Chapter

7 Better Public Sector Resource Management: Capacity Building and Good Governance

Editor(s):
Laura Wallace
Published Date:
January 1999
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Author(s)
Emmanuel Tumusiime Mutebile

Governments in Africa have embarked on a comprehensive program supported by the World Bank called Partnership for Capacity Building in Africa. Launched in October 1996, it is aimed at helping African countries undertake national capacity assessments, formulate national capacity building strategies, establish a trust fund for capacity building in Africa, and ensure that the World Bank and other development partners incorporate capacity building into their operational practices and procedures.

What is capacity building? Capacity building is a broad concept encompassing any activity whose output is the increased ability to carry out specified functions more effectively. Capacity building includes training and the development of human resources, as well as improvements in systems and institutional structures.

Uganda’s Capacity Building Plan

In Uganda, a systematic approach to capacity building was developed long before the African capacity building partnership was created. A strategy and program of action were developed between 1991 and 1993 through consultations with all the major stakeholders, including government ministries, institutions of higher learning, technical education institutes, private sector organizations—such as the Uganda Manufacturers Association and the Uganda Bankers Association—accountants, members of the various consulting professions, and the donor community. These consultations culminated in Uganda’s Capacity Building Plan, which was published in 1994.

The objective of the plan was to build Ugandan ownership of the capacity building process, to identify the areas that needed priority attention, to develop an overall institutional framework to implement the plan, and to guide donors in their financial and technical assistance contributions. The plan recognized that Uganda’s long-term development depended on the capacity to initiate and manage change, accumulate human capital, adopt modern ways of doing things, and adapt to constant change. The plan also identified the following priority areas where capacity building was required:

  • economic policy formulation and policy analysis;

  • legal and judicial system reform;

  • women in development;

  • accounting and consulting professions;

  • technical and vocational training;

  • nongovernmental organizations as capacity builders; and

  • encouragement of the repatriation of skilled Ugandan expatriates.

For each of these areas, the plan highlighted the key policy changes required; any changes needed in the existing institutional framework, including the creation of new institutions; and proposals for a program of action.

What are the basic precepts? First, the plan recognizes that sound economic management is an essential prerequisite for the successful development of all sectors of the economy. This means strengthening the government’s capacity for policy formulation, harmonizing sectoral policies and those of line ministries with the macroeconomic policy framework, and strengthening the institutional framework for policy development and policy coordination. But there are some problems. The inadequate database undercuts the ability to make routine economic, fiscal, and monetary projections. In addition, the key agencies involved in planning and policy formulation face severe shortages of trained experts and technicians. Substantial improvements were made following the merger of the ministry of finance and the ministry of planning and economic development, but further improvements are constrained by the weak databases, skills shortage, and institutional weakness.

Second, the plan recognizes that there is a need to strengthen the capacity for policy analysis outside the government through creating a capacity for independent research in the private sector and nongovernmental organizations. As the private sector is the engine of growth in Uganda, it must be involved in the dialogue on governmental policies that affect it. To this end, the government has made significant financial contributions to enhance private sector capacity building through United States Agency for International Development grants to the Uganda Manufactures Association Consultancy and Information Services. It has also created the Economic Policy Research Center at Makerere University, but at arm’s length from both the government and the university. Besides engaging in independent research, the center will have a young professionals program, in which select students from the master’s program in economic policy and planning at Makerere University will train for doctoral degrees in association with universities overseas.

Third, the plan recognizes that civil service reform—creating a lean and professional civil service—is critical for capacity building. This means remunerating civil servants adequately and monetizing all noncash benefits and allowances to improve the transparency and equity of the remuneration structure. Moreover, higher civil service pay must be coupled with adequate training, retooling, provision of modern technology, and upgrading of office facilities and premises. Local experts from the nongovernmental sector should be hired on contract to bring new people into the ministries and expose civil servants to new ideas and new work ethics. And promotions should be based on performance. The hope is that improved salaries and more transparency and discipline will also reduce the temptation for civil servants to engage in corrupt practices.

Of course, civil service regulations and procedures will need to be revised to bring them in line with the new management style. This will include introducing clearer job evaluations and grading criteria; better records and personnel management systems; a focus on service delivery, with clear predetermined objectives and prespecified time frames; high standards of accounting, auditing, and financial management; and effective sanctions for nonobservance of the code of conduct for civil servants or for other misdemeanors.

Since the publication of the capacity building plan, the government has carried out several initiatives under various donor-funded projects. These projects have assisted in the following:

  • civil service reform, including reducing the number of ministries, diverting noncore functions, and decentralizating to local governments the functions specified under the 1995 constitution;

  • capacity building in the legal sector and in the judiciary;

  • establishment of the Institute of Certified Public Accountants of Uganda, and the training of accountants;

  • strengthening the capacity for economic and financial management;

  • creation of a private sector foundation as the lead interlocutor between the government and the private sector; and

  • enhanced utilization of information technologies and systems.

Role of Technical Assistance

Where does technical assistance fit in? Uganda recognizes that technical assistance can play a critical role in the transfer of skills, know-how, and technology from developed countries. A particularly useful form of assistance has been donor financing of qualified expatriate Ugandans who wanted to return from exile to take up jobs in the civil service. The financing was required for transport and relocation expenses for a short period of reorientation, including settling-in allowances and modest subvention expenses, after which the returnee would settle down to normal civil service pay and conditions. In addition, considerable assistance has been provided in the form of short-term and long-term foreign expertise—as well as civil service training, either on-the-job or off-site, in the country and out of the country.

