Financial Accountability & Management, 24(1), February 2008, 0267-4424

BEYOND NEW PUBLIC MANAGEMENT:

AGENCIFICATION AND REGULATORY REFORM
IN NORWAY
TOM CHRISTENSEN, AMUND LIE AND PER LAEGREID∗

INTRODUCTION

The view is widespread that we are living in the era of the Regulatory State
(Majone, 1997; and Moran, 2002). The goals of the Regulatory State are
to improve the efficiency of the economy, promote competition, and protect
consumers and citizens. The Regulatory State tends to favor regulation over
other means of policy-making. It is more a rule-making state than a taxing and
spending state. Market regulation is more important than the redistribution
of income and macro-economic stabilization, the application of regulation is
more formal, and privatization is a central feature (Majone, 1997; and Levi-
Faur and Gilardi, 2004). It involves a shift from direct to indirect government,
and important policy-making powers are delegated to independent technocratic
bodies which have considerable political leeway to make supposedly objective
decisions mainly based on professional competence and unambiguous rules.
The state is kept at arm’s length from direct participation in the economy, but
has a well-developed regulatory role. In line with the New Public Management
(NPM) movement, the Regulatory State separates regulatory activities from
operational ones, purchasers from providers, and the policy-making role from
the operational role. This contrasts with the traditional welfare-state model,
which integrates regulatory, operating, and policy-making functions. In the
Regulatory State, greater emphasis is placed on single-purpose and non-
overlapping organizations and monitoring by autonomous agencies (Boston
et al., 1996). The long tradition of public ownership and direct ministerial
scrutiny within integrated public organizations seems to have come to an end,
or at least been pushed back or modified. The new recipe is semi-independent
regulatory agencies, which are supposed to have autonomy from both government
and ministerial control and to be independent of business and stakeholders.

∗ The authors are respectively, Professor at the Department of Political Science, University of
Oslo; a PhD-student at the Department of Political Science, University of Oslo; and Professor
at the Department of Administration and Organization Theory, University of Bergen. This
paper is written as part of the research project ‘Regulation, Control and Auditing’, funded by
the Norwegian Research Council.
Address for Correspondence: Per Lægreid,Department of Administration and Organization
Theory, Christiegt. 17, 5007 Bergen, Norway.
e-mail: Per.Lægreid@aorg.uib.no


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd, 9600 Garsington Road,

Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA. 15
16 CHRISTENSEN, LIE AND LÆGREID

In this paper we will first describe some general trends in the development
of regulatory reform and the agency form. Second, we will focus on the case of
Norway by describing the reform process and some lessons learned. Third, we
will discuss the development through the prism of different theoretical lenses.
Finally, we will draw some conclusions and discuss possible future developments
beyond New Public Management.

THE DEVELOPMENT OF REGULATORY REFORM AND THE AGENCY FORM

In the context of privatization and neo-liberalism, the increased focus on regula-

tion represents a paradox (Jordana and Levi-Faur, 2004). Even as deregulation
becomes a major trend, regulatory agencies with enhanced autonomy have
been created in large numbers. Deregulation is often the first step towards
re-regulation, but in a new form. Neo-liberalism promotes deregulation at the
ideological level, but in practice it is accompanied by more regulation, probably
showing a political reluctance to let go of control levers. The number of rules has
not decreased but increased in the era of neo-liberalism. There is a trajectory of
‘freer markets, more rules’ (Vogel, 1996). This reflects an inconsistent attitude
among politicians, who are demanding a reduction in rules while at the same time
producing new ones (Aberbach and Rockman, 2000). This paradox is a central
feature of regulatory reform. Deregulation and liberalization are followed by
more rules and regulation, leading to the growth and increased complexity of
the Regulatory State and public bureaucracies (Vogel, 1996). Regulatory reforms
and liberalization often imply new forms of regulation rather than deregulation
in practice. In contrast to the deregulatory aspects of New Public Management,
which was supposed to roll back the state and give first priority to market
interests, this trend has enhanced the growth of the Regulatory State.
Central agencies are key institutions in most developed countries. Not all
agencies are regulatory agencies: some are primarily responsible for managerial
tasks, while others provide services or offer policy advice. In this article we will
mainly use Pollitt and associates’ (Pollitt et al., 2004; and Pollitt and Talbot,
2004) rather narrow definition of an agency as a structurally disaggregated
body, formally separated from the ministry, which carries out public tasks
at the national level on a permanent basis, is staffed by public servants, is
financed mainly by the state budget, and is subject to public legal procedures.
Agencies have some autonomy from their respective ministry in policy decision-
making and over personnel, finance, and managerial matters. Yet they are not
totally independent, because political executives normally have ultimate political
responsibility for their activities.
In addition, the agency culture tends to involve role purification, whereby
policy formulation, service delivery, purchasing, and regulation are split up
and allocated to specific agencies. Role purification is handled according
to the principle of ‘single-purpose organizations,’ thus increasing horizontal
specialization both within and between public organizations (Boston et al. 1996).


