New Public Management's Current Issues and Future Prospects

Abstract

In this paper we describe the main characteristics of NPM and illustrate the current state of affairs in three main areas: (a) the effectiveness of NPM reforms, (b) NPM's impact on planning and control in government entities, and (c) the implementation and use of accrual accounting methods in government. We use the responses of 105 (mostly Dutch) practitioners in government and non‐profit organizations. Most respondents recognize performance improvements, but only a minority attribute these improvements directly to NPM reforms. Improved planning and control systems are seen to have only a limited impact on the work of professionals, while accrual accounting is considered to have only limited potential to support political decision making.

Municipalities’ Choices of Service Delivery Modes: The Influence of Service, Political, Governance, and Financial Characteristics

“…Control is exercised by focusing on the inputs and the intra-organizational processes. In the (late) 1980s, a shift was made (in the Netherlands, but also elsewhere) from PPA to New Public Management (NPM), but the specific elements of NPM varied among (government levels of) countries (Groot and Budding 2008). NPM proposes to put service delivery more at a distance by contracting out activities.…”

The effect of IPSAS on reforming governmental financial reporting: an international comparison

“…Several governments have been adopting and implementing accrual accounting systems. Different authors (Pina and Torres, 2003;Groot and Budding, 2008) emphasize the advantages of introducing accrual accounting in a governmental context. Accrual accounting as defined and introduced by NPM reforms, provides more and accurate information about government solvency, patrimonial goods and the costs of public services (Pina and Torres, 2003: 335).…”

Governmental budgetary reporting systems in the European Union: is the accounting basis relevant for the deficit reliability?

“…Groot and Budding (2008) highlight that one of the most relevant characteristics of NPM is replacing traditional cash-based with accrual-based accounting for the purposes of financial reporting in order to achieve greater transparency and accountability. Accrual accounting has been introduced to generally improve the financial information system of public sector entities (Christiaens et al, 2010).…”

“…However, accrual accounting is used more for performance and control of governmental agencies and less for budgetary decision and policy-making (Groot and Budding, 2008;Paulsson, 2006).…”