The subject of my statement is the strategic management initiative and its major output, "Delivering Better Government", which is a comprehensive programme of change for the Civil Service. I will deal with the key elements of that and the developments which gave rise to Partnership 2000 and the PPF agreements in supporting it, as well as the role of changed management fund.
The question is why the SMI got under way and a number of factors can be summarised under the headings internal, external and international. First, one had a growing awareness of the rising cost of providing public services and changing and higher expectations of service from the public in relation to the level of service they should have. There was also the growing complexity of Government itself.
On the other side there was a growing awareness on the part of Civil Service management that there was a need for modernisation and change. There was the extension of the Comptroller and Auditor General's remit to cover value for money which was a significant development. There was also the greater use of information technology in the work of the Civil Service.
Internationally, globalisation was having an increasing impact on how governments functioned and there was an awareness of change taking place in other countries, particularly New Zealand and Australia. We were members of the EU and were aware that change was being promoted by the OECD and from elsewhere. All of this gave rise to debate within the Civil Service. My colleague Eric Embleton was centrally involved during 1992-4. This led to the SMI being launched formally in 1994.
What is the definition of strategic management? We define it as the process by which an organisation maintains a focus on the medium to long-term, plans accordingly and implements its plans. It sounds simple but it is a very structured way of doing business. The SMI is concerned with modernising the Civil Service which is the important objective. In so doing it addressed three key issues - how the Civil Service can make a better contribution to national development, how it can provide and excellent quality of service to the public and, in doing so, make the most effective use of the resources which the Government makes available to it. It is also concerned with improving the linkages between Departments and agencies and was designed to be extended to the wider public service.
To make it happen a co-ordinating group of Secretaries General was established under the chairmanship of the Department of the Taoiseach. The role of this group was very important. It was to facilitate the process of reform, to evaluate strategy statements produced by individual Departments and offices, and we will come back to those later, and to recommend changes to enable a more efficient and effective management of the Civil Service by removing barriers to better management. Its report to Government was entitled Delivering Better Government and was a comprehensive programme of change for the public service.
Statements of strategy are for each individual Department and office to set out what its objectives are in a clear manner, to set out how it is going to achieve these objectives and how the available resources it is voted or allocated by Government would be used to this end. In other words, it is a results oriented approach.
The document Delivering Better Government was launched in May 1996 and one could summarise its two main objectives as better government through providing quality service and delivering better government through better management. How was this made to happen? Again a group of Secretaries General has responsibility for implementation. As part of the work programme, individual working groups were established to tease out key areas where change was needed. New legislation was enacted to which I will return. The system also relied on consultation and participation by unions and staff. An important part of the supporting structure was an SMI team in the Department of the Taoiseach whose function it was to monitor and support the process and an all-party committee of the Oireachtas on the SMI.
I will now turn to the legislative programme. The Freedom of Information Act was a key to opening the operations of Government to the wider public. The Public Service Management Act created a new framework within which the public service is managed. I will return to this issue. Other legislation was important in the same vein, including the Committees of the Houses of the Oireachtas (Compellability, Privileges and Immunity of Witnesses) Act, 1997, and the Comptroller and Auditor General (Amendment) Act, 1993. Earlier legislation such as the Ombudsman Act, the Data Protection Act and the Ethics in Public Office Act were also important.
The Public Service Management Act, 1997, came out of Delivering Better Government and provides a statutory basis for a new management structure in the Civil Service. However, this new structure safeguards carefully the unique authority of Ministers as regards policy, the allocation of resources and their responsibility to Dáil Éireann. Within that framework the Act assigns formal statutory responsibility to the Secretary General for managing the Department, implementing and monitoring Government policies, preparing and providing progress reports to the Minister on the implementation of strategy statements, we have already touched on this issue, assigning specific responsibilities to officers of appropriate rank and ensuring effective management of issues requiring a cross-departmental response.
The key elements of Delivering Better Government with an external focus were quality services, better government through quality services, regulatory reform, openness and transparency and better management of cross-cutting issues where significant progress has been made. We will return to the others as I proceed. The key elements of Delivering Better Government with an internal focus were devolving authority and accountability, better HR management, better financial management and more effective use of information technology.
The quality services initiatives commenced in 1997 and involved a set of principles which were converted into action plans by each Department and office. These plans were published. Since then the principles have been reviewed and expanded to reflect the provisions of the equality Act and particularly to recognise staff as internal customers. These will be reflected in revised action plans which will be published in the new year.
The basic drive behind regulatory reform is to reduce red tape and to provide greater accessibility to statutes and so on. There is a quality check list where Departments and offices are required, under amended Cabinet procedures, to use a quality regulation check list for each new legislative proposal. As regards accessibility, statutes from 1922 to 1998 are now available electronically. The Freedom of Information Act came into operation in the Civil Service on 21 April 1998 and has been extended to a number of other areas of the public service. Further extensions are also planned.
