Performance and Accountability: Budget Reform in New Zealand

Since 1984, New Zealand has made major changes in public sector management. This article describes the perceived problems with the previous New Zealand system and discusses the reforms designed to address these problems. The changes attempt to increase efficiency by: (1) separating commercial functions from other government operations; (2) strengthening lines of ministerial and executive accountability; and (3) designing budget and financial management systems to improve measurement of public sector performance. This last reform includes shifting from an input to an output-based system, changing from cash to accrual accounting, and creating different forms of appropriations for different types of government activities. While it is too early to assess whether the reforms are successful, we note potential problems.     

With the Benefit of Foresight and a Little Help from Hindsight

This article is about New Zealand's recent experience in public sector reform. New Zealand became seized with economic rationalism about the same time as Australia did but at the national level we went faster and farther than Australia towards the creation of a commercial culture in the public sector. Here I discuss what might be learned from what has happened in New Zealand.     

Performance reporting for accountability purposes:: Lessons,issues, future

This article addresses the status and directions for performance reporting in the New Zealand public sector from the perspective of the Office of the Auditor General (OAG). It outlines the role of the Audit Office, provides definitions of accountability, and projects the dimensions of a new accountability. The authors assess challenges to performance reporting and accountability, the history of reporting performance accountability in New Zealand, an Audit Office perspective on accountability to Parliament, lessons learned from reform, some issues outstanding, and future development in terms of how the public sector in New Zealand should improve reporting on non-financial performance.     

Balanced Scorecard Use in New Zealand Government Departments and Crown Entities

While the concept of a balanced scorecard (BSC) has been extensively documented, there is limited research on the application of the balanced scorecard in a public sector environment and in New Zealand. This article examines how the BSC is being used as a performance management system, a strategic management system and to discharge external reporting obligations in three New Zealand public sector organisations. The findings are relevant to both the academic community and managers by highlighting how the BSC has been adapted to reflect the unique characteristics of public sector organisations.     

Accountability or Countability? Performance Measurement in the New Zealand Public Service, 1992–2002

This article examines how output classes and performance indicators have changed between 1992 and 2002 in five selected departments of the New Zealand Public Service. Process, output and largely artificial service quality performance measures have crowded out outcome, efficiency and effectiveness indicators, across the board. Both output classes and performance indicators have been highly labile, though the reasons for this remain speculative in the meantime. The New Zealand state sector is currently implementing a ‘managing for outcomes’ strategy, intended to overcome too strong a preoccupation with the production of outputs. However, because output classes remain the key feature of the Public Finance Act 1989 the means of ensuring and demonstrating policy effectiveness must be more broadly based than a reliance on the countability of organisational output classes and performance measures.     

From Uniformity to Diversity? Reinventing Public Sector Industrial Relations in New Zealand

Since 1988 industrial relations in New Zealand's public sector have changed significantly. This paper discusses the changing roles of the State Services Commission and chief executives in bargaining with public sector employees, and how these changing roles have affected union representation and wage rates. While the Employment Contracts Act, 1991 resulted in changes to bargaining, generally its effect was minimal in the public sector with respect to bargaining outcomes. However, one of the more significant changes as a result of the Employment Contracts Act has been a move to direct employer — employee negotiations. Bargaining in New Zealand's public sector has moved, in the last nine years, from uniformity to diversity, but to what extent?     

Service Delivery: The Audit Dimension

Reporting of performance information on public sector services has increased substantially in recent years. The audit of such information, however, is still relatively uncommon. In 1989 the Audit Office in New Zealand was confronted with a legislative requirement to audit Statements of Service Performance (SSPs). This paper backgrounds New Zealand's shift in emphasis from program effectiveness audits to the audit of non-financial performance information, describes the development of audit methodology in this area and identifies lessons learned.     

The Grass is Greener,But Why? Evidence of Employees’ Perceived Sector Mismatch from the US,New Zealand,and Taiwan

ABSTRACT

To answer the question of who wants to work for the government, scholars have relied on a few approaches, including sector preference, sector-based comparison of work motives, and sector-switching patterns of job mobility. The present study offers a related but distinct approach: perceived sector mismatch. The attractiveness of public sector jobs differs greatly across countries; thus, in order to present a more comprehensive study, we examine data from the U.S., New Zealand, and Taiwan, where attitudes towards public sector jobs differ significantly as a result of different public service laws and traditions. Across all three samples, we find that, among private sector employees, the preference for a public service job is related to socio-economic disadvantage. Among public sector workers, reasons for perceived sector mismatch vary, but often suggesting job dissatisfaction in current public sector jobs, rather than perceived advantages of the private sector (including compensation). These findings are followed by theoretical and practical implications from this comparative study.     

