In the last twenty years the countries of Latin America, in line with the OECD and many middle income countries around the world, have been rightly preoccupied with a vision of modern techniques of public management which can deliver better, more relevant, and simply more, public services despite tight fiscal constraints.

A fundamental role of the Bank is to help governments work better in our client countries. The Latin America Public Sector Governance Unit within the World Bank provides world-class analytic and research services, as well as financial instruments that assist:

1. reforming public expenditure management and financial accountability, developing performance regimes across the public sector;

2. reforming human resource management in the public sector;

3. restructuring the public sector for better regulation, service delivery and inter-governmental relations;

4. sharing risks and approaches with private actors, employing alternative service delivery mechanisms;

5. empowering citizens through introducing demand-side reforms;

6. reforming justice sector, addressing those institutions responsible for reducing societal conflicts and strengthening the legal framework through the law-based resolution of disputes;

7. strengthening custom and tax collection agencies; and

8. facilitating the preparation process of municipal and territorial development strategies.

The Unit draws on global experiences –including the OECD (many of its staff have worked previously on large OECD public sector reforms), and fast-growing middle income countries. Its work reflects three important principles:

• Low trust in government, low fiscal capacity, poor public services, and poor income distribution are inter-related. A new "contract with the state" –a truly imaginative repositioning of the public sector as an entity that can be trusted with public funds– can deliver quality performance in exchange for increased revenues.

• The experiences of the OECD countries and other MICs are important –but selectivity matters. The OECD countries provide an encyclopedia of rich experience that will be relevant across a range of reform challenges that the Latin American countries face in trying to improve the general efficiency of their public administrations, including the agenda for fiscal discipline, basic information and accounting systems, modern human-resource management, decentralization, e-government, and so on. However, the relevance and meaning of OECD experience, or of foreign experience more generally, will depend on the particular context of the reforming country.

• Latin America has some distinctive and increasingly recognized innovations that offer a model to other countries in the region, and globally.

For more information on World Bank support to the reform of the public sector in Latin America and the Caribbean, visit:

http://www.worldbank.org/lacpublicsector

or contact the Latin America and Caribbean  Public Sector team.

Updated October, 2008