Peter Nicholl
My column two weeks ago was about the accountability, or more accurately lack of accountability, of the Reserve Bank of New Zealand for its poor performance over the last several years.
Peter Nicholl
It was only after I submitted my column that I realised that this problem is much more wide-spread in New Zealand. The lack of accountability has become a weakness almost everywhere in the public sector
If a private sector organisation fails the accountabilty test it disappears – it goes bankrupt.
In the year ended December 31, 2867 New Zealand companies were placed in liquidation, the highest for 15 years. There is nothing equivalent in the public sector. I remember a governor of the Central Bank of Ireland saying at a conference “there is no end to the ingenuity of politicians and public servants when it comes to spending someone else’s money”.
New Zealand tried to set up an accountability model similar to the private sector in our public sector back in the 1990s. Most government operating agencies were set up as state-owned corporations with their own capital and their own board. The heads of government departments were put on term contracts with detailed performance criteria.
This structure was good and the performance of many State Owned Enterprises and other public sector organisations improved significantly.
This model for trying to introduce private-sector accounbtabilty mechanisms to the public sector gained a lot of global attention. I was asked to give speeches about it in many countries overseas.
What a long way we have fallen. I was out of New Zealand from 1995 to 2015. I don’t know how the clarity and strength of the public sector accountability processes New Zealand had back in the 1990s got lost – but lost they certainly are.
Examples of poorly-performing public sector agencies are everywhere today. Examples of organisations or individuals being held accountable for those failures are hard to find. The usual first response is to make excuses. If the failure was a big one the second response is often so set-up a commission of enquiry. The main recommendation from most of these enquiries is often restructuring. Does that work? Of course not. The problems are almost always ones of attitude, incentives, focus and a lack of clear accountabality. In other words, they are personnel issues not issues of structure.
I have also been reminded of the vagueness that we now seem to have in New Zealand about accountability by the initial responses to the terrible recent event in Mt Maunganui.
Several organisations, including the Tauranga City Council, have said they are going to set up inquiry bodies to find out who is responsible and accountable for what happened. They do need to have an inquiry to find out what went wrong but if they don’t know in advance what the responsibilities of the various agencies and people involved were, that suggests that the real problem was we no longer seem to have a clear idea of who is responsible and accountable.