sou · GVB375 · 2008-01-01 00:00:00 — So, two important ideas must be combined at the same time in the relationship between the Government and its agencies. On the one hand, the politicians decide and the administration executes. On the other hand, the agencies have to speak up with a clear voice – they have to speak truth to power, to borrow Wildavskys classic formulation. But agencies speak truths from their own perspectives. The democracy perspective means that it is the Government that decides in what respects and to what extent it wants to govern its agencies. There can be considerable variations in the steering of agencies because agencies and their activities are very different. It has long been a central assumption that it is possible to distinguish between political and value-loaded aims, on the one hand, and a more value-free technical instrumental level, on the other. The role of the politicians is to govern using aims, and the role of the agencies is to decide how to achieve these aims. The notion of such a dividing line is problematic, in part because the agencies have only limited access to the means, but also because the means are often politically loaded or controversial. In politics, views frequently differ about what value to attach to various aims and instruments. The same activities may have different aims, and different groups can argue for one and the same thing from different perspectives. There may frequently be con- flicts between different aims. In politically governed activities it is often hard to overview – and reach agreement on – different causal processes. Even though a number of measures have been taken over the years to reduce various social problems, these problems sometimes remain unchanged, even after a very long time. It may seem reasonable to look for the causes of these failures in the way agencies operate and how the Government governs its agencies. But the question of what circumstances in society can be in- fluenced by state intervention is a separate matter from the question of how to govern agencies. It follows from this per- spective that it is important to have more realistic expectations about what can be achieved or brought about by changing how agencies are governed. 3.2The role of aims and objectives At the political level aims are used to express a long-term political ambition. These overall political aims have then to be transformed into firm steering of agencies. The political aims have often been translated into objectives at various levels where the causal connections between aims and objectives are not self-evident. Moreover, the political discussion is often not about overall aims but about objectives that are to be found much lower down the chain of objectives. do the agencies have access to alternative instruments that they could use to reach an overall aim. For these reasons, among others, we are very doubtful about the notion that outcome related or impact related and more overarching objectives are a good way of transforming political ambitions into the steering of agencies. In- stead, we underline that the agencies have been set up to run specific activities, such as handling a transfer system or exercising supervision. This is not to say that there are no overall aims or objectives for these activities. However, tasks assigned to agencies are an expression of the politicians view and assumptions that certain activities can contribute to fulfilling these overall aims or objectives. Political ambitions are often formulated in visionary or overarching aims but are not suitable for the concrete steering of agencies. This means that a central part of work in the Government Offices must be to carry out analyses of how these overarching aims can be translated into tasks and remits for agencies. The agencies have to carry out their mandate irrespective of whether the Government chooses to express it in terms of outputs or in terms of outcomes or impacts that are closer to or further from the agency. How the mandate is formulated is something that must vary from agency to agency. However, it must be formulated so that is can be achieved within the framework of the agencys powers. In recent years there has been a lot of discussion of fragmentation and sectorised service delivery in agencies and to what extent this is a major problem. In this discussion it is important to distinguish between two situations. The first is that there are strong operational links between the activities of many agencies; indeed the links are such that their activities can be described as parts of a production chain. The second is that several agencies can be assumed to influence the same aim or objective without there being links between their activities. Coordination between agencies is sometimes made more diffi- cult by too strong a focus on the individual agencies without taking account of the fact that the activities of an individual agency sometimes form part of a process in which several agencies participate. But the fact that many activities have common aims or objectives does not automatically justify coordination. If the aims or objectives are framed in a sufficiently general way, sooner or later they will cover just about all central government activities. In such a situation, administrative systems for the continuous analysis of the relationships between different aims and objectives would unavoidably lead to technified analyses of objectives and links. Such analyses would rapidly lose their importance as a tool that the Government could use in setting priorities between or shaping different activities. Agency steering and the working procedures in the Government Offices must support and not hinder coordination between agencies. Analyses of what activities can contribute to various political aims and objectives should be made on an ad hoc basis and in forms that are suitable for the Government. 