Introduction

Olena Biedova

APEP 2014-2015

TODAIE

The final research on subject: Public Administration theories

“New public management”

INTRODUCTION

The public administration reforms from the late 1970s have led to a revolutionary change not only in the manner of delivery of social services and accounting for government expenditures, but also in the structures of governance. These reforms towards marketisation, or the application of business management theories and practices in public service administration, came to be called, in professional parlance, the New Public Management (NPM) [17].

New public management (NPM) is related to the changing balance of power between economic theories since the 1980s. The economic doctrines of Keynes, which ruled after the Second World War, grew outdated in the 1980s. Keynes’ economic theory could not explain stagflation, a combination of inflation and long-term unemployment. Consequently, the Keynes theory was attacked by three alternatives: monetarism, supplyside economics and public choice theories. The combination of these ideas is collectively known as neo-liberalism. Economic neo-liberalism is currently in deep trouble as a consequence of the worldwide financial crunch. After more than 30 years of ideological hegemony, neo-liberalism today seems powerless to explain developments in the real world. Does this also have an effect on the ideas of new public management, clearly an offspring of neo-liberalism? Ideas about paradigms and paradigm shifts are based on the work of Thomas Kuhn. He makes a distinction between periods of normal science and revolutionary science. Reality can be observed through a new theoretical lens following a paradigm shift. However, according to Kuhn, an old paradigm will not disappear immediately. Kuhn’s theory was used by Peter Hall to examine and understand the change in economic policy making in the United Kingdom. When Margaret Thatcher came to power, the dominant ideas of Keynes were replaced by neo-liberalism. Hall elaborated on the theory of paradigm shifts and connected this with decision-making and policy-learning theories. According to Hall’s theory, there are three possibilities for change: changes of the first, the second and the third order. A first-order change is very small: a marginal change. A second-order change is slightly bigger, but is still incremental. A third-order change is a general paradigm shift. Small changes are a consequence of technical learning by civil servants and specialists. A general change is a consequence of societal learning. A general or paradigmatic change is mostly the result of a crisis or anomaly [8].

Among the many approaches to the organization of the state (public) management the " new public management" played a special role in connection with a high focus on the effectiveness of this model. The new model of public administration was the result of a long period of searching for its performance, which began when major powers on the eve of the global challenges faced to lack of resources. The main features of the new model of governance have been borrowed from the private sector. The design of the organizational model and governance practices occurred in the second half of the 70's. XX century, which is associated with initiatives Prime Minister of Great Britain Margaret Thatcher and US President Ronald Reagan. Thus, the governments of most developed democracies (regardless of what political force they formed) felt the presence of the general need for administrative reforms and went on partial or radical restructuring of public sector management, albeit at different times and with varying intensity. How wrote D. Osborne and David Heybler, " necessity spawned updating the system of public administration" [11]. The greatest intensity in reforms noted in Anglo-Saxon countries. In the center of reform an issue of efficiency in all its forms - economic, social and organizational. For example, in the US mid-1990s. " 39 states reported on the introduction of measures to improve the quality of governance" [11]. Thus, it was found political will which has led to positive results.

New Public Management as a concept and model of governance shape in the 80s. It was a response to the crisis in public administration built on the principles of bureaucracy, hierarchical organization, centralization, the stability of the organization and the public service, unity of management, administration. In many respects, the concept of New Public Management and the corresponding reforms were stimulated criticism costly nature of the policy of the welfare state and a sharp drop in public confidence in the public administration. Out of the crisis public administration saw a lot of ways to rethink the theory of governance on the basis of assumptions of management as business management in a market economy. The most active market concept of governance is being developed in the UK, United States, New Zealand, Canada and has its supporters in France, Germany, the Nordic countries and Japan.

Market type of government puts quite obvious in administrative reforms 80-90-ies in a number of countries. This process is expressed in terms of the transition from public administration to public management. With regard to the theory of organization it is characterized by two main points: increased autonomy of the lower floors of hierarchical government organizations and movements with proper emphasis on the construction of the organization of its relationship with the environment. Features of the transition to public management is reflected in the commitment to action and change rather than stability, a certain rate; the principle of subsidiarity in the modern organization management, which should be closer to the customer, characterized by decentralization and the relative freedom of all its parts; actively choosing a manager at any level, which would serve the public interest and the interests of a particular person; new criteria for the effectiveness of the system of government based on the quality of service and profitability. The key issue of these trends in the theory and practice of public administration is to find an effective model of state and government. New Public Management is based on the assumptions of rational choice theory [10; 14] and market facilities regarding public affairs, emphasizing competition and / c. 212 / choice, sharing of resources and optimality. Although within this trend there are different approaches - Quantitative Analysis, Political Science, the managerial market [16], but each of them is under the influence of the economic approach to management. As a result, the rational choice theory and neoinstitutional economy have become almost synonymous with the theory of public management. The second source of intelligent new public management are managerialist doctrines, emphasizing the " freedom to manage" and measuring the effectiveness of government [7, 5-6].