While economic and political systems vary across APEC member economies, delegates agreed at a seminar in Da Nang, Viet Nam on the importance of good public sector governance that can strengthen the voice of voters and taxpayers. This year's seminar contributes to the ongoing work that the APEC Economic Committee will undertake as part of the APEC Leaders' Agenda to Implement Structural Reform. The topic has received an increasing level of interest in recent years as a way to boost an economy's welfare.
"The government constitutes a large percentage of each APEC member economy, and is responsible for providing services that would not otherwise be available," said John Whitehead, Secretary to the New Zealand Treasury, stressing the importance of public sector governance in his address to seminar delegates. "The government is a major provider of infrastructure and many forms of social assistance." Good governance increases the accountability of the public sector by transparently communicating public sector objectives and outcomes.
But according to Professor Stephen Bartos of the Australian National Institute for Governance, governance is often misunderstood. Governance affects the long-term state of an organization and is different from day-to-day management. Governance is "the processes whereby decisions important to the future of an organization are taken, communicated, monitored, and assessed," explained Bartos.
"The public sector faces an extra burden of proof," suggested Whitehead. Governance, which aims to boost performance, faces a unique set of challenges because the public sector faces no competition. Conversely, the private sector is constantly forced to innovate and improve efficiency in order to stay ahead of competitors. "Although the state sector enjoys a monopoly, it is often not a perfect monopoly... competition can often still be applied," added David Parker, a Deputy Secretary at the Australian Treasury.
All of the speakers agreed that increasing public sector accountability could help to improve public sector performance. Dr Kotaru Tsuru, from Japan's Cabinet Office, noted that this meant strengthening the ability of voters and taxpayers to make their "voice" heard. Public sector outputs are hard to specify, define, and measure. One of the greatest challenges is created by the difficulty faced by voters and taxpayers in monitoring public sector results, said Dr J. Edgardo Campos, one of the World Bank's leading experts on public sector governance who spoke at the seminar.
Transparency around objectives and results is essential for public sector accountability. Mr Rob Laking, a senior lecturer in public management at Victoria University in New Zealand, noted that the performance of public sector departments can only be assessed if the desired objectives are clearly specified. His views are based on more than three decades of public service, the last four years of which were spent as Chief Executive at New Zealand's Ministry of Housing.
But, choosing the correct objectives is critical for, as Stephen Bartos explained, "you only get what you measure." All contributing experts agreed that quantifiable targets were preferable, but that economies are still better to rely on qualitative assessments rather than nothing at all.
Good public sector governance can produce benefits for all economies, however economies need to ensure firstly, that they "get the basics right" and secondly, that reforms are carefully sequenced. Malaysia's Deputy Undersecretary for Macroeconomics at the Ministry of Finance Md Saad Hashim emphasized the need to tailor reforms to specific economies, which Malaysia has done through its Vision 2020 development plan.
Viet Nam has also been able to benefit from strong economic performance since the introduction of the Doi Moi (renovation) reforms that have improved Viet Nam's public sector governance. "It is fair to say that the general impression is that there have been incremental improvements in virtually all aspects of public administration and public services, and no - or very few - negative developments," Dr Nguyen Khac Hung of Viet Nam's National Academy of Policy Administration noted.
The public sector governance work is part of the APEC Economic Committee's work on structural reform. APEC Leaders have provided the Economic Committee with a mandate to coordinate APEC's work on structural reform. The structural reform agenda will include work on regulatory reform, public sector governance, competition policy, strengthening economic and legal infrastructure, and corporate governance. Work on competition policy will start in 2007.
The Economic Committee also intends to undertake further work on public sector governance. The work on public sector governance was introduced to the Economic Committee by Dr Kyung Tae Lee, the current Chair. And according to Professor Bob Buckle from New Zealand, the efforts will continue. Buckle, who is due to assume the Chair of the APEC Economic Committee in 2007, has expressed strong support for the work done by Dr Lee. "I hope that we will be able to build on the excellent work that has been led by Korea and Dr Lee," commented Professor Buckle. Further, seminars on different aspects of public sector governance are expected to be held over the coming three years.