Public Management and Governance

Tony Bovaird, Elke Loeffler, Tony Bovaird, Elke Loeffler

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317435839
• Edition: 3
• Topic: Business
• Subtopic: Business General
• Index: Business

Public Management and Governance examines the factors which make government critically important and the barriers which often stop it being effective. It questions what it means to have effective policies, efficient management and good quality public services, and it explores how the process of governing could be improved. Key themes include:

• the challenges and pressures facing governments around the world;
• the changing role of the public sector in a 'mixed economy' of provision;
• governance issues such as ethics, equalities, transparency and citizen engagement.

This revised and updated third edition includes eight new chapters which provide in-depth coverage of key new aspects of public management and governance. It also features a wide selection of international case studies and illuminating examples of how public policy, management and governance can be improved – and what happens when they fail. Each chapter is supplemented with discussion questions, group and individual exercises, case studies and recommendations on further reading.

Public Management and Governance

is one of the leading student textbooks in its field, featuring contributions from top international authors and covering a wide range of key topics in depth. It is an essential resource for all students on undergraduate and postgraduate courses in public management, public administration, government and public policy.

Part I
From public management to governance

Part I forms an introduction to the key themes of the book and locates the public sector in its political, social and economic context.

Chapter 1 examines what is ‘public’ about the public sector and about public services. It distinguishes public management from the wider issues of public governance.

Chapter 2 explores recent changes in the context of public policy, identifies the major paradigm shifts in public policy-making in recent decades and examines the changing role of politics in public governance.

Chapter 3 examines the size and scope of the public sector. It compares trends in the size and composition of public expenditure across OECD countries and looks at some of the forces that shape these trends. It then considers the implications of these trends for public sector management.

Chapter 4 examines the objectives and results of the generation of public sector reforms since the 1980s, the different reform trajectories across OECD countries and some of the risks and unintended consequences of public sector reform.

1
Understanding public management and governance

Tony Bovaird and Elke Loeffler

Why study public management and governance?

Welcome to Public Management and Governance. We aim to provide you with up-to-date, state-of-the-art knowledge on what the public sector is doing, why it is doing it and how it might do it better. We hope also to challenge you to think out for yourself how your society should be governed – one of the questions that has fascinated people for thousands of years – and how your governors should be managed – a question that is much more recent. Along the way we hope that you will have fun as well. Above all, we will be introducing you to the ideas of some of the leading analysts of the public sector around the world, so that you can weigh up their arguments and develop your own.

So what’s in store? A book full of analysis of worthy but boring public sector activities? Actually, issues of public management and public governance are often very interesting (see Box 1.1). That’s why they attract some highly talented and dedicated people, who might earn a great deal more money in other jobs. However, we also want to warn readers of this book that it can no longer be taken for granted that the activities of public management and governance are always ‘worthy’ – sometimes they are conducted by ‘sharks’ rather than by ‘suits’ (see Box 1.2).

Consequently, nowadays public managers have to earn our respect and gratitude, rather than simply assume it. And the players in the public policy arena have to earn the trust of those for whom they claim to be working, rather than claiming legitimacy simply on the grounds that they were elected or that they are part of a prestigious profession. So this third edition of Public Management and Governance suggests some tough questions for you to ask to see if that trust has indeed been earned – and gives you some ammunition for the debate.

Learning objectives

The key learning objectives in this chapter are:

• to be aware of the different meanings of ‘public’;
• to understand the main differences between public management and public governance;
• to understand the motives for studying public management and public governance.

Box 1.1 Public management and governance issues are interesting …

Public policy on global warming

[T]he more I think about it, the more fatalistic I become. … I suspect the newspapers echo public opinion on this subject. Just about all national papers now accept global warming, but they still object to anything required to deal with it. Low-energy light bulbs will cause old folk to fall down stairs. Higher petrol duties or road charges will be unfair to the poor (although most poor people don’t own cars). Restrictions on cheap air travel breach the time-honoured British right to celebrate summer by vomiting over waiters in Faliraki. Wind turbines are ugly. And so on. Does anyone really think that, barring technological miracles, we have the slightest chance of averting calamity?

Source: Wilby (2009: 10)

Box 1.2 … But not necessarily ‘worthy’

The police, the press and the public interest

On 20 June 2011 News International (NI) disclosed material to the Metropolitan Police Service that indicated that police officers had allegedly been receiving cash/cheque payments from journalists from the News of the World newspaper for the provision of confidential information. Subsequent enquiries uncovered similar suspicions in relation to journalists at The Sun newspaper, within the NI group. Alleged payments by journalists to public officials across all areas of public life were identified by the police inquiry, including payments to police, military, health, government, and prison officials. The Metropolitan Police described the evidence as revealing a network of corrupted officials. There appeared to have been a culture at The Sun of illegal payments, with systems created to facilitate such payments whilst hiding the identity of the officials receiving the money.

Source: Adapted from Akers (2012)

What do we mean by ‘public’?

The essential task of the public domain can now be interpreted as enabling authoritative public choice about collective activity and purpose. In short, it is about clarifying, constituting and achieving a public purpose. It has the ultimate responsibility for constituting a society as a political community which has the capacity to make public choices. Producing a ‘public’ which is able to enter into dialogue and decide about the needs of the community … is the uniquely demanding challenge facing the public domain.

Source: Ranson and Stewart (1994: 59–60)

Before we go further, we should explore what we mean by ‘public’. We start from a clear statement from Ranson and Stewart (1994: 59–60) as to what constitutes the public domain. (They wrote in the context of local government, but their analysis applies quite generally.)

