NEW PUBLIC MANAGEMENT

The ideology of the New Public Management (NPM) was promoted even after
the premiership of Tun Dr. Mahathir as the fourth Prime Minister during 1981.
According Drechsler (2005), this ideology also focused on the changes in
administrative policy and financial management with the adoption of the
private sector best practice. This is because during 1970s, there was
encountered problematic performance on the public agencies which lead to
transformation of the public management in Malaysia. Most of the public
enterprises were affected by severe recession during the middle of the
1980s.
Other than that, the government faced the fiscal deficits which push to
the transforming of NPM. In addition, the fiscal deficit that encounter by the
government affected the public sector. This is because during the recession
period, the withdrawal of the public sector meant that the role of the public
sector itself also changed. The changes been made as the public actor who
act as a key agent of development transform to be an assist to the private
sector since the privatization policy was enacted by Tun Dr. Mahathir.
The implementation of NPM also leads to two crucial policies which is
Dasar Pandang ke Timur on 1982 and the Malaysian Incorporated and
Privatization Policy on 1983. According to Noruddin (1999), both of these
policies were acted as the catalyst for the transformation of the role, function
and scope of the public sector. This is because, these policies were
implemented due to the period of recession and it also characterized by the
worldwide international trend. Moreover, the international trend is more
focusing to the privatization of the public service.
As Malaysia is going to become the well-developed country by 2020,
Malaysian government had accepted the philosophy of NPM. The philosophy
of NPM has its own purpose of improving their organizational efficiency,
effectiveness and accountability in the provision of services (Joseph, et

al.,2014). Under this new implementation according to A.Hamid (1995), the

civil service operates in an era where the customer is paramount. Other than
that, the civil service sought to address such inefficiency and ineffectiveness
through administrative reform and reorganization (Tooley, Hooks and Basnan,
2009). Therefore, with the implementation of NPM, the government believe
that expanding the role of the private sector will improve the efficiency and
effectiveness of public service.
One

of

the

related

agencies

that

been

established

after

the

transformation of NPM is Malaysian Administrative Modernization and

Management Planning Unit (MAMPU). This central agency was under Prime
Minister Office (PMO). The establishment of MAMPU was based on a report
entitled Development Administration in Malaysia and it acknowledged the
need to upgrade the field of professionalism in the public service. In line with
the rapid and dynamic growth of the public service, the role of administrative
modernization and human resource planning was then handed over to
MAMPU. They are act as the management consultant by the government.
MAMPU was then tasked to improve the quality efficiency, and effectiveness
of public administration.
MAMPUs roles are acting as a catalyst and change agent in
administrative and management services in the public service. This is
because MAMPU acting to transform the public service. They also a facilitator
in the implementation of modernization and transformation programs in the
public service delivery system. Moreover, they also act as a researcher in
administrative modernization and management planning for the public
sector and a promoter of government services to the public.
Moreover, various government agencies and units were established to
facilitate the reform and help the public sector manage the changes of their
scope and function. Among those agencies, MAMPU also role in identifying
major issues and suggest recommendations to overcome problems of public

administration. (Abdul Karim, 1995; Abdullah Sanusi, 1997; Trezzini, 2001).

Other than that, the reformation in public sector took a twist starting from
the early 1980s which resulted in the transformation of role of the Malaysian
public sector.
MAMPU also acted as the agency that responsible for administrative
development and also involved in coordinating the implementation of Key
Performance Indicators (KPI). The use of KPI is to improve service delivery.
According to Hood (1995), this is because with the belief in the superiority of
the private sector practices, it is not surprising that the fundamental concept
of NPM is the conviction that the public sector should utilize the practices of
the private sector. The purpose for introducing and implementing KPIs in
public organizations is similar to the way Performance Planning Budgeting
and Modified Budgeting System were carried out.

KPIs were implemented in several pilot sites prior to it being introduced

to all public agencies. MAMPU had carried out the pilot project of KPIs with
an initial implementation in six government organizations. Those selected
organizations were a state hospital, national registration department,
municipal council, police unit, immigration department and land office.
Other than that, this is also true in Malaysia which has accepted the
philosophy of NPM since the 1980s. Continuing the effort made under the
previous administration, the new administration embarked on instilling a
performance based culture in civil servants through introducing a system of
KPIs for public agencies. The system of KPIs had been established for
government linked-companies (GLCs). However, the KPI system does not
represent a revolutionary change since assessing the performance and
accountability of the public sector is new in Malaysia.

The use of KPIs may lead to increase in accountability of the agencies

and also its officers. Since the government does not monitor the
performance of public agencies, it seemed that there will not be any
penalties for noncompliance or for not attaining the performance targets.
Thus, whether and how KPIs are to be implemented in various agencies
depends on the head of the agencies themselves. Nevertheless, the use of
KPIs may lead to increase in accountability of the agencies and also its
officers. The KPI data provide visibility and transparency of the individuals
and agencies, performance.
The head of the two organizations of the pilot sites did not use the KPI
data to penalize their staff. However, in both organizations, the data from the
KPI system provided information regarding the individual output and the
responsibility of their officers in the process of service delivery. Such data
were used in the two organizations to improve their service delivery in terms
of faster time to provide service. It was also used as a basis for a better
allocation of human resources in those organizations.
Those are the initiatives that been made by the transformation of the
new public management as the KPI is one of the approach that could govern
the public management in Malaysia.

REFERENCES
A. Hamid, AS 1995, Government in transition: building a culture of successthe Malaysian experience. Public Administration and Development. 15(3) pp.
267-269.

Drechsler, W 2005, The re-emergence of weberian public administration

after the fall of new public management: the central and eastern european
perspective. Halduskultuur, 6, pp. 94-108.
Hood, C. (1995). The new public management in the 1980s: Variations on a
theme. Accounting, Organisation, and Society, 20(2/3), 93-109.
Joseph, C, Pilcher, R and Taplin, R 2014, Malaysian local government internet
sustainability reporting. Pacific Accounting Review. 26(), pp. 75-93.
Noruddin, K. (1999). Privatisation. In M. A. Abdul Karim, (Ed.). Reengineering
the public service: Leadership and change in an electronic age, Selangor:
Pelanduk Publications, 293-316.
Tooley, S, Hooks, J and Basnan, N 2009, Stakeholderss perceptions on the
accountability of Malaysian Local Authorities. Advances in Public Interest
Accounting.