71373 Civic Engagement in Procurement A Review of Eight International Case Studies Table of Contents Acknowledgements 3 List of Boxes and Tables 4 Introduction 7 Summary of the case studies 7 Five Key Issues emerging from experience 8 Use of the case studies 10 Case Study One: Tracking Social Spending: Fundar, Mexico 11 Background 11 Fostering Transparency through Budget Analysis 13 References 16 Contact Details 16 Case Study 2: Civil Society Participation in Textbook Count: G-Watch at Ateneo School, Philippines 17 Background 17 Textbook Production and Delivery 17 Heightened Emphasis on Monitoring 18 Piloting Community-Based Initiatives 19 Institutionalizing Textbook Count 20 References 21 Contact Details 21 Case study 3: K-III Greater Karachi Water Supply Scheme: Pakistan 22 Background 22 What is an Integrity Pact? 22 Formalizing the Integrity Pact 23 Monitoring the Integrity Pact: Citizen’s Engagement 24 Impact: Providing a Model for Others 25 Scale up and Expansion 25 The Critical Role of Drivers of Reform 25 References 26 Contact details 26 Case Study 4: Program for Transparent Contracting: Morón, Argentina 27 Background 27 Ensuring a Successful Public Hearing 28 Integrity Pact 29 Citizens Engagement: Reaching Service Users 29 Lower Costs, Better Service 30 Impact 31 Is Political Will Essential? 31 Generic Lessons 32 References 32 Contact Details 32 1 Case Study 5: Making the Public Procurement System Work: Naga City, Philippines 33 Background 33 Challenges in Implementation and Creating an Enabling Environment 33 Citizens Engagement 34 Ensuring Quality and Objectivity 37 Drivers of Change 37 Impact 37 References 39 Contact Details 39 Case Study 6: The OPEN System: Municipality of Seoul, South Korea 40 Background 40 Issue to be addressed 40 Citizens’ Engagement 40 Social and Political Context 42 Simplifying Regulations 42 Impact of Mechanism- An Anti Corruption Culture 42 Drivers of Change 43 References 44 Contact Details 44 Case Study 7: Tracking Government Service Delivery: Public Service Accountability Monitor (PSAM), South Africa 45 Background 45 Citizen’s Engagement 46 Judging bene�ts and satisfaction level 46 Impact 47 Media Coverage 48 Constraints and Challenges in Implementation 49 Replicability and potential for scale 49 Contact Details 49 Case Study 8: Procurement Reform in Philippines: The Role of Civil Society 50 Background 50 The New Law 50 Public Bidding Checklists 52 Networking with Civil Society 52 Overcoming Challenges and Constraints 53 Looking Ahead 53 References 55 2 Acknowledgements This set of international case studies was developed by the World Bank Institute, with Mohini Malhotra and Karen Sirker as the task managers. The cases were prepared by Nomita Drall and Sheeja Nair, with direction provided by Asmeen Khan, Benjamin Powis, Joel Turkewitz, Karen Sirker and Mohini Malhotra. The World Bank Institute is particularly grateful to the institutions whose experiences have been pro�led for their insights and comments on the cases and particularly for allowing their experiences to be shared with peers around the globe through these case studies. Therefore a special thanks to Frank Mendoza, Maria Caroline R Belisario, Jorge Romero Leon, Gabriel Lara, Rocio Moreno, Adil Gilani, Jiyoung Lee, Dondon Para�na, Joy Aceron and Jay Kruse. Benjamin Powis prepared the introductory overview and compiled the �nal report. This activity was supported by the Norwegian Governance Trust Fund on “Procurement and Service Delivery: Monitoring Procurement Outcomes�, which was implemented by the South Asia Agriculture and Rural Development Unit in collaboration with the South Asia Procurement Hub of the World Bank. The overall task was jointly managed by a Team led by Asmeen Khan, Joel Turkewitz, and Benjamin Powis. Cover design by Colorcom. Cover photo by Asad Zaidi. Disclaimer: The �ndings, interpretations, and conclusions expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its af�liated organizations, or to members of its Board of Executive Directors or the countries they represent. The World Bank does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. 3 List of Boxes and Tables Box 1: Making public spending more transparent 13 Box 2: Analyzing the use of HIV/AIDS funds: Some Results 15 Box 3: Reorganizing the Tenders 24 Box 4: Implementing the Program for Transparent Contracting 28 Box 5: Anti-Corruption Initiatives 31 Box 6: Examples of Other Public Hearings 32 Box 7: The i-Governance Program 35 Box 8: Special Local Bodies established under the “Empowerment Ordinance of the City of Naga� 36 Box 9: Objectives of the OPEN System 40 Box 10: Changes in the Handling System for Multiple Stakeholders 41 Box 11: The New Anti-Corruption Index 41 Box 12: Centre for Social Accountability (CSA) 45 Box 13: How PSAM reaches its target audiences 47 Box 14: PWI Strategy in Planning a Reform Process: Key Steps for Effective Advocacy 51 Box 15: Differential Expenditure Ef�ciency Measurement 54 Table 1: Total Savings in Consultancy and Construction Contracts due to Transparent Procurement in the Greater Karachi Water Supply Scheme (Over 3 years) 26 4 Abbreviations and Acronyms ACI Anti Corruption Index AusAID Australian Government’s Overseas Aid Program BAC Bids and Awards Committee CAC Coalition against Corruption CAGG Collective Action for Good Governance CBCP Catholic Bishops Conference of the Philippines CDGK City District Government Karachi CENSIDA National HIV/AIDS Center, Mexico (Centro Nacional para la Prevención y el Control del VIH/SIDA) CIDE Center for Research and Teaching in Economics CIMAC Communication and Information on Women CSA Centre for Social Accountability CSO Civil society organization DEEM Differential Ef�ciency Expenditure Management FIDIC Fédération Internationale Des Ingénieurs-Conseils G-Watch Government Watch, an action research initiative of the Ateneo School of Government GoP Government of Pakistan GPPB Government Procurement Policy Board ICT-DEV Information and Communication Technology (ICT) Development IFAI Federal Institute of Access to Information IP Integrity Pact KW&SB Karachi Water & Sewerage Board LGU Local Government Units LoI Letter of Invitation MDGs Millennium Development Goals MoH Ministry of Health NAMFREL National Movement for Free Elections NCPC Naga City People’s Council NGO Non-governmental organization OECD Organization for Economic Co-operation and Development OPEN Outline Procedures Enhancement for Civil Applications OSI Open Society Institute PCA Philippines Contractors Association PGS Public Governance Score Card PIP Productivity Improvement Program PSAM Public Service Accountability Monitor PTF Partnership for Transparency Fund PWI Procurement Watch, Incorporated 5 RA Republic Act SADC Southern African Development Community SAI Supreme Audit Institution SMS Short Message Service TAN Transparency and Accountability Network TI Transparency International UNDP United Nations Development Programme USAID United States Agency for International Development USD United States Dollars 6 Introduction P rocurement monitoring is a relatively new �eld for civic engagement. This paper is a collection of eight selected cases studies which Tracking Social Spending (Mexico). Fundar was established in 1999 with the aim of enhancing transparency in public expenditure on health. aim to provide examples of practices that have Just a few years later, Fundar spearheaded an emerged globally in recent years. We hope that investigation into a US$3m contract from the the paper will stimulate new thinking on the national HIV/AIDS prevention program that was range of existing options for the establishment given to an anti-abortion group. On the basis of the of effective partnerships between state and non- success of this initiative, Fundar has established state actors. The objective is not to offer ‘blue- itself as a group that monitors corruption and the prints’ or ready-made solutions to the challenge improper use of funds, with a speci�c emphasis of civic monitoring, but rather to highlight some on health; and as an advocacy and networking of the broader complexities underpinning the group supporting improved access to budgetary successful development of new approaches. information and capacity-building for government and non-governmental actors. The cases have been drawn from Latin America, South Africa and East Asia, and have been Civil Society Participation in Text Book Count developed based on reviews of secondary (Philippines). This initiative was started as an material. Where possible, case studies have action research project, called ‘G-Watch’, by been reviewed and �nalized in collaboration with the Ateneo School of Government with the aim people directly involved in the process. The cases of monitoring the production and distribution were selected with the aim of highlighting the of textbooks to elementary schools. Made diverse forms of civic engagement across different possible by the Government Procurement sectors and levels of government. The different Reform Initiative, which enabled civil society to types of civic engagement mechanisms include: monitor bid processes, the initiative expanded autonomous research and monitoring, proactive considerably and has become very effective at disclosure of information for public access, state- monitoring quality and delivery at the local level civic partnerships in the implementation of public through a network of volunteers that have come expenditure decisions, and engagement of civic to be known as ‘Textbook Watch’. actors to support the process of reform. Integrity Pact in Greater Karachi’s Water Supply Scheme (Karachi, Pakistan). The The cases studies are designed to explore how Integrity Pact (IP), implemented by Transparency different mechanisms of civic engagement are International Pakistan with the Karachi Water and forged within speci�c social and political contexts, Sewerage Board, focuses on the prevention of and, more importantly, how the nature of such securing or retaining a contract through bribery engagement changes over time. In particular, the or other improper means. Important innovations studies focus on understanding the driving forces include the reduction of the number of tender behind the process as it evolved, the impact of packages, and the development of a ‘two- the intervention, and the potential for replication envelope system’ for proposals, which resulted at greater scale. in an estimated twenty percent cost saving. However, the memorandum of understanding on Summary of the case studies the use of the IP was left to expire following a While each case study can be viewed as a ‘stand- change in leadership in the public sector utility. alone’ example, it is also important to emphasize Program for Transparent Contracting (Morón, the value of the collection in terms of developing Argentina). A non-pro�t organization based in the discussion of common principles of civic Buenos Aires, Poder Ciudadano was created engagement in procurement. A brief summary of in 1989 to improve access to information the cases provides a starting point. pertaining to public interest. Because the city 7 has faced longstanding administrative abuse, courses for parliamentarians and non-state as soon he entered of�ce in 1999, the new actors on integrity and accountability and on the mayor, Martin Sabatella, promoted the ‘Program use of public expenditure monitoring tools. for Transparency and Modernization.’ Poder Partnerships in Procurement Reform Ciudadadano and Sabatella worked together to (Philippines) Procurement Watch Incorporated introduce an innovative contracting process for (PWI) was established with the support of various the city’s waste collection. Sabatella requested donor agencies in 2001 with the objective of Poder Cuidadano to help establish a program �ghting corruption through improved public that combined the use of public hearings with procurement oversight. A key component of its an ‘integrity pact.’ This program achieved strategy is using print, television, and radio media active citizen engagement at every step of the to raise awareness over the leakage of funds. The procurement process. passage of the Procurement Act has signi�cantly Making the Public Procurement System Work aided the institutionalization of PWI as both a (Naga City, Philippines). Faced with a city in a watch-dog and a partner in procurement reform. By state of economic decline, Mayor Jesse Robredo informing the public of the new provisions and their promoted the use of information technology to bring consequences, PWI has actively promoted civil about more inclusive and effective governance. society participation in monitoring procurement. Revising procurement practices was a major part of this. Two key elements combined to bring about Five Key Issues emerging from more open governance; �rst, proactive disclosure experience of information and performance standards; and From this wide canvas of experiences emerges second, institutionalized civic engagement, a number of common themes that can help notably though the establishment of a citizen stimulate new thinking about how to best support watch-dog, the Naga City People’s Council, enhanced civic engagement in procurement. which monitored the procurement processes. The OPEN System (Seoul, South Korea). Rapid 1. Procurement work is a part of economic growth in Seoul and the expansion public expenditure monitoring of the municipal bureaucracy had resulted in When promoting civic engagement as a way extensive and complex systems of regulation, to improve transparency, there is often an which in turn created opportunities for corruption. implicit assumption that alternative practices A key aspect of the Seoul Metropolitan can be ‘mapped’ directly onto the formal Government’s response was the creation of an project processes. This is rarely the case. One internet portal to make information relating to of the reasons that demand side procurement governance processes publically available. In work is fairly nascent is due to the inherent addition, the government introduced new types of dif�culty of isolating this component of a public performance benchmarks, which were based on expenditure cycle in a way that attracts the citizens’ perceptions of governance. active participation of civic actors. Globally many good examples exist of civic engagement Tracking Government Service Delivery (South in budget monitoring, expenditure tracking and Africa). The Public Service Accountability Monitor outcomes monitoring, and some of the best (PSAM) produces research and monitors key examples of civic engagement in procurement aspects of service delivery and government have evolved as an extension of these other performance in the Eastern Cape Province. In activities. addition to research on expenditure, in order to improve strategic planning and reporting While supply side initiatives have sought procedures, PSAM has developed training to open the procurement process to public 8 scrutiny though enhanced public disclosure, enabling context provide opportunities for civic demand side initiatives have tended to actors to effectively engage with governance approach procurement work from the broader processes in the short-term. However, long- perspective of outcomes. For example, in the term sustainability depends on the capacity of case of G-Watch in the Philippines, while both state and civic actors to evolve towards the monitoring agency was given access to the production of new procurement practices. records on contracting, this was found to be In many of these cases, involving the media less meaningful than the issues of distribution was important in expanding the reach of civil and quality assurance. It is therefore important society organizations. In others, civil society to consider the comparative advantage that actors were successful in securing their civic actors have when promoting new forms role in the procurement process by not only of procurement monitoring. offering training and capacity-building support to administrators and politicians, but also 2. Importance of entry points sharing tools or methodologies for monitoring. Civic engagement tends to be more successful One of the best examples of this non- when it is oriented toward tangible issues linear evolution process is G-Watch in and speci�c cases, rather than procurement the Philippines. Starting with the narrow processes in general. For example, the issue objective of monitoring the procurement of of funding allocations for HIV/AIDS which schoolbooks, the ‘Textbook Watch’ evolved led to the Provida corruption scandal acted as a social campaign to monitor a highly as a focal point for Fundar’s initial activities decentralized program. Equally remarkable on government monitoring. From this entry was the partnership that was forged with a point, the organization rapidly expanded private sector �rm (Coca-Cola) to provide a its scope to broader issues of monitoring in low-cost solution to the problem of delivery at the health sector. In this case, the scandal the elementary school level. was also important because it galvanized a broader coalition of civic and political actors, The evolution of initiatives is not always which Fundar supported through advocacy positive. Following a change in leadership and awareness-building activities. in the Greater Karachi water supply project, Broader shifts in the political context – or the memorandum of understanding was not crises - can also create important entry renewed, and as a result the Integrity Pact only points for civic engagement. In the case of applied to the initial stages of the procurement Morón in Argentina, a history of malpractice contract. This case highlights the fact that in the administration was one of the main sound and comprehensive technical design reasons why the new mayor decided to of improved procurement practices cannot promote transparency as a key issue in his be insulated from changes in the social and administration. In Seoul, a high level of political context. This �nding reinforces the economic growth provided the backdrop for need to develop strategies that are based on the establishment of a new, simpli�ed, and principles that emerge out of current practice, transparent system of governance processes rather than externally driven blueprints. to cope with the increasingly complex 4. Information is key, but information challenges of administration. flows are more important 3. Non-linear process of evolution Access to information is one of the founding In all these cases, the dynamic nature principles of new approaches to governance. of state-society collaboration should be As these cases show, however, the creation emphasized. A valid entry point and an of effective information channels is not an 9 issue related to the supply side alone. Rather, broader issues that are worth considering the engagement of ‘users’ in the design of when it comes to assessing impact. both the type and channels of information While monetary assessments of impact is an important component of effectiveness. are important for policy advocacy, citizen One good example of this is the development engagement in procurement processes tend of common information formats for demand to be influenced more by tangible outcomes side monitoring by the Public Service in terms of quality. While the two issues Accountability Monitor (PSAM) network in should be related, at times they are not. In South Africa, which allowed a broader network the case of schoolbook distribution in the of civil society organization to collaborate and Philippines, the contracting amount was thus expand the scope of the initiative. found to be less important than the quality Collaborations with media are also highlighted of the products and the speed they reached as a common factor in the success of many the pupils. In Karachi, the application of the of these initiatives. In Mexico, Fundar’s use Integrity Pact resulted in a twenty percent of a targeted media campaign led to the cost saving in consultancy and construction generation of various information products contracts. What is less clear, however, is the and dissemination of of�cial documents were extent to which this innovative governance then used by local journalists in their own approach delivered improved water and investigations. sanitation services to the citizens of the city. Information is a two-way process, and The second issue is that citizen centered engaging citizens to interact with procurement governance is intricately linked to the processes demands creative approaches. development of new benchmarks or Seeking to engage ordinary citizens, performance standards. Good examples of the mayor of Morón established multiple this are the citizen satisfaction surveys the channels of communication, including Seoul Metropolitan Government established monthly bulletins which were distributed to as part of the OPEN system in Seoul, or the all households, telephone lines, and local establishment of public hearings in Morón. As grievance redressal of�ces to encourage new innovations, tracking the improvement people to report malpractice. In Naga city, in the results of these types of performance short message (SMS) technology was assessments will not be possible until they used to allow residents to send queries and have been used for some time. feedback to the government. 5. Impact is important, but so are Use of the case studies outcomes Besides contributing to the analysis of the Many of these cases contain impressive concept of civic engagement in procurement, we evidence of impact in terms of reducing hope that these case studies can be used as part contracting costs and time usage and of of training sessions and advocacy efforts by both improving quality of �nal delivery. In most case, government and non-government actors. The however, quanti�able evidence of impact is structure of the cases aims to draw out some of dif�cult to assess which makes the task of the unique features of the various experiments, advocating the need for civic engagement in rather than attempt a cohesive or comparative procurement processes more complex. One assessment. We therefore would encourage the of the reasons for this is that often detailed reader to consider how these experiences can data on past transactions is not available to inform the development of procurement work in the public. However, there are a couple of other contexts. 