Building Trust through E-Government: Leadership and Managerial Issues Subhash Bhatnagar Professor, Indian Institute of Management, Ahmedabad

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1 Building Trust through E-Government: Leadership and Managerial Issues Subhash Bhatnagar Professor, Indian Institute of Management, Ahmedabad Abstract Erosion of citizen s trust in Government due to rampant corruption at various levels in the Government ought to be an area of serious concern for developing countries and development agencies. A well-planned e-government strategy can build a more efficient, accountable and transparent government. If planned in consultation with representation from key stakeholders, e-government applications can rebuild citizen trust in government, by improving service delivery, reducing corruption and empowering citizens to participate in advancing good governance. The paper discusses few examples of egovernment where corruption was significantly reduced and draws lessons on leadership and managerial issues in deploying ICTs to combat corruption. What is Public Trust? According to an OECD report public service is a public trust 1. Citizens expect public servants to serve the public interest with fairness and to manage public resources properly on a daily basis. Fair and reliable public services inspire public trust and create a favorable environment for businesses, thus contributing to well-functioning markets and economic growth. The OECD report identifies a number of core public service values as being important for building citizen trust. These include: impartiality; legality; integrity; transparency; efficiency; equality; responsibility and justice. Many of these core values have been compromised with the spread of corruption in its various manifestations in many developing countries. UNDP defines corruption as the misuse of public power, office or authority for private benefit through bribery, extortion, influence peddling, nepotism, fraud, speed money or embezzlement 2. Corruption is principally a governance issue a failure of institutions and a lack of capacity to manage society by means of a framework of social, judicial, political and economic checks and balances. In the wake of globalization and increased pressures for improving governing institutions, there is a global demand for accountable and transparent governance. Strategies to Reduce Corruption Two major factors that contribute to the growth of corruption are the low probability of discovery, and perceived immunity against prosecution. Secrecy in government, restrictions on access to information by citizens and the media, ill-defined / complex and excessive rules, procedures and regulations can all lead to a low chance of discovery. A lack of transparency in the functioning of government agencies can make it easy for the perpetrators to cover their tracks thus making unearthing of corruption very difficult. The weak character of institutions which are supposed to investigate charges of corruption and prosecute the guilty, as well as an inefficient or corrupt judiciary further exacerbate the problem of corruption and facilitate immunity of perpetrators against prosecution. Strategies to reduce corruption must therefore 1 OECD (2000). Building Public Trust: Ethics Measures in OECD Countries. Retrieved from 2 UNDP (2004). Anti-Corruption Practice Note. Retrieved from 0edited% pdf

2 target multifaceted reforms in the legal system, judicial processes and functioning of agencies delivering services. The extent of corruption needs to be measured and media needs to sensitize the society to the long term detrimental effects of corruption. Can egovernment help in Combating Corruption? For some years there has been anecdotal evidence of impact on corruption from a large number of egovernment case studies from developing countries. However, recent studies 3 that assessed impact of eight wide scope and scale projects from India and two in Chile provided more concrete evidence (see Figure 1 below for an assessment of Indian projects). Corruption existed in six out of the eight projects before the service delivery was computerized. After computerization two projects were able to reduce corruption to a very significant extent and in 4 others there was a marginal reduction. The study used a systematic survey of 250 randomly selected clients (users) who had used both the manual and computerized systems in each project, seeking data on whether bribes were paid to get the service, amount of bribes paid, perception of corruption within the service delivery agency and perception on quality of governance in addition to several other attributes of a service delivery system. Two projects studied in Chile 4 also showed that corruption was reduced. However, the fact that impact on corruption varies across projects suggests that the factors that contribute to success and failure in tackling corruption need to be studied further. Figure I Proportion paying bribes (Percentage) AMC Bhoomi Bhoomi RTC CARD Checkpost eprocurement eseva Kaveri Khajane DDO Khajane Mutation Payee Manual Computerised There have been two general approaches used to integrate e-government in anti-corruption initiatives. First, e-government can become one of the key components of a broader anti- 3 Study titled Impact Assessment Study of E-government Projects in India submitted to Department of Information Technology, Government of India; and Impact Assessment Study of Computerized Service Delivery Projects from India and Chile submitted to the World Bank, Washington. A presentation on the findings from the eight Indian projects is available at 4 ChileCompra and Tax Online in Chile showed reduced corruption.

