Measuring Public Sector Performance and Effectiveness

In Beyond Machiavelli: Policy Analysis Comes of Age, Beryl Radin (2000a: 168) observes: ‘If there is a single theme that characterizes the public sector in the 1990s, it is the demand for performance. A mantra has emerged in this decade, heard at all levels of government, that calls for documentation of performance and explicit outcomes of government action.’ Responding to increasing demands for performance documentation, governments in the United States, Canada, Western Europe, New Zealand, Australia and in countries in Asia, Africa and Latin America have made performance measurement a core component of public management reforms (Behn, 2001; Kettl and DiIulio, 1995; Pollitt and Bouckaert, 2000). While the broad objectives of these reforms to promote more ‘effective, efficient, and responsive government’ are the same as those of reforms introduced more than a century ago, what is new are the increasing scope, sophistication and external visibility of performance measurement activities, impelled by legislative requirements aimed at holding governments accountable for outcomes (Gore, 1993: xxiii; Pollitt and Bouckaert, 2000). The ramifications of reform initiatives that mandate formal, outcomes-based performance measurement in public programs are being debated by public management scholars and practitioners, with discourse extending from the ‘New Public Management’ (NPM) reforms to local level performance contracts that aim to ‘use market forces to hold the public sector accountable’ (Kaboolian, 1998: 191; Lægreid, 2000; Radin, 2000b).

Accountability — to legislative bodies, taxpayers and program stakeholders — is a primary goal of public sector performance measurement. In The International Encyclopedia of Public Policy and Administration, Romzek and Dubnick (1998: 6) define accountability as ‘a relationship in which an individual or agency is held to answer for performance that involves some delegation of authority to act’. By this definition, accountability compels some measure or appraisal of performance, particularly of those individuals and agencies with the authority to act on behalf of the public. A historical review of public sector performance measurement shows that the majority of initiatives have focused on holding agencies or executive administrators accountable for financial performance or efficiency. Behn (2001) describes ‘accountability for finances’ as a ‘rules, procedures and standards’ form of accountability. The NPM and other recent reform initiatives, which ostensibly differ from earlier approaches in their promotion of a ‘customer service’ focus, ‘market-driven management’, and accountability for ‘results’, are also still concerned with ‘saving money’ and ‘productive and allocational efficiencies’ (or a government that ‘costs less’) (Kaboolian, 1998; Pollitt and Bouckaert, 2000; Terry, 1998).

If, however, the legacy of public management reform is likely to be a ‘stronger emphasis on performance-motivated administration’ that advances the art of public management, as Lynn (1998: 232) suggests, then public sector performance measurement has to involve more than accounting for finances and ‘answering for performance’. As John Kamensky (1993: 395) [Page 26]exhorts, ‘there have been enough paperwork exercises in government’. We need to develop measures that will inform and be used by public managers, not only ‘accountability holders’ such as legislators and oversight agencies, to guide them in improving service quality and results. This begs the question: What information is most useful for public managers striving to improve government performance? For example, under the US Government Performance and Results Act (GPRA) or the United Kingdom's Next Steps, how do public managers use the information from annual program performance reports that compare measured performance with performance goals? Simply knowing that they have achieved or failed to achieve target objectives or standards is not likely to aid public managers in understanding why performance is at the level it is or how managers can effect change. As Hatry (1999: 6) observes: ‘A major purpose of performance measurement is to raise questions’ it seldom, if ever, provides answers by itself as to what should be done.'

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