EUROPEAN PRINCIPLES OF PUBLIC ADMINISTRATION IN

EU EASTERN PARNTER COUNTRIES:

4th Comparative Report, 2014By Estonian Centre of Eastern Partnership

Presented to the 7th Public Administration Reform Panel

Tbilisi, 16 October 2014

Public administration reform in EU context• No acquis to guide the process, countries are free to

design their governance systems• Madrid criterion for acceding countries: public

administrations need to (a) prepare for membership and (b) be able to implements the acquis

• EaP: “Rule of law, good governance, the fight against corruption … are central to enhancing the relationship between the Parties” (EU-Ukraine Association Agreement)

• All in all, public administrations of Eastern Partners are expected to align with European standards and principles

The European Principles (OECD)• Reliability and predictability (legal certainty): public

administration discharges its responsibilities in accordance with the law. General rules laid down in the law and interpretative criteria produced by courts are applied impartially and in non-discriminatory manner. Legal certainty attempts to eradicate arbitrariness in conduct of public affairs

• Openness and transparency: the conduct of public administration is expected to allow for outside scrutiny and inquiries about the decisions by the affected legal and natural persons. It thus underpins the rule of law and make public authorities accountable for their actions

• Accountability: a public administration body is answerable for its actions. No authority should be exempt from scrutiny or review by the others

• Efficiency (appropriate ratio between recourses allocated and results attained) and effectiveness (administrative bodies perform successfully in achieving goals set for them). Both acquire specific importance with regard to production and delivery of public services in an environment of fiscal constraints

Observed economies: stages of developmentSource: World Economic Forum Global Competitiveness Reports, respective years

Categories 2011 2012 2013 2014

I. Factor-driven Moldova Moldova – –

I-II Transition stage

Armenia, Azerbaijan, Georgia, Ukraine

AzerbaijanArmenia, Azerbaijan, Moldova

Azerbaijan, Moldova

II. Efficiency-driven –

Armenia, Georgia, Ukraine

Georgia, Ukraine

Armenia, Georgia, Ukraine

II-III Transition stage Estonia Estonia Estonia –

III. Innovation-driven Germany Germany Germany Estonia,

Germany

Novelties in the methodology 2014• Rationale:

To reflect countries’ progress toward more competitiveness To achieve more meaningful results

• What is new: On reliability and accountability, new indicator is introduced to measure the

rule of law: Constraints to government powers originating from legislature, judiciary, external audit, public checks (Component of the RoL Index by the World Justice Project)

One more step to to take the rising competitiveness into account: Training of personnel (in testing modus so far) – complementing the extent of market dominance as one other efficiency enhancer, key for efficiency-driven economies: companies invest more in staff development in a conducive business environment, which in turn is a result of an efficient public administration

Changing for bi-annual schedule – even years from 2014 onwards

How we measure progressEuropean principles Indicators Source

A. Reliability and predictability (legal certainty)

A1. Rule of law: constraints to government powersA2. Favouritism in government decisionsA3. Irregular payments and bribes

WJPGCIGCI

B. Openness and transparency

B1. Transparency in policy makingB2. Corruption perceptionB3. e-government

GCITIUNeGovDD

C. AccountabilityC1. CSO Sustainability index C2. Judicial independence C3. Diversion of public funds

USAIDGCIGCI

D. Efficiency and effectiveness

D1. The ease of doing businessD2. Extent of market dominanceD3. Wastefulness of government spendingDD. Personnel training (testing modus)

IFC / WBGCIGCIGCI

E. Consolidating indicator E1. Public institutions GCI

A3. Irregular payments and bribesIrregular payments are: 1 – very common … 7 – never occur

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

3.813.65

5.99

2.97 2.96

5.77 5.66

4.1

2010 2011 2012 2013 2014

Reliability and predictability• Overall trend:

Both positive and negative developments in EaP region year on year and since 2010

Broadly, South Caucasus countries have been performing better than BY, MD, UA

• Country by country highlights (selected): Georgia is the clear regional leader on all 3 indicators, but esp. on

combatting irregular payments, where the country outscores Estonia and Germany; positive trends are supported by the evidence from the economy

On a negative side, Moldova continued moving to more favouritism and, more generally, to less reliable public governance

