Administrative Corruption: How Does E-Government Help?

1. Administrative Corruption: How Does E-GovernmentHelp? Subhash Bhatnagar sbhatnagar@worldbank.org Subhash@iimahd.ernet.in (Indian Institute of Management, Ahmedabad)

2. Presentation Structure • E-Government: Definition, scope, different perceptions and delivery models • Administrative corruption: some generic problems • Where does e-government help? • Success and failure-- reduced corruption; increased transparency; better service delivery, and higher revenues. • What are the critical success factors in implementing e-government?

3. E-Government: Scope and Definition E-Government is about a process of reform in the way Governments work, share information and deliver services to external and internal clients for the benefit of both government and the citizens and businesses that they serve. E-Government harnesses information technologies such as Wide Area Networks (WAN), Internet , World Wide Web, and mobile computing by government agencies to reach out to citizens, business, and other arms of the government to: Improve delivery of services to citizensImprove interface with business and industryEmpower citizens through access to knowledge and information andMake the working of the government more efficient and effectiveThe resulting benefits could be more transparency, greater convenience, less corruption, revenue growth, and cost reduction

4. Different Delivery Models • Departments going on-line • Greater departmental ownership: significant re-engineering possible • Citizen visit many departments, each one may be more efficient • Could be a first step in the absence of high band width network • Conveniently located Service Centers • Counters manned by public/private agencies • Multiple services at each location: payment, licenses, certificates • Can quickly move traffic from departments to service centers • Requires significant coordination • Self Service through a Portal one stop shop • Back end computerization and Integration needed for data sharing • High internet penetration; willingness and ability of citizen to use • Security and mutual trust (builds with successful outcome) • Usage builds up gradually. Adoption rate has to be driven. • Requires strong centralized leadership for extensive co-ordination

5. Consequences of Administrative Corruption • Largest cost is borne by the poor • Raises cost of doing business for SMEs by 20% • Irritant to investors, impedes FDI flows • Loss of revenue to Government • Disincentive to honest and efficient employees and citizens • Increases tolerance for corruption; society begins to value the wrong attributes • Petty corruption can be organized to collect funds for politicians • Petty corruption opportunities lead to bigger corruption in appointments and transfers.

6. Types of Corruption in Government to Citizen Contact • Administrative corruption • Service is denied unless bribe is paid • Service is delayed unless bribe is paid • Collusion (both parties gain at the expense of Government) • Favored allocation when mismatch between supply and demand • Lower valuation by Tax collection agencies • Waiving of penalties and fines • Tempering government records to provide unfair advantage • Extortion • Law enforcers, tax collectors make patently unreasonable demands to extort a bribe

7. Administrative Corruption: some generic problems • Complex rules-need for intermediaries • Discretion to delay or deny without assigning reasons- speed money • Incentive for collusion-both parties benefit at the expense of government/society • Decisions and actions are not traceable. citizens have no access to information • Lack of supervision in remote areas-problems of decentralization • Large power distance between civil servants and citizens-afraid to assert and complain • Poor mechanisms of complaint handling. Documentation is weak for any investigation • Weak investigation, slow judicial system-small chance of punishment • Mismatch in demand and supply—health and education

8. E-Government Applications with Some Impact on Corruption • BHOOMI, CARD, e-Seva, VOICE in AP in India • E-procurement:Mexico,Philippines,Bulgaria,Chile • Tax collection State Border Check Posts, Gujarat • Customs on-line: India, Philippines, Jamaica • OPEN, Seoul Municipality, VOICE in Vijayvada • CVC Web site in India, CRISTAL in Argentina • Gyandoot in India (Faltering)

9. Land Record Computerization Bhoomi, Karnataka, India • 20 million records of 6.7 million farmers spread over 9000 villages • Village Accountant responsible for issue of certificates and mutation • Certificate issue can take 3-30 days and a bribe of Rs 100-2000 • Mutation can take up to 2 years (30 days) • Encroachment of public land

10. Bhoomi: on-line delivery of certificates • 180 centers where operators issue certificates on-line in 15 minutes for a fee of Rs 15 (30cents) • Mutation request filed on line • Touch screen on pilot basis for easy access by citizens • Future plans to Web enable to provide access thru kiosks • Security thru bio-log in procedure • Incisive MIS reports for follow up on mutation

11. Report Card on Bhoomi is GOOD • Survey: 180 users from 12 kiosks and 60 non users 4 taluks • Ease of Use: 78% of users who had used both systems found Bhoomi simpler; 66% used Bhoomi without help vs. 28% in manual • Complexity of Procedures: 80% did not have to meet any one other than at kiosk: In manual 19% met one officer and 61% met 2-4 officials • Errors in documents: Bhoomi 8% vs manual 64% • Rectification of errors: sought correction 93 % vs 49%, timely response 50% vs 4% • Cost of service: 84% one visit to Bhoomi center at Taluk HQ • Corruption: 66% paid bribes very often vs 3% in Bhoomi • Staff behavior: Bhoomi Good (84%) vs manual Average (63%)

