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Cutbacks put top civil servants in a difficult position

Since the credit crisis erupted, drastic cutbacks have been made in all kinds of public sector organisations, creating some very difficult choices for the top civil servants who had to implement them in their own organisation. This is the conclusion of Public Administration scholar Eduard Schmidt, whose PhD defence takes place on 30 January.

After the American financial services provider Lehman Brothers collapsed with a thundering crash in 2008, it was immediately ‘all hands on deck’ in the Netherlands as well: the resulting financial crisis hit not only the United States, but also countless companies and public sector organisations on this side of the Atlantic Ocean.

Successive governments, led by Jan Peter Balkenende and Mark Rutte, decided at once to make cuts in their own sector. Public sector organisations had to become more ‘efficient’ and ‘effective’, the terms used in policy-making language. In practice, it meant that municipal authorities, provincial governments, the central government, and even prisons and police forces, had to do the same work with less money.

Difficult but powerful leadership role

This created some very difficult choices for top civil servants, concludes Eduard Schmidt. For his dissertation, he spoke with nearly a hundred of these high-ranking public sector managers. They had to make the cuts in their own organisation, and experienced a lot of pressure from both above and below. Schmidt: ‘Because the Minister was demanding large cutbacks, while staff and trade unions wanted the number of jobs to stay the same.’

At the same time, however, his dissertation reveals that these cutbacks also give the senior managers a great deal of power, because they can actually exert a strong influence on preferred solutions. This can be seen, for instance, from interviews that Schmidt held with prison governors. While one prison tried to avoid closure by working super-efficiently, another tried to convince the Minister that the prison jobs were essential for the thinly populated region. What Schmidt is actually saying, then, is that a cutback operation demands considerable creativity of a top civil servant.

ING: ‘Public sector will show moderate growth in 2020’

The number of employees in the public sector is expected to increase by around 1.5% in 2020, which means that growth in this sector will keep up with economic growth for the first time since 2013, according to the ING’s latest prediction. The growth might have been higher, but it is held back by workforce shortages and falling numbers of school students.

Yet his study also found that cutbacks can sometimes restrict the opportunities for senior managers to display leadership. When the most politically sensitive cutbacks have to be made, it might only be the people at the very highest level of a Ministry who are involved. Other senior managers can then merely add a few different emphases within the frameworks that have already been established.

Making the consequences clear

What can we learn from this for cutbacks in the future? Schmidt: ‘That public sector managers not only need to be honest about what the cutbacks will mean for their staff, but also need to make clear to the Minister what the consequences of those cutbacks will be. If it takes longer to answer Parliamentary questions, does the situation in prisons become more dangerous? Top civil servants have, as it were, an obligation to provide information to the Minister.’

Schmidt also points out that there is a more fundamental problem underlying the cutbacks. Although many politicians and citizens think that public sector organisations do indeed fulfil an important role, they are not really willing to pay for it. Making cuts in public sector funding is therefore one of the first reflexes in a crisis, and sometimes these cuts can be very rigorous. Schmidt: ‘For instance, several prison governors told me that the staffing levels were now so low that it was almost impossible for them to guarantee the safety of their staff. And other organisations too, like the Dutch Food and Consumer Product Safety Authority, have had to make too many cuts in recent years, although the amount of work has remained the same. If you keep on cutting back too often, you’re going to find that in the end there’s not much left.’

Text: Merijn van Nuland
Photo: Arash Nikkhah

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