Demediuk, P. and Solli, R. 2007. From Atomic Bomb to Aromatherapy: Misplaced Metaphors for Local
Government Reforms? BE&SI Anthology of Business. N2
From Atomic Bomb to Aromatherapy: Misplaced Metaphors for Local Government Reforms?
Peter Demediuk
School of Accounting and Finance,
Victoria University.
PO Box 14428,
Melbourne Mail Centre Melbourne, Australia 8001.
Phone: +61 438 075507
peter.demediuk@vu.edu.au
Rolf Solli
Goteborg Research Institute,
Goteborg University.
Box 600. SE 405 30 Gotrborg, Sweden
Phone: +46 31-786 1590
rolf.solli@gri.gu.se
Abstract
Outlandish or blunt metaphors are useful vehicles for imagining the unimaginable, speaking the unspeakable. The metaphors in
our paper title come from an interviewee – one of many deeply affected and troubled by relentless imposition of reform
agendas on local government in the State of Victoria, Australia. This paper reports on our findings about the Best Value reform
at ten of the seventy-nine local governments in Victoria. We argue that Best Value and its attendant phenomenon of
community engagement appear to have had a dramatic and positive impact on the very role of local government, extending it
from a service purchasing and service delivery function to a facilitation and advocacy role for better community conditions.
The first phase of Best Value is over, and the currency of the term is fading despite it being an ongoing legislated requirement.
But whatever individual councils choose to call Best Value mark 2, it needs to promote a more holistic approach with more
collaboration between a local government’s service groups and amongst citizens, interest groups, other governments and
stakeholder entities. Maybe if that occurs, aromatherapy is an apt metaphor for a reform that improves wellbeing, rather than a
pejorative description.
Introduction
Public sector reforms - big and small - have names, and by the way, so have hurricanes of some magnitude. Reforms can be
called: city district reform; municipal committee reform; management by objectives; balanced score card, and so on and so
forth. Even when reforms have the same names, researchers have proved again and again that they take different shapes in
practice, regardless of which organizations are compared. Translation – of abstract ideas to concrete practices, of words to
actions, from one place to another – inevitably leads to difference in relation to the original. The ‘Best Value’ reform agenda
for local government activity is itself both a label (a ‘reform mark’) and perhaps without many stakeholders realizing it, a
metaphor for what is desired but not necessarily for what is achieved (Solli, Demediuk & Sims 2005). The orientation of the
‘Best Value’ reform-mark calls for fast, responsive, cost-effective and rational decision-making framed by measurable
assessments, but incorporating community expectations and values (LgPro 2006).
In Imaginization, Morgan (1997b) recognises that people within organisations need to create their own metaphors and become
accomplished in the art of using them so as to find appropriate ways of seeing, understanding, and shaping the situations with
which they have to deal. Metaphors are an indispensable skill rather than some 'nice to have' tool. And whether you realise it or
not, you, and everyone around you, are using metaphors all the time, and are taking decisions based on those metaphors
(Lawley 2001). In all aspects of life we define our reality in terms of metaphors and then proceed to act on the basis of the
metaphors. We draw inferences, set goals, make commitments, and execute plans, all on the basis of how we in part structure
our experience, consciously and unconsciously, by means of metaphor (Lakoff & Johnson 1980). Morgan (1997a, p. 348)
notes that "All theories of organisation and management are based on implicit images or metaphors that persuade us to see,
understand, and imagine situations in partial ways. Metaphors create insight. But they also distort. They have strengths. But
they also have limitations. In creating ways of seeing, they create ways of not seeing. Hence there can be no single theory or
metaphor that gives an all-purpose point of view". So whilst the officials who instigated the Best Value reform in the UK and
Australia chose a metaphoric name, stakeholders have sometimes chosen quite different metaphors to describe what the
phenomena means to them. Metaphors for a metaphor, if you will.
When a new government in the State of Victoria introduced the ‘Best Value Victoria’ reform, it was a huge change from the
previous reform of ‘CCT’ (Compulsory Competitive Tendering) that had seen local government as a purchaser, rather than a
provider, of services which it deemed the community required. Our interviews at Victorian local governments to establish the
nature, impact and future of the Best Value reforms drew out numerous alternate metaphors to describe what was happening.
None were more striking than the following description by a senior manager who had lived through the CCT and Best Value
reforms:
In about five years Local Government reforms have gone from Hiroshima to Aromatherapy. CCT left councils and their
communities smashed and melted. With Best Value it’s as though Local Governments are sitting around … and thinking
how wonderful the world is, while getting their feet bathed.
In this paper we examine the Best Value in Victoria reform: what came before; what came during the initial five year span of
the legislation; and what might come after. Along the way we consider how appropriate the blunt metaphors of Atomic Bomb
and aromatherapy are for these reforms. Indeed, is aromatherapy more apt than the official ‘reform-mark’ of Best Value? First
we set the context for Best Value by briefly describing the CCT that came before it. Secondly we outline the key premises and
features of the Best Value reform, and a theoretical model that illustrates its basic elements. Thirdly, we describe the
methodology of our research. Finally we present the findings and conclusions of our study into how managers and politicians
at the ‘coal-face’ have seen Best Value.
Compulsory Competitive Tendering and Associated Reforms
In 1992, the Kennett Liberal Government in Victoria was looking at ways of increasing control over local government. It is
important to note here that in Australia, unlike countries like the UK, Sweden and the US, local governments are not enshrined
by the federal constitution but are creations of Acts of State parliaments.
