Reform and the (not so) new role of stewardship

This is a re-posting of a blog I wrote for the good people over at Power to Persuade

The Victorian government recently announced a new reform agenda to develop a ‘public sector that delivers exceptional outcomes for Victorians…[and] set out a new way of thinking about how government works, all the way from strategy to service delivery’.  This will be achieved through a focus on four areas (outcomes, systems, people and accountability) which are interconnected around the improvement of government and delivery of ‘public purpose’.

The case for change includes some of the more well-rehearsed factors (e.g. demographic, digital, environmental shifts) and also the re-emergence of others (e.g. corruption).  Perhaps, though, the most significant driver outlined in the report is that of the changing nature of government.  The argument goes that over the past few decades we have seen a gradual erosion of the volume of direct service delivery that government does, as a range of different activities and functions are delivered by third party agents (either commercial or community sector organisations) under contract.  We have reached a point in time where this shift is such that government is no longer principally a direct deliverer of public services and instead has moved to being a designer, manager and steward of systems.

Use of this kind of language stretches well beyond Victoria and can be found in Australia and beyond.  The Productivity Commission published their preliminary findings into their human services review this week, where they argue that the role of government should be principally concerned with stewardship.  As this review describes, ‘Stewardship encompasses almost every aspect of system design, including identifying policy priorities and intended outcomes, designing models of service provision and ensuring that services meet standards of quality, accessibility and suitability for users’.  We have also seen the creation of ‘commissioning-only’ organisations in health, Primary Health Networks.  PHNs have been charged with ‘increasing the efficient and effectiveness of medical services for patients and improving the coordination of care to ensure ‘the patient receives the right care in the right place at the right time’.

In response to this agenda, there has been great interest in overseas experience of ‘commissioning’ and the types of factors that are important in driving this.  New South Wales recently establishing a Commissioning and Contestability Unit to help drive similar kinds of reform processes as we see in the Victorian reform document.  However, the terminology of commissioning has fallen out of favour in Victoria over the last 18 months, with some equating this to a greater push for outsourcing and the externalisation of services.  As such, the activity of systems steward seems to be (for the moment at least) a more politically palatable concept in Victoria.

What is interesting about this flurry of language for the ‘new’ role of government is that it isn’t really all that new.  This is because stewardship has always been an important role for government and also because it represents the zenith of public management reforms that started in the 1980s.

Stewardship is arguably the reason we have governments at all.  The World Health Organisation quite nicely encapsulates this in describing stewardship as a ‘political process that involves competing influences and demands’.  But if it is the case that stewardship has always been around then why has it become so popular of late?

The argument goes that with the creation welfare states and expansion of public services in developed counties, public services have become overly focused on the delivery services and often in rather separate silos.  As a result, services lack integration and duplication of efforts is rife.  Moreover, workforces have developed around the services and we lack appropriate strategic workforce planning.  The philosophy of New Public Management encouraged governments to divest themselves of the responsibility of service delivery and, in the words of Osborne and Gaebler, ‘focus on steering and not rowing’.  The implication here was that it doesn’t really matter who does the service delivery, providing the strategy and the leadership of the system is right.

As the Productivity Commission’s interim findings indicate, there are potential challenges with this approach.  Contracting out services does not always lead to more coordinated services and the most vulnerable are particularly at risk in terms of poor services, failure of services or inability to exercise choice and move between providers.  While some would point to this being an indication that outsourcing doesn’t work, those more sympathetic to such an approach would likely point out that the problem resides less with the idea and more with the execution.  While many governments succeeded in doing less rowing, it has been suggested that some have failed to effectively focus on the steering – the strategy piece.  That is, governments have only focused on one piece of the puzzle (supply-side), to the detriment of the demand part of the equation.

We might therefore see this ‘new’ turn in government as less of a dramatic shift and more of an extension of the previous reform agenda.  Indeed, although the Productivity Commission’s recent report acknowledges the limitations of market-based reforms in human services, it goes on to identify six areas that are in need of more competition (or at least contestability).

Without some fairly fundamental reform, the ‘new’ world of stewardship is likely to be a case of plus ça change.

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