3 corruption strategy as is demonstrated by the OPEN system installed in the Seoul Municipality in the Republic of Korea 5. Second, service delivery improvement initiatives can be implemented in corrupt departments, specifically targeting transparency and reduced corruption as objectives. An example is the Bhoomi project in India. Both these cases are discussed in detail. Integrating E-government in Anti-corruption Initiatives Efforts to prevent corruption can be complemented with e-government strategies that review and clarify procedures and practices, and design systems that simplify, standardize and de-personalize the delivery of services. Of course this needs to be complemented with civil service reform, as well as, societal education efforts in reducing tolerance to corruption and reinforcing fundamental values such as honesty. E-government can also help monitor corruption and hence better enforce laws and policies that ensure accountability and transparency by standardizing data collection methods, tracking actions and decisions and developing a feedback/complaint mechanism. This needs to be complemented with the development of institutions, laws and practices that protect whistleblowers, imposing of powerful disincentives for corruption and punishment for those involved in corruption. A major part of the OPEN Initiative was focused on the simplification of regulations and procedures, reengineering of work practices, transparency in procedures, effective communication with the citizens, and training, rather than the technology. Technology was used as a tool to achieve its goal. Two factors, in particular contributed to the success in implementation. First, there was strong leadership provided by the mayor and second, widespread citizen participation. OPEN Initiative, Republic of Korea In 1998, Seoul s Mayor initiated an anti-corruption programme, the Online Procedures Enhancement for Civil Applications (OPEN) Initiative, which opened up governmental procedures to the public. This project is widely recognized as an effective example of political and managerial commitment to transparency and for its impact on corruption. A review team analyzed the entire set of civil applications for permits and approvals, and identified 26 categories of civil applications that most frequently caused irregularities and inconvenience to citizens. A development team prioritized the details to be made public on a web portal. For each of the 26 categories, the OPEN website contains information on application procedures and contact information of departmental persons-in-charge so that citizens can monitor applications and raise questions in the event any irregularities are detected. Examples of civil applications include: building permits and inspection; approval and sanction of entertainment establishments and song bars; and decision and change of urban development plans. A total of 5,000 employees in 485 city departments dealing with applications were trained to operate the system and add and change the data. Following training, usernames and passwords were assigned to allow each individual trainee to make entries at his or her department. Results from surveys by the Audit and Inspection Division of the city government and Transparency International showed very positive results in combating corruption. In a 2005 survey, 69% were satisfied with the system and 64% thought that the system helped preserve transparency in administration. The number of visitors to OPEN is about 1.3 million. The number of improprieties in 8 key departments came down by 54-83% in one year. There is an implicit hierarchy of objectives that e-government applications must consider in an anti-corruption programme. Increasing access to information; presenting the information 5 The URL of the document on OPEN which mentions results of a survey is:

4 in a manner that leads to transparency of rules and their applications in specific decisions; and increasing accountability by building the ability to trace decisions / actions to individual government officials, represent the successive stages in the hierarchy. All these objectives in tandem can curb corruption significantly, and ignoring some of them can defeat the whole purpose. Media, as an alert watchdog, plays a significant role in providing information and generating widespread debate around significant issues of public concern. There is no specific sequence in which different kinds of reforms are introduced. Often they run a parallel course, depending on the state of the starting condition. E-delivery of Service Targeting Corruption Prone Departments In the state of Karnataka in India, one of the first egovernment applications to be implemented was Bhoomi for computerization of land records 6. Department dealing with land records are known to be corrupt and mismanaged in the entire sub continent of South Asia. The project achieved success because it made the data transparent. Any one can get a copy of any land record. Processes were reengineered to take away unnecessary discretion from civil servants to delay or deny the service. Now all applications are accepted at a computerized kiosk and date stamped. The applications must be processed in a FIFO order, taking away the power to expedite any transaction. Thanks to a central Government grant, the revenue department could create an adequate infrastructure to support the Bhoomi initiative. An investment of Rs million was used to equip 206 centers with hardware / software and connect such centers to a state wide area network. A central data center was built to which all the data on land records is uploaded. Eight hundred kiosks set up by a private partner can print the RTCs in rural areas by accessing the central data base over the Internet. The Bhoomi Project, India The Bhoomi project which was able to eliminate corruption is analyzed. The Bhoomi (meaning land ) project developed an online system that delivers land records to the farmers in Karnataka, India. Prior to the Bhoomi project, an estimated 9,000 village accountants (each serving 3-4 villages) maintained the land records in Karnataka. These records were not open to the public and farmers had to bribe the accountants to obtain a copy of the Record of Rights, Tenancy and Crops (RTC), a record that is mandatory for various purposes such as bank loan application. The Bhoomi Project computerized 20 million land records by capturing legacy data records maintained by the village accountants. A copy of the RTC can now be obtained by anyone after providing the name of the owner or plot number and a fee of INR 5.00 (USD 0.33) at computerized kiosks in the 206 sub-district offices. The clients can also see the transaction online through a second computer screen facing them. Nearly 800 rural kiosks can also issue a copy of the RTC. When a change of ownership takes place through sale or inheritance, farmers can file an application at the kiosk. The requests can only be processed on a first-come-firstserve basis. Each request is assigned a number that can be used by the client to track the status of the application on a touch-screen in some kiosks or by asking the kiosk operators. The Revenue Inspector will approve the request within the prescribed period (30 days from the notice date) if the request is valid. Following verification, a notice is automatically generated by the computer system to the affected parties and the system updates the particular land record. Operators of the computerized system are made accountable for their decisions and actions through a login system. The number of RTC transactions nearly doubled from 6.56 million to 12 million per year in last 4 years. The number of mutations grew from 0.29 million in 2003 to 1.03 million in Growth in transactions indicates increasing trust in the system. 6 Bhatnagar, Subhash and Chawla, Rajeev (2007), Online delivery of land titles to rural farmers in Karnataka. In Deepa Narayan and Elena Glinskaya (Eds.), Ending Poverty in South Asia: Ideas that Work, pp World Bank. Also see Bhoomi Project Website:

