Part 2: The arguments for change
2.1
In our first paper on public accountability, we described how public accountability systems have evolved over time.
2.2
In this Part we discuss the case for further change. We describe some of the reforms that are proposed or under way, and explore the implications for the public sector.
Increasing public expectations of the public sector
2.3
For Parliament to represent the public in holding the Government to account, it needs to understand what is relevant and important to the public. Therefore, effective public accountability needs to start with an understanding of the public's expectations of the public sector.
2.4
Members of the public are not just users of public services. As taxpayers or ratepayers, they all have an ownership interest in public resources. This was well described by Te Kawa Mataaho in the title of its 2018 discussion document on the reform of the State Sector Act 1988: New Zealand's Public Service Belongs To You, The People of New Zealand.
2.5
Changes in technology, global challenges (such as climate change), and a diverse society are all affecting the public's expectations of the public sector. Many public organisations are already aware of these ongoing changes. For example, Local Government New Zealand, in its discussion paper on local government funding, said that New Zealand faces:
… changing demographic and economic growth, increasing public expectations as well as evolving and new environmental challenges.13
2.6
This situation is neither new nor unique to New Zealand and has existed for some time. For example, in 2010, an introduction to an Organisation for Economic Co-operation and Development panel about regaining citizens' trust observed that "growing complexity and citizen expectations are increasing demands on government".14
2.7
To understand the public's expectations of the public sector, we carried out various focus groups with people of different ages and cultures, and from different regions. We also carried out a nationwide survey of 1000 participants aged 18 and older.
2.8
Of the people surveyed, 86% believed it was important for public organisations to be directly accountable to the public, and 53% were "interested" or "very interested" in learning more about what the public sector did. Many people thought that public accountability was important to building trust in the public sector. For example, one person said, "being accountable is helping us trust in our own public system". Another person said that "public accountability helped improve New Zealand's global reputation as a strong democracy".
2.9
Some of those surveyed also emphasised that, in order to be publicly accountable, the public sector needs to:
- understand what is important to people; and
- take responsibility for its actions.
2.10
We were told that understanding what is important to people involves engaging with, listening, and responding to their needs. For example, one person said, "I want to be heard at least … it is about doing the right things, but also giving people a voice".
2.11
For our survey respondents, taking responsibility meant owning up, rectifying mistakes, initiating follow-up actions, and not passing the blame.
2.12
Some of those surveyed said that public accountability information needs to consider the diversity of their communities. The survey asked people about the expectations they had of the public sector and the services provided to them. Figure 3 categorises the responses by demographic group. Acting with integrity was important for people aged 40 to 65 years old. Being listened to was important for Māori. Environmental concerns, greater focus on health outcomes, and having enough resources to provide better services were important for people aged 20 to 35 years old.
Figure 3
The range of expectations about the public sector from different demographic groups
| Demographic | Key expectations (unprompted) |
|---|---|
| 20 to 35 year olds | Accountability: evidence on how the money is spent, focus on benefit and outcomes, cost-effective; transparent (amount of money spent), and being open. |
| Efficient: move faster on small changes to improve services, government processes are limiting. | |
| Communication: feedback on services and changes, provide information, easy to interpret, clear, keep it simple, and good communication. | |
| Environmental concerns: more focus on improving the environment. | |
| Health: more focus on cancer treatment and access to drugs. | |
| Resources: to enable better services. | |
| New migrants | Accountability: evidence on how the money is spent, focus on benefit and outcomes, cost-effective; transparent (amount of money spent), and being open. |
| Service performance: following through/responsive/timely, easy to access, address wait times and call backs, know where you are in the queue, and easy to use. | |
| Efficient: move faster on small changes to improve services, government processes are limiting. | |
| People-focused: empathetic and understanding. Be proactive, know the public better. | |
| Māori | Accountability: evidence on how the money is spent, focus on benefit and outcomes, cost-effective; transparent (amount of money spent), and being open. |
| Service performance: following through/responsive/timely, easy to access, address wait times and call backs, know where you are in the queue, and easy to use. | |
| Communication: feedback on services and changes, provide information, easy to interpret, clear, keep it simple, and good communication. | |
| People-focused: empathetic and understanding. Be proactive, know the public better. | |
| Honest: acting with integrity. | |
| Listen to the people: do not make assumptions, be taken seriously, and do not be bullied into making decisions. | |
| 40 to 65 year olds | Service performance: following through/responsive/timely, easy to access, address wait times and call backs, know where you are in the queue, and easy to use. |
| Communication: feedback on services and changes, provide information, easy to interpret, clear, keep it simple, and good communication. | |
| Honest: acting with integrity. |
2.13
Many respondents were interested in learning more about services the public sector delivered and how money was spent in their community. However, information about these services needed to be relevant, convenient, easily found, and accessible. For example, one person said:
Providing information is really important. Making it simple to understand and not because they think people are dumb or anything but at the end of the day if they are using special terminology it will just put people off. You look at it and think I don't understand what it means and walk away.
