2 What is decentralisation?
There is much debate concerning the definition of “decentralisation” (or “centralisation” as the converse), especially with regard to how its definition differs from that of “devolution” or “delegation”. For the purposes of this paper decentralisation is taken to mean the locating of decision-making rights or responsibilities away from the centre, whether this be to a Crown entity from a Minister, to a department from a central agency or from a department’s head office to a regional office. Typically decentralisation involves the spreading out of decision-making authority from a smaller to a larger number of actors (Pollitt, Birchall and Putman 1998). The discussion in this paper concerning the allocation of decision-making rights applies also to the decentralisation of operations, resources and the allocation of rights more generally. These rights might include: the right to initiate or propose, the right to ratify, the right to veto, the right to set conditions, the right to determine in the event of a dispute, the right to deal with exceptions, the right to allocate resources and so on.
Centralisation (and decentralisation) should, for the purposes of this paper, be interpreted in a broad sense. That is, centralisation does not necessarily refer solely to decision-making by central agencies or ministers. For example, centralisation may occur at a local level or at a regional level. The location of decision rights (centralised or decentralised) is not intended to be a linear concept for the purposes of this paper. Rather, it may be multi-dimensional with the solution to (de)centralisation questions likely to lie in a combination of centralised and decentralised decision rights.
The issue of centralisation versus decentralisation is particularly relevant in the context of the new communications and information technologies becoming available, as well as in light of the Review of the Centre report[3]. Improved communications and information technologies change the costs of information and of information exchange. This may in some cases mean it is easier to centralise decision-making, as information is more easily transferred to the centre, similarly, in some cases it may make it easier to decentralise decision-making.
This study aims to provide a building block for thinking about centralisation or decentralisation decisions coming out of the Review of the Centre (particularly in the areas of human resources, central agency leadership and e-government).
Notes
- [3]“The Review of the Centre” report presents the findings and recommendations of a review of the centre of the New Zealand State sector conducted over a four-month period in 2001 by a Ministerial Advisory Group.
