A crisis too good to waste

“Don’t let a good crisis go to waste.” This is the view of Donald Savoie, one of Canada’s leading academics in the field of public administration. For Savoie, and for many of those who study the ways that governments govern, this phrase highlights one of the behavioural realities behind bringing change to large, unwieldy organizations. Given the slow-moving, even glacial, pace of government reform, sometimes a crisis is needed to spur action and achieve the change we desire.

What Savoie argues is that we should not let the opportunity to achieve positive change slip through our fingers, even if (or especially if) the spark for that change comes from a negative source.

Research in Motion, the makers of the famed Blackberry, are struggling to reinvent themselves and their flagship product in the face of declining sales and increased competition. Apple is pondering its future without Steve Jobs at the helm. In New Brunswick, we are wondering how to deal with chronic provincial deficits and the possible impact that a dramatic reduction in government spending might have on our economy and our public services.

And that is the dilemma facing Premier Alward and Finance Minister Higgs. If it were really as simple as cutting government spending, the solution would be easy – cut until you balance the budget. However, the challenge is to achieve a balanced budget without putting the provincial economy in a tailspin or without cutting those public services that we, as citizens and taxpayers, value and pay for.

The problem is, and always has been, a matter of political will. The status quo has its champions – those who benefit from the current situation and those who fear that things can only get worse.

The benefit of a crisis is that it holds up a mirror to both these groups. It shows that the situation is unsustainable or that, without action, the situation will grow worse. A crisis can also compel a slow-moving organization to act. A “good” crisis, like an impending execution, can focus the mind.

Rather than pleading helplessness or, even worse, panicking, how should the Government of New Brunswick deal with its financial situation?

The first step would be to recognize that the current situation is largely one of our making. If we got ourselves into this mess, then we can get ourselves out of it. By taking responsibility, we also admit that we do not expect anyone else to help us out of our situation.

The second step is to get serious about expenditure control within Government. As the recent budget update revealed, government revenues have not met the expectations set out in the last Budget. Unfortunately, government spending has also exceeded projections, leaving us even worse off than before. Perhaps a strengthened Board of Management, one of the recent reforms announced by Premier Alward, will provide the expenditure control the provincial government so desperately needs.

Management guru Peter Drucker is known for saying that you cannot manage what you do not measure. For our two largest government departments in terms of spending, Health and Education, we are not measuring very much at all.

We do know that, year after year, more money is being allocated to these two departments. What we do not know, or measure, is the impact that this increased funding is having on service delivery and outcomes. While other departments need to justify their existence and their programs on an annual basis, Health and Education are given a relatively free ride during budget time.

New Brunswickers want a robust health care system. We also want schools that achieve results. Despite the additional millions being allocated to these departments on a yearly basis, we are not sure we are getting the results we are paying for.

We need more accountability from both these departments with regard to the way they are spending public funds. It is not enough for Government to say that they are spending more in these areas; we need to have confidence that this money is being well spent. By measuring more, by becoming serious about evaluating the efficacy of spending within their portfolios, both departments will be better managed.

Both departments are in serious need of modernization. Again, the problem is not with the public servants who are delivering health care or classroom instruction, it is with the antiquated business processes that both departments employ. Both departments have been talking about new initiatives to streamline management and provide the detailed information to better manage resources, such as the “One Patient One Record” system for health care or a new human resources and payroll system for Education. Unfortunately, there has been more talk than action on these fronts. The sooner we make the investments that will help better manage these big spending departments, the sooner we will reap the benefits.

During the 1990s, governments across Canada made a focussed effort to balance their budgets and to keep them balanced. One of the key lessons drawn from this experience is that an increased focus on serving citizens, by being timelier and less bureaucratic, is more likely to deliver overall cost savings than the across-the-board cuts that are favoured by Departments of Finance.

Essentially, the less time an item stays on a government desk, the less it costs government to manage. By streamlining the way things are done, government services become more responsive and citizens enjoy better service. Service New Brunswick is a good example of how an innovative approach can deliver better results for citizens at a reduced cost to taxpayers.

In contrast, a program of government restraint that is purely focused on spending cuts has proven to be unsuccessful. In addition to creating chaos within government as they manage arbitrary budget reductions, a “cuts-only” approach does nothing for the citizen. Without modernizing or retooling government processes, the savings from a “cuts-only” prove transitory. Once budget balance is achieved under this model, pent-up demands for better service will force government to increase spending once again.

Rather than expecting less from government, we should expect more. We should expect that government will look beyond the reductive exercise of arbitrary cuts to the more demanding (and more rewarding) approach of using better service as a tool to drive costs down.  

The Government of New Brunswick needs to seize this opportunity. It really is “a crisis too good to waste.”

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This article was originally published in the January 2, 2013 edition of the Telegraph-Journal.