The number of councils was cut by the State Government from 210 to 78, and Premier Jeffrey Kennet dismissed all of the
elected representatives and appointed official Administrators. A new word came into the parlance; the Premier had “Jeff'd" all
the mayors and politicians and most of the councils across Victoria when municipalities were amalgamated. So to be "Jeff'd"
came to describe what happened to people, institutions and processes in this and other Kennet government reforms. To further
increase control over councils, Compulsory Competitive Tendering (CCT) was borrowed by the Kennett Government from
what Thatcher's Government had implemented in the UK in the 1980s.
CCT involved a mandatory exposure of local government services to competition through a process of public tendering.
Between 1994-99, municipalities in Victoria had to expose annually 20%, 30% and finally 50% of their council's budget to
CCT (O'Connor 2000). And since the budget included non-cash items such as depreciation, it was pretty common for the fifty
percent of budget to really mean around sixty to seventy percent of recurrent expenditure. In Victoria the role of elected
politicians was gradually restored, but Councils were threatened with dismissal if they did not comply with the policy and meet
the targets. It was a much more severe application than CCT in the UK. For the Kennett Government, CCT represented the
rationale that public service providers were inherently less efficient than their private sector counterparts (O'Connor 2000).
CCT was seen by the community as being driven by dollars and causing a reduction in services in a whole lot of practical
things like roads, drains and garbage. CCT didn’t include asking people and was ‘us versus them’, and also one part of the
council against another.
CCT was just one part of the blunt instrument applied to local government (Van Gramberg & Teicher 2002). The Kennett
government forced every council to cut taxes by twenty percent, and then cap growth of rates and charges to the Consumer
Price Index (Aulich 1999b). The immediate effect was that the forty thousand employees in the system dropped to thirty
thousand within one year. Councils had to specify what they did and put it out to the market - instead of just doing what they
did. This created a purchaser-provider split, where the main role of council was to purchase services from the open market, and
that market consisted of ‘entrepreneurial’ sections of that council or other local governments councils, NGO’s, and private
sector businesses. Whilst CCT was advocated by the state government as being a tool to free-up local governments, to let them
be about ‘steering and not rowing’, in reality what ensued was a pragmatic and compliance-based response (Aulich 1999a,
1999b) (Van Gramberg & Teicher 2002). A plethora of performance measurement and reporting became the basis of the
State’s control over local government.
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Under CCT and associated reductions in taxes, recurrent expenditure levels held up. But capital spending collapsed, providing
a serious erosion of infrastructure and creating a liability for future generations. Many councils simply did not have, or could
not get, the experience in contract management necessary to successfully deal with CCT. Before CCT a few limited services
were typically contracted out, like IT and tax advice.
A few councils handled the tendering out successfully, but mainly in the blue-collar things like road maintenance and parks
and gardens. For councils found that even simple things, like responsibilities for various things that can go wrong with plants
or fittings in a park, are hard to fix into a contract.
With CCT, contractors came far and wide - including from the UK and New Zealand, and some tendered below cost to get
market share. CCT devastated many local communities in the less-densely populated rural areas whose councils were often the
biggest local economic unit by a long shot. When these councils were forced to tender out the majority of their services to the
marketplace, their internal business units lost most of their work to the private sector or bigger regional councils. A lot of the
work – and there fore the jobs – went to large contractors based in metropolitan or regional cities outside the rural council area.
As a result, families in rural area who had lost employment left for the bigger cities, and as towns quickly decayed, butchers,
banks, medical services and schools also closed. People suffered but so to often did the quality of services. There was stress, if
you did not win the tender you could loose you own job, or your whole crew - people you knew well and had long worked
with. For example in a fringe council with poor employment prospects, its engineering section was forced to tender for
ongoing signage work, but missed out on the contract. Ten staff automatically lost their jobs. The same thing happened with
much of road maintenance. The quality of that work was affected with strict budgets under CCT - practical things like how
much rock on the road. It was dollar driven, not quality driven. (Solli, Demediuk & Sims 2002 ).
So how apt is the Atomic Bomb metaphor? CCT was cataclysmic for small regional communities and for its initiating
government. Whilst the Atomic bomb unleashed a retaliatory fury that leveled that city, so did the CCT reform decimate the
economic and social fabric of country Victoria in a way almost unimaginable before the event. And the bomb and the reform
have produced aftershocks still keenly felt, and both were perpetrated by those viewed by many as the rich, powerful,
dominant and uncaring. Within six years the regional communities had had enough of that Government in general and CCT in
particular, and in 1998 the Liberal Government was voted out of power when the Opposition gained seats in these small rural
areas and joined with three newly-elected Independents. This unexpected win took the heat out of closing hospitals, schools
and infrastructure and got rid of Thatcherism – but much of the social, political and economic damage was irreversible. For
people who lived through CCT in the larger cities, Atomic Bomb may seem like an over the top metaphor. After all, the large
cities did not suffer the same degree of job losses and many of the dollars cut from allocations to rural areas ended up in
infrastructure projects like roads, galleries and grand-prix races that benefited city dwellers. But for those that lived through it
in small communities, CCT was utterly devastating (Solli, Demediuk & Sims 2002 ), so at least for them the metaphor is
sense-making.
