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See also: Efficiency Improvement of Budgetary Funding of Public Institutions and man agement of state Unitary Enterprises, Volume I. Moscow.: IET, 2003; Chernets V.A., Chirikova A.E., Shishkin S.V., et all. Financial aspects of reforming social sphere (Scien tific papers 60). Moscow, IET, 2003.

Circus, 72.1 per cent in organizations engaged in maintenance and construction down to 10.5 per cent in public libraries.

Table Share of extra budgetary revenues in financing of federal institutions of culture and arts in Number of Average share of extra budgetary funding in Type of organization institutions* the overall volume of funding, in per cent Circus (Grand St. Petersburg 1 72.State Circus) Institutions engaged in mainte9 72.nance and construction Scientific organization 7 43.Theatre 29 42.Archive 17 30.Concert organization 27 18.Museum 57 16.Educational institution 70 11.Library 9 10.* Number of institutions, which provide data on extra budgetary revenues.

Source: Calculated from RF Ministry of Finance data.

1.4.3. Conclusions With the beginning of market type reforms in Russia budgetary insti tutions network in the sphere of culture and arts has undergone certain type on changes. This is true both to quantitative indicators of the net work and the level of attendance of different cultural institutions. The level of differentiation of Russian Regions by corresponding indicators of cultural development surpasses corresponding indicators of health care system. It should be noted, that major part of mass cultural institu tions are in local jurisdiction.

Beginning in 1992, federal budget funding of cultural sphere was contracting and growth of government expenditures in this sphere in real terms began in 1999 (1998 posted the lowest level of funding for the whole period from 1990). Major share of funds appropriated for cul ture and arts come from subfederal budgets. Federal budget appro priations constitute only one fifth of the public expenses amount in this sphere. Beginning in 2000 the federal budget expenditures are con stantly growing in this sphere. Major share of expenses are allocated for maintenance costs of institutions network in culture and arts.

The share of extra budgetary funds in the overall volume of revenues of cultural institutions is low. According to the data of the Ministry of Finance of Russia this indicator for federal institutions of culture and arts varied considerably for different types of institutions.

2. General Approaches to Reforming the Model of Social Service Delivery in Canada and Some Other Countries Possible ways of optimization of social service delivery represent special interest for the purposes of this paper. Search for new mecha nisms of public private partnerships in the sphere is very important.

Study of international experience (of Canada and some countries) in the sphere of alternative service delivery will be very fruitful.

This chapter defines alternative service delivery, standard meas ures are analyzed within alternative service delivery. Experience accu mulated by Canada and international community is generilazed in alter native service delivery.

Extensive Canadian and international experience with alternative service delivery at national (federal), provincial (state) and municipal levels of authority is analyzed by six possible alternative service delivery options: creation of specialized agencies, devolution, i.e. transfer of responsibilities of part of service delivery to other levels of authority or to the private sector, procurement of services in the private sector, creation of public private partnerships, franchising/lisencing and priva tization.

In addition, this chapter reviews efficiency and performance evalua tion techniques and summary analysis of some of these techniques is provided. Separate subsection is devoted to efficiency management methods at the institutional and individual levels.

2.1. Alternative service delivery What is alternative service delivery Alternative service delivery (ASD) means different things to different people. It is a uniquely Canadian term that has gained currency as a worldwide phenomenon. It has been popularized under many names and in many different forms in OECD countries and around the world.

Ford and Zussman define Alternative Service Delivery as:

" a creative and dynamic process of public sector restructuring that improves the delivery of services to clients by sharing governance functions with individuals, community groups and other government entities"44.

Alternative service delivery entails the pursuit of new and appropriate organizational forms and arrangements, including partnerships with other levels of government and non governmental sectors, in order to improve the delivery of programs and services. It is argued that innova tive organizational arrangements for delivering government programs and services can result in:

- More cost effective, responsive delivery to citizens;

- Changes in organizational culture and management practices so that the organization performs more effectively; and - The granting of greater authority to public sector managers, thus moving decision making closer to the point of delivery, to the com munities served and to citizens.

The Treasury Board of Canada defines alternative service delivery as the organizational and structural dimension of improving the govern ment's performance in delivering programs and services to citizens.

Alternative service delivery has two parts:

- Establishing the appropriate organizational forms within govern ment departments, outside traditional departmental structures or outside the public sector, to improve organizational performance;

and - Bringing together organizations from across government, between levels of governments, or across sectors, through partnerships (for example, "single windows," co locations, or clustering of services to citizens) to provide more seamless and citizen centred services.

Alternative service delivery is not one dimensional. It can include pri vatization, as well as reorganization and reengineering of mainstream government. It is not just about deficit reduction, devolution, and cen tral agency controls. It involves rethinking roles and functions of gov ernment organizations. It depends heavily for success on a strong pub lic policy foundation, a tradition of sound public administration, and on a citizen centred focus for public services. This government reinvention strategy has offered attractive models for governments, albeit with in herent risks and challenges.

Robin Ford and David Zussman. Alternative Service Delivery: Transcending Boundaries.

(Toronto: KPMG and IPAC, 1997), 6.

