Latest Trend: Decentralised Decision-Making

2nd May, 2012

Kristina Hansen, Public Sector Analyst

We have previously reported that there is a trend in Australian government to shift between the two philosophies of centralisation and decentralisation in cycles of approximately two to three years. True to form, centralisation has been dominant in the public sector for around two years. In that time, huge departmental mergers were enacted in several states – for example the NSW State Government move to merge 13 departments into nine “super departments”.

Seemingly, decentralisation has returned to the centre stage of public sector governance. Over the past several months we have observed how both federal and state governments are increasingly embracing decentralisation, with institutions moving away from centralised decision-making and shared corporate services.

In Victoria, recent news suggests that large parts of the public service sector could be outsourced to the private sector due to a tight state budget and the government trying to deliver a surplus after a deficit during the second quarter of last year. Premier Baillieu’s axe is likely to fall on shared services and whole-of-government style agencies. Public sector cuts, outsourcing and privatisation are expected, with the Victorian government looking into “private sector involvement in service delivery”.

Furthermore, with a new liberal government, Queensland has prioritised decentralisation of government decision-making. During the last days of his campaign, newly elected Premier Campbell Newman released his policy for public service, stating that he would dismantle and separate the 13 “super departments” created by Labor, decentralise public sector positions and move roles out to the regions. The number of QLD government departments has now been increased from 13 to 21 and agencies are undergoing restructuring.

The trend to decentralise decision-making also shines through in the domain of school education. This is no news in Victoria, where school reforms changed the education system in the 1990’s and gave more autonomy to individual schools. Whilst it has taken longer for other states to adopt the trend, it is gradually being implemented as part of the federal government “Empowering Local Schools” plan. The $480.5 million initiative will hand over responsibilities of financial and budget management to school boards and principals.

In 2011, the NSW school education system announced a shift in control of individual schools. Through the pilot program “Local Schools, Local Decisions”, 70 per cent of the budget management of schools in NSW is to be transferred to principals, as opposed to the current 10 per cent. Furthermore, a joint initiative between the Commonwealth and the ACT was launched recently to hand over more control to ACT schools and their budget management. This initiative will be implemented over the next two years, giving schools the flexibility to make unit-level decisions concerning funding.

Throughout the public sector reforms and initiatives are prompting decentralised decision-making and A-ZGovBIZ is keeping a close eye these changes.

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