Best Value
Various iterations of the New Public Management (NPM) have reached all tiers of government in Australia, and the State of
Victoria has adopted a ‘Best Value’ (BV) framework for local government that is concerned with improved performance
through a rational model based on community participation and cost and quality standards. The Best Value Victoria legislation
in 1999 required all local government councils to progressively review every service they offer by 2005 to ensure that they
accord with Best Value principles. The Best Value Victoria paradigm reframed the nature and form of public sector
governance and decision-making through new demands of value for money activities that anticipate and match changing
community needs and priorities.
Best Value originated in the UK under the Blair government, and is located at the intersection of two movements – new public
management and advocacy for community and local governance (Boviard & Halachmi 2000). As a result, Best Value has its
roots in the new paradigm, but seeks to extend beyond it (Martin 2000; Martin & Hartley 2000). So in common with other
results-based NPM initiatives (Hood 1991, 1995), the Best Value reforms which demand improved performance, and the use
of rational planning processes as the particular method of securing these improvements (Boyne 1999; Jaconelli & Sheffield
2000). Additionally, unlike previous NPM reforms, the community and local governance focus in Best Value requires the
inclusion of community consultation and participation in these rational planning processes (Boyne 1999; Jaconelli & Sheffield
2000).
Best Value was introduced into the State of Victoria, Australia with the objective of improving “… the delivery of Local
Government services by making them more affordable and more responsive to local needs and to encourage councils to engage
with their communities in shaping Councils’ services and activities” (LgPro 2006, p. ii). The change in government and the
replacement of CCT with Best Value brought an optimism that councils could govern in genuine partnership with their
communities (Van Gramberg & Teicher 2002). Ideas can travel faster than some governments can legislate, so whilst the idea
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of Best Value and the term were forts talked about in the UK, the State of Victoria adopted and implemented the idea through
legislation about 3 months before it officially came into play in the UK.
Rather than defining what is ‘Best Value’, the Best Value Victoria legislation (Local Government (Best Value Principles) Act
1999)requires all Victorian councils to progressively review every service they offer by 2005 to ensure that they accord with
the six Best Value principles that reflect a community focus in processes and performance:
1. cost and quality standards for all services
2. responsiveness to community needs
3. accessible and appropriately targeted services
4. continuous improvement
5. regular community consultation
6. frequent reporting to the community.
In developing cost and quality standards, councils are to take into account a range of factors: best on offer in the private and
public sectors; value for money; community expectations ad values; a balance of affordability and accessibility; opportunities
for local employment growth; partnership building with other levels of government; and environmental sustainability.
Specific objectives linked with adherence to these principles are: local accountability; a whole-of-organisation response;
consultation on performance; Best Value outcomes; benefits, not costs; and encouragement of innovation. The innovation
objective arises from the expectation that the Best Value framework will encourage councils to adopt innovative and creative
responses to service delivery, including a range of partnering relationships (DOI 2000a, 2000b).
In Australia the expanding interdependencies between politics, administration and the community (Marsh 2002) are strongly in
evidence with the explicit community consultation focus of Best Value reforms to local government (DOI 2000b; LgPro 2006).
Those NPM reforms which explicitly require substantial community engagement may require a reconceptulisation of civil
society and the state in a new policy framework that requires “.. an informed, inclusive and discursive citizenry that promotes
the democratisation of decision-making mechanisms of the state and supplements and extends traditional expressions of
representative democracy (Reddel 2002, p. 57; Wang 2001; Yang 2005). In such contexts, governance requires shared
stakeholder inputs in driving strategic change based on stakeholder analysis and communication strategies (Reddel 2002).
Best Value Victoria allows local governments the latitude to take differing approaches to the implementation of the broad Best
Value Victoria principles, councils have responded with a range of strategies which ultimately frame the nature of decisionmaking. The Best Value approach in Victoria is quite different to that taken in the UK where a compliance approach based on
external audits, performance indicators, benchmarking, league tables and ‘lighthouse’ councils predominates. In Victoria, it is
up to individual councils to determine objectives, their measures and targets, and how to report them in reviews of each service
area (LgPro 2006). In Victoria Best Value only requires councils to report every year and there’s no penalties and no
sanctions. During the reform process of CCT and that much maligned Liberal State Government, the reform process got senior
ministers. But now Local Government only gets a relatively inexperienced junior minister.
Conceptualising Community-based Governance Reforms
Epstein et al (2005) have constructed a model of effective community-based governance which holds that the generation of
community conditions is dependent on the action and interaction of three elements: community engagement, performance
measurement, and the getting things done (development and implementation of government policy), and this matches well with
the characteristics of Best Value Victoria.
Linkage 1 is the two-way intersection between government policy and implementation and citizen engagement, and is
described as ‘citizens engaged in government policy and implementation’. This involves activity which aligns government’s
plans and action with current and changing needs and priorities of the community. Best Value Victoria requires all government
activity to be aligned with the ultimate delivery of services to meet community needs. Linkage 2 is the two-way intersection
between government policy and implementation (getting things done) and performance measurement and reporting (measuring
results), and is described as ‘performance management by government’. Performance management involves a two-way
interaction: having the right performance information to drive rational decision-making, and capturing the effects of the action
with performance information. Maximizing this intersection is what is required in Best Value – having rational decision
making and providing robust accountability for and about action. It is important to note that all implementation of the policies
of government might not necessarily be carried out by Government itself, but potentially other stakeholders like community
groups, NGOs, and other levels of government. Linkage 3 is the two-way intersection between performance measurement and
reporting and citizen engagement, and is termed ‘citizens engaged in measuring performance’. This intersection constitutes
community input into decision-making about: the selection of performance measures, the setting of targets and standards, and
systems for the collection, reporting, analysis, feedback of information, and reaction. Best Value Victoria requires that
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community consultation underpins the setting of objectives. Linkage 4 is the three-way linkage of citizen engagement,
performance measurement and reporting, and government policy and implementation and is termed ‘strategic alignment’. This
opens up possibilities for decision-making that leverages private and public resources to find stronger and more appropriate
solutions to changing community needs and priorities. It is precisely this theoretical notion ‘strategic alignment’ which is
needed in practice for councils to be able to both actually provide Best Value services, and prove that they have done so.
