An exploratory study assessing compliance among municipal controllers and the possible explanations for their degree of compliance

• Author: Henk Klaassen,Rick Anderson,Herbert Maks
• Date: 01 August 2020
• DOI: http://doi.org/10.1002/pa.2068
• Published date: 01 August 2020

ACADEMIC PAPER

An exploratory study assessing compliance among municipal

controllers and the possible explanations for their degree of

compliance

Rick Anderson

1

| Herbert Maks

2

| Henk Klaassen

3

1

EIFFEL Research Department, Breukelen, the

Netherlands

2

Mathematics Department, Inholland

University of Applied Sciences, Hoofddorp, the

Netherlands

3

Mathematics Department, Erasmus

University Rotterdam, Rotterdam, the

Netherlands

Correspondence

Dr Rick Anderson, EIFFEL Research

Department, Arnhem, the Netherlands.

Email: randerson@eiffel.nl

Municipal controllers are sometimes confronted with requests from managers that

contradict with the legal provisions. This raises the question how municipal control-

lers deal with these requests and whether this would impact their compliance. This

article is a result of an exploratory study assessing compliance among municipal con-

trollers and the possible explanations for their degree of compliance. The study has

focused on one specific provision concerning accrual accounting, one of the elements

of new public management (NPM), which is prescribed for Dutch municipalities. The

study is based on a survey in 22 municipalities. The results show that the majority of

municipal controllers who participate in this study deviate from this legal provision.

There might be a relation between the orientation of the controllers and the degree

of compliance. The position of the controller within the municipality can be a signifi-

cant factor explaining this orientation. However, the size of the sample is too limited

to generalize. The conclusions of this study undermine the idea that municipal con-

trollers should act as business partners to the management. Finally, the study reveals

a paradox: while one of the main elements of NPM is to shift more responsibilities to

decentralized managers, this shift can lead to an increased principal-agent problem,

leading to a lesser degree of compliance.

1|INTRODUCTION

Since about the 1990s, Dutch municipalities, as well as local govern-

ments in manyother countries, introducedconcepts of new public man-

agement (NPM). These changes were brought about by budgetary

deficits in the 1980s and dissatisfaction within government organiza-

tions with centralized structures and input-oriented forms of control

(ter Bogt & van Helden, 2005, p. 248). NPM introduced concepts of

performance management, output-oriented planning and control; a

more “business-like”government based on rational management and

decentralized structuresin order to increaseefficiency and effectiveness

(Jansen,Gradus, Minderman, Budding, van Egten,2008a, 2008b, p. 170,

ter Bogt, 2008a, 2008b, p. 212, Vinnari & Näsi, 2008, p. 97). Profes-

sional managers of organizational units were given more freedom to

shift between budgets. To strengthen the accountability of those man-

agers, accrual accounting was prescribed to all Dutch local government

organizations (ter Bogt, 2008a, 2008b, p. 212). The implementation of

accrualaccounting aimed to get a clearer pictureof budgeted and actual

costs, to allocate these costs to output or performance and finally, to

get more insighton the degree of efficiency.Benchmarking and compar-

isons betweenmunicipalities becameindeed one of the main objectives.

In spite of the fact that some authors observe positive effects of the

implementation of NPM-like changes, especially on the long run (ter

Bogt, 2008a, 2008b), other authors are more critical (Jansen, et al.,

2008a, 2008b;Klaassen, Anderson,& Maks, 2010; van Helden,2000).

Most theories on the structuring of planning and control or, more

specifically, the structuring of budgeting processes are founded on

the assumption that organization-wide collective interests form the

basis of budgeting. The question is, however, whether this assumption

is valid in the practice of public administration (Aardema, 2007;

Bouckaert & Halligan, 2008; Klaassen et al., 2010; ter Bogt, 2008a,

2008b). An alternative assumption is that participants in a budgeting

Received: 13 July 2019 Revised: 22 September 2019 Accepted: 3 December 2019

DOI: 10.1002/pa.2068

J Public Affairs. 2020;20:e2068. wileyonlinelibrary.com/journal/pa © 2019 John Wiley & Sons, Ltd 1of13

https://doi.org/10.1002/pa.2068