3.4Limitations of the budget process The system for steering agencies has been built around the idea that it is possible to reassess central government activities within the framework of the annual budget process. Even though few in the Government Offices and in agencies see this as realistic, it is clear that this idea has been important when various reforms of this steering have been proposed and implemented. This has contri- buted to a short-term perspective in the steering of agencies and to unreasonable and uniform requirements on agencies to provide information. The idea of reassessing all central government activities in the budget process is unrealistic. can substantial reassessments be expected to be carried out within the framework of the annual budget process. 3.5Informal contacts – part of the steering process The decisions through which the Government formally binds the actions of agencies are taken by the Government as a collective. When we talk about formal steering we are only referring to these decisions. Informal contacts between politicians or officials in ministries, on the one hand, and officials in agencies, on the other, are unavoidable as well as desirable and are important for steering and the exchange of information. One key feature is the annual results dialogue between the political leadership and the leadership of agencies. There are considerable differences between areas in informal contacts, partly because of the need for and intensity of contacts with the EU and the political importance assigned to various activities. We have been able to conclude that there is currently considerable uncertainty both about the possibilities of governing through informal contacts and about whether informal contacts are appropriate at all. We draw a sharp distinction between contacts that relate to questions covered by Chapter 11, Article 6 of the Instrument of Government that the Government can take decisions on and questions that the Government is unable to take decisions under Chapter 11, Article 7 of the Instrument of Government, i.e. in cases relating to the exercise of public authority vis-à-vis a private subject or a local authority, or relating to the application of law. In questions covered by Chapter 11, Article 7 of the Instrument of Government, contacts have to relate to information, to the extent that they occur at all. On the other hand, we advocate informal contacts in matters that the Government can decide on under Chapter 11, Article 6 of the Instrument of Government. However, this exchange presupposes that both the Government Offices and the agencies know what is actually permitted. What role an agencys activities play in realising overall political aims is frequently unclear both to the individual agency itself and to external stakeholders. Even in cases where an agency does a good job, and the head of the agency has acted with skill, it can still be the case that the overall objectives of its activities are not achieved. This means that the responsibility of the leadership of an agency cannot be tied to results in relation to higher-level aims and objectives that the agency itself does not have in its control. Accountability has to be linked solely to what the leadership of an agency has immediate responsibility for and can control. How- ever, the Government must also be able to make a more general assessment of what confidence it has in the leadership of an agency. The factors considered in such an assessment vary, and ought also to vary, both between different activities and between agencies. In our assessment, agency heads are already being called to account today and assessments relating to confidence are already being made on a larger scale than is usually assumed. This means that there is no reason to set up new, special formal procedures to call heads of agencies to account over and above those that are in place today. 3.7Knowledge and information for decision making In monitoring and evaluation it is possible to ask an almost unlimited number of questions. The possibilities of answering these questions vary. It is often possible to answer questions about the development of various outputs or of various external circum- stances, even though there may be difficulties of a more technical nature. We are confronted with considerably more challenging problems when we have to answer questions about outcomes and impacts, in other words about whether it is central government activities that have caused a particular change in society. This means that there are considerable limitations in using evaluations to say anything more specific about the outcomes and impacts of central government activities. Different kinds of information are needed in different decision situations. Ongoing steering requires information with a high degree of regularity. The agency responsible for activities in an area plays an important role in the production of this information. If, however, we consider fundamental reassessments, it is hard to predict what information will be needed. The information sought by decision-makers in such a reassessment is intended to shed light on alternative courses of action. Future alternatives can seldom be illuminated solely by evaluations of limited actions or existing activities. Other forms of knowledge must be brought into the decision-making process. Today there is a risk of exaggerated expectations of the importance that evaluations can have in more fundamental reassessments. There is reason to make quite different demands on information depending on how it will be used. Different types of information should be ordered and produced in different ways and be sourced from different producers. Agencies have to inform the Government about how they have discharged their remit. The information required from agencies has to be linked more clearly to the tasks that agencies have than it is today. In recent years the link between results information and finan- cial