New Zealand experience with public management reform—or why the grass is always greener on the other side of the fence☆

This article provides an analysis of how New Zealand has achieved the successes made to date, issues and problems yet to be resolved, and directions on how to address current shortcomings in public managment reform of the New Zealand model. Four issue pillars provide the framework for the analysis: Political—problems that are inherent to the political arena under a range of public management regimes; Incompleteness—problems that reflect that the system is incomplete in some areas, but that do not suggest inherent difficulties; Implementation—problems to do with the way the system has been implemented; Inherent—problems inherent in the New Zealand regime, but not necessarily in other systems. The overall conclusion drawn is that relatively few of the problems are inherent in the New Zealand model and that most problems fall under the first of the four issue pillars: politics. The author concludes that there is much to be done—but that it can be done within the framework of the Public Finance Act and the State Sector Act by changing how the system is operated.     

Reforming the public sector for leaner government and improved performance: The New Zealand experience

Over the 10 year period from 1984 to 1994 New Zealand has gone through an intense period of restructuring, both of the public sector and of the wider economy. In the process New Zealand has been transformed from a highly protected and regulated economy with a range of intrusive and expensive interventions, to an open and deregulated economy with an efficient and leaned down public sector. The article presents the “New Zealand experience” in restructuring, not necessarily as an example to be copied but as a benchmark to be used in examining the most appropriate restructuring to apply in other circumstances. The stages in the reform are described and the three key success factors set out. One of the key factors is the establishment of a set of clear principles which are then applied with determination. The principles developed in the New Zealand context are set out. The article examines the restructuring of the science sector in New Zealand as one case study; in part because of the author's personal involvement but also because it is a particularly complete example. Areas where work remains to be done are identified including the reforms in education and health and the need for collective action across government. Finally lessons to emerge from the New Zealand experience are discussed. These include especially putting time into fully understanding market characteristics before a market oriented reform is started, carrying reforms through to their conclusion rather than stopping partway, and establishing clear principles to guide the reform process.     

Improving Performance in New Zealand's Public Corporations: The Effect of Governance Practices

This article examines whether the corporate governance practices recommended by the New Zealand Securities Commission (NZSC) in 2004 have affected the financial performance of public sector corporate entities in New Zealand. The findings indicate that these entities have universally adopted the Securities Commission recommendations by establishing subcommittees for audit and remuneration, and having a majority of independent directors on the boards. The results show that leverage has a statistically significant positive effect on all performance measures. Both the Remuneration Committee and dividend payout have positive effects on performance when measured by sales to total assets. Board size and an Audit Committee have a positive effect on reducing agency cost. Results also show that entity risk and industry type also have a positive effect on performance and agency cost reduction. Entity size has a consistent negative effect across all performance measures.     

Effectiveness: the next frontier in New Zealand

Central agencies face a critical test on how to approach the resolution of issues and problems related to improving the New Zealand public sector management systems from the author’s perspective. A decade has passed since the legislative changes were approved that initiated major financial management reform, and much of the initial reform energy has faded. It is time to assess what has and has not been achieved, and to search for ways to continue to move forward. There is a sense of anticipation, as well as some apprehension, across the New Zealand public sector, particularly in light of the election of a new Government. As New Zealand moves into a new phase of reform, one of the key challenges is to take advantage of what has already been achieved. New Zealand has one of the world’s leading public sector management systems, and should take advantage of that foundation. The key issue focused on in this article is effectiveness. A critical part of raising effectiveness is enhancing information. Better information is needed on outcomes, and it should be packaged in more accessible and relevant ways. More disciplined evaluation of the effectiveness of what is done is necessary. Systems that encourage public servants to raise their horizons should be improved or put in place. Managers who understand what they are doing and why are critical to reform success. Purchase agreements—or output agreements—will play a pivotal role, but they need to be improved. A fresh approach to output specification to better accommodate the range of output relationships that exist is required. Central agencies can facilitate customization of output specifications by being clearer about the basic output framework, and more flexible about how that framework is applied. Outcome measures should be refined and used along with outputs where feasible. Better ways must be found for managing problems of inter-agency coordination. Technology offers a new set of tools, but IT facilitates rather than creates effective relationships. Other coordination mechanisms that help agencies to communicate and to make trade-offs must evolve. New Zealand can move into a new phase of building a “world’s best” public sector. The public sector has an appetite for action at the moment, and a willingness to debate the issues. How this potential will be used is, to a great extent, the critical issue faced by the new Government.     

New public management reform in New Zealand: The collective strategy phase

This paper examines the New Public Management movement in New Zealand. Specifically the focus is on the financial management of central government departments and the shift in emphasis from management in the public sector to management of the public sector, that is, from defining management in terms of where it takes place to defining it in terms of the nature and outcome of the task.     

