This summer, after New York City Mayor Rudolph Giuliani had pushed his austere budget through the city council, he might have been expecting kind words from the head of the board which monitors city spending.

He didn't get them.

Instead, Allen J. Proctor '74, executive director of the New York State Financial Control Board and an advocate of conservative spending, gave a frank assessment of the problems of the budget. In his opinion, it contained millions of dollars in "risky assumptions."

"You betcha there are a lot of risks," Proctor told the Newsday newspaper. "The test will be whether they can manage their way through them."

Yesterday, Harvard announced that it had hired Proctor to give the University the same brand of frank, pull-no-punches financial advice he routinely offered New York City.

Proctor, who had left the Big Apple just this summer to become a lecturer at the Kennedy School, will give up that job and take office as the new vice president for finance on November 1.

"He was extremely bright and very innovative," said Jeffrey L. Sommer, Proctor's deputy and now the acting executive director of the control board. "He had a way of bringing out the best in people and allowing them the freedom of coming up with new ideas and reaching a consensus."

Proctor is the product of New York City's complex web of politics and finances. Inside it, he reached prominence as an economic killjoy, bringing rosy political assessments back down to firm, financial earth.

Harvard Years

At the College, Proctor, a native of Beaver Dam, Wisconsin, lived in Winthrop House and was a very serious economics student.

In his spare time, he played percussion for the Harvard-Radcliffe Orchestra and the Bach Society Orchestra. He also worked as a research assistant to Gund Professor of Economics and Business Administration Richard E. Caves.

"He's one of the few students I can remember having worked with that wasn't sure whether he wanted to be a professional economist or a musician," Caves recalled yesterday.

After Harvard, Proctor returned home and earned his Ph.D in international trade and finance at the University of Wisconsin at Madison.

He then took a job at the Federal Reserve, where the young economist quickly gained a reputation for professionalism and a serious manner in his analysis.

"He always had high standards and was demanding," said Paul B. Bennett, senior vice president at the Federal Reserve Bank of New York, where Proctor served as the chief of the regional economics staff from 1985 to 1986.

Mark A. Willis, president of Chase Manhattan Community Development and former colleague, said yesterday that even in those early days, Proctor was distinguished by a frank approach.