There has been extensive Canadian and international experience (especially, the United Kingdom, Australia, New Zealand, and the United States) with alternative service delivery arrangements at national (federal), provincial (state), and municipal (regional and local) levels of government. Rather than assessing these ASD arrangements by coun try where the particular policies, circumstances, and cultures of each government are likely to be a significant factor in determining the suc cess of the initiative, a more useful comparison is in terms of a contin uum of six ASD options: agencies, devolution, purchase of service, partnerships, franchising/licensing, and privatization.

A Framework for ASD The 1990s witnessed the emergence of a bewildering array of new types of service delivery mechanisms, some of which straddle the boundary between the public and private sectors. There is virtually no limit to the ingenuity of governments to invent new structural arrange ments. Four clusters are:

- Mainstream government (ministries, departments);

- Agencies (statutory, non statutory);

- Partnerships (other governments, contracts); and - Private entities (not for profit, for profit).

A typical array of alternative service delivery options used in a gov ernment setting is depicted in the figure below:

This diagram is reproduced, with minor modifications, from: Treas ury Board of Canada, Secretariat, "Framework for Alternative Program Delivery", 1995. An SOA is a special operating agency.

Fig. 8 arrays alternative service delivery along three important di mensions. The horizontal dimension in the framework is between the public and private sector and it illustrates the use of contracting out, partnering, and privatizing the delivery of public services. The vertical dimension deals with the question of the extent of government control and indicates how new approaches to service delivery do not necessar ily require that the government completely controls all aspects of the delivery of public services. Many aspects of service delivery can be controlled by a third party organization, such as a voluntary non profit organization that is outside of, and independent from, government. The third dimension, the oblique dimension, is the level of commercializa tion of the service and deals with the extent to which the organization makes a profit by selling it goods or services. Recently, in many coun tries more of the services that governments have traditionally provided for free, are now paid for by user fees (e.g., special weather reports, airport terminal taxes, certain medical tests, etc.) Fig. 8. Possibilities for Service Delivery Arrangements The Province of Ontario has taken a systematic approach to alterna tive service delivery and has established the following continuum of al ternative service delivery options:

- Direct Delivery: Government delivers the services directly through its ministries, through business planning, focusing on results, cost recovery, getting the best value for the tax dollar, and customer service.

- Agencies: Government delegates service delivery to a scheduled agency operating at arms length from the ongoing operations of government, but maintains control over the agency.

- Devolution: Government transfers the responsibility for delivering service to: a) other levels of government, b) profit or non profit or ganizations that receive transfer payments to deliver the service.

- Purchase of Service: Government purchases the services under contract from a private firm, but retains accountability for the ser vice. This includes contracting out and outsourcing of services.

- Partnerships: Government enters into formal agreement to provide services in partnership with other parties where each contributes resources and shares risks and rewards.

- Franchising/Licensing: For franchising, the government confers to a private firm the right or privilege to sell a product or service in ac cordance with prescribed terms and conditions. For licensing, the government grants a license to a private firm to sell a product or service that unlicensed firms are not allowed to sell.

- Privatization: Government sells its assets or its controlling interest in a service to a private sector company, but may protect public inter est through legislation and regulation.

These various options for alternative service delivery can be directly related to figure 1 and positioned along the three dimensions. For ex ample, devolution is positioned in the upper left quadrant and is associ ated with transferring a service delivery responsibility, which generally has a relatively low level of commercialization, from one government to another or from one government to a non profit organization. Purchase of service is positioned in the lower right quadrant and is associated with the government contracting with an independent private sector organization for a service that has a relatively high level of commerciali zation.

This framework is particularly useful for strategically positioning various options for alternative service delivery arrangements. But a considerably more in depth analysis of the specific characteristics of the actual service being delivered and the institutional underpinning is required in determining whether, when, and how the particular service might be better delivered through an alternative service delivery ar rangement. Without specific analysis of the actual service, ASD can be risky business. The unintended consequences can make things worse and create a backlash against other reforms. Poor financial discipline can damage the budget or encourage inefficient behaviour within the public service. New delivery mechanisms need to be more than just quick fixes.

There needs to be a threshold test to determine which specific ASD option, under what particular circumstances, might be a useful way to proceed. Policy makers and advisors require a conceptual framework and critical thinking process to determine the criteria and risks that must be satisfied to arrive at the best balanced choice. They need to assess the consequences of alternatives, to account for policy impera tives and political variables, and to anticipate managerial problems aris ing from the delivery option selected.

Six test questions are suggested. They are based on the framework for program review developed and implemented by the Government of Canada. Together or individually, they lend strategic focus in assessing specific options and in building ASD into government business plans.

ASD Framework Test Questions Strategic Focus Question Public Interest Test Does the program or service continue to serve a public interest Role of Government Is there a legitimate and necessary role for government in this program or Test service Jurisdictional Align- Is the lead responsibility for this program or service assigned to the right ment Test government jurisdiction External Partnership Could, or should, this program or service be provided in whole or in part by Test the private or voluntary sector Business Principles If the program or service continues within the existing government context, Test how could its efficiency and effectiveness be improved Affordability Test Is the program or service affordable within fiscal realities These test questions are used to narrow the range of acceptable al ternatives when applied in association with the decision tree45 below (fig. 9):

Fig. 9. Alternative service delivery framework While ASD is not a panacea, it does help in seeing the forest for the trees, as new shapes appear through the swirling mists. Ford and Zussman elaborate:

See The World Bank Group. Administrative and Civil Service Reform: Alternative Service Delivery Mechanisms.

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