Professionalism in Public Service Management: The Making of Highly Qualified, Efficient and Effective Public Managers

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1 Professionalism in Public Service Management: The Making of Highly Qualified, Efficient and Effective Public Managers by Staffan Synnerström "My experience of bottles tells me that the bottleneck is always at the very top of the bottle." Swedish middle manager accused of forming a bottleneck in his organisation. Introduction In this paper I will try to outline why public managers are important for the success of public administration reform, and how the performance of public managers in central and eastern European countries (CEECs) could be improved. The paper is not based on empirical research. It provides my personal views on a very important subject based on five years practical experience within the SIGMA Programme at OECD, where my work has been related to the establishment of civil services in the CEECs. The reform needs in most CEECs make the performance of public managers extremely important; and the situation in these countries makes it difficult to find well-performing managers. While the needs for good managers are vast, the supply is limited. Governments cannot meet the competition from the private sector. In addition, the legal frameworks, institutional capacities and systems necessary to recruit, develop and retain good managers are still weak, if in place at all. In this paper I will concentrate mainly on the legal frameworks and institutional and management structures necessary for making good managers. In doing so I will concentrate on the highest officials in government, with the presumption that much of what is needed to improve the performance of top managers is also needed to improve the performance of managers at other levels. I will therefore not look at the training necessary for making good managers. Although training is crucial in this respect, it is at the same time a broadly and well-recognised precondition for making good managers. Nor will I look at other means to inculcate shared values necessary for a common public management. The Importance of Public Managers The quotation above from the frustrated middle manager in the Swedish tax administration clearly illustrates the importance of having good public managers at higher levels. Without appropriate top managers, an organisation cannot achieve its optimum. With sub-standard managers at the top, the performance of an organisation becomes poor, and operations tend to get blocked -- the bottleneck. The bottleneck is also present in organisations lacking systematic mechanisms for delegation and for accountability. Although the performance of top managers is crucial, it is of course equally important to have corresponding quality in the performance at all management levels.

2 Western European countries have, for a long time now, recognised the fact that management standards and the performance of managers are critical for the success of public administration reform as well as for general public administration performance. Programmes to improve the selection and development of top managers have been a normal part of public administration reform for the last years. Among all the reasons for the existence of such programmes, two are striking: When public administration reform means, as it does in several western European countries, delegation and devolved responsibilities, when it means giving up power-sharing in decisionmaking and ex ante controls in favour of power allocation to managers and ex post controls, the quality of the managers vested with these powers becomes a more than essential consideration. And when national policy-making, becomes more and more complex and more and more exposed to international coordination, as in all countries, the need becomes evident for top managers with holistic perspectives and an ability to coordinate their work with both national and international institutions. France, with its career system and its corps, has by tradition defined groups of senior officials. Individuals at the top of their career are in each corps centrally managed and are assisted in career development through training and mobility. The state always has a pool of competent individuals to select from when a top position needs to be staffed. Other countries are now establishing similar defined groups of top managers who are centrally selected, appointed and managed. The Netherlands, with its devolved administration, is developing a Senior Public Service with a strong emphasis on the professional development of managers and on improving coordination capacities. More information on developments in this respect in OECD Member countries can be found in The Senior Civil Service - A Comparison of Personnel Development for Top Managers in Thirteen OECD Member Countries (PUMA/HRM(97)2), and in the SIGMA newsletter, Public Management Forum, Vol. III, No. 2, In Top Management Service in Central Government: Introducing a System for the Higher Civil Service in Central and Eastern European Countries (SIGMA Paper no. 1), Professor Jacques Ziller analyses solutions in some OECD Member countries with a view to providing options for central and eastern European countries. That kind of senior civil services does not yet exist in any CEEC but some of the countries are gradually introducing special policies and management mechanisms for the highest officials in government. Hungary, Poland and Latvia are examples of countries that are currently implementing reforms related to top managers, although with very different approaches. Other CEECs are in the planning phase. Rationale for Public Administration Reform In 1989/1990 CEEC governments had two major reasons to reform their administrations: to make the administrations ensure democracy, and to make them ensure a market economy. Later, a third reason was added in ten of the countries: to integrate with Europe and to facilitate accession to the European Union.

