Crisis-driven policy on the rise as state shrinks

By David Donaldson

October 26, 2016

It can be easy for governments to fall into the trap of being driven by current events, responding to incident after incident and never quite getting around to the work that doesn’t make it onto the front page.

Crisis-based policymaking is becoming more common and it leads to bad decisions, says British innovation expert Indy Johar.

“You get a crisis — good god panic — you get a judge on board, you’ve got to sort this out, got to allocate blame, then we’ve got to find a magic solution somewhere,” Johar, a senior innovation associate with the Young Foundation and visiting professor at the University of Sheffield, told last week’s annual Institute of Public Administration Australia national conference in Adelaide.

“Whenever we have crisis-based reform, actually you’re not really looking for the solution, you’re looking to allocate blame first. You really don’t have the time and effort to deal with the problem.

“And also you get the wrong people in charge. Let’s be honest … lawyers are great at analysing where the problem is, they’re not really effective at designing solutions. So you put together a commission, you figure out what the problem is, but you have no idea what the solution really is. Because you haven’t done the ethnographic work, nor do you have the political landscape to have the deep, complex conversations.”

Diminished state undermining strategic capability

He believes the Anglo-Saxon mantra of “let’s burn some regulation and life will just get better” is partially responsible. Many parts of society are convinced government is a bad bureaucracy it just has to deal with, and preferably shrink. But the resulting lack of investment means we’re underprepared for strategic change.

“As a result largely of how reductive our discourse around statehood has become, the state is increasingly focused on crisis-based reform. You get a crisis, that is the only political window you have to do something.

“Everyone jokes about ‘never waste a crisis’, but that’s really poor. Steve Jobs didn’t say, ‘never waste a crisis, let’s make the iPhone’. The NHS wasn’t born by saying ‘never waste a crisis, we’ve had a world war’. It was genuinely something progressive. And I think we need to get to the front foot on these conversations.”

In contrast to the dominant idea that government is a nuisance that impedes the private sector, it’s a key pillar of the economy, he argues. 80% of the intellectual property in an iPhone was funded by the United States, for example.

“The state is a fundamental infrastructure of growth and development. It’s not an overhead to be borne by the private sector. It’s actually the source of structural innovation. And I think one of the things we have is a misunderstanding of the state. We’ve started to be reductive about its possibilities.”

Silos impeding outcomes

If governments are to tackle strategic problems effectively, they’ll also need to get better at collaborating.

Johar gave the example of educational standards in the UK. Silos mean the Education Department knows all about schools, but doesn’t have the knowledge base or influence over other parts of the education constellation.

The left and right hands aren’t coordinating. Though it’s known that libraries help boost educational outcomes, they come under the arts budget and have been cut at the same time that governments have been trying to improve education.

“If there’s 40 different actors driving educational attainment, how do you write a strategy?” he pondered. “Why employ McKinsey to write you a strategy for a single department when you need to talk about 40 different organisations with a shared mission and shared accountability? I think this is a fundamentally different behaviour and new modality.”

Flourishing citizens

Policymakers need to renovate how they think about citizens’ life outcomes if governments are to deliver really effective services, he thinks.

The default goal should be to see everyone “flourishing”, Johar argues, and every example of someone not meeting their full potential should be seen as a genuine loss to society. This approach would have widespread implications to how governments planned, accounted and invested in services.

“The loss is not if people are unemployed — the loss is if people have not flourished, that is the loss. Imagine if we were calculating that way,” he said.

Social enterprise not a panacaea

Discussion of social enterprise often fails to acknowledge its true scale, making it seem like a larger phenomenon than it really is, Johar added.

The largest social investment fund in the world is the UK’s Big Society Capital, which is worth around $400 million. The UK welfare budget, by contrast, is close to $400 billion — or 100 times the size.

Scaling up is a key challenge if governments want social enterprise to play a significant role.

“The idea that somehow the private sector by building an app will be able to deal with that scale of challenge, looking at reoffending rates and so on — these are massive structural challenges,” he said. “My problem is that we’re looking to the wrong scale of solutions to imagine that they will solve things which are structural flows of value.”

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