As to how a government can go about budgeting for outcomes and make it work, they advocate separating "steering" from "rowing":
Politicians love to merge organizations, because it looks like they're taking action to save money. But simply moving boxes on an organizational chart can actually make matters worse, increasing costs while sowing confusion that hampers performance. A much more powerful alternative is to consolidate funding streams and policy authority into "steering" organizations that can purchase results from any "rowing" organizationsmore:
--public or private --that can best produce them.
Budgeting for Outcomes by David Osborne and Peter Hutchinson
"... focus on steering, not rowing – making policy and setting direction rather than producing services" (Osborne 1999)
separating steering from rowing in public schools
Osborne and Hutchinson:
Consider public education. A school board is a steering organization, but in the consolidated model we developed in the twentieth century, the board and district own virtually all the schools and employ virtually all the employees, from teachers and aides to custodians and bus drivers. The same organization--the school district--is responsible for both steering and rowing.
We have already discussed some of the problems this creates. Employees with a vested interest have the power to block changes that could help children. With all their employment contracts, regulations, sunk costs, and infrastructure, districts find it impossible to change their offerings fast enough to keep up with what their customers want and need. And those who should steer--board members and superintendents--find their energies sucked into the job of employing people and managing buildings, rather than ensuring student achievement.
A new survey of 100 public school superintendents in large urban districts illustrates these problems. Most of these superintendents, it reports, feel "the job is well-nigh impossible." Their role as employers continually overwhelms their role as purchasers of results. In large cities, school districts are among the largest employers, and as the report makes clear:
Control of the jobs is highly coveted and is never ceded lightly; the jobs themselves become central battle grounds for unions, community groups, and local politicians. No politician can afford to ignore them. And very few do. . . pressures for districts to respond to adults' financial demands rather than the children's education needs [are] a frustrating reality for many superintendents.
One superintendent was even more candid:
The real problem is that the district is a big pot of money over which adults in and out of the system fight to advance their own interests and careers. Better jobs, higher status, bigger contracts, and career advancement are what's at stake. All the public talk about teaching and learning has to be understood as secondary to that economic dynamic.
Does it have to be this way? Of course not. In the late 1990s, the Education Commission of the States--made up of governors, state legislators, state superintendents of education, and other education leaders--created a National Commission on Governing America's Schools. Its members studied the governance system of public education and issued a report recommending that states and districts make big changes in the consolidated model. The first option proposed was to introduce full public school choice, decentralization, and competition, within the consolidated paradigm. But the second was a more radical break. It said, in essence, that those in charge of education should separate steering and rowing. School boards should stop being owners and operators of schools and become purchasers of education programs on behalf of the communities they served. The board should grant charters -- five-year performance contracts to independent groups (teachers, colleges and universities, nonprofits, businesses, community organizations) to operate schools. The commission said, in effect, that every public school should become a charter school.
If this were done, the commission pointed out, school boards could close down schools in which students were not learning, replace them with schools more tailored to the needs of those students, and quickly contract for innovative new schools that embraced technology, used particular learning methods (from Montessori to computer-based learning), and/or offered specific content themes, from performing arts to math and science to community service. When the board closed a school, it would not face the united opposition of every teacher, aide, clerk, and principal; indeed, competitors would line up eagerly to replace it. The board would no longer be a political captive of its employees because it would have so few; schools would be the primary employers.
Teachers in every public school would know that their jobs were safe only as long as students were making academic progress and parents were satisfied. The door to innovation would suddenly swing open, and the size, shape, and pedagogical methods of public schools would change rapidly.
Many superintendents appear intrigued by the idea. In the survey of superintendents of large urban districts, two-thirds agreed that the "district should be able to charter all schools or enter into contracts with schools governed by accountability for education results."
Even more surprising, some districts are already moving in this direction.
Barnstable, Massachusetts, has begun to convert each of its public schools to charter status. In California, three small districts have already done the same. San Carlos made six of its seven public schools charters. The Hickman Community Charter District has only three schools, but all are charters. And the Twin Ridges Elementary School District has two traditional schools and two charter schools within its boundaries, but has sponsored ten charter schools outside its boundaries.
The Price of Government: Getting the Results We Need in an of Permanent Fiscal Crisis by David Osborne and Peter Hutchinson
p. 128 - 130
Sounds good to me.
I think this is the way services for developmentally disabled adults are funded here in New York. More anon.