Australian Politics and Policy - Senior, 2019a

The public sector
Figure 2 Public sector employee numbers, June 1990–2017. Source: ABS 2018.
The period of NPM largely replaced the highly centralised state, with its
monopoly over policy design and delivery, with a new set of relationships between
government and other societal sectors and players. These relationships gave
governments a choice between traditional delivery via public sector organisations,
market and quasi-market approaches, and networks, 33 and hence greater flexibility
in responding to the demands and expectations of citizens, who had been given
choice and agency as ‘customers’ by NPM.
By the mid-2000s, NPM was losing its status as the predominant paradigm
for public sector organisation. Key elements of NPM had been reversed or stalled,
amidst concerns about the fragmentation of the public sector and its services
and loss of accountability and capability summed up as ‘the hollowed-out state’. 34
Criticism of NPM highlighted its narrow focus on efficiency and its implication that
‘the public nature of what governments do is not particularly important’. 35
Indeed, NPM’s emphasis on ‘management’ appeared to some analysts to ignore
theprofoundeconomicandsocialchangesthathadgivenrisetopublicsector
reform in the first place. These developments required more fundamental changes
to how political institutions and public expectations interacted and were managed. 36
Nevertheless, many elements of NPM are still in place, such as performance
management and budgeting and market-based competition for some services. The
33 Peters and Pierre 1998.
34 Bevir and Rhodes 2011; Dunleavy et al. 2006, 468.
35 Peters 2017, 607. See Halligan 2007 for a discussion of the particular causes of departure from
and reaction to NPM by governments and bureaucracies in Australia and New Zealand.
36 Kettl 2000. See Pollitt and Bouckaert 2011, 15 for an overview of the difficulties involved in
assessing the impact of NPM and its successors.
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