3 A democratic administration should represent the stability and continuity of the state. It should, under the constitution, be ruled by law and not use the public powers and means that it has been entrusted with in an arbitrary way. The execution of these powers should be protected from partisan interests, and it should be controlled through transparent mechanisms and by impartial institutions. It should interact with the public in a transparent and serviceoriented way. An administration in a market economy should not be, in the first place or mainly, occupied with the production of goods and services. Its task is to create fair and equal preconditions for economic activities through regulation, and by monitoring the activities through impartial institutions, in order to establish a competitive private sector. This has nothing to do with the fact that states are producing goods; it only means that production is not a task for the core administration of the state. An administration in a country aiming for European integration should be able to implement effectively EU regulations within the national context. Although the European Union does not have any direct powers in relation to how countries should organise their governance system and public administrations, the membership and accession to the Union presuppose certain capacities and qualities in countries administrations. An administration in a country aiming for European integration must be able to cope with all the preparations and negotiations required in the process, and to adopt and implement the "acquis communautaire". The objectives for ensuring democracy and a market economy have already been achieved, to a large extent, in the majority of the CEECs in terms of necessary legislation and institutions. There are of course still shortcomings in the enforcement of the legislation and in the functioning of the institutions in all countries due to a scarcity of financial and, particularly, human resources. At the same time, some CEECs are still in the process of reforming the administration to ensure the basic objectives of democracy and a market economy, i.e. redesigning the role of the state. The Administrative Heritage Public administration reform is a continuous process in all western European countries. For reasons dictated by changes in substantive policies or financial constraints, and for purposes of achieving greater efficiency, internationalisation, service-orientation, etc., western European governments are continuously adapting their public administration to changing requirements and demands. All the CEECs need to reform their public administrations for the very same reasons and purposes, and most evidently for the reason of financial constraints and the purpose of internationalisation. To understand the needs for public administration reform and the possible ways of achieving results in a given country, one must have an understanding of the national administrative context. Although each CEEC has its special context and traditions, there are some administrative characteristics that could be, and to a certain extent can still be, found in most of the countries. These charecteristics are the heritage from the communist administration, and they should be the target for reform in all CEECs. These characteristics and the impact they still have in CEEC administration give public administration reform different preconditions than in most older democracies.

4 To make it brief and simple, one could say that an administration in a democracy, functioning in a market economy, should sustain at least the following basic qualities: i) guarantee of fundamental rights ii) legal certainty and predictability iii) balance of powers iv) instruments of accountability and control; transparency v) coherence within government Communist administrative structures and procedures did not emphasize any of these qualities, but instead contradicted them. This is still a general starting point for public administration reform in CEECs. The heritage is still part of the explanation for sometimes slow progress in the development of, e.g., horizontal government functions, such as the policy-making process, the law-drafting process, the budget process, financial control, audit, and the staffing and management of personnel in the administrations. The heritage includes the following characteristics: The Lack of Coherence and Coordination In the communist administrations sectoral ministries managed their activities down to the lowest level. Political and strategic decisions, including those related to funding, were coordinated and taken within the party structure, not within the administrative structure. In the old system, there was therefore no real need for coordination between government institutions. The centre of government, including the Prime Minister and the Ministry of Finance, was weak and did not have the policy-making, coordinating or financial authority that it has by tradition in western democracies. Although much of this has improved in CEECs, through the establishment of new constitutions, territorial reforms, restructuring of government, new institutions, improved budget laws and budget procedures, etc., the lack of cohesiveness and the low coordination capacities still prevail in CEEC government administrations. In many cases no clear systems exist for delegation of powers and officials have no clearly defined accountability. In western governments, civil servants on various levels have the authority to take decisions or to make agreements on behalf of their institution in the coordination process. They have a clear definition of their authority in relation to others, i.e. a mandate, through regulations and job descriptions, and their accountability is defined in law. Coordination negotiations are usually put up to the next level only if an agreement cannot be reached on a lower level, and few final decisions have to be made on the political or ministerial level. In most CEEC governments the situation is different by tradition. First of all, there used to be, during the first years of transition, a clear mistrust of incoming elected officials for officials who had been appointed and had worked in the old system. This mistrust can still be seen in some of the countries when new governments come into office and is one of the reasons for