Ukraine has shown mixed trends, e.g. improved on external constraints to government powers and combatting bribes, but remained the least advanced on the latter

B1. Transparency of policy makingGetting information on government decisions is: 1 – impossible … 7 – extremely easy

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

4.464.27

4.70

3.97

3.64

4.974.77

4.00

2010 2011 2012 2013 2014

B3. E-governmentAvailability of e-services, e-readiness (website assessment), human resource

endowment, indexes of telecommunication & e-participation

AM AZ BY GE MD UA EE DE0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

0.590.55

0.61 0.600.56

0.50

0.820.79

B3. E-government 2008 B3. E-government 2010

B3. E-government 2012 B3. E-government 2014

Openness and transparency

• Overall trends: The trend of businesses experiencing more difficulty in getting

information on government decisions persists for the 2nd consecutive year (worldwide incl. EU)

The same trend prevailed in EaP countries as well Improvements in e-governance, quite pronounced 2 years ago,

seem to have subdued in 2012-14• Country by country:

Georgia leads on corruption perception, on other indicators all EaP countries are broadly at the same level

• Comparison with the EU: The gap vis-à-vis the EU is less pronounced than on reliability

and predictability – except on corruption perception

C1. CSO sustainabilityCSO sustainability is: 7…5 – impeded; 5…3 – evolving; 3…1 - enhanced

AM

AZ

BY

GE

MD

UA

EE

1.0 3.0 5.0 7.0

3.9

4.7

5.7

4.1

4.0

3.4

2.0

2013

2012

2011

2010

2009

2008

Accountability• Overall trends:

A new and positive trend has been a stronger civil society in almost all EaP countries – notably on advocacy, financial viability, public image and relations with governments

No serious slippages across the region• Country by country:

Georgia leads on eradicating corruptive practices at public finance and streamlining judicial independence; Ukraine – regarding stronger positioning of the civil society

Moldova has managed to stop the trend to a less accountable public administration, remains nevertheless at rear in he whole region

• Comparison with the EU: Georgia has maintained comparable level with Estonia on diversion

of public funds, Ukraine’ civil society moves toward an enhanced sustainability

In general, however, the region lags behind the European standard of an accountable public administration

D2. The extent of market dominanceThe corporate activity is:

1 – dominated by a few business groups … 7 – spread among many firms

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

3.46 3.473.33

3.102.96

4.06

5.65

3.80

2010 2011 2012 2013 2014

Efficiency and effectiveness• Trends in the region and country by country:

Competition protection has shown results in Moldova and Georgia, whilst Armenia lost accomplishments of the previous years

The trend to more wasteful public spending persisted in all countries except Azerbaijan

Moldova, Ukraine and Georgia managed to improve rules of doing business, with the opposite trend registered in Belarus, Armenia and Azerbaijan

Ukraine’s public spending has remained the most wasteful over the whole observation period, market dominance increased in 2014 for the second consecutive year

• Comparison with the EU: Georgia keeps up the leading position on doing business Contrary to the previous-year development, South Caucasus

countries lost momentum in consolidating public spending and the gap toward the EU widened

MAIN FINDINGS 2014• Except Georgia, the EaP countries failed (again) in

approximating the European principles of public administration

• Highlighting improvements on civil society and e-governance

• Georgia has been improving steadily since 2010, the change of the government does not seem to have reverted the reforms

• Georgia’s followers, Armenia and Azerbaijan, have loosened improvements – even if in different national environments

• Ukraine and Moldova did not manage to display any meaningful improvements, further development should be followed closely

• The distance to the EU levels remains long, however, Georgia has shown that this distance is not insurmountable

THANK YOU !

OTHER INDICATORS AND MEMORANDA

SLIDES

Definition of indicatorsA1.Rule of Law: Constraints to government powers (WJP)

0...1 The government powers are efficiently limited by judiciary, legislature, independent auditing, controls by the society; misconduct is punished

A2. Favouritism in govt decisions (GCI) 1…7 1 - government officials always show favouritism; 7 - government officials never show favouritism

A3. Irregular payments & bribes GCI 1…7 1 - irregular payments are very common; 7 - never occur

B1. Transparency in policy making GCI 1…7 Easiness to obtain information about changes in government policies and regulations affecting business: 1 - impossible; 7 - extremely easy