The government has insisted on managing the technical assistance itself. A government document, Uganda Policy on Technical Assistance, published in May 1993, stated that

  • technical assistance must be meshed with national plans and budget priorities;

  • the government would take the lead in identifying technical assistance needs;

  • technical assistance would follow a country-program approach, rather than a project approach;

  • use of long-term expatriate advisers would be reduced to a minimum; and

  • technical assistance would no longer focus only on the public sector but could also be extended to the private sector (including nongovernmental organizations).

Good Governance

Turning now to good governance, what exactly is it? Good governance entails publicly accountable institutions of government that are capable of making and implementing policies in an efficient, transparent, and honest manner, thereby serving the wider public interest. It also entails efficient, effective, and transparent management of public expenditure, an efficient and equitable tax regime, a fair and effective legal and regulatory framework, political accountability in free and fair elections, and the observance of fundamental freedoms and rights of human beings. Lastly, it requires a clear separation of powers of the executive, the legislature, and the judiciary, as well as a recognition of the role of an independent press and media.

Uganda has had a history of poor governance but since 1986, the government of the National Resistance Movement has been undertaking a radical restructuring of the government, aimed at improving governance, democratizing and decentralizing power, and increasing transparency and accountability. The seventh point in the National Resistance Movement’s ten-point program concerns “the elimination of corruption and misuse of power.”

A milestone in the restoration of good governance and the rule of law was the drafting of the new constitution. A constitutional commission was formed to canvas the views of all segments of the population, a process that took several years. It then prepared a framework for the proposed constitution that was subsequently debated in a constituent assembly elected by the people. The resultant constitution in 1995 reestablished the principle of sovereignty held by the people as the repository of political power; established democratic institutions to ensure good governance, transparency, and accountability; codified respect for human rights, civil liberties, and the rule of law; and codified the decentralization of government to ensure that the people had control of the decisionmaking process and the allocation of resources.

The constitution also provided for a leadership code that requires specific officers to declare their incomes, assets, and liabilities every year and to explain how these were acquired. The code prohibits conduct that is likely to compromise the honesty, impartiality, and integrity of public officers, lead to corruption in public affairs, or be detrimental to the public good or to good governance. The code stipulates the minimum standard of behavior and conduct for leaders receiving gifts and other benefits in kind. And it specifies the legal sanctions to be taken against a leader who violates the provisions of the code.

In addition, special institutions were created to deal with corruption and the abuse of power, including the Office of the Inspector General of Government, and the Auditor General—who is an independent officer of parliament reporting to the Parliamentary Accounts Committee. The various committees of parliament have also reasserted their oversight roles on the policies and expenditures of ministries and governmental departments.

This spirit of better governance is also woven into Uganda’s economic reform program. The program aims at opening up and liberalizing the economy, and increasing competition, which, among other things, eliminates the opportunities for rent seeking. This is done through the dismantling of price controls, eliminating administrative allocation of foreign exchange, liberalization of all markets, and privatization of state-owned enterprises.

But liberalization is not enough, especially where there is underlying market failure. Moreover, even with liberalization there are still many areas of interface between the public and private sectors that can provide opportunities for corrupt practices. For example, in the procurement of goods and services, prices may be increased to provide for commissions to corrupt public officers. Or, in the divestiture of state-owned assets to the private sector, the assets may not go to the best bidder or even sell at the right price. In such cases, corruption needs to be minimized by increasing competition and accountability. It is also vital to increase the transparency of the interface between the public officials and the private sector, level the playing field for all private sector participants, and reduce to the barest minimum the discretion allowed to government officials in the decision-making process.

What does an effective anticorruption crusade involve?

  • There needs to be open competitive bidding for all government contracts, with clear rules of the game and full disclosure of all relevant information.

  • Governmental agencies responsible for anticorruption activities must be able to effectively enforce sanctions.

  • Adequate civil service salaries—which will reduce, but not entirely eliminate, the marginal value of the payoff from corruption—are necessary but not sufficient for eliminating corruption. Measures are also needed to increase the benefits of being honest, and increase the probability of a corrupt official being detected and punished.

  • Auditors, police officers, investigators, prosecutors, magistrates, and judges must be honest and competent—and their agencies must enjoy independence, integrity, and adequate financial resources.

  • The crusade needs to embrace a wider constituency, particularly civil society and the general public. This entails public awareness programs on how corruption leads to economic waste and poses a danger to the social fabric.

One way to do this is through national integrity workshops, which Uganda has recently held throughout the country. A national integrity survey was also undertaken to collect information on the ordinary person’s experience and perceptions of corruption in the delivery of public services; provide insights into what interventions could help reduce corruption; and increase awareness among ordinary citizens of the need to tackle corruption, as well as enlist them as partners in the fight against corruption.

We intend to carry out these surveys at regular intervals and to publish the results—showing which departments and districts the citizens regard as most corrupt, and for which services the public expects to be asked to pay a bribe. This will help raise the cost of being corrupt, as the public becomes the watchdog against corruption, with the help of a vibrant and free press and media.

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