Potentials for Savings and Efficiency Enhancement in Public Administration. Results of an International Benchmarking Analysis
The standard exercise of conjecturing the savings potentials in public administration draws on a general notion that Austria's bureaucracy is "too big" and/or "too expensive". Against the background of a perennial discussion of administrative reform we compare the cost of public administration in Austria with administrative expenditures in other EU and OECD countries. Irrespective of the chosen definition of public administration cost, Austria almost always ranks at an average position in international comparisons. An international assessment in the "General Public Affairs" category yields high potential savings. Taking into account a small country's natural disadvantages in realising economies of scale in general public administration, we infer potential efficiency gains of € 750 million to 2.5 billion in Austria. For the calculations it is assumed that the quality and quantity of administrative services do not differ internationally. Moreover, comparative analyses of administrative performance and efficiency point at similar efficiency reserves in general public administration. Our estimates also lead to the conclusion that a reduction of the complexity of regulation rules and administrative procedures can produce further cost savings of € 500 million.
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