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 17
In contrast to the former integrated model in which regulation was one of
many tasks and a by-product of other relationships, the new model creates
specialized agencies responsible for regulation and inspection with explicit
allocated resources.
The agency model is different from the traditional integrated bureaucratic
model in that it combines expertise, autonomy, and specialization of tasks in
a narrow range of policy issues (Majone, 1997). There is separation both on a
vertical dimension between agencies and ministries and on a horizontal dimen-
sion between different agencies responsible for different tasks. This creates a lot
of organizational complexity, potentially requiring more coordination (Gregory,
2003). Structural changes, leading to the creation of agencies, and regulatory
reforms often go together. But it is also possible to have structural reorganization
without changing the regulations and vice versa. Not all central agencies are
regulatory agencies, and not all regulation is conducted by agencies.
Agencies are popular organizational forms in contemporary administrative
reforms (James, 2003; and van Thiel, 2004) and have expanded in number
and importance over the past decades (Flinders, 2004). One example is the
British Next Steps program, which created more than 140 new semi-autonomous
agencies. A study of regulatory agencies in six policy areas in 36 countries reveals
that the number of regulatory agencies increased from 28 in 1986 to 164 in 2002
(Jordana and Levi-Faur, 2005). Until about 1990 there was no significant increase
in the number of regulatory agencies (Dunleavy, 1991), but in some countries,
like Norway, the number of regulatory agencies has increased relative to other
kinds of agencies over the past 15 years (Rubecksen, 2004). A comparative study
of public management reforms reveals that the number of central agencies has
grown in 10 of the 12 countries examined in Europe (Pollitt and Bouckaert,
2004). The number of regulatory agencies has also increased in Eastern Europe,
East Asia, Latin America, and in developing countries (Jordana and Levi-Faur,
2005; and Pollitt and Talbot, 2004).
A common misconception is that quasi-autonomous agencies are a recent
invention. In fact, it would be more accurate to call them a reinvention. In
some countries, like Sweden, agencies of this kind can be traced back 300 years,
and in Norway they began to emerge from the 1850s onwards. There is also
a long tradition of strong autonomous agencies being responsible for policy
implementation and service delivery. What regulatory reforms have done is to
change the role of traditional inspectorates and agencies.
There is little doubt that we are facing a ‘regulatory explosion’ and an epidemic
of ‘agency fever,’ with quasi-autonomous regulatory agencies becoming accepted
as ‘best practice’ all over the world and as a policy fashion of our time (Pollitt
et al., 2001; and Levi-Faur, Jordana and Gilardi, 2005). In contrast to the old
integrated model, in which policy-making, regulation, and service-delivery were
unified under ministerial control, the new single-purpose-organization model
envisages specific organizations for specific tasks and activities. The willingness
to delegate authority to non-majoritarian institutions, which fulfill public


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
18 CHRISTENSEN, LIE AND LÆGREID

functions but are not directly accountable to voters or their representatives,

seems to be increasing (Majone, 1999).
This does not, however, mean that all agencies are the same. In spite of a
clear trend towards regulatory policy convergence, national differences persist
when it comes to the implementation of regulatory reforms. The spread of
the new regulatory paradigm has not led to convergence in the organizational
design of regulatory agencies. Tenbücken and Schneider (2004) label this parallel
process of stability and change ‘divergent convergence.’ The argument is that
the Regulatory State and its distinct structural features are contingent on
national settings, state traditions, and administrative cultures (see Christensen
and Lægreid, 2001).

THE CASE OF NORWAY

From Reluctant to Eager Reformer

The dominant agency model in Norway has historically been rather unified,
with little horizontal specialization. In most agencies administrative functions,
regulatory and control functions, and service-production functions have been
combined and integrated. It is a rather new idea that there ought to be different
types of agencies for different tasks, even if some of the agencies have had
extended autonomy for some time (Lægreid et al., 2003).
Over the past 15 years, partly inspired by NPM, but also as part of Norway’s
adaptation to the EU and the internal market, a process of structural devolution
has been going on in the Norwegian central public administration in Norway,
and the agency model has become more differentiated (Christensen and Lægreid,
2003a). Agencies are receiving more formal authority, and roles and functions
among agencies are becoming more differentiated and non-overlapping.
When NPM arrived in Norway in the 1980s, the main strategy was to adapt
it to the historical path Norway has followed and use only the least radical
reform elements (Christensen and Lægreid, 2001). This modest strategy came
under pressure in the 1990s and Norway became more eager to implement NPM
ideas. Structural devolution started slowly in the early 1990s. The result was
more autonomy for agencies and public enterprises. Until the mid-1990s major
public sectors were organized as integrated government services, whereby the
state held the roles of owner, provider, purchaser, regulator, and controller. Since
then, the commercial parts of these enterprises have become corporate, while the
regulatory parts have been streamlined into separate agencies, creating a much
more fragmented and disintegrated model. Over time an increasing proportion
of agencies have been allocated regulation and scrutiny as their primary task
in addition to other, secondary tasks (Rubecksen, 2004), showing that a pure
regulatory model has yet to emerge.
On the one hand, the reforms put in place during the 1990s implied that
the agencies were to gain more autonomy, both from the political leadership


