Opinion: Perhaps some of us had hoped Christopher Luxon’s negotiating skills would have secured a coalition by now. But his approach of building genuine relationships with party leaders and developing trust with his team before addressing other priorities is far from wrong.
Whether this will be sufficient to form a ‘strong and stable’ government remains to be seen, but it does demonstrate that the incoming Prime Minister is unafraid of trying unconventional approaches. This skill will be much needed for the more significant challenges he will face.
Luxon comes to power with the reputation of being a competent corporate leader, and his fast political ascension indicates he is capable of adapting to different complex environments and succeeding.
Transitioning from the private sector into politics, becoming party leader, unifying the party and convincing the electorate of his worthiness for the top job – all in record time and with limited political experience – speaks clearly about his capabilities.
Though this enhances his credibility, it doesn’t diminish the complexity of the challenges.
With advanced coalition talks, Luxon and his team will soon be busy organising the new government and striving to achieve early wins with their 100-day action plan. And rightly so, but it’s essential to keep in mind that there will always be short-term pressing matters on the agenda.
Inflation won’t decrease significantly overnight, implying that internal turmoil from the cost-of-living crisis is likely to persist for some time for the new government. Climate change is all around us and the international picture is volatile, with the world still grappling with the aftermath of Covid-19, two large-scale conflicts with the potential for escalation, and geopolitical tension in the Asia Pacific region.
Amid these challenges, the new government must develop clear, realistic targets and a robust strategy to guide the underlying work required to achieve them. It must maintain a focus on outcomes but allow room for learning and the adjustments that will inevitably be required.
The former government focused excessively on big institutional reforms and didn’t make it very clear how exactly those ambitious programmes would address the underlying causes of the problems and produce results. Take health, for example. It is not clear how centralisation would help alleviate our main problem there – a lack of capacity.
Besides questions about policy design, the lack of clear performance metrics and communication about these metrics left the population wondering if the effort was worthwhile. When it comes to effective policy making, relying on ideological convictions only is just not good enough. One can have the best of intentions, but if programme evaluation is not well thought out before the implementation, a precious opportunity to learn and correct course along the way is missed.
Luxon and his team will need time to understand the systemic problems causing government inefficiencies. In addition, they will have to establish performance contracts with delivery and compliance agencies and allow time for these organisations to adjust. Unless there is excess capacity, job cuts, if any, should come as a result of efficiency gains, or they will risk making matters worse.
The new government will have to find ways to work collaboratively with civil servants and bridge the gap between the political and institutional environments. In this context, excessive centralisation would be a mistake.
To achieve high-performance, the new government will need to rely on the power of a motivated collective that goes far beyond their political inner circle. They will need to create incentive structures that establish consequences for performance and empower government agencies to be creative and seek solutions to improve their operations.
In the Government of the State of São Paulo, where I served for many years as a senior advisor, the effective implementation of an electronic reverse auction system for the procurement of common goods resulted in significant efficiency gains. The speed of procuring dropped from months to days; direct costs reduced by a quarter on average in the first year; indirect costs plummeted by 36 percent; and all aspects of the procurement process – including bids, who sold and at what price – became available online to all competitors and citizens in real-time.
The project’s success was partly because of the strong political backing from the state governor, who supported the treasury secretariat’s modernising agenda. Once the project matured, legislation was passed, making it mandatory for the procurement of common goods and services in every entity of the state government.
New Zealand was once at the forefront of innovative thinking in public policy. The reforms in the mid-80s and early 90s not only exposed state monopolies to competition, extracting performance from organisations on behalf of customers, but also fundamentally altered the way government conducts its business. These reforms kept policymaking in the hands of politicians while granting autonomy to managers in exchange for efficiency. It’s time we embrace innovation in public management with pragmatism again.
Take water and sewage, for example, where the latest initiative from the central government to take autonomy out of local government was coupled with controversy. Can we come up with a new approach to address legacy challenges in water infrastructure development, maintenance, and service delivery, while ensuring a proper regulatory framework to safeguard public interest?
In addition, to achieve real outcomes, Luxon’s team will have to find ways to genuinely engage with society and put customers at the centre of their policymaking. This is about going beyond efficiency to ensure policy effectiveness – the extent to which governmental efforts will improve the quality of services to the population.
Think about, for example, reducing waiting times in hospital queues, improving the academic outcomes of our lower decile schools, or even simple things like reducing the time it takes to renew a driver licence or a passport.
Transparency can be a great ally. In São Paulo, easy access to information and streamlined processes promoted competition in public procurement, yielding significant results.
In line with practices in any great company, regularly conduct customer service surveys to use customer insights for process improvement. Engage with the population and leverage consultations as a genuine means to gather input from stakeholders and enhance your proposals. Treating them as mere tick-box exercises is a waste of time and money.
Additionally, create simple, easy-to-understand Key Performance Indicators and educate the public about them. Though this approach will subject officials to scrutiny, it will significantly boost team performance and morale as they witness the positive impact of their actions on people’s lives.
Unlike managing a private corporation, an elected government must navigate challenges in politics, government machinery, and society, presenting numerous potential pitfalls. Therefore, in developing an effective strategy beyond the first 100 days, our new government should avoid assuming it has all the answers.
Instead, set higher level goals right and allow some room for experimentation and learning, so that comparative advantages can emerge and best practices spillover across departments.
This will also pay significant dividends to help the elected government leverage the opportunities they will encounter and correct course to overcome resistance to change when needed.
An approach like this may even help line-managers eventually see change as something desirable and in their own interest.
If that happens, the new government will have a much higher chance of succeeding.