Performance Audits and Management Control Systems in Italian Local Governments: Do They Have a Future?

Abstract: the paper deals with the introduction of management control and performance audit in Italian local governments. The first part provides a concise description of the local governments’ reform. As in other countries where performance oriented reforms have been adopted, particular emphasis was given to efficiency and effectiveness. In order to control the most important «value drivers», legislators recommended the adoption of tools and procedures for the measurement of the performance on costs, quality and quantity of services delivered. The expected impact of the reform was: improved accountability, rationalization of public spending, and a higher outcome/costs ratio. More than a decade since the reform was adopted, it is still difficult to recognize improvements in terms of effective performance measurement and accountability. According to recent surveys, only a few local govermentss have developed a first stage of managerial control system and performance audit. The «cause and effect» relation between the managerial approach of the reform act and an improvement in performance has not worked properly. Is this due to “technical difficulties” in the implementation of managerial tools within the public context, or is the assumed relationship between control, audit and performance simply overestimated by the reform? The paper argues that only some of the factors that hinder the effectiveness of managerial control system in this context depend on technical problems, while others are due to the reform itself.