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Questioning assumptions about UN management reforms & funding

17 September 2023

By Katja Hemmerich

hand placing Trust wooden block with reform and funds wooden blocks

The UN General Assembly kicks off this week, including with a High Level Dialogue on Financing for Development on 20 September 2023. One useful input to the Dialogue is the latest report on Financing the UN Development System published last week by the Dag Hammarskjold Foundation and the United Nations Multi-Partner Trust Fund (MPTF) Office. The annual publication is an excellent source of data on funding of the UN Development System followed by analytical articles, which this year are focused on innovative solutions to the current SDG and UN funding crises.

Section 2 of the report, which centers on improving the quality of UN financing, starts with a provocative article entitled: Trustworthiness, trust, together: Building the case for financing of the UN system, which asserts:

“to fulfil its potential, the UN development system must not only perform well, but must be governed effectively and transparently, and have the right resources. Underneath all of this lies one thing: trust. And yet, building trust must start with UN organisations becoming trustworthy – it is all interconnected.” Rachel Scott in Financing the UN Development System: Choices in Uncertain Times, Sept. 2023

UN organizations, like many national public sector organizations, have long been adopting management reforms borrowed from the private sector, as part of their efforts to be considered more trustworthy. Our spotlight this week examines the impact of these “New Public Management” approaches on trust in national public sector organizations, and what that means for the UN.

The impact of New Public Management reforms

New Public Management (NPM), which gained popularity in the 1990s, reflected a desire for bureaucracies to be able to demonstrate results through management strategies aimed at improving the quality of public services while simultaneously ensuring efficiency. Results-based management, adopted by the UN in 2000, which includes strategic planning that defines indicators to measure results, as well as the emphasis on performance management of entities and staff are all derived from NPM. Both at the national and international levels, an underlying objective of these reforms is to demonstrate that the bureaucracy can be trusted to provide value for money.

Studies of the effectiveness of NPM reforms at national level show mixed results, and unintended consequences. Regarding the aim of building trust, a comprehensive study by the Public Management Institute of the University of Leuven found that:

“Improving service delivery is necessary but not sufficient for trust. Good performance does not necessarily lead to more trust, but bad performance certainly will erode trust.” G. Bouckaert, “Trust and public administration”, 2012

While the UN context has not been specifically studied, there are signs that similar conclusions apply. Over the last 20 years, the UN has continuously strengthened reforms and engaged with entities like the the Multilateral Organisation Performance Assessment Network (MOPAN) set up by donors states in 2002 to assess and improve the performance of multilateral organizations. Yet, that same period has been characterized by a dramatic increase in earmarked funding, so that the UN is now the international development organization with the highest level of earmarked funding globally. The 2019 Funding Compact, which explicitly links UN commitments to increase its transparency and focus on results with member state commitments on funding has also failed to yield results. As of 2023, the UN has made progress on 57% of its commitments, while member states have only made progress on 24% of theirs (ECOSOC Presentation on the Implementation of the Funding Compact, 2023). The causal linkage between results-based management, trust and funding does not appear to be working as expected.

At the national level, research also found that reform outcomes did not always match with expectations with respect to building trust. For example, to enhance performance and accountability, NPM led to a proliferation of oversight mechanisms, including strong audit requirements for public sector organizations. While this helped increase transparency and allowed for better organizational learning, it also led to an increase in distrust within and across the public sector in many countries. The underlying premise of audit mechanisms is generally that the team or entity being audited is potentially trying to hide mistakes or misconduct. Researchers discovered that this premise permeated internal public sector cultures and often led to distrustful relationships between different elements of the bureaucracy, as well as between the bureaucracy and the executive and legislative branches.

The hyper-development of a performance-based control system puts pressure on the trust-based model for managing internal relations.” G. Bouckaert, “Trust and public administration”, 2012

Similarly, reforms that resulted in creating an internal ‘job market’ within bureaucracies through what was intended to create more transparency in promotions, as well as differentiated systems of bonuses or financial reward systems meant to inspire and reward good performances also had unexpected consequences. Because public employees are often intrinsically motivated by the desire to contribute to a greater good, these financial motivators did not see the same level of success as in the private sector. More often, these reforms led to high rates of staff turnover, a decrease in organizational loyalty, while also contributing to declining trust within the public sector.

This does not mean that the reforms were inherently flawed or wrong. But rather it highlights that the public sector - like an international organization - is a complex system of structures, networks and relationships that do not necessarily respond in practice as expected on paper. Context matters. As another comprehensive review of New Public Management reforms found:

A general conclusion is that the success or failure of NPM with respect to the quality of public services depends on the administrative, political and policy context in which they take place. This implies that reform measures should not be simply copied but instead carefully studied and adapted to local contexts. Overall, the effects of NPM on the quality, efficiency, and effectiveness of the delivery of public policies is neither in line with the expectations of the true believers in the reforms nor with those of the strong skeptics, but instead reveal a more nuanced in-between pattern determined by the contextual constraints and enabling features.” Tom Christensen & Per Loegreid, “Taking Stock: New Public Management (NPM) and post-NPM Reforms - Trends and Challenges”, 2022

One area where studies of national bureaucracies and international organizations seem to find similarly positive impacts is with partnerships. NPM at the national level increased the use of outsourcing and various forms of public-private partnerships. While results on quality of services and efficiency were not always consistent, there is evidence that partnerships with NGOs, corporations and other organizations increased the mutual understanding of public and private partners and improved trust levels. More recently, studies of how international organizations have enhanced their performance and accountability, demonstrate that operational partnerships with civil society organizations can have significant benefits, especially in improving accountability to beneficiaries. This happens in part because civil society, as third party actors, can play a role in ensuring accountability of both the international organization and their governing body members.

A recurring theme is the critical role of “bottom-up” pressures from transnational civil society (TCS) in instigating and driving reform, often in the face of entrenched institutional resistance.” Ranjit Lall, "Making Global Governance Accountable: Civil Society, States, and the Politics of Reform", 2023

Considerations for future UN management reforms & funding discussions

There will be much discussion at the General Assembly this year about the need for innovative new solutions that challenge the status quo, if the world is to address its complex current challenges. The aim of our spotlight this week is also to challenge readers to question the status quo and persistent assumptions about what 'good' management is in international organizations, and whether this is the root cause of the current funding crisis. Just as we need new evidence-based approaches to policy issues, there is a need for innovative, evidence-based approaches to managing international organizations effectively and efficiently that have a genuine impact on performance, accountability and trust. Accordingly, we leave you with the following final thought:

“One implication is that there is a need to go beyond the narrow concept of performance measured in terms of economy and efficiency and to include the broader democratic implications for power relations, trust, accountability, and legitimacy in the equation. Not only effects on main goals but also side-effects and dysfunctions have to be considered. In most democratic systems, values such as impartiality, predictability, rule of law, political loyalty, political control, participation, responsiveness, professional competence, and equity are also important elements of performance. How NPM affects features such as citizens satisfaction and trust is a very complex issue.” Tom Christensen & Per Loegreid, “Taking Stock: New Public Management (NPM) and post-NPM Reforms - Trends and Challenges”, 2022


Key Meeting of UN Governance Mechanisms this week

  • WFP's Executive Board is updated on partnerships with national governments and International Financial Institutions (IFIs) and holds an Executive Bureau meeting on 18 September 2023. On 19 September it holds an induction session for new Board members.


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