Politics of Risk-Taking: Welfare State Reform in Advanced Democracies,by Barbara Vis

This article considers the impacts on the public regulation of private business of three key transformations in public management: “towards more targeting of resources” (through more risk-based regulation); “towards a stronger service ethos” (through more customer-centricity); and “towards increased integration” (through more joined-up regulatory organization). Empirical evidence is presented from a program of research focusing on local authority regulation of the businesses sector in England and Wales. The article concludes by reflecting on how such transformations, which are of wide international significance, might be viewed, particularly from a public interest perspective.     

Administrative and regulatory reform of Korea in a time of national crisis

Korea has undertaken all-out efforts to reform its economy and government to be ready for the new era of global competition and overcome the current economic crisis. Public sector reform seeks to liberalize the market economy by removing unnecessary government interventions in the private sector. The realization of the “four S's” - a small but strong government with the smarts to manage future uncertainties and a sensitivity to the people's needs - is the ultimate vision for the public sector reform. Regulatory reform calls for at least fifty percent of all government regulations eliminated by the end of 1998 and the rest of the regulations improved based on a set of rational principles. One key aspect of regulatory reform is focused on removing barriers to foreign direct investment. Epochal changes in the public sector including governmental regulations are expected to bring Korea up to global standards for business competition and government performance.     

Regulation in an Episodic Policy-Making Environment: The Water Industry in England and Wales

This article describes and analyses the evolving regulatory game in the post-privatized water industry. It highlights a regulatory environment that is more complex than that which existed under public ownership, and an industry which is subject to heavier regulation in the private sector than it was in the public sector. There has been erosion of the strict public/private divide following privatization. The article highlights an episodic and seemingly incongruous policy-making environment that defies consistent characterization: sometimes private consensus is the main feature and sometimes it is public conflict. It also illustrates that while there are two broad-based constituencies of interest active in the water sector — cost and environmental — the composition of these coalitions mutates depending on the issue being considered. Indeed, there are occasions when core constituency participants 'defect' and join the 'opposing side'.     

MIXED SIGNALS? PUBLIC SECTOR CHANGE AND THE PROPER CONDUCT OF PUBLIC BUSINESS

What begun after the 1979 General Election as an exercise to reduce the public sector's size and cost developed during the 1980s into continuous change to its organization, functions and structure. Throughout this process it appeared that certain assumptions were made about the presence and continuity of standards of conduct, the proper conduct of public business and the sense of public service. Such assumptions appear to have been based on a belief that these standards were general throughout the public sector and would be maintained or adapted during change. Little attention was given to what comprises the standards, how they are perceived and implemented across the public sector and who monitors or polices them, particularly in times of change. Various aspects of the changes, from devolved management to privatization, have brought a number of new pressures and perspectives on the conduct of public business which have led to cases involving failure to follow established procedures, the lack of expertise, conflict of interest, mismanagement, and misconduct. Together various cases have raised questions about dysfunctional consequences of change, the signals given to officials in terms of how change affects their functions, and the implications for the continued adherence to and effectiveness of both standards of conduct and of the means and procedures whereby probity and standards of conduct are maintained.     

The Lost Legitimacy: Property, Business Power and the Constitution

After nearly a quarter of a century of business friendly government in Britain, the business community nevertheless finds itself more unpopular than for three decades and is increasingly beset by demands for regulation. The sources of its problems lie in the regulatory structures historically created for the business community. These structures have been unable to cope with regulation in the world of large-scale privatization, global economic competition and the demands of democratic politics for public accountability. Business is therefore struggling to create new sources of legitimacy.     

The Lost Legitimacy: Property,Business Power and the Constitution

After nearly a quarter of a century of business friendly government in Britain, the business community nevertheless finds itself more unpopular than for three decades and is increasingly beset by demands for regulation. The sources of its problems lie in the regulatory structures historically created for the business community. These structures have been unable to cope with regulation in the world of large‐scale privatization, global economic competition and the demands of democratic politics for public accountability. Business is therefore struggling to create new sources of legitimacy.     

Regulatory reform,property rights,and economic development

Overcoming tradeoffs between the social benefits of regulation and the economic benefits of development has never been easy in practice. This article examines the economic development consequences of state and local regulation by developing a framework that provides a theoretical basis for expecting regulatory costs to influence the amount and location of new development. After elaborating the theory, I identify two ways state and local governments may be able to pursue regulatory goals without creating disincentives for economic development. One approach is for state or local government to socialize costs of regulatory compliance through public expenditures or subsidies. A second, and more promising, approach is to pursue regulatory reform which lessens private sector transaction costs by reducing regulatory uncertainty. This framework is illustrated using two cases: state regulation of the chemical industry, and growth management regulation.     

SELF‐REGULATION WITHIN THE REGULATORY STATE: TOWARDS A NEW REGULATORY PARADIGM?

