By
Robin Johnson 1
This paper stems from a continuing concern with the political economy of Government decision-making, first taken up by the author in 19942 . More recent work has been devoted to the quality of policy advice and the relations between government ministers and their advisors3 . The latter involves the currently accepted convention that public servants are independent of the parliamentary decision making system. How important is this convention and is it on the wane or still robust and strong in our respective countries? This paper argues for the maintenance of independence and the right to give free and frank advice.
Economic policy is determined by political decision makers under our systems of government. Decision making is supported by papers and advice from the government's own public service advisors. Decisions are not made only on the basis of formal advice given but may be influenced by perceptions of what is politically favourable or follow the pressure provided by some interest group. In addition, Ministers and other decision makers are surrounded by party appointees and other advisors who not only process papers thru their offices but also provide summarised interpretations of the message enshrined in the papers. This article is about the interface between public service advisors and Ministers or their representatives.
Australia and New Zealand government systems are largely inherited from the British Westminster system. Allowing for differences in federal arrangements and presence or absence of an upper house, both countries have long based their processes and procedures on British practice. At different times, the Australian states (and later the Federation) and New Zealand, in 1912, put in place the principles of an independent civil service with certain conditions of service which provide security of tenure and pensions, that can be traced back to the Northcote-Trevelyan report in the UK of 1854. These conditions make possible the giving of free and frank advice to Ministers. This article is about maintaining this state of independence and why it is important.
The political framework is best described by public choice theories of public administration and decision making. This encompasses the role of interest groups, self-interest among decision makers and bureaucrats, the reliance on agency relationships, and the role of modern administrative processes 4. The rise of institutional economics has also challenged Pigouvian welfare economics and moved the emphasis to the Coase theorem and transaction costs5. Many economists are employed as advisors and planners in the bureaucracy and hence have a continuing interest in the philosophical background to the role they play.
Systems differ in different countries with regard to the delivery of policy advice. In New Zealand, inter-departmental clearance of papers and viewpoints is normally sought before submissions to Ministers. In effect, it is then procedurally correct for the same papers to go forward in the Minister's name to Cabinet. In the UK and I understand in Canberra, Ministers can and do submit papers without prior consultation. In the UK, Ministers sit in offices in their departments while in Canberra and New Zealand they keep together in the Houses of Parliament and are removed from their supporting departments. Most governments have a Cabinet manual which sets out how these systems work and how to prepare submissions; and which attempt to define the relationship between ministers and their officials.
Whether policy is driven ‘top down’ or ‘bottom up’ is a matter of debate. Top down driven policy means at ministerial direction and advisors must of necessity fall into line in such matters. Bottom up driven policy is policy change arising from experience and administration of programmes and policy within departments. Policy making in reality consists of both streams though conflicts obviously exist.
Good quality decisions arise from good preparation and anticipation of decision makers' needs. Essential ingredients are high levels of staff training and systems development and communication. Major effort tends to go towards the budget process as it is the vehicle for government aspirations as well as the individual departmental plans. Efficiency gains in government expenditure have been a desideratum for decades but more recently fiscal stringency has required governments to define more carefully what gains have been achieved and at what cost.
This paper is organised around a brief history of the Westminster system of Cabinet government and its traditions and conventions, the accepted conventions with regard to independence of the public service, the role of non-public service advisors, and the ideas that drive policy advice such as the adherence to a national viewpoint on policy issues. We conclude with discussion of quality and control issues in the preparation of papers and submissions including budget papers.
Until the middle of the nineteenth century, the affairs of state in the United Kingdom were administered by public officials who owed their positions to political patronage and influence. There was no common system of pay, bribes augmented official salaries, and officeholders, who viewed their positions as property that could be sold, often engaged and paid their own staff. Although the system did not rule out advancement by individual ability, it was not a basis for sound administration.
