MANAGING SUCCESSFUL GOVERNANCE REFORMS:
LESSONS OF DESIGN AND IMPLEMENTATION
SYNTHESIS AND DESK REVIEW
Mark Robinson
Executive Summary
Overview and purpose
This paper presents the findings of three country case studies of successful
governance reforms in Brazil, India and Uganda and a desk review of public sector
governance projects supported by the World Bank from the late 1990s. In focusing
on the political and institutional factors that contribute to successful outcomes, the
paper highlights the feasibility of various approaches to improving public sector
governance in different country and regime contexts.
The case studies examine four areas of governance reforms: public financial
management (fiscal management and tax administration), anti-corruption, civil service
reform, and innovations in service delivery. The synthesis builds on country specific
observations about the conditions for successful reform as a basis for framing
generalisations on the factors that influence reform outcomes, rooted in comparisons
of political dynamics and institutional factors. The desk review was informed by a
range of reports and documents produced by the Bank from ten countries in Africa,
Asia and Latin America with a view to generating lessons and insights from
diagnostic work and lending activities.
The third part of the paper considers the implications of the research for analytical
work and Bank lending operations. It seeks to complement economic and sector work
in the Bank by highlighting the political and institutional factors that shape successful
reform outcomes in different reform contexts. This can deepen understanding of the
risks and feasibility of different types of governance reform and how their design and
implementation might be improved.
Case study findings
The case studies demonstrate that the successful implementation of governance
reforms is conditioned by three sets of factors: variations in the type of reform,
variations in the form of regime, and variations in technical capacity. These
distinctions give rise to diverse reform trajectories, characterised by different
combinations of political, institutional and technical factors.
The case studies indicate that some categories of governance reform are easier to
achieve than others. Incremental reforms that are carefully selected to minimise
opposition and produce modest benefits in their initial stages have a greater chance of
success and sustainability than large-scale reforms that are implemented quickly.
These include innovations in service delivery, and measures designed to improve civil
service accountability and incentives. These do not entail zero-sum games in that
modest benefits resulting from improved delivery of services can generate popular
support and embolden reformers, as a means of offsetting opposition from bureaucrats
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and politicians who stand to lose power and influence. Bureaucrats also benefit from
positive reactions from citizens who receive better services, elevating their status and
job satisfaction, thereby creating positive incentives for reform.
Reforms that require structural changes in fiscal management, tax administration, and
the organisation of the civil service are more difficult to accomplish. Political
commitment and material incentives to buy off potential opposition are important
contributory factors but sustainability is hard to achieve in the absence of visible
results that secure wider political support and societal assent. Reforms that entail
wholesale institutional change can be accomplished in two ways: through a gradual,
cumulative set of reforms that produce a new pact between interested actors, or the
absence of a direct threat to societal interests who can block or derail reform
initiatives.
The nature of the regime is a major determinant of the political feasibility of reform.
Political commitment is a significant factor in initiating and sustaining governance
reforms irrespective of the form of regime. Visible commitment from the political
leadership provides support to officials responsible for implementation and guards
against opposition from those who stand to lose from the reforms. Democratic
regimes with elected governments tend towards incremental approaches in order to
minimise potential opposition to reform. The decision to embark on reform is
motivated by a shrewd calculus governed by an assessment of the potential political
costs and benefits. Initial reforms may be modest but there is recognition that the
cumulative effect of small changes may generate political dividends from improved
outcomes. Non-democratic political contexts enable governments to introduce more
challenging reforms as they are able to distribute the costs of reform in a manner
designed to minimise opposition. However, a lack of accountability combined with
the imperative of maintaining political power in such regimes can subvert the longer
term sustainability of governance reforms.
The technical capacity of bureaucratic elites is a significant determinant of the success
of the design and implementation of successful reforms. A high degree of technical
capacity is common to successful reformers. Such capacity may be concentrated in
particular ministries and agencies and may take time to cultivate and develop.
Technical assistance from aid donors plays a key role where such capacity is initially
weak and in short supply. The infusion of new types of technical skills into
organisations dominated by traditional civil servants or sector specialists can foster
experimentation with new approaches. Insulation of policy makers and technocrats
from societal and political pressure at the inception stage provides a durable basis for
institutional design, but the exclusion of organised interests during implementation is
not conducive to accountability, effectiveness and sustainability. Excessive insulation
limits scope for independent oversight and creates opportunities for rent seeking and
patronage. Initial insulation followed by gradual opening up of the policy process
during the course of implementation appears to be more conducive to successful
outcomes.