10 Case Study One: Tracking Social Spending: Fundar, Mexico T his case discusses Fundar’s strategy of advocating increased public access to government budget information coupled with As part of its early efforts, Fundar obtained accounting records from the Ministry of Health using the national freedom of information law,2 budget analyses and expenditure tracking to and identi�ed corruption in a contract awarded influence government expenditures allocated for to a private agency for an HIV/AIDS prevention HIV/AIDs. program. Known as the Provida Case, it illustrates how Fundar with a civil society alliance pursued Background a successful campaign against the corrupt appropriation of budget resources intended for The budget is a government’s most powerful NGOs working on health issues. Fundar and the economic policy instrument, and therefore a consortium used the new transparency law to major influence on income distribution and gather evidence to support its case. poverty. Though the budget has traditionally been the product of a closed decision-making process, Unearthing the Provida Scandal a new international public �nance consensus In 2002 the Mexican Congress approved US$20 is emerging that promotes transparency and million for HIV/AIDS prevention. Luis Pazos, effective oversight. then President of the Appropriations Committee Budget analysis is a tool to expand information, in the Federal Chamber of Deputies, sent an encourage debate, and promote accountability by of�cial note informing the Minister of Health showing whether government promises are being that the budget for the HIV/AIDS prevention translated into sound policies and appropriate program had been reduced by US$ 3 million to allocations. Civil society can make important US$ 17 million. The US$3 million was allocated contributions in these situations by opening up the to Provida, an anti-abortion group in Mexico. In debate, organizing information to make it more this case, money was transferred directly from accessible to other researchers and advocates, Ministry of Health (MoH) to Provida through an or by pressing for greater transparency. entity -within MoH- called “Administración del Patrimonio de la Bene�cencia Pública� (roughly Fundar came into existence in Mexico in 1999 translated as Regulatory Body for Public Charity). as a non-governmental organization when a Although the process to receive grants goes by change of government was imminent and civil submitting a project proposal by the CSO, there society was changing its strategy from pressure is no evidence Provida submitted its own. There and confrontation to a focus on dialogue, is only the agreement between Provida and the monitoring, and policy research. The focus of Regulatory body to receive the grant. transparency work was changing from simply obtaining and publicizing information to using At the end of 2003, Provida submitted invoices to thorough, research-based evidence to promote justify the money spent from the grant. At midyear good governance. This made technical expertise 2004, using the new access to information law, essential to civil society if it was to remain effective Fundar received the �le containing the agreement in the new political context.1 between Provida and the Regulatory Body and all 1 The Ford Foundation provided an early source of �nancial support for Fundar’s budget transparency work �rst in Mexico and later at the regional level. It encouraged Fundar’s collaboration with Mexico’s Center for Research and Teaching in Economics (CIDE) to create the Latin American Transparency Index. Fundar’s work on improved federal and state level transparency and accountability has also been funded by the MacArthur Foundation, Open Society Institute (OSI), and the Hewlett Foundation. 2 In the late 1990s, a series of reports revealing the existence of secret presidential slush funds galvanized civil society groups in Mexico to push for increased public access to information, including increased access to information on the Mexican government’s budget. By 2002, a law guaranteeing citizen’s rights to information had been passed and a highly respected commission established to oversee its implementation. 11 the invoices. An auditor was needed to check all In one week, 700 Mexican CSOs backed the claim those documents, clarify questions and produce for transparency and sanctions, and demanded a joint report. the intervention of the Supreme Audit Institution. The �ndings were presented in full to legislators Fundar and �ve other CSOs3 investigated where from the three main political parties in November the money was �nally allocated. They found that 2003. Provida had requested the funds to open a dozen Women’s Support Centers, to encourage women A targeted media campaign was launched with to reject abortion. Both Mr. Pazos and the Ministry the advice of a specialist media organization – of Health denied they had reassigned funds or CIMAC - (Communication and Information on that the HIV/AIDS budget had even been cut. Women) after a request for a meeting with the health minister was denied. Using information Using the Federal Law on Transparency and provided by the coalition, the mainstream Access to Public Government Information, the newspaper Reforma carried the details in an CSOs con�rmed that the Ministry of Health had exclusive front-page story in July 2004, which paid Provida US$3 million, despite the legal gave rise to a stream of articles, features, and requirement that US$ 50,000 is the maximum cartoons in the mainstream press that continued amount that can be received by a CSO. They for more than two months. were also able to obtain the �nancial records of all Women’s Support Centers, totaling 6,525 The coalition produced compact disks with a documents. Fundar’s investigations revealed that PowerPoint presentation explaining the case payments were made without proper invoices, to and illustrating each argument with scanned bodies that shared the same address as Provida.4 of�cial documents. As a result, every reporter had access to the of�cial documents to illustrate This loose coalition of CSOs concluded that there and build the case. Journalists started their own were three main sets of irregularities: conflict of investigations. interest, tax evasion, and luxurious expenses. More than 90 percent of the US$3 million The Congress asked for explanations from was marked by these irregularities. The main the minister of health, began procedures for observations were: an auditing process, and promised to create a special committee on the case (though this • Luis Pazos misused and exceeded his never took place). The Supreme Audit Institution parliamentary powers. (SAI) started its own investigations based on • The Health Ministry did not ful�ll its the information already available. As a result, in responsibilities for transparency and September 2005, the Ministry of Public Function accountability. �ned Provida’s chairman US$ 1.2 million and punished him with a 15-year ban on receiving • Provida diverted public funds without proper public funds or serving as a public servant. In surveillance by the government. October 2006 the Supreme Court con�rmed this resolution. Three other low-ranking public • Provida received public funds despite their servants from the ministry of health were punished actions being contrary to government health with administrative sanctions, as well. policies. 3 In addition to Fundar, the network included two feminist organizations and three groups working on health issues and reproductive rights. 4 Among the more egregious items purchased by Provida with public funds were Mont Blanc pens and women’s underwear, which attracted considerable coverage in the media. Also, over 42 percent of the funds had been spent on ‘marketing,’ particularly to challenge emergency contraception. 12 The of�cial investigation conducted by the on auditing such funding. The Regulatory Body Supreme Audit Institution corroborated Fundar’s produced a manual to tighten the process, which �ndings. Pressure brought to bear by the Fundar- at least meant homogeneous grants. led campaign resulted in government proceedings to recover misappropriated funds and changes Fostering Transparency through in the policies governing the management of Budget Analysis discretionary funds, including the HIV/AIDS How does government use public funds? How prevention program. In March 2006 the Supreme much does government spend on programs for Audit Institution delivered a comprehensive the people? Where does the money go? Are the report on Provida’s 2003 activities. It con�rmed funds allocated for speci�c programs suf�cient the CSOs’ audit results and recommended penal to accomplish them? And most important, where actions against Provida’s chairman. The Ministry should they go? of Health cancelled all contracts with Provida (They were due to receive another US$5.7 million These questions were new to Mexican citizens in public funds). It audited Provida and demanded and many policymakers when Fundar started its the US$3 million received in 2003 be refunded. work. Thus a key task before Fundar was, and is, to help the Government and the public learn what More signi�cantly, the ministry changed to do with the information it helps make available budgeting procedures, particularly those related (Box 1). Fundar took the lead in helping to ask to CSO funding, and created an agency focused and answer these questions, which are critical to Box 1: Making public spending more transparent In March 2006 the government passed the Budget and Fiscal Responsibility law, which attempts to make public spending more transparent and disciplined. Article 106 of the law mandates the Executive to disclose information on government expenditures on a quarterly basis. The Ministry of Finance already publishes this information in quarterly reports, which can be found at www.shcp. gob.mx. In addition, information of expenditures in poverty reduction programs is also accessible through the Internet at the Secretary of Social Development (www.sedesol.gob.mx). However, the 2006 law applies only to central government activities. Although the current decentralization initiative will pass increasing responsibilities to state governments, there is no federal law requiring that local authorities publicly disclose their spending. State governments must publish their annual budgets in the of�cial gazette, which provides budget information for state agencies, but these reports are limited and lack detail. In a recent overview of transparency in Mexico, Fundar, reported that despite concrete improvements due to increases in political plurality and division of power, Mexico still faces two major challenges: • Discretionary use of surplus income on the part of the Treasury Ministry; • Lack of transparency and accountability mechanisms that would make it possible to monitor the use of surplus income transferred to the states Despite the country’s genuine advances, the need remains for clari�cations regarding the public right to information, accountability rules and checks and balances to the Treasury’s discretionary power, the power of legislative commissions, and the obstacle of opaque areas such as government trust funds. Source: http://www.revenuewatch.org/our-work/countries/mexico-transparency.php (accessed June 2008) 13 making effective policy and ensuring a healthy no experience treating HIV/AIDS patients (Box and lasting democratic transition. 2).5 The hospitals in this case were part of the Ministry of Health and therefore were under its Through careful research and analysis, Fundar administrative control, so grants did not need to monitors corruption, tracks improper use of public be “procured.�Based on the data, the organization funds, analyzes budgets, particularly as they developed an advocacy strategy to boost HIV/ apply to marginalized populations, and develops AIDS allocations in the 2006 budget. accountability measures. Budget analysis offers new tools for strengthening assessment of Apparently, �nancial requests from hospitals government responses to resource needs. In were the reason for the choice made by the Mexico, Fundar’s budget analysis went a step Ministry of Health rather than epidemiological further, revealing that the formulas for distributing ones. They simply channeled the money through funds for critical services for needy populations HIV/AIDS budget category, as odd as it sounds. actually perpetuate, rather than correct, The reasons for the choice of hospitals were not underlying inequities. clear at all and, thus the case. Each year since 2003, Fundar has analyzed the Working in alliance with a group of HIV/AIDS Mexican government’s spending on HIV/AIDS. In patients, Fundar initiated an advocacy strategy its analysis of the 2005 federal budget, Fundar that comprised a press conference, meetings identi�ed a new allocation scheme for HIV/AIDS with the directors of CENSIDA and the �nancial- funds. For the �rst time, the Seguro Popular administrative head of the Health Department, (the country’s health care program) was given Internal Comptroller, and two congressional resources for HIV/AIDS—more such funding than committees on Health and Gender. any other institution, including the National HIV/ AIDS Center (CENSIDA). By researching the chapter on HIV/AIDS in the federal budget, Fundar has tested the Mexican Fundar decided to follow up this analysis by government’s level of transparency. In addition, monitoring the application and use of HIV/AIDS Fundar has produced the only comparative funds. Using the electronic system established by analysis of the legal framework and accountability IFAI (Federal Institute of Access to Information), mechanisms of the 33 Mexican Human Rights Fundar submitted more than 200 formal requests Commissions. It has studied accountability in for information to the Finance Department, the Mexico City police force and initiated a pilot Federal Health Department, CENSIDA, and the program with partners in Guerrero for evaluating National Commission for the Seguro Popular police performance. After Fundar protested a over the course of the year. These requests Finance Ministry decision to cease publication aimed to determine the criteria used to allocate of detailed information on federal expenditures, HIV/AIDS funds, and how the hospitals and other the Ministry recommenced publication, this time institutions that received the funds used them. with an enhanced search engine on the Web. Fundar’s main purpose was to launch a public Fundar also led a regional effort to create a Latin campaign informing patients who required HIV/ American Budget Transparency Index. Fundar AIDS health services about the availability of has also looked at maternal health programs. additional care resources. Through its analysis and coalition- building efforts, The investigations reported some troublesome the organization has influenced government �ndings—among them that the Department of programs to combat maternal mortality and Health had distributed funds to hospitals that had pressed for additional funds. 5 Human Rights Watch, Lost in Transition: Bold Ambitions, Limited Results for Human Rights Under Fox, 2006, p. 44. 14 Box 2: Analyzing the use of HIV/AIDS funds: Some Results • The information provided by government agencies is of low quality. Fundar received contradictory responses from different institutions regarding their role in the distribution of funds, the level of spent resources by mid-year, and the reallocation of resources to different objectives. • The Ministry of Health allocates funds on the basis of �nancial rather than epidemiological criteria. When funding for HIV/AIDS prevention and treatment was increased in 2005, the Health Department distributed these resources among hospitals that had suffered general operational cutbacks, even if they had no HIV/AIDS component. Meanwhile, hospitals that actually specialized in HIV/AIDS received no extra help. • Institutions have wide discretion over how they spend HIV/AIDS funds. Three out of the seven institutions that received HIV/AIDS resources (with the exception of CENSIDA and Seguro Popular) reclassi�ed those funds under “General Services� and spent them on banking and �nancial services, cleaning, surveillance, and building and vehicle maintenance. • Accountability is lacking. Because hospitals and institutions are autonomous, the Health Department cannot specify how HIV/AIDS funds should be spent. In addition, even though CENSIDA is responsible for overseeing the national HIV/AIDS strategy, it does not have a mandate to coordinate the use of these funds. Also, the Finance Department considers the resources spent as soon as they are transferred to the institution, regardless of how they are actually used. As a result, money spent on cleaning, maintenance, and banking services will appear as having been spent on HIV/AIDS programs. This issue reflects a major structural problem in Mexico’s budget system: the balance of spent money, which is yearly handed over to Congress, is not a faithful portrayal of reality In 2002 Fundar’s research resulted in greater information and tested analysis to policymakers transparency in the government’s decentralized serves as an instructive and inspiring example health funding and, for the �rst time, speci�c to other organizations. But perhaps the greatest earmarking of funding for maternal health impact of its work has been in improving the programs. In 2003 its work led to a tenfold quality of public debate and giving legislators and increase in budgetary allocation for a national CSOs better access to budget information. These program designed to reduce maternal mortality results have contributed to simplifying and more through emergency health care provision. This widely disseminating information—including represented an additional increase on the order persuading the government to publish of�cial of US$50 million for a program to directly bene�t budget data online; to fostering transparency; underserved pregnant women, especially those and to building capacity and awareness among from indigenous communities. Its 2004 study other civil society organizations. on the cost of equipping health centers with basic emergency obstetric equipment and staff Capacity building in Mexico and throughout Latin contributed to the Ministry of Health’s decision America, in the form of workshops and training to enhance coverage for common pregnancy for the media, NGOs, journalists, and legislators, and delivery complications in the government’s has contributed to wider understanding of Popular Insurance program. budget issues in order to enhance advocacy campaigns. Fundar also provides orientation Greater Access to Budget Information sessions for legislators on various aspects of the Fundar’s success in earning a respected space in federal budget, and provides the congressional the national political context and providing useful budget committee a steady supply of information 15 and analysis. In addition, it produces several within civil society to maximize the visibility and use publications that contribute to both knowledge of its analysis. A distinct organizational attribute and advocacy efforts—among them a regular is presenting budget analysis and information quarterly bulletin (Pesos y Contrapesos) for a on a range of issues under legislative and policy wide range of budget issue stakeholders. The debate with inputs from multiple sources. organization publishes government budget data on its Web site as a resource for legislators, the References media, and civil society actors. Fundar 2007 “The ‘Provida’ Case: A Challenge for Budget Transparency.� www.openbudgetindex. Working within a Coalition org/2.ATasteofSuccessFundarAdvocacy-Alberto.ppt An important factor behind Fundar’s success was an (accessed March 28, 2008). emphasis from the beginning on building alliances IBP (International Budget Project). 2004. “Opening with organizations and networks with signi�cant Budgets to Public Understanding and Debate: experience in health concerns. The Provida case encouraged civil society organizations to Results from 36 Countries.�http://www. internationalbudget.org/openbudgets/Fullreport.pdf work together collaboratively through a carefully orchestrated strategy of systematic research, León, Jorge Romero. 2007. “One Step Forward, Two legislative advocacy, and media influence. The six Steps Back? Budget Transparency and Access to participating organizations worked together on the Information in Mexico.� In Mexico’s Right-to-Know Reforms: Civil Society Perspectives, Fundar, 164–69. objectives of the collective, and then on a media http://www.fundar.org.mx/secciones/publicaciones/ strategy. The idea of working with a mainstream pdf/right_to_know/SEC4%20Jorge%20Romero.pdf. newspaper to expose this corruption emerged from the collective, with inputs from a specialist Robinson, Mark, and Vinod Vyasalu. 2006. media organization. “Democratizing the Budget: Fundar’s Budget Analysis and Advocacy Initiatives in Mexico.