5 the fact that non-political officials in a ministry are not given clear mandates. But there are also structural or systemic weaknesses. Coordination procedures are inadequate and systems for the delegation of responsibilities are lacking. Coordination issues are therefore often pushed upwards, appearing unsolved on the agenda of the Council of Ministers. Negotiations between ministers then have to take place in regular government meetings, with long and demanding sittings as a consequence. Without mandates and defined accountabilities for officials, negotiations cannot be concluded, and problems cannot be solved at levels below the highest political ones, and often not below the Council of Ministers. In the absence of a permanent role and professional integrity for the higher non-political officials, this mistrust will remain. Also administrative issues will continue to be dealt with at political levels and from a political point of view rather than from an administrative one. So what appears to be a problem of a lack of horizontal coordination is, to a great extent, a problem of a lack of vertical delegation, i.e. a lack of defined roles and mandates for officials within a ministry. It is partly also a matter of mistrust, which is a vertical problem as well. The low capacity for horizontal coordination, reinforced many times by coalition governments without common political programmes, could be addressed through the selection and management of the highest non-political officials, i.e. through top management reform. The Lack of Coordinated Staffing and Personnel Management Another characteristic of the old administrative structure was that each ministry and state institution was an independent employer, defined by and subject to the regulations of the Labour Code. No common standards for selection, recruitment, promotion or personnel management existed. Each institution had its own regulations, and each minister or head of institution could freely choose or change his or her staff, even at the highest levels. In the field of labour law, each institution was regarded as an independent legal entity. There was no notion of the state as a common legal entity with institutions acting on delegation and on behalf of the state in issues related to employment and personnel management. This part of the heritage still prevails in CEEC administrations of today, and to a large extent even in countries that already have civil service legislation in force. There are a number of reasons behind the fact that countries have failed to break this uncoordinated and even fragmentized structure for staffing of the administration and for personnel management. One of the reasons is the fact that in most countries no clear division exists between what should be political posts and what should not. In an administration staffed and managed under a labour code, it is at the discretion of the minister or the head of institution to define when political merits are necessary and when they are not. Although formally a labour coderegulated administration is not defined as a spoils system, it will always become a spoils system in practice. The power to select staff is one important and attractive power for ministers. By using this power they can surround themselves with individuals whom they know and can rely on instead of taking on staff they don t know and may mistrust By using this power ministers

6 can also reward individuals for their political work, e.g. during election campaigns. Line ministers do not easily accept a system where their staffing capabilities would be much more limited and subject to special standards and procedures, perhaps even meaning that decisions related to the highest officials would be taken at the centre of government rather than by themselves. From their point of view, such a reform would not necessesarily represent an improvement. It would mean, in a short-term perspective, that they would have to give up an important power without getting much in return. As important stakeholders in any top management or civil service reform, line ministers will not automatically become convinced of the benefits of such reforms. Few CEEC governments have so far had the interest or the power to convince or actually force sectoral ministers to accept a new and unified structure for decision-making related to the staffing of higher management positions in the government administration and for the career management of the position-holders. This leads to the continuation of political staffing of crucial positions in the administrations, a spoils system which is de facto although not de jure. This does not mean that individuals selected on political grounds are not fit for their jobs; in many cases they are of course well qualified. But in the long term such a spoils system means a lack of continuity and a lack of professionally independent input into the decision-making process. It also maintains the lack of delegation of responsibility to positions in government at lower levels than the clearly political level, as the decision-making and coordination will continue to take place within the political structures of the administration. The Lack of Administrative and Management Professions In the old system there was no understanding of a common state administration profession, such as being a civil servant. Each job in the state administration was regarded as a specialist job in the employing institution with limited career bridges to jobs in other institutions and without clear professional criteria also valid for a job elsewhere in the state administration. Mobility between different institutions was not encouraged and was rare. Due to the tradition that everyone was a specialist within a special technical field, and the fact that the coordination of policies and between institutions was done within the political structure, there was no need for generalists or managers with a broader perspective than that of their own technical field. The kind of permanent management positions that can be found at higher levels within Western civil services was, and still is in most CEECs, the prerogative of the political class. Non-politically selected managers were, and in many cases still are, competent specialists within their field of expertise, providing technical contributions but rarely ensuring management and coordination. Public administration reform in CEECs should therefore aim to establish a management profession in the administration. But how can relevant powers and responsibilities be transferred from political structures to administrative ones and how can professional managers be made capable of managing these responsibilities?

