New Public Sector Management and Administrative Reform in Austria

Efforts to consolidate the budget and the need to create a modern structure have already led to far-reaching activities towards reforming the public sector in the EU countries. Based on the principles of New Public Sector Management, these measures involve identifying the responsibilities of the state, implementing them at the organisational level and designing the requisite framework. Considering that public spending makes up more than 50 percent of GDP and in view of the competitive pressure exerted on Austria as a business location, efforts have been made in Austria as well to improve the efficiency and effectiveness of its government bodies. At federal level, two reforms have been carried through in the past decade: an administrative project and a programme for innovation. The first project (1989–1994) had set itself the goal of boosting productivity by 20 percent within four years and providing for overall streamlining of the authorities. The large-scale project was successful in that some divestments were made and – primarily – that taboo subjects (such as temporary management functions, introduction of cost accounting) were discussed in public. In addition, it highlighted deficits in the management which made the call for economic management concepts more convincing. The programme for innovation (1998–99) aims to convert the state into a service state and to raise productivity by 2 to 3 percent per year. Its success is mostly project-related, such as the establishment of one-stop shops, a trial involving more flexibility in the budget law, virtual help and the development of a performance report by the Austrian Federal administration. Both projects focus on internal reforms. An overall concept within the meaning of New Public Sector Management is missing, as are comprehensive efforts to reassess the state's responsibilities and restructure the external framework for administration. This limits the success of the project since conditions affecting the reforms are not changed throughout. For a reform to be successful, it is necessary to create practical tangible or intangible incentives at both political and level. Reform of the law governing civil service employment is indispensible.