E-Government Policies and Decentralization in New Zealand

Defragmenting e-Government in New Zealand

“Decentralization had brought benefits such as innovation, flexibility, and speed of response to New Zealand public services. Now that a more unified and collaborative approach was sought, could compulsion be introduced without undermining these valued advantages?” (Norman, 2007)

The above mentioned words comprise the kernel of the problem presented in this case. This is the basic question it tries to answer. Since the beginning of the 1980’s the government of New Zealand has been engaged in a decentralizing reformation of the services it offered to the public and the various institutions comprising it on a local or central level. For more than 15 years decentralization has been the core policy of various governments especially labor party governments. But the needs for innovation and improvements in public sector and governance performance have led to the need for implementation of e-government technology. The problem that arises is that the implementation of this technology, along with its needed policies, contradicts in many ways the existing decentralization reform policies. So then, how to achieve a structure adjustment; formulate a set of policies that do preserve the core of reforms, decentralization and e-government, in order to get the best from both of them? That is the core of the research paper discussed. The central and local government branches of New Zealand are the key players on this regard. The ministry of State Services is the representative key player for the central government along with the various central government institutions created in relation to these policies: the State Services Commission and the newly formed e-Government unit. Other key players are all those public sector decentralized institutions that deal directly with citizens. In a certain way the entire public sector is a player of these reforms. Certain privately owned enterprises dealing with public service offerings are also important players. Due to the decentralization reforming policies of more than two decades ago they have been part of the public service offerings and now the new e-government policies impact directly on their work.

Key political issues and management problems of the case and their impact on organizational performance

As minister Annette King pointed out, there was a need for a ‘transformational goal’ in the system in order to make government ‘work for the people’ (Norman, 2007, p. 4). But this need for a centralized system in order to have the maximum performance possible out of the e-government technology implementation has become a key political issue in New Zealand. This is a two parts issue. First, the government decided to implement the e-government reform policy without major changes of the existing decentralization policies. This was the first stage of implementation of e-government in New Zealand. Unfortunately, what this situation produced was less accountability and a decrease in performance from the decentralized local institutions which offered the majority of public services related to society. The political aspiration behind the e-government policies was to “capitalize the power of the Internet to transform the way we conduct the business of government” (State’s Minister Annette King speech; cited in Norman, 2007). With the first attempt to apply e-government the power and competencies of chief executive officers and chief information officers of decentralized institutions and agencies was increased, giving them a further expanded autonomy of action and decision making. They had not only the power to act a certain way but also to decide regarding the policies and implement their own vision if ICT (information and communication technology). The problem was that accountability and responsibility was not stepped up the same way. In comparison, a head of a department, or division, in a private company (the equivalent of governmental ministries or agencies) was expected to deliver certain measurable and relevant local results by using a common standard or system decided by the management board of the company. If they were not to deliver the expected results, than they could expect sanctions. This was not the case for chief executive officers for the public sector governmental agencies. They were subject to very weak sanctions. Even the annual performance review made on these agencies was to bureaucratic and focused more on details rather than on performance. This way the political aim of making government easier to citizens vanishes. Also, the chief executives are not challenged in their work neither are put on pressure to achieve results for the good of the public. They van even opt out of the system obligations and no significant pressure or sanction will apply to them. Another problem of management is that the SSC people are not qualified enough on this level of management. Kerry McDonald’s was chair of the State Sector Standard Board, a government advisor regarding e-governmental policies and now a private sector director. It is very meaningful to have him make an evaluation of the process. Regarding chief executives and chief information officers he states that:

“They want to develop their own choice of hardware and software; they don’t want their professional horizons frustrated by anything external and find a myriad of reasons why they couldn’t possibly collaborate with or be part of another system. Because CE’s are generally non technical, few test and counter these arguments effectively and so CIO’s tend to get their way.” (Cited in Norman, 2007)

But what is more important is the fact that the government itself is making a big mistake in not assigning the adequate professionals to review the job of chief executives and chief information officers at the SSC.

“The whole essence of performance management is having someone experienced and capable, at least, at the same level of management and preferably one above, reviewing performance with the understanding of the complexity and challenges of the role and able to realistically criticize, guide, encourage and praise”. (Cited in Norman, 2007)

The above mentioned are the management problems arising from the implementation of the e-government policies. But the kernel of performance problem for the chief executives and chief information officers is the ‘culture’ formed during these two decades of decentralization. An organizational and work culture is the most difficult thing to change when you employ a reformation process (Gomez-Mejia et al., 2008).This is the most important aspect of the political problem. It is that due to the reformation the once centralized public sector was ‘dismantled’ into individual institutions, departments, ministries and agencies with no direct responsibility connection to a central unit.

There were cases in which these institutions or agencies were even further divided between policy and operational functions. And now, we see that the formation of a new institution, the e-Governmental Unit, was necessary to coordinate and even control the ongoing of the reform.


Gomez-Mejia, P. et al. (2008) Management: People, organization, performance, 3rd edition. New York: McGraw Hill.

Norman, R. (2007) “Defragmenting e-Government in New Zealand”. Case study at the Kennedy School of Government, Harvard University. Web.