Contracting out (creating semi-autonomous agencies)

Reconstructing a City in the Interests of its Children: Tirana, Albania, 2015 – 2019

Author
Gabriel Kuris
Focus Area(s)
Country of Reform
Abstract

When Erion Veliaj became mayor of Tirana, Albania, in 2015, he inherited a fast-growing city with unchecked construction and traffic that threatened the health and well-being of all citizens—especially the youngest and most vulnerable. Overcoming public distrust and budgetary shortfalls, Veliaj’s administration worked with private donors and international experts to quickly construct parks, playgrounds, nurseries, schools, and pedestrian spaces. At the beginning of the mayor’s second term in July 2019, the city was poised to adopt new models for streets and neighborhoods redesigned to serve the interests of infants, toddlers, and their caregivers.

Gabriel Kuris drafted this case study based on interviews conducted in Tirana, Albania, in April 2019. Case published July 2019. Format revised January 2020. The Bernard van Leer Foundation supported this case study to foster early-stage policy learning.

Governing from a Child’s Perspective: Recife, Brazil, Works to Become Family Friendly, 2017 – 2019

Author
Bill Steiden and Sam Dearden
Focus Area(s)
Country of Reform
Abstract

In 2017, Geraldo Julio, the mayor of Recife, Brazil, heard scientific evidence that ensuring children from birth to age six years got a better start in life resulted in long-term benefits such as improved health, more-effective learning, less likelihood of criminal involvement, and increased employability. Julio, a technically-oriented leader in his second and final term, saw investment in early childhood development as an innovative strategy for addressing chronic crime and economic inequality in some of the city’s toughest neighborhoods. To enable parents and young children to move more safely and more quickly to locations where they could find efficiently clustered resources would require the city to align efforts in several city departments, including parks, public works, health, and education. Julio set up a management team and a steering committee to guide that work and won passage of legislation that authorized him to devote municipal resources and grant funding from private groups to the new strategy. The city engaged an existing public–private urban planning partnership to launch and manage pilot projects in two poor but contrasting neighborhoods: one where homes clung to steep, slide-prone hillsides and another where many residents lived in stilt houses on flood-prone riverbanks. It collaborated with a community peace center that could reach target neighborhoods effectively. Further, the mayor’s teams helped municipal departments start projects that would support the new agenda. In mid 2019, nearly two years after the program began, the pilot projects yielded key lessons about how to improve access to services for families with young children. 

Bill Steiden drafted this case study with the help of Sam Dearden based on interviews conducted in Recife, Brazil, in March and May 2019. Case published June 2019. The Bernard van Leer Foundation sponsored this case study, which is part of a series, to support learning in the early stages of its Urban95 program. Savvas Verdis and Philipp Rodeof the London School of Economics served as independent reviewers. 

Bolstering Revenue, Building Fairness: Uganda Extends its Tax Reach, 2014 – 2018

Author
Leon Schreiber
Country of Reform
Abstract

After a decade of reforms to boost tax collection, in 2014 the Uganda Revenue Authority (URA) faced up to one of its biggest remaining challenges. Although the agency had significantly improved its internal capacity—along with its ability to collect taxes from registered taxpayers—large numbers of Ugandans paid nothing because they were unregistered or because inadequate compliance monitoring enabled them to underpay. The holes in the system undermined public trust and bedeviled the URA’s efforts to meet the government-mandated target to raise tax revenue to 16% of gross domestic product. The URA then joined other government agencies to bring millions of unregistered citizens into the tax net, and it tightened the oversight of existing taxpayers who were paying less than their fair share. Prime targets were millions of Ugandans who worked in the informal economy, which the government said accounted for nearly half of the country’s economic activity. At the same time, the URA set up operations to go after wealthy and politically connected individuals who avoided paying their full tax load, and it created a separate unit to press government departments that failed to remit to the URA the taxes they collected, such as withholdings from employees. The URA’s program achieved strong gains on all three fronts and thereby helped increase the country’s tax-to-GDP ratio to 14.2% in the 2017–18 fiscal year from 11.3% in 2013–14. Just as important, the program made significant progress toward a fairer distribution of the tax burden for Ugandans across all economic levels.