� Case study The case remained prominent on the public prepared for the Lessons from Civil Society Budget Analysis and Advocacy Initiatives research project, agenda partly thanks to opposition politicians, International Budget Project, Washington, DC. www. who were outraged at the diversion of funds and internationalbudget.org/Mexico-Fundar.pdf (accessed sought to capitalize on the scandal. Fundar was an September 5, 2006). integral part of the effort, unearthing documents and expenditure statements that provided critical Contact Details evidence to support the campaign. Fundar Fundar’s institutional character, and its Cerrada de Alberto Zamora No. 21, implications for alliances with other organizations, Col. Villa Coyoacán, is an important strategic issue. Fundar does not Del. Coyoacan, C.P. 04000, ally itself with political parties on policy issues, México since a nonpartisan approach is essential for the Tel: (52-55) 5554-3001 Fax: ext. 140 legitimacy of its work with the congress. Rather, it Email: fundar@fundar.org.mx works as part of broader alliances and coalitions 16 Case Study 2: Civil Society Participation in Textbook Count: G-Watch at Ateneo School, Philippines T his case illustrates how civil society, with G-Watch in the lead, has partnered with the Department of Education since 2003 to increase guide and constrain the administrators and other players to appropriate actions and decisions. To complement perception surveys, researchers the delivery of textbooks to school children are deployed as G-Watch monitors to visit across the Philippines. A unique feature of this project sites and collect documents to be used case is that G-Watch’s role extends beyond to assess government performance in service procurement, and extends down to assessing delivery. The group has developed and tested distribution – with an implicit focus on quality, and tools to monitor textbook delivery, medicines the mass mobilization of volunteers to monitor procurement, school building construction, and distribution at a decentralized level. public works projects. Background Textbook Production and In 2003 the Department of Education of the Delivery Philippines launched Textbook Count: National With a provision in the Government Procurement Textbook Delivery Program. The purpose of Reform Act (Republic Act 9184) giving the program is to improve the ef�ciency of the representation to civil society observers in the procurement, production, and distribution of bid processes of the government, G-Watch is textbooks to schools throughout the country. A able to sit in all stages of textbook procurement. notable feature of the program is the extensive The Department of Education sends notices to involvement of civil society organizations. Five G-Watch regarding its procurement schedule annual rounds have been completed, covering –from the pre-bid conference up to the bid the academic years 2003–04 through 2007-08. evaluation and post-quali�cation. Information on (These are subsequently referred to as Textbook the awarding of contract and the release of the Count 1, 2, 3, 4 and 5). notice to proceed given to the winning suppliers Under Textbook Count, which uses the are also made available to G-Watch. International Competitive Bidding system, In support of the Procurement Reform Act, the textbook prices were reduced by nearly 50 Department of Education issued Department percent, the procurement process (bidding to Order 59, which further institutionalizes civil delivery) was shortened from 24 to 12 months, society participation in the Department’s and ghost deliveries were almost entirely procurement processes. Not only does the eliminated. Order open up the Department’s procurement of G-Watch (Government Watch) is an action textbooks to civil society, it also opens up all other research program under the Ateneo University’s procurement items. School of Government and serves as the national coordinator for civil society participation During the production of textbooks, G-Watch in Textbook Count. G-Watch was created in coordinates with the Department of Education’s response to widespread reports of corruption Instructional Materials Council Secretariat for and inef�ciency in the government of ousted civil society organization participation in surprise President Joseph Estrada. It partners with textbook quality inspections in printing presses different government agencies to put in place (or warehouses for textbooks from outside mechanisms that improve the delivery of basic the country). Inspections are undertaken at government services by integrating participatory every stage of production. The civil society mechanisms into government policies and organizations attending the quality inspections programs, allowing direct citizen scrutiny of underwent training given by the Instructional government transactions. This is expected to Materials Council Secretariat. 17 The Instructional Materials Council Secretariat manuals to 40,000 elementary schools around informs G-Watch of the textbook delivery schedule the country. The textbooks represented a total and gives copies of the notices sent to school value of 542 million pesos (US$ 12.9 million). heads and district supervisors which G-Watch The monitoring process was divided into three in turn forwards to the executives and/or chapter phases: heads of the Boy and Girl Scouts of the Philippines, (i) Procurement of Textbooks: Civil Society as well as the National Movement for Free Organization volunteers did not participate Elections (NAMFREL). Personnel on the ground in the procurement meetings, but all coordinate with the school heads, and district procurement-related documents were supervisors for the schedule of delivery. During provided to G-Watch. These were reviewed the actual delivery, representatives of civil society and no anomalies found. However, the organizations, together with other personnel from project was seriously affected by a delay of the Department of Education conduct a last check around four months due to legal challenges on the textbooks. The Inspection and Acceptance mounted by losing bidders. Reports to be submitted to the Department of Education Central Of�ce also contain boxes for (ii) Printing - Upon the release of the notice to the third-party inspectors to sign. proceed to winning bidders, Department of Education’s- Instructional Materials Elementary school textbooks, unlike those Council Secretariat and the Civil Society for high schools, are delivered only up to the Organizations, through G-Watch, closely district of�ce. This poses a challenge for those coordinate with each other for the textbook elementary schools that are very far from the quality inspections. Department of Education district of�ce. A documentation of this problem staff members carried out around 70 surprise was made by G-Watch, prompting the introduction inspections. Civil Society Organization of an initiative called the Textbook Walk. volunteers participated in 18 of these A Memorandum of Agreement had been signed (against a target of 20). The defects found with Coca Cola. The company’s involvement in locally produced textbooks were minimal, and the program’s use of the company’s trucks suggesting that the surprise visits to local for textbook deliveries (from district of�ces printing plants during Textbook Count 3 were to elementary schools) was a unique and effective. However, a serious defect was successful innovation seen in Textbook Count found in the books printed abroad. This led 3. In the succeeding rounds, this was no longer to the decision to include visits to overseas availed because of the change in management printers in Textbook Count 5. of the company. The Department of Education (iii) Distribution –books were initially scheduled is looking into tapping other companies for a to be delivered by printers to Department partnership like that with Coca-Cola. In Textbook of Education’s district of�ces during Count 5, a mining company in Palawan province August–September 2006. As a result of was tapped to help in the distribution within its delays mentioned above, the deliveries took area of operations. place during January–February 2007. This delayed onward delivery from district of�ces Heightened Emphasis on to elementary schools, which took place Monitoring during March–May 2007.6 These delays put Textbook Count 4 began monitoring the production considerable strain on those responsible for and delivery of 12 million textbooks and teacher mobilizing volunteers, and meant that Coca 7 The Philippine school year starts in May each calendar year. In some cases it was decided to keep the books at the district headquarters during the summer holidays. 18 Cola was unable to offer the same distribution in previous transfers from Department of services they had provided so successfully Education district of�ces to elementary schools;7 during previous rounds. Deliveries did ii) test whether monitoring could be decentralized not always take place as scheduled and to the local level and handled entirely by local sometimes took place well outside working community groups; and iii) make education a hours. Though this made it dif�cult to mobilize central priority at the local level. volunteers in a timely fashion, 70 percent of Textbook Walk involved multi-stakeholder deliveries were monitored by volunteers, who partnerships, community participation, and completed 4,700 Inspection and Acceptance public awareness and education. The project Reports. received �nancial support from the Partnership An estimated 4,700 volunteers carried out the for Transparency Fund (PTF) and the Coalition monitoring activities. Parents, students, scouts, against Corruption (CAC), two international church parishioners, and village leaders all organizations. volunteered their services. Textbook Walk included a festive occasion In Textbook Count 4, 39 Civil Society Organizations involving local community groups, in the Filipino participated, up from 33 during Textbook Count 3. spirit of �esta, to celebrate the transfer of books G-Watch and Department of Education provided from district Department of Education of�ces to training for the volunteers involved in printing elementary schools. Members of the Boy Scouts plant inspection. The volunteers engaged in and Girl Scouts of the Philippines, the National delivery monitoring required no further training, Movement for Free Elections (NAMFREL), church- as the knowledge and experience acquired in based groups, and other local organizations previous rounds was retained. took part. It covered more than 90 elementary Formalizing the government–civil society schools and involved some 60,000 textbooks engagement was a Commitment of Support and teacher’s manuals. Festive activities took and Cooperation signed by the Department of place simultaneously in all of the pilot areas and Education and the Consortium of Civil Society different modes of transporting the books were Organizations. The civil society and private used –pedicabs, pushcarts, carabao (buffalo), sectors committed to help during the bidding, trucks, tricycles, human chains, and motorcycles. production, and delivery stages and with The activity proved effective in helping districts distribution of textbooks from the districts to bring textbooks to schools and start localizing the elementary schools. When the local suppliers Textbook Count. began printing, the Civil Society Organizations Textbook Walk stimulated greater interest joined in a series of quality inspections of the in locally generated partnerships, reducing presses. There were also pre-delivery warehouse dependence on centralized management and inspections for the books sourced from an facilitating institutionalization through a culturally international supplier. sensitive approach. It offered proof that local communities can and will take the lead and can Piloting Community-Based own the textbook delivery process. This augurs Initiatives well for efforts to detach G-Watch from its central coordinating function. Textbook Count 4 piloted an initiative called Textbook Walk in 7 schools in each of 12 districts Importantly, Textbook Walk also generated (of 2,359). The initiative had three aims: i) address feedback from the �eld on the existing textbook the problems of undelivered books encountered situation. The ideal 1:1 student-textbook ratio is 7 In this annual round, no textbooks were to be delivered to schools, which receive books directly from suppliers. 19 still a far cry from the real ratios of 1:3, 1:4, or assessment report stated that “a vulnerability 1:5 in the schools. Defective textbooks were not is that G-Watch remains dependent on donor being replaced because principals and teachers funds to �nance its work.� Progress is still were unaware of their available stock or believed required to reduce this vulnerability. The replacing them would take too long. The quality of ongoing Textbook Count 5 is a test to the non the content of the current public school textbooks reliance of G-Watch on donor funding. also was perceived negatively. Textbook Walk • Cultural Adaptation – Textbook Walk was a expanded to many more districts during Textbook successful attempt to recognize and use to Count 5. good advantage aspects of Filipino culture to advance the cause of timely delivery of Institutionalizing Textbook textbooks. Count The Department of Education order is especially The Department of Education’s commitment to bene�cial to civil society because it was seen to government–CSO collaboration on Textbook expand the scope of monitoring, lower barriers Count has been remarkably consistent. With to participation by organized groups, and each round of the program, the role of the Civil deepen the cadre of procurement observers/ Society Organizations expanded, to the point monitors to include concerned but unorganized where they became almost a natural part of citizens. Undeniably, the signing of the order textbook procurement and delivery process. This has provided a stronger basis for expanding the allowed G-Watch to focus more on other aspects monitoring of contract implementation, not only of program implementation. Notable in Textbook for textbooks, but for other procurement items as Count 4 was the reduced reliance of local monitors well, at all levels of the Department of Education on coordination directed at the national level. bureaucracy. The actual application of this policy, With less supervision from G-Watch, the local however, has yet to be seen. monitors were still able to carry out their tasks. Another G-Watch initiative was piloted during This indicated growing local initiative, a welcome Textbook Count 5 which operationalized an spillover from the familiarity with the process that order called PRO: Protect Procurement Project the local volunteers developed in previous rounds. - the project protects, expands and sustains the In the report on institutionalization prepared gains of Civil Society Organization participation under Textbook Count 3, four dimensions of in the Department of Education, speci�cally in institutionalization were distinguished: procurement. • Legal Framework - The most signi�cant Five annual rounds of Textbook Count have development in institutionalizing Textbook resulted in a well-established and well-accepted Count has been the issuance of Department of program of government–civil society cooperation. Education Order 59/2007— “Institutionalizing The experience gained over the years shows in NGO and Private Sector Participation in the many ways: the comfortable way in which all Department’s Procurement Process.� parties involved deal with each other, the reduced • Civil Service Practices – There appears to need for training �eld staff, and the development be general acceptance within the Department of ‘horizontal linkages’ between different of Education bureaucracy of the cooperation organizations (at district level and below) so program with civil society. Department of fewer matters require the involvement of the top Order 59/2007 in fact pushes this cooperation of the organizations in Manila. well beyond textbooks into areas such as Certain achievements suggest that what has school buildings and supplies. been achieved will not be easily reversed: the • Reliable Financing – The Textbook Count 3 Department of Education order cementing the role 20 of Civil Society Organizations in the procurement society by creating a culture of participation at and distribution of textbooks; the reduced cost the local level. Central coordination will become of books over the past few years; the minimal unnecessary if people at the local level already number of defective books found during surprise know how to monitor service delivery. For inspections; and the virtual elimination of the citizens, G-Watch’s approach opens up another original problem—that 40 percent of books went avenue for civic engagement and opportunities to undelivered. become part of a solution that helps institutions serve them better. G-Watch initiatives are �nanced mainly through grants from donors including the United Nations Development Program, the Partnership for References Transparency Fund, and the United States Government Watch, Ateneo School of Government. 2006. “Tracking the Distribution of School Textbooks.� Agency for International Development. The Report submitted to Partnership for Transparency Fund, Ateneo de Manila University provides for other Makati, Philippines. http://partnershipfortransparency. operational needs, such as of�ces, equipment, info/Completed+Projects.html (accessed February 1, 2008). and administrative services. Currently, G-Watch ———. 2007a. “Civil Society Mobilizes Communities is not �nancially sustainable or pro�table. To for Textbook Distribution.� Manila. http://asg.ateneo. avoid possible conflicts of interest and the risk edu/news_GWatch_textbookwalk.htm (accessed of co-option, the organization does not ask for January 29, 2008). funding or other assistance from any government ———. 2007b. “Project Completion Report on the Civil agencies it monitors. Nor are citizen groups or Society Participation in Textbook Count 4.� Report submitted to Partnership for Transparency Fund, communities asked for monetary contributions— Makati, Philippines. http://partnershipfortransparency. the time and resources they volunteer for the info/uploads/completed%20projects/TC4%20Report. monitoring are already their vital contributions. pdf. EthicsWorld 2006. “Civil Society Coalition Looking ahead, there are two key questions: Beats Corruption and Delivers Vital Books to can Textbook Count now �nance itself? Can the Public Schools in the Philippines.� EthicsWorld, program operate without G-Watch? Textbook Washington, DC. orghttp://www.ethicsworld.org/ publicsectorgovernance/bestpracticesbyngos. Count 5 has proceeded without donor �nancing, php#philippinestextbook (accessed January 29, 2008). and G-Watch has taken a hands-off approach— Para�na, Redempto 2007 “G-Watch.� Changemakers, ready to provide advice but leaving the lead to the Arlington, VA. http://www.changemakers.net/en-us/ Department of Education and the Consortium of node/737 (accessed February 1, 2008). Civil Society Organizations. Public Affairs Foundation (Bangalore, India), Karen Sirker, and Sladjana Cosic. 2007. “Empowering the The G-Watch approach is unique because it Marginalized: Case Studies of Social Accountability has demonstrated concrete results respected by Initiatives in Asia.� Working Paper, Report 42994, World Bank Institute, Washington, DC. http://go.worldbank. both the government agencies being monitored org/4VUON78930. and the citizen-monitors themselves. By being collaborative and inclusive, it puts anticorruption Contact Details work in a productive and positive mode. From Joy Aceron the government’s perspective, this approach Coordinator, G-Watch Ateneo School of Government eliminates any thoughts that civil society is (Academic Program) interested only in highlighting social problems, Ateneo de Manila University making demands, fault �nding, and headhunting. Paci�co Ortiz Building (formerly Center for Social Instead, there is growing recognition that citizens Policy Building) Loyola Heights, Quezon City can capably share responsibility for making Tel. No.: (02) 4266001 loc. 4644/ (02) 426-6062 programs more effective. G- Watch is trying to Telefax No.: (02) 920-2920 “culturally institutionalize� the participation of civil Email Add: jaceron@ateneo.edu 21 Case study 3: K-III Greater Karachi Water Supply Scheme: Pakistan T he Greater Karachi Water Supply Scheme highlights the Integrity Pact developed by Transparency International as a tool to promote who took over was not supportive of the actions of the previous incumbent. This resulted in TI Pakistan’s disassociation with KW&SB on the transparency and accountability in public K-III contracting process. contracts, as well as illustrates how fragile social accountability reforms can be and how dependent What is an Integrity Pact? on leadership support for sustainability. The “Integrity Pact� was developed by Transparency International following extensive Background discussions with governments and international The Greater Karachi Water Supply Scheme agencies such as the World Bank, the Inter- (K-III) forms part of the City of Karachi’s 13-point American Development Bank, the Asian Program for Economic Revival of Karachi. A Development Bank, the International Finance project critical to improving the city’s water supply Corporation, the United Nations Development situation, K-III had serious problems at the pre- Programme (UNDP), the Court of Arbitration tendering stage. Among them: it was structured of the International Chamber of Commerce, on untenable and outdated contract stipulations and Fédération Internationale Des Ingénieurs- and defective package structuring; contractors Conseils (FIDIC) or International Federation of were prequali�ed without proper due diligence; Consulting Engineers. The pact is a system which and the possibility of bribery—common in insures that all activities and decisions of public previous situations—threatened the integrity of of�ces are transparent and that the projects/ the process. works are implemented, services are provided or taken, and goods/materials are supplied without The integrity pact (IP) implemented by the giving or taking of any kind of bene�t, �nancial Transparency International (TI) Pakistan with or otherwise. Justi�cation of the decisions taken the Karachi Water & Sewerage Board (KW&SB) is provided without reservation to the parties focused on the prevention of bribery to secure or concerned and to any interested individual or retain a contract or other improper advantage. institution/organization. The Integrity Pact along with public information The integrity pact is designed to make public provided through a Web site, established the procurement practices more transparent by credibility of the procurement procedures of accomplishing two objectives: KW&SB. In an unprecedented move globally, the Integrity Pact was signed by all participating • Enable companies to abstain from bribing by consultants and contractors on the K-III Project providing assurances that their competitors and by relevant KW&SB staff. Also, the signing will also refrain was mandatory and not voluntary, for the �rst time globally. • Enable governments to reduce the high cost and the impact of corruption on public TI Pakistan closely monitored the application of procurement the integrity pact in the K-III project during the The IP concept can also be applied when a �rst phase—the tender process for selecting government, as part of its privatization program, design and supervision consultants—until invites bids for the acquisition of government awarding of the contract. For the second assets, or for the granting of telecommunications, phase, TI Pakistan disassociated itself from the transport, mining, logging, or other such licenses. project after the prequali�cation of contractors. A change in government happened while the Considering the critical role normally played contracting was still on and the new City Nazim by consulting engineers or other consultants in 22 preparing procurement documents, evaluating bids transparency in procurement within KW&SB. and supervising contract execution, their selection Following the workshop, the Integrity Pact was should be subject to the IP concept as well. signed by all consultants and contractors bidding for contracts related to the K-III Project. Signing The IP is an agreement between the government was mandatory for all consultants—a �rst for TI agency and the companies that bid for the supply projects the world over. Many other TI chapters of goods or services for a selected contract or have since made the pact mandatory for all project that bribes will not be offered, granted, or bidders in a public contracting process. sought, during both the bidding process and the implementation of the contract by the successful TI Pakistan prepared the evaluation criteria for the bidder. The IP has the following main features: selection of design and supervision consultants for the K-III project. After the short-listing, TI Pakistan • A formal no-bribery commitment by the provided assistance in developing transparent and bidder, as part of the signed tender document, discretion-free evaluation criteria for the ‘Letter [supported by a company Code of Conduct of Invitation’ (LoI), based on the “two-envelope- and a Compliance Program] system,� which requires separately sealed • A corresponding commitment by the envelopes for the technical and �nancial proposals. government to prevent extortion and the Only those technically evaluated proposals that acceptance of bribes by its of�cials scored 75 percent were considered for �nancial evaluation, and the best of those proposals were • Disclosure of all payments to agents and selected for award of the contract. other third parties One important step in the K-III project was the • Sanctions against bidders who violate their reorganization of the project that combined 18 no-bribery commitment tenders into 8 packages. The arrangement was • The involvement of civil society in monitoring essential not only to make the bidders’ workload bid evaluation, the award decision process, economical and to complete the tender award as and the implementation of the contract quickly as possible, but also to make the awarded contracts easier to monitor (box 3). The contract • Public disclosure of the award decision, was awarded to the top ranking technical �rm on including the major elements of the evaluation the lowest price quoted by the top three ranked and the reasons for the selection of the �rms. successful bidder Finally, based on the Integrity Pact, KW&SB Formalizing the Integrity Pact awarded the consultancy contract for US$1.4 million in July 2002. The contract was awarded The integrity pact was introduced by TI Pakistan, to Techno Consult Pakistan, Ltd. and importantly, who executed the �rst phase of the project in the consultant contract agreement included the 2002 with an estimated contract value of nearly TI Pakistan integrity pact in its implementation. US$ 1 billion. 