7 Or, to use the terminology of this conference: how do you establish the scope for professional managers, and how do you professionalise them? Professionalisation of the Administrations in the CEECs Professionalisation is of course a question of training of managers and staff, but this is not all. It is of course also a question of introducing regulations defining duties, accountabilities and corresponding rights of staff, as in a civil service law; but that is not enough. It is also a question of improved personnel management and management standards, but it involves much more besides. It is to a large extent a question of establishing an administrative context in which officials can carry out their duties in a professional, impartial, transparent and controllable way. Professionalisation is therefore not only about the professional quality of staff and about their status. It is very much about: i) the quality of substantive law, providing the substantive framework for decision-making, i.e. the "tool" for the officials and the source of information and prediction for the public. ii) the quality of procedural legislation, providing procedures for administrative decisionmaking, for coordination and for balancing of powers, for officials relations and communication with the public, and providing opportunities for concerned physical or legal persons to have a say or to appeal. iii) the quality of financial and administrative accountability and control mechanisms, providing for transparency, checks of financial and administrative decision-making and including means for correction, prosecution and redress. Professionalisation is a much wider task than implementing civil service laws and introducing personnel management improvements. If the administrative context within which officials are working is not also improved, they might still have to make arbitrary decisions, with insufficient communication with the public and insufficient coordination with other institutions, even in a situation where they have been selected on merit and are subject to systematic training. Objectives for Top Management Reform I think it is reasonable to say that top management reform should aim at the following: i) improved quality of the outputs of public institutions This objective can only be met by a combination of measures related to the position of the manager and to the corporate functioning of the organisation. The administrative context must be addressed, as stated above. The managers should have a clearly defined responsibility for the output-quality, and there should be incentives for improvement. ii) improved efficiency and cost-effectiveness in public institutions To meet this objective it is necessary to address the role of the manager in the organisation in

8 a broader way, e.g. rather than just in terms of appointment conditions. The responsibilities of managers, especially in relation to the political levels, the accountability, the decision-making and reporting structures, must be clearly defined, and financial management and mechanisms for financial control need to be addressed as well. If not, there is a risk that top management reform will end up as a "one man show", with limited impact on the performance of the organisation. iii) better coordination between public institutions This is an objective which can be reached through top management reform. Establishing a professional group of permanent managers selected on common qualitative criteria and subject to common training and networking activities supporting a common corporate spirit, will improve both the understanding for coordination and the capacity to do it. But the administrative context must also be addressed. The permanent managers must have a defined responsibility, an obligation to coordinate and a mandate to take decisions and to come to agreements on behalf of the institution. In addition the government procedures for coordination should establish preconditions for efficient coordination. iv) improved professional continuity and development within public institutions Since top management reform should build on the establishment of a civil service where managers and other civil servants have permanent status and are selected on professional merit, and whose dismissal or transfer is subject to special legislation, it goes without saying that the professional continuity will be improved. The improved job security provided by the legislation will support behaviour characterised by professional integrity. For the professional development of managers and others, there should be training related to improved management skills and to management in an improved administrative context. v) reduced scope for nepotism and corruption This should be one objective for each top management reform, as it should be for general civil service reform. To meet the objective of preventing nepotism, it is necessary to select managers on merit, using transparent criteria, communicated across and even outside the administration. The decision-making must be shared in such a way that the immediate superior should not be the only one to take the final decision on selection. There should either be collective decision-making, e.g. through commissions of some kind, or the "grandfather principle" should be introduced. This principle for balancing powers means that decisions on selection or recruitment is formally taken at the level above the immediate superior. Subsequently the highest civil servants or managers should formally be appointed by a decision of the Council of Ministers or the Prime Minister. To reduce the scope for corruption is of course a more complicated objective to reach. Corrupt behaviour might vary from one country to another and from one culture to another. What is regarded as a bribe in one part of Europe might be considered normal social behaviour in another part. But at the same time certain behaviour should be regarded as corrupt in any democratic state. In addition to the selection mechanisms above, a clear professional role must be established for managers and other civil servants which is based on shared values i e a public service

