The role of public auditing in delegated governance

Delegated governance is a defining feature of modern public sectors around the globe. In such settings, a variety of decentralized providers delivers public services while the accountability for service delivery remains with the administration. The management of relationships with providers has thus become a critical administrative task. The central position occupied by public audit institutions in these relationships has so far been poorly understood and largely under-researched. Our work unpacks how administrative units react to audits that identify performance and coordination issues in service delivery. Investigating delegated governance in the City of Vienna, our findings demonstrate that administrative units respond in two ways: by undertaking authoritative measures, and, to a lesser extent, by reaching out for dialogue with providers. We therefore suggest that audits not only strengthen administrative accountability but also improve relationship management in settings of delegated governance, filling the vacuum of control and communication between administrative units and service providers.