NPM & Reinventing Government | New Public Management (NPM)

What IS NPM?

  • A management philosophy used by governments to modernize the public sector.
  • A broad and very complex term used to describe the wave of public sector reforms throughout the world since the 1980s.
  • The main hypothesis in the NPM-reform movement is that more market orientation in the public sector will lead to greater cost-efficiency for governments.
  • NPM reforms shift the emphasis from traditional public administration to public management.
  • Key elements include various forms of decentralizing management within public services (e.g., the creation of autonomous agencies and devolution of budgets and financial control)
  • increasing use of markets and competition in the provision of public services (e.g., contracting out and other market- type mechanisms)
  • Increasing emphasis on performance, outputs and customer orientation.
  • NPM – techniques and practices are drawn mainly From the private sector.
  • NPM reforms have been driven by a combination of economic, social, political and technological factors.
  • A common feature of countries following the NPM route has been due to economic and fiscal crises, which triggered the quest for efficiency.
  • In the case of developing countries, reforms in public administration and management have been driven more by external pressures and have taken place in the context of Structural adjustment programmes, include Lending conditionalities and the increasing emphasis on good governance.

What Are NPM Features and Practices ?

  • Result Oriented Govt.

          – Focus on results and not on conforming to procedures.

         – It measures the performance of public agencies focusing on outcomes, not on inputs

        – It is motivated by goals, not by rules and regulations

  • Market-like competition- Government must promote competition among service- providers through;

        – Out sourcing or contracting out

       – Competition and end to monopolies

       – Reorganizing public corporations on private best business practices.

      – Introducing corporate governance systems

     – Preferring market mechanisms to bureaucratic mechanisms

  • Treating public as customers and not as ‘cases’

      – It re- defines its clients as customers and offers them choices

  • Government should be deregulated
  • Introducing public-private partnerships
  • The less the government the better it is.

       – It must empower citizens by pushing control out of the bureaucracy into the community

  • Empowering the employees and promoting team work.
  • Introduce innovation and technology in administration
  • Financial management, improved accounting, expenditure controls-budget cuts
  • Democratization and enhanced citizen participation
  • Decentralization

       – It must decentralize authority and promote participative management

  • Accountability for performance

      – Performance auditing or Value –for- Money Auditing

NPM Analysis

  • The NPM has presented itself as an alternative to the traditional “bureaucratic” way of conducting the public’s “business.”
  • The NPM holds that government should engage in only those activities that cannot be privatized or contracted out.
  • Market mechanisms should be employed wherever possible so that citizens will have choices among service delivery options.
  • the New Public Management suggests that public managers “Steer rather than row,”
  • That they move toward becoming monitors of policy implementation or purchasers of services rather than being directly involved in service delivery itself.
  • In NPM, there seems theoretical commitments to such ideas as public choice theory and agency theory.
  • In general, NPM uses economic models in the design and implementation of public policy

Questions Regarding NPM IN CSS Exam :

  • Q. 1. Explain the basic theme and theoretical bases of the ‘New Public Management’. What are the different mechanisms, that have used in pursuing NPM goals by the governments in different parts of the World, especially in Pakistan.
  • Q.2. Write short notes on any FOUR of the following: (a) E-government in

              Pakistan  (b ) Judicial activism  (c ) F. Taylor’s “Scientific  Management

              Theor y ” (d ) Theory X  and  Theory Y  (e) New Public Management Concepts.

  • Q.3. Compare and contrast the Bureaucratic Model with New Public Management (NPM). Do you think NPM has replaced the bureaucratic approach to public administration? Support your views with examples from Pakistan

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