Procurement and performance in the public sector: A study in the context of the New Zealand community probation service (2002)
AuthorsCampbell, Lesley Margaretshow all
The theoretical discourses emanating from private sector management and the new institutional economics were influential in shaping the worldwide reforms of the public sector. In New Zealand's public management reforms, for instance, the pervasive adoption of market mechanisms, such as contracting and competition, were a significant feature. While proponents argue that competition and the agency relationship inherent in contracting enhance the 'achievement of results,' other commentators in the literature state that this argument is merely ideological in nature and that there is little empirical evidence to support it. Within the context of these literary positions, the present research sought to examine the extent to which management by contract and competition foster the achievement of performance for the stakeholders concerned with the provision of indirect, rehabilitative services for offenders. In order to explore this issue the study drew on the conceptual framework of programme logic to fully canvass the multitude of factors that might impact on the proficiency of these two instruments of government in achieving results. This framework guided the design of the survey questionnaires. In addition, a qualitative approach was selected, not only because it seemed to have the potential to expose the complexity of factors influencing performance within the various components of contracting, but also because it has the potential to reveal nuances within responses and diversities of opinion. The data challenge the ideological position that there is a link between contracting and competition and the achievement of performance. Instead, the results confirm the theoretical position that the problem of asymmetric information in agency theory exists in the contracting relationship under examination, and because of this there is uncertainty about whether these indirect services contribute to the public purpose. Moreover, an outcome-focused performance management system was not integrated into the implementation of the contractual framework. The pre-contract assessment was not guided by evidence-based standards, an understanding of the intervention logic between services purchased and outcomes sought, or monitoring data - strategies with which to counter the problem of adverse selection. Contract monitoring procedures failed to include a mechanism with which to confirm the integrity with which indirect services were delivered; and, performance indicators were neither comprehensive nor reliable, valid and of a comparative nature - strategies with which to counter the problem of moral hazard. Additionally, the results suggest that an output-focused procurement system restrains the adoption of developmental approaches to contracting; precludes an emphasis on the capacity and capability of those involved in the contractual relationships; and, fosters a 'silo' mentality across government sectors which seems to impact on the efficacy with which the public sector addresses client needs in a responsive manner. Interestingly, the results point to other factors that may be pertinent to the achievement of results. These factors include level of organizational development; staff's professional commitment and motivation to contribute to the public good; and, contractual relationships that are collaborative, enduring and involve implicit understandings. In all, these findings suggest that a review of public sector policies and practices associated with the implementation of procurement practices is warranted; and such a review seems all the more imperative in the correctional context where public safety could well be compromised.