8 The contract amounted to a net saving of nearly US$4.2 million compared to the Planning First phase: Selection of Consultants Commission estimate of US$ 5.6 million. The In May 2001, to con�rm the establishment of the earlier K-II Project, which comprised work volume Integrity Pact, TI Pakistan organized a workshop similar to that of K-III, was executed in the years for KW&SB. The workshop introduced the Integrity 1993–2001 at a consultancy fee of about US$4 Pact’s principles and its bene�ts in establishing million. 8 Approximately Rs 44 = US$1 23 play an important role. One of TI Pakistan’s Box 3: Reorganizing the Tenders �ndings is that benchmarks, standards, and Eighteen tenders were combined and reduced constant monitoring are important for the to eight packages of two to three contracts credibility of any procurement system. The each. The decision was based on the need monitoring mechanism was integrated in Public to stagger the implementation of different Procurement Rules 2004 on the basis of TI groups of contracts. Since implementation Pakistan’s recommendations. of some contracts would take longer than others, contracts had to start at different Monitoring during the contract award times. Otherwise, there would have been process a risk of delay, and the early completion of The KW&SB Evaluation Committee comprising some contracts would have meant that they KW&SB and Government of Sindh of�cials could not be checked for the required testing prepares an evaluation report on the bids and of standards. The testing could occur only forwards it to all bidders 10 days before the after the completion of the entire project, contract is awarded. The competitors—who before which water could not be released into are technically the most competent to examine the system. Therefore it was essential that all the recommendations and reasons cited for or the contracts be completed simultaneously. against their winning the contract—are thereby given an opportunity to check and comment on Second Phase: Selection of the of�cial evaluation. This exercise helps prevent Contractors evaluators from either manipulating the award or After TI Pakistan ceased to implement the making mistakes in the evaluation process. Integrity Pact once the contract had been awarded, Brigadier Sardar Javed Ashraf Khan, Monitoring after the award of contract the managing director of KW&SB, supported and Media is actively involved in monitoring the continued the process of transparent procurement contracts awarded- ensuring the Public that had been established at the consultancy Procurement Rules 2004 (issued by Ministry tendering stage. He regularly sought TI Pakistan’s of Finance, S.R.O. 432 (I)/2004) are followed. advice on transparency and on procedural The contract documents as well as the aspects of the award of tenders. The advice given evaluation report are made public on the Web by TI Pakistan was fully implemented. site of the procuring agency. This gives civil The tender process for contractors’ contracts society watchdogs the opportunity to monitor was completed in September 2003, and all major the contract and its physical implementation construction contracts were awarded at a total and to raise questions whenever they �nd, for cost of US$ 100 million. This total cost for award example, substandard works. The published meant net savings of US$ 20 million against the contract document also provides an opportunity approved Planning Commission estimates of for bidders to learn about the contract rates, and US$120 million. TI Pakistan felt that the process if they are high, to encourage their interest in was overall in accordance with the spirit of the participating in future tenders. The anticorruption Integrity Pact. The project was completed ahead agencies (National Accountability Bureau and of schedule at a total cost of US$ 100.2 million. the Sindh Anti Corruption Department) also have ready access to the evaluation report and the Monitoring the Integrity Pact: contract, which lets them to check the process Citizen’s Engagement without the delay caused by obtaining documents Monitoring is an ongoing process in which the in hard copy. Maintaining a transparent tendering bidders, civil society, and anticorruption agencies process has ensured a reduction in complaints. 24 Impact: Providing a Model for exceeding US$ 1 million. The Mayor of Karachi decided to apply the integrity pact concept, Others in partnership with TI Pakistan, to all public In May 2006 the project was completed ahead contracting and procurements for the city. of schedule, providing additional evidence that transparent procurement procedures generate TI Pakistan has been assisting different healthy market competition, which coincides with procurement agencies since 2004 in across-the- high-quality constructions. board implementations of public procurement rules to build con�dence in the bidding process in In a report prepared by the Working Party of the Pakistan. The direct involvement of civil society Trade Committee of the OECD on transparency is built into the new procurement procedures. in government procurement, the case is explicitly In 2007 TI Pakistan signed a Memorandum of highlighted as an example of cost-savings under Understanding with the Minister of Irrigation & transparent procurement systems. Details of Power, Government of Sindh, to guide the ministry those savings are provided in Table 3.1. in preparing transparent tender documents for The net savings of US$ 24.2 million is due irrigation projects9 and the World Bank funded to the implementation of transparency in the Sindh Water Sector Improvement Project Phase-I procedures adopted for award of the contracts. included TI Pakistan as an independent observer. This has also achieved, at the same time, a more TI Pakistan has signed (since 2002) MoUs with ef�cient allocation of resources through increased many departments for implementation of “Integrity competition and higher quality procurement, not Pacts�. They include Pakistan Steel, Pakistan only for the government, but also for taxpayers. International Airlines, Port Qasim, National Bank of Pakistan, Central Board of Revenue, Trading These results would have not been possible without Corporation of Pakistan etc. The “Integrity Pact� the commitment, integrity, and professionalism of has been included by the Public Procurement the KW&SB managing director. In an environment Regulatory Authority as a mandatory condition where contract awards are subject to intense for all Tenders. (www.ppra.org.pk ) pulls and pressures, and rules are subject to discretion an example of transparent and merit- The Critical Role of Drivers of based tendering was established. During the entire process, including pre-bid meetings, bid Reform evaluation, and contract award, no negotiations The then Managing Director of KW&SB was were held to change the contract stipulations or critical to the procurement reforms implemented. scope of work, or to reduce contract prices Although it had been envisaged that the demonstration impact of the Integrity Pact Scale up and Expansion applied to the implementation of K-III would The National Accountability Bureau, the national have a spill-over effect across all of KW&SB’s agency for enforcing anticorruption measures, operations, a change in management prevented recognizing the bene�t of the integrity pact in this. Brigadier Sardar Javed Ashraf Khan’s term the K-III Project, decided to make the pact part as managing director of KW&SB lasted one of the National Anticorruption Strategy for all and a half years. The new administration of City future projects with consultants’ fees exceeding District Government Karachi (CDGK) took over US$ 100,000 and construction or works costs after local government elections and did not 9 The Sindh Water Sector Improvement Project of Pakistan aims to improve the ef�ciency and effectiveness of irrigation water distribution in three area water boards (Ghotlu, Nara, and Left Bank), particularly with respect to measures of reliability, equity, and user satisfaction. Total cost of the project is US$ 175 million, with the World Bank’s share US$150.2 million and the Government of Sindh’s US$ 24.8 million. The project period is from July 1, 2007 to April 30, 2011. 25 Table 1: Total Savings in Consultancy and Construction Contracts due to Transparent Procurement in the Greater Karachi Water Supply Scheme (Over 3 years) Nature of Assignment GoP Approved Contract Award Savings (US$) Estimated Cost (US$) Cost (US$) Design & Supervision 5.6 million 1.4 Million 4.2 Million Consultants Construction 120 Million 100 Million 20 Million Contracts Total 125.6 Million 101.4 Million 24.2 Million Source: Transparency International sign the MoU with Transparency International Transparency International. 2006. Handbook for for implementation of the “Integrity Pacts� in Curbing Corruption in Public Procurement. Berlin: Transparency International. contracts. The result was that objectives were only partially met, because the integrity pact ———. Web site: www.transparency.org. could only be applied to one segment of KW&SB projects—procurement of engineering and Transparency International Pakistan. 2003. “Integrity Pact: A Pakistan Success Story.� Karachi. http://www. supervision services for the K-III project. A major transparency.org.pk/documents/kw&sb.pdf. lesson here is the fragility of sustaining the effort through regime or leadership change before ———. Web site: www.transparency.org.pk. the changes have penetrated throughout the institution. Contact details Mr. Saad Rashid References Executive Director OECD (Organisation for Economic Co-operation and Transparency International Pakistan Development). 2002. “Transparency in Government 5-C, 2nd Floor, Khyaban-e-Ittehad, Phase VII Procurement: The Bene�ts of Ef�cient Governance Defence Housing Authority and Orientations for Achieving It.� Document TD/ Karachi, Pakistan TC/WP(2002)31/FINAL, Working Party of the Trade Tel: 0092-21-5390408-9 / 0092-21-5311778 Committee, OECD, Paris. http://www.olis.oecd. Facsimile: 0092-21-5390410 org/olis/2002doc.nsf/LinkTo/NT00000D2A/$FILE/ E-mail: ti.pakistan@gmail.com JT00143801.PDF. www.transparency.org.pk 26 Case Study 4: Program for Transparent Contracting: Morón, Argentina T his case discusses several mechanisms implemented in Morón, for making public procurement for municipal services the intention to transform Morón into a city encouraging civil participation and responding directly to the needs of the community. In order to more transparent: policy reform for broader overcome public mistrust after years of corruption, accountability, partnership with an NGO, and one of Sabatella’s initiatives was the inauguration public consultation through public hearings. This of an Anti-Corruption Of�ce in December 2000. resulted in better and cheaper municipal waste The of�ce, intended to encourage citizens to collection. report corruption by public of�cials, is located on a major street and easily accessible to the Background citizens of Morón. There is also a free telephone line available for the same purpose. Since Most problems in public procurement originate in February 2000, the monthly bulletin “El Municipio� the substantial powers of discretion public of�cials published by the Municipality and distributed to have in designing and awarding public contracts— all households, informs citizens of major projects while other interested parties lack access to crucial and reports on their development. information. To address this problem, Argentine NGO Poder Ciudadano proposed their “Program One of the most important management issues for Transparent Contracting�, a program with two in Morón in 1999 was the contracting of a waste main components: public hearings and integrity collection service for the city. The collection and pacts (IP). discharge of domestic and industrial waste, the manual and mechanic street cleaning and the Poder Ciudadano (http://www.poderciudadano. maintenance of the drainage system as well as org) is a non-pro�t and nonpartisan organization of public parks is one of the most important and in Buenos Aires, Argentina. It was created in 1989, costly issues a municipality has to address. In six years after Argentina’s re democratization, in the case of Morón, a municipality with a relatively order to promote civic participation and generate high degree of �scal autonomy, the bid amounted government-related information of public interest. to roughly US$ 32 million, which represents about Poder Ciudadano was one of the �rst NGOs in 10% of the city’s tax income. Argentina to address democracy, transparency, civil society, and governance. It is also the When Poder Ciudadano offered their “Program Argentine Chapter of Transparency International for Transparent Contracting� to 40 local (TI). governments in the Province of Buenos Aires, only the new mayor of Morón expressed interest Like many other local governments in Greater in having Poder Ciudadano monitor the bidding Buenos Aires, Morón was ruled by a Justicialista for this very important public contracting decision mayor between 1987 and 1999. One particular from the very beginning. Under the previous mayor from this party was suspended, tried, government, Morón had become synonymous and forced to resign under charges of bribery with corruption and administrative chaos. In the in 1991, was re-elected in 1995, and resigned previous contracting of a waste collection service, again under new charges of maladministration. the municipal of�cials were known to have been Morón’s new mayor, 29 year old Martin Sabatella, the owners of the company chosen to deliver took of�ce in December 1999. Given the city’s the service. This had created an atmosphere of history of administrative abuse, the new mayor distrust and suspicion among the citizens. In order made government transparency one of the main to promote citizen participation and transparency goals of his administration. He and his young in this highly important decision making process, team created the Program for Transparency Poder Ciudadano supported the initiative of and Modernization of the Municipality, with the mayor and successfully implemented its 27 “Program for Transparent Contracting� for the Ensuring a Successful Public �rst time in Argentina. Hearing In March 2000, Morón and Poder Ciudadano Several steps are involved in preparing the signed an agreement of cooperation establishing conditions for a successful public hearing (Box 4). the requirements to implement the program for While a law is not necessary to authorize a public municipal waste collection services. The program hearing, guidelines on the process are needed. combined two components: These specify the conditions for the hearing, the documents involved, the form of participation, • Holding a Public Hearing the dates for each stage, the registration process • Signing an Integrity Pact for those interested in taking part, and other procedural issues. Once these guidelines are In 2003, three years after the contract was established, the hearing needs to be broadly awarded, the cost structure of the contract had publicized, and interested parties invited to to be renegotiated. Poder Ciudadano designed participate. In addition to using the media, the a process to introduce transparency to this government must issue special invitations to renegotiation by using public hearings. guarantee a wide range of views. Box 4: Implementing the Program for Transparent Contracting 1. Select a municipality willing to implement the program. To this end, send a project proposal to municipal governments and identify those with a strong willingness to implement reforms. 2. Conclude a cooperation agreement with one or more sincerely interested municipalities to implement the Program for Transparent Contracting. 3. Cooperate with the municipality in conducting a public hearing about the bid documents. If the municipality has no experience in organizing such meetings, Transparency International provides training and advice. Otherwise, TI concentrates on a monitoring role, ensuring that the hearing ful�ls the following formal requirements:  The hearing takes place before the bidding documents are �nalized and before the bidding process begins  The hearings are appropriately advertised in the local media  The invitations to the hearing are distributed more than 30 days prior to the event  The draft bidding documents are available to participants in advance 4. During the public hearing, citizens, bidders, of�cials, and, if possible, independent technical, legal, and economic experts discuss the draft bid documents and have a chance to propose amendments. 5. Within a short time after the hearing, the municipality publishes the �nal bid documents, including the reasons for incorporating or rejecting proposed amendments. 6. The municipality and all interested bidders sign an integrity pact, containing reciprocal commitments not to bribe and not to accept bribes, outlining sanctions, and giving civil society a role in monitoring the bid evaluation, the award decision process, and the implementation of the contract. 