I was tempted to call this post “A Poverty of Honesty”, but on reflection it has more to do with the adage of “Do More With Less”. I don’t usually make political statements, but this time I will make an exception. Here in Australia a change of government has seen a rationalisation and tightening of belts of various public service departments. Almost every department has been told to achieve savings of between 5% and 12% annually. In most cases these departments are supposed to achieve recurring savings of this magnitude every year for the next ten years. Now at the practical level I have a few problems with this.

Let’s use the example of one of the larger departments. I know for this department 5% of budget is about a billion dollars. So there is no confusion that translates to one thousand million dollars - $1,000,000,000 – that has to be found every year for 10 years. To put it another way that is almost three million dollars every day for ten years! (It’s $2,732,240 to be exact, but why quibble over a quarter of million?) One of the smaller departments has to find 12% every year. For them 12% is in the order 80 million dollars, or about two hundred thousand dollars a day, every day for 10 years! So how are these astronomical numbers going to be found?

Well according to the senior leadership of these departments some savings will be achieved through the natural attrition of staff. Read the recruiting brochures of these departments and seemingly working in the public service is a “job of choice” and “people matter”. They matter to the extent that million-dollar savings will be achieved through the natural attrition of staff – that is, as someone retires, or leaves, or is promoted, they won’t be replaced. Presumably that means someone else will pick up the slack and have some new and interesting tasks!

If our public service departments really are so inefficient that these types of savings are possible and realistic, why do the senior managers and the CEOs still have a job? Why are they still drawing six figure salaries? Remember in one case we are talking three million dollars a day every day for 3,552 days! People get sacked for being far less incompetent in other areas. It seems to me there is a poverty of honesty here.

First the government expectation seems quite unrealistic when reduced to dollars a day. Maybe the targets are aspirational? Frankly I’m quite happy to have an “inefficient” health service, so long as it’s effective! Who cares if 100% of the hospital beds are filled? I’d rather see 80% of them filled and know I can get one when I need it!

Second the implementation of policy is dishonest and inconsistent. “We will achieve some of these savings through natural attrition of staff”, but the public service is a “job of choice” and “people matter”. They might achieve savings through natural staff attrition, but at what cost? I said in my post ‘Time and the Implicit Psychological Contract ’ that:

“Knowledge workers are educated thinking people. They expect their efforts to be acknowledged and rewarded appropriately. They expect some variety in their work, as well as a degree of autonomy. They expect the loyalty they show to be reciprocated and to be treated with respect. They expect task assignment to be realistic. A lot of this comes down to perception management.

There is clear evidence in the management literature that the implicit psychological contract is breached when knowledge workers perceive that others have broken promises, or failed to deliver on commitments, or have completely unrealistic work output expectations. Why then do so many senior managers, who are knowledge workers themselves and also have implicit psychological contracts, set unrealistic goals and tasks?”

It seems to me task assignment is about to become, if it isn’t already, quite unrealistic. It also seems to me the implicit psychological contract has been breached, or is about to be breached. So where does this leave us?

Well I think we are heading down the path of a disillusioned public service. The service will try to be efficient at the expense of being effective, and achieve neither goal. We will see more outsourcing, right-sizing, reshaping and so on, all at the expense of people and ultimately customers. A consultants and contractors paradise is on the horizon as they pick up the slack! From a knowledge management perspective we will see the transfer of knowledge from the public service to private enterprise, and the taxpayer will pay a premium to access it.

Thank goodness I am not a public servant because clearly people do not matter! As a taxpayer who accesses public services will I continue to matter? I doubt it - until the next election!

Regards Graham