The blueprint for civil service reform was the Northcote-Trevelyan Report of 1854, which advocated the creation of a modern buraucracy based on a career civil service. Drawing on ideas advanced for the Indian civil service by Thomas Macaulay, it was proposed to divide the Government's work into two classes; intellectual (policy and administration) and mechanical (clerical); and creating a career civil service to carry it out. Staff capable of performing the intellectual work would be recruited from the newly reformed universities; the best talent would be selected through tough competitive examinations supervised by a board of civil service commissioners.6
In New Zealand, the Civil Service Reform Act of 1886 provided for entry into the civil service by a competitive examination. The Public Service Act of 1912 made provision for security of tenure, good behaviour, promotion by merit, pensions on retirement, and abolition of entrance by other than competitive examination.7 Subsequently, the idea of the bureaucracy as a provider of independent and objective policy advice developed slowly and was firmly put in place by some of the well-known civil servants of the day such as Ashwin, McIntosh and Robson.
This does not mean that the elected officials have to take the advice given by non-elected officials, but it does represent an important distinction derived from the Northcote-Trevelyan reforms in the UK that the civil service has a tradition of independent advice to government which should not be discarded lightly. The institutional memory of agencies and their professional capacity constitute the comparative advantage of the career public service. In an operational sense, the tradition is maintained by non-elected officials commitment to offer alternative courses of action for consideration of Ministers so that their neutrality is preserved. The political branch of Government is interested in getting the job done in the light of pressures upon them, as public choice would indicate, so Ministers do not care one way or the other whether the advice given to them is neutral or not.
Arising out of the Westminster tradition, the convention has grown up that public service advice should be independent of the partisan political activity of the parties seeking to achieve power and retain it. This is not such a clear and precise distinction as is sometimes portrayed. A senior Canadian official has captured well the nature of the relationship:
"Being a deputy minister requires a capacity to understand and work to the subtle shadings of meaning around the concepts of policy advice; ( a legitimate and critical part of the job), political advice; (goes with the territory, but a minefield) and partisan advice; (off limits). These are shadings Ministers, particularly new ones, may have trouble grasping".8
Cabinet manuals and instructions lay down what public servants may or may not do in taking part in the political process, and it is expected that policy advice to Ministers is instructed by a national interest view of the changes to policy programmes involved.
However, recent events in Australia and New Zealand have highlighted the role of political advisors in the policy making process. In Australia, the Tampa affair lead to the Senate setting up an inquiry into information handled by political appointees in Ministerial offices, and in New Zealand debate over genetic modification of plant materials lead to a charge of public servants concealing information. These debates challenged the role of public servants in giving free and frank advice to governments and also asked whether ministerial appointees were bound by the same duty considerations which applied to public servants.
The recent Senate Finance and Public Administration Committee report on staff employed under the Members of Parliament (Staff) Act 1984 discusses these issues 9. Arising out of the Tampa affair, the Senate asked the finance and public administration committee to investigate issues of governance and accountability of ministerial staff as opposed to public servants. The Committee reported back on October 16 2003 with a clear statement on the roles and responsibilities of non-public service employees in ministers offices.10
The committee noted that the tasks involved did not create roles to be undertaken by public servants who serve the government of the day. Having political staff is intended to ensure these roles are adequately and professionally performed, and to help ensure that the public service does not become politicized. Since 1984 these staff have been employed under the Members of Parliament (Staff) Act (the MOPS Act). The number of positions has grown from 700 in the early 1980s to nearly 1200 in 2003. Ministerial staff have a wide range of responsibilities, and have become pivotal to the interaction between government and the bureaucracy. There is, however, little official guidance offered to ministerial staff regarding their roles. The distinctive roles of public servants and ministerial advisors need to be more clearly defined. Responsibility needs to be clearly allocated for ensuring that ministerial staff are aware of their roles, and of what they can and cannot do.
The committee noted the distinction between accountability and responsibility. Public servants are accountable to parliament but not responsible for the policy of the day. Ministerial staff are accountable to their Ministers and hence have a direct relationship to the minister's responsibility. The committee discusses whether ministerial staff can be required to appear before parliamentary committees. It notes that committees have the power to make staff appear. Conventions need to be developed for this kind of event as had been the case in the past for public servants. Such a convention should be guided by the principle of preserving ministerial responsibility and the principle of maximising accountability and transparency of government.
