Table Of ContentPublic Management and Administration
Also by Owen E. Hughes
AUSTRALIAN POLITICS
AUSTRALIAN POLITICS: Realities in Conflict (with Hugh I. Emy)
INTERGOVERNMENTAL RELATIONS AND PUBLIC POLICY (editor with
Brian Galligan and Cliff Walsh)
WHI1LAM RE-VISITED (editor with Hugh I. Emy and Race Mathews)
Public Management
and Administration
An Introduction
Second Edition
Owen E. Hughes
Published in Great Britain by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG21 6XS and London
Companies and representatives throughout the wor1d
A catalogue record for this book is available from the British Library.
ISBN 978-0-333-74849-7 ISBN 978-1-349-26896-2 (eBook)
DOI 10.1007/978-1-349-26896-2
Published in the United States of America by
ST. MARTIN'S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue, New York, N.Y. 10010
ISBN 978-0-312-21688-7 (clothbound)
ISBN 978-0-312-21776-1 (paperback)
Library of Congress Cataloging-in-Publication Data
Hughes, Owen E.
Public management and administration : an introduction I Owen E.
Hughes. - 2nd ed.
p. cm.
lncludes bibliographical references and index.
ISBN 978-0-312-21688-7 (cloth). -ISBN978-0-312-21776-1 (pbk.)
I. Public administration. I. Title.
JFJ351.H84 1998
351-dc21 98-21078
CIP
© Owen E. Hughes 1994, 1998
First edition 1994
Second edition 1998
All rights reserved. No reproduction, copy or transmission of this publication may be made
without written permission.
No paragraph of this publication may be reproduced, copied or transmitted save with
written permission or in accordance with the provisions of the Copyright, Designs and
Patents Act 1988, or under the terms of any licence permitting limited copying issued by
the Copyright Licensing Agency, 90 Tottenham Court Road, London W1P 9HE.
Any person who does any unauthorised act in relation to this publication rnay be liable to
criminal prosecution and civil claims for darnages.
The author has asserted bis right to be identified as the author of this work in accordance
with the Copyright, Designs and Patents Act 1988.
This book is printed on paper suitable for recycling and made from fully managed and
sustained forest sources.
10 9 8 7 6 5 4 3 2 I
07 06 OS 04 03 02 01 00 99 98
Contents
Preface vi
An Era of Change
2 The Traditional Model of Public Administration 22
3 New Public Management 52
4 The Role of Government 81
5 Public Enterprise 109
6 Public Policy and Policy Analysis 129
7 Strategic Management 149
8 Managing Internal Components 167
9 Managing External Constituencies 189
10 Public Management in Developing Countries 206
11 Politics and the Administration 225
12 Conclusion 242
References 262
Index 272
v
Preface
Since the mid-1980s, the public sectors of Western countries have undergone
major change as governments try to respond to the challenges of technolo
gical change, globalisation and international competitiveness. Recent years
have seen wider-ranging reforms than any other period of the twentieth
century. It is argued that this represents a paradigm shift from the traditional
model of public administration, dominant for most of the century, to
'managerialism' or new public management; the theory of bureaucracy in
its governmental context is being replaced by economic theories and provi
sion by markets.
This book provides an introduction to, and assessment of, the theories and
principles of the new public management and compares and contrasts these
with the traditional model of public administration. The managerial pro
gramme is an international one, with quite similar changes occurring in a
range of different countries. What is more, there is common intellectual
backing for these changes particularly in economic theory and the principles
of private management. For this reason the book concentrates on the broad
sweep of international developments rather than concentrating on individual
national case studies which could obscure key issues in a mass of unnecessary
detail.
The second edition maintains the same essential argument as the first
edition, but updates it in several areas. Events since the writing of the first
edition have shown even more clearly that a major shift has been under way
in the management of the public sectors around the world, although the pace
of change is greater in some countries, for example New Zealand, Australia
and the UK, than in others, such as the US and Germany (Nunberg, 1995,
p. 4). A new chapter has been added to discuss the particular problems of
public management in developing countries and whether new public manage
ment can be as successful there as in more developed OECD countries.
The first part (Chapters 1-3) sets out the competing theories of traditional
public administration and new public management. The two paradigms are
argued to be quite different, resulting in contrasting conceptions of the public
service. The second part (Chapters 4-6) considers the changing role of
government, a change that is, to a large degree, behind the change in
management. This includes discussion of the greatly reduced role of public
enterprise and models of public policy making for government. The third
section (Chapters 7-10) sets out in more detail specific aspects of new public
management - strategic planning and management, managing internal
vi
Preface vii
components and managing external constituencies, as well as management in
developing countries - and the final part (Chapters 11 and 12) looks at
political accountability and the limitations and problems of the new
approach.
