Vance on state sector reforms

A very interesting article from Andrea Vance at Stuff:

While Mr Key will front the reforms, they are being driven by Finance Minister Bill English – who is deeply committed to remodelling the sector. And no wonder – he pays the bills and it accounts for one third of New Zealand’s economy.

Essentially, in a drive that would send Sir Humphrey Appleby into apoplexies, the public service is about to become more flexible.

It’s a remarkably simple idea but one that strikes at the very heart of the modern-day civil service. At present individual departments and agencies work on their “outputs” – what they deliver. The social development ministry pays out benefits, Corrections builds more prisons. Annual incentives are set, targets are ticked off and budgets are (usually) met. They work in – excuse the jargon – silos.

By and large “outcomes” – the big picture stuff – are not catered for. …

Politically, “outcomes” are a lot more risky than easily measured “outputs”; it takes just one rogue NGO, or one mis-timed question from the Opposition about a taxpayer funded hip-hop scheme or a misappropriation of funds.

Moving the state sector from being focused on outcomes outputs to outputs outcomes is a heroic endeavour, but worthwhile. As Andrea says, outputs are easily measured and easy to achieve. If one moves towards outcomes, then one has to accept there will be some failures. You can near guarantee outputs, but outcomes are far more complex.

In its purest form, we might see super-ministries, although National is shying away from this for the time being. Instead of merging Corrections, police and justice into one monster law and order department, they have established an umbrella board to oversee co-operation.

I tend to favour super-ministries, but sharing of back office functions and a joint board to over-see co-operation is a step in the right direction.

Which means we are also unlikely to see the logical conclusion of this shift: a much smaller executive.

A half-serious proposal for a seven minister Cabinet was recently floated – and hastily dismissed. National has instead opted for “cluster” ministers – Steven Joyce overseeing economic development, David Carter taking on primary industries.

The model I favour is a 12 member Cabinet with 12 full Ministers (for 12 super-ministries) and 12 Associate Ministers outside Cabinet who will be delegated responsibilities for particular agencies within a super-ministry.

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