2.14
The matters that people talked about also support our view that, for the public, public sector performance is important, but it does not meet all the public's expectations. Not only does the public expect the public sector to provide services in an efficient, reliable, and responsive way, but it should also act, and be seen to act, with respect, integrity, openness, and honesty. For example, one person said:
… [a]ccountability isn't just that you have told me you are going to do something and you do it, but it is [also about] looking after the interests of everybody who relies on that service.
2.15
When asked how public organisations could better communicate what they do, the top two responses were to use a one-stop government website and national and local newspapers. Out of seven possible ways that public organisations could communicate what they do, annual reports were at the bottom of the list – only 29% of respondents said that annual reports were useful.15
2.16
Overall, the findings from the survey suggest the public does believe public accountability is important and they want the public sector to understand what is important to them.
Changes in the public sector and proposed reform
2.17
In the 1980s, many saw public organisations as inefficient, unresponsive, and increasingly ineffective. Therefore, the Government introduced major reforms to increase the financial control and performance of public organisations. Researchers have described these reforms as having a particular focus on competently managing public resources with economy and efficiency as a criteria of success instead of other factors, such as honesty, fairness, reliability, and resilience.16
2.18
It is generally accepted that these reforms have served the public sector well in the last few decades. However, the public sector is increasingly facing new and different challenges and opportunities, many of which require a long-term, integrated, and collective response.
2.19
Many of these challenges and opportunities are already here, including a changing natural environment, a more diverse and connected society, and the need to continue strengthening the relationship between Māori and the Crown. People we interviewed mentioned these challenges as well as others, including an ageing population, mental health issues, inequalities and inequities, support for immigrant communities, and managing scientific innovation.
2.20
In response to these complex and long-term challenges, various reforms and other changes are shifting the way the public service and public sector think and operate. We summarise some of these changes below.
The Public Service Act 2020
2.21
The new Public Service Act promotes a modern public service that is more joined-up and citizen-focused. Acting with a spirit of service to the community is one of the central objectives of the Act. As Te Kawa Mataaho states, "[s]imply put, it means placing New Zealand and New Zealanders at the front and centre of how we in the Public Service think, organise ourselves, and operate".17
2.22
Supporting this objective, section 14 of the Public Service Act requires the public service to take responsibility for developing and maintaining its capability to engage with Māori and to understand Māori perspectives. Section 12 also requires the public service to proactively promote the stewardship of its long-term capability, assets, information, and systems. As Ayto has previously observed, a:
… stewardship responsibility sends a signal that departments can no longer just be passive, working only on those matters that their minister has deemed to be of interest or priority… [they must also] … ensure New Zealanders obtain the best long-term benefit from the resources or assets for which they are stewards.18
2.23
In line with the principle of stewardship, Schedule 6 of the Public Service Act requires periodic and publicly available "insight briefings" about long-term trends, risks, opportunities, and policy options. Schedule 3 also requires regular briefings on the state of the public service. This might include how well the public service is promoting stewardship and acting with integrity (with workforce diversity and inclusiveness in mind). These briefings and the information within them reflect some of the wider and different attributes of public service success that are increasingly important to a modern public service focused on intergenerational well-being.
