Innovation versus restraint

Hey there, time traveller!
This article was published 16/03/2018 (3006 days ago), so information in it may no longer be current.

The Pallister government’s third budget on Monday continued the course of selective cutbacks and generalized restraint. The strategy of restraint was deemed necessary to eliminate the deficit, put public finances on a sustainable path going forward and allow taxes to be reduced.

How necessary and how severe the restraint are matters for debate elsewhere.

The focus here is on how the budgetary strategy aligns with the document Transforming the Manitoba Public Service, released just two weeks earlier. That document offered a vision of a future public service that would be efficient, client-focused, productive and innovative.

What is the relationship between the restraint strategy and the innovation strategy? Are they complementary or contradictory? My short, somewhat unsatisfying answer is that the relationship is complex, uncertain and risky.

The government has sought to convince Manitobans that the province faces, if not a financial crisis, then at least a set of severe budgetary challenges that are the legacy of the high taxing and high spending by the former NDP government. Accumulated debt, high annual deficits, downgrading of the province’s credit rating and unfavourable comparisons to lower-tax provinces are the evidence the government uses to justify its claim it has no choice but to reduce the rate of public spending.

Creating a sense of crisis and/or scarcity makes it easier to “sell” the budgetary strategy of cutbacks/restraint to voters, public servants and the beneficiaries of programs being terminated or reduced.

Like governments past, the Pallister government minimizes the potential harm that might flow from restraint. It insists economy and efficiency measures can deliver savings that will allow essential and effective programs to be protected. Usually, the efficiency gains turn out to be smaller than the rhetoric implies.

The hopeful assumption is that scarcity in departmental budgets will become the “mother of invention,” causing new, more efficient and more effective managerial approaches to be found.

The paper on public-service transformation argues that a lack of competition leads to a lack of innovation. This means government and public-service leaders must, in the words of the paper, become “the disruptors.” Inertia in public bureaucracies is a real problem; on the other hand, many public servants are unhappy with the status quo and would welcome change. Reform works best when it is not top-down, unilateral and forced.

Innovation involves risk-taking. Politicians may declare they can tolerate failures or disappointments, but in practice, they usually demand no mistakes that could lead to negative news.

A government determined to downsize bureaucracy has three alternatives: uniform system-wide cuts/freezes, selective strategic reductions or some combination of these two options.

By treating all parts of government the same, a uniform approach appears to be fair. However, it also cuts the more efficient and effective parts of the bureaucracy to the same extent as the underperforming parts.

The strategic-priority approach demands a clear sense of direction, planning over several years and making tough choices, all of which lead to greater controversy, social conflict and political risks for the governing party.

Ideally, the strategy of restraint and the strategy of innovation will be aligned such that they complement and reinforce one another. Without explicitly saying so, the Pallister government appears to believe that the three main components of its public-service transformation strategy will support its budgetary strategy.

The three components are: building a performance-management framework through the use of balanced scorecards for all departments; public reporting on progress toward the achievement of program outcomes; and enhanced citizen engagement through a centralized consultation portal.

The Pallister government has to convince the public — and, to a lesser extent, its employees — that the restraint process involves rational calculation that includes considerations of social justice.

The Progressive Conservative government of premier Sterling Lyon (1977-1981), the only one-term government in Manitoba history, campaigned and governed under the slogan “acute protracted restraint.” Presumably, Premier Pallister recognizes this risk.

Paul G. Thomas is professor emeritus of political studies at the University of Manitoba.