7. Monitor the bid evaluation, award decision process, and implementation of the contract 8. Design follow-up projects with the municipality and invite other municipalities to participate 28 At the same time, the government should • Heavy sanctions by the government against establish a small unit responsible for registering any of�cial or bidder violating the no-bribery participants, distributing the available information, commitment, including damages to the and receiving the information submitted by municipality in the amount of 10 percent of interested parties. Before the hearing, a program the contract value and blacklisting for 5 years should be prepared, which includes the list of speakers, the time granted to each speaker, and Citizens Engagement: Reaching the schedule. Service Users An independent party usually monitors the The main strategy of the implementation process process. It can be a local NGO, a group of was to guarantee free access to the draft tender distinguished citizens, or a committee of experts document, and to allow modi�cation of the that have no direct or indirect interest on the document before the initiation of the bidding outcome of the hearing. During the hearing, all process. This was necessary to promote the participants are allowed equal time to highlight participation of the bidders, the unionized workers their positions currently under contract to the municipality, and the taxpaying citizens of Morón. Integrity Pact On June 15, 2000 the Mayor of Morón convened Poder Ciudadano introduced the integrity pact an extraordinary session of the city council concept to the four respective bidders for Morón’s to discuss the draft bidding documents with waste collection contract early in the process, to interested citizens and potential bidders. Posters insure that the new rules were established before throughout Morón announced the public hearing, interested parties had opportunities to enter and all local media were informed about the into alternative arrangements. All four bidders project. Monitored by Poder Ciudadano, the accepted the conditions imposed by the pact meeting was announced in various important without objection, and signed in September 2000. newspapers (La Nacion, Clarin), as well as on The integrity pact contained important mutual local radio and TV. Participants were invited commitments made by the city and the bidders, more than 30 days prior to the event. The draft including the following: documents had been made available online on the Web site of the municipality and were available • A formal voluntary commitment by the in print from Poder Ciudadano. Independent bidders not to bribe or collude; to disclose local experts, including lawyers, engineers, and all payments; and to report any violations by economists, among others, were invited to review other bidders during the bidding process and the documents and present their opinions. during contract execution • A commitment to guarantee: full transparency Nearly 500 people participated in the meeting and of all documentation; public disclosure of the over 60 comments were submitted concerning award; the major elements of the evaluation, the draft bid document. The results of the public and reasons for the selection of the successful hearing were quite signi�cant: consensus was bidder; resolution of any conflict by national reached that the tender lacked objective criteria arbitration detailing the quality of the service required by the municipality, as well as a clear de�nition of the • A corresponding commitment by the Mayor of prerequisites for participation in the process. Morón (on behalf of all of�cials in his of�ce) not to demand or accept any bribes, and As a result, signi�cant changes were made in the to prevent the extortion and acceptance of draft tender to establish more objective criteria bribes by other of�cials for participation and selection. The power of the 29 municipality to easily disqualify proposals, or to Lower Costs, Better Service make decisions driven by vested interests, was Poder Ciudadano’s successful use of public thus minimized. hearings and the integrity pact demonstrated that The draft tender also failed to include speci�cations the process can save cities substantial sums of of the form of service delivery, and acknowledged money. An additional bene�t was the immense the need for an independent arbitrator in cases of spillover in terms of citizen participation and potential complaints made during the process. The involvement. process thus was also opened for participation of • Savings: As a result of the public hearing, foreign companies (which had not been the case the bid documents were revised substantially. before, as municipality of�cials tended to award The terms of the contract were improved so the bids to their local cronies). that the cost to the municipality was reduced Ten days after the meeting, the municipality by 35 percent—a savings of US$13 million published the revised version of the bid compared to the previous contract. The documents along with the reasons for accepting Spanish company chosen offered better or rejecting proposed amendments. Suggestions service for less money. to include more objective criteria for the award • Transparency: A forum was created decision, and to focus regulations on outputs, whereby bidders, external experts, and the rather than inputs, were incorporated in the �nal interested public all presented comments tender document. on or objections to the nature of the service required and the terms for the bidding as part In September 2000 the Mayor and all interested of the decision-making process. bidders signed the integrity pact. Poder Ciudadano monitored the award decision and the • Consensus: Critical decisions about the municipality published the reasoning behind it. service required and the bidding process— the need for an arbitrator, for example—were In 2003, three years after the contract was made by consensus. awarded, the cost structure of the contract had to be renegotiated. Poder Ciudadano again took • Better Service: The involvement of citizens part in the public hearings as an independent and external experts resulted in the changes observer, facilitator, and monitor, and presented described above, and in the extension of the a public report on the deliberations and their tender documents to include environmental outcome. Some 150 community and trade union concerns, including a recycling plan for the members, public of�cials, representatives of collected waste. Professional Associations, universities, and • More Control: The formal integrity pact Chambers of Commerce attended the hearing. provided an important control mechanism for They made a considerable contribution to the the losing bidders to monitor how the winning issues related to the contract adjustment. bidder addressed the terms of the contract, and provided for an independent arbitrator in A high level of civic participation was ensured cases of complaint. by holding public hearings early in the bidding process—giving interested citizens and • Con�dence and Empowerment: The contractors an opportunity to influence the design implementation of the process opened of the bidding documents. The importance of the to public view a previously closed and choice of contractor to the municipality and the stigmatized institution, and empowered the high value of the contract also ensured interest citizens of Morón to monitor the meeting of by both citizens and contractors. the terms of contract. 30 Box 5: Anti-Corruption Initiatives In order to deepen transparency in governance and expand citizen participation, the Municipality of Morón implemented various measures such as the creation of the Of�ce of Access to Public Information and the opening of an Anti-Corruption Of�ce in December 2000, and made government information, such as af�davits from of�cials and staff payroll details, available to all citizens on an of�cial Web site. The Of�ce of Access to Public Information, which began its duties in 2005, is part of the program “Discretion Zero,� which Moron’s Mayor Sabbatella Martin signed with Poder Ciudadano in March 2004. Under Discretion Zero, among other things, the Municipality discloses af�davits of assets of all its of�cials, provides frequent, regular summaries of budget performance, and gives an account of each meeting of the mayor and his staff. Salaries paid to almost 4,000 employees of the Municipality, and all the decrees and orders that are relevant to the commune, are published on the Internet. Moreover, all citizens receive a newsletter in their homes every three months, detailing the actions of the municipality and providing a summary of government revenues and investments. Impact in Morón. A fundamental change towards an ecological use of the waste, the establishment The success of what has widely become known of a recycling system and the implementation as “the Morón case� depended on a large set of environmental education on primary and of transparent and trust- building mechanisms secondary level will largely depend on a reform applied by the Municipality of Morón through of the Provincial laws, which is not expected in out the process. Due to the intervention of Poder the short term. Ciudadano and extensive media coverage, the methodology applied in Morón has been Is Political Will Essential? recognized by many on the provincial level and in other municipalities of Buenos Aires Metropolitan Strong political will at the top of local government Area as a model case. Poder Ciudadano has is a critical precondition for initiating anticorruption already been approached by other municipalities reform. Political will normally coincides with in the Metropolitan Area of Buenos Aires to a change in government— newly formed replicate the same methodology. governments or elections—which provides a window of opportunity for reformers within and In subsequent opinion polls, 80 percent of the outside the government to design a reform citizens expressed their satisfaction with the strategy together. refuse collection service. Clients’ views on service quality are now part of the performance Morón was chosen by Poder Ciudadano as assessment exercises of public of�cials in Morón. a partner for implementing the pilot program because the new political leadership of the city However, some issues still remain to be undertook a broader reform effort and responded resolved. The Pilot Plan designed to develop a very positively to Poder Ciudadano’s offer to program for the recycling of the municipal waste implement the transparent contracting program. cannot be implemented because of conflicts The success of the program clearly depended between the municipal and provincial laws. on the creation of other transparent and trust- The Province is legally the owner of the waste building mechanisms by the municipality (Box 5). produced in 25 municipalities in the outskirts of Buenos Aires and does not allow for political As well as in Morón, Poder Ciudadano has autonomy in this area, making it impossible implemented its Program for Transparent to implement an innovative recycling program Contracting in cooperation with the municipalities 31 Box 6: Examples of Other Public Hearings  A public hearing was implemented in the Province of Mendoza to discuss the bidding and the concession for the Contracting of TETRA, a radio communication system for the local police. The hearing was publicized in two local newspapers and on the city hall Web site. Nearly 60 people attended.  A public hearing was implemented to discuss the terms and conditions of a debt owed by the City Hall of Córdoba to a private company. The hearing was announced in three local newspapers, on two local radio stations, and on the province Web site, and was attended by 120 people. of Buenos Aires10 and Avellaneda11, and the Resource Book: How NGOs Can Use Monitoring and concept of public hearings been used in other Advocacy to Fight Corruption, chapter 9. Washington, DC: Impact Alliance. http://www.impactalliance.org/ municipal projects (Box 6). ev_en.php?ID=12419&ID2=DO_TOPIC. Generic Lessons Poder Ciudadano. Web site: www.poderciudadano. org. Municipalities could prepare a survey before Sohail, M., and S. Cavill. 2007. “Accountability de�ning the object of a bidding process and Arrangements to Combat Corruption: Literature themselves calculate the price for the service Review.� Water, Engineering, and Development Centre wanted instead of depending only on the market (WEDC), Loughborough University, Leicestershire, and the offers of the bidding companies (This U.K. http://wedc.lboro.ac.uk/projects/proj_contents0/ may result in a reduction of public spending) WEJES%20-%20Combat%20Corruption/www/ outputs/Accountability%20Arrangements%20to%20 The surveys prepared by the municipality to Combat%20Corruption%20-%20Literature%20review. evaluate public administration should include all pdf. major decision making processes on municipal Steets, Julia. 2001. “Argentina: Transparent level and should be done by an independent Contracting.� Transparency International, Berlin. http:// surveying institution ( this will increase credibility) www.ucl.ac.uk/dpu-projects/drivers_urb_change/ urb_governance/pdf_trans_corrupt/TI_Steets_2001_ Citizen organizations should encourage Argentina_Programme_Transparent_Contracting.pdf. “neighborhood surveys� to evaluate the quality Transparency International. Web site: www. of services provided by the municipality on a transparency.org. regular basis. This will stimulate communication and involvement among citizens. Contact Details Poder Ciudadano Piedras 547 Timbre 2 - (C.P. C1070AAK) References Buenos Aires - Argentina Holloway, Richard. 2008. “Case Studies in Anti- Tel/Fax: (00-54-11) 4331-4925 Corruption Efforts.� In NGO Corruption Fighters’ E-mail: fundacion@poderciudadano.org 10 The ‘Program for Transparent Contracting was applied in the construction of a new subway line in Buenos Aires, called Linea H. The total cost of this investment project is estimated at about US$1.2 billion. Poder Ciudadano entered the dialogue after a number of companies or consortia of companies had been pre-quali�ed, making it dif�cult to impose new rules on the selection process. The Government of the City of Buenos Aires had in fact at �rst argued that the Integrity Pact needed to be based on a changed law but �nally agreed to use the Integrity Pact on Linea H as a pilot case, assuming voluntary consent by the bidders. 11 The City of Avellaneda did not have any experience with public hearings, and Poder Ciudadano in less than one month trained the staff of the City and then supervised the preparation and execution of the public hearing. 32 Case Study 5: Making the Public Procurement System Work: Naga City, Philippines T he rules for procurement and bidding on projects have long been established by the Philippines government. This case examines engaging them in civic affairs—on the premise that increased citizen participation fuels innovation and results in greater government accountability and how Naga City incorporated transparency and responsiveness.12 Naga City tried to address a civic engagement in the implementation of the twin predicament: lack of resources and increasing rules, and succeeded in reducing public sector demand for services and facilities. Solutions expenditure while increasing service delivery. included a system of partnerships with the private In 2007, Naga City was selected by the United sector and nongovernment organizations and a Nations Development Programme (UNDP) as series of reforms within city hall itself. Revising the a high achiever of the Millennium Development city’s procurement practices formed a crucial part Goals (MDGs). of the internal reforms. Background Challenges in Implementation Naga, a city of more than 150,000 in the and Creating an Enabling Philippines’ Southern Luzon province, is noted Environment for its participatory governance processes and for Building an enabling environment requires mechanisms that have empowered communities nurturing a culture that values innovation, and individual citizens alike. Its efforts toward accountability, adherence to standards, and continuous improvement have ensured the honesty in government transactions. This is �rst a development and deployment of new ways function of leadership. By example, local leaders to engage ordinary residents in governance. must show their commitment to the qualities and Naga’s populace is relatively better off than its standards it expects from government employees. neighboring towns and cities in the Bicol Region, which has six provinces, and seven cities. Its There must also be mechanisms to ensure of�cial poverty incidence as reported by the that the desired culture takes root within the National Statistics Of�ce in early 2000 was 19%, much lower than the national average of around “We started by organizing and reaching out 30%. But beyond socio-economics is the inherent to all sectors of the community – from the attitude of Nagauenos (citizens of Naga City) ambulant to the market vendors, jeepney drivers, farmers and labour groups to the civic to demand performance from their government, clubs, professional associations, business and to participate in the public discourse of local leaders and non-government organizations. and national issues. As a result, participating in To secure their trust and con�dence, we governance is not alien to them. tackled head-on longstanding problems that hound the community – vice, urban blight, red In the late 1980s, the city was in a state of tape, and graft and corruption. We worked to economic decline, with a large municipal de�cit, make local government as transparent as high unemployment, low business con�dence, and possible. Speci�cally, we worked to break little government accountability or transparency. down an old patronage system that has fostered corruption and crippled the ability of Incoming Mayor Jesse Robredo believed in the people to think and work for themselves.� potential of information technologies to bring about Source: Jesse M Robredo. “The Naga City Case: a more inclusive and effective governance model. Communicating Local Governance Strategies to Once in of�ce, he supported the development of Transform a Community.� Speech delivered at the 2006 Asia Paci�c Communication Conference, Makati City e-governance initiatives giving citizens greater on March 30, 2006. access to decision-making processes and 12 Mayors in the Philippines are powerful; especially since the 1991 Local Government Autonomy Act, they wield signi�cantly greater �nancial power. 33 government. In Naga City, this started with the Robredo envisioned that this would enable the 1988 Productivity Improvement Program (PIP), a city’s residents to fully use the services provided program that aimed to transform city government by their government—and tell of�cials and personnel from being process-oriented to results- employees when they were performing below oriented. expectations (Box 7). PIP focused on improving and setting standards The i-Governance Program aims to achieve: for the delivery of city services. Each of�ce at city • Inclusive governance hall had a “Performance Pledge�— a contract of deliverables specifying the of�ce’s services, • Information openness persons responsible, and promised response • Interactive engagement time. It is displayed in conspicuous areas and • Innovative management can be used by constituents and clients to hold an of�ce or person accountable. Through public posting of Naga City’s budget on the Internet, government agencies are constantly The main message is that city hall is being reminded of the requirement to streamline and benchmarked similarly to the private sector. The improve ef�ciency. One result— streamlining City Engineer’s Of�ce, for example, knows that its of personnel services—has enabled city project estimates will not be compared to similar government to channel a greater proportion of government projects, but to estimates from the funds into service provision. private sector for the same project. Complementing this effort were logos and Increasing transparency in the procurement slogans13 that conveyed the vision for the city process ensures wider participation of quali�ed and the kind or “brand� of governance being providers and gives the city government a control promulgated—reinforcing the messages of mechanism to ensure that the system works. partnership, participation, and progress. It makes government more accountable and provides feedback mechanisms that can help government source lower prices for goods and Citizens Engagement services. Several measures have been institutionalized to ensure transparency, not only in the procurement After PIP, recounts Mayor Jesse Robredo, process but in their outcomes, as well. Among “The challenge then was how to engage with these are: the households. So probably a majority are interested in making sure that when they apply Wider dissemination of notices of bids. These for a permit, everything is in order. They get it are now not only posted on bulletin boards or as correctly and as quickly as they can. They’re circulated in newspapers, but also disseminated interested in busted street lamps at the corners through radio and television. Authorities also near their houses. They’re interested in clogged send notices to all accredited bidders. drainages, garbage being collected, and the like.� The resulting initiative is called i-Governance (i to Participation by non-governmental reflect the project’s inclusive, information-open, organizations. In 1997, city government took interactive, and innovative characteristics) and the concept of NGO participation in governance gives Nagueños information about their local a step forward through landmark legislation: the government. It seeks to increase opportunities “Empowerment Ordinance of the City of Naga.� A for individual stakeholdership in city governance. Naga City People’s Council (NCPC) composed 13 The Program was captured more succinctly by the battlecry: “Kauswagan kan Naga—Kun Bako. Literally, it means “Naga’s Progress—If Not Now, When?� 34 Box 7: The i-Governance Program i-Governance has three features: a citizens’ charter; a website; and texting. The Naga City Citizens Charter is a guidebook on the city government’s key services, each of which gets a detailed description. There are step-by-step instructions on how to use each service, the standard response time for its delivery, and the City Hall of�cers and staff responsible for its operation. There is also a list of requirements a customer must comply with to facilitate service delivery, plus location maps of the departments handling the enumerated services. The Web site, naga.gov.ph, meanwhile, caters to Naga residents with Internet connectivity. The site provides accurate, relevant and essential information about Naga, including an extensive city pro�le, urban indicators and statistics, tourism assets, investment opportunities, and downloadable maps and tables. An online component of the Web site called NetServe has an extensive catalogue of City Hall’s services and, just like the charter, lists procedures, response time, and responsible personnel for each of these. Plus, it contains information about the city’s �nances, including the annual city budget; postings of biddings and public offerings and their outcomes; city ordinances and resolutions; and a directory of city of�cials, complete with their contact numbers and email addresses. TextServe is a cell phone-based service that allows Naga residents to send queries and feedback to the city government through short message service (SMS) or text. Launched in April 2003, Nagueños have been using it to comment on development programs and policies, as well as to complain, usually about drainage systems and collection of fees. On average, we receive 20 text messages per day but it can go as high as 50 messages when there are major issues facing the city. A text message is automatically responded to with a system-generated acknowledgement to the sender and assurance that his concern will be acted upon. A human controller routes the messages to the appropriate department for action and such information is sent back to the sender. The department in turn must feedback to the sender within three days the action taken. i-Governance’s concomitant streamlining of processes and computerization of basic applications has dramatically improved the delivery of city hall’s frontline services. For instance, the determination of business and real property tax due has been reduced from four hours to one minute. Birth certi�cates are now issued within 30 minutes when in the past it took almost a week’s wait. The processing of mayor’s permits is down to half an hour from two hours; and building permits, from 15 days (as mandated by the National Building Code) to just �ve days. of all accredited business, nongovernment, necessary expertise and information to evaluate and people’s organizations within the city was project estimates and bids, it has encouraged established with duties including appointing individuals and other NGOs to participate in representatives to local special bodies (Box 8) various phases of procurement processes. For example, the Philippine Institute of Civil Engineers The Naga City People’s Council (NCPC) is a highly has a representative in the Pre-Quali�cation, Bids independent body, amounting to city government and Awards Committee. The representative is putting a watchdog over itself. As regards the able to provide valuable input on how the private procurement process, it is the NCPC that selects sector would undertake a civil works project, and a representative to the Pre-Quali�cation, Bids has been instrumental in identifying items that and Awards Committee. can be removed from estimates or programs of As city government does not have all the work. 35 