Efficiency through Contestability Programme – The Contestability Framework The Contestability Framework This fact sheet outlines the framework for assessing government functions in The Contestability Framework outlines a process for the systematic assessment of terms of their potential for efficiency and government functions to determine whether effectiveness improvement through particular functions should be open to contestability. competition, and if so, how competition should In the 2014-15 Budget, the Government occur. introduced a Commonwealth-wide Using contestability to potentially improve the Contestability Framework to be applied through efficient and innovative achievement of an the Efficiency through Contestability objective requires considering a spectrum of Programme led by the Department of Finance. arrangements, both within and beyond the Under the Contestability Framework, the boundary of government. Commonwealth public sector is expected to However, where there is another approach or constantly improve its performance and provider – from public, private or efficiency so it achieves better outcomes for the not-for-profit sectors – who can potentially Australian community. offer better, more efficient and more effective In particular, the Contestability Programme ways of delivering a function, then the function recognises that the public sector must continue should be considered for outsourcing, in part or to improve the way it designs and delivers as a whole. policies, programmes and services to Process simultaneously reduce costs, and meet the Australian community’s demand for Through the application of the Contestability better-quality government services. Framework, government entities are asked to consider the range of contestability approaches Many people incorrectly presume that available to them before deciding on the most contestability and competition equates with appropriate means of improving the way they outsourcing. However, contestability is based design and deliver government policy, on research which shows that even the credible programmes or services. threat of competition from potential providers is sufficient to motivate public sector providers to perform better, at potentially lower cost. What is Contestability? The prospect of competition in public Within contestability there are a range of sector activities to motivate efficiency and alternative approaches, including cooperative and competitive arrangements, to consider and performance improvements in policy, pursue. Contestability approaches range from programme and service delivery. improving internal processes; partnering with, or transferring functions to, other organisations An Overview of the Contestability inside or outside of government; through to Framework fundamentally restructuring how the function is achieved. Contestability Assessment
Efficiency through Contestability Programme – The Contestability Framework This fact sheet outlines the framework for assessing government functions in terms of their potential for efficiency and effectiveness improvement through contestability. In the 2014-15 Budget, the Government introduced a Commonwealth-wide Contestability Framework to be applied through the Efficiency through Contestability Programme led by the Department of Finance. Under the Contestability Framework, the Commonwealth public sector is expected to constantly improve its performance and efficiency so it achieves better outcomes for the Australian community. In particular, the Contestability Programme recognises that the public sector must continue to improve the way it designs and delivers policies, programmes and services to simultaneously reduce costs, and meet the Australian community’s demand for better-quality government services. Many people incorrectly presume that contestability and competition equates with outsourcing. However, contestability is based on research which shows that even the credible threat of competition from potential providers is sufficient to motivate public sector providers to perform better, at potentially lower cost. Within contestability there are a range of alternative approaches, including cooperative and competitive arrangements, to consider and pursue. Contestability approaches range from improving internal processes; partnering with, or transferring functions to, other organisations inside or outside of government; through to fundamentally restructuring how the function is achieved. The Contestability Framework The Contestability Framework outlines a process for the systematic assessment of government functions to determine whether particular functions should be open to competition, and if so, how competition should occur. Using contestability to potentially improve the efficient and innovative achievement of an objective requires considering a spectrum of arrangements, both within and beyond the boundary of government. However, where there is another approach or provider – from public, private or not-for-profit sectors – who can potentially offer better, more efficient and more effective ways of delivering a function, then the function should be considered for outsourcing, in part or as a whole. Process Through the application of the Contestability Framework, government entities are asked to consider the range of contestability approaches available to them before deciding on the most appropriate means of improving the way they design and deliver government policy, programmes or services. What is Contestability? The prospect of competition in public sector activities to motivate efficiency and performance improvements in policy, programme and service delivery. An Overview of the Contestability Framework Contestability Assessment
fact-sheet-contestability-framework.docx