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Fighting Corruption in Public Services: Chronicling Georgias Reforms

The World Bank2012

11Objective of the bookTo chronicle Georgias anti-corruption reforms in public services To understand the how of these anti-corruption efforts

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2Framework for Analysis.Case study approach: looking at 8 sub-sectors patrol police power supply tax collectionscustoms business regulationpublic and civil registryuniversity entrance examinationsmunicipal services3

..Framework for AnalysisEach case study is structured in 3 parts: The state of affairs in 2003The post-2003 anti-corruption reformsResultsSenior policymakers were interviewed on the how of anti-corruption reformsWorld Development Report 2004 framework was used to analyze accountability arrangements between the government, service providers, and citizens4

Aggregative Scorecard20032010-11% of people reporting paying a bribe (Transparency International Corruption Barometer Survey)72Rank in Corruption Perception Index (Transparency International)12468Ease of Doing Business rank (World Bank Doing Business Surveys)11816% of Responses that Corruption is Most Problematic Factor for Doing Business (World Economic Survey)1.8

55Very Low Prevalence of Unofficial Payment(2010 data, % of population surveyed)Educ. (Prim., Sec.)Road PoliceOfficial Docs.SS, Unem. Ben.Civil CourtsGeorgia51133Former Soviet Union2330201720New EU Members47335EU-5 (UK, France, Germany, Italy, Sweden)10111Source: EBRD-World Bank, 2011, Life in Transition 26

6Sectoral ScorecardsPatrol PoliceTax Collections7

20032011Bribe to become a police officer$2K-20KNoneRatio of police officers to population1:211:89Bribe to obtain a Drivers LicenseAbout $100None

20032011TaxCollectionsas a % of GDP12

25No. of taxes(# of taxpayers)22(80,000)5 (252,000)E-filing (%)

070-80Sectoral ScorecardsCustomsPower Supply8

20032011Bribe to become a customs official$5000(at Red Bridge)0No. of import tariffs/bands163Average Tariffs20< 2

20032005-11Average Daily Service(hours)7-824Collection rates (%)22100Power generation (TWh)6.910Sectoral ScorecardsDeregulating BusinessesPublic and Civil Registries9

2003-052011No. of permits and licenses 900 130Dealing with Construction Permits Rank424Bribes to get permits or licenseesCommon

None2003-052011Registering Property Rank (no. of days)16 1

Bribes to get a job$5,000-$25,000NonePublic perception of corruption (%)971Sectoral ScorecardsUniversity Entrance ExamsMunicipal Services10

20032011Bribes for University Entrance $8K - $30KNo bribes;competitive selection Number of entrance examsMany; unique for each universityOne common examSatisfaction with admissionsVery lowHigh 20032011Average Water Daily Service4-6 hours16-18 hoursCollection Rate (%)2075Annual LSG Budget (GEL)400m1.7 bIngredients for Success? Ten TenetsExercise Strong Political Will

Establish Credibility Early

Launch a Frontal Assault

Attract New Staff

Limit the Role of the State

Adopt Unconventional Methods

Develop Unity of Purpose and Coordinate Closely

Tailor International Experience to Local Conditions

Harness Technology

Use Communications Strategically

11111. Exercise Strong Political WillCampaign slogan of Georgia without corruptionStrong presidential leadershipOver 90 percent popular support in the electionsSense of urgency short window of opportunityShared ideology of a diminished role of the state12

2. Establish Credibility EarlyEnforced zero tolerance for corruptionEstablished a virtuous cycle of reformsDestroyed symbols of corruption: thieves-in-lawShowed equality before lawMake necessary legal changes13

The Georgian Virtuous Reform Cycle

14143. Undertake a Frontal AssaultIntroduced 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 time15

4. Attract New StaffRenew staffing: Bring in new blood- recruit new, dynamic staff; removed corrupt, inefficient staffDeveloped a strong team with shared valuesProvided clear incentives - good remuneration and employment conditions, with clear accountabilitiesCreated a new culture of public service: putting the citizens first

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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

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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

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7. Have Unity of Purpose and Coordinate CloselyHave a core team of policymakers, with shared common values and visionEnsured intensive coordination at the cabinet of ministersEstablished high level commissions on sectoral reformsEnsured timely decisions and actions

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8. Tailor International Experience to Local ConditionsDrew from international experience but adapt to local conditions (e.g. anti-mafia legislation, plea bargaining, business deregulation)Learned from international successes as well as failuresHelped to have policymakers who have seen how things are done differently in other countries20

9. Harness TechnologyComputerization aided business simplification and anti-corruptionTechnology helped to reduce the interface between the citizens and the stateUsed simple IT solutions, consistent with local capacitiesTechnology helped establish time bound service standards21

10. Use Communications StrategicallyLeadership needed to maintain close contacts with the peopleConstantly used political calculus to inform anti-corruption reform design and implementationUsed regular public polling to inform decision-makingUsed media to expose cases of corruption and publicize important actions22

The Accountability Framework

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The Right Balance?

24Need to strengthen the system of checks and balances on executive power Strengthen public institutions for service delivery

Are Georgias 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 25

THANKS

www.worldbank.org/georgia/georgiabook26

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