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 19
and from market actors. On the other hand, central political control was
to be enhanced by strengthening frame-steering and regulatory power. The
political authorities were expected to abstain from involvement in individual
cases but at the same time strengthen their role as general regulators through
the formulation of laws and rules or by the use of other general control
instruments.
Reorganization of public activity in Norway over the last ten years has been
characterized by a gradual move away from an integrated to a more fragmented
state, but it is still lagging behind the typical NPM Anglo-American countries
in this respect. The reform strategy in Norway has been to avoid privatization
by concentrating on structural devolution within the public sector. In contrast
to many Anglo-American countries, the main trend in Norway has not been
privatization but transforming central agencies into state-owned companies.
In the period 1990–2002, 34 new state-owned companies were established
(Lægreid et al., 2003). This development has been characterized by relative
consensus, with the Labor Party as a key actor, although it has for some time
encountered problems in translating this into electoral success. In 2000–2001
the Labor Government implemented a partial privatization of Telenor, the
telecom monopolist, and Statoil, the large government-owned oil company. It
also implemented an NPM-inspired reform of the hospitals. In 2002 ownership
of Norwegian hospitals was transferred from the counties to central government.
The reform also set up new management principles for the hospitals based on a
decentralized enterprise model (Lægreid, Opedal and Stigen, 2005).

A New Regulatory Policy

The Conservative-Center minority government that came to power in 2001
and was dominated by the Conservative Party espoused a more radical NPM-
inspired reform agenda. The minister of government administration imitated
the main features of the allegedly successful reform program pursued by New
Zealand in the 1980s, which involved a lot of structural devolution, ‘single-
purpose organizations,’ competitive tendering, efficiency measures, consumer
choice, and decentralized service provision (Christensen and Lægreid, 2003b).
In imitating this program, the Norwegian government took it for granted that
NPM had been a success in New Zealand, even though there were already signs
of fragmentation problems there at the time (Gregory, 2003).
The recommendation of the OECD, which was enhanced by the increased
integration of Norway into the EU internal market through the European Area
Agreement, was to separate the regulatory function from commercial and other
functions and to reduce the potential for ministerial intervention by making
agencies more autonomous and professional. Consensus-based decision-making
was to be replaced by evidence-based decision-making, and political intervention
in particular decisions by the establishment of expert-based appeal bodies
outside the political system. Subsequent developments showed that this ideal


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
20 CHRISTENSEN, LIE AND LÆGREID

was difficult to implement, partly because a minority government was forced to

engage in compromises.
In 2003 the government put forward a White Paper to the parliament,
proposing changes in regulatory agencies. The White Paper aimed to change
the reform process from ad hoc and piecemeal changes in individual agencies
to an overarching and comprehensive regulatory policy. The argument was that
even though there were no major problems with the way regulatory agencies
worked (echoing the OECD), it was important to anticipate future challenges.
The government argued, first, that the ministries ought to expand their role
as a ‘secretariat’ for the political leadership and leave individual cases to more
autonomous agencies. Second, it argued that regulatory agencies should have
unambiguous roles, thus breaking with the Norwegian tradition of integrating
different roles and functions. Third, regulatory agencies should increase their
independence from the ministries, political and professional considerations
should be more clearly defined, and the way they were to be balanced made more
explicit. Fourth, it was important to strengthen the professional competence of
the regulatory agencies. In addition, it was proposed to relocate some of the
regulatory agencies away from the capital.
The result of the negotiating process in the Storting (parliament) was a mixed
solution. The government got support for moving eight regulatory agencies out
of Oslo, but the upshot on the formal changes was more mixed. The opposition
managed to assert its view that appeals generally should not be moved out of
the ministries for the time being, and that changes concerning other aspects of
the regulatory agencies should be made only on a case-by-case basis and not in
a general and sweeping way. The solution was therefore a hybrid one.
Even though the Conservative-Center government was eager to pursue NPM
reforms, its record was ultimately rather mixed. It eagerly pushed through plans
for local authorities to establish ‘one-stop shops’ for local service provision and
also made headway in changing public administration agencies into state-owned
companies, in introducing a so-called ‘quality’ reform for universities and higher
education, and in merging the unemployment agency, the national insurance
agency, and the social affairs agencies. All of these new forms of organization
contained elements of NPM in the sense of structural rationalization and an
increased emphasis on efficiency. Yet the increased weight given to coordination
and integration went against the grain in terms of making public-sector
organizations more specialized. Moreover, it decided that the immigration
authorities should be subject to more control, a move which also ran counter
to the main motives behind the regulatory agency reform (Christensen and
Lægreid, 2005).

Towards a Second Generation of Reform?

Before the national election in 2005 the Labor Party formed an alliance with the
Center Party and the Socialist Left Party. This alliance pretty much ran on an


