An innovative public sector?

Click for details of the forum on public sector innovation

Today’s post is by Hannah Kitchen, Policy Analyst in the Observatory of Public Sector Innovation (OPSI), of the OECD Public Governance and Territorial Development Directorate.

Last week over three hundred people from the public, private and civil society sectors descended on the OECD in Paris. Why? To discuss an innovative public sector. For some of you that might sound like an oxymoron, but over two days stereotypes were left at the door as participants shared stories and learnt about innovation in the public sector.

The conference on Innovating the Public Sector: from Ideas to Impact showcased the public sector at its best. Innovators from around the world stood on stage to give short, dynamic talks about what they were doing at home. There were talks about evidence and innovation in the United States; about police using social media in Iceland; and one about reducing visa applications in Turkey to three minutes online.

Participants also rolled up their sleeves to experiment with innovative approaches for policy making. They tried out design for public services, by mapping their own journey to the OECD and considering how it could be improved. They heard from policy makers from Chile to the United Kingdom, who shared their stories about how they are using innovation labs to build experimental, practical spaces to trial new ways of working and share what works.

Despite all this enthusiasm, the overwhelming consensus was that innovation in the public sector is still no easy feat. It’s difficult to get support from above, it’s difficult to have the time and space to come up with innovative solutions, it’s difficult to find the resources for unproven approaches, and it’s difficult rally others.

Over the past couple of years the OECD has been working with countries to develop the Observatory of Public Sector Innovation, to help them make the most of innovation. The Observatory puts the experiences of innovators from across the world at everyone’s finger tips. Want to know how the Icelandic police actually made social media work for them; or a Finnish hospital used service design to develop a better, more user friendly hospital? The Observatory contains hundreds of examples from across the OECD about how public services are developing more effective, innovative services.

It shows how countries are innovating across the whole policy making process. They are opening up policy making, so that a broader range of actors can shape policies. One way that they are doing this is by making the most of technological developments. Austria for example, is designing new strategies by crowdsourcing comments, advice and ideas from the public demonstrating how governments can involve a wider range of perspectives to source innovative ideas.

The Observatory also demonstrates that innovation is as much about the journey as the results at the end. That means rethinking how to design new services and embracing experimental approaches, prototyping, and trial and error. Public organisations need more agility, more testing and more experimenting on a small scale before investing large sums to roll out a new policy or service. In the United Kingdom for example, the use of randomised control trials is providing real evidence on the results of policy interventions on a small scale, providing a clear evidence base for action. In Australia, the Concept Lab allows the government to trial and fully evaluate potential improvements to services for families, the unemployed, care givers and parents under actual workplace conditions prior to wider roll-out.

Perhaps most importantly, the Observatory also highlights how innovation is resulting in better solutions for citizens, by responding to citizens’ needs, moving the services to them. In France, unoccupied rooms in housing are being used so that the elderly can share flats with others, at once reducing their social isolation and making use of existing underexploited resources. In Sweden, parents can now access information about their child benefits directly from their phone through an app, which also includes up-to-date information for all citizens on their old age pensions.

The Observatory is also an innovation in itself. It was built with an agile, staged approach. Users in countries were involved throughout, testing and retesting prototypes to ensure that it delivers on user needs and to enhance the user experience. More importantly it is a direct interface with innovators themselves – from local schools and hospitals to central government offices – anyone working in the public sector with a story to tell about innovation can use the Observatory to reach an international audience. Through its interactive features users can make their views heard by voting in regular polls, discuss with other users to learn about their experiences, ask questions, and even create their own groups for collaborative projects.

It is just at the beginning of its story. Over the coming months and years we hope that many more people across the public service and beyond will use the Observatory to interact with others and share their examples of innovation.

Have a glimpse of Observatory by watching this video:

Just the numbers: How much are public servants paid?

In the first of a new series focusing on data and statistics, the OECD’s Matthias Rumpf looks at how much public servants are paid in some OECD countries.

Few issues are more likely to provoke a row than the pay of public servants – overpaid and underworked or selfless heroes who could be earning more in the private sector? We can’t settle that debate here, but, using data from Government at a Glance 2013, we can at least give you some sense of how public sector pay compares across some OECD countries.

The most basic approach is simply to look at annual compensation in USD – in other words, salaries paid in local currencies converted into US dollars and then adjusted for purchasing power parity, a statistical technique used to compare the cost of living in different countries.

That’s useful, but it doesn’t show how public servants’ pay compares to that of other workers in their own countries. To do that, we can look at their pay relative to all tertiary educated – in other words, people with a college or university degree. That measure is especially useful for comparing the pay of senior public servants, who typically are graduates. In OECD countries, the most senior managers in the public service earn 3.4 times more than the average graduate, suggesting that such careers are an attractive option for graduates.

One last comparison: public service pay relative to GDP per capita. “GDP per capita” is calculated by dividing the size of a country’s population into its GDP, and it gives a sense of how prosperous people feel in each country. It’s probably especially useful in making comparisons of pay for junior staffers, such as secretaries. In Poland and the Netherlands, their pay levels are well above GDP per capita but in the Slovak Republic and Estonia they’re well below.


Useful links

OECD work on public employment and management

Government at a Glance 2013 (OECD, 2013)

Public Sector Compensation in Times of Austerity (OECD, 2012)

For the people…

Bad governance comes at a cost

Today’s post is from  Brian Atwood, chair of the OECD Development Assistance Committee.

