OPINION:Decision-making on public resources is centralised, and while this may keep spending down it fails to optimise delivery of services
AMID ALL the criticisms of the Croke Park agreement, as well as the public service and their costs and allowances, we risk missing the obvious: the public sector is primarily about delivering.
This hardly seems radical, but today the focus is almost entirely on spending and its control. Decision-making on resources is now rigidly centralised, and while this may help keep spending down, it fails to secure the delivery of services society rightly demands.
What should change? With resources scarce we must ensure that all our public sector organisations are focused on delivery.
To do this we need to move power away from the centre and give public sector organisations more control over their own resources. But they, in turn, must agree, within tight spending limits, to meet specific and challenging service targets and to be held to account for their delivery.
Accountability is central to what gets attention and to what gets done. In the private sector, this focuses attention on delivering financial results. In the non-commercial public sector, especially the Civil Service, accountability is mainly about spending the money as provided. At its most extreme, success is spending all your money.
Every year the Oireachtas allocates money for each public sector body. At the end of the year, the Comptroller and Auditor General (CAG) audits the accounts of all departments and provides a comprehensive report that forms the basis for the accountability examination by the Oireachtas Committee of Public Accounts (PAC).
Accounting officers, usually secretaries general, have to demonstrate that the money they were responsible for was spent as intended by the Oireachtas. While they are charged with a general role of efficiency, they are prohibited from discussing the effectiveness of spending with the PAC.
The government’s auditor, the CAG, is also prohibited from commenting on effectiveness. This is the public accountability framework for our public sector leaders, an approach that is centred on spending and in effect excludes delivery. Apart from ministers’ political accountability to the Oireachtas and the electorate, there is no meaningful accountability for service delivery.
As an alternative, we could adopt a more balanced but more ambitious regime where the public sector is held to account for results as well as spending. Proper accountability for results would revolutionise performance.
How might it work? At the outset ministers and public sector managers would have to agree on objectives to be delivered over time within a particular resource level and reflecting government’s policy programme.
Public sector managers would then make explicit commitments to the Oireachtas for the money allocated to them. These managers would subsequently have to report back to the Oireachtas, with their audited annual report, on the delivery of these promises.
This process of linking spending to service delivery and subsequent accountability would bring a collective focus to the delivery of commitments within tight overall resources.
I believe failures in delivery by the public sector, whether in education, health or regulation, are of deeper significance and cost to our society than the type of spending failures identified and highlighted under our current accountability regime.
A significant devolution of authority from the central departments of State to public sector organisations would be required if such bodies were to be realistically and fairly held accountable for delivery. Some at the centre may struggle to trust the capacity of public bodies to adhere to the necessary spending controls; however, without empowering such bodies and measuring their performance in terms of delivery, we can never fully harness the knowledge and personal drive of the countless and able public servants.
This results-based accountability system would also dramatically affect the work and role of the Oireachtas, by empowering it to hold the executive to account for service delivery. Currently, only the public accounts committee examines departmental spending and it has the support of the CAG in this.
Under this new system this role would be extended and each Oireachtas committee would examine, with the support of the CAG’s office and the audited annual report, the delivery of results for the departments and organisations under their remit. While this may appear innocuous, it would radically transform the role of the committees and, over time, the effectiveness of the Oireachtas.
Measuring and reporting on spending is relatively straightforward. However, risk avoiders and risk takers, innovators and conservatives, high performers and the mediocre are often indistinguishable in the darkness of spending-based accountability.
The majority of public servants are passionate about delivery, but the way they are currently held to account, coupled with their limited control over resources, inhibits innovation and encourages risk aversion to the detriment of performance.
Moving to results-based accountability offers them the opportunity to be judged in a more rounded way – where mistakes can be judged alongside successes. Innovation and ambition would then become the tools of our public sector leaders as they strove to deliver on the services they committed to provide.
The transformation I advocate is not very complex in theory but it would have a profound and ongoing impact. Introducing it would be difficult and challenging for all concerned. Ultimately it would create a positive spiral as we collectively learned to use the system to drive performance.
We need to move the debate on the public sector beyond bonuses, allowances, costs, and spending failures. Let us all share an ambition and use a new system of devolved authority and enhanced accountability to make Ireland the best-governed small country by 2016.
I believe that our public service would be proud to deliver on such an ambition.
Paul Haran sits on the board of a number of public and private sector companies and is chairman of the UCD Michael Smurfit Graduate Business School. He was secretary general of the Department of Enterprise, Trade and Employment from 1997 to 2004