|CPDS Home Contact||Professionalism: Chronological Summary|
A Service Delivery and Performance Commission (SDPC) has been established to search for, and eliminate, waste in Queensland state departments and commercialized agencies . This arose from efforts to find ways to finance increased spending on public hospitals.
It was suggested that the SDPC would conduct reviews and identify any cost savings, waste or inefficiencies and eventually save $150m pa. It would start by considering whether a range of commercial business functions should be undertaken by the private sector .
This document will basically suggest that the SDPC proposal will prove an inefficient mechanism for eliminating inefficiency, and is in fact symptomatic of the inward-focused central-government obsession with cost saving and mechanical efficiency and the limited ability to provide wise advice about what government should actually be doing, that seem to be primary causes of ineffective resource usage in the public sector.
Reactions to the proposal for an efficiency audit were that:
Evidence of a Problem
There is almost certainly waste and inefficiency in Queensland's Public Service, and thus potential for increased productivity and savings.
|Source of Problems||
Unfortunately ineffective and inefficient resource usage is built into the machinery of government that has evolved in Queensland. It can not be eliminated by mere cost-cutting initiatives.
In fact Queensland's Public Service already seems to be subjected to many processes intended to promote cost saving - presumably because the present state government has sought ways to fund its many new, but not always well conceived, programs.
However such methods to promote efficiency do not work well. In fact some can be counter-productive.
Moreover, even if some waste is being identified and eliminated, there is nothing to stop overall resource usage from becoming more and more wasteful. This can happen because new policy initiatives will use resources inefficiently and ineffectively if the mainstream mechanisms for making decisions and implementing programs are seriously defective .
While the effectiveness of the latter machinery (eg mechanisms such as those related to cabinet, agency management and planning and the state budget) has not been systematically studied the 'clump of spaghetti' analogy that was applied to Queensland Health  seems applicable to administrative machinery as a whole. That machinery has been arranged to increase centralized accountability, even though attempts to enforce prescriptive central control of complex functions inevitably reduce scope for initiative and increase costs (just as regulatory 'red tape' does for business).
In the first place federal financial imbalances (under which the federal government gains most revenue and states have most spending responsibility) have encouraged increasing attempts at centralized control (especially since the 1970s). This has made it almost impossible for states to effectively act in their nominal areas of responsibility because of:
Duplication, buck passing and complexity has been the major result.
At the state level, government machinery has gained an increasing tendency to generate ineffective and inefficient resource usage because of unbalanced 'reform' of Queensland's system of public administration over the past 15 years. For example:
The highly centralized state machinery that has now emerged is quite different to traditional reliance on experienced professionals to know and generally do the 'right thing' and seems to suffer many practical defects.
In addition to eroding the practical skill base and experience of the Public Service and making the process of administrative decision making too centralized to be realistic, attempts were made to make government agencies operate 'commercially' so as to achieve what was perceived to be business-like efficiency. This reflected a failure to appreciate that the functions of government are intrinsically unlike those business is involved in (see The Decay of Australian Public Administration).
Briefly: Commercial methods are useful for managing the 'production of things' that are coordinated through market mechanisms, but the primary role of government is to manage the 'relationship between things' that can't be properly coordinated through any market.
The overall effect has been the breakdown of government machinery as recorded above, and the transformation of the public sector into a 'cancer' eating away at the health of Queensland's society as a whole.
|SDPC: A Non-solution||
Eliminating Waste Inefficiently
Unfortunately the establishment of the SDPC is likely to be an inefficient way to identify and eliminate waste and inefficiency. It seems merely to be a continuation of an compulsive inward-focused obsession with corporate services and cost cutting that has been the substitute for realistic outward-focused policy leadership by Queensland's central government agencies.
In theory the SDPC could target the necessary fundamental changes to Queensland's machinery of government. However it seems extremely unlikely that it will be encouraged to take anything but a short-term 'cost-cutting' view given that:
Thus, noting that one observer expected that the SDPC might have a broader 'priorities review' role , a range of outcomes can be expected from the SDPC:
|Better Solution||A Better Solution?
Real productivity gains are less likely to be achieved by short term spending cuts, than by institutional changes which provide more capable ongoing support to elected governments in determining and managing their policies and programs.
Thus in order to make a serious difference to the cost and effectiveness of government in Queensland it is probably necessary to:
|Second-best Options|| Second-best Alternatives?
In the event that reform of mainstream government machinery proves impossible then winding-down direct state involvement in service delivery (and reliance on privately provided services) would be an alternative.
However in considering the option of 'demolishing' government service delivery operations, it needs to be recognized that they tend to be in functions that are subject to real market failures which do not correct themselves through natural development of the economy (ie to involve functions subject to large externalities; or be natural monopolies; or be affected by particular public policy priorities such equity issues in education).
Australia's democratic capitalist system of political economy is effective partly because the representative political process allows 'public' goods and services to be provided, and is also able to alter 'free market' outcomes that would otherwise result in politically-destabilizing social stresses.
Even though service delivery in a political environment creates difficulties, government service delivery was obviously felt at one stage to be the best option for some functions. It is understood that large scale private provision of 'public functions' led to serious abuses in Britain in the 19th century (eg patronage in licensing service providers) and that these abuses were the primary reason for the emergence of the Westminster system which emphasised administration of such functions by a professional civil service.
If the shambles in public administration can not be corrected and major government service delivery roles have to be terminated, it needs to be recognized that alternatives are not problem free.
The overall conclusion from the above is that large scale private involvement in the delivery of 'public' goods and services will inevitably lead to difficulties in achieving desirable public policy outcomes, and may not even yield cost savings because of complex parallel arrangements needed to meet those policy goals in other ways.