The future-proof design of the public sector requires dealing with the new public budgeting and accounting system as the basis for economic and generation-appropriate administrative action. This includes the following focal points in particular:
Reform of the public accounting system
With the modernization of the accounting system, the public units in the German-speaking countries are facing the biggest administrative reform since the reform to municipal and cameral self-administration by Stein and Hardenberg at the beginning of the 19th century. The reform concepts being pursued in the German and Swiss regional authorities of the states (cantons) and municipalities (as well as at the Austrian federal level) are oriented toward commercial accounting or the accounting style of double-entry bookkeeping (accrual accounting). They thus form the basic prerequisite for economic administrative action in the sense of (New) Public Management. In a departure from the traditional accounting style, which only takes account of actual payments, in favor of a new information and control system, the actual financial situation and the actual consumption of resources by a local authority are recorded for the first time in terms of transparency and intergenerational fairness. However, this development has so far often remained comparatively inefficient due to the freedom of design within the framework of federalism with regard to the need for a minimum level of standardization and international harmonization. The practical reform process therefore requires accompanying research in order to counteract the heterogeneous development with regard to accounting or valuation, balancing and systematization of public accounting. In addition, international approaches, especially at the European level, must be taken into account. Above all, IPSAS (International Public Sector Accounting Standards) and EPSAS (European Public Sector Accounting Standards) should be mentioned here. On an empirical basis, the development lines or deficits of the reform are to be compared and concrete recommendations for practical action derived.
Public Sector Accounting Reform
Current administrative reform focuses primarily on public accounting and thus on documenting the financial results of realized processes. However, the decisive element in the public sector is the planning level and thus the budget. Therefore, a major focus of public management research is on a reformed public budgeting system (accrual budgeting), which is implemented on the basis of double-entry accounting (especially cost and activity accounting) (e.g. in the sense of integrated composite accounting). This means, in particular, that the income budget (and no longer the purely fiscal financial budget) becomes the central planning parameter. Here, a considerable research deficit can be identified, especially in the relationship between political and administrative rationality in the context of budget planning. At the state and local levels, it is important to further develop resource management procedures and to evaluate whether and how the new (double-entry) information is used and accepted, e.g., in the context of budget planning.
Risk and debt management
The question of creating and regaining trust and credibility in politics, which is directly related to the issue of public information and control systems, is complemented by questions about systematic risk or debt management for public entities. The structural debt situation of all public budgets puts the fundamental freedom of action and decision-making of state and municipal units at great risk. For example, monetary debts in Germany alone currently stand at around 2 trillion euros, representing an annual interest burden of around 75 billion euros. The challenge here is, on the one hand, to realistically depict the so-called implicit debts by means of a double-entry accounting system that takes into account the consumption of material values and the inclusion of future obligations such as pension provisions, and to include them in the calculation of actions. On the other hand, it is important to anticipate positive tax revenues in the sense of a financial opportunity by means of a realistic risk assessment and in order to improve financial policy planning.
Performance measurement and performance management
The reform of public budgeting has led to a particular need to focus research on the level of performance measurement and performance management at the same time. The central argument is the requirement, which has existed throughout the entire reform discussion, for an efficient and effective link between the resources used and the performance or impact achieved by administrative action. In addition to the derivation of structures and indicators for the transparent mapping of output and outcome, the use of this information for the management of public units, especially in the budgeting and budget formation process, is in the foreground. Approaches to investigate their effectiveness can be found in the impact-oriented concepts of administrative management, for example in Switzerland (WoV, FLAG) and especially in the Anglo-American-speaking region (modifications of the PBBS, GPRA, MfO, etc. ).
In the future, new cooperation and organizational models as well as new decision-making procedures will be required for the (cooperative) provision of public value creation. These include in particular:
Private Public Partnership
Private Public Partnerships (PPP) aim to jointly implement public investment projects through long-term cooperation between the public sector and the private sector, thus making them more efficient than was previously the case with purely public financing.
A distinction must be made between two basic categories with different problem areas and cooperation requirements: The contract PPP and the organizational PPP. Contract PPPs are characterized by contractual solutions in which the PPP serves purely as a procurement variant and form of financing. Examples of this form are the operator model, leasing model, concession model, forfaiting, sale and lease back or cross border leasing. The organization PPP is however more specialized: This is an institutional PPP, which is a specific form of organisation and financing for the performance of public functions. Examples of this PPP are mixed-economy limited liability companies and joint stock companies as well as financial participation. There is a need for research in this area, particularly on questions of modeling incentive and control systems as well as on questions of the design and possible applications of PPPs in specific public task areas.
Public Public Partnership
Due to decreasing room for manoeuvre and increasing indebtedness of public entities, they are also increasingly forced to utilize economies of scale and scope and to merge into larger entities. An example of this is the shared service centers that have been present at the administrative level for some time, as part of a consolidation and centralization of service processes between several administrative units. In addition to cooperation and collaboration on individual administrative tasks (e. g. data centers), the mergers of public authorities (public mergers) as a whole are increasingly being discussed. Examples of urban regions and mergers of administrative districts or strategic mergers, e.g., into metropolitan regions, are considered core elements of current administrative and territorial reforms.
The systematic involvement of citizens in the public decision-making and value creation process is also on the international research agenda. New private-sector strategies in innovation management are attaching increasing importance to external knowledge in product and service development and are systematically integrating external actors into the corporate innovation process (open innovation). These new ways of cooperating with contributors beyond the company’s boundaries raise the question of whether these mechanisms can also be applied to the further development of the public sector (Open Innovation for Government/Gov 2. 0). Examples from the United States show in initial approaches how joint public value creation with citizens is possible using appropriate Internet technologies (citizen integration, citizensourcing) and thus increase the quality of administrative action. In addition, due to the originally democratic setting of participation and transparency, the public sector in particular offers itself the opportunity to integrate citizens more strongly into political decision-making processes via Internet platforms and to depict classic political processes in the digital space as well.
Analogous to the private sector, the essential reform driver and path to greater efficiency of administrative processes in the public sector is also the technological further development of existing IT systems. In the context of technology management or a purely technological view of administrative modernization, the conception and implementation of new information systems for resource and administrative control must be included in public management research. In this sense, eGovernment approaches are to be considered and further developed as agency-wide and cross-agency communication and information processes. This includes, in particular, the interfaces between the state and citizens (eDemocracy), between administration and business, and between administrations themselves (eAdministration).
Procurement spending by the federal, state and local governments amounted to more than €280 billion in 2009. This corresponds to a share of around 10% of the gross domestic product. In studies of public procurement in Germany, experts estimate that up to 30 billion euros could be saved. Furthermore, there are indications that, compared to the private sector, the prices paid by public purchasers are on average 5% to 15% too high. Administrative reforms have brought about instrumental innovations in public procurement, such as electronic award processes, but hardly any strategic thinking, bundling in procurement and sustainable savings effects. Precisely because the realization is gradually gaining ground that public purchasers must not only be provided with increasingly better technical instruments, but must also further develop their working methods, there is an immediate need for action: The creation of strategic purchasing organizations at the governmental and and supra-governmental level is a contribution to systematically conserving the scarce budget resources in all places. In this context, however, the question must be answered as to what restrictions arise from public procurement law for such optimization.