Globalisation and regional governance  

Dr. Don Edgar, Alice Springs National Conference on Municipal Governance, 2003

Australia is stuck with a complex, but very 'thin' form of democratic government.

We vote once every few years for a federal government remote from the concerns of particular regions because of the dominance of cabinet over constituency politicians and because of the central managerialism of Canberra. We vote also every few years for a State government likely to be of a different political color from that in Canberra, with all the resultant difficulties of cooperation and coordination across the federal-state divide. And some of us vote every few years for a local government much more closely allied to our everyday concerns and quality of life, but which is inadequately financed by the states and rates and not recognised properly as the key to implementing change at the regional and community level. Beyond those occasional votes, there seems little demand by the wider public for more active involvement in planning, political policy development or participation in the implementation of policy. And at every level of government, central managerialism rides rampant, with scant concern for the diverse needs of regions and communities in this very 'Patchwork Nation'. It is a thin, rather than thick democracy.

It is highly unlikely that Australia will ever see regional government taking over from the States and local governments - vested interests and tradition are strong - and we have missed several chances to consolidate moves towards better regional and rural development models. But there is no reason why we could not develop better governance, better processes of using our tax money, at the regional level. What is required is a recognition of emerging realities in a globalised world, and a concerted effort to change the culture of governance to one that actively engages the public in deciding what is best for their own present and future.

We should not waste time on arguments about small versus big government. What we need is more intelligent government, forms of governance more responsively attuned to the growing regional disparities in what I have called 'The Patchwork Nation'. The report to be released later today shows that inequality of regional incomes has worsened since 1998; the top 6% of our population lives in regions which create 20% of the nation's gross domestic product. It stresses that competition in a global world is more between regions than between nation states and we have to re-think our forms of governance to take account of this trend.

Let me summarise briefly the reasons why governance needs to change.

Why do we need a change?

  • Rapid change & complexity mean that 'one-size-fits-all' will no longer work in a 'Patchwork Nation'
  • Departmental service silos dominate thinking, so no holistic view or coordinated action is possible
  • Governance is too focused on servicing, not resourcing and capacity-building
  • Structures work against whole-of-government and place management for diverse & complex areas
  • Need for power shifts in decision-making - re-build democracy and civil society

 Globalisation

  • flexibility & adaptability vital to manage complexity
  • competition is less between nations than between regions
  • local & regional grow stronger in parallel to global
  • top-down, one-size-fits-all, central planning and service delivery become obsolete
  • turbo-capitalism can disinvest anywhere, so risk-management & creative destruction are unavoidable
  • knowledge skills base is essential/ life-long learning
  • globalisation drives individualism & democracy, undermines authority and hierarchy
  • dangers of new tribalism, so governments are still essential to set priorities
  • but we need new partnerships and a devolved regional framework
  • need governance more directly accountable to the public
  • Public service culture needs to be outward- , not inward-looking

 It is not just Australia that has these needs. In the European Union, the USA and United Kingdom, there is growing attention to disparities between regions and the need for new forms of governance to help all regions develop and survive. The EU Structural Funds are targeted at developing necessary infrastructure, such as transport, energy and communication, modernising training systems, linking economic and social development, and disseminating the tools of the Information society. They are doing this through the decentralisation of policy-making, increased funding at the local level, empowerment at the regional level to promote a thicker form of democratic engagement, and the establishment of new quasi-governmental bodies and private-public sector partnerships. The UK now has elected Regional Assemblies to plan and link up community services. California has enshrined 'regional stewardship' in the form of multiple public-private partnerships, academic-business networks to stimulate innovation, and the formation of specific local level agencies to develop and implement public policies.

The evidence of success in these new learning regions is mixed, but highlights the importance of new approaches to governance. It is quite clear that social networks, the relationships within groups and between institutions that we call social capital, are crucial to change and innovation, and that such networks can be strengthened through better local and regional involvement with the

  • use of resources, training and use of expertise, direct policy-making power, local area visions and objectives, and coordination between governments, business and educational institutions

Moreover, the evidence indicates the importance of at least three areas of governance that we may need to focus on:

  • education and training
  • child and family support services
  • environmental protection and sustainability

The first is important because of the need for a strong learning base. The second is important because it determines the 'attractiveness' of a region to both young and old, and especially to those with young families, likely to be the most stable and highly motivated workers of all. And the third is important because it is mainly at the regional level that environmental concerns can be articulated and managed, witness Land Care and its heavy involvement of local communities.

Let me suggest a model of governance that would incorporate at least these three area of interest for the creation of learning regions. It would require the decentralisation of State government to better serve regional interests and a whole new culture in the public service.

