19 September 2003
The Audit Commission has launched a broadside against the government's profusion of nationally set targets for local services, warning that they can distort priorities and lead to 'perverse consequences'.
The public spending watchdog warns that many targets set in Whitehall are at best ineffective and at worst encourage the practice of 'gaming', where staff focus on meeting targets to the detriment of other parts of the service.
To avoid this problem, 'clusters' of performance indicators should be used to quantify service users' experiences, such as measuring hospital readmissions to ensure that anti bed-blocking measures are not having unintended consequences.
While some national benchmarks can be helpful, the commission argues, many should be replaced by targets set locally to reflect priorities on the ground.
In some instances they should be abandoned altogether and replaced with an objective to work towards.
Audit Commission policy adviser Paul Najsarek, who wrote the report, said complex issues, such as regeneration, were best tackled at a local level. He told Public Finance that the commission was not calling for an end to performance management, but was instead advocating a more flexible approach.
'It's important to distinguish between targets and performance indicators. We are not advocating a position where people set their own targets and no one ever looks at them. Indicators are useful in providing information so authorities can be compared,' he said. 'But targets need to be used more intelligently.'
Commission chair James Strachan endorsed this position. 'Targets are invaluable and here to stay – but as tools for improvement. They should never be ends in themselves.'
The commission's intervention in the debate coincided with a report from the Better Regulation Task Force, the committee set up by ministers to slash the bureaucracy and red tape generated by government departments.
It urges ministries to give greater consideration to ways of implementing policies besides what it calls 'classic regulation'. Focusing on the public sector, it highlights the use of targets and says the effects of perverse consequences should be properly considered at the policy planning stage.
Penelope Rowlett, chair of the BRTF sub-committee that produced the report, told PF that there were still 'huge problems' with the use of targets.
'Sometimes the incentives associated with the targets seem to be too great, and people end up distorting the fundamental policy in order to meet them.'
Rowlett added that 'a lot more research' needed to be done to establish how they could be used appropriately.
PFsep2003