9 ethics. Incentives for refusing corruption should be built into salary schemes. Corruption should be openly discussed, and how to fight and resist corruption should be on the agenda of any training programme for managers. In addressing public service ethics the PUMA Ethics Infrastructure is a useful tool. It is published in Ethics in the Public Service: Current Issues and Practice (PUMA Occasional Paper no.14). In order to fight corruption at the top levels of the administration, the administrative context must be the right one. There should be a balance of powers in decision-making, justification of decisions, transparency and freedom of information. Functioning mechanisms must be in place for the control of the appropriateness of decisions, as well as functioning mechanisms for correction, prosecution and redress. Finally, if the permanent staff in an administration is subject to all these measures to prevent corruption, it is necessary that permanent managers and civil servants also have the mandate to act with integrity towards their political masters, to react against improper action and to refuse participation in inappropriate decisions without risking their career or social situation. vi) increase the public trust for the administration Public managers at all levels have a crucial role in improving the relations between the administration and the public and the way in which the public perceives the actions of officials. Managers should have the responsibility, within the administrative context, to improve the quality of the output, to improve external communications, to develop services and to explain to the public what the public institutions are doing and why. This is necessary also when special government communication and information programmes exist. This important long-term, and yet everyday, task can only be pursued by managers who are selected in a way that the public can both understand and accept. There must also be a clear perception outside the administration that officials are selected on merit, and that they are carrying out their professional tasks under the rule of law. It should be clear that they are the ones found to be best suited for the job through a transparent and competitive process. vii) attract and retain qualified individuals for management positions This objective can be reached through introducing pay reform and permanent status, in combination with an improved definition of the role of managers in the operations of their institutions and in relation to their political masters. Although it is easy to define in theory the means to reach this objective, it is still very difficult to implement them. To raise salaries significantly for officials is difficult in times of financial constraints and budget deficits. Any country can of course afford to raise the salaries for a very limited number of officials. The question is then whether such a limited scope for a pay reform will have any impact on the general performance of the institutions if the pay reform does not gradually continue down to other levels of the administration as well. The objective to attract and retain qualified individuals is often used as the first argument for civil service reform or for top management reform. To attract and retain good staff is extremely important. But rather than an objective per se, I would say it is a means to reach the operational objectives set out under i)-vi) above.

10 However important the attraction and retention objective is, top management reform cannot be carried out merely through raising salaries with everything else remaining unchanged. Governments which aim to reform the management of public administration mainly by increasing the salaries of a limited number of officials without changing the administrative context, including the system for their selection and their professional role, risk ending up with an even lower confidence of the public, and without any guarantees for improvement in the administrative context or in the deliveries from the institutions. It is also difficult to get acceptance from the public for a pay reform as long as it does not perceive that officials are selected on professional grounds through a transparant and competitive procedure. How to carry out Top Management Reform Permanent higher officials and managers selected on merit is an essential condition for a successful public administration reform and for improved administrative performance in the CEECs. It is a prerequisite for professional continuity and for depoliticization of administrative decision-making. At the same time, the establishment of permanent top officials implies a dramatic change of administrative and staffing procedures in more than one CEEC, and will be seen by some as an interference in the traditional - and appreciated - prerogative of politicians. Three aspects must therefore be considered in top management reform, in addition to all technical issues: The first is the need for a strong political commitment behind such a reform. Without strong and active backing from the Prime Minister and from the centre of government, a reform aiming to change the selection and management of higher officials, as well as their roles in the government machinery, will fail. The second is that the reform must be accepted by affected line ministers. Line ministers will have to give up one of their most appreciated powers, at least to some extent. This must be justified by the fact that they will benefit from this sacrifice in terms of improved quality of the professional support they can expect within their domains. But it must equally be understood and accepted that it will take some time before the investment in professional managers will give full return to the politicians giving up their powers. It will take some time before sufficient numbers of qualified managers will be in place. The third absolutely crucial point to consider is the need for creating a system of selection and management of managers which is transparent, and which guarantees that the individuals are selected on their professional merit and none other. If a system is implemented without such guarantees, the selected managers will never be accepted by political parties in opposition. On the day when goverment will change, the new leadership might change the system and everything will once again start from square one. There must be a political consensus and common understanding among all important political parties that such a system represents an improvement. These considerations are mainly of a political nature, but they have to be taken into account. In order to establish permanent managers on higher levels, there are a number of more technical issues that have to be addressed, in addition to the political considerations. There are specific needs related to the positions and to the management of the managers For managers