Leon Schreiber drafted this case study based on interviews conducted in Kampala, Uganda, in January and February 2019. Case published April 2019.

To view a short version of the case, please click here 

See related Uganda Revenue Case Study: Righting the Ship: Uganda Overhauls its Tax Agency, 2004-2014

 

Righting the Ship: Uganda Overhauls its Tax Agency, 2004 – 2014

Author
Leon Schreiber
Country of Reform
Abstract

In the early 2000s, the Uganda Revenue Authority (URA) faced a crisis. Even after adopting a modernized legal framework that made the agency semiautonomous—able to operate much as a business would, though still accountable to a public board—the institution remained paralyzed by corruption, outdated technologies and procedures, and a toxic organizational culture. In 2004, to begin righting the ship, the URA’s board appointed 43-year-old Allen Kagina, who had served the agency for more than a decade, as the new commissioner general. Kagina engineered a radical overhaul that required all 2,000 URA staff members to reapply for new positions under a revamped organizational structure. A new modernization office overhauled tax procedures, upgraded the URA’s technology, improved anticorruption measures, strengthened the tax investigation and prosecution function, and enhanced staff capacity. At the same time, the URA was working to smooth its customs procedures and improve cooperation with partner countries in the East African Community. 

Leon Schreiber drafted this case study based on interviews conducted in Kampala, Uganda, in January and February 2019. Case published April 2019.

To view a short version of the case, please click here

See related Uganda Revenue Authority Case Study: Bolstering Revenue, Building Fairness: Uganda Extends its Tax Reach, 2014-2018

Funding Development: Ethiopia Tries to Strengthen its Tax System, 2007-2018

Author
Leon Schreiber
Country of Reform
Abstract

In its 2006 national vision to end poverty, Ethiopia set its sights on becoming a middle-income country by 2025. It was a hugely ambitious goal for a country that, at the time, was one of the poorest in the world. To support development objectives put on hold during a decade of political turbulence, including a costly border war with Eritrea that drained public coffers, the Ethiopian government sought to expand its resources by significantly boosting tax revenues. The new plan called for a sharp increase in the ratio of tax revenue to the size of the economy—and within four years. The government merged its separate customs and domestic tax offices into a single entity and restructured the new agency’s operations along functional lines, increased salaries, adopted stringent anticorruption rules, implemented a modern information technology system, and launched public awareness campaigns. It was important that the new revenue authority worked to improve its coordination with the tax offices of subnational governments, which operated with substantial independence under the country’s federal system. Although unproven charges of corruption against the Ethiopian Revenues and Customs Authority’s long-serving director general in 2013 stalled progress, a new round of IT and legal reforms in 2016 helped increase tax collection significantly: to US$7.8 billion in 2017 from US$1.3 billion in 2006 (measured in constant 2010 US dollars). Nonetheless, revenue gains continued to lag behind economic growth. In 2018, under a new prime minister, the government began to take further steps to strengthen tax collection.

Leon Schreiber drafted this case study based on interviews conducted in Addis Ababa, Ethiopia, in October 2018. Case published December 2018.

To view a short version of the case, please click here

 

Rebooting a Rust Belt City: An Innovation Office for South Bend, 2013-2018

Author
Tristan Dreisbach
Country of Reform
Abstract

When Pete Buttigieg became mayor of South Bend, Indiana, in 2012, the city was struggling to overcome its image as a dying community. More than a thousand abandoned homes blighted urban neighborhoods, and the unemployment rate was more than 10%. Although these problems had their roots in the changing structure of the US economy, Buttigieg said he believed that more-efficient and more-effective government could help the city attract new businesses and residents, charting a path forward. In 2013, he hired Santiago Garces, a 2011 graduate of nearby University of Notre Dame, to create a new office that would identify opportunities for improving city operations and saving money. On a tight budget, Garces assembled a small team of business analysts, who used new technologies to help streamline and modernize the city’s code enforcement department, greatly accelerating the process of dealing with abandoned homes. Garces’s team then took on dozens of other projects to improve service delivery while also consolidating the city’s information technology resources, including outsourcing certain services to cut costs. The unit Garces created produced millions of dollars in savings during its first years and helped the mayor achieve some of his top policy goals. 