Under the explicit principles of the Best Value Victoria framework, maximizing the amount of intersection between the
elements of getting things done, engaging citizens, and measuring results is critical if the community is to receive the services
they need at a price that they are willing to pay. In practice, the way individual councils align the engagement, policy and
implementation and performance measurement elements will shape their Best Value processes and Best Value performance.
Since there are no particular instructions in Best Value Victoria as to how councils should approach the task of maximizing the
intersection of these elements, exploratory research is needed to examine the experiences and practices of councils. In the
following sections we report on the perceptions of senior managers and politicians of about Best Value thus far, and its future.
The findings from our research are then contrasted to the views of the Best Value Commission.
Research Methodology
As Muriel Rukeyser the poet said: the universe is not made out of atoms, it's made of stories. Stories are important for us to
understand the reality facing managers and stakeholders, and make issues discussable - for “… what cannot be discussed
cannot be improved, at least not intentionally” (Jonsson 1996, p. vii). Guy Peters (2000).argues that by interviewing
individuals in an organization about their work and context, one can get a valuable microscopic analysis. With this microscopic
lens, one is not attempting to get neat statistical and generalisible findings, but to see the gritty reality these individuals face
(Silverman 2000), and identify themes and variations for future research. In such exploratory studies, qualitative
methodologies are appropriate as they are structured around discovering themes and variances which can improve our
understanding of a phenomena and inform future research (Miles & Huberman 1994).
This research uncovers and examines stories about how managers and politicians in ten of the 79 Victorian Local governments
have met or molded the Best Value reform. At each of the councils the interviews were sought with the managers with direct
responsibility and knowledge about the operations of the Best Value program. In some cases this involved a single person, but
in most cases constituted a panel of executive and service delivery managers - and some councilors. Where more than one
person was interviewed at a council, responses were aggregated into one unit of analysis for that council. The semi-structured
interviews averaged one hour.
Council Experiences with Best Value
Our interviews were held early in 2007, when the five year period for reviewing and reporting on Best Value service provision
of all service groups had come to an end. The Best Value Victoria legislation is still active in that the principles have not
changed, but councils are free to review and report back to their constituents as they see fit.
Our interviews with council managers and politicians were designed to capture stories about their experiences with Best Value
over the intervening years. We are looking for themes and variations in practices, orientations, influences, lessons learnt, and
senses of future directions. We have found that the emphasis on maximizing community engagement has been operationalised
quite robustly in areas of planning and risk management, but organisational silos still abound.
It seems to be universally accepted by interviewees during both sets of our field study that the draconian CCT created a bad
environment for communities with a focus on cost and an absence of community consultation about the nature and scope of
services, and Best Value is a more reasonable approach. But now councils are at a crossroads with Best Value. From 2006,
councils are still obliged to operate under the principles of Best Value, but the requirement to carry out service reviews against
Best Value criteria ceased. In essence, councils are free to play the game in any way they want. Some have even changed the
name of the game, calling the new approach ‘continuous improvement’ or ‘organisational development’ and such-like.
Community Engagement and Planning
There is a requirement by the state government for councils have a corporate plan. With Best Value, many councils have
striven to make this corporate plan a community plan - one driven by community needs and preferences. For example, an outer
metropolitan council has ‘Vision 20/20’ council plan as its over-arching principle, and individual council strategies and
objectives flow from that. The council plan is seen by the politician and management at this council a ‘community document’
that reflects citizen input. It is very deliberately not spoken of as the council’s document. As one manager indicated: “The Plan
is created, approved and developed by the community, and Councillors take the vision document everywhere and use it to
explain, justify or predict decisions”.
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Clearly, most councils had gone to considerable lengths to at least align their plans with community needs, and avoid the
danger is consulting with the same old suspects every-time: “… the squeaky wheels and the hobby-horses”. For example in the
last two years in a sea-side council, councillors visited every community and interest group, there were a lot of positive
suggestions and a community plan was formulated.
New strategies have been adopted to garner people’s views, such as ‘café conversations’. Here councils advertise times that
councillors and officers will be in a particular café for a particular time for the community to chat to and its got fairly good
results. With the ‘speakout’ strategy, officers and councillors go out to tents set up in the main streets and community fairs of
the biggest local towns and typically a couple of hundred people will come through to talk. But as one interviewee noted: “All
the same, they (the community) will turn up and have their say about whether to seal a road or not but usually won’t get
involved if it’s about how do we go in the future”.
Perhaps the most significant finding in this research is the degree to which corporate plans have become reflective of
community desires, and how radically this phenomenon impacts on the ways that council must operate. The trend towards
corporate plans which reflect community needs and preferences has forced dramatic changes in the business of local
governments because it changes the scope of challenges. In the past, Council plans tended to reflect traditional areas that the
council did and had strong control over – such as rates, rubbish, roads and recreation. Now council visions embody a much
wider palate of colours that describe aspects required for a good quality of life by the community such as education, transport,
and employment opportunities - many of which are out of direct control or traditional purview of local government.