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 21
anti-NPM ticket, arguing that enough was enough and that NPM reforms must
be stopped or modified because of their negative consequences, including less
political control, increased importance of private providers in the public sector,
decreasing quality of service, increasing social inequality, etc. It was particularly
interesting that this view was espoused by the Labor Party, which had previously
been seen as an NPM supporter. The alliance won the election and formed a Red-
Green government. The question now is whether the anti-NPM platform will
remain just rhetoric or whether it will result in major changes? The government
has already started to modify or stop some of the NPM-like reforms, but the
crucial question is what the Labor Party will eventually support.
Generally, the reform process is characterized by both robustness and
flexibility. Modern agencies in Norway report that they have a lot of autonomy,
but at the same time they also face a significant amount of control (Lægreid,
Roness and Rubecksen, 2006). The agencies do not react quickly to new
regulatory policy signals and there seems to be a lot of robustness and reluctance.
Old forms of control do not fade away in the new Regulatory State. Rather they
are supplemented by new instruments of control, resulting in a more complex
regime. Thus, in the case of Norway the picture is not a one-dimensional trend
towards more autonomy for all kinds of agencies. We have over the past few
years seen a reassertion of the center in some policy areas.
The Hospital Reform indicates a more complicated picture, with attempts to
secure both political control and enterprise autonomy at the same time. While
remaining loyal to the owner, the Ministry of Health enterprises are also trying
to maximize their own autonomy. In many cases this increased autonomy is
being challenged by political intervention over single issues and by other political
efforts to reassert political control. One of the main challenges of the reform is
to balance the autonomy of health enterprises and political control by the central
government (Lægreid, Opedal and Stigen, 2005).
The trend towards ‘single-purpose organizations’ has not been consistent
across sectors and agencies either. Some units have been merged into bigger
agencies, such as the Food Control Agency and the Directorate for Health and
Social Affairs, but despite the trend towards ‘single-purpose agencies,’ combining
different tasks within the same agency is still quite a widespread practice
(Lægreid, Roness and Rubecksen, 2008).
Summing up, agencies have been a major organizational form in the
Norwegian central government for a long time and have displayed a lot of path-
dependency. This situation was the result of a long historical conflict between the
political executive and professional groups. When the NPM movement gained
pace internationally from the early 1980s, Norway became a reluctant reformer
(Olsen, 1996). Since the mid-1990s NPM has gained a stronger footing in Norway,
and reforms have become increasingly comprehensive and radical in recent years
(Christensen and Lægreid, 2002). Changes in forms of affiliation from integrated
ministerial models to single-purpose models, increased agencification, and the
establishment of autonomous supervisory bodies have been the result.


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
22 CHRISTENSEN, LIE AND LÆGREID

The Conservative-Center government (2001–2005) tried to push Norway in a

more typical neo-liberal direction, trying to compensate for some of the former
reluctance, but its reform practice lagged behind its ideals, and some efforts
were made to reassert central control. The present Red-Green government will
obviously try to modify some of the more extreme NPM features. However, the
government does not have a clear administrative policy and is conflict-ridden in
this respect, particularly since the Labor Party is more interested in reform than
the Socialist Left Party in the coalition government.

Some Lessons
One main lesson from the gradual move towards a more autonomous position for
the traditional agencies is that this may undermine political control (Christensen
and Lægreid, 2002). Administrative executives may use symbols to defend
their stronger position, or a gradual weakening of political control may be
accepted, since there is considerable trust and similarities in attitudes and norms
among political and administrative leaders. This reorganization is significant in
several ways. First, it shows a development from an integrated state model,
where many functions are handled in the ministries or in agencies under tight
control by the ministries, to a management-inspired model, where agencies are
more autonomous and loosely coupled to the ministries. Second, the ministries’
ability to control the agencies is thereby weakened, political signals are less
significant to the agencies, and it is more difficult for political executives to
get information from the agencies (Christensen and Lægreid, 2001). This is
potentially problematic in a system where structural devolution is combined
with continuing adherence to the principle of ministerial responsibility towards
the parliament. Third, there would seem to be potential for increasing problems
of capacity and coordination.
Another general lesson from the Norwegian case is that the division of tasks
and responsibilities between ministries and agencies is much more complicated
in practice than in theory. The balance between policy areas, between specialized
regulatory agencies and general regulators, and between administrative levels
is unstable and varies both over time and between normal situations and crises.
The balance between control and autonomy varies according to a number of
factors, such as how extensive and radical the devolution is, the base line, the
political-administrative culture, and various polity features (Grønlie, 2001).
Normally there are overlaps in responsibility, and a ‘discretion zone’ or a
‘zone of indifference’ exists in which regulatory agencies can operate in the
shadow of political executives and make autonomous decisions. If they go
beyond that zone, politicians might interfere and strengthen their control,
so anticipated reactions also play a role. This means that the relationship
between political and administrative executives might be expressed more in
terms of ebb and flow than as a linear development towards less political
control.


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 23
On the one hand, when regulatory agencies work well, they may enhance
credibility and predictability and reduce the need for both political control and
for the direct participation and involvement of citizens in the regulatory process.
A high level of mutual trust may enhance this, as well as a strong common
culture (Boin, 2001). This is, however, not always the case. On the other hand,
it is not always clear what the effects of the new regulatory system are in
practice. Therefore, we should be cautious about jumping to conclusions on the
basis of formal and legal changes, since the implementation process may still
involve negotiations, flexible cooperation, and mutuality and informal control
and steering, despite the more formal nature of the new regulatory regime (Hood
et al., 1999). However, one main argument is that structural devolution changes
and weakens the instruments of control and increases the distance between
the political leadership and subordinate units and lower levels of management
(Christensen and Lægreid, 2005). In practice regulatory reforms tend to run
into problems of bureaucratic politics and institutional constraints during the
implementation process.
The connection between specialization and coordination is important. All
other things being equal, increasing specialization implies a need for greater
efforts at coordination. Otherwise, the danger is that newly specialized agencies
will go their own way (Pollitt and Bouckaert, 2004, p. 84). The specialization
involved in creating single-purpose agencies tends to increase the difficulty of
coordination and the capacity problems of political executives, because more
issues and policy questions are channeled up to the ministries and the cabinet,
instead of being weighed-up and decided lower down in the hierarchy. This has
been revealed in countries such as New Zealand, the UK and The Netherlands
(Pollitt and Bouckaert, 2004). Problems with coordination have enhanced the
need for ‘joined-up’ government and ‘whole-of-government’ strategies, both
vertically between ministries and agencies, and horizontally between policy areas.
These strategies are especially visible in countries like the UK and New Zealand,
which have been most radical in the NPM movement (Gregory, 2003; and James,
2004).
A central accountability issue is how the relationship between government
and regulators impinges on ministerial responsibility. It is generally accepted
that ministries should be allowed to give some interpretative guidance to the
regulators on how to carry out their function; however, this is expected to be
general guidance and not directed at specific cases. One problem with such
guidance is that frame-steering often makes political executives feel they are
losing control, since specific cases, in which they are not supposed to interfere,
may have general implications (Christensen and Lægreid, 2002). It is unclear
what kind of interests and considerations are replacing traditional political
signals and discretion, or how the trade-off between political control and agency
autonomy will unfold over time.
One observation is that power relations seem to be changing faster than
accountability relations. The political leadership often finds itself in situations


