What needs to be reformed in the Spanish public administration?

Summary:

On 14 January 2021, the Rafael del Pino Foundation organised the dialogue "What needs to be reformed in the Spanish Public Administration". The event was attended by Elisa de la Nuez, Secretary General of the Hay Derecho Foundation; Jesús Fernández-Villaverde, Professor of Economics at the University of Pennsylvania, and Víctor Lapuente, Professor at the University of Gothenburg (Sweden) and visiting professor at Esade (Spain).

Victor Lapuente explained that there are two obstacles to the efficiency of the administration: its politicisation and its bureaucratisation. They are two pathologies that complement each other in a perverse way. Politicisation is our biggest problem. The institutional variable of the state apparatus most correlated with the efficiency of public sector performance is the level of politicisation, where political connections matter for a career in government. Spain is at the top of the emerging economies and at the bottom of the OECD in the politicisation ranking.

Regarding bureaucratisation, we have civil servants for life providing welfare state services when in other countries they were replaced by labour staff. This, together with highly bureaucratised procedures for dealing with the administration, with many ex ante controls, when other countries have moved to ex post controls, reduces the efficiency of the administration. What we should do is to move towards depoliticisation, for example, by introducing public managers, as they exist in most Western countries, who have career incentives to do things better. This goes against the culture of civil service bodies. Progress must also be made in de-bureaucratisation, giving more autonomy in the management of human resources. This has been done to some extent during the pandemic, for example, in hospitals, which prevented their collapse.

Jesús Fernández-Villaverde referred to his very disappointing experiences with the Spanish administration, both in terms of politicisation and bureaucratisation. He made an attempt to improve university education and was met time and time again with these tendencies. He was also surprised by the enormous bureaucratisation for secondary aspects. The deep reluctance to these changes is very important. We have to move from a mentality of ex ante controls to one of ex post controls. In Spain, a lot of paperwork has to be submitted and a lot of formalities have to be carried out, but nobody checks afterwards whether things have been done well or not. We have to start focusing on results and having systems that measure the consequences.

A frequent criticism against change is that Spain is full of Spaniards, that Spaniards are the way we are and that if we try to depoliticise and de-bureaucratise the administration this will never happen. This pessimism, however, is incorrect. Portugal and Ireland have changed their public administration. If they have been able to do so, so can we. Moreover, in the last forty years there have been sectors of Spanish society that have done very well. There is a clear reform agenda and these reforms are possible. It will not be easy, because of vested interests, but it is possible. We can have a more flexible, independent and results-oriented management system.

Elisa de la Nuez stressed that our administrations have clear problems of lack of management capacity, not only with the pandemic, which are aggravated by fragmentation. Also, for example, with European funds. Spanish society is perceiving this problem, for example, with the low rates of vaccination. This is not a surprise because excessive politicisation translates into a lack of professionalism, very reactive administrations and little planning. Politicisation leads to a penetration of the administrations that leaves aside a professional management that has the capacity to manage and anticipate events. It is no coincidence that countries that have depoliticised and de-bureaucratised their administrations have greater management capacity. Often policies are approved that cannot be managed due to a lack of resources, as in the case of the minimum vital income. There is another issue, the huge number of civil servants who will be retiring in the coming years. That is why now is the time to see what kind of profiles the administration we want needs.

The executive power thinks that if it assumes many competences it can alleviate this lack of capacity, but it does not take into account that the hands that should help it are missing. Faced with this problem, the politician's solution is to accumulate power, and when he finds that this does not work, he transfers the matter to the autonomous communities. It is a problem not of the political colour of the government but of management tools. The same thing happens with the European funds; it is very much concentrated on the political side but it does not work because the management elements are missing. Moreover, there is a feeling that the institutions and counterweights that help in the decision-making process and its implementation are being left aside.

Jesús Fernández-Villaverde added that, in the short term, two things are important. One is to avoid falling into the temptation of creating the typical management committee to do something, which is useless and is intended to replace institutions that already exist. The second issue is the attitude of many politicians to disregard the rule of law. Confinements must be carried out with respect for fundamental rights and duties, and judges must have a supervisory role. In this sense, we must understand that there are certain intuitions and that the best way to do things is not to eliminate them overnight, because we are increasingly becoming a presidentialist system, incompatible with our institutional system because Spain is a parliamentary democracy.

Víctor Lapuente recalled that decision-making is joint between politicians and civil servants who have the courage to tell politicians that this or that cannot be done. In Spain we do not have this because of politicisation and bureaucratisation. If ministers are part of these bodies, reform will be more difficult. Where public managers are allowed to pursue careers between the public and private sectors, administrations perform better.

Elisa de la Nuez said that there is a reluctance to analyse administrative structures from the point of view of how well they work. Things are always added, but nothing is ever evaluated or taken away. The resistance is mainly political, but there is also resistance from the people who work in these institutions. The Cora Report, which dealt with these issues, was in the end of no use, its recommendations did not go beyond the paper, for example, in the case of duplication between administrations.

