What is the public sector like in your country?

Gary Kent, commissioner of Corporate Services and CFO for The City of Mississauga, Ontario, Canada:

So on the financial side, Mississauga really has got a strong reputation. We have a low debt burden, we have competitive taxes, we have strong policies and strong financial management.

What is the public finance initiative?

Mayor Bonnie Crombie, The City of Mississauga, Ontario, Canada:

Climate change is very real. What we’re seeing is that the hundred year storm is coming more frequently sometimes as often as every four years. Many of our residents had been flooded a number of times; 2009 with the flooding, 2013 with the torrential storms. Many of them aren’t able to obtain flood insurance. So the city had to act and take action.

Gary:

So to summarise, our problem was the underfunding of our storm water system. This had been caused by additional rain fall, through climate change and through greater urbanisation locally, two global issues really. Our solution was to take the service off of the property tax and introduce a user charge based on hard surface. And this meant the resident and the commercial base were paying a more equitable share based on who was contributing to the problem.

How did this initiative provide immediate value for citizens?

Bonnie:

Well the storm water charge has made a real difference in the delivery of public services. It has allowed to plan and to finance. Both are to maintain our underground infrastructure and also to build new public infrastructure. This is a dedicated fund that allows us to protect our homes, our residences and our businesses. And through dedicated funding the first year, we raised 40m $ and it assisted us with building a storm water management pond.

Gary:

So our citizens know that flooding is real but they also now know that they’ve got a very real solution to mitigating those risks and I think in the public sector environment I think that’s a great example of providing value for money for our citizens.

What would you like to say to other financial professionals implementing PFM reform around the world?

Gary:

What I would say to all the financial professionals who are involved in public financial management reform is that trust is critical in any reforms. Without trust, it’s a long road to change.