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
24 CHRISTENSEN, LIE AND LÆGREID

where it has responsibility without the corresponding power and control, and
seems to have trouble getting relevant information about the activities of
subordinate organizational units and levels. Conversely, many of the autonomous
agencies may gain more power without necessarily becoming more accountable.
Politicians may, however, interfere if there is a power struggle between political
executives and parliament, or if the media define an issue as a crisis (Christensen
and Lægreid, 2005). The Storting is often unpredictable in its attitude to
interference, for it may demand executive action when it has decided on
agency autonomy but demand non-interference when political executives have
interfered because of political pressure, i.e. typical ‘double-bind’ situations.

DISCUSSION AND THEORETICAL INTERPRETATION

Why has Norway for a long time been a rather reluctant reformer? Norway
has traditionally scored low on both external and internal factors triggering
reform. The absence of an economic crisis together with strong confidence in
an active and large public sector makes for relatively low external pressure.
These features, combined with parliamentary turbulence, minority governments,
reforms driven internally by bureaucrats, and a traditional administrative culture
that is probably incompatible with many elements of NPM, might explain why
Norway started late with NPM reforms and for some time chose an incremental
path (Christensen and Lægreid, 2001).
Seen from an instrumental perspective, Norway implemented some of the
same NPM elements as other countries, but over a relatively long time period
and in a rather reluctant manner. One could also argue that since Norway has
been lagging behind, this could mean that it is now under greater pressure to
take account of reform trends in other countries. Norway has also culturally
filtered, interpreted, and modified the reforms and created Norwegian variants
of them, making them more acceptable. It was already accepted in the early
1980s that the Norwegian government needed to be modernized and made more
efficient, but until the mid-1990s this rather general assumption did not result
in much change, and reform symbols were rather muted.
So what were some of the instrumental arguments in favor of NPM that Norway
gradually accepted over time? One main argument for increased horizontal
specialization is that it enhances efficiency and effectiveness, clarifying functions,
avoiding overlap, and making authority and lines of command less ambiguous.
In addition, one main argument for increased vertical specialization is that
efficiency and quality of services can increase substantially through vertical
specialization. Increased efficiency can create more options for fulfilling political
goals. The easier it is to ‘purify’ the different roles, the easier it is to balance
different considerations, to handle accountability questions, and to judge the
preconditions for political and administrative control (Boston et al., 1996).
These arguments fit in well with the expectations engendered by the official


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 25
model that structural devolution and more managerial autonomy combined
with performance management will improve performance and efficiency, without
having negative side-effects on other values like control and democracy (Pollitt
et al., 2004).
Adding to this, from a cultural-institutional point of view, the traditional
political-administrative culture of the Norwegian system has also been gradually
changing, putting internal pressure on political leaders. Central administrative
leaders are generally more sympathetic towards reforms than before, and a new
generation of agency leaders and directors in SOCs are urging a reform of the
system, emphasizing the expected efficiency effects of structural devolution.
In addition, international institutional pressure on Norway has become stronger,
because it has been lagging behind international trends (Christensen and
Lægreid, 2004).
A cultural-institutional interpretation of the reforms will also point to the fact
that role enactment is always associated with a certain degree of discretion and
interpretation. In addition to the changes made in their formal role, executive
political leaders also need to give signals about how to interpret new frames, and
subordinate leaders must make their own judgments about how to use their new
discretionary power. This creates a grey zone between politics, administration,
and commercial activities in government. If there are strong trust relations and
well developed common norms and values between the different groups, this
is not a great challenge. However, if there is distrust and competing beliefs
between the different actors involved, conflict and tensions within the political-
administrative apparatus may mount up. The Norwegian system of government
has been characterized by a high degree of mutual trust at the central level
(Christensen and Lægreid, 2002). There are indications that this trust is now
being challenged and that mutual trust as a coordinating mechanism is no longer
functioning as efficiently as previously. One reason for this might be that an
increasing number of management tools are based on distrust.
We argue that single-perspective studies have limitations and we therefore try
to take a broader, more mixed approach that combines different perspectives.
The complexity of the organizational context matters, task-specific factors are
important, and much of what happens is the result of a blend of external
pressure, path dependency, and choice (Olsen, 1992). The agency form is a
broad category that embraces quite a variety of ways of operating and of
relationships with an agency’s parent ministry or other actors. The importance
of the basic organizational structural form of the regulatory agency must be
supplemented by other characteristics, such as the primary tasks enacted,
political-administrative traditions, and culture, as well as external pressure,
both economic and ideological (Lægreid, Roness and Rubecksen, 2006). Such
features constrain the scope for managerial strategies as well as political choice
and design by executive political leaders (Pollitt et al., 2004).
A difference between Norway and more radical reform countries is that
reforms in Norway are more sector-oriented than the more superior-oriented


