managing under austerity, delivering under pressure

238 Pages·2015·2.49 MB·English

by  John Wanna

MANAGING UNDER AUSTERITY,
DELIVERING UNDER PRESSURE
Performance and Productivity in Public Service

MANAGING UNDER AUSTERITY,
DELIVERING UNDER PRESSURE
Performance and Productivity in Public Service
Edited by John Wanna, Hsu-Ann Lee and Sophie Yates
Published by ANU Press
The Australian National University
Acton ACT 2601, Australia
Email: [email protected]
This title is also available online at press.anu.edu.au
National Library of Australia Cataloguing-in-Publication entry
Title: Managing under austerity, delivering under pressure :
performance and productivity in public
service / editors John Wanna, Hsu-Ann
Lee, Sophie Yates.
ISBN: 9781925022667 (paperback) 9781925022674 (ebook)
Subjects: Public administration--Australia.
Public administration--New Zealand.
Finance, Public--Australia.
Finance, Public--New Zealand.
Civil service--Labor productivity--Australia.
Civil service--Labor productivity--New Zealand.
Australia--Appropriations and expenditures.
New Zealand--Appropriations and expenditures.
Other Creators/Contributors:
Wanna, John, editor.
Lee, Hsu-Ann, editor.
Yates, Sophie, editor.
Dewey Number: 351.994
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system
or transmitted in any form or by any means, electronic, mechanical, photocopying or otherwise,
without the prior permission of the publisher.
Cover design and layout by ANU Press
Printed by Griffin Press
This edition © 2015 ANU Press
CONTENTS
List of figures and tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
Contributors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi
PART ONE: THE IMPERATIVE TO IMPROVE PRODUCTIVITY AND
PERFORMANCE
1 . Delivering under pressure: Public service, productivity and performance . . . 3
John Wanna
2 . Getting leaner, smarter and more effective: Opportunities and
constraints for governments under austerity . . . . . . . . . . . . . . . . . . . . . . . 13
Doug McTaggart
3 . Public sector productivity: Puzzles, conundrums, dilemmas
and their solutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Patrick Dunleavy
4 . Measuring and improving government performance: Learning
from recent US experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Shelley H. Metzenbaum
5 . Performance management: Creating high performance,
not high anxiety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Deborah Blackman, Damian West, Janine O’Flynn, Fiona Buick
and Michael O’Donnell
6 . Reviewing performance to improve delivery: Key insights from
two auditors‑general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Andrew Greaves and Peter Achterstraat
PART TWO: THE NEED FOR GOVERNMENTS TO INNOVATE
7 . Innovation in the public sector: Beyond the rhetoric to a genuine
‘learning culture’ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
Andrew Podger
8 . Unleashing change in government . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
Steven J. Kelman
9 . Eight‑and‑a‑half propositions to stimulate frugal innovation
in public services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
Jean Hartley
10 . Strategic advice to the public service facing austerity . . . . . . . . . . . . . . . 157
Paul McClintock
11 . Can ‘nudging’ change behaviour? Using ‘behavioural insights’
to improve program redesign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
David Halpern and Rory Gallagher
PART THREE: COLLABORATION WITH THE PRIVATE AND THIRD
SECTORS
12 . Frugal innovation: Beyond the concepts of ‘public’ and ‘private’ . . . . . . . 183
Gary Sturgess
13 . The road to genuine partnerships with the third sector:
Are we there yet? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
Peter Shergold
14 . Developing social benefit bonds in Australia: The NSW Family
and Community Services experience . . . . . . . . . . . . . . . . . . . . . . . . . . . 205
Simone Walker
15 . Situating mutuals in the Australian public sector context . . . . . . . . . . . . . 215
Les Hems
LIST OF FIGURES AND TABLES
Figure 3.1. Total factor productivity in the UK Customs regulation
on trade, 1997 to 2008 ..................................... 30
Figure 3.2. Labour and intermediate inputs productivity, UK taxation,
1997 to 2008, using tax collection activity data .................. 31
Figure 3.3. The ratio of the deflated amount of tax collected to
labour and intermediate outputs for HMRC and predecessor
departments, 1997 to 2008 .................................. 32
Figure 3.4. Total factor productivity in UK social security, 1997 to 2008 ... 33
Figure 3.5. The changing pattern of the WAP’s customer contacts,
2005 to 2008 ............................................. 34
Figure 3.6. Productivity versus lagged ICT spending across UK welfare,
tax and customs, 1999 to 2008 ............................... 36
Figure 3.7. Productivity versus lagged construction PFI spending as
proxy variable for major reorganisation; UK welfare, tax and customs,
1999 to 2008 ............................................. 37
Figure 3.8. Productivity versus lagged consulting spending; UK welfare,
tax and customs, 1999 to 2008 ............................... 38
Figure 5.1. Responses on performance feedback ...................... 81
Figure 5.2. Responses on performance feedback ...................... 82
Figure 5.3. State of the Service Report findings regarding performance
management ............................................. 83
Figure 5.4. Management responses to time availability for performance
