tepav
türkiye ekonomi politikaları araştırma vakfı
Need for RIA and Public
Consultation in Turkey
Sibel Güven, Ph. D.
Istanbul - November 20, 2007
Need for RIA and Public Consultation in Turkey
Agenda
 The Need for RIA in Turkey
 The ‘Transformation Process’ in Turkey
 ‘Second Generation Reform’ agenda
 ‘RIA’ as a ‘Better Regulation’ tool
 The importance of ‘Consultation’
 RIA & Consultation experiences in EU
 RIA experience of TEPAV
 Lessons learned and Recommendations
Slide 2
Need for RIA and Public Consultation in Turkey
Slide 3
A new era for Turkey
 Two very general questions…
 Why is today different from yesterday?
 And how can tomorrow be different from today?
 Reform agenda
 Macroeconomic reforms are under way
 However, there are ‘winners’ and ‘loosers’ of the reform
process
 The new role of state: regulatory state
 The need for second generation reforms
 EU accession process
Need for RIA and Public Consultation in Turkey
Slide 4
Drastic change in Turkey’s economic
environment since 2001
Industrial production, interest rates and inflation in Turkey, 1999-2006
250
200
Industrial
production
150
100
50
Benchmark bond's
interest rate
Inflation
0
Apr-98
Aug-99
Jan-01
May-02
Oct-03
Feb-05
Jul-06
Nov-07
Source: Central Bank of Turkey
Need for RIA and Public Consultation in Turkey
Slide 5
Rapid integration into the global economy
Turkey’s total trade volume (in billion USD) and trade/GDP ratio: 2000-2006
250
58%
Trade Volume (in billion USD)
56%
Trade / GDP (right axis)
200
54%
52%
150
50%
48%
100
46%
44%
50
42%
0
40%
2000
2001
2002
2003
2004
2005
2006
Source: Undersecretariat of Foreign Trade
Need for RIA and Public Consultation in Turkey
Slide 6
Turkish economy becomes increasingly
diversified in the region
in terms of markets..
Number of export destinations with a volume over 1 billion USD
16
15
14
2000
2005
12
10
8
7
6
5
5
7
5
4
4
3
2
2
1
1
2
2
2
1
y
rk
e
Tu
R
om
an
i
a
ae
l
Is
r
in
e
kr
a
U
en
ia
Sl
ov
n
Ir a
ec
e
G
re
B
ul
g
ar
ia
ia
ni
s
Tu
an
O
m
co
M
or
oc
ro
at
ia
C
m
en
Ye
n
rd
a
Jo
A
ze
rb
ai
ja
n
0
Source:COMTRADE, TEPAV’s calculations
Need for RIA and Public Consultation in Turkey
Slide 7
Turkish economy becomes increasingly
diversified in the region
in terms of products..
Number of export items with a volume over 1 billion USD
(SITCrev2 classification in 2 digits)
20
2000
2005
16
15
10
10
7
5
5
4
3
3
3
5
5
4
3
2
1
1
1
y
rk
e
Tu
ae
l
Is
r
a
R
om
an
i
in
e
kr
a
U
en
ia
Sl
ov
ec
e
G
re
A
ra
bi
a
n
ud
i
ia
ni
s
Tu
an
O
m
co
M
or
oc
B
ul
g
ar
ia
n
ah
ra
i
B
m
en
Ye
n
rd
a
Jo
Ir a
Sa
A
ze
rb
ai
ja
n
0
Source:COMTRADE, TEPAV’s calculations
Need for RIA and Public Consultation in Turkey
Slide 8
Turkey’s global storyline:
- An investment hub, with access to markets of 1 billion people.
- Two centers of growth: the strongest private sector and
institutional infrastructure between EU and China
Need for RIA and Public Consultation in Turkey
Second Generation Reform Agenda
 Current reform agenda is more complex.
 Contentious issues untouched before 2007 (judiciary,
education, health, social security)
 Need for consensus building
 New constitution
Reform areas
First generation reforms
Second generation reforms
 Drastic budget cuts and tax reform
 Price liberalization (inl. Exchange
rate
 Trade and foreign investment
liberalization
 Private sector deregulation
 Privatization
 Labor market reform
 Public administration reform
 Decentralization
 Judicial reform
 Upgrade regulatory capacities
 Sectoral restructuring
 Education reform
 Health reform
 Social security reform
Slide 9
Need for RIA and Public Consultation in Turkey
The need for RIA