An emerging feature of the modern regulatory state in Britain and elsewhere is the promotion of self‐regulation. This paper examines the relationship between the state and self‐regulation in the context of the challenge of meeting public interest objectives. It draws on research on the policy and practice of self‐regulation in recent years in Britain. The paper argues that the institutions, processes and mechanisms of the modern regulatory state and the ‘better regulation’ agenda in Britain, notably those that aim to foster transparency and accountability, can assist in the achievement of public interest objectives in self‐regulatory schemes. We conclude that a ‘new regulatory paradigm’ can be put forward which involves a form of regulatory ‘subsidiarity’, whereby the achievement of regulatory outcomes can be delegated downwards to the regulated organizations and self‐regulatory bodies while being offset by increasing public regulatory oversight based on systems of accountability and transparency.     

Regulation and its modes: the European experience

There is a general trend in Europe, both at the national and Community level, toward greater specialization and institutionalization of regulatory functions. This essay presents three different but related sets of reasons that help to explain the rise of the regulatory state in Europe, and even why regulation seems to be becoming the new frontier of public policy and administration. A first set of reasons has to do with the failure of nationalization as a mode of regulation and the process of privatization, which have led to new regulatory bodies. The second set of factors, related to the increasing complexity and internationalization of the tasks facing policy makers, has led to new or stronger regulatory bodies at the Community level. The third set has to do with the role of the European Community as an independent “fourth branch of government” for the European nations. This latter trend has some problems, as the lack of transparency of the decision-making process. However, this problem can be solved. Moreover, the explanations for the rise of independent regulatory agencies echo many characteristic themes of the politics of efficiency, being recently rediscovered. The conviction that policy should be right, rather than the result of group struggle, leads to demands that policymakers should combine technical expertise and public deliberation to achive decisions that are substantively correct and politically legitimated.     

PERFORMANCE IN THE THIRD SECTOR: A MICRO-LEVEL FRAMEWORK AND SOME LESSONS FROM ISRAEL

Organizational performance is perhaps the most studied topic in management literature. For many years much attention has been given to understanding performance of the first (private/business) and second (public/administrative) sectors. Only recently have studies shown interest in the performance of the rapidly evolving third sector. However, most studies on the performance of Voluntary and Non-Profit Organizations (VNPOs) have so far adopted a distinctly macro-oriented perspective, overlooking micro-level viewpoints which may have special merit for a broader understanding of effectiveness and efficiency in these bodies. This paper provides an insight into this less studied dimension of performance analysis and tries to illuminate its advantages for VNPOs. The model applies existing knowledge from other fields such as organizational behavior and labor studies, and puts forward a theory that may prove useful for third-sector organizations struggling to improve results in a turbulent public arena. Furthermore, we provide some preliminary findings as collected in Na'amat (an Israeli VNPO of working women) that support the usefulness of this model.     

Post-Contractual Lock-in and the UK Private Finance Initiative (PFI): the Cases of National Savings and Investments and the Lord Chancellor's Department

According to the UK government, one of the key features of the Private Finance Initiative (PFI) is the scope it provides to transfer risk to private sector suppliers. Under the PFI, public bodies are expected to develop interdependent relationships with suppliers that allow risk to be transferred. However, it is the argument of the author that it will not always be possible for interdependent relationships to be engineered by public bodies – on many occasions, public bodies will find themselves asymmetrically locked-in to their supplier. This situation leads to private sector suppliers becoming dominant in those relationships which, in turn, will allow them to pass back risk and obtain greater returns. As a result, the author argues that it is not a question of whether risk can be transferred under the PFI, but when. This argument is illustrated by use of the contracts managed by the UK National Savings and Investments and the UK Lord Chancellor's Department.     

STATE REGULATORY CAPACITY: EXPERIENCES FROM PUBLIC SECTOR REFORMS IN NORWAY

State regulatory capacity is being threatened by internationalization, commercialization and persistent demand for public services. The article addresses the overarching question of how the state is changing due to recent public sector reforms. By studying changes in the regulation of the health care sector and the food sector in Norway, the article challenges the assumption that recent public sector reforms have necessarily led to a decline of the central state's regulatory strength. The conclusions are that the central state level has in fact been strengthened by regulatory reforms, by transferring authority to the state level and by enhancing the central administration's co‐ordinating and regulating capacity.     

Should Business and Non-Business Accounting be Different? A Comparative Perspective Applied to the French Central Government Accounting Standards

The French General Law of Finances of 2001 introduced a set of accounting standards including an explicit conceptual framework reconciling accrual basis accounting with the specific aspects of accounting for central government activities. This article analyzes this French set of accounting standards from a dualistic perspective that compares both business and non-business accounting. Three different views of accounting for business enterprises are addressed: the wealth-basis (static), the cash-basis, and the accrual-basis (dynamic). A dynamic view of the accrual basis is adapted to the specificities of non-business entities, including governments. The accounting representation is used here to explore further the nature and role of public sector activities within the economic system and their economic and monetary significance.     