11 at lower levels, the same structures and management systems should be applied as developed for the top managers, with possible differences in the pace of implementation, remuneration and career management. The following needs can be identified. Borderline political/professional positions The first thing that needs to be done is to separate the political positions from the permanent ones. This can be done in two ways. The first is to transform existing political postions into permanent ones, e.g. to change the positions of, say, a state secretary or vice minister into a kind of permanent secretary position. The second way is to keep the political positions political, and instead introduce new permanent positions into ministries, such as secretarygenerals or director-generals. The first option was chosen in Hungary but in my opinion is not feasible in most of the CEECs. And the question is if it is even desirable in these countries. In all CEECs there is a tradition of strong politicization which cannot be broken overnight. Trying to do so would result rather in a manipulation of the system than in actually professionally selected vice ministers or state secretaries. The fact that most countries are governed by coalition governments adds to the need for political leadership in ministries and of political projects. The second way is probably more feasible. It is easier to establish new functions than to try to change traditionally political ones. The fact that ministries in many CEECs have very flat organisational structures with heads of departments reporting directly to the political level facilitates the introduction of one level, in between, of permanent managers. Introducing this top permanent level would not be aimed at bringing in more red tape into the administration but would rather be a means of ensuring "good bureaucracy" and of actually facilitating the translation between political and permanent levels of an institution. Establishing a new kind of permanent top position will raise a crucial problem of scope in relation to existing political positions. What should the new officials responsibilities be? How will they be able to establish themselves as a power center within structures that are used to functioning without them? They will need support by means of clear definitions of their functions and powers within the institutions. They will also need external support from a central management capacity and from their colleagues in other institutions. I think it is realistic to give the new permanent top officials responsibility for the functional services of the organisation. They should be responsible for financial, organisational, personnel and legal affairs within their institutions. With time they will be able to strengthen their position within their institutions, due to their continuity. They should eventually become a general link between the political and professional levels of the institutions, providing professional, impartial input to decision-making, and acting externally on behalf of the institutions. With this kind of new high-level professional, permanent managers in place, the scope for political staff might eventually become reduced as the role of the permanent staff or of professional managers at lower levels will be upgraded. So instead of totally abandoning political positions overnight, their numbers might be gradually reduced as the permanent parts of the institutions develop their capacities and as the cooperation between the political and

12 professional levels improves. Civil Service Legislation In my opinion it is absolutely necessary to define, in public legislation, ie a civil service law, the duties, accountabilities and rights of officials entrusted with public powers and managing public funds. Duties and accountabilities cannot be agreed between a state institution and an individual in a private law employment contract under the labour code. Regulations in a general labour code are not sufficient for officials to whom the authority of the state is delegated. A civil service law should strike the balance between the duties and the accountabilities implied in a public office and the rights securing the professional integrity in carrying out the office. A civil service law should thus contain provisions protecting the civil servants from unjustified interference. But it is equally important that a law should contain provisions aiming to raise or safeguard the professional quality of the staff subject to the law. This is crucial for the development of better public managers at all levels. The primary goal of a civil service law is not to define better and safer employment conditions for public employees. The primary goal is for the state to safeguard a certain quality, professionality and impartiality in the performance of the administration, while certain improved appointment conditions will become necessary means to reach the primary goal. Civil service laws are not yet common in the region, although the passing of such laws has been on the reform agenda in most countries for a long time. In fact, civil service laws are in force only in Hungary, Estonia, Latvia and Poland. Civil service laws have in addition been passed, but not yet implemented, in Lithuania and Albania. Instead of enforcing the existing law, Lithuania is currently drafting a new law. No other CEEC has succeeded in passing a civil service law, although drafts exist or have existed in most of them. There are many reasons for this, the main reasons probably to be found in the financial situation and in the mistrust between political factions as well as the mistrust of politicians for existing employees. The fact that many draft laws have been drafted as labour codes for civil servants, aimed at improving their employment conditions but neglecting the need to raise the quality of the administrative performance, has added to the difficulties of having the laws passed. It is necessary to pass a special legislation defining the duties, accountabilities and rights for civil servants, if a layer of new top managers is to be established and is to function properly. It is necessary to give them sufficient protection to be able to act with professional integrity in traditionally highly politicised contexts. This is also necessary in order to improve the performance of managers in the administrations in general. Central Management Capacity One problem with the inherited administrative structures is the lack of coordination of staffing of the administration, and the lack of common standards for personnel management. The fragmentation should be broken and personnel management should be harmonised within

