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36133 Public Disclosure Authorized 36133 Public Disclosure Authorized International Public Administration Reform: Implications for the Russian Federation February 2003 Public Disclosure Authorized Nick Manning and Neil Parison Poverty Reduction and Economic Management Unit Europe and Central Asia Region Public Disclosure Authorized Public Disclosure Authorized Document of the World Bank ABBREVIATIONS AND ACRONYMS CCMD Canadian Center for Management Development EBRD European Bank of Reconstruction and Development ERC Expenditure Review Committee of Cabinet EU European Union GDP Gross domestic product GIA Gallup International Association GPRA Government Performance and Results Act IMF International Monetary Fund NGOs Non-government organizations NPM New Public Management MARE Ministry of Federal Administration and State Reform, Brazil PALG Public administration and local government PPP Current international $ Vice President: Johannes Linn (ECAVP) Sector Director: Cheryl Gray (ECSPE) Sector Leader: Helga Muller (ECSPE) Team Leaders: Neil Parison (ECSPE) Nick Manning (SASPR) INTERNATIONAL PUBLIC ADMINISTRATION REFORM: IMPLICATIONS FOR THE RUSSIAN FEDERATION TABLE OF CONTENTS ACKNOWLEDGMENTS.....................................................................................................IV 1: EXECUTIVE SUMMARY ................................................................................................. 6 2: THE COUNTRIES SELECTED........................................................................................ 9 3: REFORMERS' CONCERNS – WHAT WAS BROKEN? ............................................ 12 3.1 WHAT DID THEY WANT TO DO? ..................................................................................... 12 3.2 REDUCING PUBLIC EXPENDITURE .................................................................................. 12 3.3 IMPROVING POLICY RESPONSIVENESS AND IMPLEMENTATION ..................................... 13 3.4 IMPROVING GOVERNMENT AS EMPLOYER ..................................................................... 14 3.5 IMPROVING SERVICE DELIVERY AND BUILDING PUBLIC AND PRIVATE SECTOR CONFIDENCE ............................................................................................................................................. 14 3.6 MAPPING REFORMERS' CONCERNS ................................................................................ 15 4: REFORMERS' ACTIVITIES – WHAT DID THEY DO?............................................ 17 4.1 THE GENERAL PICTURE.................................................................................................. 17 4.2 THE INGREDIENTS OF PUBLIC SECTOR REFORM ............................................................. 18 4.3 'BASIC' REFORMS – ACHIEVING OR STRENGTHENING DISCIPLINE ................................. 19 4.4 'ADVANCED' REFORMS................................................................................................... 21 4.5 CHOICES IN 'ADVANCED' REFORMS ............................................................................... 26 4.6 COHERENCE OF REFORMS.............................................................................................. 28 4.7 THE LEVEL OF REFORM ACTIVITY.................................................................................. 29 5: REFORMERS' ACHIEVEMENTS – WHAT DID THEY GAIN? .............................. 31 5.1 RESULTS ARE DIFFICULT TO DETERMINE....................................................................... 31 5.2 REDUCTIONS IN PUBLIC EXPENDITURE .......................................................................... 31 5.3 EFFICIENCY IMPROVEMENTS ......................................................................................... 32 5.4 OTHER GAINS................................................................................................................. 33 5.5 UNINTENDED CONSEQUENCES....................................................................................... 34 6: REFORMERS' TRACTION - WHY DID THEY DO DIFFERENT THINGS?......... 36 6.1 A MODEL FOR EXPLAINING REFORM ACTIVITIES........................................................... 36 6.2 POINTS OF LEVERAGE .................................................................................................... 36 6.3 INSTITUTIONAL MALLEABILITY..................................................................................... 37 6.4 MAPPING REFORMERS' TRACTION ................................................................................. 38 6.5 EXPLAINING PATTERNS OF REFORM .............................................................................. 39 7 THE CHALLENGE FOR LOW TRACTION REFORMERS: HOW TO ACHIEVE BASIC REFORMS ................................................................................................................ 40 7.1 A DILEMMA FACING LOW TRACTION REFORMERS......................................................... 40 7.2 SEIZING OPPORTUNITIES IN BASIC PUBLIC EXPENDITURE MANAGEMENT REFORMS ..... 40 7.3 SEIZING OPPORTUNITIES IN CIVIL SERVICE PERSONNEL MANAGEMENT REFORMS........ 41 7.4 SEIZING OPPORTUNITIES IN REFORMING THE ORGANIZATIONAL STRUCTURE OF THE EXECUTIVE........................................................................................................................... 42 7.5 SEIZING OPPORTUNITIES IN CHANGING THE ROLE AND POLICY LOAD CARRIED BY GOVERNMENT ...................................................................................................................... 42 7.6 LESSONS FROM LOW TRACTION COUNTRIES FACED BY THE NEED FOR "BASIC" REFORMS43 8: IMPLICATIONS FOR THE RUSSIAN FEDERATION.............................................. 45 8.1 REALISM AND MANAGED EXPECTATIONS...................................................................... 45 8.2 FIRST THINGS FIRST ....................................................................................................... 45 8.3 CREATEMORETRACTION.............................................................................................. 45 8.4 SEIZE OPPORTUNITIES.................................................................................................... 47 8.5 CREATE OPPORTUNITIES................................................................................................ 47 8.6 IN LOOKING FOR USEFUL EXPERIENCES, LOOK FOR THE LIKE-MINDED......................... 48 NOTES TO MAIN TEXT ..................................................................................................... 49 APPENDIX A: SUMMARIES OF INDIVIDUAL COUNTRY REFORM EXPERIENCES ................................................................................................................................................. 51 AUSTRALIA .......................................................................................................................... 53 BRAZIL................................................................................................................................. 54 CANADA............................................................................................................................... 55 CHILE ................................................................................................................................... 56 CHINA .................................................................................................................................. 57 FINLAND .............................................................................................................................. 58 GERMANY ............................................................................................................................ 59 HUNGARY ............................................................................................................................ 60 NETHERLANDS..................................................................................................................... 61 NEW ZEALAND .................................................................................................................... 62 POLAND ............................................................................................................................... 63 SOUTH KOREA ..................................................................................................................... 64 UK ....................................................................................................................................... 65 USA..................................................................................................................................... 66 APPENDIX B: REFORMERS' CONCERNS - METHODOLOGICAL NOTE ............. 67 REDUCING PUBLIC EXPENDITURE ........................................................................................ 67 Aggregate employment and wage bill concerns.............................................................. 67 IMPROVING GOVERNMENT ABILITY TO IMPLEMENT LEGITIMATE POLICIES ........................ 68 Patronage........................................................................................................................ 68 Employment contracts and tenure................................................................................... 68 IMPROVING GOVERNMENT AS AN EMPLOYER...................................................................... 69 Ineffective monetary incentives ....................................................................................... 69 IMPROVING SERVICE DELIVERY AND BUILDING PUBLIC AND PRIVATE SECTOR CONFIDENCE69 Perceived
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