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
26 CHRISTENSEN, LIE AND LÆGREID

reforms in countries such as the United Kingdom, Australia, and New Zealand.
A fragmented public apparatus in Norway has produced fragmented reforms.
Ministries and agencies have been more oriented towards pursuing their own
reform agendas than towards attending to a common, comprehensive, and broad-
scope reform strategy.
A main observation is that one cannot easily infer from regulatory programs
and formal agency structure to practice, meaning that although some main
effects are apparent, there is a lot of variation (Pollitt, 2004). The legal status
and formal powers of the agencies represent broad categories that allow for
differences in practice. There are variations in how the rules for control,
instructions, and appeals are formulated for different agencies and how they
are executed. Instead of deriving explanations based on a dominant logic, the
challenge is to develop more complex propositions about how regulatory agencies
are organized, how they work, and how they are transformed.

CONCLUDING REMARKS AND FUTURE EXPECTATIONS

What kind of further development of government can one expect based on

our analysis? The experience of NPM reforms over the last 15–20 years can
be interpreted within three different scenarios (Olsen, 1992; and Christensen
and Lægreid, 2001). First, one idea is of a linear process towards more
market, management, and efficiency. If one interprets some of our main results
as showing a dominance of the main NPM ideas and practices, a possible
future trend would be further dominance of the new administrative orthodoxy.
Accordingly, there is no alternative to the main thoughts behind the NPM
reforms and they will continue to become even more dominant in the future,
making isomorphic and global trends more evident.
Norway has some features that fit this scenario. Traditionally, Norway has
lagged behind many other countries in implementing classical NPM features
and could well have continued to be a rather reluctant reformer, carefully
adapting modified reform elements. Given that strong elements of horizontal
and vertical specialization have caused problems of fragmentation and lack
of coordination in countries such as Australia and New Zealand, this could
have been a plausible option. In addition, pressure for radical reforms in
Norway, owing to good public finances and oil revenue, remained weak. However,
Norway did not choose to continue along the reluctant path. Instead, from the
mid-1990s onwards it embarked on more radical reform efforts, raising the
more profound question of exactly how international reform imitation occurs.
The new regulatory arrangement involves both more horizontal and vertical
specialization, but it is not a simple and automatic adjustment to international
administrative doctrines (Lægreid et al., 2003).
The reason for more radical reform efforts was partly ideological. The
Conservative Party experienced a kind of neo-liberal awakening and was eager to
prove an ideological point, using a lot of symbols to do so. The Conservative Party


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 27
was probably also encouraged politically by a good election result in 2001, giving
it a strong political mandate for neo-liberal reforms. It obviously also thought
that the Labor Party would continue to support the NPM agenda. However,
it is an open question whether more professional independence for experts in
autonomous agencies will prevail, or whether there will be a counter-wave of
re-politicization under the new government.
The second scenario is that after a period of NPM there will be reactions to the
norms and values that the reform is built on and a return to some of the main
features of the ‘old civil service’ and a rediscovery of the Weberian bureaucracy
(Pollitt and Bouckaert, 2004; and Olsen, 2006). In pluralistic societies uneven
institutional change is likely to generate countervailing forces (Olsen, 1998).
The general argument behind this is that history moves in a cyclical way – after
a period of centralization follows decentralization, after specialization comes
co-ordination, and after emphasizing economic aspects of public activities, non-
economic values come to the fore again (Peters, 1996, p. 17). The ideas behind
reforms will change over time, according to changing political-ideological trends,
as will the driving forces and coalitions behind specific NPM-related reform
elements.
The current Red-Green government in Norway can be understood in terms of
this scenario. In the run-up to the election, the new Red-Green alliance obviously
thought that instead of pursuing neo-liberal reforms, it could run on an anti-
NPM ticket. This was a ticket based partly on general ideological sentiments
that stressed a large public sector, collective goals, control of public service
provision, emphasis on equality, etc., all elements seen as running counter to
NPM. Another element was a negative perception of the experiences of Australia
and New Zealand, and other typical NPM-countries (see Gregory, 2003). A third
element was that the effects of NPM in Norway were seen as negative, such as
negative experiences with hospitals run on NPM-principles, efficient home-based
care of the elderly, increased competition and differences in the school system,
etc. This mix of elements was supplemented by a lot of anti-NPM myths or
symbols. The big question now is how this new alliance will cope with the radical
NPM measures installed during the 2001–2005 period. Will the new Red-Green
government move away from the NPM path or at least modify it, and will it again
follow in the foot-steps of New Zealand and Australia. The initial phase of this
government seems to indicate at least some modifications.
A third interpretation is that rather than a linear or a cyclical process there is
a co-evolution of reform ideas, administrative practice, and theory (Christensen
and Lægreid, 2001; and March and Olsen, 1989). Political-administrative
systems in Western democracies are at a historical juncture and open to a
dialectical process and a new synthesis between Old Public Administration and
New Public Management. NPM has contributed to creating more complexity
in the public sector, and this development will be more evident into the new
millennium. New managerial tools are not replacing old ones, but supplementing
them. One element of this is that NPM is creating a more multi-structured