information has been regarded as a problem. The discussion has mainly been about central governments costs for certain types of activities, what resources central government assigns in relation to certain aims and objectives and central governments costs for achieving certain aims and objectives. Such information can only be produced on an ad hoc basis, and in certain cases it requires extensive surveys and analyses. This information is frequently of limited relevance. In their annual reports, agencies should be able to give information about their activities and about the costs of their outputs. Today such information can be obtained from their accounting systems. Complex surveys of different links between costs and results must be carried out on an ad hoc basis and with an acceptance of a large measure of uncertainty. This applies both to the volume of resources being used by central government to achieve a particular aim or objective and what costs central government has actually had to achieve a particular aim or objective. We put forward a number of proposals for change, based on our fundamental view and our standpoints. 4.1Agency steering has to build on the differences between agencies Government agencies are of very different types and they cannot be divided into a number of distinct categories based on how to steer them or how much steering should be applied. One of the most demanding professional tasks for officials in the Government Offices should be to give advice on how to design agency steering in specific cases. This perspective means that the Government Offices should devote less energy to the routine, ongoing, single-year steering of individual agencies. This will make it possible to devote more energy instead to strategic steering focused on how the activities of different agencies taken together can help to realise political ambitions. The operational part of todays appropriation directions frequently contains few additional signals about steering. It is com- mon to have repetitions of tasks already specified in the agencys instructions or in other provisions. In the Ordinance containing the agencys instructions the Government should specify the tasks it has assigned to the agency in order to achieve the aims and objectives sought by the Government through the activities of the agency. Informal contacts can be developed further and can be semi- institutionalised in certain cases. It is important that the ministries conduct regular discussions with their agencies about the form and content of these contacts. All in all, our proposals will make it possible to free up a great deal of time in the Government Offices and also in agencies. This time can instead be used for work on analyses and reassessments and to improve the reporting of activities to the Riksdag, for example. We therefore propose the following: The Government ordinances containing instructions for individual agencies will be the key documents for the steering of agencies by the Government. The instructions of individual agencies should clearly state the mandate of the agency. They should be formulated in terms that match the agencys powers and capabilities. The instructions will not have any direct link to the annual budget process and will apply until further notice. This will provide the possibility of making agency steering smoother. The operational part of the appropriation directions will be abolished in general. In the future the Government will only specify the financial conditions for each agency in its appropriation directions. It should normally be possible for the agency to take operational decisions with a time horizon of only one year by itself within the framework established by laws and by its own instructions and other ordinances issued by the Government. The forms for informal contacts should be discussed between ministries and agencies. uncertainty about informal contacts must be eliminated through training and by other means. There is considerable uncertainty both in the Government Offices and among agencies about what is permitted or not in the area of informal contacts. It is important that everyone concerned seeks to arrive at a shared view of the importance of informal contacts. Nevertheless, it goes without saying that, just like today, there will be great variations in the volume of informal contacts. In the future, results dialogues should still be held each year with all agencies. However, they should be well prepared on both sides and deal with each agencys core activities. The Government Offices should further sharpen its procedures in this respect. 4.2The common activity structure The possibilities of producing information about central govern- ment activities on the basis of the overall aims and objectives do not correspond to the requirements made by the common activity structure currently applied to all central government activities2. This structure is based on incorrect notions about how objectives – from overall political aims and objectives to objectives at the lowest operational level – can be broken down step by step. can results information be aggregated in the way assumed in the com- mon activity structure. The development of various documents has also been very adversely affected by this common activity structure without the intended aims being achieved. The common activity structure will be abolished. There is a legitimate need to divide up central government activities and the national budget in various ways. This was also the case even before the present common activity structure was introduced. It is natural for these divisions to change over time. Our proposal to abolish the common activity structure is based on the present design of that structure and incorrect assumptions made about the possibility of breaking down objectives and aggregating informa- tion. So it does not apply to the suitability of dividing up activities. 