2.24
Boston, Bagnall, and Barry recognise this shift in the focus of the public sector and make the observation that "if Parliament is to scrutinise the performance of the executive, assessing departmental stewardship in its various forms must be a core feature of such oversight".19
Public finance modernisation
2.25
The Treasury believes that a stewardship approach to the public finance system is necessary to support New Zealanders' intergenerational well-being through a more modern, agile, and joined-up public sector.20 Talking about this new focus and what the Treasury is working on to modernise the public finance system, the Minister of Finance, Grant Robertson, highlighted three areas of focus:21
- Changing the framework for measuring success and embedding well-being as a priority across the public sector.
- Changing the financial management framework to increase flexibility, encourage collaboration, and support and enable a more strategic focus – including changes to the appropriation system and a different approach to planning and reporting.
- Rethinking the approach to the Budget to focus on existing as well as new spending and the challenges and trade-offs needed to improve well-being for the public.
The review of Parliament's standing orders
2.26
Parliament's Standing Orders Committee recently reviewed Parliament's processes, procedures, and practices and published a report of the review. The recommendations and amendments from the report, in part, reflect practices that developed during the initial response to Covid-19 and a desire for Parliament to maintain its "legitimacy in the eyes of the public".22 There is a general focus throughout the report on encouraging more public understanding, engagement, and input into parliamentary processes and activities.23
2.27
The report recommended several changes to Parliament's rules and practices. These changes increase expectations for Ministers to be held to account by Parliament and select committees24 – for example, select committees now scrutinise sectors as well as individual public organisations. The report also recommends encouraging alternative engagement practices that can reach a wider range of New Zealanders and gather more relevant information through, for example, surveys. A Petitions Committee was established to deal more effectively with public requests for Parliament's consideration of matters that are important to them.25
2.28
The House of Representatives adopted the amendments and recommendations of the Standing Orders Committee. The recommendations came into effect with the dissolution of Parliament in September 2020.
The 2019 amendments to the Local Government Act 2002
2.29
The 2019 amendments to the Local Government Act 2002 reinstated a focus on community well-being for council decision-making, planning, and reporting. Councils must consider the four aspects of well-being (economic, social, cultural, and environmental) when making decisions and planning about how their activities will contribute to the desired outcomes for their communities.26
2.30
Councils' long-term plans have to describe the outcomes they seek for their community, how their activities will contribute to these outcomes, and any significant negative effects their activities will have on well-being. Their annual reports must identify any positive or negative effects of their activities on well-being.
Other reforms
2.31
Other opportunities for change could include the reforms under way to help improve water service delivery, the management of natural resources, the provision of tertiary education, and the health and disability system.
The implications of these changes
2.32
The full implications of these changes remain to be seen. However, it is likely that they will affect many of the relationships, objectives, and information that underpin effective public accountability.
2.33
Many of the challenges and opportunities that the public sector faces will directly affect the well-being of communities. As a result, communities will increasingly need to become contributors to, and co-owners of, solutions or responses.
2.34
Recent research into Italy's response to Covid-19 supports this view. The research identified five different stages of accountability as Covid-19 progressed. During the early stages of Covid-19, the Italian government was responsible and accountable for the response. During the last two stages, citizens became more responsible. This greater sense of "shared responsibility" was an important part of managing the longer-term effects of the pandemic.27
2.35
Initiatives such as the Policy Project28 are already encouraging better engagement with communities when designing and developing policies. There are also plans under way to enable central government agencies to work in a more joined-up way to support regional and local government priorities (see Part 4). Many of these priorities are aimed at meeting the needs of more diverse and changing communities.29
2.36
Some public organisations are already working to maintain longer-term and more trusting relationships with their communities. For example, the New Zealand Qualifications Authority is collaborating with iwi and with other education organisations to focus on Māori and Pacific students achieving equitable outcomes in STEM-related30 NCEA (National Certificates of Educational Achievement) subjects.31
2.37
The New Zealand Qualifications Authority told us this means co-designing initiatives and solutions that meet the needs of iwi. Close engagement is the first step to understanding iwi aspirations and expectations. Information is then shared to assist them in developing solutions and responses that support what they want to achieve for their whānau. As part of maintaining a longer-term trusting relationship, the New Zealand Qualifications Authority is accountable to both the Ministry of Education and the iwi it is partnering with for this initiative.
