Creative Bureaucracies Summary

This is my summary of the course Creative Bureaucracies, one of the core classes at the UCL Institute for Innovation and Public Purpose’s MPA in Innovation, Public Policy and Public Value.

Photo by Isaac N.C. on Unsplash

Summary

• We need to rethink the welfare state, not just rework our current systems to address modern problems;
• Policy responses to the coronavirus need to learn from what happened in 2008. Any support we provide firms needs to have conditions attached (e.g. limiting share buybacks, dividend payments and executive pay) so that they create jobs and invest in the ‘real economy’. We should not silo economic growth, social welfare reform, and our response to the coronavirus;
• Smart cities need to give citizens a say in how the tech infrastructure in the city operates and what ends it serves;
• Alternatives to western public administration exist, including Chinese/Confucian, Islamic, and Buddhist approaches; across these systems some principles are universal, some are generally valid, but need to be adapted to the context, and a third set work well in a given system but not another; and
• We need to move beyond the dichotomy of using the public or the private sector to deliver government services; depending on the relationship the service has with the people (citizen, client or customer), it might be preferable to have a cooperative or non-owned organization involved.

The welfare state

Many parts of our welfare systems (e.g. Job Centres) look the same today as when they were conceived in the 1940s. However, the economy and society are drastically different 80 years on. New social challenges are different in nature and require new types of responses. For instance, women’s workforce participation means that childcare and eldercare are no longer domestic issues. And poverty has changed shape, where the majority of poor people are ‘working poor’.

The welfare state can catch us when we fall but cannot launch us into flight. It also doesn’t flex easily in times of crisis that require coordination between different services (e.g. Grenfell Tower). What welfare reforms have occurred, have only marketised old structures, making it more arm’s length and transactional. We need to rethink how social services are delivered, making them less top-down, and more humane and community led. You cannot scale every community led solution, and that’s ok.

Four principles for a modern welfare system include: (1) create capability, not manage dependence; (2) open when we need help and when we don’t need it help us give help; (3) create possibility, not just manage risk; and (4) include everyone.

See my blog on reforming the welfare state here

Responding to the coronavirus

The coronavirus is a huge opportunity that shouldn’t be lost. In 2008, governments just invested into the financial system and not the real economy. We should not silo economic growth, social welfare reform, and our response to the coronavirus. Some policy responses include:

1. Unleash a smart, green, healthy deal with a mission oriented approach (see this summary for more on missions). This requires outcomes oriented policies that use industrial strategies, infrastructure investment, procurement, and more, to improve the health system, boost care infrastructure, and address other problems in the economy. This is an important intersectional moment between welfare and capitalism;
2. Strengthen the NHS and council run services by listening to people on the ground. This isn’t just about money, but management structures that allow communities to better respond to their unique challenges. This could include giving assets and budgets to communities so that they can work in a horizontal way and grow social networks;
3. Offer income support to workers so that they can get out of debt early and start to spend, which will get the economy rolling again. To do this, consider using debt relief, wage subsidies, or potentially universal basic income;
4. This crisis is really bringing to light gaps in the social welfare system, especially support for the gig economy and people working below a living wage. This is an opportunity to improve our welfare system going forward;
5. Provide firms with immediate cash flow but make sure not to give handouts without conditions attached — e.g. green restructuring in the long term, investing in the workforce and paying living wages, retaining jobs, limiting share buybacks/dividends/exec payments, retaining collective bargaining, reducing material inputs, etc. — and have executives face criminal penalties if they don’t adhere to the rules their companies agree to. We also need to allow some creative destruction, and not fund uncompetitive firms. The tricky questions are what businesses do you bailout and how can we ensure this money trickles down to employees?
6. Rethink the role of central banks, which can use quantitative easing to direct investment where we need it — e.g. social care, the green economy, etc.
7. We need to make sure that governments receive returns for their investments if they lead to a cure for the coronavirus. We cannot let the private sector charge an arm and a leg for a cure, particularly if the public sector is involved in the process.

One cautionary note is to be careful in the face of crises to not give up too many of our data or digital rights that can’t be taken back afterwards.

Smart cities

The term ‘smart city’ doesn’t have a single definition but generally involves the deployment of clever, real-time devices in a city. However, we need to broaden the discussion and not just talk about smart cities, but smart, equitable, democratic cities. There are two kinds of smart cities: (1) computational, private driven, tech-first ones; and (2) rebel cities with bottom-up solutions that use technology to meet citizens’ needs.

Proponents of smart cities believe that: they can use technology to achieve universally accepted political goals, like economic growth or better services for citizens; pragmatically, they save money or can increase security; and they can solve city-specific problems, like congestion.

At the same time, some critics say that smart cities: represent a commodification of solutions to social problems; hand over the management of public infrastructure and services to firms, decentralizing and depersonalizing the political sphere; are a technocratic quest for domination over everyday urban existence; and show an obsession with surveillance and control.

Regardless, smart cities can play a huge role in tackling some of the world’s biggest problems because cities are closer than national governments to the sources of climate change, inequality, housing affordability etc.

To regain control, cities should create tech sovereignty, giving citizens a say in how the tech infrastructure in the city operates and what ends it serves. This requires taking back critical knowledge, data and infrastructure from big tech firms, and ending the privatisation of public services. To achieve this, alternative models exist for data ownership, grassroots innovation and co-operative service provision. Cities need digital standards, ethical frameworks, tech codes of conduct, and data strategies. Cities could also use their procurement power to ask for their data back in machine readable formats from businesses they engage with. Cities can come together in co-op models to develop new services or alternative infrastructure in open source ways.