The committee also suggest a re-organisation of the MOPS Act to distinguish between pure ministerial staff and electoral and other routine staff. There should be an annual report on staffing under the MOPS Act. It is imperative that recording systems be updated for archival purposes but also for difficulties in the event of a communication breakdown. The committee finally recommended that a code of conduct be implemented for ministerial staff. This should include a statement of values. Such a code should specifically address the roles that ministerial staff can and cannot perform, and how they are to relate to the public service and party organisation.
More generally, the committee considered the whole relationship between ministers' offices and the public service. "Effective relationships require trust, professionalism and must be based on frank and fearless advice". These in turn require that the public service is not politicised, that there are clear and accurate lines of communication, and that training and professional development of both MOPS staff and public servants are adequate to ensure that everyone is clear about the roles and responsibilities of both groups of employees. Senior public servants must feel their position to be secure enough to underpin the offering of robust policy advice; thus permanent secretaries could have greater job security than was currently the case (i.e.5 years). The committee also noted the growing ambiguity about what constitutes official communication and advice between agencies and ministers. New rules need to be developed in this day of electronic communication and (sometimes deliberate) lack of archiving.
In New Zealand, behaviour in these matters is guided by the public service code of conduct. The thrust of the code can be drawn from the three principles of conduct set out in the Code (2001 edition):
In terms of political participation, public servants need to ensure that their participation in political matters does not bring them into conflict, or the appearance of conflict, with their duty as public servants to act in a politically neutral manner. This is important to maintain public confidence in the impartiality of the advice given, and actions taken, by public servants.11
The giving of advice should be on a free and frank basis. Such advice should be "honest, comprehensive, and impartial".12. This free and frank convention relates directly to the need to maintain the confidence of the current as well as a future portfolio Minister, and to the principle of political neutrality. It is set out that public servants are responsible for alerting Ministers to the possible consequences of following particular policies, whether or not such advice accords with the Minister's views.
The role of ministerial advisors is covered in the same fact sheet. These are defined to include political, special, personal or non-departmental advisors. They are appointed by the Department of Internal Affairs to work in Minister's office. They are not required to be politically neutral and are to be differentiated from departmental staff seconded to Minister's office. Since political advisors are a fact of life, rules need to be developed to enable public servants to work with them. While they do not have any legal authority to direct public servants, in a professional and cooperative relationship, political advisors can provide guidance about the Minister's policies and wishes and, by doing so, help public servants in their duty to be responsive.13
Problems raised by the "Corngate Affair" related to the publication of a book on a cover-up of genetically modified seeds during an election campaign.14 The Prime Minister promised that officials would be available to give full briefings to all those who asked for them. The Commissioner saw this as an unusual request during an election campaign and laid down certain rules of engagement. His fear was that the event would be seen as public service support for an incumbent government during an election campaign and he drew parallels with the "children overboard" case in Australia.
Economic advice to Ministers ought to be impartial and objectively based. Among policy makers, this has come to be known as public interest economics or national viewpoint economics. This attempts to identify what is in the interests of the nation as a whole as opposed to the party in power and the interest groups they represent. The national interest also means the longer term welfare of the nation as opposed to a short-term perspective. The national interest view excludes self-interested advice from bureaucrats which public choice sometimes focuses on as in Yes Minister.
Such an approach requires clear statements of assumptions, a continuity of economic logic, an exploration of different possible outcomes, and costs and benefits of different courses of action. Particular attention should be paid to appropriate national income measures, not confusing the sectional interest with the national interest in the data employed, and the "with and without" assumptions with regard to the effects of different courses of action. The analysis of costs and benefits also has its own overload of basic assumptions with regard to base lines, discount rates and national income criteria.
In the competition field, the New Zealand Commerce Commission is required by statute to examine policy issues involving acquisitions and mergers. The methodology utilised is very instructive in terms of high level economic analysis of the national interest. In terms of the Commerce Act 1986, the Commission is required to look at any acquisition or merger in terms of increased market dominance (s 67(3)(a)), and failing that test in terms of whether the public benefits that might follow would justify the acquisition or merger (s 67(3)(b)). "The authorisation procedure requires the Commission to identify and weigh the detriments likely to flow from the acquiring of a dominant position in the relevant markets, and to balance those against the identified and weighed public benefits likely to flow from the proposed merger".15 This is equivalent to the national point of view or the national interest.