Lessons from the World Bank’s experience
Governance reform lies at the heart of the Bank’s overall strategy, premised on the
recognition that an accountable and efficient public sector are conducive to positive
growth and poverty reduction outcomes. Governance and institutional issues
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routinely feature in country assistance strategies, informed by economic and sector
work. Design weaknesses and the failure to anticipate political and institutional
challenges were the principal determinants of the poor performance of civil service
reform programs in the 1980s and early 1990s. The performance of Bank lending
operations for public sector governance has improved markedly since the late 1990s,
with growing recognition of the importance of political incentives for reform, the
mobilisation of constituencies for reform, and the need to adapt institutional design to
local conditions.
There is greater appreciation of political and institutional factors in shaping the
context of Bank operations and implementation of public sector governance programs
at the level of country strategy and in lending operations. The insights of economic
and sector work are often reflected in country strategy documents, especially in Latin
America, where institutional and governance reviews have informed the design of
lending operations. There is some reference in project documentation to the influence
of political and institutional factors in determining the feasibility of reform and in
shaping reform implementation. The political risk of different trajectories of reform
also receives attention in country strategies, with implications for feasibility and pace
of implementation. In this respect the recognition that civil service reform may not be
politically feasible in many African and Latin American countries is indicative of
greater appreciation of the limited incentives for reform. The importance of the time
factor is also acknowledged, with the recognition that quick results within a single
term of an elected government cannot be expected. The value of an incremental
approach is reflected in longer time frames for implementation to allow for the
development of a politically feasible sequence of reform initiatives.
Country assistance strategies demonstrate growing awareness of the importance of
political and bureaucratic commitment in ensuring positive outcomes and the
sustainability of reform initiatives. High-level political commitment was undoubtedly
a key factor in the successful implementation and sustainability of civil service
reform, the formation of semi-autonomous tax authorities, and public expenditure
management reforms. The absence of political commitment or prevarication was a
contributory factor in the failure to realise reform objectives. There is evident
recognition of the need to build incentives in Bank lending programmes to strengthen
political commitment and provide leverage for those responsible for reform
implementation.
Deliberation of proposals for governance reforms within the political executive and
the creation of special commissions to oversee implementation was an effective
means of deepening support and avoiding excessive dependence on reform
champions. However, there is little evidence of wider civil society participation in
framing debates and policy options for structural reforms in the public service or tax
administration. Such involvement was generally limited to decentralisation and
service delivery initiatives that were not the main focus for this review. Anticorruption initiatives were largely focused on legislative and institutional reforms to
promote increased accountability but with modest levels of civil society participation.
Another theme that comes through strongly in Bank project documentation is the
importance of technical capacity for implementing public sector reform programs.
While the technocratic bias of civil service reform programs adopted by the Bank in
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Africa in the 1980s and early 1990s is less evident, the existence of capable technical
elites within government bureaucracies is recognised to be an essential requirement
for designing and managing successful reform as well as an intended outcome of
reform exercises. The challenge of strengthening state capacity is recognised in many
country programs and specific lending instruments are increasingly deployed to offer
policy advice and technical support as a means of addressing capacity constraints.
Implications for analysis and operations
The findings of the case studies and review of Bank public sector governance projects
have implications for economic and sector work and lending operations. The limited
availability of comparative data on the impact of the Bank’s governance operations
points to the need for more systematic evaluation of country level and sectoral
experience. This would enhance internal knowledge of the Bank’s contribution in this
area and demonstrate the progress that has been achieved to a wider constituency
outside the Bank. Further case studies of successful governance reform in
comparable thematic areas (such as public expenditure management and anticorruption) and would help to corroborate and provide greater consistency for the
findings of this research, especially in poorer states with severe capacity constraints
that are not consolidated democracies. Political feasibility analysis for public sector
reform programs would emphasise risks and opportunities of country level reform
strategies, taking into account the political characteristics of reform in specific regime
contexts. Stronger skills in political and institutional analysis in country offices
would be supportive of this approach.
The Bank’s revised approach to development policy lending has several implications
for public sector governance operations. Experience suggests that explicit attention to
the political feasibility of reform, the need to build incentives for reform, and working
with reform-minded politicians and bureaucrats would appear to be a fruitful
approach. Widespread consultation on governance reform is a risky strategy that can
provoke early opposition. Gradual opening up to wider involvement and creating
channels for citizen feedback can strengthen domestic constituencies for reform.
Longer-term time horizons and an incremental approach are conducive to successful
implementation and sustained reform. The risk that governance reform may be
downplayed as a policy objective in poverty reduction strategies highlights the need
for continued investment in lending operations that strengthen technical capacity and
ensure consistent focus on public sector governance issues.
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