5 Resources were committed to build organizational and individual capacity by training all employees from senior officials to clerical staff. To allay the fears of field officials, twelve state-level information seminars were organised for 1,200 senior and mid-level officers. Additionally, four division-level workshops were organised to train 800 officials. These seminars emphasised that maintenance of land records was only one of their many functions and that computerisation would remove the drudgery of maintaining these records manually. Reducing corruption was not a key message at these gatherings although it was one of the explicit objectives in conceptualizing the project. Using e-government to fight corruption is often incidental and not part of the design objectives in most projects. The political executive was completely involved in the computerisation project. The state chief minister and revenue minister highlighted the importance of the project publicly. The chief minister wrote regularly to all district deputy commissioners, exhorting them to get fully involved in the computerisation. He inaugurated a large number of land record kiosks. Meanwhile, the revenue minister regularly reviewed the computerisation process and also inaugurated a large number of kiosks. A committee of Members of the Legislative Assembly (MLAs) visited the kiosks and deputy commissioners invited MLAs of their districts to witness the functioning of kiosks. All this helped demonstrate that there was a strong political will for computerisation. The Way Ahead Above examples lend credence to the belief that technology can transform government s often-negative image. In many countries, citizens view their governments as bloated, wasteful, and unresponsive to their most pressing needs. Mistrust of government is rife among the public and businesses. Civil servants are often seen as profiteers. Although, e- government should not be seen as a panacea for the complex and well-entrenched problems of corruption, e-government is one of the many tools whose potential in tackling these problems needs to be recognized by decision makers. Unfortunately, reducing corruption has not been a part of many reform programs and e-government initiatives. The following suggestions can go a long way in creating the enabling environment that will foster many more anti-corruption initiatives. Build political commitment: Mere existence of anti-corruption and e-government strategies does not guarantee that corruption will be curbed. Commitment of political elites (including adequate financial resources) is of key importance to the success of all government anticorruption programmes, including those with ICT component. Backed by political leadership, project leaders can reengineer processes that take away arbitrary power from civil servants and political commitment could lessen the traditional resistance to change. The cross-cutting and multi-stakeholder nature of e-government initiatives makes it more important that there is strong leadership and political commitment among different government ministries and agencies. Political commitment needs to be demonstrated through specific actions. Provide legal support: E-government can lead to transparency provided that the legal framework supports free access to information. Until a few years ago most countries still had strict national secrecy laws. These were repealed in favour of Freedom of Information Laws in the U.S. and much of Europe, but only after decades of lawsuits. Secrecy laws are still in effect in much of the developing world. India did well to enact a freedom of information act in 2005 which is already bearing fruits. Whereas in most developing countries criminal laws penalise specific forms of corruption, laws must also punish attempted corruption and breach of core values enunciated earlier. Clear and known procedures that facilitate the reporting of wrongdoing and provide protection for whistleblowers can assist the detection of individual cases of misconduct.

6 Promote access and use: Increasing availability of information on the Internet is not sufficient. Providing universal access, promoting literacy, fostering people s participation in governance are some of the key challenges of any e-government applications. Media, as an alert watchdog, plays a significant role in providing information and generating widespread debate around significant issues of public concern. Show evidence: Much of the evidence linking e-government with reduction in corruption is anecdotal. Only in a couple of cases has the impact on corruption of e-government applications been audited independently. Systematic surveys of citizens and other stakeholders can help establish the linkage more clearly and will also provide invaluable feedback on the parts of the system that need improvements. References Bhatnagar, Subhash (2003). Access to Information Report: E-Government. In Robin Hodess, Tania Inowlocki and Toby Wolfe (Eds.), Global Corruption Report London: Profile Books Ltd. Bhatnagar, Subhash (2004). E-Government in the Asia-Pacific Region: An Assessment of Issues and Strategies. Retrieved from Subhash.pdf Bhatnagar, Subhash (2004). E-Government: From Vision to Implementation. India: Sage Publications. Bhatnagar, Subhash (2004). Public Service Delivery: Does E-Government Help? In Sadiq Ahmed and Suman Berry (Eds.), proceedings of Annual Bank Conference on Development Economics South Asia Component, pp World Bank and National Council of Applied Economic Research, New Delhi. Wescott, C. G. (2003). E-Government to Combat Corruption in the Asia Pacific Region. In proceedings of 11 th International Anti-Corruption Conference. Seoul, Republic of Korea. Retrieved from