1

Fighting Corruption in Public Services:

Chronicling Georgia’s Reforms

The World Bank2012

2

Objective of the book

1. To chronicle Georgia’s anti-corruption reforms in public services

2. To understand the ‘how ’ of these anti-corruption efforts

3

Framework for Analysis….

Case study approach: looking at 8 sub-sectors 1. patrol police 2. power supply 3. tax collections4. customs 5. business regulation6. public and civil registry7. university entrance examinations8. municipal services

4

…..Framework for Analysis

Each case study is structured in 3 parts: The state of affairs in 2003The post-2003 anti-corruption reformsResults

Senior policymakers were interviewed on the ‘how ’ of anti-corruption reforms

World Development Report 2004 framework was used to analyze accountability arrangements between the government, service providers, and citizens

5

Aggregative Scorecard2003 2010-11

% of people reporting paying a bribe (Transparency International Corruption Barometer Survey)

7 2

Rank in Corruption Perception Index (Transparency International)

124 68

Ease of Doing Business rank (World Bank Doing Business Surveys)

118 16

% of Responses that Corruption is Most Problematic Factor for Doing Business (World Economic Survey)

… 1.8

6

Very Low Prevalence of Unofficial Payment(2010 data, % of population surveyed)

Educ. (Prim., Sec.)

Road Police

Official Docs.

SS, Unem. Ben.

Civil Court

sGeorgia 5 1 1 3 3

Former Soviet Union

23 30 20 17 20

New EU Members

4 7 3 3 5

EU-5 (UK, France, Germany, Italy, Sweden)

1 0 1 1 1

Source: EBRD-World Bank, 2011, Life in Transition 2

7

Sectoral ScorecardsPatrol Police Tax Collections

2003 2011

Bribe to become a police officer

$2K-20K

None

Ratio of police officers to population

1:21 1:89

Bribe to obtain a Driver’s License

About $100

None

2003 2011

TaxCollectionsas a % of GDP

12 25

No. of taxes(# of taxpayers)

22(80,000)

5 (252,00

0)

E-filing (%) 0 70-80

8

Sectoral ScorecardsCustoms Power Supply

2003 2011

Bribe to become a customs official

$5000(at Red Bridge)

0

No. of import tariffs/bands

16 3

Average Tariffs

20 < 2

2003 2005-11

Average Daily Service(hours)

7-8 24

Collection rates (%)

22 100

Power generation (TWh)

6.9 10

9

Sectoral ScorecardsDeregulating Businesses

Public and Civil Registries

2003-05

2011

No. of permits and licenses

≈ 900 ≈ 130

Dealing with Construction Permits – Rank

42 4

Bribes to get permits or licensees

Common

None

2003-05 2011

Registering Property – Rank (no. of days)

16

1

Bribes to get a job

$5,000-$25,000

None

Public perception of corruption (%)

97 1

10

Sectoral ScorecardsUniversity Entrance Exams Municipal Services

2003 2011Bribes for University Entrance

$8K - $30K

No bribes;competitiv

e selection

Number of entrance exams

Many; unique

for each university

One common

exam

Satisfaction with admissions

Very low High

2003 2011Average Water Daily Service

4-6 hours 16-18 hours

Collection Rate (%)

20 75

Annual LSG Budget (GEL)

400m 1.7 b

11

Ingredients for Success? Ten Tenets

1. Exercise Strong Political Will

2. Establish Credibility Early

3. Launch a Frontal Assault

4. Attract New Staff

5. Limit the Role of the State

6. Adopt Unconventional Methods

7. Develop Unity of Purpose and Coordinate Closely

8. Tailor International Experience to Local Conditions

9. Harness Technology

10. Use Communications Strategically

12

1. Exercise Strong Political Will

Campaign slogan of ‘Georgia without corruption’

Strong presidential leadershipOver 90 percent popular support in the

electionsSense of urgency – short window of

opportunityShared ideology of a diminished ‘role of the

state’

13

2. Establish Credibility EarlyEnforced ‘zero tolerance’ for corruptionEstablished a ‘virtuous cycle’ of reformsDestroyed ‘symbols of corruption’: thieves-in-

lawShowed ‘equality before law’Make necessary legal changes

14

The Georgian Virtuous Reform CycleReplenish

‘Windows of Opportunity’

Political Will and

Vision

Flexible Strategy

Pragmatic

Design

Rapid Implementati

on

Quick Results

15

3. Undertake a ‘Frontal Assault’Introduced holistic, interconnected reforms;

no ‘piecemeal’ approachEstablished clear sequencing: started by

enforcing law & order and improving tax collection then moved to reforms that benefited the most people in the shortest possible time

16

4. Attract New StaffRenew staffing: Bring in ‘new blood’- recruit

new, dynamic staff; removed corrupt, inefficient staff

Developed a strong team with shared valuesProvided clear incentives - good

remuneration and employment conditions, with clear accountabilities

Created a new culture of public service: putting the citizens first

17

5. Limit the Role of the State Limit the interface between the citizens and

the stateEncouraged private initiativeDeregulated businessesApplied the ‘guillotine’: eliminate

unnecessary or inefficient public agenciesBalanced institutional development with the

capacity of the stateMicroeconomic incentives matter

18

6. Adopt Unconventional MethodsImprovise: first-best solutions may not work

or be politically possibleTook decisive and quick actionsEnsured direction of movement was correct,

even if specific measures may not be perfectInitially focused on prosecutorial methods

19

7. Have Unity of Purpose and Coordinate Closely

Have a core team of policymakers, with shared common values and vision

Ensured intensive coordination at the cabinet of ministers

Established high level commissions on sectoral reforms

Ensured timely decisions and actions

20

8. Tailor International Experience to Local Conditions

Drew from international experience but adapt to local conditions (e.g. anti-mafia legislation, plea bargaining, business deregulation)

Learned from international successes as well as failures

Helped to have policymakers who have seen how things are done differently in other countries

21

9. Harness Technology

Computerization aided business simplification and anti-corruption

Technology helped to reduce the interface between the citizens and the state

Used simple IT solutions, consistent with local capacities

Technology helped establish time bound service standards

22

10. Use Communications Strategically

Leadership needed to maintain close contacts with the people

Constantly used political calculus to inform anti-corruption reform design and implementation

Used regular public polling to inform decision-making

Used media to expose cases of corruption and publicize important actions

23

The Accountability Framework

Government

ProvidersCitizens/Firms

24

The Right Balance?Prosecutorial Actions

Institutions

Time

• Need to strengthen the system of checks and balances on executive power

• Strengthen public institutions for service delivery

25

Are Georgia’s Reforms Replicable to Other Countries?

Public services can be cleaned upMany reforms are replicable with adaptation to

local conditionsThe specific design, pace, and sequencing of

the ‘how to’ depends on country circumstances

26

THANKS

www.worldbank.org/georgia/georgiabook