The much wider range of policy agendas now typically found in council plans spills over into council meetings. When we
asked our interviewees about the sorts of things that come up in council meetings, a pretty common scenario is that if you look
at the agenda of the council you will see that 50 percent relates to topics that the council doesn’t have real power to change
directly or on its own. Things like providing good conditions for businesses and better infrastructure. So since the inception of
Best Value and broader consultation on vision and objectives, councils have to work hard in lobbying and thinking laterally.
To be able to achieve objectives that come from the planning document being a community document, councils have found
that they need to apply a strategy to work through others to achieve those objectives. Some examples of such a strategy provide
good illustrations of the strength and direction of this new way of operating for councils.
For example, one manager notes that “we work through friends groups, friends of the rivers and parks so council staff are
active in engaging the support of people and giving support in a reciprocal way. So dollars come from the council and the
friends groups supply the hands on the ground and a lot of the thinking and organizing”.
Another good example of having to work with others to achieve what the community wants is in the area of education. “The
community had the vision for educated community, to have low cost education accessible to the community. We do this with
neighbourhood houses …another is a partnership with the University where we do joint projects, lectures and developments”.
The council was extremely active in getting the University to come out to the area and establish a campus in the first place.
The plan describes it as a living and learning community, so the council and University work together to help achieve that.
This is a really clear example of the need to work with and through others when the community sets bold plans and agendas.
As one manager explains: “In the past, our strategic plans focused on the organization and now there is a shift so councils like
to see themselves as a facilitator of creating good conditions for citizens, rather than providing services directly. We have to
stimulate and encourage the formation of community groups to do special things”. For example, the council gave an old Shire
building to a community group in a small town and paid for its renovation. So the community group that runs the building and
others use it to provide services that the council doesn’t. Things like mentoring, training young people to be local leaders and
recreation activities are staffed and organized by the community for the community. Without the provision of the property and
insurances these things would never get done and community strengthening activities would be much weaker.
Another example of councils becoming facilitators or advocates of good conditions rather then narrow service providers also
illustrates the potential of a ‘joined-up’ approach. This concerns a huge problem for outer metropolitan councils - the lack of
transport facilities. A group of councils have fought hard for better access and cost of public transport in the outer areas. They
have had a big win in reducing the costing of tickets on the train and buses and that was driven by the mayors and CEOs of
fringe councils. So councils do act in an advocacy role in some situations and in others act as a facilitator when they have more
power, influence or resources. This is very, very different to the cost based service orientation of CCT days. Whilst not all
councils would claim to have the same degree of ‘buy-in’ from the community into their formal plans, all gave examples of
their role expanding away from the strictures of traditional service delivery.
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Community Engagement and Risk Management
Our interviews have found that another major theme that grew in importance over the last five years is risk management, and
especially how it is linked to community engagement. Risk management sections in councils pre-Best Value used to be a
insurance departments who paid claims out, but now risk management gets new thinking. Things like business continuity, if
the place is destroyed council needs a plan in place to continue to meet our commitments to the community. Risk management
is sensible and obvious, but managers report that they don’t have complete support for risk management across the
organisation because many people see it as an add-on requirement forced on them by another department. As one explains: “If
I am a planner… I don’t need to worry about risk, so don’t stop me mid-stream to make me waste my time with this risk
management stuff”.
There is a growing realisation that you can contract out your work but you cannot contract out your risk, you are still
responsible for your contractors. As one manager explained: “In the contractor group, we have 105 preferred suppliers - and
good relationships with these people. We’ve now got a culture imbedded into contractors that they can’t do things wrong and
they can’t cut corners. We need evidence of how they’ll handle risk and how committed they are. We recently had a 250k
tender, one contractor allowed 2k’s in that budget for traffic management and another allowed 25k’s in it for traffic
management. The lowest tender didn’t win because we want reasonable dollars but we need to see how safely they’ll do it. It’s
taken 3 years to develop our contract management system and a big effort to provide contract supervisors with the right
information. Another way we’re handling the cost and quality thing is to fix a price on a job, say 250k and you bid not on your
price, but the quality you offer for that 250k, that way we can get a price we can cope with and establish the best quality for
that amount, we get something reasonable which is the least the rate payers can expect from us. Our OH&S (occupational
health and safety) plan is based on forms but they’re tailored to the type of work, for example a one man grader business will
have a much simpler set of documents to complete than a contractor doing many tasks. It’s fine to have a system but that’s not
what’s necessarily happening on the ground, so we physically check works as they happen”.
Another example of OH&S dangers is the risk associated with having home carers on a council’s books. Home care gives
many councils their highest numbers of injuries as people work in an uncontrolled environment. Each time they visit a site, the
environment might change, there are unmade roads, slippery driveways and such like. Councils have to do much more training
of staff about manual handling. Their people who do home maintenance typically do things like guttering and install handrails.
New laws make working off a ladder pretty much illegal and expensive and time consuming scaffolding needs to be installed.
