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Evaluation of Policy Initiatives: Transparency and Accountability

Presented to:Anti-Corruption Policy: Can International Actors play a Constructive Role?Bellagio, June 13-17, 2011

Presented by:Francesca RecanatiniSenior EconomistPREM Public Sector GovernanceWorld Bank

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Outline

Setting the stage – a few illustrations Framing the problem An alternative approach Lessons learnt and remaining

challenges (for local and international actors)

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Setting the stage…

In a low-income, democratic country in Latin America, top political leaders paid and accepted bribes from an intricate network, spanning all aspects of state and society. Through the network, the leadership controlled judiciary, legislature, and media.

Oligarchs in a country in northern Africa have divided the economy into lucrative monopolies, through government supported restrictions on competition. Civil society is weak.

The President of a resource-rich country in Central Asia accepted millions of dollars in bribes, placing them abroad in a major financial center. There are few checks on executive power.

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Setting the stage, cont. An African country has signed a peace agreement

after a decade of conflict. Formal institutions (especially local ones) are largely absent. Capacity is limited. Power is highly concentrated – a few leaders control allocation of land and awarding of public contracts for reconstruction. Nepotism and patronage are widespread.

In a low-income, democratic country in Africa, businesses finance political parties in exchange for preferential treatment. Petty corruption is widespread. Efforts to combat corruption stop prior to elections, out of fear that party financing will be cut off.

A chronically under-funded military in a country in East Asia resorted to self-financing, establishing commercial enterprises and foundations. Generals enrich themselves by sitting on boards.

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Emerging “features” of the “corruption” challenge

In practice, an heterogeneous challenge Different country’s reality (political,

institutional and cultural) Different forms of corruption Different level of skills and resources

It involves diverse actors and stakeholders (local, national and international)

It requires a significant re-allocation of powers and rents

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How to address this challenge?The emerging policy should… Be country specific Ensure and sustain coordination and

collaboration among different actors Have both short term and a medium

term vision Promote local capacity building Monitor progress and adjust to new

circumstances

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Selecting an approach

Official request from Government

Yes

Sector-specific engagement with government

GAC Diagnostic Surveys Approach

No

Selective engagement with alternative actors/ players

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A possible approach: Governance and A-C Diagnostic Surveys

A participatory process to identify governance challenges and build local capacity

Key features: Medium/long term partnership between multiple

actors for design and implementation Mechanism to facilitate feedback from different

stakeholders (focus groups) Multiple sources of data (from households, firms

and public officials) focused on experience Rigorous technical implementation Local institution implements

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What are the likely outcomes?Unbundled evaluation of corruption – administrative, state capture, bidding, theft of public resources, purchase of licenses, nepotismIdentification of weak and strong institutionsAssessment of the impact and costs of corruption on different stakeholders

To what extent has this approach helped shape public sector reforms?Only when paired with political will, donor coordination and (true) medium term vision

Lessons learnt

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Lessons learnt, cont.

What are the advantages and disadvantages of this approach?Pros: Greater local capacity, consensus and ownership that can ensure sustainability of reform process; “south-south” knowledge sharing (Costa Rica, Zambia, Mozambique, Haiti)Cons: Time consuming and costly; challenging to coordinate many different actors, especially international ones; unforeseen political changes

How do we “reconcile” aggregate indicators with national assessments?

Two sides of the same coin with different objectives. Key => the two approaches complement each other

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Lessons learnt, cont.

Who should be involved in measuring?

It depends on the country reality. Our experience: the country as a whole. But donors, INGOs can play a very important role (Sierra Leone, Mozambique, Haiti). NSOs should also be involved to promote sustainability (Peru, Paraguay)

How can we help various stakeholders make appropriate use of these tools?Local focus, local capacity building, participation, and learning by doing (Paraguay, Peru, Sierra Leone)

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THANK YOU!

Q & A

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Addendum

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The role of governance assessments

Will and PoliticalLeadership for

Institutional ReformsOn governance

Strategy and Action Plan

Governance assessment:- Identification of severe obstacles- Vulnerability of each institution- Identification of priorities

Empirical Tools and Data Capacity building and

coalition building

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0% 15% 30% 45% 60% 75% 90%

% of public officialsreporting frequentpublic funds mis-

management

% of public officialsreporting frequent

purchase of positionsin their institutions

% citizens reportingbribes used frequently

to obtain publicservices

Sierra Leone(2003) Guatemala(2004) Zambia(2003)

Paraguay(2005) Mozambique(2004) Madagascar(2005)

Country Diagnostic Results

Extent of corruption, (Selected Countries ‘03-’05)