The preciseness of this approach is illustrated by a strict concern for comparing bananas with bananas. Reports and analysis are based on a thorough discussion of what is known as the "status quo scenario", as compared with any changes brought about by regulatory means or policy changes. In the recent case of the "Dairy Determination", two base scenarios (counter-factuals) are developed and utilised.
(1) The "status quo" counter-factual is not regarded as a standstill in time. Rather, the Commission asks what events would have taken place in the absence of the merger and then puts them in the "status quo" scenario. Thus the Commission assumes a continuation of the current industry structure (pp.90-91) and of the single desk seller for exports, and that efforts at further structural change within that structure and regulatory framework will continue.
(2) The "deregulation counter-factual". This envisages the deregulation of the Dairy Board export monopoly, and the emergence of two powerful competing co-operative companies, possibly with overseas links, heavily involved in marketing in competition. In such a process, this counter-factual would include the un-bundling of the payout to suppliers, improvement to the internal pricing systems, and joint venture developments.
The Commission then proceeded to an examination of the detriments of the proposed merger and the possible benefits against these two counterfactuals. They looked at allocative and productive efficiency changes in the NZ domestic market as a whole.16
The same approach is evident in the Qantas-Air New Zealand merger proposals. In this case, the definition of the counter-factuals has proved very tricky. On the basis of confidential information provided by the airlines, the Network Economics Consulting Group constructed a counter-factual based on the possible competitive situation without an alliance. Qantas would increase its capacity on both New Zealand domestic and trans-Tasman routes and Air New Zealand would have to match these increases to maintain market share. Over a 5-year period Air New Zealand would be forced to withdraw its international services, eventually shrinking to a domestic airline. Critics have thus raised the issue whether the strategy of the airlines is to paint a counter-factual so dire for Air New Zealand that the alliance becomes more acceptable than it would otherwise be.17
These issues involve serious examination of the possible trends in the air passenger market in Australia and New Zealand over a considerable period as well as savings derived from cost efficiencies. Thus choice of the counter-factual is fundamental to any analysis of a merger proposal and involves serious consideration of possible future scenarios; perhaps more than one? As is now well known, rival experts are employed to debate these fundamental issues so as to move to a final agency view. Within Government these debates may not be so apparent and there is some scope for departments to avoid getting involved in such issues at all. Inter-departmental consultation often focuses on these kind of issues. Ministers expect departments to deal with them and come forward with an agreed position. Cabinet Committees do not like officials debating issues of methodology in front of them!
The interface between Ministers and the public service is at its most formal
in the budget process. Departments (or portfolios to use Di Francesco's term) submit plans for annual expenditure to Treasurers/Ministers of Finance. Finance and Treasury officials draw up the total expenditure plans or budgets from these submissions. Debate and final responsibility is at Ministerial level. For these plans to be realistic portfolios must put considerable effort into their preparation especially in times of fiscal restraint. Nevertheless, the balancing of these demands is essentially a political decision in the absence of high level analysis and research. The role of the bureaucracy is to give independent advice on budget items presumably arising out of adequate research, monitoring and evaluation.