One example across a myriad of services provided by one metropolitan fringe council concerns the removal of trees. Council
risk assessment officers and parks staff, which include professional arborists, may tag a tree for removal on grounds of safety if
it is though to be unstable or likely to drop limbs. Because of the environmental leanings of council and much of the
population who consciously chose to live where the city meets the rural areas, local by-laws require permits for partially or
fully removing trees. Councillors and officers consult with the citizens about particular cases. This engagement can cause
tensions between management and other stakeholders, and bring up the issue of how to balance the professional judgement of
managers concerning the likelihood of occurrence and potential impacts of a risk situation compared with the level of risk that
citizens are prepared to live with. As a manager put the conundrum: “One person from the community may wave the
environmental flag, and I am waving the safety flag – so councillors have to use the engagement process to decide on
contentious situations”.
Another example of the focus on engagement and balancing risk concerns the local lake at an inland council. About 15 years
ago council installed a sand beach on the lake since the Shire area is at least 50 kilometres from the sea. It is a well used and
loved feature, but there have been several drownings and concerns about the dubious quality of waste water running into the
lake from housing developments on a nearby mountain range. Community engagement is required to establish whether citizens
are prepared to keep a much loved facility with the attendant drowning and health risks.
Community Expectations, Interests, and Engagement
A strong sentiment detected in interviews is that resident expectations are constantly increasing. As one interviewee put it:
“Residents expectations increase at faster rates than our taxes and charges do - people are more demanding and want more
things done, and done quicker. People don’t want to do anything themselves these days. In the old days, my father got a shovel
and cleaned out the drains, now people want the council truck to go and do it”. To what extent this may be an artifact of
increased consultation, or a reflection of other societal variables is a matter for further research.
But engagement has proved problematic in terms of getting interest or avoiding hearing only narrow vested interests.
Community meetings can be rail-roaded and stacked by people interested in the environment or special interests, for example
the wine industry and agriculture. Football clubs put pressure on councils as they want to train players but are currently banned
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from training on the grounds due to drought. And with senior citizens and childcare consultations, it’s hard to get a good crosssection and sometimes the silent ones have the greatest and least understood needs. With community engagement, who shows
up and who answers the questions? It is often groups, such as football groups or friends groups. The more immediate problems
get the big responses. For example, a manager explains that “… we had a problem with a compost facility, smells and all that,
and ran a meeting. Not a chair was left empty, it was a full house as more than 500 people turned up. In contrast, when we ran
a Best Value meeting for a local council unit we sent out hundreds of letters and put public notices on buildings and in the
local paper. Four people turned up and that’s even more of a problem because you’re not tapping into a reasonable crosssection of the community. Another example, we’ve had fires in the area and people come from everywhere to attend those
meetings. In contrast, a meeting on our 20/20 vision statement got small numbers despite putting on free morning teas and that
sort of stuff”.
Getting the interest and attention of stakeholders seems to be easier the smaller the council population. For example, a small
rural which was worried that it was disengaged from the community and levels of satisfaction surveys were poor. It hired
consultants to knock on doors and organize meetings. People said they needed transport to get to the railway station, they
needed more doctors, and things like that. They found that there was a complete mismatch between what the council was
emphasising and peoples’ wants. They were concentrating on roads, roads and roads and people wanted the council to
advocate for them, to plan for them and to facilitate for them. So they built a consultation process that’s really working.
They’re acting to lobby other Governments and fix some of these problems and community satisfaction has gone through the
roof. Where councils have all amazing results with community engagement and planning and action, it seems that engagement
and action has been picked up well in small rural communities.
The larger metropolitan communities have by and large not reported as robust interest from the community in engagement, but
some are having a crack at doing the engagement thing better. A large progressive metropolitan council with a population of
160,000 who are looking for a way of getting the communities views embedded and are trying the ‘America Speaks’ system
which has a technology approach to capturing and prioritising views in large public meetings. That council is indicative of
areas which have had a significant increase in apartment-dwellers and no formal way for people to meet and get information.
As an interviewee reported about life in these apartments: “For instance, post boxes in the shared area are secured so you don’t
get the community leaflets. If you have meetings, it’s usually about Body Corporate issues which are frequently centred around
arguments and disputes. So as cohesion falls you’ve got to work harder to increase community engagement and capture views
in a methodical way”. How technology like that of America Speaks coupled with large civic meetings works is a useful field
for further research.
Organisational Silos and the Clash with Other Reform Initiatives
One problem with Best Value is that when it became legislated and the adoption was forced, it became seen as an add-on. This
is perceived as having some negative effects. Firstly, the imposition of Best Value as a reform effectively scuttled many quite
well developed improvement programs that some councils had already adopted. For example, when one major city had
introduced its own version of a Best Value program before the state legislation, that reform seemed to become part of the norm
because it was taken up organically and looked more like a business excellence frame-work that seemed to cut across typical
silos in the organisation. So when the mandated Best Value program came along, it derailed the previous initiative and
because of its very nature in requiring individual service reviews and being run by a separate Best Value ‘office’, pushed the
organisation back into a silo mentality . So Best Value maybe had a good outcome in helping increase performance of not so
well performing councils which at that time had little in the way of innovations, but could be argued to have collided with the
improvement of programs at better performing councils. In addition, many interviewees criticized the tendency for the Best
Value team within a council to be, as one participant put it: “… a locked up unit, a bunch of people who worked quite
separately on their own”.
