the state sector. In many continental European countries health and education are
services provided by the independent sector, but in the UK these services remain
predominantly in the state sector. Along with the armed forces, the only part of the
public sector which all countries share is central government administration, i.e.
the core civil service which accounts for much comparative research (Pollitt and
Bouckaert 2004 ). In addition, the relative neglect of the public sector stems from its
operating according to distinctive principles and its use of employment practices
that have not been viewed as especially innovative.
This analytical gap is regrettable given the size and signiWcance of the public sector
workforce. While there are variations between countries, state employees rarely
constitute less than 12 percent of the workforce and, in Scandinavia, as much as
a quarter or even a third (Pollitt and Bouckaert 2004 : 113 ). Individual organizations
in the UK such as the National Health Service (NHS), employ more than 1. 3 million
employees,Wve times larger than the UK’s largest corporate employer, the retailer
Tesco. Moreover, services that include health, education, social welfare, and defence
are vital to individual well-being and societal competitiveness. The public sector in
the majority of developed countries also has been at the center of a continuous
programme of politically sensitive reform (Pollitt and Bouckaert 2004 ) with major
HR implications. As a labour intensive sector the nature and outcome of any change
program is inevitably dependent on how staVrespond to reform initiatives.
This reform programme has typically been labeled and underpinned by a New
Public Management (NPM) approach. The primary purpose of this chapter is to
explore the impact of NPM on the management of human resources in the public
sector. NPM corresponds to a period of public service reform which swept through
many countries during the 1980 s and 1990 s. This observation generates supplemen-
tary questions. TheWrst is whether there are aspects of organizational life in the
public sector which combine to produce an enduring and distinctive form of HR
practice under any organizational or managerial regime. The second is what form
did the management of HR take before public policy attempts to pursue a NPM
approach? The third relates to whether we are now entering a post-NPM era of
public service reform. If this is the case, what does it mean for people management?
These questions provide the structure for the chapter. The argument presented is
straightforward: enduring features of the public sector lend the conduct of HRM
a distinctive form, but shifts in the prevailing organizational logic from hierarchy
through markets to networks have had important implications for people
management in terms of prescription, policy, and practice.
23.2 The Context
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Many of the characteristics of public service employment derive from the unique
role of the state as employer. The degree of public scrutiny and the amount of direct
470 stephen bach and ian kessler