Public sector productivity – not an oxymoron

Yesterday I attended a fascinating event at the LSE, the launch of 

by Patrick Dunleavy and Leandro Carrera – the video is due to go online later. I’ve only read about half the book so this post is more about the event than a review. Even at this stage, though, it’s clearly an essential read for anybody concerned with the quality, efficacy and value for money of the public sector. That’s all of us, of course: 24% of UK GDP is accounted for by public services, so productivity growth here is vital for economic growth overall; and we are all consumers of public services, from defence and justice to schools and rubbish collection.

[amazon_image id=”0857934988″ link=”true” target=”_blank” size=”medium” ]Growing the Productivity of Government Services[/amazon_image]

In his introductory talk, Prof Dunleavy noted the variation between different public sector organisations in the measures of productivity they had been able to collect. Spending on ICT was positively correlated with improvements, despite the well-known IT disasters, because the technology is an important enabler of changed ways of working. Reorganisations are also linked to productivity improvements (although spending on external management consultants not at all). He concluded that the key steps for achieving productivity improvements are: the leaders of the organisation must engage with change; the agency must develop its own ideas for innovation; the leadership must engage with employees and ensure they don’t believe change is only about saving costs and cutting jobs; and intra-government and 3rd sector rivalry is helpful. The book includes many practical specific examples of change, successful and not, in different (national) government organisations, and also a really helpful table of suggestions with comparable private sector examples.

The terrific thing about the book – as one of the panellists, Barry Quirk, CE of Lewisham Council underlined – is that it fills the empty territory between the abstractions of ‘policy’ and the rough and tumble of politics by looking at organisations and the specifics of what they can do to improve. His main message was about needing ‘productivity with a purpose’ and never losing sight of what the public service purpose of the organisation is. As he pointed out, among the most borrowed titles from Lewisham’s libraries are a guide to pubs in South London, one to teenage sex, and 50 Shades of Grey – along with, thank goodness, Hilary Mantel’s


[amazon_image id=”0007315090″ link=”true” target=”_blank” size=”medium” ]Bring Up the Bodies[/amazon_image]

Joe Grice, chief economist at the Office for National Statistics said productivity improvements were imperative not so much because of public finances – although that obviously matters – but because people value public services so highly. He emphasised the need to link measures of productivity to activities so there is a feedback loop.

Edwin Lau, head of the OECD’s public sector productivity group, said Ministries of Finance tend to be most interested in the subject because they want to harvest the financial savings, but it is important for public agencies to appreciate the scope productivity improvements give them for internal reallocation of funding to serve their strategic aims; and that officials in different countries could learn more from each other.

This gave rise to one comment from a US member of the audience, noting that many of his compatriots would consider ‘public sector productivity’ an oxymoron, and the book would need to be retitled something like ‘Lifting the burden of the public sector on Americans’ in his country! The discussion left me feeling optimistic, however. As a senior official in the audience said to me afterwards, many people think improving public sector productivity is just too hard, but it can be done.