REFORMING PUBLIC SERVICES IN THE UK: BRINGING IN THE THIRD SECTOR

In the UK, the government continues its project to reform public services. Earlier projects have focused on the modernization of public sector organizations; in the latest round of reform, New Labour has focused on widening choice and the personalization of services. To this end, the government has been working with Third Sector (TS) organizations to expand their role in shaping, commissioning and delivering public services. The government’s vision is predicated on a normative assertion, that, unlike traditional public sector organizations, TS bodies create public value by being more innovative, are inspired by altruistic aims and values, and have greater commitment to their clients. This paper reviews recent policy and questions whether the government’s policy is flawed, contradictory and risks damaging the attributes of the TS admired by New Labour.     

WILL THE PRIVATIZATION OF PUBLIC ENTERPRISES SOLVE THE PROBLEM OF CONTROL?

The Government's privatization programme has acquired such momentum that hardly any public enterprise is exempt from action or proposals. Evaluation of the programme must recognize the diversity of privatization policies, and the tensions inherent within their objectives. Ideological motivation has been supported by the inability of policymakers to design a viable framework of economic and financial control over public enterprises. This has led to a view that it is impossible to manage business efficiently within the public sector, the constraints of which can only be escaped by ‘setting the enterprise free’. However, decisions now will close future options, only be escaped and may be prohibitive to reverse. A list of unanswered questions remain about future relationships between hybrids and governments, the costs and benefits of the regulatory systems which will replace public ownership, and the balance between public policy and private interests. Can the market succeed where the state has been judged to have failed?     

WHAT’S VALUED MOST? SIMILARITIES AND DIFFERENCES BETWEEN THE ORGANIZATIONAL VALUES OF THE PUBLIC AND PRIVATE SECTOR

In recent administrative and organizational literature much attention has been paid to values that guide organizational and managerial behaviour in the public and private domain. Comparative empirical research efforts, however, are sparse. This article reports the results of a comparative empirical survey of 382 managers from a variety of public and private sector organizations in The Netherlands. Contrary to much recent literature that presupposes the intermixing or convergence of value systems guiding governance in different kinds of organizations, the results of this study show two distinct and relatively classical value systems for government and business as well as a ‘common core’ of important organizational qualities. These are accountability, expertise, reliability, efficiency and effectiveness, all of which are considered crucial in both public and private sector organizations. Additional analysis shows that value preferences are primarily attached to sector rather than to age, gender, working experience, or previous employment in the other sector.     

MANAGEMENT INFORMATION FOR MINISTERS: THE MINIS SYSTEM IN THE DEPARTMENT OF THE ENVIRONMENT

MINIS, a management information system for ministers in the Department of the Enviroment, was introduced by Michael Heseltine in 1980. The article summarizes the main features of the system and analyses some of the issues arising from its introduction, in particular, whether it is likely to be adopted by other government departments or public bodies. The reasons offered by departments as to why it is difficult to transfer are examined, together with other factors which are likely to inhibit transfer to other public sector bodies. The mechanism for promoting the spread of such systems is also discussed. The conclusion is that MINIS ought to be considered by other bodies and it has almost certainly already had some impact on systems elsewhere in central government, but without a central initiative, more widespread adoption is on past evidence unlikely, although parts of it may be adopted.     

Turnaround Management Strategies in Local Authorities: Not Only for Poor Performers

In the past four decades, UK government policymakers have sought to improve the performance of local government by trying to achieve organisational turnaround and bring laggards up to the standards achieved by the leaders. Both the Conservative Party and New Labour led new public management reforms aimed at modernizing and improving local government authorities by adopting standards from the private sector. Given the pressure to improve, failing local authorities have been pushed to adopt a unique set of strategies known as turnaround management strategies (TMS). However, this paper, based on qualitative data and a survey of 126 senior local leaders, shows that TMS have been implemented to a high extent among both poor and excellent performers. The paper concludes that regardless of their objective performance ranking, English local authorities are characterised by a self-perception of underachievement. As a result, high performers continuously implement radical changes.     

NEGOTIATION AND MEDIATION IN THE PUBLIC SECTOR - THE GERMAN EXPERIENCE

The article argues that one should look not only at attempts to reduce governmental regulation via privatization and deregulation, but also to pay attention to new modes of dispute-resolution in highly complex and controversial issues. Following an alleged 'crisis of regulatory policy', the authors discuss ways and means of negotiation and mediation in the public sector. Based on American approaches, the German experience is at the forefront of their interest. The systematic and at the same time empirically oriented analysis looks at 'alternative' ways to regulate through cooperative behaviour, evaluates attempts at unassisted and assisted negotiations as a means of conflict resolution, and sheds light on the necessary framework for the use of mediation policies and techniques. A careful optimism on the use of negotiation and mediation in public sector disputes prevails.