At this year’s Global Forum on Development, I was invited to contribute some remarks on “governance”, a convenient shorthand for referring to the mechanics by which our societies are run, our institutions function, and our public administrations exercise fairness.

In today’s complex and globalized societies, governing implies understanding and applying a multiplicity of complex  rules, standards and agreements. Often these are quite technical, and even incomprehensible for non-experts who are unfamiliar, for instance, with the vocabulary of genetics databanks or nuclear energy. Others hide extremely difficult tasks of interpretation and application behind expressions we’re all familiar with, such as due diligence or bribery. And then there are those, such as transfer pricing, that are founded on concepts that are both technically demanding and arduous to understand and implement.

This is why we need bureaucracies: we need people trained to understand and apply the complex sets of rules that allow our ever-more diversified yet interconnected societies to function. Critics often point out that the great empires of Greece, Rome, China, Persia, or Britain managed to govern vast territories with fewer pen pushers than an average government department today. That may be true, but life is much simpler for an administrator who makes the rules, decides how (and if) to apply them, and can exile, imprison or execute anyone who disagrees. Fortunately today, it is the rule rather than the exception for legislation to hold governments and their administrations to account for how things are done.

At a meeting like the Global Forum, we are all constantly checking our smart-phones for emails or appointments, but we couldn’t have done this without a whole set of international rules and agreements covering everything from access to radio frequencies to taxes on calls from abroad.

Administering such matters is a vital task, like so many that our bureaucrats carry out. A quarter of a century before he published his Inquiry into the Nature and Causes of the Wealth of Nations in 1776, Adam Smith said: “Little else is required to carry a state to the highest degree of affluence from the lowest barbarism but peace, easy taxes, and a tolerable administration of justice; all the rest being brought about by the natural course of things.” Such a view might appeal to members of America’s Tea Party, but it doesn’t work in a world of complexities.

Nonetheless, we shouldn’t forget Max Weber’s warning issued over a century ago: bureaucracies, for all their benefits, can threaten democracy if they become an end in themselves rather than a means for the rest of us to carry out our business in the most practical, efficient way.

In Weber’s day bureaucracies were still essentially national, but even in his lifetime that began to change with the founding of the International Telecommunication Union in 1868, the Universal Postal Union in 1874, and the Intergovernmental Organization for International Carriage by Rail in 1893. When Weber died in 1920, there were 200 international diplomats and civil servants in Geneva; today there are some 40,000 and many more tens of thousands are to be found the world over, including in Paris where the OECD – one of the many organisations that oversees complex global standards – has its headquarters. These organisations exist because today we know that a modern society needs well-functioning public institutions to work well and fairly.

Yet if this is the case, why have our efforts to promote these lessons among developing states shown a low success rate? What is missing?

There is strong evidence that institutional reform, a core factor in development, has not succeeded when it is imposed from outside. In The Globalization Paradox, Dani Rodrik asks how young developing democracies can survive given all the obstacles built-in to global trade and financial regimes. He argues that when the social arrangements of democracies clash with the international demands of globalisation, as they inevitably must, national priorities should take precedence.

Yet our development agencies and international organisations, including OECD members, constantly fall short on an essential ingredient of the development recipe: local “ownership” by developing countries of their own processes and priorities, as well as of participation and accountability.

We invested in the transition from colonialism and were heavily engaged in the transition from communism, yet the wave of revolt that swept over the Middle East and North Africa saw us taking only baby steps. The arrest of NGO officials in Egypt threatens to scare us away. It should not. These organisations were in the country because Egyptians wanted them there. The National Democratic Institute, an organisation I once led, held seminars with 15,000 Egyptian participants, including the Muslim Brotherhood. They worked with Egyptians and it was Egyptians who ended up in court when the government cracked down, not the Americans who got all the media attention.

The December 2011 Busan Partnership for Effective Development emphasises that “promoting human rights, democracy and good governance are an integral part of development efforts.” This declaration was not just another agreement among governments. Civil society played a central role, with over 1700 CSOs represented at the High Level Forum that shaped the partnership, engaging fully in the agreements about how to make development more effective. They worked side by side with developing countries, parliamentarians, the private sector, foundations and non-OECD donors, all of whom today are helping to create a truly open, inclusive space for moving forward.

It wasn’t easy to get so many different groups to agree on shared principles; but debate is obligatory if we want to generate the broad commitment that is the foundation for building budget systems, tax systems and efficient public administrations under the control of democratic institutions with engaged citizens. This reflects one of the key aspects set out in the Framework for an OECD Strategy on Development adopted by OECD ministers in May 2011:  “Integrate, where appropriate, the diverse perspectives, views, and realities of developing countries in OECD analyses and policy advice to deepen shared understanding of the alternative impacts of different policy options”.

Timothy Besley and Torsten Persson’s Pillars of Prosperity: The Political Economics of Development Clusters suggests what this means in practice. They show that countries combine effective state institutions, absence of political violence, and high per-capita incomes when they have cohesive political institutions that promote common interests, guaranteeing the provision of public goods. The absence of common interests and cohesive political institutions can explain why fragile states are plagued by poverty, violence, and weak state capacity.

To become part of the solution, and not part of the problem, the OECD’s development strategy must embrace this self-evident truth. Only in this way can it prove Kafka wrong when he said to Gustav Janouch: “Every revolution evaporates and leaves behind only the slime of a new bureaucracy. The chains of tormented mankind are made out of red tape.”

I am confident that we can learn the lessons of both our successes and our failures.

Useful links

OECD work on governance and development

Key OECD publications and documents on capacity development