New Public Sector - People- & Place-oriented

  • resourcing, not servicing
  • capacity-building, not central managerialism

 Premier & Cabinet, Treasury & Finance, Program Ministries, Regional Ministries & Resource Zones

  1. Premier & Cabinet
  • co-ordinate whole-of-government priorities
  • Demographic Unit(s) to identify diverse population groups and unique regional needs
  • Partnership Unit to stimulate new arrangements

 2. Treasury & Finance          

  • fund but not control
  • $ to both central & regional operations

3. Program Ministries

  • Program Ministers - respond to Govt. priorities and develop core program elements
  • would not control program delivery processes, but would be accountable for outcomes across the State
  • Health & Wellbeing/Human Services
  • Lifelong Learning & Employment
  • State & Community Development
  • Natural Environments
  • Safety & Justice

 4. Regions and Resource Zones

  • Assisting (?) Ministers, one per region (regions uniform across all Program Areas)
  • organisational headquarters in regions, plus staff
  • close links with all Local Governments/Resource Zones across region
  • Community Forums for public input on needs and existing resources (e.g. Regional Education Councils; Family Community Forums; Sustainable Development Agencies)
  • Analyse (with community input) gaps, needs, and design (with Area input) zone-appropriate programs & services
  • buy & construct programs/services (based on core priorities and local needs)
  • control most $ for programs & services

Even if such a model were not feasible, we need to develop new quasi-governmental institutions to enable greater involvement of people at the local and regional level.

On education, It turns out that universities in a region are less important than good secondary schooling, though they have a clear impact through locally-relevant research and offering locally-relevant courses of training. The reason why secondary schooling is the key is that general-level skills, and learning how to learn are crucial for implementing new workplace innovations and for the creation of new ideas. The OECD evidence is strong that a successful learning region has to forge clear links between local economic demand and the forms of education and training being offered to both young students and in-service training. As well, it highlights the significance of organisational learning within businesses, via mentoring, specific learning and training networks and more formal in-house training. Firms have to rethink what 'worked' in the past, make the best use of it, but also unlearn any dysfunctional practices they identify.  

Now what does this imply for governance as it relates to education and training?
In too many of our schools, VET is not seen as of equal value to university preparation courses, and vocational education programs, including short work-experience sessions, prove totally useless in teaching students anything about the real nature of work in a firm or region, or about the significance of on-the-job training, learning-by-doing, and learning-by-interaction - the two ingredients of organizational learning as opposed to individual human capital. As well, too many TAFE and university courses are offered in complete isolation from the real needs of firms in the region they serve. So what is needed is a more devolved, regionally-based approach to the curriculum and training programs in our schools and colleges. Though this frightens people concerned with equity and a national curriculum whose standards can be assessed, it is the only way to make education truly relevant to the needs of diverse regions, to illustrate the links between school and later life learning and to change the emphasis from a culture of academic irrelevance to one of learning by doing and interacting with others.

We could have Regional Education Councils as coordinating bodies for the design and practice of region-specific education programs in our secondary schools and colleges. In fact, senior secondary schools and TAFE Colleges would be better off united as Community Colleges, where adults and youth interact, vocational and more general education are integrated and business, educators and the wider community can discuss and be engaged in devising programs that best meet the learning needs of their own region.

The second area of governance that looms large in the literature on learning regions is that of child and family (human) services. The overall goal has to be to enhance the attractiveness of different regions in order to attract talent and those with an innovative, entrepreneurial drive. Much has been made in the media in recent days of the report's finding that the proportion of 'creative' people - bohemians, arts, music, gays, etc. - is in direct proportion to a region's innovative capacity. But you're not going to be able to attract the bohemians to every remote region of Australia. So instead, we should keep in mind the evidence of population drift in search of 'lifestyle'. Young people are pulled to the core metro regions (despite higher housing costs and debt), thus depleting the innovation base of country regions, because they want excitement and social contacts, let alone because they can't do the college courses they want in their own region. In contrast, older people are moving to the so-called 'lifestyle' regions, often because they can't get jobs in their own region and they want a better environment in which to live. Because many of the old are on benefits, this increases the lifestyle regions' dependency base, and they do not find a better lifestyle anyway because they have lost their social networks.

Governments cannot completely eradicate inequality, but better governance at the regional and local levels could certainly better meet the lifestyle needs of both young and old, enhancing the attractiveness of regions so they retain and attract creative human capital. Young families in particular are looking for a level of support not currently provided by government at any level. This is not just child care, it is aged care support, out-of-school hours support, youth services, recreation and the arts rather than just sports grounds, cafes and meeting places where they can mix informally, shopping centres, parks and gardens that are child-friendly, family-friendly in every way. Older people need much better help in living independently in their own homes, or at least in their own communities, and local plus state governments could do much better than they do at present to provide such support. As Richard Florida puts it, 'quality of place' depends on

Quality of place =

  • what's there? - the built and natural environment
  • who's there? - diverse people, creative capital
  • what's going on? - vibrancy of community life

The following is a model I have suggested for the better administration of human services at the regional level.

