Document 3:15 (2025−2026) / Published The authorities’ efforts to ensure efficient use of resources in the public sector
Almost two-thirds of government agencies report that they have little incentive to put forward proposals for savings and cuts during the budget process.
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The PDF is in Norwegian
Brief background
- From around 2030, an imbalance will emerge between revenue growth and expenditure growth in the fiscal budget. This imbalance will intensify over time.
- A decline in the working-age population may lead to labour shortages.
- There is a need to make public services more efficient and less labour-intensive in order to address these future challenges.
Overall assessment
It is unsatisfactory that:
- There are shortcomings and areas for improvement in the policy instruments designed to facilitate the efficient use of resources, and little attention is paid to possible reductions in appropriations. There is also a lack of systematic information on the relationship between the use of resources and outcomes in the central government sector.
- The Ministry of Local Government and Regional Development lacks a mechanism to assess the legal governance of the local government sector as a whole.
Conclusions
- The decision-making basis in the budget process has potential for improvement. The absence of clear guidance early in the process can make it difficult to establish comprehensive and long-term priorities.
- The government ministries lack systematic information on whether the resources within their areas of responsibility are being utilised effectively
- Efforts to collect, standardise and make available data from government agencies on the efficient use of resources have been ongoing for some time. However, adequate arrangements are still not in place
- Digitalisation and administrative development are key policy instruments for improving efficiency in the public sector, but there are challenges in realising the benefits
- Government agencies refrain from implementing major efficiency measures because they cannot find the financial leeway to do so in the short term
- There is potential for increased use of shared services, which could yield efficiency gains for the central government
- The scope of the central government’s legal governance of the local government sector is extensive and has increased over time
- The central government administration has no mechanism for assessing the legal governance of the local government sector as a whole, which may reduce efficiency in the sector
Recommendations
We recommend that the Ministry of Finance, as part of the ongoing efforts to improve the fiscal budget process:
- facilitate early guidance on priorities in budget preparation
- facilitate a clear weighing of the advantages and disadvantages associated with phasing out or streamlining existing measures against the scope for funding new initiatives
- strengthen the mechanisms for dealing with cross-sectoral issues, so that the decision-making basis better supports comprehensive and long-term priorities
We recommend that the Ministry of Finance and the Ministry of Digitalisation and Public Governance:
- ensure that more systematic information is obtained on the relationship between the use of resources and outcomes in the central government sector
- facilitate better utilisation of funding schemes, so that government agencies are better equipped to implement digitalisation and efficiency measures
- enable government agencies to realise more of the benefits of efficiency measures, particularly digitalisation measures
We recommend that the Ministry of Digitalisation and Public Governance continue its work on further developing shared services and assess how the use of shared services can contribute to more efficient use of resources.
We recommend that the Ministry of Local Government and Regional Development, in consultation with other government ministries, strengthen the coordination of the central government’s legal governance of the local government sector.