For examples of smart cities that follows these principles, see Barcelona en Comú, or C40 Cities — a platform for cities to share best practices.

Innovation and the public service

Innovation in the public and private sectors are different in nature and impact. The private sector talks about first mover advantage, competition, externalities, etc., but these are less evident in the public sector — and may not be desirable. Governments don’t profit or require innovation for a competitive advantage, so they have no need to innovate or move fast and break things. Innovation is unpredictable but government should be predictable. Therefore, innovation is hard to do in the civil service. Innovation is innately political because it comes down to a set of moral choices. We need to think about how our bureaucratic institutions can be innovative and adapt to big changes in society and the economy.

Politicians with four/five year mandates often struggle working with the slower, long-term minded civil service. Regardless of the political priorities, civil servants need to be neutral in what they implement, while still speaking truth to power. With market shaping policies, this becomes tricky because civil servants may need to deliver on things they might not believe in.

Models of government

New Public Management (NPM) originated in the 1980s as part of a wider neoliberal agenda. Neoliberals think bureaucrats are self maximizing and try to grow their budgets, so NPM created incentives for the public sector to ignore their biases — e.g. competition through rankings, competitive funding, internal markets, performance pay, and outsourcing. Most people today think that NPM went too far but many legacy institutions remain.

In response to NPM, new public governance believes that the government should reflect the pluralism of society and use multiple processes to inform policy making. It focuses on interorganizational relationships, governance of processes, and stresses the effectiveness of outcomes — not governing performance but for performance. It believes that government services are the most important thing because that’s where most citizens interact with governments. Individuals care as much about the process accessing services as the outcome of the service.

Public administration (PA) theories often assume that the global/western way of doing things is the best and only way of running a bureaucracy, but different countries have solved the same problems the west has using their own approaches. Solutions depend on context and the ethical system they’re in. PA is ‘good’ when it is effective at doing what is supposed to do and is ethical. The three alternatives to western PA include Islamic, Chinese/Confucian, and Buddhist. There are some PA principles that are universal, some that are generally valid but need to be adapted to the context, and a third level that work well in a given paradigm but not another. It is important to learn from these alternatives where we can because western PA isn’t working for a lot of countries.

Policy coordination

Policy coordination can help avoid duplications, contradictions and displacement, but can also ensure changing demands change services, cross cutting problems are tackled, and government has a ‘more tidy image’. However, sometimes redundancy is good to make sure things get done. Avoiding conflict is negative coordination, while cooperating on solutions that benefit all organizations involved is positive coordination. Particularly when addressing grand challenges, you need positive and negative coordination, as well as vertical and horizontal coordination, where you work across policy areas and deep within them.

People don’t coordinate because of specialization, power, performance management, turf, beliefs and ideologies, politics, and accountability. To improve coordination, use networks, collaborate, or use a hierarchy — where the central government identifies opportunities for coordination.

The delivery of public services

People want good governance, not just more efficiency, so we need to move away from a dichotomy when it comes to the role of the public and private sector in delivering government services. There is a role for different types of organizations (e.g. public, private, cooperative and non-owned organizations) for different types of government activities:

• Citizen and subject activities (e.g. highways, social security, and economic policy) should be delivered by the state. Citizens have rights, but subjects have obligations — paying tax and respecting laws — in a more one sided relationship;
• Customer activities can be done by the private sector, since they are mainly transactional. This makes sense for simple, attributable and measurable things that could be priced;
• Client activities (e.g. professional services like healthcare and education) can be funded by the public sector but delivered by new types of organizations, like cooperatives or non-owned organizations led by boards. Businesses haven’t historically treated people very well in delivering government services — as trying to do things for the lowest possible cost isn’t ideal for these types of services.

Legislation and funding cuts are forcing governments to use more public private partnerships (PPPs). PPPs bring economies of scale, economies of scope and provide opportunities for mutual learning. On the other hand, PPPs are suspect by traditional public administration because it gives them less control; by government unions because they could cause job losses; by citizens because they dislike services being delivered with a profit motive; and by not for profits because they may lack accountability.

Ethics in the public service

Ethics and accountability are key for the functioning of democratic governance. Ethics is internal control, while accountability is external control. Because public servants have the authority of the state, we cannot hold them to the same standards as the private sector. Most countries have codes of conduct, codes of rules, or regulations for civil servants. There is a lack of empirical evidence on what works though (e.g. incentives versus penalties). If rules regarding ethics focus on inputs over outputs though, so do civil servants. It’s not just about more rules but better rules when looking how to encourage ethical behavior. At the end of the day, governments cannot treat everyone the same — people are human. Governments should focus on building the social psychology of the organization, and then the capacity of people to be critical.

Performance measurement

Measured performance needs to be incorporated into the management and policy systems for it to be effective. Single loop learning is how you use evidence to improve existing frameworks, like evaluating performance, user centric evaluation, or in-project reflections. But this means we focus too much on doing things incrementally better within the current system — building a faster horse instead of a car. Double loop learning goes further to examine how we could create different frameworks or values, like future oriented tools or a systems based approach to evaluation. Market shaping supports double loop learning by changing underlying principles and using a diversity of evidence and data, rather than just cost benefit analysis.