Public Sector Reform Knowledge Production: Validation and Evidence as 'Agreement'

In this article I draw on public sector reform knowledge in the United States, New Zealand and Australia. I argue that we, as practitioners, do not need to immerse ourselves in academic debates about 'positivism' or 'post-positivism'. These are frameworks for examining knowledge capable of validation. Instead, we are now engaged in using diverse forms of knowledge to spread the word on what works and does not work to deliver outcomes. Such knowledge is not above reproach; it is not acceptable merely because it exists but nor is it unacceptable because it cannot be rigorously validated in a positivist way.     

Traditions and Public Sector Reform: Comparing Britain and Denmark

A governmental tradition is a set of beliefs about the institutions and history of government. In this article I argue the Anglo-Saxon governmental tradition interprets public sector reform differently to the Rechtsstaat , participation tradition of Denmark, leading to different aims, measures and outcomes. In the Introduction, I define NPM arguing that is has become everything and is, therefore a meaningless term. I identify six dimensions to public sector reform: privatization, marketization, corporate management, regulation, decentralization and political control. In section 2, I describe the six dimensions of public sector reform in Britain and Denmark. In section 3, I explain the idea of a governmental tradition and argue the idea is essential to understanding the differences between Britain and Denmark. In section 4, I compare British and Danish governmental traditions, arguing the key differences lie in beliefs about the constitution, bureaucracy and state-civil society relations. Finally, I provide a summary explanation of the differences and argue that traditions not only shape the aims, measures and outcomes of public sector reform but also lead to different interpretations of reform and its dilemmas. In Britain, the key dilemma concerns central steering capacity. In Denmark, the main dilemma is democratic accountability.     

The Use of Contracting in the Public Sector—Recent New Zealand Experience

This research note examines the expanding use of contracting within the public sector in New Zealand. The term 'contracting' is interpreted broadly to include both external contracting (ie outsourcing) as well as the use of more explicit or formal 'contracts' within and between public sector organisations. No attention is given here to the separate, albeit related, processes of corporatisation, commercialisation and full privatisation (ie asset sales and the termination of public funding as well as provision). The empirical data, although limited, suggest that the recent increase in contracting in New Zealand has brought significant gains in terms of fiscal savings, productive efficiency, consumer choice and managerial accountability. Recent trends, however, have also posed some important policy issues, among them the limits to contracting out and the potential dangers associated with 'hollow' government.     

Performance Measurement in the Public Sector in England: Searching for the Golden Thread

Despite the significant volume of studies on public sector performance measurement, a paucity of empirical research describes in detail the systems and processes used at different levels of government to measure and manage performance. This study focuses on the experience of Public Service Agreements in the public sector in England. In particular, the impact of a centralized, performance measurement‐driven approach on public service delivery is analyzed using case studies in a health care and a police organization. Despite efforts to introduce a “golden thread” to link different levels of the public sector hierarchy, in both cases, there was relatively low consistency in terms of performance indicators, targets, and priorities. Significant implications are evident for the design and role of performance targets and indicators, for the possibility to align frameworks at different levels of the public sector, and for the importance of feedback loops in measurement systems.     

“新公共管理运动”的困境与转型——新西兰公共部门改革的反思及参鉴

新西兰公共部门改革是"新公共管理运动"的先锋,作为"改革实验室"和"政策创新者",因其彻底性、持续性及成效性被誉为"改革的典范"。然而近年来,西方公共管理学界提出了若干质疑,甚至认为"新公共管理运动已经死亡"。本文在考察新西兰公共部门改革实践的基础上,对实践模式的局限性及时代转换的压力两方面的批判性反思进行了梳理和分析:其"公平"与"公共"价值已经失落?是"经济学帝国"的扩张?还是"新泰勒主义"的表现?亦或是随着改革主题的衰落,数字时代治理的来临。对这一改革的实践发掘和理论反思对于当前我国政府职能转换与行政改革具有重要的参鉴价值:首先,推进改革的政府需要具备必要的能力基础;公共部门改革的核心命题是转变理念,优化政府职能,提高政府的效率和效能;而改革能否顺利推进,取决于广大民众和政府之间的深入互动;此外,改革需要尊重地方政府的主动性,充分发挥其作用。     

After the Reforms: Some Patterns of Attitudinal Change among Senior Public Servants in Canberra and Wellington

Major public sector changes in Australia and New Zealand over the past decade have produced significant shifts in the beliefs, training and outlook of public servants. Using data from surveys in 1986–87 and 1994–95, this article tracks key attitudinal changes. It finds more marked change in Wellington than in Canberra, perhaps reflecting the more radical public sector agenda on that side of the Tasman