management ............................................. 84
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MANAGING UNDER AUSTERITy, DELIvERING UNDER PRESSURE
Figure 5.5. Achieving high performance outcomes through four levels
of performance ........................................... 86
Figure 5.6. A framework for high performance ....................... 93
Figure 6.1. Distribution of amounts billed, Queensland public
hospitals, 2011–12 ........................................108
Figure 6.2. Category 2 elective surgery, Queensland public hospitals ......109
Figure 6.3. In-patient billing by system, Queensland public hospitals .....110
Figure 6.4. Total and average overtime paid to SMOs, Queensland
public hospitals, 2003–12 ...................................111
Figure 11.1. Percentage of taxpayers paying outstanding taxes after
23 days, by type of tax letter received .........................167
Figure 11.2. Four basic stages for most projects undertaken by the
Behavioural Insights Team ..................................169
Figure 11.3. The four EAST principles for policy development ..........173
Figure 12.1. Danish cartoon about Falck ............................184
Table 12.1. Serco Welfare to Work model ...........................192
Figure 14.1. Number of children in out-of-home care in NSW,
2002 and 2013 ...........................................206
Figure 14.2. What is a social benefit bond?. . . . . . . . . . . . . . . . . . . . . . . . . .207
viii
FOREWORD
This volume had its genesis in an Australia and New Zealand School of
Government (ANZSOG) conference titled ‘Delivering under Pressure’. And that
is certainly what many public sector managers feel they are doing these days.
In a short space of time, many have gone from one extreme to another: from
having to expend vast sums quickly on infrastructural and other programs to
stem contagion from the Global Financial Crisis—and, in Australia, devising
large-scale social expenditure programs leveraged by the Mining Boom—to
having to do their bit to reduce resulting deficits and debt. In Australia at least,
this ongoing challenge appears to have been made harder politically by public
attitudes and expectations conditioned by the earlier largesse.
While only recently embraced, it would seem that public sector ‘austerity’ is
here to stay. The term has been used by some to denote overreaction to budgetary
pressure. But spending remains historically high, and in Australia (New Zealand
has done much better) the fiscal problems are big and will not be resolved
quickly. It is also clear that the magnitude of the necessary correction needs
something better than mere trimming of budgets and time-honoured, across-
the-board efficiency dividends. There is a growing recognition that governments
must think more strategically about their roles in society and, in particular,
how much they should be doing and funding at taxpayers’ expense—on the
‘what’ question as well as the ‘how’. Doing more with less, and doing only what
the public sector can do best, have become dual imperatives—though arguably
they should have been so all along.
‘Productivity’ as an operational concept is most commonly associated with the
private sector, although it is just as relevant to the public sector. But the conduits
for productivity gains—innovation within organisations, and the ascendancy of
more productive or valued activities over others—do not come easily within
the public sector, not least because of the more muted incentive systems that
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MANAGING UNDER AUSTERITy, DELIvERING UNDER PRESSURE
are obtained there. Moreover, measuring any gains is inherently problematic
for services that are delivered in non-market settings and motivated by ‘public
value’.
How do we best foster public sector innovation in the absence of competitive
pressure? How do we decide which activities are most valuable, or which are
better performed by or through other agents? And how do we know if we are
performing well according to the public value test? These are all important
questions for which there is no settled ‘theory’ and for which answers are still
emerging through observed practice.
The issues raised and the experiences related in this volume provide useful
guidance. If I were to summarise the key insights for me, they would be:
• Churchill’s maxim, ‘never waste a good crisis’, with the current need to
spend less being seized as an opportunity to actually serve the public better.
• ‘Frugal innovation’—changes in programs and processes that pay as much
attention to the costs to the taxpayer-cum-citizen as to the benefits.
• The value of experimentation, of ‘having a go’ and, even more importantly,
learning from the experience.
• Harnessing the advantages of the private and, especially, ‘third’ sectors, in
pursuing public purposes.
• The importance of measurement to the pursuit of cost-effective management
of scarce public resources.
• Promoting public understanding of both the ‘why?’ as well as the ‘what?’
questions in order to successfully implement reform initiatives.
ANZSOG is committed to assisting governments in all these areas. Its programs
of teaching, research and discussion for executives combine the best of
academia with the in-depth experience of top practitioners. For, in the end,
how successfully the public sector ‘delivers under pressure’ depends on the
capability and motivation of its leadership.
Professor Gary Banks AO
Chief Executive and Dean, ANZSOG
29 June 2015
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