Regions & Family Resource Zones

(built variably round clusters of schools, child care centres,, local councils, health & other services - pooling community resources)

Govt. sets policy priorities, broad goals & accountability guidelines only;
local needs & suitable programs decided by

Family Community Forums

and delivered through

Family Resource Centres

(could be Primary Schools as Family Learning Centres, child care centres, local & regional libraries, linked by technology and staffed with Facilitators)

Schools act as vital inter-generational link points

Family Learning Centres - Primary Schools
Youth Education Hubs - Middle Schools
Community Colleges (Senior Schools/TAFE/adult & further education)

 To achieve such goals, governments at federal and State levels must fund local governments better, perhaps by means of block grants from GST funds. Regions themselves must learn to attract direct investment from domestic and foreign businesses and other agencies. New legislation such as the US Community Investment Act could stimulate this. But a central factor will be changing the culture of the public service, because it is at present riddled with an arrogant, we-know-best-what's-good-for-you attitude, and structures which restrict regional initiatives and community agency. Let me offer a set of new principles for the public sector which State and federal governments might consider:

Principles for a new public service culture

  • Good governance enhances democracy & civil society.
  • Public services should facilitate the re-building of community and a networked civil society.
  • Broad outcomes, not narrow inputs should be the focus of both policy & evaluation.
  • The goal is to resource communities & families, not just to service them.
  • Management is less important than supporting & facilitating innovative community-building processes.
  • Public finances are for community-building, value-adding to existing community resources.
  • Cost-effectiveness derives from flexible, locally-appropriate solutions; thus local control of and accountability for the use of public finances.
  • Departmental service silos & sections within them are not ends in themselves, but specialist advisers to and facilitators of community-building & life enhancement.
  • Policy should focus on desired outcomes, leaving program design & implementation to the diverse community patchwork of regions/resource areas.
  • Modern life is too complex for one-size-fits-all solutions - the key question is 'Where is the community?' in policy development & program implementation?
  • Risk is inevitable and to be welcomed - accountability & evaluation of processes/outcomes must therefore be looser & less restrictive of innovation.
  • Recruitment to the public sector needs to look for community-awareness & experience, innovative ideas, flexibility & trust in people, not managerial or administrative skills only; performance evaluation & promotion based on success in facilitating area-suitable programs.

The starting point is to assert that good governance is not about governing, or efficient management, of top-down control, but about enhancing democracy and re-building a civil society in which the goal is to resource communities and families, not to 'service' them.

Principles 5, 6 and 7 challenge some sacred cows of the public service - that only the experts know what is best for people, that only they can manage public funds efficiently and effectively and that management itself is the game, rather than value-adding, facilitating and resourcing self-managed communities who themselves control the design, implementation and funding of government programs. This forces you to rethink the focus on departments, separate silos across and within those departments and the current focus on inputs rather than broad outcomes implemented in many diverse and innovative ways by the diverse patchwork of communities that make up Australian society. Risk, creativity and, I believe, cost-effectiveness, lie in a new focus on community-building, in an end to one-size-fits-all, top-down services and solutions to social needs. 

Think about how such principles might operate within an alternative model of government such as the one I suggested above. I do not believe you can simply teach people a new set of principles, make value-statements, and expect anything to change. Instead I believe structure is all, and we need to reconceptualise how government departments and other structures might look if we are to have any hope of achieving a new public service culture. As Principle 12 suggests, recruitment to the public sector would have to be very different, because we would need imaginative, creative, adaptable people who trust others in the community to find solutions to their own problems. We would need new forms of training and re-training to achieve the sort of culture change I am suggesting is needed for the good governance in the global age.

To summarise, the reality is that globalisation makes regional development as significant as national strategies. The reality is that people will not respond to calls for change unless they have meaningful involvement in the planning and implementation of programs relevant to their own needs and interests; the reality is that without control of funds, talk of participation is a nonsense, so some of the State's purse strings have to be loosened. The reality is that education, lifelong learning and an attitude to learning which respects tacit knowledge, informal training, learning-by-doing and by interacting within an organisation are even more crucial to successful regional development than are formal qualifications. The reality is also that some forms of social capital, some regional and local networks, entrenched attitudes and values, what we call 'path dependency', are anathema to economic and social change; we will have to un-learn much if we are to survive. And the fact is that good governance can and should move in the direction of more local and regional responsibility and control of the use of what is, after all, the public's money.

References:

 Castells, M. (1996), The Rise of the Network Society, Oxford, Blackwell

Edgar, D. (2001), The Patchwork Nation, Harper Collins

National Economics/ALGA (2002), State of the Regions 2002

OECD (2001), Cities and Regions in the New Learning Economy, Education and Skills, OECD, Paris