The potential of public administration reform to enhance Government’s response to the economic crisis. Conference on Administrative reform, March 19, 2009 The global financial crisis and economic downturn has called for an increased role of the government sector. Not only in Russia, governments worldwide face the challenge of developing effective policy responses in the face of increased economic pressure. Better governance and improved public sector management are particularly significant issues in the current economic atmosphere. Tighter fiscal constraints have intensified the Government’s interest in improving the use of public resources, and on improving its technical efficiency in the delivery of public services. Fiscal discipline, to be supported through more efficient and strategic management decision processes and reforms related to the role of the state in the economy, is critical in the current atmosphere. We are very encouraged to see that, despite the urgency of taking prompt anti-crisis actions, the Russian Government has not diverted its attention away from the ongoing public administration reform agenda. The Russian Government fully understands shortcomings in public sector management have the potential to negatively impact Russian private investment, growth and poverty reduction efforts. Therefore, we see that both the federal and sub-national authorities are intensifying their efforts in this area. This is exemplified by today’s attendance of high level representatives of over 70 regions as well as most federal executive authorities. Let me take this opportunity to confirm that the World Bank will continue to fully support the Russian government’s ongoing efforts in public administration reform at this difficult time and beyond. In cooperation with the UK Department for International Development (DFID), the World Bank has been supporting public administration reform in Russia since 2004. The World Bank is uniquely placed in that its staff has experience working in countries all across the globe. This experience and global knowledge has been brought to Russia on request of our counterparts. Later in this conference, for example, we will have a distinguished expert from Brazil, whom the Bank has invited on the request of the Russian Government, to share his country’s experience of citizen service centers. Efforts in public administration reform are already bearing fruit, including the strengthening of federal and sub-national authorities’ capacity to respond to the crisis quickly and effectively. For example, the Government’s progress in using performance management concepts as a decision-making tool can assist the Government in selecting appropriate anti-crisis measures. Systematic monitoring of the effectiveness of anti-crisis measures and a stronger linkage with the budget process should help ensure that scarce budgetary resources can be reallocated to activities with the most impact in a timely manner. At this time more than ever it will be very important for all responsible Government bodies to work closely together in a fully coordinated manner. Likewise, ongoing initiatives to improve public service delivery have much potential to help the anti-crisis policy responses to make a timely impact on Russian citizens and businesses, whose welfare and livelihoods are at risk. Initiatives such as the Multi-Functional Service Centers can make vital public services such as employment and social protection programs more accessible to citizens who need them, especially at this difficult time. At this time it is also especially crucial to take prompt action to ease the operation of businesses, especially small and medium-sized firms, whose survival is at risk. At the same time, support for small business development, which many regional governments have recently launched, can indeed help mitigate the impact of the crisis by encouraging greater employment through entrepreneurship. Such support need not be limited to financial support for businesses; steps to facilitate small firms’ interaction with the state authorities can be equally important. International experience suggests that reducing administrative barriers to business activity allows business to spend less money and time on meeting administrative and regulatory requirements. For example, in Greece, where some of you have visited as part of our program last year, the issuance of business licenses through one-stop-shop service centers has reduced business costs by 80 percent. This has been proven to result in more efficient allocation of resources to the real sector of the economy. At the same time, such initiatives for streamlined service delivery to citizens and businesses result in substantial savings of public expenditures, which continue in the long run. Once one-stop-shop service centers are operational, the cost of service delivery declines [as such centers have the capacity to handle an increasing range of services with essentially the same level of resources]. For example, in Greece the cost of service delivery has dropped by 44 percent (in nominal terms) per administrative procedure in the past 5 years, even though the number of services provided by citizen service centers has increased. Finally, efficient service delivery mechanisms such as one-stop shops help build public confidence in public authorities. Increased confidence on the part of businesses can encourage economic activity to come out of the grey sector into the formal economy, thereby boosting government revenues. Last but not least such transparent, streamlined service delivery mechanisms reduce opportunities for corruption and enhance citizen satisfaction with public services. This is an important element in any governance-related effort. |
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