4.3The Governments and the Riksdags need of information Decision-makers need access to relevant information about activities and about developments in various areas of society. Supporting material is needed both for fundamental reassessments and for the information the Government has to present to the Riksdag. According to our terms of reference we also have to consider the existing possibilities of and limitations on reassessing central government activities and agencies in a systematic way with the aid of results information. We have drawn the conclusion that no special forms or orga- nisational solutions are needed to satisfy the need for information when conducting reassessments. Based on how we see reassess- ments of central government activities, this task will be governed by the politicians and be adapted to each specific situation. The forms for work on reassessments both can and should vary. 2 Since 2000 a specific activity structure applies to all central government activities. It breaks down aims into objectives at three pre-determined levels. The intention is for information at higher levels to be obtained by compiling information on results at lower levels in this hierarchy. way these questions are currently locked into annual budget work has led to ritualised processes. Our standpoints also give the agencies a different and more realistic role in producing information for the Government. Our view of how the mandates of agencies are formulated means that agencies should be able to report each year on how they have discharged their mandate. However, it should be possible after dialogue with the Government to report parts of their activities at a more general level and to give an in-depth report at longer intervals. Agencies will report their focus, scale and costs concerning the tasks assigned to them by law, their instructions or other Government decisions. The agencies are generally in a good position to say what infor- mation best describes their own activities. The current budget documentation presented by agencies will be replaced by calculation documentation for the coming budget year to be submitted no later than . The proposal is intended to counter the development of the agency budget documentation in the direction of the very detailed appropriation requests of the past. If the agencies wish to submit special analyses or if the Government requests them, this should be done through a separate procedure. The information relevant for reassessments of the remit of one or more agencies should mainly be produced outside the agency or agencies concerned. These reassessments should be initiated on an ad hoc basis. When more extensive reassessments are initiated they should be facilitated by making higher demands on the ability of the Government Offices to identify where relevant knowledge is to be found. The system of Government-appointed commissions, committees and inquiries should be used more strategically. The conditions for conducting reassessments should be improved. We reject the idea of introducing a fixed, routine procedure for the Governments reassessment of the remit of one or more agencies. Such reassessments will be made on the basis of what is of political importance at that particular time. However, this ad hoc approach must be weighed against the fact that there can be certain situations when such reassessments will be triggered quite automatically, for example ahead of the appointment of a new head of an agency. In contrast, as regards more extensive reassessments of, for example, aims, objectives and instruments in a particular area, the Government Offices will have to be better than they now are at providing the politicians with supporting information. This is also a natural task for the Government Offices, as part of its day-to-day work. It is important that questions concerning knowledge and information for policy are not reduced to a matter of evaluations. Finally, it should be possible to make more use of commissions, committees and inquiries appointed by the Government to obtain an overview of what knowledge and what research areas can provide supporting information for reassessments. The Budget should be a strictly forward-looking document. The Annual Report for Central Government should be the key reporting document for central government activities. This proposal affects the scope of the Budget and the process concerning the drafting of the Budget . The tighter focus of the Budget is based on the Annual Report for Central Government becoming the main reporting document. The Government will describe developments in various areas of society and analyse their effects on central government activities in special Government communications to the Riksdag. When the Budget is given a tighter focus, a legitimate need will arise for other kinds of reports. This information need consists of two separate parts. First, information about developments in various areas of society and, second, information about to what extent these developments have any links to central government actions. We do not propose introducing any specific legislation to regulate the provision of this information. It is the Government that must decide what communications it intends to present to the Riksdag. Moreover, the Riksdag can make its views known in some suitable way on what information it wants to receive. Put into practice, the view that we describe in this report will have consequences at several levels. The proposals we present will have certain immediate and obvious consequences for work in the Government Offices and agencies and for the relationship between the Government and its agencies. However, we think that our proposals will also create condi- tions for other consequences that will be more important in the long term. But these consequences will not follow automatically from an implementation of our concrete proposals; instead they will only occur if consciously sought.