Jesús Fernández-Villaverde warned that, in Spain, we sometimes fall into the sin of fetishising the number of administrations. But the problem is not so much the number of levels as the coordination between administrations. There are competencies that make sense to execute at the local level and others at the regional or national level. We have the feeling that each administrative structure had to be a replica of the structure of the higher administration. The issue, therefore, is coordination. Moreover, at the moment there are no mechanisms for civil servants to circulate between the different administrations. This kind of circulation would have a very positive effect on territorial coordination. Now is the time to sit down and think about how to organise this. We are now suffering from the ambiguity of the 78 Constitution. This has generated many problems that have accumulated over time and have surfaced during the management of the pandemic. In Spain there has been a lot of decentralisation so that there would be different things and, in the end, everyone ends up doing the same thing. So why has it been decentralised?

People do not appreciate that being a good manager is very difficult. In Spain, the idea that managing a group of people is a skill that very few people have innately and that those who do have it need to work at it. This is a key aspect in the management of administrations that is undervalued, both in the selection of personnel and in providing people with the mechanisms to learn to manage during their career in the Administration.

Elisa de la Nuez added, in this respect, that we have a recruitment system that is very much anchored in the functions that the administration had in the last century. Knowledge is prioritised, but not other qualities, and innovation is not prioritised. The question is what kind of talent is needed for an administration that has to do different things. It is also necessary to think about what messages are going to be sent. The idea is that the Spanish Administration is a refuge for labour.

Victor Lapuente highlighted five problems in this regard. We have few science, technology and IT profiles. We have little supply of qualified personnel. Thirdly, there is the ageing of public workers. Fourthly, there is the temporary nature of the workforce, which has increased to over 30% or 40%, with precarious contracts, generating an extreme duality between permanent and temporary staff. The fifth, and most important, is to ask children what they want to be when they grow up and most of them do not want to take competitive examinations when the public sector is more important than ever because it accounts for half of GDP and regulates even more. However, we have difficulty attracting talent. Therefore, we need to open up the system of entry into the administration, depoliticising the professional career.

Jesús Fernández-Villaverde also commented that, at the moment, if you enter the lower levels of the administration you are relatively better paid than in the private sector and you have stability. On the other hand, at the higher levels, salaries are not competitive with the private sector. This is why the public pay system needs to be reformed.

For Victor Lapuente there are two important issues. The first is the administrative culture. We belong to the Napoleonic administrative culture, which puts the principle of law before the principle of management, and that is a burden because it generates a very bureaucratic culture. There is also a national culture. The Spanish one has some particular traits. The first is statism. Spain is very statist; there is more trust in the state because there is less trust in the citizens. As a result, citizens demand more regulations from the administrations, which generates more corruption, which in turn generates more distrust. Finally, Spaniards want to avoid uncertainty, they are afraid of what might happen in the future, which leads to a greater preference for regulations and administrative interventions. In order to reform the administration, we must be aware of these aspects.

According to Jesús Fernández-Villaverde, there are things that can be changed in culture. To do this, we need to act in education, to teach students that nothing happens with uncertainty, that it is more important to know how to find information than to study a textbook. This would have a very important cascade effect on public administration. Many of these reforms have a horizon of fifteen or twenty years, so it must be explained that a country cannot be changed overnight.

Elisa de la Nuez pointed out that it is an inherited culture, of people who expect a lot from the state and little from society. But generational change is a unique opportunity to integrate people who assimilate a different culture. It is also necessary to act with incentives, which can facilitate this transition.

Jesús Fernández-Villaverde said that there are three ideas on reform to consider. Reform can be done. In Spain we have made much more difficult transformations, such as the Transition. Second, there is a purely intellectual aspect of saying it, repeating these things constantly. Third, civil society needs to get more involved, to show a commitment to change.

For Víctor Lapuente, the role of civil society is very important. If civil society plays a leading role, the reform will succeed. This is lacking in Spain. In our country, moreover, we have highly valued, highly motivated professionals. In the administration they are highly trained, but they are prisoners of a system that does not evaluate performance, that does not provide incentives.

Finally, Elisa de la Nuez stated that if we have such a strong state, we need an equally strong society. This is a matter for everyone. But the issue of civil servants is also important. They are prisoners of a system, but it is a relative prison. So they also have a role in reform, especially through their organisations. If that part has critical mass, things will happen in the end.

The Rafael del Pino Foundation is not responsible for the comments, opinions or statements made by the people who participate in its activities and which are expressed as a result of their inalienable right to freedom of expression and under their sole responsibility. The contents included in the summary of this conference are the result of the debates held at the meeting held for this purpose at the Foundation and are the responsibility of their authors.

The Rafael del Pino Foundation is not responsible for any comments, opinions or statements made by third parties. In this respect, the FRP is not obliged to monitor the views expressed by such third parties who participate in its activities and which are expressed as a result of their inalienable right to freedom of expression and under their own responsibility. The contents included in the summary of this conference are the result of the discussions that took place during the conference organised for this purpose at the Foundation and are the sole responsibility of its authors.

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