13 government administrations. This calls for some kind of central capacity for the management of the civil service. The competence and the institutional character of such a capacity should also be defined in a civil service law. It can be a unit preparing decisions for the Prime Minister or for the Council of Ministers. It can be a special ministry or it can be a separate institution reporting to the Prime Minister, etc. The civil service should be regarded as a common management function within government, with the selection and management of the civil servants based on professional criteria and on common standards. To issue such standards and to monitor the management within the state institutions are important tasks for a central management capacity. It should of course not be directly involved in the staffing of and personnel management in the government institutions. But it should draft government regulations related to the civil service, issue guidelines, provide advice and monitor career management throughout the civil service. And if a new layer of top officials is introduced into an administration, there will be a need for a central capacity both for the selection of them as well as for their career development. New secretary-generals or director-generals should not be appointed directly by the line ministers (cf. the "grandfather principle" above). The power to appoint should be shared with the Prime Minister or with the Council of Ministers in a balanced way. Decisions related to these officials careers should formally be taken at the centre and prepared by this central capacity, independently from the more narrow sectoral interest. Selection Mechanisms The system for selection is one of the most crucial areas in top management reform, as mentioned earlier. While a system for the selection on professional merit of civil servants in general, and of middle managers, can be introduced without major conflicts, the system for selection of top managers cannot. It is therefore extremely important that a system for selection provides for transparency, and that guarantees exist that the most suitable person is selected. If that is not the case, or even if it is perceived not to be the case, there will be mistrust towards those individuals appointed, from both the public and from the political opposition. On the other hand, it must be possible to recruit individuals with a background of political affiliation to permanent top positions, at least for the first generations of top officials. Many top officials in most CEECs have that background. The important thing is that once selected, political affiliation should cease and the selected manager should act in his or her work according to civil service standards, and his or her performance should be impartially monitored.. Decision-making Structures As said earlier, there must be balanced power-sharing in the decision-making related to staffing of the administration.this is necessary to really guarantee a selection on merit and to prevent nepotism. Two principles for balancing powers could be used. One is to establish collective bodies for the decision-making, e.g. a kind of civil service commission. The other is the "grandfather principle", where selection and appointment decisions are formally taken one level up. Decisions related to selection, appointment and careers of the very top officials should be taken by the centre of government i e by the Prime Minister or by the Council of

14 Ministers. The two principles for balancing powers could also be combined. In a civil service system with permanent managers and officials, it is important that decisions related to their selection and career management do not lie solely with one person, especially since that person will be in the position on a political mandate and for a limited period of time. Ten Conclusions 1. Improving the quality of public managers through selection, training and career management, and by improving the administrative context in which they have to work (professionalisation). 2. Defining professional top management positions and protecting the professional selection to these positions as well as the professional integrity of the position-holders. 3. Defining the status of civil servants, and particularly the top permanent officials, in a special law, a civil service law. The law should strike the balance between duties and accountabilities implied in a public office and the rights provided to safeguard the professional integrity of managers and other civil servants. The law should further strike the balance between the professional qualitative demands on the officials and the benefits offered to ensure that sufficiently qualified individuals will be attracted and retained. The law should not cover officials employed in political positions. 4. Establishing a central capacity within government to ensure a common or harmonised management of top officials and of the civil service. 5. Establishing a separate system of unified selection, appointment, training and career development for the very top officials. This could be an additional task for the central civil service capacity. 6. Recognising that the making of high quality managers is a broader task than just providing them with training and improving their appointment conditions. It is equally important to recognise that it will take some time before investments to improve the quality of managers will give full returns. 7. Recognising that implementation of civil service reform based on a new law is a long-term process. It should be done gradually for reasons of limited civil service management capacities and for reasons of financial constraints. Top management reform should be included in any early implementation phase, but reform should not stop at the top levels. 8. Recognising the need for a broad political consensus on civil service reform and especially on a new system for selecting, appointing and developing top managers, in order to avoid manipulation of the system and undesired changes when government changes. It is equally important to have civil service reform, and especially top management reform, recognised and accepted by the public as well as by other kinds of employees in the state administration. 9. Recognising that top managment reform should aim to improve both the coordination capacity within government and the cooperation between permanent professional levels of

15 government and political levels. The raised quality of permanent managers should lead to an upgraded role for the permanent levels in the government decision-making and in the administrative process. Such improved translation between political and permanent levels should be to the benefit of government. 10. Being pragmatic in the implementation of reform and especially recognising the need for special transitional provisions and mechanisms in the early stages of any civil service or top management reform.