Public Administration and Private Enterprise – Co-operation, Competition and Regulation
General Rapporteur: Luiz Carlos Bresser-Pereira
Economic development, social justice and democracy are major political objectives of modern societies which strongly depend on a healthy relationship with the state, with its institutions and public administration, and the private enterprises. Business enterprises are directly responsible for economic growth in so far as they make the investment decisions and carry on technological change and innovation in the market. Yet, the national states and their respective public administrations have major roles to play in the development process and in creating the appropriate conditions for private enterprises to flourish.
In the last 20 years, a misguided debate took place on the role of the state and of private enterprises. From one side we had the defenders of markets, on the other, of the state, when only a state endowed of government capacity is able to guarantee a strong and competitive market. The state is not supposed to produce goods and services to the market, but to regulate the market and all other social and political activities. We need a capable state, endowed of politicians and senior civil servants, who are able to take the main political decisions, to create or reform relatively permanent institutions, and to define the temporary public policies with competence; an effective public administration, able to enforce the law; and an efficient public management, able to provide the basic social and scientific services that society understands that should be principally financed by taxes.
In relation to the private enterprises, the basic objective is to create an enabling environment which stimulates entrepreneurship and investment. An extreme liberal view asserts that this environment will be achieved just by public administration costing less, only the essential for the guarantee of property rights and contracts. Yet, this is not what the experience of the more successful countries demonstrates.
Classical liberal philosophers defined the state as the outcome of an implicit social contract. A contract between the rulers and the ruled. At their time, the rulers were the aristocrats, and the ruled, the people. With the rise of the bourgeoisie, socialists understood that the private enterprises were the rulers, and the workers, the ruled, but with the rise and consolidation of democracy, that view lost substance. In democratic regimes, the rulers are the politicians and the senior civil servants in public administration, and the ruled are not only the workers but also the managers and the business enterprises. Thus, a valid social contract must involve the three ‘groups': elected and non-elected government officers (government and public administration), business men (private enterprise), and the people (workers and professional middle class).
That is why modern democratic nations have institutions that not only protect property rights and contracts, but also the poor and the middle class. In doing so, they legitimize their social contract: they assure to the respective governments the political legitimacy which is essential for political stability and economic growth. When they assure law and order, a first duty, they are directly responding to private enterprises; when they assure social rights and the welfare state, a second, they do that directly.
Thirdly, besides assuring the institutional and welfare infrastructure that modern nations require, the state and its public administration are supposed to provide or regulate the physical infrastructure for the whole system; and a fourth duty now is to cooperate with private enterprise in promoting technological progress and national competitiveness.
Thus, modern public administration plays a strategic role. And a difficult role, because, besides doing its job effectively, it must do it efficiently, at low cost, so that the tax burden is not too high. Public management reform arose essentially from this double constraint. On one hand public administration must perform at least the three ‘expensive' roles referred above. Or, in other words, taking again private enterprises as the reference, it must assure the general conditions for investment – through institutions assuring law and order, and social and cultural well being, and through an adequate economic infrastructure. On the other hand, it must do all that efficiently, at the least cost.
Public administration has been adopting several strategies to meet these challenges. Outsourcing ‘common' services of all kinds to business enterprises and contracting out public non-state organizations to provide social and scientific services, like education and health care, has been a major option. On the other hand, in order to make more efficient its own operations, the state has been reducing the role of classical bureaucratic controls (strict regulation, supervision and auditing), and increasing the role of new ones, particularly management by contracted outcomes, administered competition for excellence, and social accountability mechanisms.
From this general framework, follow a series of questions that should be given attention in the papers submitted to the IIAS Berlin Conference 2005 and you will find at this homepage on the subtopics. They are the following:
 | Subtopic 1: Co-operation and Partnership of Public Administration and Private Enterprise: Economic Chances, Constitutional and Political Objections?
| | Subtopic 2: Regulation: the Concept and its Enforcement. Experiences Made by Regulatory Agencies in Different States
| | Subtopic 3: Competition, Co-operation and Conflict in the Field of Public Services
| | Subtopic 4: Regulatory Powers of National Governments in a Globalized Economy |
Different Panel discussions will add the Conference Program. In 2005 we focus on: | United Nations Panel: State Activities and Privatisation from the Perspective of Developing Countries
| | Global Governance Panel: Administering Global Governance
| | German Panel: Administrative Reform and the Reduction of Bureaucracy: An Ongoing Challenge for Public Administration and Private Enterprise
| | North-American Panel: Contracting and Outsourcing Public Services in the U.S.
| | Asia Pacific Panel: Contracting-outs in Local Governments: Outcomes,
Limits and Challenges
| | Panel of the UN & IASIA Task Force on Standards of Excellence in Public Administration Education and Training
| | IIAS Panel: Celebrating the 75th Anniversary of the International Institute of Administrative Sciences (1930 – 2005): History and Culture of Public Administration |
* For information about the profile of the Brazilian academic Mr. Bresser-Pereira, please click here.
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