12. Interstate Check posts in Gujarat • Project completed in 9 months at a total cost of Rs 630 million (70% on civil work). Yearly expenses: Rs 20 mln • Proportion of trucks checked increased from 2% to 100% , revenue up in 2 years- Rs 930 to Rs. 2370 million. Growth in mln Rs 310(98),560(99),930(00),1660(01),2370(02) • Corruption due to collusion. Not just administrative • Penalty reduced from Rs 2000 per Ton to Rs 250 • Survey of 142 drivers at 3 check posts • Following components do not work • conversion of video image of registration plate • creation of a data base on all trucks • monitoring of images at a central point

14. Report Card: Gujarat Check post • Waiting times have reduced by 30 mts from 105 minutes Except weighing no improvement perceived in cash collection, document checking. • No impact on transparency-weight not displayed nor printed on receipt. • Corruption continues: Rs 20-50 charged from every driver • 33% overloaded trucks let go with no fines. Bribes average Rs 120 and are 10% of fines • 77% report no change in overloading • Most components not working. Revenue at increased levels but growth not likely. If corruption is plugged revenue can be increased by 60%.

15. Gujarat Check post: Reasons for Poor Sustainability • Cost-Benefit --Whose point of view? • Focus on revenue increase and not on benefits to truckers, society, employees, transporters • Changes in political (chief minister, minister transport) and administrative leadership (4 commissioners in 2yrs) • Lack of motivation to continue work of predecessor • Quick implementation: partial automation, not fully owned by department, use of untested technologies • Lack of comfort in contracting with private sector • Technology as the only tool for reform. No other reform.

16. Egovernment-How does it help • Introduces transparency in data, decisions/actions, rules, procedures and performance of Govt. agencies • Automates processes to take away discretion • Entry point for simplification of rules and reengineering processes • Makes decisions traceable- tracks actions • Builds accountability- greater access to information through web publishing-role of civil society • Provides documentation to citizens for follow up

17. Egovernment-How does it help • Introduces competition amongst delivery channels and departments • Standardized documentation of comments/ objections leads to effective supervision- through comparative indicators • Centralizes data for better audit and analysis Integration of data across applications-provides improved intelligence • Enables unbiased sampling for audit purposes

18. Type of Information being made transparent Resulting benefits Rules and procedure governing services; public officials responsible for different tasks; citizen’s charter; Enhancing citizen’s exposure Standardizes procedures for delivery of service. Reduces arbitrariness, e.g. demand for additional documents Information about decisions and actions of government functionaries: outcome and process e.g. award of contracts and license, allocation of resources. Exposure of corruption and improved accountability Data about individual entities in Government records such as land records, comments on application for license, bill of entry for goods, status of tax payments. Exposure of manipulation for exchange of bribe and corruption Information on performance of economy: Statistical employment, income, trade etc. Performance indicator for Government departments Civic engagement in governance Greater accountability Names of citizens with large outstanding loans, taxes; civil servants under investigation or convicted, index of corruption, performance of investigating agencies. A kind of punishment for the corrupt through public exposure Disclosure of assets, income, profile of election candidates, elected representatives, ministers and civil servants Creates disincentive for corruption by creating fear of exposure

19. Critical Success Factors • Strong Political and Administrative Leadership , detailed Project Management • Clearly identified goals and benefits • Significant Process Reengineering Required • Start Small, scale up through stages, manage expectations • Adopt established standards and protocols – minimize customization • In-source Analysis ; Outsource design, software development, data preparation, training, etc. • Training Expenses should not be minimized

20. Enablers of e-Government • 20 % Technology • 35 % Business Process Reengineering • 40 % Change Management • 5% Luck ! Technology Process People

21. Sustainability Risk Factors • Implementation and use should sustain over long periods and measurable benefits delivered to all stakeholders-need for evaluation • Frequent changes in administrative leadership. Short tenure of implementers: hurried implementation and/or lack of resources • Inappropriate definition of project scale and scope. • Egovernment not implemented in a context of wider change/ administrative reform. In the face of high political corruption can the civil service be denied the opportunity? • Close identification of a project with a single champion • Change affected by by-passing employees • Partial automation(back-end not computerized) and automation without reengineering. • Use of untested fancy technology. • Egovernment can offer new opportunities for fraud and corruption

23. Organization for Implementing E-government • A champion at the political level • Ministerial level co-ordination committees • A central support group • Departmental Champions and co-ordination committee • Institution for Training • Private sector partners

24. Summary: egovernment is not irreversible magic • E-Government can advance the agenda on Governance reform, transparency, anti- corruption, empowerment. It is NOT a panacea • Potential is recognized but Implementation is difficult. Gains are real but risks need to be understood. Challenge is to promote wide spread use in areas where benefits outweigh risks. • Situate in a broader framework of anticorruption. Identify all pressure points and reengineer to remove discretion, simplify procedures and put out as much information in public domain. Incentive structure and institutional capacity • Create competition in delivery channels • Strengthen physical supervision and actionable MIS • Build other forms of benefits for those who loose power and income • Co-opt civil society to build accountability