CONTEMPORARY CROATIAN PUBLIC ADMINISTRATION ON THE REFORM WAVES

1. CONTEMPORARY CROATIAN PUBLIC ADMINISTRATION ON THE REFORM WAVES Professor Ivan Koprić Faculty of Law, University of Zagreb

2. Political and administrative dynamics The new Croatian Government (July 2009) was elected by the Parliament (Sabor) from the same political coalition - Jadranka Kosor became the first female prime minister – former PM, Ivo Sanader, resigned at the beginning of July 2009 Establishment of the Ministry of (Public) Administration (my proposal, pp. 20, 27!) Genuine political processes as a source of environmental uncertainty for public administration

3. Framework for Comparative Analysis Comparative experiences as a basis for learning Country specific elements (idiosyncrasies) as a basis for specific institutional pace of development Issues to be compared: Outline of particular administrative system The phases in its development The main problems Current reform efforts Perceived environmental influences Possible future development Theoretical grounds: neo-institutionalism (normative and historical) and organisation theory (complexity, environment complexity, interdependence ...) PA - composition, technical complexity (tasks, internal dynamics), complex external global and regional influences, interdependencies of internal and external processes, value complexity (democratic, legal, social, economic, ecological values) Administrative doctrines (NPM and GG) Reform strategies

4. Croatia Independence at the beginning of the 1990s Self-management legacy (public interest, public participation, social welfare) War and rebellion (1991-1995) and the period of reconstruction Economic transition (from social ownership economy to free market economy) Privatisation of social ownership as grounds for economic way of thinking, neo-liberalist tendencies and managerial doctrine in thepublic sector Europeanisation efforts have raised the issue of good governance

5. Public administrative system: composition and the main tendencies State administration – organised as the system of classical administrative organisations like ministries; reorientation to the “core-business” (smaller organisations concentrated on public policies, drafting regulations, authoritative decision-making, inspections, and similar tasks) Territorial self-government (local and regional); harmonisation in wider European context; decentralisation and new legitimacy; wider responsibilities: from administrative tasks to the support of economic and social development Services of general interest (economic and non-economic, i.e. social, health, etc.); new European regulation of the services of general economic interest, especially in network industries; European social model Overall Europeanisation within broader globalisation context

6. Public sector values are integrating governance system are crystallized through political processes of amalgamation of interests and ideologies Public administration should gain overall legitimacy in its social milieu – that is why it has to adapt to complex value orientations. Value heterogeneity: Continental European space: stress on the political, legal, and social values (Hegel: a state is God’s walk on Earth; Greek democracy and Roman law tradition) Anglo-Saxon space: stress on the economic values and pragmatism (brutal economic and social situation) Within the public sector: different situation in transport sector, finances, local self-government … during historical development: political – legal – social – economic - ecological

7. Types of public sector values Political (democratic): accountability, publicness, transparency, responsiveness, political decentralisation, openness, legitimacy, flexibility (user-friendliness) Legal: the rule of law, legality (organisational, substantive, procedural, with regard to competence), legal responsibility (for damage caused by illegal functioning, or disciplinary responsibility), legal certainty, protection of fundamental rights and freedoms, equality, impartiality, due process, court supervision Social: social justice, solidarity, social sensibility, care, charity, sympathy, mercy, assistance to the citizens, cultural diversity, respect of national, sexual, and other minorities Ecological: protection of natural environment, protection of biological diversity, careful management of natural resources, life in harmony with nature Economic: the three Es (economy, efficiency, effectiveness), quality, market-orientation and private sector-orientation, competitiveness, entrepreneurship

8. Strategies for administrative change Pollitt and Bouckaert (2000; 2001): Maintain. To preserve and incrementally improve (up-grade) classical, Weberian model of public administration as rational, well-organised, monocratic organisation with fine tailored hierarchy, professionalism, impartiality, legality, and standardised bureaucratic procedures. Modernise. More fundamental changes in structures and functioning (from procedures to results; output budget orientation; autonomous executive agencies; from appointment acts to employment contract, etc.) Marketize. Introduction of market principles and mechanisms in the PA system (internal market – British NHS and competition of hospitals; charging real market prices; consumer-orientation) Minimize. Shrinking the public sector by privatisation, contracting out, public-private partnerships, civil (voluntary) sector involvement, etc.

9. The New Public Management Imposing economic values and private sector techniques into the public sector Stress on economy and efficiency; ideology of state failure; inclination to private entrepreneurship and free market economy From the 1980s, grounded in neo-liberal ideology Conservative political actors in Anglo-Saxon countries New Zealand, Australia, Canada, UK, USA Significant role of international organisations (IMF; WB; OECD) Attack on welfare state; reaffirmation of capitalism class structure; neo-colonialism

10. Structural and functional measures and effects a) Structural Reduction (lean state; privatisation, budget reduction, reduction of the level of social rights, etc.) Forms of private and third sector participation in public affairs (PPP, outsourcing, concessions, etc.) Loosening structural ties (fragmenting state; agencification, decentralisation, greater autonomy of public sector organisations, etc.) Problems: accountability, coordination, strategic policy, ethics, local self-government, costs b) Functional Marketisation of the state; public market Competitiveness Real prices Services of general economic interest (liberalisation and privatisation) Deregulation De-bureaucratisation (removing procedural obstacles to private sector subjects and citizens; management by results) New budgetary solutions; internal and external audit, etc.

11. NPM – Ideas and effects with regard to personnel; social consequences Personnel More mechanical measures (reducing the number, reduction of salaries, flexibilisation, private sector managers engagement, greater autonomy of public managers with regard to remuneration, payment and career system, etc.) Human potentials development (education, in-service training, organisational culture building, ethics, orientation towards results and citizens’ needs) Problems: instability, insecurity, organisations as psychic prisons, unsuccessful organisations, consumerism, etc. Social consequences Reinvigorating capitalism (state failure) Crisis of welfare state: poverty and lower level of social services, unemployment rate is increasing Democratic deficit: weakening democratic legitimacy of the state Anomy (crime, social conflicts, disregarding legal regulations) Positive effects?

