Wherever we live in the world, so much of our daily lives is tied to our national, state and local governments. And much of our income goes to them as well, with tax taking away between 20 and 65 percent of personal income in most developed nations. It’s in our best interest of governments to operate efficiently, to spend our money wisely on effective programs that improve our lives.

Even with all the new technology being implemented, reviews of government production costs and productivity indicate that governments may be getting less efficient over time. There are some shining examples of government efficiency in the world, and massive opportunities for improvement. Governments should pursue innovative practices, scale efficient practices, measure, repeat, and share improvements to create meaningful and sustainable efficiency gains.

Balanced budgets, rational spending, and the elimination of waste and duplication are the hallmarks of government efficiency.

Statistics

Balanced budgets, rational spending, and the elimination of waste and duplication are the hallmarks of government efficiency. Governments worldwide have been recently increasing their emphasis on efficiency, but production costs in government are rising and efficiency has been declining over time. According to the Organisation for Economic Co-operation and Development (OECD), between 2000 and 2009, production costs in government rose from 20.9 percent of GDP to 23.3 percent of GDP. In the UK, a review by the national statistics agency estimates that public sector productivity has fallen by an average annual rate of 0.3 percent. Analysis by Deloitte indicates while private-sector productivity grew by 60 percent during a 47 year period, productivity in the public sector dropped by more than 10 percent.

The World Economic Forum’s annual Global Competitiveness Report, most recently issued in 2015, evaluates the efficiency of 144 of the world’s governments on measures including the wastefulness of government spending, burden of regulation and transparency of policymaking, to produce an overall global ranking. The most efficient government in the world is Qatar, but this comes at a cost of individual freedom. Rwanda dramatically decreased their wasteful government spending, leading to a strong showing in seventh position. Venezuela brings up the rear with the least efficient government in the world, with Italy and Argentina joining at the bottom.

Current Progress in Government Efficiency

Some of the elements driving government efficiency gains in recent years are the rise of smartphones, adoption of sunset clauses, and public-private partnerships. Smartphones are increasingly being adopted by people in all nations and all spheres of society, bringing with them internet access and opportunity for governments to serve and communicate with citizens. Several governments are seeing large gains in efficiency by offering healthcare, financial benefits, and other services to citizens using mobile phones. Government apps connect citizens to services and information from wherever they are at the touch of a button, a vast improvement over old ways of communicating like phone calls and letters.

Another efficiency measure that is having an impact is the adoption of “sunset clauses” that direct agencies, programs or initiatives to close down after a set period of time, once they have fulfilled their purpose. Reviews of regulations are set up as a part of new laws or programs, requiring them to be repealed if they’re no longer necessary. The United Kingdom, U.S., and Australian governments have used sunset clauses to repeal or modify an average of 30 percent of existing state regulations, reducing regulatory burdens. These governments also require that older laws or regulations that do not contain evaluation sunset clauses must be reviewed for repeal every five years. Sunset clauses are a promising development that could be applied with success in other governments to increase their efficiency.

Public-private partnerships (PPPs) have been increasingly used in the past 50 years to quickly and efficiently get things done by pairing governments and industry to solve problems.  The goal of a PPP is to bring private sector capital, efficiencies, and skill to bear on public assets or services. Companies share profits based on the performance of their projects and also take on risk and management responsibility. Governments are able to take advantage of the cost and contract flexibility of the private sector to complete projects with far greater efficiency. 

Still Much Room for Improvement

There are still many significant opportunities for efficiency gains in government, notably in purchasing, service duplication, and automation of practices. While most governments have centralized purchasing offices, many goods and services are still purchased outside of these controlled systems. One example is the finding from the UK’s Green Review that a box of paper ranged from a high of £73 to a low of £8 while printer cartridges ranged in price from £398 to £86.13. Standardized approaches and united purchasing systems across governments could reduce these coasts.

Service duplication is another area where massive cost savings could be realized by combining similar functions across government. Services like Information Technology, Human Resources, Payroll, and Accounting are handled individually by a myriad of government agencies in most countries. These services could be consolidated into a single unit that serves all agencies, eliminating redundancies and increasing information sharing between agencies. Many of these services could even be outsourced to nongovernment businesses, decreasing costs and bringing new ideas and efficiencies.

Many typical government activities involve a lot of paperwork, creating complex, slow and costly manual processes. Things like property titles and identification paperwork are still done using physical papers, requiring people to stand in line at government offices. A paperless government would eliminate many bureaucratic jobs and reduce the time required for transactions.  The government of China has begun working to streamline public services that directly affect the daily lives of people, aiming to minimize the visits ordinary citizens and business people have to make to government departments. China has adopted new practices including one-stop applications and 24-hour online government with the goal of having 90 percent of administrative processes exclusively online. This is a step in the right direction.

Towards Government that Works without Waste

Government efficiency has a significant impact on a country’s competitiveness and economic growth. Overgrown bureaucracy, burdensome paperwork, and excessive costs drag down business and impede expansion. Efficiency is producing the required outcome with the minimal (or appropriate) amount of resources, time, and cost.

Efficiency is achievable, but only if it is addressed with new technology and fresh ideas. 0Input resources like money, people, data, technology, equipment, and buildings combine to produce outcomes like new roads or workable healthcare systems. Efficiency involves ideal ratios of input to output, so it is easily measured when clear goals are set. When citizens and their leaders set aside politics and make decisions that are best for the country, without bowing to lobbyists or stubbornly sticking to old ways, every citizen benefits. Let’s work together to find new ways for governments to provide the infrastructure and services we need while eliminating waste.

