Part 4: Putting ideas and plans into action

Reflections from our audits: Our future needs - is the public sector ready?

A good clear strategy makes a big difference

Public entities with a clear purpose, working proactively to achieve that purpose, ware better placed to consider New Zealand's future needs and are more likely to be confident that they can contribute to meeting those needs.

We saw plenty of examples of well-founded strategies – for example, our report on enforcing drink-driving laws found that the Police have a clear national strategy that Police officers understand well.

In the Department of Corrections' work to reduce reoffending by 25% by 2017, we found that early results are encouraging. Between 2011 and 2013, the reoffending rate reduced from 30.1% to 26.6%. The Department has clearly defined what it wants to achieve and has carried out structural changes within the organisation to put it in a better position to reduce reoffending. It has a clear strategy that staff understand, and the reduced reoffending target has unified effort throughout the Department.

A strategic plan is only as good as how well it is put into effect.

Sometimes, we reported on the effect of a lack of strategic approach. In our report, Immigration New Zealand: Supporting new migrants to settle and work, we noted that the lack of a whole-of-government settlement structure has limited achieving some intended results, such as tackling the difficulty for partners of immigrants to get employment.

Effective strategy implementation is patchy

The future needs of New Zealanders will not be delivered solely by having a good strategy or plan. A strategic plan is only as good as how well it is put into effect. This requires all those who should be involved properly and realistically identifying required resources, devising ways to put the plan into practice, and following up as planned.

Putting a strategy into effect is not a uniformly strong point in our public management system.

Being able to explain why you did something is the essence of accountability and is basic for trust and good administration.

Our reports looking at education for Māori identified that Ka Hikitia, the Ministry of Education's strategy for Māori education, is based on thorough research and has a strong evidence base. Where Ka Hikitia has been given effect, there have been statistically significant gains for Māori students. However, the Ministry's interim evaluation report to Cabinet in 2011 noted that Ka Hikitia had been put into practice more slowly than intended. We also found that failing to communicate the strategy effectively or to work with partners adversely affected putting Ka Hikitia into practice.

The problems and challenges that people and communities will face in the future do not necessarily fall neatly into the current organisational mandates or public sector structures. To effectively prepare for and meet our future needs, public entities need to work together across organisational boundaries, often alongside organisations from outside the public sector, including local communities and iwi.

Planning needs to address risks and worst-case scenarios

We have found that public entities plan mainly for likely events. However, they also need to deliberately and sensibly prepare for potentially catastrophic but unlikely events. Those events can require public entities to administer large and complex initiatives that must be set up quickly.

Being prepared for these types of situation is difficult but possible. Although detailed action planning cannot be done before such an event, public entities can prepare a coherent strategic approach in advance. A disciplined approach is required when responding to these events, particularly when the immediate emergency phase of the event has passed.

The 2010 and 2011 earthquakes in Canterbury are a case in point. Rebuilding Canterbury is a priority for the Government and, with so much public spending involved, I have made it a priority to provide assurance that the recovery is being carried out effectively, efficiently, and appropriately. Our set of three reports – Roles, responsibilities, and funding of public entities after the Canterbury earthquakes, Earthquake Commission: Managing the Canterbury Home Repair Programme, and Effectiveness and efficiency of arrangements to repair pipes and roads in Christchurch – provides ample lessons from the response to these events.

Throughout our work, we see examples of overly optimistic forecasting, without enough focus on what might happen in the future or considering the need for an emergency or escape plan if disaster struck. Various unexpected events and changes have affected public entities in recent years, including the global financial crisis, the Canterbury earthquakes, changes in coal prices, or changes to legislation.

Accountability, including attention to legality, procedural requirements, and record-keeping, should be at the heart of a public entity’s systems and operations

Although specific events and changes may not be predictable, we know that unexpected events will happen and not all will go as hoped. Public entities need to consider how they would respond to an unexpected event, and have "exit strategies" to use in unforeseen circumstances. After a major event and changed circumstances, they need to consider whether original intentions and assumptions remain valid.

The better the information, the better the decisions

Throughout our work, we find the information that public entities use to support decision-making and communicate with service users and the public is of variable quality. Having the right kind of data available is one component in being prepared for the future and getting benefits from opportunities and investments.

Our inquiries into the Mangawhai community wastewater scheme and the decision by Hon Shane Jones to grant citizenship to Mr Yang Liu show that records matter. Being able to explain why you did something is the essence of accountability and is basic for trust and good administration. Accountability, including attention to legality, procedural requirements, and record-keeping, should be at the heart of a public entity's systems and operations.

Understanding and preparing for the effects of an ageing population is important for everybody. We used an international benchmark from the United Nations – the Madrid International Plan of Action on Ageing (the Madrid indicators) – to assess the quality of our information on ageing.

We found that the data needed to report on most of the Madrid indicators was available and that public entities were collecting and reporting most of the data. This means that public entities have, at least, a minimum set of data about demography and older people that they can use.

As public entities look to reuse, combine, and share information, I suggest that they consider some common themes about collecting and reporting data. For example, it would help if public entities reported data using more consistent definitions and groupings (such as consistent age groups).

The new requirement to include a financial strategy in local authorities' 2012-22 long-term plans improved the way that local authorities present financial matters in their long-term plans. This is likely to have helped communities to assess the implications of proposed financial decisions. In Matters arising from the 2012-22 local authority long-term plans, we suggested that local authorities could also explicitly consider the implications of trends, using a wider range of indicators for long-term sustainability of their financial and operational performance.

New ways of working don't change the principles underlying public sector work

Throughout our work, we see that people are exploring new models and relationships to achieve the best value and be as effective as possible. Innovating and adapting are important, but public entities need to continue to respect the underlying principles that established ways of working aim to protect. New ways of working do not eliminate the need to show that public resources are managed appropriately.

In the case of the Mangawhai community wastewater scheme, Kaipara District Council decided that it wanted to explore a public-private partnership (PPP) approach, to keep the debt "off the balance sheet" and to transfer as much risk as possible to the private sector provider.

In my view, this decision took Kaipara District Council out of its depth. The Council followed all the right basic steps when it first went to the market for advisors and put the project to tender, but it did not fully understand the complexity of what it was doing. The early decision to use a PPP approach put too much emphasis on achieving a certain accounting outcome and the transfer of risk, and not enough on value-for-money and affordability. The Council's decision-making about the PPP was also not consistent with the good practice guidance that was then available.

In exploring and introducing new approaches, public entities need to ensure that they get the basics right. These basics include making sure that decision-making and organisational processes are legal, good records are maintained, and personal and sensitive data are protected. In forming new service delivery relationships, public entities should consider the need for public accountability. For example, contractors need to be tied into public sector accountability mechanisms.

page top