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
28 CHRISTENSEN, LIE AND LÆGREID

public apparatus and more hybrid structural solutions, owing to more complex
considerations and confrontation between structural design principles (Peters,
1996, p. 17).
Our conclusion is that Norway seems to exemplify this last scenario. It was
already a rather complex system in the first place, and it has now got caught
up in the countervailing trends of NPM and post-NPM reforms. The Norwegian
case seems to indicate that there is a need to look beyond the reform doctrine
and develop a more differentiated view of the problems of governing the public
sector.
Based on the discussion in this paper, we would like to make three suggestions
for further research on regulatory reform and autonomous agencies (Christensen
and Lægreid, 2006). First, the changing relationship between politicians and
bureaucrats and ways of balancing agency autonomy with political control are
research issues that deserve greater attention (Peters and Pierre, 2001). The
balance between autonomy and control is difficult to find and hard to maintain,
and a main challenge is to clarify under what conditions the equilibrium tends
to tip one way or the other. Second, moving regulatory decision-making to
autonomous agencies is not only about non-political technical and technocratic
efficiency but also involves sensitive political trade-offs and value-based choices
(Lodge, 2004). Such trade-offs are often unstable and ambiguous and have clear
political components that cannot easily be resolved using purely technical criteria
(Jordana and Sanco, 2004). Third, it might be wise to go beyond the rather state-
centric approach and apply a more transnational and multi-level perspective.
The increased autonomization and Europeanization of regulatory agencies and
the parallel development of autonomous regulatory agencies in the EU and in
the member states might create a direct link between regulatory agencies at
different levels, thus bypassing the domestic ministerial structure.

REFERENCES
Aberbach, J.D. and B.A. Rockman (2000), In the Web of Politics. Three Decades of the U.S. Federal Executive
(The Brookings Institution Press, Washington, DC).
Boin, A. (2001), Crafting Public Institutions. Leadership in Two Prison Systems (Lynne Rienner Publishers,
Boulder).
Boston, J., J. Martin, J. Pallot and P. Walsh (eds.) (1996), Public Management – The New Zealand Model
(Oxford University Press, Auckland).
Christensen, T. and P. Lægreid (eds.) (2001), New Public Management. The Transformation of Ideas and
Practice (Aldershot: Ashgate).
——— ——— (2002), Reformer og lederskap. Omstilling i den utøvende makt (Reforms and Leadership.
Renewal in the Executive Power) (Universitetsforlaget, Oslo).
——— ——— (2003a), ‘Coping with Complex Leadership Roles: The Problematic Redefinition of
Government-Owned Enterprises’, Public Administration, Vol. 81, No. 1, pp. 803–31.
——— ——— (2003b), ‘Administrative Reform Policy: The Challenges of Turning Symbols into
Practice’, Public Organization Review: A Global Journal, Vol. 3, pp. 3–7.
——— ——— (2004), ‘Governmental Autonomization and Control: The Norwegian Way’, Public
Administration and Development, Vol. 24, pp. 129–35.
——— ——— (2005), ‘Autonomization and Policy Capacity – the Dilemmas and Challenges
Facing Political Executives’, in M. Painter and J. Pierre (eds.), Challenges to State Policy Capacity
(Palgrave, London).