“The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” -Bill Gates

Technology genius and global philanthropist Bill Gates gets it right. While technology and automation can make operations more efficient, technology alone is not the answer. Governments worldwide are still operating at a high level of inefficiency, wasting billions of dollars of taxpayer money every year.

Wherever we live in the world, so much of our daily lives is tied to our national, state and local governments. And much of our income goes to them as well, with tax taking away between 20 and 65 percent of personal income in most developed nations. It’s in our best interest of governments to operate efficiently, to spend our money wisely on effective programs that improve our lives.

Even with all the new technology being implemented, reviews of government production costs and productivity indicate that governments may be getting less efficient over time. There are some shining examples of government efficiency in the world, and massive opportunities for improvement. Governments should pursue innovative practices, scale efficient practices, measure, repeat, and share improvements to create meaningful and sustainable efficiency gains.

Balanced budgets, rational spending, and the elimination of waste and duplication are the hallmarks of government efficiency.

Statistics

Balanced budgets, rational spending, and the elimination of waste and duplication are the hallmarks of government efficiency. Governments worldwide have been recently increasing their emphasis on efficiency, but production costs in government are rising and efficiency has been declining over time. According to the Organisation for Economic Co-operation and Development (OECD), between 2000 and 2009, production costs in government rose from 20.9 percent of GDP to 23.3 percent of GDP. In the UK, a review by the national statistics agency estimates that public sector productivity has fallen by an average annual rate of 0.3 percent. Analysis by Deloitte indicates while private-sector productivity grew by 60 percent during a 47 year period, productivity in the public sector dropped by more than 10 percent.

The World Economic Forum’s annual Global Competitiveness Report, most recently issued in 2015, evaluates the efficiency of 144 of the world’s governments on measures including the wastefulness of government spending, burden of regulation and transparency of policymaking, to produce an overall global ranking. The most efficient government in the world is Qatar, but this comes at a cost of individual freedom. Rwanda dramatically decreased their wasteful government spending, leading to a strong showing in seventh position. Venezuela brings up the rear with the least efficient government in the world, with Italy and Argentina joining at the bottom.

Current Progress in Government Efficiency

Some of the elements driving government efficiency gains in recent years are the rise of smartphones, adoption of sunset clauses, and public-private partnerships. Smartphones are increasingly being adopted by people in all nations and all spheres of society, bringing with them internet access and opportunity for governments to serve and communicate with citizens. Several governments are seeing large gains in efficiency by offering healthcare, financial benefits, and other services to citizens using mobile phones. Government apps connect citizens to services and information from wherever they are at the touch of a button, a vast improvement over old ways of communicating like phone calls and letters.

Another efficiency measure that is having an impact is the adoption of “sunset clauses” that direct agencies, programs or initiatives to close down after a set period of time, once they have fulfilled their purpose. Reviews of regulations are set up as a part of new laws or programs, requiring them to be repealed if they’re no longer necessary. The United Kingdom, U.S., and Australian governments have used sunset clauses to repeal or modify an average of 30 percent of existing state regulations, reducing regulatory burdens. These governments also require that older laws or regulations that do not contain evaluation sunset clauses must be reviewed for repeal every five years. Sunset clauses are a promising development that could be applied with success in other governments to increase their efficiency.

Public-private partnerships (PPPs) have been increasingly used in the past 50 years to quickly and efficiently get things done by pairing governments and industry to solve problems.  The goal of a PPP is to bring private sector capital, efficiencies, and skill to bear on public assets or services. Companies share profits based on the performance of their projects and also take on risk and management responsibility. Governments are able to take advantage of the cost and contract flexibility of the private sector to complete projects with far greater efficiency. 

Still Much Room for Improvement

There are still many significant opportunities for efficiency gains in government, notably in purchasing, service duplication, and automation of practices. While most governments have centralized purchasing offices, many goods and services are still purchased outside of these controlled systems. One example is the finding from the UK’s Green Review that a box of paper ranged from a high of £73 to a low of £8 while printer cartridges ranged in price from £398 to £86.13. Standardized approaches and united purchasing systems across governments could reduce these coasts.

Service duplication is another area where massive cost savings could be realized by combining similar functions across government. Services like Information Technology, Human Resources, Payroll, and Accounting are handled individually by a myriad of government agencies in most countries. These services could be consolidated into a single unit that serves all agencies, eliminating redundancies and increasing information sharing between agencies. Many of these services could even be outsourced to nongovernment businesses, decreasing costs and bringing new ideas and efficiencies.

Many typical government activities involve a lot of paperwork, creating complex, slow and costly manual processes. Things like property titles and identification paperwork are still done using physical papers, requiring people to stand in line at government offices. A paperless government would eliminate many bureaucratic jobs and reduce the time required for transactions.  The government of China has begun working to streamline public services that directly affect the daily lives of people, aiming to minimize the visits ordinary citizens and business people have to make to government departments. China has adopted new practices including one-stop applications and 24-hour online government with the goal of having 90 percent of administrative processes exclusively online. This is a step in the right direction.

Towards Government that Works without Waste

Government efficiency has a significant impact on a country’s competitiveness and economic growth. Overgrown bureaucracy, burdensome paperwork, and excessive costs drag down business and impede expansion. Efficiency is producing the required outcome with the minimal (or appropriate) amount of resources, time, and cost.

Efficiency is achievable, but only if it is addressed with new technology and fresh ideas. 0Input resources like money, people, data, technology, equipment, and buildings combine to produce outcomes like new roads or workable healthcare systems. Efficiency involves ideal ratios of input to output, so it is easily measured when clear goals are set. When citizens and their leaders set aside politics and make decisions that are best for the country, without bowing to lobbyists or stubbornly sticking to old ways, every citizen benefits. Let’s work together to find new ways for governments to provide the infrastructure and services we need while eliminating waste.