13: Getting Better but Feeling Worse? Public Sector Reform in New Zealand

It has become a cliché to say that the New Zealand state sector reforms have been more radical and comprehensive than those in any other OECD country, and have attracted a huge amount of interest from academics and practitioners in other countries. It is, however, extremely difficult to offer any objective and conclusive assessment as to their success or failure.

The main objectives of the changes were to enhance both the efficiency and accountability of the state sector. But both of these terms are rhetorical rather than strictly operational, at least when any attempt is made to measure them in general rather than specific terms. For example, it might be concluded that particular service components are delivered with equal or more effectiveness and at less cost than before the reforms, but it is much harder to assess whether the state sector as a whole or the public service is more efficient overall than before. How can we know? Merely looking at the dramatic drop in the numbers of public servants is clearly misleading on at least two counts. First, many people who formerly were employed in the public service as such may now be either working in crown entities that carry out these tasks, but which are now not part of the public service. Or many others may be working not on an ‘in-house’ basis but as outside consultants and service-providers. And when we look more closely at particular functions undertaken by the revamped state services there are examples of apparently better performance than in the past, but equally there have over recent years been quite a numbers of well-publicized cases of poor performance. So is it possible to conclude that the New Zealand taxpayer now gets much better value for money than was the case under the old public service?