This short passage explains how the public domain is the arena in which public choice is exercised in order to achieve a collective purpose. This is the arena which this book explores.

Ranson and Stewart also introduce another meaning of the word ‘public’ – the group (or groups) of people who inhabit the public domain. They clearly identify the political concept of ‘a public which is able to enter into dialogue and decide about the needs of the community’, which we might contrast with the marketing concept of different ‘publics’, each of whom expects to be treated differently by public services and public managers.

Another common usage of ‘public’ is to distinguish between the ‘public sector’ and the ‘private sector’, which essentially revolves around differences of ownership (collective ownership, in the name of all citizens, versus individual ownership) and motive (social purpose versus profit). This meaning is particularly relevant when public managers try to claim that the public sector is different from the private sector and that therefore private sector management methods would not work in their agency (see Allison (1994) on the concept that public and private management are alike in all unimportant respects!).

However, there are other, wider meanings to ‘public’. For example, ‘public services’ are sometimes delivered by private or third-sector contractors, rather than public agencies. Here, the concept of ‘public’ generally means that the providers have to observe and satisfy some form of ‘public service obligation’. Again, ‘public issues’ are those which cannot simply be left to the decision-making of private individuals – they typically necessitate mobilising the resources of public and voluntary sector organisations or regulating the behaviour of private firms or individuals or groups in civil society.

We shall examine each of these dimensions of ‘public’ in this book. Consequently, we shall take the word ‘public’ to be part of the problematic, i.e. the set of concepts to be explored in this text, rather than defining it unambiguously here at the outset.

Public management and governance: some key issues

So, what is public management? And what is public governance? While most people will immediately assume that they have a general grasp of what public management entails, fewer will have a feel for what is meant by public governance. Moreover, we want to argue that both concepts actually cover quite a complex set of ideas.

We shall take public management to be an approach that uses managerial techniques (often originating in the private sector) to increase the value for money achieved by public services. It therefore covers the set of activities undertaken by managers in two very different contexts:

• in public sector organisations;
• in public service organisations, whether in public, voluntary or private sectors.

This raises a number of issues that we will consider later:

• What distinguishes ‘public management’ from ‘public administration’?
• What is ‘public’ about public services?
• Are ‘public services’ always in the ‘public sector’?
• Is public management only about public services?

We take public governance to mean ‘how an organisation works with its partners, stakeholders and networks to influence the outcomes of public policies’. (You will find other approaches to defining ‘governance’ in chapter 15.) The concept of public governance raises a different set of questions, such as:

• Who has the right to make and influence decisions in the public realm?
• What principles should be followed in making decisions in the public realm?
• How can we ensure that collective activities in the public realm result in improved welfare for those stakeholders to whom we accord the highest priority?

This chapter addresses these issues and sets the stage for the rest of the book.

Is ‘public management’ different from public administration?

In the middle of the twentieth century, the study of the work of civil servants and other public officials (including their interface with politicians who passed legislation and set public policy) was usually labelled ‘public administration’. As such, there is no doubt that ‘public administration’ conjured up an image of bureaucracy, life-long secure employment, ‘muddling through’ and lack of enterprise – dark suits, grey faces and dull day jobs.

From the 1980s onwards, however, a new phrase began to be heard, which even achieved dominance in some circles – ‘public management’. This was interpreted to mean different things by different authors but it almost always was characterised by a different set of symbols from those associated with public administration – it was thought to be about budget management, not just budget holding (see chapter 8), a contract culture (including contracts with private sector providers of services (see chapter 7) and employment contracts for staff, which were for fixed periods and might well not be renewed, see chapter 8), entrepreneurship and risk taking, and accountability for performance (see chapter 11).

These differences can be (and often were) exaggerated. However, it appears that the expectations of many stakeholders in the public domain did alter – they began to expect behaviour more in keeping with the image of the public manager and less that of the public administrator.

What is ‘public’ about public services?

In everyday discussion, we often refer to ‘public services’ as though they were ‘what the public sector does’. However, a moment’s reflection shows that this tidy approach nowadays doesn’t make much sense any longer, at least in most countries (see chapter 4).

After all, we have for a long time become used to seeing private firms mending holes in our roads and repairing the council’s housing stock. More recently it has become commonplace in many areas to see private firms collecting our bins and running our leisure centres. Moreover, whatever country we live in, there are very few services that are never run by the private sector – in the UK it has been possible to find some places that have private provision of hospitals, schools, child protection, home helps for the elderly and disabled, housing benefit payments and a local council’s Director of Finance. (Indeed, in the UK we even had, for a while, provision of the post of Director-General of the BBC by a private company.)

Furthermore, there are some things that are done by the public sector that might cause raised eyebrows if described as ‘public services’ – such as running a telephone company (as the city of Hull did until comparatively recently), or a city-centre restaurant (as Coventry did up to the 1980s).

So what is public about public services? There is no single answer to this prize question – but neither is there a lack of contenders to win the prize. The answer you come up with is very likely to relate to the discipline in which you were trained and to your ideological position.

For welfare economists, the answer is quite subtle but nevertheless quite precise – public services are those which merit public intervention because of market failure (see chapter 3). In other words, any good or service that would result in suboptimal social welfare if it were provided in a free market should be regulated in some way by the public sector, and in this way qualifies as a ‘public service’.

Differences between the concept of a citizen and the client/customer/user of public services

A citizen can be defined as a concentration of rights and duties in the person of an individual, within a constitutional state, under the rule of law, and within the hierarchy of laws and regulations.

A client is a concentration of needs and satisfactions of needs in an individual, within a market situation of supply and demand of goods and ser...