Undertaking Reform in France
In France, as in many European countries, controlling public-sector finances has become an imperative. The country’s government debt ratio has reached 68 percent of GDP, and the trend in public spending is clearly upward.
October 2015 | by Robert Harris
Nicolas Sarkozy, who made this a key issue in his presidential campaign, offered a symbolic commitment not to replace one out of two retiring civil servants. After taking office, in 2007, President Sarkozy worked with Prime Minister François Fillon to develop and implement a global reform program, la Révision générale des politiques publiques (RGPP), to achieve structural reductions in public expenditures. The program has other goals too: modernizing the state’s organization, improving services for citizens and companies, ensuring that civil servants receive greater recognition for their work, and promoting a culture of results. Overall, the objective, as the prime minister has said, is to “do better with less.”
The program’s expected €7.7 billion impact is to be captured by 2012—a target set before the world financial crisis began, so it doesn’t address the further increase in public debt required by government rescue plans. Nonetheless, the program, comprising 370 initiatives selected after a spending review in each government department identified money-saving and efficiency opportunities, is an example of what we mean by a whole-government transformation. All of the initiatives were launched simultaneously. A wide-ranging government reorganization is implied by some of them, such as the creation of cross-departmental shared services, including the management of real estate, human resources, and pensions. Other initiatives (for instance, the implementation of a new, performance-based university funding system) have critical goals and still others (such as the acceleration of the naturalization process) symbolic ones. The reform effort pulls varied improvement levers, including lean-operations techniques, information technology, and performance management.
Each ministry had to buy into the program—a key step early on. Empowered ministers, put in charge of developing action plans, set their own efficiency and service-level targets, and every minister’s budget incorporated financial and productivity gains. To ensure strong, consistent, and high-visibility governance, a supervisory committee is led by the budget minister and the chiefs of staff of the president and prime minister. The committee has a formal progress meeting with each minister every three months. To encourage transparency, the government put measurement at the heart of its approach. The budget minister reports on each department’s progress every quarter. (Citizens can stay up-to-date by visiting rgpp.modernisation.gouv.fr.) This kind of communication raises the odds that all ministries will focus on the reforms until they are implemented.
The French transformation journey has just begun and it will probably take until 2012 to capture the full benefit. Several big challenges remain. For one, the reforms focus on administrative structures and processes and have yet to achieve visible improvements for citizens and civil servants. Demonstrating the reality of change—even on a small scale, such as reducing wait times for emergency treatment in hospitals—is critical to the success of reform programs.
Second, human-resources practices should get particular attention. Civil servants must be helped to acquire new operational skills that will allow them to implement the reform program successfully. Departments must make sure they have the right people in the right positions. That means more coordination between ministries and greater flexibility to move people from one position to another, depending on needs.
Third, the first round of reforms successfully addressed the ministries’ running costs, but the effort must be expanded to cover all public spending. The government has already decided to broaden the modernization effort to 650 other state agencies. Covering the entire public-sector spending base is probably a five- to ten-year challenge.