Within Europe the NPSM is essentially a British phenomenon. It is also found in North America and Australasia but the intensity of change is probably greatest in Britain.
The emergence of the NPSM arose from the confluence of a number of different tendencies. First, there was the libertarian ideology of the new right with its emphasis upon controlling the power of the State; reducing public expenditure; reducing public sector borrowing and creating incentives for enterprise by reducing marginal rates of taxation. Second the general public and those on the left demanded greater accountability of the professional monopoly suppliers of public services who appeared to make decisions about public service provision according to professionally determined standards without recourse to the "voice" of those who consumed and financed these services. The users of public services felt a sense of frustration born from powerlessness in the face of dissatisfaction with the quality of these services. Taken together these sentiments amounted to a growing demand for greater efficiency in the use of public finance, improvements in service effectiveness and enhanced value for money.
One solution that might satisfy these demands is an improvement in the efficiency of public spending. Efficiency gains would release resources that could then be used to finance the growing demands for public services whilst containing public spending and enabling reductions in public borrowing and taxation. The means of achieving these efficiency gains is through improved management.
This, however, seems very rational. The advantage of hindsight assists this ex post rationalisation. In fact the NPSM was emergent: it was crafted. Only retrospectively can the NPSM be identified. Nor is the NPSM a unified whole: it means different things to different people. Like the blind men describing an elephant there are differences in perception depending upon the position in which one is standing. Today it is possible to take stock and to at least list a catalogue of elements that might be thought of as the NPSM. This is listed in Table 1. The catalogue is in no sense complete. Each management consultancy group has its own variants of some of these generic ideas.
A distinctive feature of the NPSM is the emphasis now placed upon competition and the role of competitive forces in securing improvements in efficiency. "Competition became the guardian of the public interest and the means of achieving efficiency" (2). Competition between alternative suppliers, it is claimed, will improve technical and allocative efficiency. This belief in the efficiency benefits of competition resulted in, a fundamental change in the public policy paradigm which was essentially a top down policy planning model in which the authority to administer policy was invested in civil servants (central and local). However, as a result of restructuring for competitive engagement, there now exists a complex web of agencies and contractual relationships.
Within the NPSM emphasis is placed in the belief that the production of public service strategies; new organisation structures; new management information systems; new reward systems; better skilled staff and improvements in management style will result in enhanced value for money. But what is the reality? If we move beyond the means of achieving this end and ask what been happening in practice: how difficult is it to bring about change: what are the pitfalls and limitations of the techniques of the new managerialism then we cut through the hype. Many of the ideas and concepts of NPSM are not new. They are old ideas which have been repackaged. The ideas of setting objectives and measuring output and outcomes were on the agenda some thirty years ago. Most of the generic management techniques were taught at the Centre for Administrative Studies, the forerunner of the Civil Service College in the early 1970s. But how many people remember the use of variants of programme, planning and budgeting systems (PPBS) by the Ministry of Defence or output budgeting in the Department of Education?
Table 1: Elements of the New Public Sector Management
By getting behind the hype we can recognise that books such as Peters and Waterman's In Search of Excellence or Osborne and Gaebler's Re-inventing Government were exercises in rhetoric. They elevated general principles, homilies derived from a few carefully chosen case studies which were then accepted by zealots who had captured positions of influence and who could then use those principles to bring about changes. Those changes were, in essence uncontrolled giant social experiments based upon weak methodologies in which the experimenter was prepared to blindly predict out of sample.
Going beyond the hype means critically evaluating the exaggerated claims of the proponents of the new managerialism. What is the empirical evidence relating to the success of the new structures etc. in delivering improvements in efficiency and effectiveness? Who has benefited and how much has the change cost? These are big questions which are difficult to answer. But unless we seek answers to them then we shall never learn and the net benefits of the NPSM will remain an article of faith.
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