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd
 BEYOND NEW PUBLIC MANAGEMENT 29
Christensen, T. and P. Lægreid (2006), ‘Agencification and Regulatory Reforms’, in T. Christensen
and P. Lægreid (eds.), Autonomy and Regulation. Coping with Agencies in the Modern State (Edward
Elgar, Cheltenham).
Dunleavy, P. (1991), Democracy, Bureaucracy and Public Choice (Harvester, Hemel Hempstead).
Flinders, M. (2004), ‘Distributed Public Governance in the European Union’, Journal of European
Public Policy, Vol. 11, pp. 520–44.
Gregory, R. (2003), ‘All the King’s Horses and all the King’s Men: Putting New Zealand’s Public
Sector Back Together Again’, International Public Management Review, Vol. 4, No. 2, pp. 41–58.
Grønlie, T. (2001), ‘Mellom politikk og marked – organisering av statlig næringsdrift’ (Between
politics and market – organizing state owned companies), in B.S. Tranøy and Ø. Østerud
(eds.), Den framgenterte staten (Gyldendal Akademisk, Oslo).
Hood, C. et al. (1999), Regulation Inside Government: Waste Watchers, Quality Police and Sleazebusters
(Oxford University Press, Oxford).
James, O. (2003), The Executive Agency Revolution in Whitehall (Palgrave, London).
——— (2004), ‘Executive Agencies and Joined-up Government in the UK’, in C. Pollitt and
C. Talbot (eds.), Unbundled Government (Routledge, London).
Jordana, J. and D. Levi-Faur (2004), ‘The Politics of Regulation in the Age of Governance’, in
J. Jordana and D. Levi-Faur (eds.), The Politics of Regulation: Institutions and Regulatory Reform in
the Age of Governance (Edward Elgar, Cheltenham).
——— ——— (2005), ‘The Diffusion of Regulatory Capitalism in Latin America: Sectoral and
National Channels in the Making of a New Order’, American Academy of Political and Social
Sciences, ANNALS 2005, pp. 1–23.
——— and D. Sancho (2004), ‘Regulatory Design, Institutional Constellations and the Study of
the Regulatory State’, in J. Jordana and D. Levi-Faur (eds.), The Politics of Regulation (Edward
Elgar, Cheltenham).
Lægreid, P., S. Opedal and I.M. Stigen (2005), ‘The Norwegian Hospital Reform. Balancing Polit-
ical Control and Enterprise Autonomy’, Journal of Health Politics, Policy and Law, Vol. 30, No. 6,
pp. 1035–72.
———, P.G. Roness and K. Rubecksen (2006), ‘Autonomy and Control in the Norwegian Civil
Service: Does Agency Form Matter?’, in T. Christensen and P. Lægreid (eds.), Autonomy and
Regulation. Coping with Agencies in the Modern State (Edward Elgar, Cheltenham).
——— ——— ——— (2008), ‘Controlling Regulatory Agencies’, Scandinavian Political Studies,
Vol. 31, No.1 (forthcoming).
———, V.W. Rolland, P.G. Roness and J.-E. Agotnes (2003), ‘The Structural Anatomy of the
Norwegian State 1947-2003’, Working Paper 21/03 (Rokkan Centre, Bergen).
Levi-Faur, D., J. Jordana and F. Gilardi (2005), ‘Regulatory Revolution by Surprise: On the Citadels
of Regulatory Capitalism and the Rise of Regulocracy’, Paper presented at the 3rd ECPR
Conference, Budapest (September 8–10).
Lodge, M. (2004), ‘Accountability and Transparency in Regulation: Critiques, Doctrines and
Instruments’, in J. Jordana and D. Levi-Faur (eds.), The Politics of Regulation (Edward Elgar,
Cheltenham).
Majone, G. (1997), ‘From the Positive to the Regulatory State. Causes and Consequences of
Changes in the Mode of Governance’, Journal of Public Policy, Vol. 17, No. 2, pp. 139–67.
——— (1999), ‘The Regulatory State and its Legitimacy Problems’, West European Politics, Vol. 22,
No. 1, pp. 1–24.
March, J. and J.P. Olsen (1989), Rediscovering Institutions (Free Press, New York).
Moran, M. (2002), Review article: ‘Understanding the Regulatory State’, British Journal of Political
Science, Vol. 32, pp. 391–413.
Olsen, J.P. (1992), ‘Analyzing Institutional Dynamics’, Staatswissenschaften und Staatspraxis, Vol. 3,
No. 2, pp. 247–71.
——— (1996), ‘Norway: Slow Learner – or Another Triumph of the Tortoise?’, in J.P. Olsen and
B.G. Peters (eds.), Lessons from Experience (Scandinavian University Press, Oslo).
——— (1998), ‘Civil Service in Transition – Dilemmas and Lessons Learned’, in J.J. Hesse and
T.A.J. Toonen (eds.), The European Yearbook of Comparative Government and Public Administration,
Vol. 3 (Nomos, Baden-Baden).
——— (2006), ‘Maybe it is Time to Rediscover Bureaucracy?’, Journal of Public Administration Research
and Theory, Vol. 16, No. 1, pp. 1–24.


C 2008 The Authors
Journal compilation 
C 2008 Blackwell Publishing Ltd
30 CHRISTENSEN, LIE AND LÆGREID

Peters, B.G. (1996), The Future of Governing. Four Emerging Models (University of Kansas Press,
Lawrence).
——— and J. Pierre (eds.) (2001), Politicians, Bureaucrats and Administrative Reforms (Routledge,
London).
Pollitt, C. and G. Bouckaert (2004), Public Management Reform. A Comparative Analysis (Oxford
University Press, Oxford).
——— and C. Talbot (eds.) (2004), Unbundled Government (Routledge, London).
——— ———, J. Caulfield and A. Smullen (2004), Agencies. How Governments do Things Through
Semi-Autonomous Organizations (Palgrave, London).
———, K. Bathgate, J. Caulfield, A. Smullen and C. Talbot (1991), ‘Agency Fever? Analysis of an
International Policy Fashion’, Journal of Comparative Public Analysis, Vol. 3, No. 3, pp. 271–90.
Rubecksen, K. (2004), ‘Civil Service Organizations in Norway: Organizational Features and Tasks’,
Working Paper 20/2004 (Rokkan Centre, Bergen).
Tenbücken, M. and V. Schneider (2004), ‘Divergent Convergence: Structures and Functions of
National Regulatory Agencies in the Telecommunications Sector’, in J. Jordana and D. Levi-
Faur (eds.), The Politics of Regulation (Edward Elgar, Cheltenham).
Thiel, S. van (2004), Quangos: Trends, Causes and Consequences (Ashgate, Aldershot).
Vogel, S. (1996), Freer Markets, More Rules: Regulatory Reform in Advanced Industrial Countries (Cornell
University Press, Ithaca and London).


C 2008 The Authors

Journal compilation 
C 2008 Blackwell Publishing Ltd