In Australia, there has been considerable emphasis on evaluation as an instrument of budgetary accountability.18
"Formally initiated in 1988, the strategy introduced systematic program evaluation into Commonwealth government with the intention of achieving three broad objectives - improving the information base for program management, providing evidence of program managers stewardship of resources so as to improve public accountability, and assisting government decision-making in the budget process. Programs are to be evaluated within a three to five year cycle with this activity guided by two planning processes, the first directed at organising evaluation for portfolio-level program management purposes (agency evaluation plans), the second aimed more ambitiously at integrating evaluation within central budgetary processes (portfolio evaluation plans)...the evaluation strategy emerged as an information system geared towards the requirements of central government, as much as the result of historical reasons as the pressures for central administrative restructuring which accompanied the onset of fiscal stress during the last decade...Because portfolio budgeting obliged agencies to prioritise their programs in terms of efficiency, effectiveness and appropriateness (or relevance), program evaluation was intended to become the linchpin of expenditure control"(op cit, pp.33-34)(emphasis added). 19
On the question of budgetary control, Di Francesco concludes that the use of the evaluation instrument for advising on both the merits of policy submissions and the location of possible savings measures, has proved difficult to manage; the evaluation planning process was, by design, heavily weighted against the central budget agency; the available performance information was either not relevant to cabinet-level priority setting or was predictably deployed by portfolios to act as a shield for programs; and the evaluation planning cycle did not fit into the overall budget cycle. Secondly, evaluation material offered up was not on a systematic basis envisaged by the strategy, that is, it was referred to on an ad hoc basis when it was available (op cit, p.45).
Ryan 20 points out that Finance (in Canberra) believed that evaluation methods were relatively straightforward and uncontroversial and only had to be adopted to start producing the desired results. Early experience showed that it needed a relatively long lead time to build evaluative capacity across a wide range of agencies, and that appropriate and ring-fenced budgets were a necessity. Also relevant were the availability of sufficient skilled internal and external evaluators, greater understanding of the complementarity of quantitative and qualitative methodologies, long-run qualitative and quantitative data sets, and the need for an outcome-oriented approach to performance by senior management, ministers and parliament.
While New Zealand has not introduced a formal requirement for evaluation in the manner of Finance in Canberra, recent policy delivery developments have focussed on more clearly defined statements about expected outcomes. The inherent logic of the outcome/output distinction means that portfolios (departments) must be able to justify the outputs they put forward for ministerial agreement (and as a basis for budgetary accountability). One Treasury official reported: "Assessments need to be drawn about the relationship of inputs to outputs (technical efficiency or value for money), outputs to outcomes (allocative efficiency or effectiveness) and on changes in departmental capability (physical or intangible investments).......An intention of the reforms was to create greater incentives for departments to assess and reveal performance in each of these dimensions. The spur would come from Ministers acting as a discerning customer. Ineffective outputs would be cut out, and if prices were too high other suppliers would be sought, or if this was not possible changes might be sought to management".21
The experience has been as mixed as that of the Australians. "To date this goal of departments proving their performance has only been partly achieved. One reason has been the time needed to make and embed changes of this magnitude: lifting the levels of technical and management skills, introducing new systems of funding, reporting, and performance measurement. Changing departmental cultures takes years. Another reason is that greater onus could have been placed on departmental managers to prove their efficiency and effectiveness. Placing the onus of proof onto spending proponents would have increased the incentives on departmental Ministers to seek information from their departments". (op cit, p.2).
This analysis suggest that fiscal constraints have increased the pressure on Ministers to seek information on the effectiveness and efficiency of the outputs they are buying. Central agencies should continue to place pressure on spending agencies by greater comparative information gathering, the use of performance measures, and annual performance assessments of chief executives. "Learning from experience can enable improvements in policies over time, and formal ex post evaluations have a place in shaping the next iteration of policy advice. Whether the cost of the evaluation is warranted needs to be weighed up in each case. .....we think good decisions on evaluations are more likely if departments face strong incentives from Ministers to provide convincing evidence about efficiency, effectiveness and the capability of their organisations to continue to deliver outputs efficiently over time. An effective budget constraint is a wonderful spur to seek better advice".(op cit., p.10).
The Australian guidelines appear to be some of the first published in the literature. The Commonwealth Department of Finance guidelines date from 1994 22.
These authors noted that there was a tendency among agencies to address some but not all of the criteria thus weakening the general case for imposing evaluation. They draw particular attention to the twin-test which addresses not only Ministers' needs but the community's standard of needs. "Doing justice to it will be never be easy; but ignoring it is a sure recipe for declining community confidence in government" (op cit., p.53).