All of the councils interviewed had completed the mandatory Best Value reviews, but our conversations suggest that where
these reviews had helped staff see their own goals and identify areas for improvement, the reviews couldn’t connect them to
the big picture and to show them where their work fits in. Best Value has perpetuated and indeed in many cases reinforced a
silo approach to service planning. To counter this, a number of councils are planning a new approach post the mandatory
review phase. The plan is to cluster all of a council’s services – be they delivered to the community or internally to the
organisation - into anything from five to fifteen ‘service sets’. For example, one service set could be for elderly residents who
live at home, and library, meals, social work, maintenance and other services could cluster around and contribute to this
service set. Service sets would be run by newly constructed service panels, which are given a strategic review statement, trends
in demographics, information and opportunities, and they will make decisions about priorities and support budget bids. So
whereas in the past people have planned functionally, now they will be forced to plan across functions and concentrate on
services. One problem area here that is yet to be fully addressed is that people are worried about how accountability will work
if it’s not line managers that are in clear control of what happens.
7
Engagement will be critical to the success of initiatives like the service sets which are designed to free council work from silo
constraints. The hardest part is not to get a judgement made about the cost and quality of a particular service, the hard thing is
to judge what services do we need relative to others. So prioritising mixes services rather than evaluating individual discrete
services is the biggest thing to get from the community rather than just their opinions on a particular service.
Best Value as Catalyst for Building Profile, Networks and Professional Development
Best value has a very different spirit than CCT as it’s built on an idea of local government as a legitimate and important
‘industry’. So in this way, Best Value has enhanced the visibility and importance of local government in the eyes of a range of
stakeholders - both through consultation processes about needs, and the publication and dissemination of performance
information. Best Value also provided professional challenges to managers due to its ambitions about quality, cost,
improvement and consultation, but also due its non-prescriptiveness. Managers and politicians were thus challenged to think
and act in very different ways than before, and this accelerated the development of professional networks and professional
development initiatives. As one manager explained: “It gets people to think about sharing ideas, and to realise that different
people read the meagre Best Value instructions differently and set councils on different paths. So it’s been great for people’s
professional development to see how different councils have moved and progressed towards the same goals”.
Best Value and Cost-Effectiveness
Some interviewees have challenged the rigour of Best Value in maintaining cost-effectiveness, and point to tax and charges
increases. Indeed, there have been some classic swings in taxes in the 12-14 years of CCT and Best Value. Victorian councils
were the highest taxers in Australia in 1992 on average. By 1994, because of the rigours of CCT, enforced rate cuts and caps
on rate increases, Victorian local governments were the lowest taxers in Australia. Under Best Value with no enforced
restrictions on rating, Victorian local governments are the highest taxers again in the land. Now recurrent costs are running at
seven percent increase which is five above the CPI. As one interviewee put it: “ … there is absolutely no heat on councils from
the State Government in terms of spending and service delivery … to make councils fix things and get more efficient and
effective”. And as another warned: “ I am saying to our people now, if you don’t start to drive some more efficiencies, there’ll
come a day when the State Government moves on you again in ways that you wouldn’t want”. Unless things change from
internal efforts by councils, there is a perception from some managers that the heat will come on in political and funding terms
from the State and Federal Government.
Comparison of Findings to Best Value Commission Reports
The Best Value Commission was set up by the State Government to advise on the progress of the Best Value reform. The
Commission has formed a view about the attitude of councils and their implementation approaches to the reform from 2001
until the end of 2005 (Best Value Commission 2006) which we will contrast to our own findings. Our findings concur in many
areas with the Best Value Commission’s broad views of what has happened on the ground, up to the end of the mandatory
review and reporting phase. Both the Commission’s findings and our interviews saw high levels of support for the Best Value
reform and evidence of positive benefits in terms of service delivery. One issue that the Commission’s reports have failed to
articulate however, is the finer detail regarding the challenges of community engagement. Our study has uncovered the theme
that engagement is much, much harder when it is long term planning issues that are ‘on the table’, rather than issues about
immediate decisions or controversies. So the danger is not so much the onset of general consultation ‘fatigue’, but more about
the imperatives of experimenting with new strategies (like America Speaks) to meet this challenge. Neither are the
Commission’s reports alive to the theme of the reform actually perpetuating, if not exacerbating, a silo mentality in councils –
and the need for experimentation with new organizational designs, structures and performance measurement regimes to counter
this trend. But possibly most important of all, the Commission has not reflected on the change in the very nature of the business
of local government – the addition of much stronger advocacy and facilitation roles that go with Council plans that now reflect
a much wider agenda for improved community conditions than was typically the purview of local government. These changes
have implications for financial and human resourcing of local governments, and the way a ‘joined-up’ approach to governance
needs to unfold. The Commission does not seem to have detected how inter-twined risk management has become with the Best
Value programs and community engagement, and the consequent need for best practice information and training in this area.
Finally, our research has highlighted the difficulty in getting community consultation to a level where enables rigorous
selection and prioritization of services, rather than being about specifying or critiquing individual services.
Best Value as Aromatherapy?
"Aromatherapy" is the word coined by Henri Maurice Gattefosse in France in 1928 to describe the art and science of helping
living things toward wholeness and balance using the essential oils which can be extracted from plants
(http://www.thedance.com/herbs/arwhat.htm). So is aromatherapy a misplaced metaphor for Best Value?
