After the oil crisis in the 1970s, there was a crisis in the welfare state, thus talks began about the failure of the state and the necessity of changing the classical state administration. In such an environment, the doctrine of a new public management, which stands for economic values, was created. New public management first started to apply in Anglo-Saxon countries such as the United Kingdom and New Zealand. The paper presents public administration, public management and development of new public management, its goals, measures and effects, elements, as well as new public management in the Republic of Croatia - its historical development and problems of public administration in the Republic of Croatia. The task of public management is to achieve the stated goals with maximum efficiency and to take responsibility for the results obtained. Emphasis is put on the efficient exploitation of available resources to provide high quality services to citizens who become service consumers and end-users of their quality. The main goal of introducing a management approach to public administration was the establishment of a new management system based on the concept that the administration provides. The British model is best known. All of the reform measures taken were aimed at protecting the state. Unlike Britain, which wanted to create a minimum state for its reforms, Denmark had a clear vision since the very beginning of the reform. Denmark's reform was slow but thorough and even radical, as it ultimately led to the modernization of Danish public administration through its wide-ranging use of various new measures and market mechanisms in the public sector. The application of the new public management measures combined with the protection of the social and legal state was for Denmark the real recipe for returning to the category of one of the most developed countries in the world. The Washington model is based on a reduction in public administration costs based on minimum state funding. This implies financing only those public administration activities that are essential for providing quality services to citizens, such as communal services, social services, primary and secondary education services, concession services, health services and others at the state, regional and local level.