From “Public Management Reform”

By Christopher Pollitt and Geert Bouckaert

The relationship between poltics, public management, and public opinion is a contentious area, and one in which systemic data are at best patchy. Having made these caveats, we will attempt to draw out a few broad propositions from the evidence advanced above.

First, public management reforms have altered the relationships between elected and appointed officials, in a number of countries and in a number of ways. In this sense, at least, they are not ‘neutral’. It seems likely that these changes have been greatest in the core NPM countries, somewhat less in the northern group of European countries, and smallest in the central European group. Second, there is an absence of convincing evidence concerning the willingness or ability of executive politicians to become the the ‘strategic managers’ of their portfolios. The kindest thing that could be said about the reform models that cast politicians in such roles would be that they are unproven and seem to fly in the face of known incentives to behave in a more traditional ‘political’ fashion. Third, managers do appear to have gained extra authority in a number of ways but at the same time political control has been vigorously reasserted in many of the twelve countries. There is no necessary contradiction between these two developments – the public sector is large and diverse enough for both to be happening at the same time. In specific cases, however, there may be a quite definite tension. Fourth, any suggestion that public management can be radically depoliticized [...] is either a misunderstanding or flies in the face of evidence from many countries. The allocation of, say, health care resources or decisions about educational standards or major public infrastructure projects are all inherently ‘political’ decisions, whether they are taken by powerful politicians or tough public managers (or, indeed, medical doctors or teachers). The public will often see the political authority as ultimately responsible – or, at least, sharing responsibility – however much ministers may protest that these are technical or professional decisions which have been taken by the appropriate officials. Fifth, there is a certain ambiguity in much of the rhetoric around strengthening accountability and increasing transparency, in so far as the executive politicians have used the new politics/administration split to redefine policy weaknesses as managerial failures. This enables political leaders to shuffle off direct responsibilities for things going wrong – or, at least, to try to. Furthermore, it appears that legislatures have been slow to take up and use the increased flow of performance data which greater transparency and the contemporary emphasis on outputs and outcomes afford. [...] one might say that even when a ‘real result’ manages to climb over the conceptual, methodological, and political barriers, and escapes into the wider public world, it is often left wandering around looking for an audience. Sixth, few of the specific reforms appear to have been undertaken in direct response to ‘public opinion’ – although some such rationale has quite often been claimed. Privatization, the introduction of market mechanisms, downsizing, and the promotion of PI systems are the products of elite, not popular, agendas (even if public opinion has subsequently accepted some of these innovations and begun to make use of them). The sector of greatest tension would appear to be the welfare state, the basic elements of which remain enduringly popular in most countries but the expense of which inevitably draws it into the line of fire of the cost-cutters and downsizers [...] Seventh, any simple picture of public opinion as being ‘for’ or ‘against’ ‘big government’ is misleading. Such evidence as is available shows that, however limited the public’s knowledge may be of the specifics of reform, popluar attitudes towards government are multifaceted and, in some respects, quite sophisticated.

From “The State in Capitalist Society”

By Ralph Miliband.

By far and away the most important characteristic of the men who assumed executive power in July 1945 was the objective modesty of their ambitions, in economic and social terms.  No doubt, they thought and spoke of a “new social order” which must be built upon the ruins of the war.  But in terms of basic structure, that new social order bore a very remarkable resemblance to the old.

Perhaps the best and most significant token of that fact is that, had it been left to the Labour leaders, the Labour Party would have gone into the 1945 election free from any commitment to any measure of nationalisation whatsoever, save for the half-nationalisation of the Bank of England [...] What they wanted was a continuation in peace times of controls over economic life which had been introduced during the war, i.e. a more and better regulated peace-time capitalist economy, together with a much wider system of welfare provisions.  That the Labour Government did assume power committed to a programme of nationalisation was the result of rank and file pressure before and at the 1944 Labour Party Conference [...]

The nationalisation programme which the government did carry through during its period of office was a good deal less extensive than the Labour activists had wished, or than those who had voted for Labour in July 1945 would in all probability have been ready to support; but it was nevertheless substantial, including as it did the Bank of England, coal, gas, electricity, railways, a part of inland transport, cable and wireless, and, very half-heartedly, in the latter stages of the government’s life, the iron and steel industry.

Nor is it to be denied that these were measures which the economic and political forces of conservatism more or less strongly disliked, which a Conservative government would not have wished to adopt. In this sense it is perfectly appropriate to say that there was a certain unhingement between these forces and the Labour government on issues of considerable importance.

On the other hand, there are a number of considerations which need, in this context, to be taken into account. One of them was expressed by The Economist in November 1945, after the government had announced its nationalisation proposals, except for iron and steel. “An avowedly Socialist Government, with a clear parliamentary majority”, it wrote, “might well have been expected to go several steps further . . . If there is to be a Labour Government, the programme now stated is almost the least it could do without violating its election pledges” [...] In other words, the government had introduced a minimal programme, for which capitalist interests, however much they might resent it, could well, in the circumstances of the period, be grateful.

Secondly, it is hardly irrelevant to the issue that some of the nationalisation measures proposed and carried through by the government had been advocated or at least endorsed by Conservative and Liberal politicians as early as the first world war; and that, as Professor Brady has noted, a number of such nationalisation measures had been recommended  “by Conservative dominated fact-finding and special investigating committees” [...]

Thirdly, and perhaps most important, the government could scarcely have been more generous to the interested parties in regard to the all-important question of compensation: all in all, capitalist interests made an excellent bargain, in many instances a much better one than they could have made had they been left in command of their property.

Finally, the exceedingly conventional, bureaucratic and “business-like” manner in which the government envisaged the administration of the nationalised industries, combined with its appointment of men drawn from large-scale enterprise to their boards, helped to ensure that the enlarged “public sector”, far from proving in any sense an embarrassment — let alone a threat — to the private sector, would in fact become an exceedingly useful adjunct to it.

In this light, it is easier to understand Attlee’s recollection that “there was not much real opposition to our nationalisation proposals, only iron and steel roused much feeling” [...] For all the talk of a “mixed economy” which these measures engendered, not to mention the often-expressed view that Britain, because of them, had undergone a “socialist revolution”, all nice and peaceful, nationalisation not only did not weaken British capitalism; in some essential regards it strengthened it.