Want to reform government? Start with the Civil Service09 August 2012
Francis Maude chose the opening week of the Olympics, the ultimate global contest, to declare the end of Whitehall “hubris”. The British Civil Service has much to learn from other countries, according to the Cabinet Office Minister. And why would Britain not want to compare itself against best practice from other countries? After all, many gold medallists are coached by the best in the world who are not of their nationality.
New Zealand underwent a radical reform of the public sector nearly three decades ago, and Minister of Finance I knew it was crucial to secure a results-driven and accountable public sector. The NZ public sector performance management system broke sharply with the bureaucratic norm.
In the mid-Nineties, having visited NZ to see the reforms first hand, a previous UK Government famously produced a report on Civil Service reform entitled ‘Continuity and Change”.
Needless to say the status quo won hands down on that occasion with continuity being preferred to change. Twenty years later the case for change is overwhelming.
The UK Government faces the same urgent imperatives that New Zealand did. A crippling fiscal position; an inefficient and unaccountable public sector; and a bureaucracy incapable of innovation.
The public sector is such a big player, economically and socially, that no transformation programme can succeed without embracing civil service reform.
I learned that success in government relies on ensuring that the forces of productivity and innovation, so crucial to lift private sector performance, must equally be allowed to make themselves felt in the ranks of the Civil Service.
New Zealand, like the UK, used to be burdened by a typical bureaucracy . The system served its own ends, behaved in a wasteful and unaccountable fashion and there was a complete disconnect between resources and results.
Rather than succumb to the status quo and reform at the margins of what the bureaucracy was already doing, we transformed both the conduct of public finances and civil service employment.
This represented a radical departure from the old approach. No longer would policies be justified by how much they cost or the number of people that they employed. Now the test was how much good would the policy do.
To come up with a model for reform we turned New Zealand’s government on its head and looked to the classical ways in which business is done in the private sector.
A defined contract for services, accountability for performance, a strong matching of resources and results.
And so the public sector performance management system for which NZ has become renowned was instituted.
This required starting with a clear idea of what we wanted to achieve and what we thought the role of the government should be.
The next step was to organise services to achieve these priorities. Asking the old system to do new things would not have worked.
We introduced contracts between Ministers and the heads of government departments to focus them on our priorities. And to sharpen accountability we put these heads of departments onto fixed term contracts, rather than providing them with jobs for life. We then let these managers get on and manage their organisations.
We also radically changed the way the way we managed our budgets. We made departments account properly for their assets, so that they would value them better. We made them report their performance in a way that every citizen could understand. These changes were important in allowing us to monitor the performance of services, were central to holding heads of department to account and were crucial in the quest to do more with less in fiscally straightened circumstances.
Lest we be guilty of hubris ourselves let me stress that this regime over the decades has been the subject of continuous improvement.
The current prime minister launching the 2012 Better Public Services initiative in March, declared that by dint of the new results-driven focus he meant to see a public sector where people were accountable for achieving something, not just for managing a department or agency. In the quest for a more innovative and efficient public sector focused on delivery of specified goals, the PM acknowledged that this would mean giving public sector leaders more flexibility to operate in different ways.
It is hardly a surprise that the old guard – the unelected government with real staying power – are lining up to oppose reform. But their arguments are discredited by our experience in New Zealand.
In particular, some say that changes of this kind "politicise" the Civil Service, by giving ministers control over the appointment of civil servants. The risk (they say) is that appointments are no longer made on "merit". But this view is too defensive. Ministers want to implement their manifesto, on which their ambitions and electoral prospects depend. They will only want to put someone in charge who is up to the job.
The real crux of the matter is – why should civil servants have jobs for life? The real life “slumdog millionaire” from Mumbai, who wants to use his winnings to take India’s tough civil service exam so he can win a secure and prestigious lifetime job”, is so typical of the species and the problem. And why shouldn’t they be accountable for their performance? A recent poll for the in-house Civil Service newspaper shows that there’s actually support from two thirds of civil servants to strengthen the ability to sack poor performance – proof that good people want to work with good people.
David Cameron might think that Whitehall reform is down his list of priorities. In fact it is the necessary tool to reinvigorate his reform programme and his Government.
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