In looking at public administration there is a well-established and recog
nised model with a long history and an extensive literature. As it is more
recent, new public management has neither to anywhere near the same
degree. It is, however, here and here to stay. There are likely to be problems
of accountability, morale and ethics in the adoption of new public manage
ment and it is possible some managerial changes will result in little, if any
benefit. There is, however, no reason to assume that the managerial
programme will be dropped and the traditional model adopted again. There
is a major theoretical shift under way affecting the public sector and the
public services, but also with substantial impacts on the relationship between
government, bureaucracy and citizens. As the reform programme progresses
in different countries it appears more evident that the days in which formal
bureaucracy and the traditional model of administration characterised
government management are rapidly passing.
OWEN E. HUGHES
1
An Era of Change
Introduction
Since the mid-1980s there has been a transformation in the management of
the public sectors of advanced countries. The rigid, hierarchical, bureaucratic
form of public administration, which has predominated for most of the
twentieth century, is changing to a flexible, market-based form of public
management. This is not simply a matter of reform or a minor change in
management style, but a change in the role of government in society and the
relationship between government and citizenry. Traditional public adminis
tration has been discredited theoretically and practically, and the adoption of
new public management means the emergence of a new paradigm in the
public sector.
This new paradigm poses a direct challenge to several of what had
previously been regarded as fundamental and almost eternal principles of
public administration. The first of these was that governments should
organise themselves according to the hierarchical, bureaucratic principles
most clearly enunciated in the classic analysis of bureaucracy by the German
sociologist Max Weber. Although adopted by business and other institu
tions, these precepts were carried out far more diligently and for longer in the
public sector. It was assumed that strict adherence to these principles would
provide the single best way of operating an organisation. The second
principle was that, once government involved itself in a policy area, it
became the direct provider of goods and services through the bureaucracy.
Thirdly, it was thought that political and administrative matters could be
separated. The administration would be an instrument to carry out instruc
tions, while any matters of policy or strategy were the preserve of the
political leadership. This was assumed to ensure accountability. Fourthly,
public administration was considered a special form of administration and,
therefore, required a professional bureaucracy, employed for life, with the
ability to serve any political master equally.
All these seeming verities have been challenged. Delivery by bureaucracy is
not the only way to provide government goods and services. Flexible
management systems pioneered by the private sector are being adopted by
1
2 Public Management and Administration
governments. Also, governments can operate indirectly through subsidies,
regulation or contracts, instead of always being the direct provider. More
over, political and administrative matters have in reality been intertwined for
a long time, but the implications of this for management structures are only
now being worked through. The public demands better mechanisms of
accountability where once the bureaucracy operated separately from the
society. The case for unusual employment conditions in the public services is
now much weaker, especially given the changes that have taken place in the
private sector where jobs for life are rare. While all these points deserve
greater discussion, the main point is there has been total change in a
profession that saw little change for most of the century.
By the beginning of the 1990s, a new model of public sector management
was emerging in most advanced countries (Farnham and Horton, 1996). The
new model has several incarnations, including: 'managerialism' (Pollitt,
1993); 'new public management' (Hood, 1991); 'market-based public admin
istration' (Lan, Zhiyong and Rosenbloom, 1992); the 'post-bureaucratic
paradigm' (Barzelay, 1992) or 'entrepreneurial government' (Osborne and
Gaebler, 1992). Despite the differing names, these essentially describe the
same phenomenon. Rhodes, drawing from Hood (1991), saw manageria1ism
in Britain as a 'determined effort to implement the "3Es" of economy,
efficiency and effectiveness at all levels of British government' and argued
(1991, p. 1):
The 'new public management' has the following central doctrines: a focus on
management, not policy, and on performance appraisal and efficiency; the
disaggregation of public bureaucracies into agencies which deal with each other
on a user-pay basis; the use of quasi-markets and contracting out to foster
competition; cost-cutting; and a style of management which emphasises, amongst
other things, output targets, limited-term contracts, monetary incentives and
freedom to manage.
This view largely focuses inside the organisation and implies that substantial
changes are required, especially for personnel, but does point to some of the
main features of new public management.
A more positive perspective is that of Osborne and Gaebler in the United
States deriving from their view that government needs to be 'reinvented'. The
authors claim that they believe in government and that government can do
much which markets cannot. However, they claim that bureaucracy is
neither necessary nor efficient and that other means should be used. They
set out a ten-point programme for what they term entrepreneurial govern
ments (Osborne and Gaebler, 1992, p. 20):
Most entrepreneurial governments promote competition between service providers.
They empower citizens by pushing control out of the bureaucracy, into the
community. They measure the performance of their agencies, focusing not on
