State Institutions of Economic GovernanceNew Public Management

1. State Institutions of Economic Governance
New Public Management
Prof. Dr. Mária Bordás
National University of Public Service
Faculty of Public Governance and International
Studies
2020

2. Solutions of NPM to the neoliberal economic policy
 Reform based on restrictions: was not acceptable for the lower
classes
 Interests of the business sphere and the middle class: new
market, lower taxes
 Requirement of efficiency: cheaper state, better quality of
services
 Business principles: applied in the public sector

3. Segments of New Public Management
1. More market and less state
Public Services:
- Should be transformed from public sector to the business sphere
- Business principles: privatization, competition, elimination of entry
Critics:
- Costs of the government: did not decrease
- Economic growth: there is no evidence
- Rearrangement of economic positions and redistribution
- Aversion to the decrease of welfare in Europe
Effects in EU:
- Liberalization of Infrastructure services
- Deregulation programs
- Public Policy

4. Segments of New Public Management
2. Application of Business Principles
 Contracting out:
- Public tasks: cleaning, IT, restaurants, security services –
collecting taxes, jurisdiction, advising, legislation
- The right to provide the activity
 Public Private Partnership (PPP):
- Insufficient financial resources in state investments
- Conditions of the contract: risk
Business principles: copmpetition, profit-motivation, private
property, customer choice, client-oriented operation, civil law
contract

5. 2. Application of Business Principles
Tenders:
- No competition
- Best offer: lowest price and best quality
- Saving costs
Risk:
- Stipulation of the conditions in the contract
- Administrative culture
- Hotbed of corruption

6. Segments of New Public Management
3. Management Means
a.) Public Policy
Phases:
- Selection among the social and economic problems
- Public goal
- Government program
- Achievements: conceptions, alternatives, possibilities, limitations,
risks
- Cost-effectiveness and effects
- Solutions
- Implementation
- Evaluation of performance

8. How to influence public policy

9. 3. Management Means
Features of Public Policy:
- Forming a program, not carrying out laws or
government decisions
- Interdisciplinary views
- Information
- Political and cultural issues
- Legal regulations – effectiveness
- Political and economic rationality, realizable

10. 3. Management Means
a.) New Public Leadership: democratic relationship,
cooperation, motivation, good environment
c.) Performance-oriented budget: expenditures should
serve the real task
d.) Quality-oriented technics: satisfaction of the
customer

11. Influence of NMP in Europe
 Welfare services: can not be more
expensive – against solidarity – NGO-s –
social insurance
 State property: not necessarily in low
efficient – profit-motivation is against public
interest – later: competition is determining
 Customer choice: not in every service –
government has to assure certain services
 Management and business issues: limited

12. New Requirements
Debate on the applicability of NPM in Europe has been
over!!!
2018 World Economic Crises – strong and centralized
state – neoliberalism is accused with world economic
crises.
Neo-Weberian model
 Competiveness
 Adaptation to international economic processes
 Openness
 Accountability
 Accessibility
 Predictability
 Political vs. professional issues

13. Question?