8
From what we have described in this paper, possibly not, since Best Value is designed to give people a holistic balance of what
they need and what they are prepared to pay for – and much progress has been made in identifying and improving community
conditions. So some might use the metaphor as a positive affirmation of the Best Value reform. However, as was argued in a
previous section, there is a danger that the even less prescriptive approach to Best Value today might allow for further costeffectiveness problems to emerge, or the impetus of the reform to dissipate - thus forcing the hand of the State Government to
act. So some may use the aromatherapy metaphor whilst seeing, understanding, and shaping the situation in a very different,
and much more negative way.
Another conclusion may be drawn from the responses to the question we put to all interviewees after we received the
metaphorical quote: “It has been suggested to us that Best Value is something like aromatherapy – would you agree?” Most
laughed, but nobody disagreed. That tells us something. The metaphor seems appropriate – but the sense-making could be
taken any way.
But yes, we agree Best Value can be like aromatherapy in a positive sense. It can, and has, provided councils and their
communities with a more holistic approach to improving community conditions. And whilst Best Value is a much-much softer
approach than CCT, it can be argued that it is actually a more rigorous reform because it has proved to be more sustainable.
Conclusion
Whilst this research has limitations in being exploratory and not providing a representative sample of Best Value program
activity in Victoria, important and interesting themes and variations have been evidenced thus far from 10 of the now 79
Victorian local governments both early in the reform process, and now at an important cross-road in the future shape and
direction of local government.
It has been quite a journey for local government in a relatively short span of years - from the heat and destruction of CCT to
the softer and more soothing reform of Best Value. There is strong consensus in our interviews that along the way, many
things have got better and some have stayed the same or got worse. By far the biggest change heralded by the focus on
community engagement is the trend and ability for councils to have corporate plans that are reflective of what the community
wants. This has lead to a much expanded role for councils, going from an emphasis on: service provision before CCT; service
purchasing during CCT; to service provision and purchasing but also facilitation and advocacy for good community conditions
during Best Value.
From our interviews, we expect that the approach of councils for 2007 and 2008 will be to maintain vigilance on cost and
quality aspects of services that occurred under the Best Value reviews, but to expand the context for analysis from an internal
to external focus via benchmarking the cost and quality of services against other councils. Whilst council literature and policy
still widely mention the ongoing nature of the Best Value reform, in reality most people have tagged the future with the
reform-mark ‘continuous Improvement’ or ‘organisational development’. And so the term Best Value has started to loose
currency – especially since the demise of mandatory review and reporting obligations which had consumed considerable time
and other resources
Whilst the Best Value campaign of the past was based on an internal focus on continuous improvement, continuous
improvement is now moving to a focus about “how we deliver the services in the context of how others do it”. So further
research is needed to examine how councils do, or should, bring in a performance measurement orientation with an external
reference point. Or as one interviewee put it: “to change to management by data and information - which is not natural in our
local government’s culture”.
Perhaps the most challenging and interesting thing will be the application of new internal planning processes and organising
structures to break the disconnect between individual council services. This disconnect is a product of the silo mentality that
was reinforced by Best Value. Best Value legislation as it applied up until 2006 seems to have created a culture of compliance
in improving individual services rather than a commitment to organization-wide ‘joined-up’ activity. The version of Best
Value from 2007 and beyond, whatever the reform-mark, needs to much more inclusive in terms of collaboration within and
between service groups and the range of stakeholders.
In reacting to critiques and pressures for change, one strategy is to adopt a response that is convergent with the dominating
norms and values that have become the prevailing doctrine in the external domestic or international arena. Such ‘isomorphic’
adoption involves mimicry of a persuasive myth to retain legitimacy (Czarniawska 1996; DiMaggio & Powell 1983). At
another extreme, an alternate strategy is to adopt reforms because of their technical efficiency to solve the particular problems
that confront organizations. Such reforms may be adopted because of perceptions of effectiveness that demonstrated to varying
evidential standards in the discourse on external reform plans, reform implementation, or reform effects. The nature of the
administrative and political contexts of local public sector organisations edits the form in which external reforms are adopted,
9
and the closer the alignment of the internal and external contexts, the less alterations are likely (Sahlin-Andersson 2000)
(Brunsson 1993). Reforms implemented for reasons of technical efficiency can also developed internally rather than be
adopted from external cues, and parallel similar reforms developed externally principally because solutions were sought
independently to common problems.
There is little evidence in our study of isomorphic adoption of particular methodologies for approaching the 6 broad principles
that frame Best Value Victoria. As far as out limited sample suggests, the approaches of Victorian local governments to the
implementation of the Best Value framework appear to have many common ingredients, but are essentially applying different
recipes and different rates of progress. The councils studied are, by and large, attempting to implement the reform in ways that
match the local context. It looks very much like attempts at developing technical efficiencies to meet the six Best Value
principles in a way to solve local problems with the development of local solutions.
A final comment is required in reference to Epstein’s model for effective governance - which advocates increasing the
intersection between community engagement, policy and implementation (action or getting things done) and performance
measurement. The progress under Best Value in increasing the intersection between action and community engagement has
been impressive. Early in the Best Value regime, no councils touted that the plans that guided their work were actually an
artifact of the community. Now most councils claim something like: “there are not just our plans, they are the communities
plans”. It is no small achievement therefore that by the end of the first phase of Best Value, the end of mandatory reviews, all
councils claimed that their vision and policies were more or less in line with the community mind. However, the slowest
progress in realignment of the performance measurement element with the other two. In our interviews, we did not get a sense
that there is a robust intersection of performance measurement with the community engagement and action. Further research is
required into mechanisms whereby the work of government and the needs of the community can be effectively built into
performance management systems.
10
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