were focused on customer satisfaction. That
opened my eyes to a different way of thinking about things; primarily about how
do we serve the customer. At the time, nearly 20 years ago, local government was
struggling with some of those concepts.’

After a few years he decided to move into practice and joined Ernst &
Young as a senior manager with a varied portfolio.

‘Again it was a fantastic experience, which I enjoyed for five and half
years. I would wholeheartedly recommend people to get that experience because
the private sector thinks differently about certain issues.’

Although he believes the two sectors are now much closer in terms of
financial management than when he started work in local government, he says
there are still significant differences because ‘we don’t have the investor
issues that private companies have’. That said, the public sector could arguably
be viewed as more complex in that there are the taxpayers’ needs and political
issues to juggle.

‘Many of the core issues of being a good strategic financial director are the
same, in terms of delivering a business plan, long-term planning and integration
of that with your financial performance. But the government is still catching
up,’ he says.

Jargon averse

The one thing that strikes you about Thompson as an FD, despite, or maybe
because, of his experience in the private sector, is that he doesn’t churn out
the usual corporate financial jargon. He prefers to avoid the ambiguous, often
meaningless, turns of phrase. He’s direct, open and relaxed for a man in charge
of a department that, if it were a private company, would figure in the FTSE top
10, bigger than Tesco and Aviva combined.

In March the department agreed its budget up to 2010, which means that
although the current clarion call within government of ‘more for less’ the
budget will have increased funding in real terms (over the rate of inflation)
but it will eventually slow down. This presents Thompson with a few challenging
years ahead. But he says his team are aware of the need to ensure value for
money and keep the purse strings tight.

‘There are several issues. We have to continue to deliver public service
reform and improve the life chances for millions of children while the fiscal
environment tightens and that will present us with a significant challenge.
Those questions are fundamentally at the heart of the department,’ he says.

In a tighter environment Thompson’s finance team, numbering 900, due to drop
because of efficiency cuts, faces a tougher time. But he’s confident they have
the right skills to ensure the future dip in investment doesn’t translate into a
dip in performance. To ensure this, the department is going through an
independent review as part of a pilot programme with Cipfa and the IPF –
Cipfa’s management support services arm – to assess financial management. ‘We
are in a decent space, but we need to build capacity, capability, systems and
processes,’ he says.

Thompson has experience of the education sector having been enlisted from
Ofsted, where he was its first FD, to the post of FD of the DCFS as part of
Labour’s 2004 pledge to have qualified accountants at the head of every
government department by 2006. He fully supports Whitehall accounting chief Mary
Keegan’s drive to continue improving government financial management and make
sure that finance is a boardroom agenda.

‘The importance of financial management has been somewhat of a lesser issue
historically in the sector. It hasn’t necessarily always been at the top table.
Culturally it was a significant step forward when the chancellor announced in
2004 that all government departments would have a qualified FD,’ he says.

Though he is in charge of one of the most important Whitehall departments,
Thompson accepts that despite the government drive to improve work/life balance
he isn’t going to be working a 35 hour week. In fact, he averages around 70
hours a week, but he does work from home one day a week which he uses to avoid
distractions and plan ahead.

Hands-on approach

His remit is very broad. As well as being in charge of finance he’s
responsible for IT, HR, procurement, estates, strategic, research and
development. He’s also responsible for the teachers’ pension scheme totally £
147bn – one of the largest in the country.

Although much of his time is taken up in meetings, particularly because of
his board member role, he’s conscious of ‘keeping in touch’ with reality and
goes out to meet heads of schools, teachers and pupils as much as his job

The job fits comfortably with his leisure activities too, which probably drew
him into the kind of work he does now. He has always been heavily involved in
community work, helping set up a local nursery in the 1990s, and continues that
work today supporting local youth and church projects.

He’s no ‘yes’ man either, relishing his negotiations with the permanent
secretary and chancellor, particularly in the allocation of funds to his
department. Although he’s not forthcoming in divulging how the last spending
review negotiations went, he confides that he probably walked away with more
than the chancellor had initially planned to give him.

‘It was a great sense of really connecting what we’re trying to do with the
money. Finance isn’t a sideshow.’

This appears to inspire him. The ability to ‘talk about finance without
talking about money, turning finance into people issues, as it were. We can
clearly link money to things you can do. If you give me another £5,000 I can
produce you another graduate. When you have that level of understanding the
conversation stops being about the money.

‘That’s the great secret, having a finance conversation that’s not about the

Get with the programme

PFI and the schools building programme

The DCSF has a hefty investment programme pumping £10bn a year into the
capital infrastructure of schools by 2010/11 called Building Schools for the
Future. As part of this investment programme the private finance initiative
plays a role. Of the annual £10bn invested, £2bn will come from PFI.

For this the government has come in for criticism being accused of risking
billions of pounds of taxpayers’ money on its schools rebuilding programme.

Of the criticisms Thompson says ‘when we entered into the programme, we had
to take a 15-year view. It’s a long term capital investment programme to
completely change the schools, so taking a short-term view is a bit premature.’

The other thing to consider, he says, is that the government has been ramping
up investment in infrastructure, ‘so we’re starting from a low base; the amount
of work you have to do on the ground took us longer than we thought. But we are
confident the programme will deliver the necessary changes that we need.’

Building Schools for the Future is an investment programme to refurbish or
rebuild every secondary school and is the largest school building programme in
50 years. Since 1997 1,106 new schools have been built, there are 27,000 new or
improved classrooms and 1,260 new children’s centres.

It means that seven classrooms have been built or upgraded on average every
day for 10 years with two entirely new schools and two children’s centres built
on average every week, according to government data.

Related Articles

SMEs at risk of getting burnt by interest rate rises – why accountants should take note

Corporate Finance SMEs at risk of getting burnt by interest rate rises – why accountants should take note

2w Marc Bajer, CEO, Hadrian's Wall Capital
Grant Thornton recruits new corporate finance partner

Accounting Firms Grant Thornton recruits new corporate finance partner

1y Emma Smith, Managing Editor
Total fraud value at £2bn five-year high, finds BDO

Accounting Firms Total fraud value at £2bn five-year high, finds BDO

1y Stephanie Wix, Writer
MHA MacIntyre Hudson appoints corporate finance director

Accounting Firms MHA MacIntyre Hudson appoints corporate finance director

1y Stephanie Wix, Writer
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

1y Stephanie Wix, Writer
KPMG announces senior partner promotion in Newcastle

Accounting Firms KPMG announces senior partner promotion in Newcastle

1y Stephanie Wix, Writer
Independent city firm reports 70% growth

Accounting Firms Independent city firm reports 70% growth

1y Stephanie Wix, Writer
Tax avoidance crackdown sees 80% jump in additional HMRC revenue

Accounting Firms Tax avoidance crackdown sees 80% jump in additional HMRC revenue

1y Stephanie Wix, Writer