Box 8: Special Local Bodies established under the “Empowerment Ordinance of the City of Naga� • City Development Council – this body is composed of representatives of national government agencies with of�ces in the city, city government of�cials (executive and legislative) the private sector and non-government organizations and people’s organizations. The law creating the Council mandates that 25% of the membership should come from civil society, in Naga’s case its more than 40% of the membership the selection of which is done by the Naga City People’s Council (NCPC). • Naga City Investment Board– established by the city to craft and recommend policies and pass upon applications for incentives. It is chaired by the private sector and had 50% of its membership designated by the NCPC. • Naga City Health Board – charged with oversight powers over health-related of�ces of the city government, it recommends policy measures to the executive and local legislature. One-half of its membership come from the professional medical organizations (e.g. Camarines Sur Medical society and Camarines Sur Dental Society), representatives of key health facilities run by the national government and the private sector, and NGO representatives, the latter designated by the NCPC. The rest are from the city government. • Naga City Peace and Order Council- tasked with reviewing programs of city departments responsible for public safety, one-fourth of its membership. • Naga City Women’s Council – majority of its membership comes from civil society designated by the NCPC Beginning in September 2006, city government, • Working with existing and mandated through its local planning of�ce, began updating local councils and special bodies as its development and land use plans. This basic planning units. This involves tapping provided an opportunity to further institutionalize such councils—which all have strong participative approaches in local governance civil society representation—to create processes and the adoption of several sectoral components in both land use and innovations: development plans under the umbrella of the City Development Council. For example, • Using the Millennium Development with regard to the social sector, the city works Goals (MDGs) and the Public Governance with groups representing children, women, Scorecard (PGS) vision–mission statement youth, senior citizens, and the urban poor in and scorecards as planning targets. This establishing baseline data; assessing needs; means the city will no longer need to reinvent crafting and costing programs, projects, and the wheel with a time-consuming visioning activities that will respond to these needs process. Instead, it will update the local land in the context of the MDG and PGS targets use and development plans with a nine-year and laying out a nine-year action plan for time horizon. The previous planning horizon implementation, monitoring, and evaluation. was �ve years. The current planning horizon was influenced by the 2015 deadline of the • Creating stronger partnerships with MDGs. The planning process will therefore academia. Cognizant of its limited technical focus on revisiting outputs, re�ning targets, expertise in some areas of urban management, and aligning plans toward attaining these the city tapped graduate students from nine-year targets. the University of British Columbia School 36 of Community and Regional Planning in • Supplies – savings up to 33 percent compared Vancouver, Canada to join students from the to local government standards Ateneo de Naga University—to research six These refer to cost savings. The �gures quoted areas vital to city development: transportation are based on cost �gures culled from 2002-03 and land use planning; investment promotion; procurements. The �gures vary from time to time. urban agriculture; youth development; and The gap in procurement cost of the city and those social housing and education. Their results of national agencies, particularly the Department are another invaluable input to the planning of Public Works and highways, is substantial process and have revitalized partnerships. however. All of the initiatives and innovations the city has put The City Accountant’s Of�ce estimates savings in place ensure that all citizens, from the well-off of at least PhP 10 million (over 200,000 USD) to the underserved, can participate in and bene�t a year through transparent procurement. from the city’s development and land use plans. I-Governance and ICT-DEV (ICT DEV refers to the computerization of payroll, property tax Ensuring Quality and Objectivity collection and business tax collection) contributed The city developed a sunshine policy to provide for to an increase in local revenues from PhP 13 transparent public transactions. Under this policy million (275,000 USD) in 1988 to PhP 132 million it is required that bidding announcements, aside (2,801,474 USD) in 2002, sustaining the growth from the required publications in newspapers, of Naga City (economic growth is estimated by must be posted on bulletin boards of parishes, the Asian Development Bank at an average of chambers of commerce, the Rotary, and other 6.5 per cent annually). ICT-DEV was instrumental civic-spirited organizations. Such bidding notices in increasing local government income by 76 must also be aired on local TV and radio. At the percent–112 per cent and reducing operating local level, this entails no extra cost because costs through manpower reductions and improved such organizations, including the local radio personnel productivity. This has provided the city stations, are quite willing to accommodate with more funds for its growth and equity-building bidding announcements for the public good. The programs. In addition, streamlining of processes city’s sunshine policy has drastically reduced and the computerization of common applications the opportunity for collusion among bidders and has improved service delivery times. contractors. This and other city procurement There is little new in the way the Naga City practices have resulted in signi�cant cost government has been able to attain relatively reductions in the cost of social services, items lower costs for supplies, equipment, and purchased and civil works projects bid. infrastructure projects. The rules for procurement • Road construction – savings of 38 percent and bidding have long been established by the per kilometer of road compared to national national government. What makes Naga different government standards is that it has tried to implement the rules. • Asphalt overlays – savings of 47 per cent Drivers of Change • Public school classroom – savings of 36 Naga City has creatively used a decentralization percent policy to support diverse goals such as reducing • Medicine – savings of 19-70 percent poverty, promoting economic productivity, compared to other local government units, social justice, and community participation in 62 percent compared to branded products the delivery of basic services, and building imported by the national government urban infrastructures. Guided by experience in 37 engaging with constituents, the city has evolved Naga City is nationally and internationally its own governance model, which may be useful recognized for its innovations, whose common when considering replicability. In this model, denominator is the premium placed on citizen three elements form the foundation of good urban participation in governance. These innovations governance: include the initiatives described above and more, which all result in a more transparent Progressive perspective is at the apex of the local authority, good quality yet cost-effective triangle because it is a function of leadership that public services, a vibrant and inclusive urban the local administration must provide. Among community, and a society of empowered citizens. other goals, a progressive perspective seeks to build prosperity for the community at large. The Importantly, many of these outcomes are goal of prosperity building is informed by an measurable. The Kaantabay social housing14 enlightened perception of the poor; uplifting this outcomes are a case in point. Another recent proof group is a goal of governance. that the city’s people-centric approach works was an af�rmation in relation to the Millennium Development Goals (MDGs). In 2007, the Progressive United Nations Development Program selected perspective Naga as one of ten leading-edge Philippine local communities in progressing towards and attaining the MDGs. Naga was given recognition for its MDG aligned local programs and its role as the �rst MDG resource city (learning Good urban laboratory) in the Philippines. As a resource city, governance it showed other cities how one can localize and mainstream MDGs. A progress monitoring report Partnerships Participation commissioned by the Philippine government showed that the city had already attained or is on track towards attaining all MDG indicators. The Naga Governance Model In 2006, Naga beat bigger and richer urban Functional partnerships are vehicles that enable centers like Manila, Makati, Cebu, Marikina, the city to tap community resources for priority and Davao when it was recognized as the undertakings, in the process multiplying its capacity “Most Business-Friendly City� by the Philippine and enabling it to overcome resource constraints Chamber of Commerce and Industry—for the that usually impede government action. third time. The Naga City experience shows that the present Participation mechanisms ensure long-term government procurement system can work. sustainability by generating broad-based However, the focus should be on more than stakeholder and community ownership of local guidelines and procedures, although they have undertakings. Partnerships and participation lie their own value. Ultimately, it is the people and at the base of the triangle because they are the institutions that ensure that government gets the elements that provide sustainability. 14 The Kaantabay sa Kauswagan (or Partners in Development) Program is aims to empower squatters and slum dwellers. Anchored in the belief that the urban poor are a vital sector in Naga’s quest for total development, the program addresses the sector’s two main problems—absence of security of land tenure and lack of basic infrastructure and facilities—primarily by adopting a “partner-bene�ciary� perspective in dealing with clients. Kaantabay sa Kauswagan’s most important achievement to date was institutionalization of a mechanism that effectively addresses the sector’s pressing problems. This mechanism brings together government agencies, urban poor associations and their allied NGOs, and private landowners to solve standing tenurial problems with �nality. Today, all land problems involving the urban poor in Naga are referred to and pass through this mechanism. 38 “best deal.� This requires building an environment of Philippine Local Government Units (LGUs). that values service and cost standards. Good So were several other initiatives (e.g., a more practices must be reinforced while improper ones outcome-oriented School Board, the Metro Naga must be exposed to public scrutiny. This is where Development Council which is an inter-LGU transparency and participation are invaluable. partnership among Naga and 14 neighboring towns). The case of Naga City has shown some of the conditions and strategies that allow good political leadership and collaborative government–civil References society interactions to make decentralization an Angeles, Leonora C. (no date) “Renegotiating effective instrument of participatory planning and Decentralization and State–Civil Society Relations: A Re-interpretation of Naga City’s Experiment in governance. Participatory Governance.� http://www.naga.gov.ph/ The present administration has been re-elected cityhall/DR_ANGELES.pdf. seven times already with an interregnum of one Naga City, Philippines. Web site: www.naga.gov.ph. term (under the Local Government Code, local Robredo, Jesse M. 2006. “Governance and Social of�cials can serve for only three successive Accountability Mechanisms: Naga City, Philippines.� terms.) The present administration’s initial Paper presented during the Governance and Social term was not covered by this limitation, the Accountability Forum, September 18, in conjunction with succeeding six terms were covered thus the the World Bank and IMF Annual Meeting, Singapore. interregnum of one term wherein an ally of the http://www.naga.gov.ph/cityhall/IMF_09182006.pdf. present administration was elected as mayor. In ———. 2007. “Engaging People in Local Government: essence then, there was not much of a change The Experience of Naga City, Philippines.� Paper in the political leadership. What is noteworthy presented during the Conference on Active Citizenship and Social Accountability, sponsored by the Australian is that from the second to the present term, the Council for International Development (ACFID), July people elected all the candidates on the ticket of 3, at Monash University, Victoria, Australia. http://www. the incumbent mayor. naga.gov.ph/cityhall/ACFID_07032007.pdf. Rodriguez, Luz Lopez, and Brian Min. 2003. Impact “i-Governance in Naga City, Philippines: An Innovations in Technology and Governance Case Study.� http:// The citizen’s charter pioneered by Naga, which www.comminit.com/en/node/147718. catalogues the services rendered by each department and of�ce of the city government, how to access them, who is the employee responsible, Contact Details etc is now mandatory on all Philippines provinces, frankmm@naga.gov.ph towns and cities by virtue of a recently enacted national law. The empowerment ordinance, which institutionalized civil society participation at the policy level, was likewise adopted by a number 39 Case Study 6: The OPEN System: Municipality of Seoul, South Korea T he Seoul Metropolitan Government’s OPEN system makes all processes of civil affairs administration, from acceptance to �nal Citizens’ Engagement Of�cials are now assigned on a daily basis to handle applications submitted from different processing, publicly available on the Internet. areas. For a direct and convenient interface with the citizens, and to target corruption, the Seoul Background Municipal Government created an Internet portal In the Municipality of Seoul, South Korea, the (Box 9) called OPEN, symbolizing that it opens mayor has insisted that all transactions between administrative procedures to the public. The portal the citizens and the municipality are posted on an explains the various elements of the anticorruption open Internet Web site. This is one facet of The drive, displays an anticorruption index and survey OPEN system (Online Procedures Enhancement results, educates citizens on rules and procedures, for Civil Applications), devised with the intention and as noted, provides real-time monitoring of the of targeting and addressing corruption. progress of a permit or license application. The system publishes a variety of information A review team composed of staff experienced in related to the services, permits, and licenses audit and inspection was set up on February 1, issued by the local government. The applicant 1999 to determine which municipal government can track the status of any application on the activities should be made open to the public. The Web site. For example, applications for building team analyzed the entire array of civil permits licenses are processed automatically, and and approvals by title, processing procedures, information accessible by anyone, at any time, susceptibility to corruption, and types of can show when the application was requested irregularities. The twenty six categories of civil and granted, and the time it took for the process applications published on the Web are those to be completed. This, together with the public that most frequently cause irregularities and announcement of the costs of all transactions with inconvenience to citizens due to the complexity the municipality, has removed the discretionary powers of government of�cials and has reduced Box 9: Objectives of the OPEN corruption considerably. System To ensure transparency in administrative Issue to be addressed procedures: Information on civil applications, Rapid economic growth in Seoul has been procedure of approvals, document reviews, accompanied by an expansion of the municipal schedules, etc. can be viewed on the Internet bureaucracy. The extensive municipal regulations To provide citizens’ easy access to civil also created new opportunities for corruption. applications processing: Citizens can monitor Some bribes were meant to be insurance fees the processing of civil applications on the to avoid unfavorable treatment, others were Internet anytime, anywhere, without making honorariums for preferential treatment, and still telephone calls or visiting government of�ces, others were express fees to facilitate speedy reversing the long-standing policies that kept processing. ongoing processes unknown to the public With the inauguration of Mayor Goh in 1998, To increase credibility of the city Seoul City declared an all out war on corruption. administration: Offering all citizens To minimize the potential for collusion, the access to information a sense that the city longstanding practice of giving one individual administration is fair and objective, reducing jurisdiction over permits, approvals, or inspections public distrust within a particular geographic area was abolished. 40 Box 10 : Changes in the Handling System for Multiple Stakeholders Citizens: Able to check who is handling their applications, whether there is any problem, and when applications are expected to be done. Reduced need for phone calls and face-to-face meetings Civil Servants: Fewer applicants’ phone calls and face-to-face meetings. Process applications in timely manner (paperwork), Then, enter the results into the OPEN System in 10 working hours (online work). No labour force added (no increase cost to government) Audit and Inspection Bureau (Mayor): Any delays and mistakes directly reported by the OPEN System. Improvement of monitoring and control of the processing procedure, and those whose The OPEN system requires that at each review publication is expected to curb requests for stage, the relevant of�cial input the date and concessions. Information about required time when each application is processed. Free paperwork and how applications are processed access to the status of an application eliminates is provided for each procedure. The system also applicants’ feeling a need to contact of�cials or includes information on the city department in to offer a bribe to complete the process. Return charge, staff-in-charge, and a telephone number. postcards are sent to those who have applied All application documents provide an email for permits or approvals from the municipal address so people can easily ask questions or government, ensuring some feedback. The make comments directly to the staff-in-charge results of these surveys form part of a new “Anti- (Box 10). Corruption Index� (Box 11). Box 11: The New Anti-Corruption Index Seoul City introduced an Anti-Corruption Index (ACI) in 1999. The �rst of its kind in Korea, the ACI is primarily designed to assess the level of integrity of the city’s departments and autonomous districts. By making this public, the ACI intends to induce the Seoul Metropolitan Government and the autonomous districts to eradicate corruption, increase the level of integrity among public of�cials, and establish a more transparent government. One should add here that while Transparency International’s Corruption Perception Index is derived from international opinion polls, Seoul’s Anti-Corruption Index is calculated on the basis of opinion polls among those who submitted applications during the past year. This being the case, back in 1999, Gallop Korea was given the task of carrying out the survey for the Anti-Corruption Index. Eventually, seven different administrative aspects of the Seoul Metropolitan Government were surveyed, including the �ve civil affairs �elds of sanitation, taxation, housing and architecture, construction, and �re prevention and control. On a later date, two additional �elds, transportation administration and park and landscape, were added to this survey. On a scale of zero to one hundred, the latter being the highest possible index point for administrative integrity, it should be noted that the overall average of the Anti-Corruption Index in the previous mentioned seven �elds was 68.3. Fire prevention and control scored the highest at 72.8, followed by sanitation at 68.9, housing and architecture at 65.9, and taxation at 65.8, while the transportation administration and park and landscape, which were newly installed in 2000, scored 69.1 and 67.0 points, respectively. 