Improving Public Sector Efficiency
ISSN 1608-7143 OECD Journal on Budgeting Volume 7 – No. 1 © OECD 2007
Improving Public Sector Efficiency: Challenges and Opportunities by Teresa Curristine, Zsuzsanna Lonti and Isabelle Joumard*
This article examines key institutional drivers that may contribute to improving public sector efficiency and focuses on one of them in more detail: performance information and its role and use in the budget process (“performance budgeting”).
* Teresa Curristine is a Policy Analyst in the Public Governance and Territorial Development Directorate of the OECD. Zsuzsanna Lonti is a visiting academic in the same directorate. Isabelle Joumard is a Senior Economist in the Economics Department of the OECD. This article was produced for the German Presidency of the European Union.
1
IMPROVING PUBLIC SECTOR EFFICIENCY: CHALLENGES AND OPPORTUNITIES
Executive summary
Governments of OECD countries are under pressure to improve public sector performance and at the same time contain expenditure growth. While factors such as ageing populations and increasing health care and pension costs add to budgetary pressures, citizens are demanding that governments be made more accountable for what they achieve with taxpayers’ money. This article briefly reviews key institutional drivers that may contribute to improve public sector efficiency, and focuses on one of them in more detail: performance information and its role and use in the budget process. There is no blueprint for enhancing public sector efficiency. OECD countries have thus adopted diverse approaches to reforming key institutional arrangements, which include: increasing devolution and decentralisation; strengthening competitive pressures; transforming workforce structure, size, and HRM arrangements; changing budget practices and procedures; and introducing results-oriented approaches to budgeting and management. Although the majority of OECD countries have engaged in some institutional reforms, the empirical
Improving Public Sector Efficiency: Challenges and Opportunities by Teresa Curristine, Zsuzsanna Lonti and Isabelle Joumard*
This article examines key institutional drivers that may contribute to improving public sector efficiency and focuses on one of them in more detail: performance information and its role and use in the budget process (“performance budgeting”).
* Teresa Curristine is a Policy Analyst in the Public Governance and Territorial Development Directorate of the OECD. Zsuzsanna Lonti is a visiting academic in the same directorate. Isabelle Joumard is a Senior Economist in the Economics Department of the OECD. This article was produced for the German Presidency of the European Union.
1
IMPROVING PUBLIC SECTOR EFFICIENCY: CHALLENGES AND OPPORTUNITIES
Executive summary
Governments of OECD countries are under pressure to improve public sector performance and at the same time contain expenditure growth. While factors such as ageing populations and increasing health care and pension costs add to budgetary pressures, citizens are demanding that governments be made more accountable for what they achieve with taxpayers’ money. This article briefly reviews key institutional drivers that may contribute to improve public sector efficiency, and focuses on one of them in more detail: performance information and its role and use in the budget process. There is no blueprint for enhancing public sector efficiency. OECD countries have thus adopted diverse approaches to reforming key institutional arrangements, which include: increasing devolution and decentralisation; strengthening competitive pressures; transforming workforce structure, size, and HRM arrangements; changing budget practices and procedures; and introducing results-oriented approaches to budgeting and management. Although the majority of OECD countries have engaged in some institutional reforms, the empirical
References: IMPROVING PUBLIC SECTOR EFFICIENCY: CHALLENGES AND OPPORTUNITIES Gilmour, John and David Lewis (2006), “Does Performance Budgeting Work? An Examination of the Office of Management and Budget’s PART Scores”, Public Administration Review, 66(5), pp IMPROVING PUBLIC SECTOR EFFICIENCY: CHALLENGES AND OPPORTUNITIES OECD (2005c), Reallocation: The Role of Budget Institutions, OECD Publishing, Paris