Groningen is an innovative municipality with a clear objective to deliver high quality public services, to be more flexible, efficient, and transparent towards the city’s inhabitants. In order to deliver on these promises, the municipality must manage an annual budget which is divided between the different departments. The current budgeting system creates a twofold challenge.
"This digital transformation ensures that all transactions and mutations in the budgets become immutable and indisputable"
Firstly, Groningen wants to achieve more with less resources, but currently when a budget needs to be reallocated from one department to another, a bureaucratic process prevents the organisation from being flexible and efficient. Furthermore, there is no insight into unspent budgets, whilst surplus within a program or department should be made available again for the collective budget. Secondly, there is a strong desire to be more transparent towards the citizens of Groningen. By giving them the opportunity to check and assess the execution of policy and financial transactions, they hope to become more reliable. Tooling that helps the municipality to make that data fully transparent and trustworthy is currently unavailable.
We created a software solution through which budgets are not directly allocated to any particular department. This increases flexibility to reallocate budget. Departments still need to hand in a forecast, but don’t ‘own’ the budget anymore. Costs are directly deducted from the overall budget and are compared in real-time with the forecast. This creates the necessary overview of under- and overspend for all departments. Furthermore, we label specific budgets intended for predefined services i.e. waste disposal tax. All these transactions are registered in a distributed ledger. This digital transformation ensures that all transactions and mutations in the budgets become immutable and indisputable.