41 Social and Political Context reducing the probability of corruption at the level of municipal governance. The development of the system continued from February to March 1999, followed by an internal test operation in early April. The system was Simplifying Regulations opened to the public on April 15, 1999. The The focus of the anticorruption program was City of Seoul’s key ingredient for the successful not on technology but on simplifying regulations completion of such an extensive task in just ten and procedures, re-engineering work practices, weeks was the commitment demonstrated by all increasing transparency in procedures, and parties involved in implementation. Mayor Goh improving communication with citizens. Kun demonstrated strong commitment to make Technology has been simply an enabler, available all relevant information to the public particularly in building a transparent tracking by encouraging government of�cials, who are system for permit and license applications. traditionally reluctant, to disclose information, by checking every step of the system’s Since the start of its operation, the OPEN System development phase, and by encouraging the has added several more services, to the initial 26 project team. services accessible to the public—a total of 54 services, including construction, transportation, The initial development cost was 421,900,000 urban planning, culture and tourism, environment, Won (US$ 319,308), which included program women and welfare and industry and economy development and hardware and software among others are now available. procurement. These costs include an allowance for additional hardware needed in the future Deregulation has been a core element of by system users. Three city computer experts the action plan. By May 2000, 392 municipal maintain the OPEN system. regulations had been eliminated, 203 eased, and Toward the end of the development of the system, another 3,897 improved leading to greater clarity training workshops on system development and limiting confusing overlaps. and data input were held for 4,000 employees from 485 departments whose information on Impact of Mechanism- An Anti administrative procedures was to be disclosed. Corruption Culture Personnel from related departments completed A survey in April 2004 on the Internet among 606 input practice sessions that simulated real-life OPEN system users showed 69 percent (417 situations in conference rooms equipped with users) of the respondents were satis�ed with the computers. Identities and passwords for the system. Moreover, 64 percent (388 users) replied OPEN System were provided for the personnel that the OPEN system contributes to securing assigned to the task, enabling them to input data transparency in city administration and preventing on services underway. corruption. The Seoul Metropolitan Government, The OPEN system appears on the homepage of as part of its anticorruption index, has carried the Seoul Metropolitan Government (http://open. out surveys each year since 1999 to assess seoul.go.kr). Additional channels of direct dialogue the level of transparency in city government. have been opened between citizens and the This survey explores citizens’ own experiences, mayor. Examples include hotlines, email, and the asking if they have personally witnessed “Mayor’s Saturday Date with Citizens� program. corruption by city government of�cials. This is The OPEN system is an excellent example of the done through a ‘Happy Call Service’. Within a strategic application of information technology couple of weeks after the public complaints are that enables better access to information related resolved, this service is provided to citizens to citizen services and queries—signi�cantly 42 whose public complaints are dealt with by the on in a meeting of vice-ministers (October 28, Seoul Metropolitan Government. The Seoul 1999) and a Cabinet meeting (November 2, Metropolitan Government’s representatives call 1999). In 2001, when Seoul co-hosted the Seoul citizens and ask if they observe any corrupt Anti-Corruption Symposium with the United practices while their public complaints are dealt Nations, the OPEN system was hailed as an with; if public of�cials ask for money in return for internationally approved anticorruption system. In service; and if the public of�cials are kind and the symposium, the system’s effectiveness was courteous throughout the service. In the year recognized, as it was found to have enhanced 2008, only 3 out of a total of 1000 respondents transparency and restored public trust in civic said that they found public of�cials to be corrupt. administrations. It was suggested that the (And those public of�cials who have found to be manual be provided for countries that wish to corrupt are subject to punishment.) introduce the system by mutual agreement with A survey by the Audit & Inspection Division of the UN. As of this writing, the manual for the those seeking services from the city government OPEN system has been printed in six different showed that favorable opinions about the kindness of�cial languages of the United Nations. The of civil servants increased signi�cantly from 54.8 Anticorruption Committee of the Korean national percent in December 1998 to 71.2 percent in June government applied the anticorruption index 1999. Results from a survey of 1,245 citizens in initiated by the Seoul Metropolitan Government to the year 2000 showed that 84.3 percent believed all departments of national and local government that OPEN led to greater transparency and 72.3 in 2002. percent of the respondents again expressed their Today, the OPEN system also applies to business satisfaction with the system.15 contracts with civil parties with regard to material Furthermore, according to surveys in March and procurement, construction works, or construction April 2001, of 48,000 people who had submitted superintendent services. The use of the OPEN their civil applications to the Seoul Metropolitan System is expected to be extended in the near Government and Ku (district) of�ces in the future to include almost every commercial trading previous year, over 86 percent of the respondents transaction between individuals, as well.16 said that the process of civil application became simpler and more ef�cient. As for opinions of Drivers of Change the OPEN system’s anticorruption effects, the respondents said that the system appeared There were problems to overcome before to be very effective in controlling corruption in successful implementation of the OPEN system housing, construction work, and city planning, but could take place. One was the uncooperative ineffective in general administration, culture and attitude of some employees in municipal tourism, and public hygiene. clerical of�ces and their objections to of�ce computerization. Another typical objection, in In 1999, the �rst year surveyed, the anticorruption this case among municipal of�cials, was that index was 64.0. It has improved continuously the OPEN system would greatly reduce their since then, reaching 77 in 2004. discretionary power and that the system’s data The national government showed great interest in input requirements would signi�cantly increase the success of the OPEN system. It was reported their workload. 15 Survey conducted by Gallup Korea from November 24 to December 13, 1999. 16 The Seoul Metropolitan Government has also installed a range of systematic methods and anti-corruption policies, apart from the OPEN system, and has achieved fairly good results in improving integrity in the administrative services provided. New initiatives include: * The “Clean Contract System� to prevent irregularities in processing public contracts. * The “Civil Auditor System� to encourage direct participation by representatives of NGOs and other civil society associations in city government auditing processes. 43 and allow data integration across applications for “While in of�ce as Seoul’s mayor for four years, improved intelligence. Moreover, e-government I witnessed city of�cials become reformers, can make decisions traceable. As the possibility not the target of reform, so well that they of exposure of wrongdoing increases, the fear could eliminate the infamous longstanding of embarrassment can be a deterrent to corrupt title of Seoul City— “Pandemonium�— fraught practices. Publishing government information with irregularities after Japan’s colonial rule. on the Web built accountability by providing Such reforms— �ghting corruption—could documentation to citizens to substantiate not have been achieved only by the mayor. It complaints against corrupt practices and also needed city of�cials who initiated them. providing evidence of government competence I consider one of my roles to be changing all and transparency. of�ceholders to reformers, not the target of reforms, so I will endeavour to urge of�cialdom References to be in the vanguard of changes and reforms “A Compact Brochure on Seoul City’s Anti-Corruption ahead of other sectors. To this end, besides Programs: Clean and Transparent.� 2001. Seoul measures aimed to boost their morale, the Metropolitan Government, Republic of Korea. most important thing to do, �rst of all, is to Ahn, Suntai. “Implementation of Anti-Corruption provide the motivation for reforms and make Programmes by Seoul Metropolitan Government: The them �nd worthwhile doing and sharing the Case of the OPEN System and Its Future Prospects.� sympathy for the cause.� www.oecd.org/dataoecd/45/32/2409225.pdf. Prime Minister Goh Kun, former Mayor of “Interview with Mayor Myung-Bak Lee of the City of Seoul, in an interview in March 2003 Seoul, Republic of Korea.� 2005. April 12, Governance Source: News World, March 2003 International, Birmingham, U.K. http://www. governanceinternational.org/english/interview18.html. http://www.newsworld.co.kr/cont/0305/14.html OPEN System, Seoul, Republic of Korea. Web site In due course, of�cials began to see the merits (English): http://english.seoul.go.kr/gover/initiatives/ of the system. It saved time and money for both inti_open_system.htm. public servants and citizens. Citizens no longer ———. Web site (Korean): http://open.seoul.go.kr. had to come to city hall in person to submit their complaints, and, as a result, public of�cials’ time World Bank. 2000. “OPEN: Seoul’s Anticorruption was being used more ef�ciently, as well. Project.� Audits and Inspections Division, World Bank, Washington, DC. http://go.worldbank.org/ Commitment from the top (in this case, the mayor) MOXKXR9RV0. was a key driver of the OPEN initiative’s success. Adequate resources were provided for the project Contact Details and there was signi�cant participation from line Seoul Metropolitan Government management in carrying out systems analysis. Euljiro 1, Jung-gu, Seoul 100-744, Republic of Korea Seoul’s OPEN system illustrates how e-mail: audit@metro.seoul.kr For Inquires on e-Government: e-government can become one of the key Information System Planning Division components of a broader anticorruption strategy. Tel: +82-2-3707-9173 The e-government process provides centralized Fax: +82-2-3707-9189 data that will improve audits and analyses; permit http://e-seoul.go.kr unbiased sampling procedures for audit purposes; Email: info@seoul.go.kr 44 Case Study 7: Tracking Government Service Delivery: Public Service Accountability Monitor (PSAM), South Africa T his case highlights how the PSAM, a program of the Centre for Social Accountability (CSA) undertakes research and advocacy in region by generating, disseminating and sharing knowledge about the right to social accountability and the tools necessary to give effect to this right. the Eastern Cape Province of South Africa. The The PSAM produces research and monitors the PSAM promotes transparent and accountable following key service delivery departments of governance through its various outputs and the Eastern Cape Province: Health, Education, interventions, which seek to empower citizens Housing and Social Development. and the provincial legislature’s oversight function, while also engaging government and a wider The Easter Cape Province has historically been network of civil society organizations. perceived as one of the most corrupt in South Africa. The PSAM commenced operation as an institute af�liated to Rhodes University with its Background research and case monitoring focus directed The PSAM has been engaged in social towards issues within the Eastern Cape. The accountability monitoring since 1999. In 2007 province has a large rural and poverty affected the PSAM became a programme of the newly population who are highly dependent upon established Centre for Social Accountability the state for the provision of services and the (CSA) which is an independent institute af�liated progressive realization of constitutional rights. to Rhodes University and based in the Eastern Systemic challenges faced by government Cape Province of South Africa (Box 12). within this region prompted PSAM’s focus on the Eastern Cape initially. The centre’s vision is the institutionalisation of the right to social accountability and the realisation of The organization is funded by the Swiss Agency social and economic rights through the effective for Development and Cooperation, the Open management of public resources. It seeks to Society Initiative for Southern Africa, the Gates achieve this vision in the Southern African Foundation and the Ford Foundation. Box 12: Centre for Social Accountability (CSA) The CSA aims to realize its vision through two main programs: PSAM: The PSAM aims to improve public service delivery and the progressive realisation of constitutional rights to healthcare, education, social security and housing by using various social accountability monitoring tools (relating to resource allocation, strategic planning, performance monitoring, expenditure management, integrity and oversight processes). These tools have been developed in order to systematically monitor the public resource management cycle, enabling citizens to hold government of�cials accountable for the delivery of services and the performance of their duties. Training: An 11-day course on the Fundamentals of Social Accountability is offered three times a year to 20 participants from throughout Southern Africa. Country Consultation Visits are held with civic actors in Southern African countries to share social accountability monitoring approaches and to exchange budget and monitoring tools and experiences. Country Consultation Reports are then co-written with regional partners and seek to document different approaches to social accountability monitoring, experiences and tools. The report provides a detailed account of the resource management framework and recommends additional monitoring entry points. The report is then shared with civic actors through workshops in the relevant country and disseminated in the region. In-country exposure workshops are presented in response to requests by partner organizations for training on how to implement the CSA’s social accountability monitoring methodology/tools. 45 Citizen’s Engagement relevant individuals report directly to the court on the performance of required corrective action and The PSAM is prioritizing its engagement with civic on compliance with their statutory duties. partners, encouraging them to participate in more inclusive joint advocacy strategies around the �ndings and recommendations of their outputs. Judging bene�ts and It has developed a research methodology satisfaction level that enables persons to utilize the research, The PSAM produces various annual research monitoring and advocacy tools (employed outputs which assess government’s performance by PSAM) at various stages within the public in the areas of education, health, housing and social resource management framework of a state. development. These outputs can be downloaded off the website www.psam.org.za. Certain outputs The PSAM currently: have emphasized audit �ndings and investigations • assesses select departmental strategic which have revealed widespread misuse of funds plans; and the presence of theft, fraud, corruption and irregular procurement activities. • evaluates certain departmental budgets against plans and policy priorities; The various research outputs are produced to coincide with the public resource management • monitors and assesses departmental framework/calendar of the South African expenditure; government. The PSAM collects a range of • monitors and assesses performance government reports and documents which are management processes within select periodically produced. Documents collected departments include: budget statements, policy speeches, • considers integrity systems operating within strategic plans, operational plans, annual certain departments reports; the reports of oversight bodies such as the Auditor-General’s of�ce; and minutes of • considers the extent to which departments parliamentary committee meetings and so forth. account to the Legislature and the Auditor- General. These documents are then considered and assessed during the production of the following Following recent access to information litigation research outputs: Budget Analyses and Strategic successes, the PSAM intends to make increased Plan Evaluations (produced between April and use of access to information legislation to obtain June each year), Occasional Research Reports copies of documents which remain outside (produced between July and October each year); of the public domain. The PSAM also intends Service Delivery Reviews (November/December using administrative justice legislation to obtain each year and Accountability to Oversight explanations for decisions taken. Reports (January/February each year). The PSAM publishes its �ndings on a regular basis In addition, if by 2010 the PSAM has not discerned (See Box 13). a notable improvement in the performance of certain departments in implementing basic The PSAM aims to provide members of expenditure management, and public integrity parliament, civil society organizations, and management controls in response to repetitive citizens with credible evidence, information and �ndings of the Auditor-General, it plans to tools that will enable them to participate in the approach the High Court with an application for a promotion of democracy while holding government structural interdict against offending department accountable. The PSAM also aims to provide heads. Such an interdict will seek to have the government with information that will assist in the 46 Box 13: How PSAM reaches its target audiences • Research outputs are submitted and/or presented to the legislature, government departments and interested parties. • Press releases distributed to various media. • Responding to journalists’ requests for comment on speci�c issues • Workshops held to report research and monitoring �ndings to civil society organisations and advocacy groups • Comprehensive PSAM website offering access to all PSAM publications and other information • Papers presented at seminars/conferences by PSAM staff. • “Know your rights’ booklets produced and circulates amongst communities, • CSA annual report. • The CSA’s training programme shares the PSAM research, experiences and tools with participants attending the Fundamentals of Social Accountability Course. progressive realization of human rights. plans (for key service delivery departments) has increased from around 20 pages in 1997 PSAM’s research reports/case studies involve to over 300 pages in 2008. Departmental and on-site visits to areas where services should be program operational plans have been made provided and some of these visits have allowed routinely available to the public after the for citizen participation and feedback on levels of PSAM litigated the Eastern Cape Department satisfaction with service delivery. of Health and successfully obtained copies of For example the Premier of the Eastern Cape its HIV/AIDS plans in 2003. Province had commissioned a household • Improved quality of annual �nancial reporting. survey (Rapid Assessment of Service Delivery There has been a dramatic decrease in and Socio-Economic Survey) in 2005 that was audit disclaimers14 issued to Eastern Cape undertaken by the Fort Hare Institute of Social government departments from 99 percent and Economic Research and was completed in of the Provincial budget in 1999 to 2 percent June 2006. The Premier refused to release the in 2006/07. The PSAM has consistently survey. The PSAM took the Premier to court using highlighted the issue of ineffective �nancial the Promotion of Access to Information Act and reporting and lack of compliance with secured the survey’s release in 2008 following a �nancial controls that have resulted in audit court order in favor of the PSAM. disclaimers since 2000. Impact • Improved disciplinary and integrity systems. Several examples illustrate PSAM’s impact: Continuous demands for access to departmental disciplinary databases led • Eastern Cape departmental strategic plans to the establishment of these databases have improved in quality and detail and in the key service delivery departments of have become more publicly accessible. The Education and Health in 2005. Ongoing average length of departmental strategic PSAM demands to publish declarations of 17 Audit disclaimers are usually an indication of a serious lack of �nancial control measures and lack of effective �nancial management. They do not indicate that the amounts that have not been properly accounted for have been misappropriated or stolen, however. 47 interest by members of the Eastern Cape archive/library was used by the Commission Executive and Legislature from 2000 led to access vital information that could not be to the establishment and publication of a provided by the administration to assist the declaration of interest register for the Eastern Commission with their investigations and Cape Provincial Government Executive and terms of reference. Legislature in 2004. • The PSAM has used the Promotion of • Training of National Assembly Access to Information Act regularly since parliamentarians on issues of integrity and its enactment. In 2008 the PSAM obtained accountability. two court orders against the provincial government with costs. The �rst case • Presentations have been made before involved ensuring public access to survey various Legislature Portfolio Committees information forming the basis for the needs over the past decade by researchers of the analyses underpinning government strategic PSAM. plans. The second case involved access to the performance agreements of heads of • Continuous advocacy by PSAM around government departments. The latter court external audit �ndings has served to case also enabled the PSAM to obtain strengthen the impact of the Auditor-General. information relating to housing subsidy fraud In December 2007 the national of�ce of the committed by public of�cials that revealed South African Auditor-General commended that little disciplinary action had been taken the work of the PSAM as follows: “I want against implicated of�cials. The information to thank you and your colleagues for all has since been circulated by the PSAM to your assistance and support this year. You enable departments to commence with the really played a meaningful role in helping us requisite corrective action. pro�le the work of this Of�ce and how it can improve, and continue to play a crucial role • The PSAM produced a research report in in safeguarding taxpayers’ public resources. 