How overstretched is government spending? Are there sufficient revenues to pay the cost of the services the community requires? We are told debt payments are secure but what about day-to-day bills for text books, hospital medicine and supplies, meals for the elderly and home bound, subsidy payments for foster children and homeless services, and effective garbage removal and disposal?
In 2015 our local government spent approximately $15,000 per person. Total territorial government spending was $1.5 billion dollars for 105,000 persons. That spending was the equivalent of 42% of our Gross Territorial Product, the value of all finished goods and services produced locally. The national average among the fifty states is estimated at 19% for 2017. The smaller states of Rhode Island, Hawaii and Wyoming will spend 21%, 22%, and 24% respectively.
The previous figures suggest revenue sufficiency is not the problem. Spending is.
New revenues in the absence of a concerted effort to reduce spending will not change the existing paradigm. New revenues will provide more dollars for spending. It will not bring about smarter spending. The way forward requires a concerted focus on rightsizing government operations.
What then is rightsizing?
William Eggers of The Allegheny Institute for Public Policy describes rightsizing as answering the question, if we started afresh how is each government service delivered most cost effectively. It urges government leadership, with community input and in the context of a strategic vision, to streamline government operations and eliminate redundancy, waste and inefficiency. It consolidates activities and government units and it deploys technology and innovation to reduce operating cost. Rightsizing focuses first on delivering core services effectively and allocates funding on the basis of what is done rather than how much it cost in the past to deliver services. Where advantageous, it introduces competition and privatization to deliver appropriate services.
Rightsizing removes unnecessary layers of administrative support that separate management from those providing services. It restructures how the government workforce is deployed, introduces flexibility in job assignments and rewards employee performance for innovation and excellence.
St. Thomas, St. John, Water Island and St. Croix are unique communities. Rightsizing moves away from duplicating facilities and services simply because that is what has been done in the past.
Examples of how things might be done differently to reduce operating cost include:
- The expanded use of video conferencing to reduce travel between islands or between offices as well as to expand training opportunities.
- Consolidating support services.
- The use of a car-sharing concept to reduce vehicle fleet requirements.
- The outsourcing of printing and replication services.
- The expanded use of digital communication, imaging and cloud storage to reduce filing, storage and messenger service cost.
- A long time fix for roadside brush control to eliminate repetitive bush cutting.
- Expanding the use of contractual services to create new private sector entrepreneurial opportunities and increase tax revenues.
- Negotiating work-rule changes to allow greater flexibility in job descriptions and the use of manpower resources.
Operating outside of the box allows government to implement practices that enhance service delivery, empower its workforce, expand and grow the private sector, increase tax revenue, reduce the cost of government operations and invest in economic growth and job creation.
Arguing for rightsizing is not criticizing the government work force. In an environment of reduced financial resources what we now must do is to align our providing of government services with what is affordable.
Many within government know what needs to be done. That knowledge is invaluable. Those outside of government bring a fresh perspective and different skills to helping in the rightsizing effort. They can share transferable practices that contribute to productive solutions. Working together the community can get this done without a third party telling us how to do so.
Rightsizing will produce workforce dislocation. As such, it requires a community-wide conversation around what is needed, what is affordable and what is not. Dislocation, when it occurs, can be mitigated. Rightsizing requires thoughtful and phased implementation and a community-wide commitment to working together.
The territorial government’s workforce employs 26% of all non-agriculture workers.
Restructuring government, which employs 1/4 of the territory’s workforce requires community wide involvement to make this successful.
The commercial sector also has a role to play by paying its fair share of the cost of government services and expanding employment opportunities, where possible, to absorb displaced government workers. New government contracting and purchasing will expand the opportunities for business growth.
Absent a willingness to make difficult choices, nothing will change. All government services will be equally depreciated. Health services will lose access to funding even up with the sponsorship of social and cultural events; education and training will continue to miss the mark in preparing members of the community to be competitive; infrastructure and economic investment will remain beyond reach; government workers will continue to be compensated below that appropriate for the service they provide; and retirees will continue to face an uncertain financial future.
There is no alternative fix. We did not get to where we are overnight and any solution requires community patience and shared sacrifice. The long-term benefit is far more desirable than what is now foreseeable. Accomplishing this requires centering decision-making on what is best for the community as a whole.
Collectively we can accomplish this task if afforded the opportunity.