CHAPTER 4

PUBLIC MANAGEMENT IN FLUX (Reforms)

SU DINH THANH SU DINH THANH

FIRST GENERATION OF REFORMS FIRST GENERATION OF REFORMS

i f fl bli ff f t

th 1980 d 1990 hi h b thi ki ht

There was a flowering of public sector reform efforts t Th in some English-speaking and Scandinavian countries i in the 1980s and 1990s which brought new thinking and processes into public services to make them more efficient and more responsive to clients. i ffi i li d t t t

FIRST GENERATION FIRST GENERATION

(cid:131) Objectives of the first generation of reforms: (cid:131) Obj t

f th fi

ti

ti

f

f

issues to policy objectives, iss es to polic objecti es

(cid:131) Many of these improvements are a matter of technical or operating efficiency more outputs produced with fewer operating efficiency – more outputs produced with fewer inputs. . . . But as important as it is, efficiency in producing outputs is not the whole of public management. It also is essential that government has the capacity to achieve its larger political and strategic objectives. . . . It will have to to move from management to mo e from management fostering outcomes. (cid:131) A feature of these reforms was that they were directed at A feature of these reforms was that they were directed at ‘managerializing’ the public sector.

Source: Schick (1996, p. 87)

FIRST GENERATION FIRST GENERATION

i t ffi i (cid:131) Management efficiency as main result: lt

M (cid:131) Beyond the impressionistic evidence, there is strong reason to believe that restructuring public management reason to believe that restructuring public management has brought sizeable efficiency gains that are reflected in lower staffing levels and reductions in real operating in lower staffing levels and reductions in real operating expenditures.

Source: Schick (1997, p. 10) Source: Schick (1997 p 10)

FIRST GENERATION FIRST GENERATION

d ti

ffi i

f

t

t

f t (cid:131) Public sector reforms of New Zealand has been Z l d h f N b

better services better services

(cid:131) Improved financial accountability (cid:131) Improved overall fiscal control Improved overall fiscal control

P bli strengths: (cid:131) More efficient production of outputs t M (cid:131) A more responsive, innovative public sector delivering

FIRST GENERATION FIRST GENERATION

(cid:131) But there are some weaknesses : k

B t th (cid:131) The alignment of outputs with outcomes (cid:131) Weakness in the link between government strategy th li k b t t t t

(cid:131) The potential for conflict between purchase and d fli t b t ti l f h t

W k i and budget spending Th ownership interests i P bl f t

(cid:131) Problems in contracting for outputs ti t t (cid:131) Unforeseen consequences of the new regime (cid:131) Uneven performance of departments and agencies f d U d f t i t

FIRST GENERATION FIRST GENERATION

t ( f ti ith th

i t l ti liti th f

t I iti ti i M l d i t

(cid:131) The first generation of reformers (with the notable t bl f Th fi exception of New Zealand) tended to treat the public management process in isolation from the political l i policy process and the legislative process. (cid:131) The Strategic Management Initiative in Ireland sought ht I Th St to bring about major management change in the public sector, without addressing the role and accountability d t bilit th of ministers in strategy and resource use. (cid:131) It did not achieve its original strategic goals . i

ith t dd l t i

It did i i hi it t t l t l

COUNTRIES RESPOND DIFFERENTLY TO CHANGING PUBLIC POLICY CONTEXTS

(unemployment, social

The pressures for change have been influenced by six major variables: (cid:131) The state of the economy (fiscal crisis) (cid:131) Industrial relations insurance)

(cid:131) Attitude to the role of government (cid:131) Differing administrative cultures (cid:131) Differing national priorities (cid:131) Differing constitutional arrangements

THE NEW REFORM THE NEW REFORM

government and to

The role of government should be adaptive – to monitor changes in the international and domestic environment actions adapt accordingly => The movement to ‘performance’ and attention to citizens as ‘customers’ introduces major pressures towards change.

THE NEW REFORM THE NEW REFORM

i

i

t

f

bli

i t

l d i

The main points involved in the public management reforms Th th including: (cid:131) A strategic approach A strategic approach (cid:131) Management not administration (cid:131) A focus on results (cid:131) Improved financial management (cid:131) Flexibility in staffing (cid:131) Flexibility in organization (cid:131) Fle ibilit in organi ation (cid:131) A shift to greater competition (cid:131) The new contractualism The new contractualism (cid:131) A stress on private sector styles of management practice (cid:131) Relationships with politicians (cid:131) Relationships with the public (cid:131) Separation of purchaser and provider

THE NEW REFORM THE NEW REFORM

(cid:132) Traditional public administration was based on two theories, the theory of bureaucracy (Max Weber) and the theory of separation between politicians and administrators. separation between politicians and administrators

(cid:132) There are also two main theoretical bases to new public management These are economics and private management management. These are economics and private management. (cid:132) The OECD argues the old paradigm of public sector management ‘is replaced by a new paradigm which attempts to combine modern management practices with the logic of economics, while still retaining core public service values’ (OECD, 1998, p. 5).