The public sector, though not driven by revenues and profits, has more need for performance measurement than any private entity. Starting from the performance of individual employees, it has to measure the performance of units, departments, entire organisations, ministries and the total government. It has to measure the outputs and outcomes of each project and initiative, entire program and finally overall strategy and policy of a given area. It has to measure its developmental activities alongside its recurring operations with vastly different sets of targets and expected outcomes – social, economic and environmental. The scope and depth of areas that the public sector covers requires performance measures that are far superior to the existing measures comprising standard numbers and ratios.

These measures must also respond to the other complexities and challenges involving public services, namely the management of public perception and sentiment, resource allocation decisions, attraction and retention of talent in the public service, delivery of efficiency and effectiveness goals and the management of social costs.

With increasing levels of awareness and availability of alternative media, public will judge public sector initiatives by the long term outcomes they achieve. Regardless of expenditure targets met – that is how much the government spends on public initiatives- each and every person will judge these initiatives by the long term outcomes they deliver – example, employment, housing affordability, quality of schools and healthcare. It is very important that performance of each initiative is clearly aligned and steered towards achieving the expected socio-economic outcomes.

Public spending that is developmental of nature presents a classic economic dilemma, that is the public allocation decision. Fair and efficient capital allocation decisions can be made only if each dollar spent can be tagged to the eventual returns it delivers - in terms of its contribution to the various socio-economic sectors - using reliable and effective measurement methodologies.

Public service requires employee performance management structure that is able to attract and retain top talents in areas which depend on crucial expertise and knowhow. Reward schemes must therefore be aligned to the organisational goals, based on the employee’s nature of work, competencies, deliverables and desired outcomes while taking into consideration the management, cultural and team set-up within the organisation. The performance objectives assigned must be able to promote a culture of excellence while building internal capacity and capabilities.

Operational areas – healthcare, security, education, immigration, police and transportation, to name a few – require performance measures that will ensure that competitiveness, efficiency and quality of service is maintained at all times. These areas require comprehensive measures that capture not only daily outputs, but their cost-efficiency, quality and long term service improvements.

The emerging environmental and life quality awareness will create implications on the way the government measures progress. Social costs must be imputed into current tax schemes so that private activities confirm to the principles of sustainable growth. This will require more and more complex output and outcome measures to be employed across many policy areas.

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