Tristan Dreisbach drafted this case study based on interviews he and Steven S. Strauss, John L. Weinberg/Goldman Sachs & Co. Visiting Professor at Princeton University, conducted in South Bend, Indiana in July 2018. Case published September 2018.

The Foundation for Reconstruction: Building the Rwanda Revenue Authority, 2001-2017

Author
Leon Schreiber
Focus Area(s)
Country of Reform
Abstract

After the 1994 genocide that claimed hundreds of thousands of lives, Rwanda’s tax collection collapsed to $132 million in 1996 from $225 million in 1990. Aside from its desperate need for money to pay for reconstruction, the new unity government, led by Paul Kagame’s Rwandan Patriotic Front, was also determined to break its dependence on foreign donors by becoming entirely self-funding. To do that, Kagame’s government had to convince a traumatized and distrustful public to pay its fair share of taxes. In 1998, the government replaced the existing tax and customs departments with the Rwanda Revenue Authority (RRA), a semiautonomous tax agency. The RRA overhauled tax collection procedures, increased staff capacity, improved information management, and launched a massive and sustained public education campaign in an effort to build a new social contract. As a result, in 2017 Rwanda collected in three weeks the same amount of tax it had collected annually a dozen years earlier. From 1998 to 2017, Rwanda’s tax-to-GDP ratio improved from 10.8% to 16.7%, and total tax revenues collected grew more than 10-fold to $1.3 billion. Moreover, from 2007 to 2017 alone, the number of registered taxpayers grew 13-fold—from 26,526 to 355,128—though Rwanda was one of the world’s poorest countries and most of its labor force of 6.3 million still had incomes below the threshold that made them tax eligible. By 2017, the government financed 62% of its annual budget from domestic tax revenues, up from just 39% in 2000. The country was on its way to ending donor dependence.

Leon Schreiber drafted this case study based on interviews conducted in Kigali, Rwanda in March 2018. Case published May 2018.

To view a short version of the case, please click here

Cementing the Right of Ownership: Land Registration in Kyrgyzstan, 1999–2009

Author
Maya Gainer
Country of Reform
Abstract

In 1999, eight years after emerging from decades of Soviet domination, Kyrgyzstan began an ambitious effort to officially recognize property ownership throughout the country and lay the groundwork for a vibrant real estate market. During five and a half decades of rule by the Soviet Union, citizens were not allowed to own land, and after Kyrgyzstani independence in 1991, the country began a nationwide program of privatization in a bid to stimulate economic development. The question was how to register and document property rights so that people could transact efficiently in a new land market. To meet the challenge, a new land agency, known as Gosregister, had to hire and train staff in completely new responsibilities, establish performance management and funding structures, improve efficiency by introducing new technologies, and ensure that staff did not engage in corruption. Despite political upheaval—including the overthrow of two governments in the space of five years—Gosregister steadily built its capacity and evolved into an effective land registry. By 2012, the agency had registered 92% of the country’s privately held parcels, and in 2017, the World Bank’s Doing Business rankings recognized its services as among the best in the world.

