Day1 sp2 kpmg-future_state2030icgfm2014trevordavies_en

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Day1 sp2 kpmg-future_state2030icgfm2014trevordavies_en

  1. 1. Future State 2030: Preparing Governments to Meet the Challenges of Coming Global Megatrends May 19, 2014
  2. 2. A changing world
  3. 3. 3© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The global megatrends impacting governments into 2030 ■ Demographics ■ Rise of the individual ■ Enabling technology ■ Economic interconnectedness ■ Economic power shift ■ Public debt ■ Climate change ■ Resource stress ■ Urbanization
  4. 4. 4© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #1: Demographics The evidence of change
  5. 5. 5© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #2: The rise of the individual The evidence of change
  6. 6. 6© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #3: Enabling technology The evidence of change
  7. 7. 7© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #4: Climate change The evidence of change
  8. 8. 8© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #5: Resource stress The evidence of change
  9. 9. 9© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #6: Urbanization The evidence of change
  10. 10. 10© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #7: Economic interconnectedness The evidence of change
  11. 11. 11© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #8: Economic power shift FACT:FACT:FACT:FACT: The evidence of change
  12. 12. 12© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Global megatrend #9: Public debt The evidence of change
  13. 13. 13© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Understanding interconnectedness Demographics Resource Stress Climate change
  14. 14. The consequences of megatrends on Public Financial Management
  15. 15. 15© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The consequences of megatrends on Public Financial Management: Changes – Individuals ■ Cashflow implications ■ Budget deficits ■ Tax revenues ■ Investments in education and youth programs Key Implications for PFM ■ Inflation control ■ Savings vs. consumer spending policies ■ Transparent governance ■ Investment in and use of social media Key Implications for PFM ■ Data accuracy ■ Data integrity and security ■ Be prepared for the answers that might differ from public opinion or political direction Key Implications for PFM Demographics Riseof theindividual Enablingtechnology
  16. 16. 16© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The consequences of megatrends on Public Financial Management: Changes – Global Economy ■ Infrastructure protection and integrity ■ Resource scarcity ■ Pressure on natural resources ■ Political influences ■ Public opinion pressures Key Implications for PFM ■ Rule of law pressures ■ Internal and regional micro-conflicts ■ Regional trade influences and impact ■ Population flow and distribution ■ Economic distribution Key Implications for PFM ■ Infrastructure deficits ■ Impact on productivity, both urban and rural ■ Prioritization of investments in infrastructure and social programs Key Implications for PFM Resourcestress ClimateChange Urbanization
  17. 17. 17© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The consequences of megatrends on Public Financial Management: Changes – Physical Environment ■ Initiatives to attract FDI ■ Trade policies ■ Tax regime ■ Governance and regulatory oversight of various sectors, e.g. financial services Key Implications for PFM ■ Ability to raise public debt ■ Country rating ■ Management of key metrics such as inflation, public debt levels and fiscal reserves Key Implications for PFM ■ Know your ‘markets’ and where expansion can occur ■ International trade agreements ■ Double tax treaties ■ Use of technology to quickly modernize and attract investment ■ Understanding future basis of economic drivers, e.g. more services driven Key Implications for PFM Economic interconnectedness Economic powershift Public debt
  18. 18. Possible responses to the megatrends
  19. 19. 19© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The tools available to governments When looking at what governments may need to change, they may choose from: When looking at how governments may need to change, they may choose from: Policy Regulation Programs SkillsStructureStrategies
  20. 20. 20© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. What we found How some governments need to change? Strategies Structures Skills
  21. 21. Thank You Website: www.kpmg.com/idas

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