12. Good Governance NPM criticisms during the 1990s followed by building a new set of ideas on a bit different value base The role of international organisations: OUN; OECD; EU Still under construction and stabilisation European Governance: A White Paper (Brussels: COM (2001) 428) (governance based on proportionality and subsidiarity); fundamental principles: Openness Participation Accountability Effectiveness Coherence The stress is on the role of citizens, civil society, and local self-government UNDP: combination of efficient and democratic governance OECD: Citizens as Partners: Information, Consultation and Public Participation in Policy-Making, 2001 Increasing administrative and policy capacities + legitimacy strengthening

13. Croatian public administration development I. 1990-1993 – Establishment phase Semi-presidential system Considerable new parts of state administration (new ministries, etc.) War Politicisation; poor professional standards; hidden lustration II. 1993-2001 – Consolidation phase (war till 1995) Etatisation and centralisation A number of poor reorganisations Introduction of new local governance system Very slow democratisation First Law on State Civil Servants in 1994 III. 2001-2008 – Europeanisation phase First political change after 1990 (coalition Government); parliamentary system Democratisation, decentralisation, attempts to raise professionalism (second Law on State Civil Servants in 2001; third one in 2005) Stabilization and Association Agreement (2001); candidate status in 2004; accession negotiations IV. 2008 – Modernisation phase? The State Administration Reform Strategy

14. Main problems I. Orientation Strategic planning Public policies Better regulation and regulatory impact assessment II. Motivation Politicisation Mechanisms of motivation Professionalism and administrative education system Administrative culture III. Implementation Legal standards Administrative ethics Bureaucratic resistances Reducing managerialism and state’s capture

15. Reform efforts Reform Strategy Decentralisation Local and regional development Many new reform projects New LGAP (administrative simplification) Administrative justice reform Access to public sector information Functional review HRM system National minority representation In-service training System of administrative education

16. State Administration Reform Strategy Adopted by the Croatian Government in March 2008 as part of EU accession efforts (www.uprava.hr) Structure: Executive summary State administration we want (Vision and goals of modern administration) The main results in the reform of political system and state administration The main areas and directions of state administration reform Implementation of strategic measures Leadership, monitoring and evaluation of results

17. State Administration Reform Strategy - goals Increasing efficiency and economy in the state administration system Raising the quality of administrative services Openness and access to state administrative organisations The rule of law Increasing social sensitivity inside state administration and in relations with citizens Rising ethical level and reducing corruption Modern ICT implementation Joining the European Administrative Space *accompanied by 29 indicators

18. State Administration Reform Strategy – main areas and directions Structural adaptations of state administration system: from structure to good governance (3 directions; 13 activities) Increasing the quality of programmes, laws and other regulations: better regulation (4 directions; 14 activities) System of state servants: modern civil service (4 directions; 10 activities) Education and in-service training of state administration: knowledge, skills and competences (2 directions; 8 activities) Simplification and modernisation of administrative procedures: e-administration (2 directions; 17 activities)

19. Other strategic documents Strategic Development Framework for 2006-2013 - Previous efforts: 55 recommendations for improving national competitiveness of Croatia Decentralisation strategy under preparation – failure? - Previous efforts: Decentralisation of Public Administration (2000-2003) Lack of an overall strategic document with regard to services of general interest - Sectoral documents (for example, Strategy for Development of Communal Utilities)

20. Environmental influences Domestic influences Political system Business community Civil sector Academic community Foreign influences Europeanisation Other world dominant organisations (IMF, WB, WTO, OECD ...) Changes in administrative doctrines

21. Future Croatia as a late-comer in transition and Europeanisation Optimistic and pessimistic scenarios Different possible directions of development: Conceptually straight modernisation Inertia (hesitating development) Chaotic institutional decline Proposals: Reform Strategy refinement and better reform management Sound system of administrative education (Faculty of Public Administration?) Structural measures Decentralisation Better regulation (RIA improvement included) Administrative procedures modernisation Two-level and effective administrative justice system Civil servants motivation improvement, etc.

22. Lessons learned PAR as part of the Europeanisation process is not the best solution for domestic problems (Europeanisation is only one of theenvironmental influences; the EU is one of broader institutional frameworks, not the only one) PAR should be in line with previously discussed and adopted basic national goals – otherwise it could be unsuccessful or counter-productive Three main parts of PA (state administration; local and regional self-government; public services) need different reform approaches Strong administrative body needed (Ministry of Public Administration, probably with vicePM as a minister) Laws could foster or freeze reform efforts, but cannot replace real will to make PA modern and better Policy orientation should be developed Education and training should be more intensive – capacity building State administration system, structural, personnel, human resource, financial etc. measures needed

23. Institutional challenges Good institutional structure is a necessary prerequisite for successful reforms, but other prerequisites are needed and are of equal importance (political will and support; strategic planning and policy making; educated and informed civil servants; extra-organisational expertise; financial support; reform dedication, etc.) – institutions do matter Inappropriate institutions (weak institutions or inappropriate networks of institutions …) impede positive impacts of other favourable conditions Institutions should be adapted to the specific circumstances of a country (culture, external conditions, basic state’s goals …) Certain regularities are generally recognizable and could be used for learning and suggesting proposals Significance of good and bad examples in similar and different conditions – experiential learning

24. Thank you! Professor Ivan Koprić Faculty of Law, University of Zagreb Mailto: ikopric@pravo.hr