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Governments in many Western countries decided in the 1980s that traditional administration was no longer up to the task of modern government. They looked to the private sector to define a new management approach. Management introduces a new vocabulary, mindset, and culture to government bureaucracies. The purpose is to force the hand of bureaucrats to become more dynamic and better managers. A debate has raged in the political science and public administration literature on the merits of the new public management (NPM) in relation to traditional public administration for the past 25 years. A number of politicians in the 1980s decided that the machinery of government was in an urgent need of repair. The old ways were no longer up to the task, and they packaged a series of reform measures that in time would become known as NPM. Proponents of NPM deliberately set high standards with goals to “reinvent government,” “get government right,” and designate those that would “steer” government from those that would be doing the “rowing.”
The word management in NPM implies a decisiveness, a bias for action, and a dynamic mindset. Traditional public administration, meanwhile, conjures up images of rules, regulations, and lethargic decision-making processes. Presidents and prime ministers who came to power in the 1980s concluded that the problem was with bureaucracy, not political institutions. They accused bureaucracy of being bloated, expensive, unresponsive, a creation of routine deliberately resistant to change, and essentially incapable of dealing with new challenges.
It is one thing to diagnose the patient, but it is quite another to come up with the remedy. Initially, at least, political leaders were left to try this or that to see what would work with varying degrees of success. In time, a new approach, anchored in private sector management practices, began to take shape and a label was attached to it—NPM.
The goal was nothing short of introducing a new culture in government departments and agencies. The old culture was found wanting on many fronts. It attached too much importance to due process, prudence, probity, and centrally prescribed administrative rules and regulations. It also encouraged senior civil servants to focus on policy issues rather than on management. The old culture, associated with traditional public administration, was considered not only outdated but also counterproductive. Public administration became synonymous with the old culture.
NPM would introduce a new vocabulary, a new way of thinking, and a new culture. It would also give rise to a proliferation of management techniques to force government operations to become more efficient. The purpose was to force the hand of senior government officials to become better managers and to learn to make tough management decisions. Taken at face value, the political rhetoric that accompanied the arrival of NPM to government meant setting the civil service at its own throat.
The Canadian government published a report designed to contrast the old culture (public administration) with the new culture (NPM).
NPM holds important advantages for politicians. In forcing the hand of senior civil servants to become better managers, politicians would gain the upper hand in shaping policy initiatives. The thinking was that civil servants had too much influence on policy at the expense of politicians. The message from politicians to senior civil servants could not be clearer under NPM—you worry about managing government operations better, and we will worry about setting policy priorities.
How then would civil servants become better managers? NPM encompasses a number of broad strategies to promote cultural change in government: decentralization of decision making, empowerment, a reduction on controls on managers, more flexible organizational structures, upgrading the skills of government managers, and a stronger sense of service to the public. Government departments and agencies were also encouraged to launch review exercises to identify “useless” red tape and “delayer” management levels.
In time, NPM became the fashion in much of the Western world. Margaret Thatcher in the United Kingdom (UK) showed the way with numerous measures designed to overhaul government operations. She cut the size of the civil service (from 733,000 strong to 569,000), restructured government operations by creating executive agencies and gave them a narrow mandate to deliver public services, privatized state corporations, delegated more authority to frontline managers, and overhauled the government’s financial management system. This and other private sector management-inspired measures gave life to NPM in the UK. Before long, Australia, New Zealand, the United States, and Canada, among others, also introduced numerous NPM-type measures with varying degrees of success. Countries that did not pursue NPM with any enthusiasm, such as France, were regarded as being out of step with modern management strategies.
The contrast between the old (public administration) and the new (NPM) is striking and instructive. However, it probably came as a surprise for retired civil servants to discover that their culture was “rigid” and gave rise to “suspicious” and “secretive” behavior, which in turn served to “stifle creativity,” which led them to “communicate poorly.”