In New Zealand, the State Sector Act 1988 has resulted in a different set of guidelines. The distinction between outcomes and outputs creates a framework for accountability and responsibility in the policy delivery system but not a set procedure for evaluation of past policies as part of the policy advice process. Thus a 1995 assessment 23 drew attention to the weak connection between outputs and outcomes. Poor quality policy analysis and solutions were being offered to Ministers as a result. The assessment identified the key areas of difficulty as:
As Treasury official Bushnell confirmed: "To date this goal of departments proving their performance has only been partly achieved. One reason has been the time needed to make and embed changes of this magnitude: lifting the levels of technical and management skills, introducing new systems of funding, reporting, and performance measurement" (op cit).
The US General Accounting Office (GAO) administers the Government Performance and Results Act of 1993 (the Results Act) that mandates annual performance plans in the federal system.24 Congress was seeking to reduce the cost and improve the performance of the federal government, holding agencies more accountable for results and better management. Congress had found that the lack of adequate information on federal agency performance was handicapping congressional policy making, spending decisions and oversight and diminishing federal accountability for program results.
The Results Act seeks to improve the management of federal programs by shifting the focus of decision-making from staffing and activity levels to a results basis. Executive agencies are required to prepare 5-year strategic plans to set general directions and then prepare annual performance plans that establish the connections between the long-term strategy goals and the day-to-day activities of the program managers and staff. Finally, the Act requires that each agency report annually on the extent to which it is meeting its annual performance goals and the actions needed to achieve or modify those goals that have not been met.
In a later report, GAO reviews evaluation studies in 1999 annual performance reports.25 Agencies used evaluation studies to both improve their measurement of program performance and understanding and how might program performance be improved. Not all evaluations were initiated in response to the Results Act; most were self-initiated in response to concerns about a program's performance or about the availability of outcome data. Commonly agencies all faced challenges in collecting outcome data on an ongoing basis. These challenges included: the time and the expense involved, grantees' concerns about their reporting burden, and substantial variation in state data collection abilities.
The interface between policy makers and policy advisors is a fraught one. The Westminster model of democratic government gives the final say to elected policy makers but also provides for an independent public service by way of conditions of service and a convention of providing objective advice. My feeling is that the political side of administration, including the ministerial advisors in that term, is constantly nibbling away at the frontier between the two groups and weakening the independence assumption. This is particularly so where advice from departments is by-passed or thwarted in some way. My idea is that every opportunity should be taken to strengthen the independence role of the public service in any forum that presents itself. Such an opportunity was presented by the MOPS enquiry by the Senate Finance and Administration Committee and is to be applauded roundly.
My second reason for examining this topic was the fact that there are a lot of economists in the public service, particularly in policy advisory roles, who need to be fully aware of their obligations and responsibilities. At the time of my own transfer from academia to the public service (early 1970s) none of these obligations and responsibilities were ever referred to or provided in training. The policy shop appeared to work on the principle of learning by doing. As I found out about them I endeavoured to introduce them to my training courses. So my plea in this area is for a much better training ethic in the public service particularly with regard to public administration and accountability.
Third I would plead for greater pre-entry training in political economy, public administration and institutional economics. Agricultural economists in particular have often come through from agricultural science backgrounds (like myself) with lots of basic science, then production economics and farm management. From todays perspective, such course work was heavily weighted by large doses of agricultural fundamentalism which a student could not recognise at the time. I really don't know how modern agricultural science university courses regard these matters, but up to the time I retired, incoming graduates showed little appreciation of basic civics not to mention the serious restrictions that now apply to Pigouvian welfare models.26
These remarks are confined to the policy advisory branches of the public service. I am not at all well informed about policy formation in the health, education and defence sectors though I suspect that the working conditions are not too dissimilar. It is clear that many of the "government failures" quoted in the daily press are found on the administrative side of government. These do not seem to me to be cases of policy failure unless one can't anticipate all the problems of delivery in original policy proposals going up the chain. On the other hand, it is warnings about weaknesses in delivery of a policy that might be all the more likely to be by-passed or thwarted by the political arm of government. Frank and fearless advice remains the key and the ultimate goal.