 We need RIA as an important ‘better
regulation’ tool
 Second generation reforms
 Harmonization of EU acquis
 Turkey can not afford another lost decade
as in 90’s
Slide 10
Need for RIA and Public Consultation in Turkey
Slide 11
The RIA Process
Stage 1: Identify the problem
Is regulation the appropriate response?
YES
Regulation
avoided
Are all those likely to be affected
included in the consultation?
Stage 2: Consultation
YES
Stage 3: Preparation of the
legislation
Stage 4: Re-evaluation of the
regulation legislation during
Parliamentary passage
NO
Regulation abandoned
or legislation redrafted
Does the legislation still meet the
objectives as originally intended?
YES
Stage 5: Monitoring existing
regulation
NO
Regulation abandoned or
consultation
exercise repeated
Does the legislation reflect the
evaluation undertaken and does it
adequately address the problem?
YES
NO
Regulation
abandoned or
legislation redrafted
Is the regulation still achieving its intended
benefits and without unanticipated costs?
Regulation remains
appropriate – but still
re-assess periodically
Source: Kirkpatrick, 2007
NO
YES
NO
Abolish the
regulation or
amend it
Need for RIA and Public Consultation in Turkey
Slide 12
A closer look at consultation (1)
 Regulation has many stakeholders:
 Households, investors, government, CSOs
 Each has its own set of objectives/demands, and each one
may be affected differently
 How do we decide between them?
Need for RIA and Public Consultation in Turkey
A closer look at consultation (2)
 The need for consultation
 State as the balancing actor
• Transparency
• Accountability
• Consistency
 Maximizing social welfare
 Consultation as a compliance tool
Source: Kirkpatrick, 2007
Slide 13
Need for RIA and Public Consultation in Turkey
A closer look at consultation (3)
 Dangers of regulation:
 Regulatory capture
 Political capture
 How do regulators retain ‘independence’?
 To what extent should regulators be ‘independent’?
 What about regulatory accountability?
 Accountable to whom?
• Parliament, Minister, Competition Authority, Other?
Source: Kirkpatrick, 2007
Slide 14
Need for RIA and Public Consultation in Turkey
Consultation Mechanisms (1)
 Basic questions
 Why consult?
• Learning
• Collective Learning
• Advocacy - Compliance
 What do we want to talk about?
• Values and principles
• Problem justification
 Who do we want to talk with?
• Engage with people who have information
– Evidence
– Enriched understanding
 When should we talk?
• An ongoing process for different purposes (learning vs. advocacy)
 How should we communicate?
• Multiple ways might be employed simultaneously
Source: Milligan, 2003
Slide 15
Need for RIA and Public Consultation in Turkey
Slide 16
Consultation Mechanisms (2)
1.
Adopt RIA at the highest political levels – build commitment
2.
Establish explicit standards for assessing regulatory quality and
regulatory decision making.
3.
Develop ownership of the RIA method at the departmental level.
4.
Establish procedures to ensure RIA is built into the process of
regulatory appraisal. RIA must not be seen as either a “burden” or
irrelevant “add on”.
5.
Establish procedures for systematic public consultation.
6.
Establish methods for prioritizing where detailed RIAs should be
applied.
Source: Kirkpatrick, 2007
Need for RIA and Public Consultation in Turkey
Slide 17
Consultation criteria in UK
1.
Timing of consultation should be built into the planning process
2.
It should be clear who is being consulted, about what questions, in what timescale and
for what purpose.
3.
A consultation document should be as simple and concise as possible.