Old cultures die hard, if they die at all. NPM has met some successes but also failures. Graham Allison (1987) went to the heart of the matter when he wrote,
The perception that government performance lags behind private business performance is correct. But the notion that there is any significant body of private management practices and skills that can be transferred directly to public management tasks in a way that produces significant improvements is wrong. (p. 525)
The sharp differences between the public and private sectors make it difficult for a number of NPM measures. The public sector does not have a clear bottom line and has legislative requirements of reviewing the work of government managers. Indeed, public sector managers depend on political bodies both for their authority and for their budgets, and they are subject to far greater public scrutiny of their actions. They are directly accountable to their political masters, and no matter what form of government organization is in place it can only enjoy legitimacy through the political process. Although it can take various forms, governments must have an accountability process to make the exercise of power responsible. This speaks of the merits of traditional public administration.
Traditional public administration has shortcomings, but it is directly tied to national political institutions and their accountability requirements. Hierarchy, command and control, and centrally prescribed rules and regulations enable political leaders to reach down to all departments and agencies and determine who did what and why things went wrong.
NPM had to compensate somehow for its call to empower managers, to flatten organizations, and to import numerous private sector management practices to government. An emphasis on measuring performance became another defining characteristic of NPM. Nothing is left in government that is not up for measurement from the performance of senior civil servants to program activities in all sectors whether economic or social. The thinking is that establishing performance standards will provide for more effective accountability and also enable both politicians and citizens to see how well civil servants and programs perform.
The demand for information to fuel performance measurement and evaluation initiatives by central agency and senior departmental officials has increased substantially in recent years throughout the Western world. It seems that everything in government now needs to be measured to have any standing in the expenditure budget process. This squares with NPM’s emphasis on outputs, on good management, and on evaluating how well individual civil servants and programs perform. This too is in contrast to traditional public administration with its emphasis on controlling input costs and holding civil servants accountable for their administrative decisions.
Proponents of traditional public administration insist that politics and the public sector do not lend themselves to big answers. Public administration operates in a political environment that is always on the lookout for “errors” and that exhibits an extremely low tolerance for mistakes. The attention of the national media and political opponents are sufficient to explain why civil servants are cautious and why they strive to operate in an error-free environment. One would have to let the imagination run wild to visualize a headline in the media applauding the fine work of “empowered” civil servants. Supporters of traditional public administration insist that it is unwise to think that one can import private sector management strategies to government. They point out that in business it does not much matter if you get it wrong 10% of the time as long as you turn a profit at the end of the year. In government, it does not much matter if you get it right 90% of the time because the focus will be on the 10% of the time you get it wrong.
In the end, the debate that truly matters between the two camps centers on accountability. Both sides insist that their approach holds greater merit in ensuring that politicians and civil servants are accountable for policies and the delivery of government programs. For politicians and civil servants, both approaches have strengths and drawbacks— traditional public administration provides more stability and predictability while NPM provides greater flexibility and a capacity to measure the performance of both senior civil servants and programs.
- Allison, G. T. (1987). Public and private management: Are they fundamentally alike in all unimportant respects? In J. M. Shafritz & A. C. Hyde (Eds.), Classics of public administration (pp. 510-528). Chicago: Dorsey.
- Borins, S. (1995). The new public management is here to stay. Canadian Public Administration, 38(1), 122-132.
- Osborne, D., & Gaebler, T. (1992). Reinventing government. New York: Addison-Wesley.
- Peters, B. G., & Savoie, D. J. (1994). Civil service reform: Misdiagnosing the patient. Public Administration Review, 54(5), 418.
- Rainey, H. G., Backoff, R. W., & Levine, C. H. (1976). Comparing public and private organizations. Public Administration Review, 36(2), 233-244.
- Savoie, D. J. (1994). Thatcher, Reagan, Mulroney: In search of a new bureaucracy. Pittsburgh, PA: University of Pittsburgh Press.
- Savoie, D. J. (1995). What is wrong with the new public management? Canadian Public Administration, 8(1), 112-121.