1) Paper prepared for the 2004 Meeting of the Australian Agricultural and Resource Economics Society. The author is a consulting economist in Wellington New Zealand (johnsonr@clear.net.nz). Comments from Ian Jarratt (Brisbane) and John Martin (Wellington) have been most useful.
2) The National Interest, Westminster, and Public Choice, Australian Journal of Agricultural Economics, 38, 1994, 1-30.
3) The Role of Institutions in Policy Making, AARES Conference, Sydney, 1999; Improving the Policy Advice Process: The Need for Monitoring and Evaluation, Institute of Policy Studies Newsletter, 70, 2002, 5-11.
4) See R. Johnson , The Role of Institutions in Policy Formation and Delivery, Proceedings of the 24th International Conference of Agricultural Economists, Berlin, 13-18 August, 2000, 243-265.
5) See E C Pasour, Economics and the Public Policy Process: What can Economists Do?. New Zealand Economic Papers 27(1), 1993, 2-3.
6) Adapted from `Building Institutions for a Capable Public Sector?, World Development Report, World Bank 1997, p.80
7) NZ Year Book, 1993, p.26. See also M.McKinnon, Treasury, Auckland University Press, 2003, pp 30, 80.
8) T Plumtre, New perspectives on the role of the deputy minister, Canadian Journal of public Administration 30, 376-398, 1987, quoted by J Martin, Ethos and Ethics, in Reshaping the State:New Zealand's Bureaucratic Revolution, (eds), Boston J, Martin J, Pallot J and Walsh P, Auckland, OUP, 1991.
10) For a brief statement of recent history in England and Australia, see: C. Eichbaum and R Shaw, A Third Force? Ministerial Advisors in the Executive, Public Sector 26, Sept 2003, 7-13.
11) New Zealand Public Service Code of Conduct, Sate Services Commission, 2001, p.13.
12) Political neutrality, Fact Sheet No 3, State Services Commission, 2003, p.4.
13) Fact Sheet, p.7.
14) Annual report of the State Services Commission 2002, pp.15-17.
15) Commerce Commission, Draft Determination in the matter of an application for authorisation of a business acquisition involving New Zealand Dairy Board and others, 1999, p.84.
16) In this particular case the Commission found that the detriments exceeded the benefits of the dairy company merger compared with both counterfactuals and recommended against government approval. This methodology is a good example of sound economic reasoning based on available industry information or that supplied to the Commission. It is an ex ante rather than an ex post analysis and is a sound basis for examining future government policies.
17) `Air cartel's critics counter the counterfactual', The Independent, 5 March 2003.
18) Di Francesco, M., The Measure of Policy Evaluating the Evaluation Strategy as an Instrument for Budgetary Control, Australian Journal of Public Administration 57, 1998, 33-48.
19) In New Zealand, evaluation was not implemented as part of the budget process, but has been encouraged by activities in the State Services Commission (See Johnson R IPS Newsletter, 2002).
20) Ryan, B., Death by Evaluation? Reflections on Monitoring and Evaluation in Australia and New Zealand, Paper presented to BIIA Conference on Public Sector Performance, Wellington, October 17, 1998.
21)Bushnell, P., Does evaluation of policies matter?, Paper presented to a Workshop on Policy Evaluation, Foreign and Commonwealth Economic Advisors, London, February 1998.
22) Di Francesco, M., and Uhr, J., Improving Practices in Policy Evaluation, in Evaluating Policy Advice, Federalism Research Centre, Australian National University and Commonwealth Department of Finance, Canberra, 1996.
23) Chapman, R., Improving Policy Advice Processes: Strategic Outcome Definition, Policy Evaluation and a Competitive Policy Market, Public Sector 18, 1995, 16-21.
24) General Accounting Office of the USA (GAO)1997, Guide to Assessing Agency Annual. Performance Plans, GAO/GGD.10.1.20 (www.gao.gov/special.pubs).
25) GAO, Evaluations Help Measure or Explain Performance, GAO/GGD-00-204, 2000, (www.gao.gov/evaluation).
26) Alan Randall, Methodology, Ideology, and the Economics of Policy: Why Resource Economists Disagree, American Journal of Agricultural Economics, December, 1985, p.1026.