Maya Gainer drafted this case study based on interviews conducted in Bishkek and Kant, Kyrgyzstan, during November and December 2016. The British Academy-Department for International Development Anti-Corruption Evidence (ACE) Program funded the development of this case study. Case published February 2017

Putting Rural Communities on the Map: Land Registration in Mozambique, 2007–2016

Author
Leon Schreiber
Country of Reform
Abstract

In April 2006, six international donor agencies established a program to help Mozambique’s government register community land rights and improve tenure security for rural residents. Under Mozambique’s constitution, the state owned all land. A 1997 law, adopted after a 15-year civil war, sought to recognize rural communities’ customary tenure rights while encouraging commercial investment through the issuance of 50-year leaseholds. But many communities failed to register their holdings with the central government, leaving their rights vulnerable to powerful state and corporate interests. To address the problem, the donor group established the Community Land Initiative (iniciativa para Terras Comunitárias, or iTC), a program to register community parcels in the government cadastre and empower communities to negotiate with potential investors. The iTC coordinated with national and local governments as well as nongovernmental organizations to map the borders of community lands. The program informed community members about their land rights and how to use and protect them. It also established natural resource committees, which enabled communities to receive shares of the natural resource taxes paid by commercial investors working on communal lands. The iTC further created producer associations to support budding commercial farmers, resolved boundary disputes, and worked with provincial cadastral offices to issue certificates that specified property boundaries. By mid 2016, the program had registered 655 communities in the government cadastre—nearly four times the estimated 171 community registrations carried out before the iTC was established. The registrations covered 6.9 million hectares and 10% of the country’s rural population.

Leon Schreiber drafted this case study based on interviews conducted in Maputo and Xai-Xai, Mozambique, in November 2016. The British Academy-Department for International Development Anti-Corruption Evidence (ACE) Program funded the development of this case study. Case published February 2017.  

A 2017 workshop, Driving Change, Securing Tenure, profiled recent initiatives to strengthen tenure security and reform land registration systems in seven countries: South AfricaCanadaJamaica, Kyrgyzstan, Mozambique, Australia and Tanzania.

Watch the video of Emidio de Oliveira - Director, iniciativa para Terras Comunitárias. 

Breaking New Ground: Pioneering Electronic Land Registration in Ontario, 1987-2010

Author
Maya Gainer
Country of Reform
Abstract

In 1987, Ontario’s land registration system was overwhelmed. Budget constraints and a surge in property sales were straining the Canadian province’s paper-based operation. After struggling to computerize its land records during the previous seven years, civil servants at the provincial Ministry of Consumer and Commercial Relations led a groundbreaking effort to form a public–private partnership to convert millions of property records—both from paper to digital and in some cases from a deeds system to titles—and create the world’s first electronic land registration system. During the partnership’s first 12 years, beginning in 1991, the provincial government and joint venture company Teranet worked to persuade sometimes skeptical politicians and real estate professionals of the value of their model and laid the groundwork for a lasting relationship even after the government sold its ownership stake in 2003. Despite early financial challenges and a slower-than-expected conversion process, Teranet and the Ontario government pioneered technology that became a model for the world, simplified transactions for the province’s landowners, and built a relationship that continued to offer value for both partners in 2016, 25 years after the partnership began.

Lessons Learned

  • Designing a successful PPP. The public–private partnership between Ontario and private joint venture company Teranet facilitated greater investment in innovative technology. Close collaboration, the use of existing government capacity, and strong governance structures were crucial for maintaining an effective working relationship—even after the government sold its stake in Teranet in 2003.
  • Challenges of converting deeds to titles. Creating a new form of title and setting precedents for the handling of unusual properties helped speed the conversion from a deeds to a titles system. But despite efficiency gains, the process remained time- and resource intensive.
  • Stakeholder relations. A close relationship with entities such as the law society and a gradual rollout of new technology eased real estate professionals’ acceptance of electronic registration. Later, those relationships played a key role in measures to prevent fraudulent transactions.
  • Private versus nonprofit incentives. As a for-profit company, Teranet had an incentive to focus on commercial, value-added products after developing the electronic registration system. In contrast, British Columbia’s nonprofit Land Title and Survey Authority reinvested its revenues in its registration and mapping systems.

Maya Gainer drafted this case study based on interviews conducted in Toronto, Vancouver, and Victoria, Canada, in August and September 2016. The Omidyar Network funded the development of this case study. Case published January 2017.​