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Corruption imposes barriers to households to access basic services, Sierra Leone 2003

Cost of Corruption:discouraged users by service

0% 5% 10% 15% 20% 25%

Municipal and District Councils

Public education services

Public health services

Sierra Leone Roads TransportAuthority (RTA)

Sierra Leone Housing Corporation(SALHOC)

Proportion of head of households reporting that they decide to not conduct procedures with these institutions because they couldn't pay the unofficial costs

Sierra Leone Housing Corporation

0% 10% 20% 30%

high incomemiddle incomelow income

0% 10% 20% 30%

Sierra Leone Roads Transport Authority

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Mechanisms to participate to the policy process

0

10

20

30

40

50

60

Association/NGO Direct tie topublic officials

Do not participate

Southern Northern Eastern Western

% of households reporting to use the following channel to participatein the policy process (Sierra Leone, 2003)

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Bribes to win contracts with Government, (as reported by public officials, 1999-2005)

0% 10% 20% 30% 40% 50% 60% 70% 80%

Colombia(2001)

Guatemala(2004)

Honduras(2001)

Paraguay(2005)

Sierra Leone(2003)

Zambia(2003)

Mozambique(2004)

% of public officials reporting that the practice is frequent

Executive Local Governments

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0 10 20 30 40 50 60 70 80 90

Min. of DefenceMin. of Development

Min. of InformationNat. Commissions

OthersPara-statals

Min. of FinanceMin. of Local Govt.

Min. of Social WelfareMin. of Education

Min. of JusticeS.L Police

Min. of AgricultureMin. of Health

% of Public Officials that said irregularities/(misappropriations) are frequent

Public funds are mismanaged by agency(as reported by Public Officials, Sierra Leone, 2003)

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Agency-level Indicators

Using responses from public officials Public officials are employees of each

agency Public official’s responses are re-scale

(from 0 to 100) and then aggregated by agency using factor analysis technique

0 always meaning the lowest level of quality of governance, corruption, access or service performance

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South North East West SIERRA

Prov. Prov. Prov. Area LEONE

Overall corruption 22 32 35 33 32

Corruption in budget 35 43 48 39 40

Corruption in public contracts 18 35 29 33 30

Corruption in personnel 39 44 55 53 49           

Accessibility for poor 85 74 87 74 78

Audit Mechanisms 55 59 66 58 58

Enforcement of rules 70 67 80 73 71

Politicization 21 34 22 34 32

Quality of rules 62 62 70 61 63

Resources 54 51 47 55 52

Transparency 51 55 53 51 55

Citizen voice 70 59 65 66 66

Meritocracy 66 65 70 69 68

Governance and corruption indicators by province

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Sector Level Diagnostic Surveys: Key questions (e.g. transport)

Institutional structure of the sectors under study How does transport work in Mauritania? What needs to happen at the

implementation level? Possible vulnerabilities

Internal to the sector: transporters, officials and regulations. External to the sector: linked to banking sector? International issues?

Mechanisms of poor governance Is it difficult to get a trucking license? Are bribes required to cross

borders with freight? Do civil servants have necessary capacity? Are rules clear?

Costs of poor governance What price do transporters and customers pay to ‘facilitate’ antiquated or

inadequate processes? What is the mark up on contracts due to fraud? How many roads are narrower than they should be because of corruption?

Who are the major players and what are their policy needs? Potential entry points for reform? Who plays a role in the reform

process? Who can be a potential deal breaker? How can we understand the political landscape to ensure policy outcomes are politically viable?

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Methodological Approach

Sector LevelGovernance Assessment

Tools & Info

Desk Study: history,

sector structure, current context

In-Depth Interviews

3 Surveys(Experience Based)

Audit & Project Data

Cross-Sector Team(PREM, WBI, SDV,PDS, Procurement)

Country OwnershipPolitical Economy Assessment

Team Capacity Needs

Transparent Process

Local PartnershipGov’t + Civil Society

Donor Partnership w/Active Donors

Partnershipw/ Bank Country Team

Broad PeerReview

Process Needs

Outcomes:

1. Governance Baseline

2. Agency Specific Indicators

3. Public Dissemination &

Participatory Policy Process

Iterative process: 8-12 months

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Innovative features

Sector-specific focus: Apply methodology and solutions to country and sector realities

Mixed methods: Focus groups & In-depth Interviews Surveys (households, businesses & civil servants) Desk study Project cost data

Active participation of civil society and government to contribute to policy making process.

Close collaboration with donors’ colleagues. Active links to on-going sector projects

WB transport and port projects EU transport ministry aid project