It should include a summary, in two pages at most, of the main questions it seeks views on.

It should make it as easy as possible for readers to respond, make contact or complain.
4.
Documents should be made widely available, with the fullest use of electronic means,
and effectively drawn to the attention of all interested groups and individuals.
5.
Sufficient time should be allowed for considered responses from all groups with an
interest.

6.
Responses should be carefully and open-mindedly analyzed

7.
Twelve weeks should be the standard minimum period for a consultation.
The results made widely available, with an account of the views expressed, and reasons for
decisions finally taken.
Departments should monitor and evaluate consultations

designating a consultation co-ordinator who will ensure the lessons are disseminated.
Source: OECD, 2002
Need for RIA and Public Consultation in Turkey
Slide 18
Consultation procedures in EU (1)
 Aim
 ensuring transparency
 enhancing workability and legitimacy for
all
 Consultation plan
 ongoing consultation throughout all
analytical steps of RIA
 the objective of the consultation
 relevant target groups
 appropriate consultation tool
 consultation time
 consultation document
Analytical Steps of RIA
1.
Identify the problem
2.
Define the objectives
3.
Develop main policy
options
4.
Analyze their impacts
5.
Compare the options
6.
Outline policy
monitoring and
evaluation
Source: EC, 2005
Need for RIA and Public Consultation in Turkey
Slide 19
Consultation procedures in EU (2)
 Consultation tools
 consultative committees
 expert groups
 open hearings
 ad hoc meetings
 consultation via Internet
 questionnaires
 focus groups
 seminars/workshops
 Interactive Policy Making (IPM)
Source: EC, 2005
Need for RIA and Public Consultation in Turkey
Slide 20
Appropriate public consultation tool
 Structured, close ended consultation might be over
simplistic
 On the other hand, consultation fatigue should be
avoided
 Intensive consultation for prioritized RIAs, whereas
simpler techniques for others
 Thus, an independent auditory body is needed for
prioritization
Need for RIA and Public Consultation in Turkey
Slide 21
TEPAV’s interest on RIA (1)
 The Economic Policy Research Foundation of
Turkey (TEPAV) is an
independent,
non-governmental and
non-partisan think-tank, established in October 2004
 TEPAV intends to
increase the knowledge content of policy discussions in
Turkey
remove the gap between academic research and policy
implementation.
Need for RIA and Public Consultation in Turkey
Slide 22
TEPAV’s RIA experience (1)
 Thus, TEPAV also have common objectives with
RIA
Capacity building for RIA and Better Regulation
Enhancing coordination and consultation between the
stakeholder organizations
 Studies conducted by TEPAV on RIA
 TEPAV | MOD Computable General Equilibrium (CGE)
Model Studies
 EU funded project on impact assessment
• Strengthening the capacity of impact analysis,
• awareness raising and a micro implementation on environment
in the EU accession process
Need for RIA and Public Consultation in Turkey
Slide 23
TEPAV’s RIA experience (2)
 Objectives
 Raising awareness on impact assessment among the decision-
makers in public and civil society organizations
 Educating officials from the corresponding organizations
 Strengthening impact assessment capacity through a micro model
application
 Micro model
 Impact assessment on the harmonization of LCP Directive
(2001/80/EC) in lignite-fired power plants in Turkey
 Pioneering the consultation process among the stakeholder
organizations
Need for RIA and Public Consultation in Turkey
Problem definition (1)
Fiscal discipline
Privatization
Treasury,
MoFinance, SPO
Limit investment
Security of supply
EU acquis
Import Dependence
Better Quality of Life
MoEnergy
MoEnvironment
Produce energy
Limit emissions
EÜAŞ
Slide 24
Need for RIA and Public Consultation in Turkey
Problem definition (2)
Slide 25
Need for RIA and Public Consultation in Turkey
Slide 26
Problem definition (3)
 Not a simple problem
 Needs a comprehensive
consultation process
 Stakeholders
 Chamber of Environment
Engineers
 Chamber of Electrical Engineers
 Electricity Generation Co. Inc.
 Energy Market Regulatory
Authority
 Ministry of Agriculture
 Ministry of Health
 Ministry of Industry and Trade
Ministry of Industry and Trade
Ministry of Energy and Natural Resources
Ministry of Environment and Forestry
State Planning Organization
Turkish Coal Enterprise
Turkish Treasury
Union of Chambers and Commodity
Exchanges of Turkey
 Union of Turkish Doctors
 United Nations Development Programme







Need for RIA and Public Consultation in Turkey
Consultation: Design
 Conflict of interest
 Allocation of scarce resources
 Insufficient communication & consultation
among the stakeholders
 Two important bodies
 Steering Commitee
 Working Group
Slide 27
Need for RIA and Public Consultation in Turkey
Slide 28
Consultation: Steering Committee
 Shared reasoning instead of conflict of
interests…
 Steering committe,
Enhancing the institutional commitment for
cooperation and share of data
Monitoring the studies of the working group
Controlling and approving the outputs of the
project
Need for RIA and Public Consultation in Turkey
Slide 29
Consultation: Working Group
 They are intended to be the pioneers of
impact assessment in their organizations
 Working group;
 Trained on RIA at the beginning of the project
 Will be the agents of the cooperation
 Sharing institutional data, expertise and
knowledge
Need for RIA and Public Consultation in Turkey
Slide 30
RIA: A threat or an opportunity?
RIA as an opportunity





better regulation is essential for competitiveness
more informed policy-making is necessary to avoid potentially
adverse social and environmental impacts of rapid change
smoother passage of laws through cabinet and parliament
a catalyst for reform and strengthening of the entire administrative
structure
develops individuals as effective policy-makers
RIA as a threat




increased workload
changes of responsibility
need for new skills
transparency of decision-making
Source: Kirkpatrick, 2007
Need for RIA and Public Consultation in Turkey
Slide 31
Lessons learned
1. The problems start from the ‘problem definition’ stage
2. Government organizations are reluctant for data and information
sharing, even within their governmental institutions
3. Technical skills for RIA implementation is very poor
4. RIA seen as either a ‘burden’ or irrelevant ‘add on’
5. The scope of compulsory RIA must be broadened including all costly
legislations and secondary regulation
 LCPD Directive
Need for RIA and Public Consultation in Turkey
Recommendations for Turkey
The idea of ‘shared reasoning’ instead of ‘conflict of interests’ has to become widespread
1.

Political commitment

Bureaucratic support

Technocrat capacity

Data availability and transparency
Cultural change
within government
Coordinator RIA Body
2.

Prioritization and process determination

Quality assurance, transparency check

Technocrat capacity
Public administration
reform
RIA awareness within CSOs
3.

Regulation monitoring

RIA skills
Active role in
decision making
Slide 32
Need for RIA and Public Consultation in Turkey
Türkiye Ekonomi Politikaları Araştırma Vakfı
Söğütözü Cad. No:43
TOBB-ETÜ Yerleşkesi TEPAV Binası
06560 Söğütözü – Ankara
Tel: 312 – 292 5500
Fax: 312 – 292 5555
www.tepav.org.tr
Dr. Sibel Güven -
sibel.guven@tepav.org.tr
Slide 33