Public sector needs fresh ideas, not staff cuts

Thursday, 12 May 2022

National Party leader Christopher Luxon has refused to rule out ACT policy that calls for several ministries to be axed.

Josie Pagani has worked in politics, aid and development.

OPINION: Parties conformed to type this week when announcing their plans for the public sector.

Labour promised public sector growth. National promised to reverse public sector growth. ACT promised to bulldoze whole departments.

Improving public service effectiveness needs fresher ideas than growing or reducing staff numbers, or closing down government departments.

Any good policy analysis starts with a problem definition: the public sector is incentivised to be risk-averse, to avoid embarrassing ministers, or promoting policy frameworks that challenge political tides. But policy development requires a contest of ideas.

ACT leader David Seymour has pledged to axe several ministries if his party is part of the next government.

* Willie Jackson lashes 'useless' David Seymour's cost-cutting policies

National’s leadership has said it will reverse the growth in public sector staffing numbers under Labour.

* Christopher Luxon rules out David Seymour as finance minister in National Govt

Only a handful of Cabinet members actually matter, says Josie Pagani, so let’s have fewer of them, more like a board of directors.

Risk aversion in delivering services is highly desirable, but being risk-averse in making policy leads to a search for “evidence-based” and “best practice” ideas, which is helpful but can also obscure choices between competing values and interests.

Another problem: the same Wellington outfits that develop and administer policy also deliver it and evaluate it. Consequently, the typical policy review finds that settings are “mostly right, just a few tweaks needed”.

Sometimes failures are not seen at all. When the Treasury analysed the effectiveness of health policy it didn’t even mention the words “dental health”, the most glaring failure in our health system.

We need a new institutional arrangement for the public service that incentivises diversity of thought and strengthens the contest of ideas, writes Pagani. (File photo)

It’s rare for an official to declare a delivery model is failing, or for a minister to take ownership of a policy failure, so change tends to come about only through a change of government.

Policy institutions have not really evolved from first-past-the-post. One lot comes in and one lot goes out. MMP could allow for more shifting alliances over policy priorities.

Take ACT and Te Pāti Māori, which this week could not be further apart. And yet ACT has a commitment to smaller government, while it’s possible to imagine a vibrant Māori interest in devolving many services to Māori self-governed delivery. Education, much healthcare and social welfare are all delivered by the state with poor results for Māori. Perhaps they should talk.

Josie Pagani: “Divide public sector policy advice more clearly from implementation. People who do stuff should not be the same people who tell us how it is going.”

New Zealand has the population of a large international city, so we don’t have a thriving network of think tanks and independent institutes refining new ideas. There are a couple of valiant exceptions, like the Maxim Institute and the New Zealand Initiative, plus lobby groups, but we lack the vibrant background policy battles seen in other democracies.

In the 1980s, MPs deployed far more resources for their policy and research. Most of this was used to attack each other and service the parliamentary Question Time theatre.

Politicians are actively punished for having original ideas. They are told to keep their heads down if they want to get into Cabinet. Only a few in Cabinet really matter. The rest make decisions but won’t bend the arc of history.

All of this is not a criticism of people. What we need is a new institutional arrangement that incentivises diversity of thought, strengthens the contest of ideas, and hones alternative policy frameworks instead of vote-grabbing initiatives tailored for three-year cycles.

Here are four ideas.

Divide public sector policy advice more clearly from implementation. People who do stuff should not be the same people who tell us how it is going. That would mean more honesty about failure and weakness. Let’s call this the “Transmission Gully Initiative”.

Power up select committees with their own permanent, substantial, policy and research capability carved out of existing ministries. MPs would decide whether to make their careers as legislators who write laws as select committee chairs, or executives who run ministries.

With policy review and development resources available to opposition MPs, they would arrive in government brandishing alternative policies, fully thought through and developed. Call this the “Not Repeating KiwiBuild Initiative”.

Power up, don’t power down, the advocacy ministries. ACT and the Māori Authority clashed over ACT’s proposal to axe the ministries for Women, Youth Development, Pacific Peoples and Te Puni Kōkiri. TPK is different to the others, but the real issue is effectiveness.

The ambition for those ministries is research, policy voice and scrutiny on behalf of diverse parts of our community. Make them more independent, like the Parliamentary Commissioner for the Environment or the Commerce Commission – heavyweight agencies whose analysis and advice is not dependent on ministerial approval. They could think the unthinkable and be free to persuade.

Run it all with a much smaller Cabinet: five or six individuals who focus on strategy, more like a board of directors. Most MPs would never be in Cabinet, so there would be real competition, and fewer anonymous seat-fillers.

All of this in service of bolder policy choices leading to more effective public services.

Not wanting to push my friends on the left to the smelling salts, let me quote former UK prime minister Tony Blair: “The radical decision is usually the right one. The right decision is usually the hardest one. And the hardest decisions are often the least popular at the time. We are at our best when we are at our boldest.”