2005 entitled ‘Staff Shortages, Incapacity Thanks again, much, much appreciated�. and the Excessive Use of Consultants by the Eastern Cape Provincial Government’ which • In addition, the ability of the PSAM to assessed the extent of external contractors provide research and monitoring �ndings procured to undertake departmental across multiple �nancial years and to make functions. these �ndings available to parliamentary committees has strengthened the oversight • PSAM are regularly called upon by the media capacity of these committees. to comment upon alleged irregular tender awards made by government departments. • PSAM was asked by a Commission of Inquiry to make a submission on the key areas Media Coverage affecting service delivery within the Eastern Cape Provincial Administration. The PSAM PSAM maintains an up to date website and produced a 246-page submission that was issues press releases via a comprehensive supported by 5 staff giving oral evidence/ media mailing list. In December 2008 they testimony during late February and early had issued 12 press releases while they had March 2006. The submission was used by recorded 115 mentions in the electronic media Commission investigators and evidence (this excludes mentions in print media which they leaders to cross-examine public of�cials who do not access/archive (e.g. newspapers in other were subsequently called to testify. PSAM provinces etc) and other forms of media where a 48 subscription is required). In the same year they of Social Accountability’ which seeks to equip made 129 comments to the media, alongside 11 parliamentarians and staff of NGOs and CSOs television interviews and 34 radio interviews. In with the tools employed by the PSAM, so as to 2007 the PSAM issued 32 press releases and strengthen democracy in the Southern African were involved in 11 television interviews, 51 radio Development Community (SADC) region. interviews and gave 52 comments to the media. PSAM currently does not have the human resource They have also produced a number of opinion capacity to replicate in other provinces. They have pieces at the request of various media houses. therefore opted to share their monitoring and research tools with participants who attend the Constraints and Challenges in course and with partners in the �eld. Implementation Perhaps the most critical for sustainability of good The PSAM experiences similar challenges to governance is that the PSAM has developed those experienced by parliamentary oversight constructive engagements over time with certain committees in that many of its �ndings and government departments who recognize their role recommendations require responses and and are prepared to interact on issues of mutual corrective action to be implemented by importance. PSAM feels they have progressed senior leadership within government who steadily towards overcoming resistance, primarily have historically displayed an inability and/or because they adopt an evidence-based approach unwillingness to act decisively in the interests that draws heavily upon the Constitution. of good governance. Human resource and budgetary constraints also continue to affect Contact Details the implementation of government policies and programs. PSAM have also had relatively PSAM ineffective civil society engagement with issues PO Box 94 of underperformance within government. Rhodes University Grahamstown Eastern Cape Replicability and potential for South Africa 6140 scale Tel: 046 603 8358 The Training Program of the Centre for Social Fax: FAX. 046 622 7215 Accountability (CSA) (the PSAM is the other Email: psam-admin@ru.ac.za program of the CSA) offers a two week Rhodes Web site: www.psam.org.za. University accredited course on the ‘Fundamentals 49 Case Study 8: Procurement Reform in Philippines: The Role of Civil Society A particular characteristic of procurement reform in the Philippines has been the focus on civil society oversight. This case discusses the addressed the key problems. The Catholic Church proved to be a key ally. The role of the church became more visible during the implementation role of Procurement Watch, Incorporated (PWI), of the procurement law, but not so much in the a civil society organization created to monitor the advocacy and drafting of the law. PWI tried to implementation of the reforms. get support from the church at that time, but was not successful until the passage of the law and Background more clamor for governance was realized by the Catholic Bishop’s Conference of the Philippines Procurement Watch, Incorporated (PWI) was when they signed a covenant under the Coalition established in February, 2001 with the objective against Corruption. of �ghting corruption through public procurement oversight. The organization is independent of The media became part of a well-planned government, with diverse sources of funding, awareness campaign that was integral to the primarily outside the Philippines. Major donors project, comprising of i) targeted use of AM radio, are World Bank, USAID and AusAID. Civil society ii) invitations to “60 Minutes� type TV shows, iii) oversight of tender decisions is now a legal regular news releases in print media, and iv) an requirement, and PWI is seen as a legitimate advertising and promotions campaign including and valuable contributor to governance of streamers, posters, stickers, and free gifts. The procurement in the Philippines. focus of the campaign was to raise public awareness that there was a lot of leakage in funds from public The Estrada impeachment had given a useful procurement. A survey in 2000 revealed that about boost to civil society’s efforts to pass a law on 20% - 50% of public funds were lost to corruption. procurement reform as a way to curb corruption. Part of the problem was that there were a lot of But, post-Estrada, the hunger for reform abated laws, administrative/executive orders and policy and it was back to normal in both the lower house guidelines on public procurement that sometimes and the senate, so passing the procurement bill were conflicting that added to the confusion and would now be a much greater challenge. PWI dif�culty to implement good governance. The saw its immediate task as to generate the same campaign also focused not only in streamlining anticorruption fervor as during the impeachment, the procurement process through an omnibus to focus enough public attention on corruption law, but also increase transparency, accountability, again to convince legislators to support the economy, and ef�ciency in the process. needed legislation. PWI developed a two-pronged strategy for The New Law building public support: (i) vigorous engagement In January, 2003, nearly thirty months after various with key civil society groups and associations to versions of the bill were �rst submitted to Congress, gain their support; (ii) focus on print, radio, and President Arroyo signed the Consolidated TV media to raise the news pro�le of corruption Procurement Reform bill (HB 4809/SB 2248) in government procurement. into law as Republic Act (RA) No. 9184, “An Act The �rst tasks were demanding. While there Providing for the Modernization, Standardization were a number of credible anticorruption and and Regulation of the Procurement Activities of good governance NGOs, only the local chapter the Government and for Other Purposes.� RA of Transparency International had a good 9184 was published on January 11, 2003, in two understanding of the legal issues on government national newspapers, Malaya and the Manila procurement. PWI had to educate the others and Times, and in accordance with Section 78 of the convince them that the draft law was sound and bill, took effect 15 days later. 50 Defining the Strategy - A Possible Model multiplying and cascading effect of procurement cadres that were �elded in government agencies. Training In addition, The Of�ce of the Ombudsman Research REFORM established a ‘loose alliance’ and networking with Advocacy these groups to monitor and report on government bidding activities. This was �rst established by the Government Procurement Policy Board (GPPB) and PWI was the secretariat under the Asia Europe Meeting grant of the World Bank. Later, the Ombudsman under Simeon Marcelo took on a more active role in stimulating discussions and activating partnerships with the civil society By mid 2004, a number of well established organizations (CSO) network. civil society organizations had agreed to work The passage of the Government Procurement together to train and/or �eld observers for bids Reform Act (GPRA) laid the legal foundation and awards committees. This included, among for overhauling the entire public procurement others, PWI, the Catholic Bishops Conference of process in the Philippines. The procurement the Philippines (CBCP), the National Movement reform act applies to three procurement types for Free Elections (NAMFREL), the Philippines - infrastructure projects, goods, and consulting Contractors Association (PCA), and the services - and covers both national and local Transparency and Accountability Network (TAN). government. The Act also standardized, to the PWI served as the secretariat. Since PWI was extent possible, the procurement procedures that the only civil society organization (CSO) that was must be adopted by all government agencies and part of the Technical Working Group in drafting required issuance of procurement manuals and the procurement law, PWI had to take on the standard bidding documents. responsibility of training other CSOs on the law – Box 14: PWI Strategy in Planning a Reform Process: Key Steps for Effective Advocacy 1. Research and state the problem. 2. Develop goals and objectives. 3. Identify the target audience(s). 4. Identify stakeholders-other groups who are affected or could be affected through your campaign. 5. Formulate the advocacy message and identify the means needed to communicate it to the target audience. 6. Prepare a plan of action and schedule of activities. 7. Identify resource requirements: human, organizational, and �nancial. 8. Gather your allies-enlist support from other key players, other CSOs, the public, the government. 9. Identify monitoring and evaluation criteria and indicators. 10. Assess success or failure and determine next steps. 11. Identity possible conflict areas (even with allies). 12. Make use of legal and regulatory mechanisms to seek protection, compliance, and accountability. 13. Create channels for public participation. 51 The Act uses clear, simple “pass/fail� governments were unprepared to implement it. nondiscretionary criteria, which makes the This position allowed local government to not procurement process more corruption-resistant change their bidding procedures to conform and more ef�cient. The complexity and lack of to the new law and it’s implementing rules and transparency in the previous procurement system regulations. made it dif�cult for auditors to assess whether Despite resistance from local government, PWI agencies’ procurement practices complied uses the checklist tool extensively to train civil with the law. It also provides for criminal and society “observers� on the Bids and Awards administrative sanctions against procurement Committee (BAC). of�cials and bidders who violate the law, and empowers civil society monitors to �le reports of deviations from the mandated procurement Networking with Civil Society process with the government ombudsman.18 Initially, procurement was not the priority of many other civil society organizations, but PWI went Public Bidding Checklists about educating them and slowly they realized they were all working towards the common goal of It was determined that public bidding checklists good governance and that no single entity could would help provide the Bids and Awards achieve it on its own- it had to be a collective effort. Committees, including the observer, proper Every time PWI has an initiative or project, it calls guidance on performing its tasks. The checklist for a roundtable discussion to inform civil society details step-by-step procedures to be followed organizations and involve them. For example, in undertaking a procurement activity, following for the development of an anti-corruption the usual path from pre-procurement conference measurement methodology called the Differential to award of contract. The checklist user would Ef�ciency Expenditure Management (DEEM) simply note if the indicated steps were followed Tool study, they involved National Citizen’s or not by marking the appropriate box—yes or no. Movement for Free Elections (NAMFREL) To develop public bidding checklists, PWI hired because they were doing medicines watch/count. two Technical Support Of�cers for six months Instead of duplicating their efforts, PWI came to draft the public bidding checklist for the up with a methodology that complimented their procurement of goods, consulting services, and existing initiative. PWI’s philosophy is to build on infrastructure projects. The Technical Support existing initiatives and partnerships. In the case of Of�cers observed the proceedings of bid openings Collective Action for Good Governance (CAGG) for some government corporations’ projects. and Government Watch (GWatch), PWI partners They also utilized the draft Implementing Rules with them in training sessions because PWI does and Regulations to formulate the draft checklists, not have the expertise in the �eld they excel in – which were completed by September 2003. The they call upon those resources in order to ensure Government Procurement Policy Board approved the trainees get to see the bigger and better the public bidding checklists at the end of 2003. picture of advocacy and reforms. Functioning in this manner has helped PWI to forge more There was resistance from local government partnerships and linkages with other civil society to the Act – some felt they had not been organizations. suf�ciently consulted on its formulation and on the development of the Implementing Rules and Funding is entirely autonomous from government. Regulations. The League of Municipalities asked PWI implements its own projects and reports it to defer the Act’s enactment on grounds that local the way they see it. Government partners see 18 The Ombudsman’s mission includes the prevention, investigation, and prosecution of corrupt government of�cials. 52 it as a way to improve their system because it training programs for the volunteers to gain more comes from a third party or external scrutiny. con�dence in report writing. Departments of Health and Education see Observers feel threatened if they �nd adverse the collaboration with PWI as positive. PWI �ndings. To overcome this, PWI developed a believes that the enemy is corruption and not the feedback and complaints handling mechanism government. with the Ombudsman where they could �le Overcoming Challenges and complaints anonymously. Constraints The enormity of the task is a challenge in itself. Even with close to a thousand people PWI has One of the challenges is - how to bring down trained directly, there are a lot of procurement reforms to the community level to make more transactions that are left unmonitored. PWI impact felt at the ground level. Most of PWI’s work could not keep up with the demand due to other admittedly is at the national level, but they are priorities from their primary organizations. PWI beginning to work directly with the communities is more strategic now – dealing with one sector in a new project called Bantay Eskuwela (School at a time, before moving to the next government Based Procurement Watch). agency. Currently they are focusing on health Another challenge is to fund volunteers and and education sectors. trained civil society organizations that do not have budgets to cover transportation expenses to Looking Ahead monitor bidding activities in their locality. Luckily PWI is an active participant in multisectoral for PWI, they have operational funds to do so, but coalitions to �ght corruption. This is the niche it since the role of observers was institutionalized in has found—to provide technical assistance and the procurement law, it is a challenge as to how training to other organizations as they engage to operationalize its role without funds; this tends in this work. In general, the work of making the to dissuade them to even attend the biddings. procurement process more transparent seems To rectify this, PWI is bringing reforms to the to have been more successful at the national communities – the direct bene�ciaries so that the agency level than at the local level, in part expenses are minimized – perhaps a tricycle ride because the required national media attention is costing less than one USD becomes insigni�cant more readily focused on higher levels than on the compared to 10 USD per trip that partners pay to local government units. travel from Surigao to Butuan in Mindanao just to observe the bidding process of the Department of PWI staff has acquired the necessary expertise Public Works and Highways (DPWH) on the highly technical subject of government procurement and has combined it with effective Another immense challenge is the fact that public awareness campaigns involving other civil some of the trained observers do not see the society organizations and citizens. Their example value of reporting their �ndings. This is a huge demonstrates that civil society can be a valuable loss because to evaluate and monitor the ally to the supreme audit institution in its efforts to effectiveness of the reforms it is crucial to report force action on audit �ndings. �ndings. To overcome this, PWI has tried to open other ways and means for observers to report Some civil society organizations in the such as E-reporting, simpli�ed Diagnostic Report anticorruption coalitions have taken on the task Templates, Public Bidding Checklist toolkits etc. of monitoring the Bids and Awards Committees The challenge is to further simplify and popularize at the local government level. It is quite possible the tools for the common man – they have built they will achieve in the future what PWI wanted in a mentoring or shepherding component in their to achieve with the project as originally designed. 53 PWI’s most recent initiative is to develop a new tool Ports Authority in preparing terms of reference for to measure corruption and inef�ciency in public the bidding of its port security services. PWI also procurement, called Differential Expenditure develops research papers and press releases on Ef�ciency Measurement (DEEM) (Box 15). best practices in procurement procedures. A new partnership is being planned with the ombudsman Now widely recognized for its expertise, PWI to take advantage of a law that requires all college conducts a wide variety of activities with different graduates to participate in 3-4 weeks of mandatory groups including the ombudsman, government community service. The ombudsman supports a agencies involved in large procurements, and proposal that time spent by college graduates civil society organizations and citizens. The observing government bids and award decisions organization has developed close relationships will satisfy the that requirement and has asked PWI with the national ombudsman, in particular, to assist this initiative by training the trainers in the and even conducts training sessions on the ombudsman’s of�ce to implement this program. Procurement Act for of�cials in the Of�ce of the This initiative would expand the pool of potential Ombudsman. civil society bid observers and help educate the larger public on the importance of an ef�cient and As a partner of the ombudsman, PWI has also clean public procurement process –enhancing established the Feedback and Complaint-handling public accountability and civic consciousness. Mechanism to process and respond to reports and other information provided by procurement PWI’s sustainability derives from a strong observers. In many developing countries, partnership with reform minded government citizens prefer not to contact government of�cials agencies. PWI has been fortunate to get donor with complaints because they fear harassment funding that allows them to utilize tools that from corrupt of�cials and are more comfortable have been developed in the past in addition to dealing with nongovernmental organizations to the new tools that they could add to enhance address such issues. The presence of PWI as their initiatives. Their partners- the Department an intermediate organization that can serve as of Health and the Department of Education are citizens’ link to the ombudsman makes citizens sincere in implementing reforms. Some local more comfortable registering complaints about governments such as Naga city have come on irregularities they have observed. board and it has been observed that they have very ef�cient procurement processes. PWI has also developed partnerships with government agencies to observe and study There is more general awareness across the the systems in place for soliciting proposals country about reforms– more civil society and evaluating bids and awards. This includes organizations are involved in procurement diagnostic exercises on procurements managed monitoring. Corruption issues are openly by the Bids and Awards committee of the health picked up in the media and addressed in and defense agencies; and assisting the Philippine several forums (i.e. senate hearings, editorial Box 15: Differential Expenditure Ef�ciency Measurement DEEM seeks to determine the true (fair-market) cost of a publicly procured good or service and then compare that to what the purchasing agency paid. When the purchase cost is higher than the true cost, the difference can be attributed to corruption or inef�ciency. The amount serves as a precise and objective measure of the extent of the problem. The assumption behind the tool is that competitive bidding, done properly, should produce prices comparable to fair market prices. This means that procurement ef�ciency can be measured directly in monetary terms. 54 commentaries, even the taxi drivers and street Thornton, Nigel. 2006. “What Is Required to Deliver vendor conversations). The procurement law External Assistance through Country Systems? Procurement Reform in the Philippines.� Paper offers a stiff penalty – governments are careful presented at the 2006 Asian Regional Forum on about their procurement decisions because they Aid Effectiveness: Implementation, Monitoring, and know that they are accountable for their actions/ Evaluation, Manila, October 18–20. Asian Development decisions. Bidding timelines are shortened at the Bank (ADB), Manila. http://www.adb.org/Documents/ Department of Health. The community in general Events/2006/Aid-Effectiveness/country-papers/PHI- asks more intelligent questions about government Procurement.pdf. procurement i.e. people demand better quality of Toletino, Aurora. 2005. “Partnership for Transparency textbooks, roads, etc. Fund: Project Completion Assessment.� Procurement Watch, Inc., Manila. References Ramkumar, Vivek, and Warren Krafchik. “The Role Campos, J. Edgardo, and Jose Luis Syquia. 2005. of Civil Society Organizations in Auditing and Public “Managing the Politics of Reform: Overhauling the Legal Finance Management.� Center on Budget and Infrastructure of Public Procurement in the Philippines.� Policy Priorities, International Budget Project (IBP), Working Paper 70, World Bank, Washington, DC. Washington, DC. http://www.internationalbudget.org/ http://go.worldbank.org/H5HJ52B0Y0. SAIs.pdf. PWI (Procurement Watch, Inc.). 2003. “PWI Observes Bidding Activities of Its Partner-Agencies.� Updated in Contact Details 2003 at http://www.procurementwatch.org.ph/press_ Procurement Watch, Incorporated septpresent/aug_a.htm (accessed April 17, 2008). www.procurementwatch.org.ph ——— Web site: www.procurementwatch.org.ph/ index.htm. 55