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Choosing the Right FABRIC:A Framework for Performance

Information in Government

ALEX HILLBetter Public Services team

2Government Balanced Scorecard Practitioners ForumPresentation by Alex Hill, HM Treasury

What I’ll cover…• Performance in context• Characteristics of a good performance

information system• What makes a good performance

measure?• Cascading performance planning• PSAs and targets• Q & A


1. Performance in context


Public Spending Framework - aim

What should a public spending framework deliver?

To improve the quality and cost-effectiveness of public services whilst

maintaining sound public finances.


The public spending framework

Move to resource based accounting and budgeting

Introduction of 3 year plansSeparate budget for capital spendingProper asset managementUnderpinned by outcome focused

performance targets


Why measure performance?What gets measured gets doneIf you don’t measure results you can’t tell

success from failureIf you can’t see success you can’t reward itIf you can’t reward success you’re probably

rewarding failureIf you can’t see success you can’t learn from itIf you can’t recognise failure, you can’t correct itIf you can demonstrate results, you can win

public support ‘Reinventing Government’ – Osborne and Gaebler


Why is performanceinformation important?Good performance information:• Indicates how well an organisation is

performing against aims/objectives• Helps identify which policies and

processes work – and why they work• Improves Government performance• Enhances public accountability


Inputs, outputs, outcomesINPUTS:Resources that contribute to delivery such as labour

and physical assets

OUTPUTS: Final goods and services produced for delivery to the

consumer

OUTCOMES: Impact or consequences of these activities for the

community


Inputs, outputs, outcomes

Economy Efficiency Effectiveness

VALUE FOR MONEY

OTHER EXTERNALINFLUENCES

RESOURCES (£) INPUTS OUTPUTS OUTCOMES


Inputs, outputs, outcomesOTHER EXTERNAL

INFLUENCES

LIFESTYLE CHOICES,HOUSING, POVERTY

RESOURCES (£)

DEPT OF HEALTHSPENDING REVIEW

SETTLEMENT

INPUTS

DOCTORS/NURSES, HOSPITAL

EQUIPMENT

OUTPUTS

OPERATIONS,CONSULTATIONS(OF QUALITY)

OUTCOMES

LONGER LIFEEXPECTANCY,

BETTER HEALTH


2. Characteristics of a good performance information system


FABRIC

FocusedAppropriateBalancedRobustIntegratedCost effective


FABRIC

Focused on the organisation’s aims and objectives

Appropriate to, and useful for, stakeholders

Balanced, giving a picture of what the organisation is doing, covering all significant areas of work


FABRICRobust in order to withstand

organisational/individual changesIntegrated into the organisation; part

of business planning and management processes

Cost effective, balancing the benefits of the information against the costs


3. What makes a good performance measure?


Criteria of a good performance measure

5. Timely, with data to track progress available quickly enough to use6. Reliable, accurate, responsive to change7. Comparable over time or between units8. Verifiable, with clear documentation

1. Relevant to the organisation’s aims2. Avoids perverse incentives and waste3. Attributable, and open to influence by the organisation4. Well-defined, with consistent data


SMART targets are…Specific – avoiding vague targets which might

lead to uncertaintyMeasurable – underpinned by a sensible and

reliable quantitative data sourceAchievable – whilst at the same time setting a

stretch, or step-change in performanceRelevant – to what the organisation is trying to

achieveTimed – with a clear end date, and supported

by timely data


4. Cascading performance planning


Business planningAim: Translate high-level objectives into

management action and linked performance measures

So:- should take place throughout the

organisation- should inform management decisions


INDIVIDUAL STAFF PERFORMANCE AND ACCOUNTABILITY PLANSStaff performance development and performance appraisal

BUSINESS GROUP PLANSEg Internal plans (including delivery plans)

and performance measures/standards

ORGANISATIONAL STRATEGYEg Business plans for government departments and agencies

MORE DETAILED AIMS & OBJECTIVESEg Best Value Performance Plans,

Agency targets

Cascading planning in the public sector

STRATEGIC PRIORITIESEg PSAs, Local PSAs


5. PSAs and targets


Why set targets?• a clear statement of what government

is trying to achieve• a clear sense of direction• a focus on delivering results• a basis for monitoring what is and isn’t

working• better public accountability


Choose the right targets

Not too many…SMARTReal measures of success…Which are owned by deliverers


What is a PSA?Public Service Agreements:• “explain what departments plan to deliver in

return for…significant extra investment”• “[set out] demanding national targets”• “[reflect] the Government’s key priorities and

[focus] on the outcomes that matter most to the public”

• “represent an agreement between the Government and the public”


Structure of PSAsAIM: A high level statement of the role of the

departmentOBJECTIVES: in broad terms, what the department

is looking to achievePERFORMANCE TARGETS: under most

objectives, outcome focused targetsVALUE FOR MONEY: each department is required

to have a target for improving the efficiency or value for money of a key element of its work

A statement of WHO IS RESPONSIBLE for the delivery of these targets.


Public Service Agreement targets

Examples• DH: reduction in death rate from heart

disease among under 75s by 40% by 2010• CJS: cut domestic burglary by 25% on 1998-

99 levels by 2005• MOD: By 2006, ensure that a minimum of

90% of high readiness forces are at their required states with no critical weaknesses


2002 Spending Review•Total Managed Expenditure £517billion in 2005/06•Around 40% of GDP•130 targets in PSAs•Average of less than 7 per department•Mostly about outcomes


Going forward for SR2004

• Key focus on continuity to ensure delivery of existing objectives

• Increased focus on devolved decision making• No significant changes to the framework,

exceptLower level targets/processes abolished to enhance focus on key PSA outcomes

• Continued focus on measurement issues


Public Service Performance -Principles

1. Clear long-term strategic goals2. Independent audit and inspection3. Maximum local flexibility and

discretion to innovate4. Transparency about what is being

achieved

ANY QUESTIONS

?ALEX HILL

Better Public Services team


OTHER USEFULLINKS AND DOCUMENTS

PSA PERFORMANCE WEBSITE:http://www.hm-treasury.gov.uk/performance/

KEY PERFORMANCE DOCUMENTS:http://www.hm-treasury.gov.uk/performancedocs

RECONCILIATION OF TARGETS FROM SR00 to SR02

http://www.hm-treasury.gov.uk/Spending_Review/spend_sr02/psa/spend_sr02psatargets.cfm


www.hm-treasury.gov.uk/fabric


OGC successful delivery toolkit and pocketbook

www.ogc.gov.uk/sdtoolkit/ andwww.ogc.gov.uk/sdtoolkit/keyissues/delivery/pocketbook

.html


www.ogc.gov.uk/sdtoolkit/keyissues/getting/index.htm


www.hm-treasury.gov.uk/agencytargets


www.cabinet-office.gov.uk/civilservice/publications/Yds.pdf

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