Brian Easton says it's all very well cutting the backrooms of public agencies but it may compromise the frontlines

This is a re-post of an article originally published on pundit.co.nz. It is here with permission.

One of the frustrations of the Productivity Commission’s 2017 review of universities is that while it observed that their non-academic staff were increasing faster than their academic staff, it did not bother to analyse the trend.

In today’s jargon it found that staffing in backrooms was increasing faster than in the frontline. This need not be a bad thing. For instance, the police force’s backroom includes ‘unsworn’ officers who carry out clerical tasks, relieving the sworn officers to spend more time on the frontline. On the other hand, academics have complained that their administrations have asked them to fill in forms compiled by people who had little idea what academics actually do; some ignored the forms – their institutions still seem to be running much as ever. For another example – one hears more grumbles than good reports, but that is the way of anecdotes – doctors were outraged to learn of an ethics unit in a DHB which seemed unaware that medical professions have been struggling with ethical dilemmas since before Hippocrates and did not consult them.

Sadly, the Productivity Commission flubbed the opportunity to carry out a detailed case study of the relationship between the frontline and the backroom despite it apparently being central to university productivity. Nor have I been able to find any other useful study. We rely on the treacheries of anecdotes.

The issue has become most pertinent recently with the government instructing its agencies to cut spending by 6.5 percent and more without compromising their frontlines.

Some of the cuts were easy. The Department of Internal Affairs is cutting most of the 400 plus staff who were working on the Three Waters program which the Government has abandoned. Cutting a service is a simple way of cutting staff (although this may be cost shifting and the jobs will reappear in local authorities funded by ratepayers). However that does not explain the rationale for most of the cuts.

Apparently, the Government thinks that a lot of backrooms jobs are not productive and can be dispensed with at little cost to the provision of public services. Where it got the notion from is unclear. It might be that they think they are mainly bullshit jobs although that problem is more bullshit work – only part of the total activity. (It occurs in the private sector.) That other activity may be critical is the effectiveness of those on the frontline.

The government agencies seem to have concurred with the Government view by cutting more than 3000 jobs. If those jobs can be dispensed with, does it mean that the agencies’ Chief Executives were running some highly inefficient operations? Were they all that inept? How come we appoint such amateurish senior managers?

Of course. not all were, but the effective Chief Executives who were already running lean backrooms were given similar targets to the others. That sounds neither efficient nor fair. (One has an uneasy feeling that those Chief Executives who have made the biggest cuts will be promoted, rather than demoted for running over-staffed administrations.)

The quantity target for the 6.5 percent cuts (plus a further 2 percent directed by the previous Labour Government, while some agencies had a further 1 percent added) seems to have come from the need to fund the Government’s promised income tax reductions. Presumably, this reflects its judgment that the private sector is carrying too much of the burden of the struggling economy; it is the view on which they got elected (although whether electors really understand their policies is moot). The Government may be right, although one would prefer that they were getting the savings from cutting programs and services rather nebulous backroom reductions.

But now the Government is saying it is doing the cuts in order to increase the number of workers on the front line. How that connects to income tax cuts is a bit puzzling – we await the 30 May budget to find out.

The claim one can easily shift resources from the backroom needs to be treated with caution. It is treating workers as fungible – easily interchangeable – like financial instruments. They are usually not. Obviously, some of the teachers working in the Ministry of Education can go back onto the front line. But what about those who have been working in the DIA’s Three Waters program? Give each layoff a shovel and tell them to fix a sewer?

I do not have answers to such questions. I wonder if they even occurred to the Opposition backroomer who invented the policy. That boffin is probably now an adviser in a minister’s office still as dependent upon anecdotes but beginning to face the realities which the Opposition are privileged to avoid. Ministers may be getting poor servicing, while the public may soon be suffering from poorer quality public services and cost-shifting onto them. (It might help if public servants drew more attention to the deteriorating services the public are getting and less to their own suffering – real enough though it is.)

Underlying this column is the concern that our public service is not well managed and its performance will further suffer as a consequence of these cuts. I am not making a party-specific criticism here. It is long since we had a minister of public services who seemed competent and genuinely interested in their quality. (And we have had some dud chief executives too.)

In fact, the quality of our public service is remarkable given the way it has been treated. But there is a general feeling that the quality is deteriorating, slowed only by the inertia inherent in the system. (Which may surprise, since we usually grumble about public sector inertia.)

What is needed is a thorough review. I do not mean a Royal Commission, but some solid research which focusses on nuts and bolts issues – like how public sector backrooms actually work. Without such a better understanding, cutting staff is compromising the effectiveness of the public service to the cost of the public and the politicians they serve.

*Brian Easton, an independent scholar, is an economist, social statistician, public policy analyst and historian. He was the Listener economic columnist from 1978 to 2014. This is a re-post of an article originally published on pundit.co.nz. It is here with permission.