E-health: A governance failure – Canadian Government Executive

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Digital Governance with Jeffrey RoyICT
May 7, 2012

E-health: A governance failure

The recent scandals plaguing Ontario’s e-health agency carry important lessons for the evolution of digital government and the challenges that lie ahead. Several years ago, many e-pundits were predicting that by right about now, the “e” would simply drop away as IT became pervasive in revolutionizing public sector governance and performance. Alas, the truth appears a good deal more complex.

The Ontario experience instead reminds me of a report published by the OECD in 1999 on the “hidden threat” to e-government, namely the inability to manage large scale IT initiatives and bring them online on time and on budget.

At the heart of the scandals in Ontario have been questions about costs – and relationships with expert consultants deemed necessary to close the gap between Ontario and other jurisdictions in terms of e-health infrastructure. Many such experts were brought in from Alberta and elsewhere at great cost to the public purse – and they were abusive, critics charged, in their billing practises and loose definitions of what defines “work.” Moreover, the bills were paid.

Defenders have pointed out that market rates determined what was appropriate and there is a cost to being nimble and playing catch-up. To be sure, levels of reactive transparency have gotten out of hand most everywhere – and the worst examples were showcased as endemic of a culture of greed and a near total absence of control.

The entire episode brings to mind the musings of Jane Jacobs with respect to industry and government. Through a moral dialogue on the foundations of society, she pointed out the latter functions according to a “guardian” culture based upon the upholding of social justice and rules of fairness, whereas the former is driven by a “commercial” ethos embracing risk. Guardians are thus stable and methodical; for commercial types actions trump process.

Jacobs warned of monstrous hybrids when both syndromes collide within a common organization that invariably becomes unworkable as a result. The e-health agency of Ontario is a case in point: pursuing a public mission with a private sector mentality. Government apparently has understood this lesson well, reasserting central agency controls on all such agencies (including the provincial lottery corporation, another candidate for faulty hybrid status).    

End of story. Not quite.

Without effective public-private collaboration, e-health will go nowhere. This lesson is true most everywhere. Much of the Olympic infrastructure in B.C. is being built on time and on budget through innovative and reasonably transparent partnership schemes (as the Opposition, Auditor General and media have been keeping close watch). While the municipal bail out of the athlete’s residence in Vancouver denotes a counter example of poorly managed risk and the impacts of the global financial crisis, in general partnering has held up well.

Indeed, the recent (and, in some parts of the world, ongoing) financial crisis further augments the importance of virtuous hybrids of commercial and guardian functions. The way to avoid massively over-regulating financial markets (i.e., bolstering the guardians) as some would like is for industry to become better at self-regulation and at working in concert with public authorities. Many observers believe the relative health of the Canadian banking sector in comparison to the U.S. is owed to achieving such a balance.

Back in Ontario, the e-health scandals are hardly indicative of the need for a complete reversion to guardian practises: i.e., departments or agencies micro-managed by risk averse central agencies, themselves hostage to the crisis command and control centre otherwise known as the Premier’s Office.  Instead they are indicative of the need for better corporate governance.

While the government deserves ultimate accountability for spending and mismanagement in the e-health realm, the board of directors should have been much more in tune with the optics and dangers of reactionary disclosure in an increasingly open world. The board chair rightfully resigned, and as the Premier’s hand-picked appointment the consequences are invariably political.

Yet there is another layer of corporate governance, unique to the public sector, and largely missing in action (except in after the fact exposure): the legislature. Involving elected officials in agency boards – and in choosing board members – would provide an important measure of public oversight, rebalancing commercial and guardian interests in guiding organizations with a public interest mission.

In the case of e-health, an additional advisory board comprising citizens would further assist in sensitizing the public to the difficult decisions and choices that lie ahead. With such mechanisms in place, greater freedoms should then be bestowed upon agencies to manage for performance, to report routinely and proactively, and to be held responsible for results.

The over-arching lesson for e-health is the same for most all aspects of effective public sector reform: command and control must give way to new corporate governance models that support collaboration and innovation in a responsible manner. In this regard, traditionalists cry for simplicity; realists embrace complexity. One thing for certain: it will not be the Ministry of Health that builds 21st century health care.


Jeffrey Roy is Associate Professor in the School of Public Administration at Dalhousie University (roy@dal.ca).

About this author

Jeffrey Roy

Jeffrey Roy

Jeffrey Roy is Professor in the School of Public Administration at Dalhousie University’s Faculty of Management. He is a widely published observer and critic of the impacts of digital technologies on government and democracy. He has worked with the United Nations, the OECD, multinational corporations, and all levels of government in Canada. He has produced more than eighty peer-reviewed articles and chapters and his most recent book was published in 2013 by Springer: From Machinery to Mobility: Government and Democracy in a Participative Age. Among other bodies, his research has been funded by the IBM Center for the Business of Government and the Social Sciences and Humanities Research Council of Canada. He may be reached at: roy@dal.ca

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