Human resources management also needed to be modernised and developed. There have been management initiatives in relation to recruitment, promotion and tenure. Regarding equality, the Civil Service as an employer is committed to a policy of equal opportunity, which includes ensuring that people with disabilities who are capable of effective performance in the jobs to which they aspire are not disadvantaged by reason of their disability. Across the Civil Service there is a target of 3% for such employment.
In June this year the Government issued a new gender equality policy which requires that one third of all assistant principal posts be filled by females within five years. This is to be integrated into the strategy statements of Departments and offices with appropriate goals being set.
In relation to performance management, it was considered particularly important that the existing framework of strategy statements and business plans should be completed by putting in place a performance management and development system. This would bring the business plans down to the level of the individual. Each individual would have objectives. The competencies required to do their job would be identified and, very importantly, any training needed to ensure the individual had these competencies would be provided. It was also considered necessary to refocus the HR functions by delegating more to individual departments and offices and in turn delegating down to the level of the line manager who deals with particular issues.
Financial management was another major area which needed attention and multi-annual budgeting has been introduced. Expenditure reviews are well on the way to a second round. Regarding administrative budgets, Departments have three-year expenditure programmes which allow them much greater flexibility than before to look after their in-house costs. A new financial model is being developed to support this system. This new system is referred to as the generic model because it identifies common features for a financial management system across the Civil Service. It will provide for the standard functions of a financial management system, management and financial accounting, cost allocations and so on, together with developing the use of other financial and non-financial performance indicators. Again, the focus is on results. The new model will facilitate the full costing of programmes and will aim to provide the information needed to measure and evaluate whether the objectives of Departments have been achieved. It will relate expenditure to the costs of delivering a service and to the output of that service. The proposed timetable for the project is identification of requirements to be completed by Spring 2001, the system to be designed by Autumn 2003 and fully implemented by 2005. It is a long period, but it is a very important development in the Civil Service and will underpin many of the changes made to date.
Clearly, information technology is also very important in relation to how the Civil Service is managed and how services are provided to customers. Part of the Action Plan for the Information Society, adopted by Government in July 1999, was to make effective use of IT, to support business activities and objectives, facilitate redesign of business processes and to develop electronic services. The Department of the Taoiseach has a central policy and co-ordinating role. The Departments of Finance, Social, Community and Family Affairs, Public Enterprise and Education and Science also play a key role.
IT is a major agent for change, both in the public and private sectors. In relation to Government it will facilitate interactive service delivery to customers, more integrated services which are designed around customers' needs rather than the organisation of Departments and offices and should result in people being able to get a package of services at a point of contact, rather than having to go between one Department and another.
In relation to e-procurement, the Government would do its own purchasing using technology which would have the added advantage of encouraging business, particularly small businesses, to develop its IT skills.
Partnership 2000 recognised and supported this change agenda. It did so by putting in place a partnership arrangement which enabled targets to be set for delivery of services, and 2% of the pay increase was dependent on those targets being met. Payment was only made when these were validated by the partnership committee.
The Programme for Prosperity and Fairness builds on Partnership 2000. It acknowledges the need for continuous modernisation. It takes as given the fact that the SMI building better government platform exists and acknowledges that the strategic management framework is the way business is done, involving strategy statements, business and service plans, moving performance down to the level of the individual with individual targets and competencies being identified and training provided as required, and quality service delivery to the customer.
The next phase in the programme is to set sectoral specific objectives for the Civil Service, the education sector, the health sector and the local government sector. Performance indicators would be sector specific. The organisation would tailor them to meet their own circumstances and there would be a quality assurance element at both the stage at which the targets are set and to ensure they were delivered upon. On delivery the third phase of the Programme for Prosperity and Fairness, which is 4%, would be paid in October 2002. The payment depends on agreed indicators being in place by April 2001 and being satisfied the targets are achieved by 2002.
In order to demonstrate the intention to support the SMI Delivering Better Government programme, the change management fund was established in 1999 to co-finance implementation of the strategic change agenda. It has a budget of £5 million per annum and is expected to be required for about five years. In 1999 the fund approved spending of £2.4 million for non-IT projects, but only £1.3 million was paid out within the year as demands for payment were somewhat slower than expected. In 1999 the fund also made payments of £1.7 million for IT related projects, bringing the total spend in 1999 to just over £3 million. To date in 2000 the total approved for payment from the fund is £3.5 million. Draw downs are slow this year, totalling only £0.28 million to date. We expect this to pick up as the year progresses. Inevitably, there are gaps between projects being approved and expenditure being incurred.