B2. Corruption perception (TI) 1…100 1 - the economy is highly corrupt; 100 - the economy is very clean

B3. E-government (UN) 0…1 Availability of e-services, e-readiness (website assessment), human resource endowment, indexes of telecommunication & e-participation

C1. CSO Sustainability index (USAID) 7…1 CSO sustainability is (7-5) impeded, (5-3) evolving, (3-1) enhanced

C2. Judicial independence (GCI) 1…7 To what extent judiciary is independent from influences of officials, citizens or firms: 1 - heavily influenced; 7 - entirely independent

C3. Diversion of public funds (GCI) 1…7 How common is the diversion of public funds to companies, individuals or groups due to corruption: 1 - very common; 7 - never occurs

D1. Ease of doing business (IFC) 1…185 Simple rating of economies on business regulations as formulated by law and practiced

D2.Extent of market dominance (GCI) 1…7 Corporate activity is: 1 – dominated by a few business groups; 7 – spread among many firms

D3. Wastefulness of govt spending GCI 1…7 How efficient is the government spending in providing necessary public goods and services: 1-extremely wasteful; 7-very efficient

Observed economies: GNI per capitaIn current U.S. dollars Source: The World Bank Atlas 2013

2009 2011 2013

Armenia 3180 3490 3790

Azerbaijan 4800 5530 7350

Belarus 5590 6130 6720

Georgia 2540 2850 3570

Moldova 1570 1990 2460

Ukraine 2840 3140 3960

Estonia 14400 15700 17370

Germany 42550 44670 46100

A1. Constraints to government powersby judiciary, law, legislature, independent auditing, non-governmental controls;

sanctions for misconductGrades from 0 (worst) to 1 (best)

AM AZ BY GE MD UA EE GE0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

0.34

0.53

0.430.41

0.80.83

201220132014

A2. Favouritism in government decisionsGovernment officials show favouritism: 1 – always … 7 – never

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

3.05 3.263.44

2.262.50

4.10

4.67

3.20

2010 2011 2012 2013 2014

B2. Corruption perceptionThe economy is: 1 – highly corrupt … 100 – very clear

AM AZ BY GE MD UA EE DE0

10

20

30

40

50

60

70

80

90

36

28 29

49

35

25

68

78

B2. Corruption perception index 2009

B2. Corruption perception index 2010

B2. Corruption perception index 2011

B2. Corruption perception index 2012

B2. Corruption perception index 2013

C2. Judicial independenceTo what extent judiciary is independent from influences of officials, citizens or firms:

1 - heavily influenced; 7 - entirely independent

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

2.923.16

3.84

1.95 2.02

5.675.88

3.90

2010 2011 2012 2013 2014

C3. Diversion of public fundsHow common is the diversion of public funds to companies, individuals or groups due

to corruption: 1 - very common; 7 - never occurs

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

3.03 3.14

4.52

2.37 2.35

4.72

5.31

3.5

2010 2011 2012 2013 2014

D1. The ease of doing businessCountries’ ranks among 189 economies

AM AZ BY GE MD UA EE DE1

21

41

61

81

101

121

141

161

50

6660

12

86

152

19 18

32

67

58

9

93

137

21 20

37

70

63

8

78

112

22 21

D1. Ease of doing business rank 2012

D1. Ease of doing business rank 2013

D1. Ease of doing business rank 2014

D3. Wastefulness of government spendingHow efficient is the government spending in providing necessary public goods and

services: 1-extremely wasteful; 7-very efficient

AM AZ GE MD UA EE DE mean1.00

2.00

3.00

4.00

5.00

6.00

7.00

3.01

3.463.20

2.58

1.93

4.29 4.18

3.20

2010 2011 2012 2013 2014

DD. Extent of staff trainingTo what extent do companies invest in staff training and personnel development:

1 – ignore; 7 – to a great extent

AM AZ GE MD UA EE DE mean1

2

3

4

5

6

7

3.403.73

3.52 3.40

3.78

4.42

5.02

4.00

2010 2011 2012 2013 2014

E1. Public institutionsConsolidating indicator: 1 – worst … 7 – best

AM AZ GE MD UA EE DE0.00

1.00

2.00

3.00

4.00

5.00

6.00

3.73.9

4.2

3.02.8

5.05.2

2010-11 2011-12 2012-13 2013-14 2014-15