2.38
New types of working arrangements in the public sector will also require new accountability approaches. The Cabinet paper establishing the joint venture to reduce family violence and sexual violence discussed what success would look like for the joint venture. To be successful, it was noted that the joint venture would need strategic leadership, sustained commitment, a collaborative mandate and function, an integrated approach to contracting and service delivery, a citizen focus, responsiveness to family and whānau needs, and to partner with communities and be accountable to the public and Parliament.32
2.39
For public organisations seeking to achieve positive wellbeing outcomes, being accountable for their achievement is as much about demonstrating how collaborative, forward thinking, citizen focused, and inclusive an organisation is, as it is about the economy, efficiency, and effectiveness of delivery.
2.40
In the next Part, we discuss what people working in the public sector told us about how well the public accountability system operates in practice.
13: Local Government New Zealand (2015), Local government funding review: A discussion paper, Wellington, page 76.
14: Organisation for Economic Co-operation and Development (2010), Towards recovery and partnership with citizens: The call for innovative and open government, page 34.
15: The other ways included social media, organisation websites, face-to-face communication, and information at local community libraries and venues.
16: Hood, C (1991), "A public management for all seasons?", Public Administration, Vol. 69, pages 11, 12, and 15. Brown, P (2021), "Public Value Measurement vs. Public Value Creating Imagination – the constraining Influence of Old and New Public Management Paradigms" International Journal of Public Administration, pages 1,2, and 8.
17: State Services Commission (2017), The Spirit of Service: Briefing to the Incoming Government, page 2.
18: Ayto, J (2014), "Why departments need to be regulatory stewards", Policy Quarterly, Vol. 10, Issue 4, page 27.
19: Boston, J, Bagnall, D, and Barry, A (2019), Foresight, insight and oversight: Enhancing long-term governance through better parliamentary scrutiny, Institute for Governance and Policy Studies, Victoria University of Wellington, page 23.
20: See speech from Struan Little (2018), "Taking a Stewardship Approach to the Public Finance System", at treasury.govt.nz.
21: See speech from Grant Robertson (2019), "Bringing Wellbeing into the Public Finance Act", at www.beehive.govt.nz. Some of these points were also reinforced in a speech by Grant Robertson on 18 February 2021 to the Institute of Public Administration New Zealand, at www.ipanz.org.nz.
22: Standing Orders Committee (2020), Review of Standing Orders 2020: Report of the Standing Orders Committee, pages 4 and 5, at parliament.nz.
23: Standing Orders Committee (2020), Review of Standing Orders 2020: Report of the Standing Orders Committee, pages 21, 23, 26, 29, 30 ,44, 45, 48, and 54, at parliament.nz.
24: Standing Orders Committee (2020), Review of Standing Orders 2020: Report of the Standing Orders Committee, pages 24, 40, 43, and 44, at parliament.nz.
25: Standing Orders Committee (2020), Review of Standing Orders 2020: Report of the Standing Orders Committee, pages 29, 30, and 48, at parliament.nz.
26: See Controller and Auditor-General (2020), Insights into local government: 2019 and Part 1 of the Local Government (Community Well-being) Amendment Act 2019.
27: Andreaus M, Rinaldi L, Pesci C, Girardi A (2021), "Accountability in times of exception: an exploratory study of account-giving practices during the early stages of the COVID-19 pandemic in Italy", Journal of Public Budgeting, Accounting & Financial, Management (ahead of print), at Part 5.
28: The Policy Project is an initiative from the Department of the Prime Minister and Cabinet that seeks to promote good policy design and development across government.
29: Cabinet paper (June 2019), to the Cabinet Government Administration and Expenditure Review Committee Joined-up approach to the regional arm of government, at publicservice.govt.nz.
30: STEM stands for science, technology, engineering, and mathematics.
31: New Zealand Qualifications Authority (2020) Te Kōkiritanga 2020–2023.
32: Cabinet paper (September 2018) Leadership of Government's collective efforts to reduce family violence and sexual violence, pages 5 and 16, at justice.govt.nz.