As Vietnam gradually became a middle-income country during the early 2000s, its tax agency struggled to keep up. In the decade and a half following the Communist Party–led government’s 1986 decision to establish a market-based economy, local entrepreneurs launched businesses, foreign investors poured into the country, and the average annual rate of economic growth soared to 7.5%. But during the same period, tax revenues declined as the General Department of Taxation (GDT), which previously collected almost all of the country’s taxes from a small group of state-owned enterprises, strove to keep pace with the economic dynamism. In 2004, the department established an internal reform team and adopted a strategy to make sure those who could pay covered their fair share of the cost of government services. The GDT worked with the finance ministry’s tax policy department and the parliament to implement a raft of legal changes. The department then reorganized each of its 758 tax offices along functional lines, rolled out a new IT system, improved staff training, and created a unit to bolster taxpayer compliance. It later adopted a personal income tax and tried—sometimes unsuccessfully—to close exemptions created earlier to attract foreign investors. Although its collection levels began to plateau after 2010, in the decade or so from 2004 to 2015 the GDT increased the number of registered taxpayers in the country to 15 million from 2 million and tripled the amount of taxes it collected annually, maintaining one of the highest tax-to-GDP ratios in East Asia.

Leon Schreiber drafted this case study on the basis of interviews conducted in Hanoi, Vietnam in May 2018. Case published in August 2018. 

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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.

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At the end of March 2014, the nongovernmental organization Médecins Sans Frontières warned that an Ebola virus disease outbreak on the border between Guinea and Liberia could unleash an epidemic of unprecedented scale. Its capacity still limited after a 14-year civil war, Liberia’s government was struggling to mobilize and coordinate the extra assistance its health ministry needed to respond. How to recruit, train, protect, and pay a labor force that included government employees, temporary workers, and many international volunteers were central concerns. In the best of times, coordinating this kind of skills supply chain would be challenging. But from June to the end of August, conditions became increasingly difficult. As the infection spread, many health workers died. In the absence of facilities and equipment that could provide protection, fear slowed recruitment—a problem made worse by severely constrained medical evacuation services and reduced airline access. Mobilizing personnel to respond raised questions about how to fulfill a duty of care toward employees, adhere to commitments to equality, and promote longer-term institutional sustainability. The Liberian government, UN agencies, and a wide variety of other organizations worked together to identify and deploy essential skills, develop shared practices, and find ways to pay Liberian temporary workers whose support was essential. UN organizations alone recruited and deployed 19,367 staff during the crisis, including Liberians, but questions remained about how to best meet the ethical and practical challenges that arose.

David Paterson and Jennifer Widner drafted this case study with advice from Béatrice Godefroy.

Princeton University’s Grand Challenges program supported the research and development of this case study, which is part of a series on public management challenges in the West African Ebola outbreak response.

Timeline: West African Ebola Outbreak (poster infographic)

Timeline: West African Ebola Outbreak (page version)

By the mid-2000s, Indonesia had recovered from a devastating economic crisis and made significant progress in transitioning from a dictatorship to a democracy. However, the country's vast state bureaucracy continued to resist pressure to improve operations. In 2006, President Susilo Bambang Yudhoyono tapped economist Sri Mulyani Indrawati to transform Indonesia's massive Ministry of Finance, which was responsible not only for economic policy making but also for taxes and customs. During four years as minister, Mulyani introduced new standard operating procedures, raised civil servant salaries, created a new performance management system, and cracked down on malfeasance. Her reforms turned what had once been a dysfunctional institution into a high performer. But ongoing resistance illustrated the difficulties and perils of ambitious bureaucratic reform in Indonesia.

This case study was drafted by Gordon LaForge based on research by Rachel Jackson, Drew McDonald, Matt Devlin, and Andrew Schalkwyk and on interviews conducted by ISS staff members from 2009 to 2015. Case published May 2016. Other ISS case studies provide additional detail about certain aspects of the reforms discussed in this case or about related initiatives. For example, see Instilling Order and Accountability: Standard Operating Procedures at Indonesia's Ministry of Finance, 2006-2007.

This case study offers an account of civil service reform efforts in Vietnam between 1998 and 2009, which yielded substantial formal policy changes but produced only modest practical changes to Vietnam's public employment system.  Before 1998, the Vietnamese civil service lacked standardized competitive recruitment and promotion procedures, offered salaries that did not cover the cost of living, provided insufficient and often irrelevant training, and included ministries that duplicated functions.  By 2009, the Ministry of Home Affairs had standardized and then devolved recruitment and promotion exams to line ministries and provinces, doubled civil service wages while giving agencies autonomy to raise wages further, expanded the enrollment of the National Academy of Public Administration by a factor of 20, and merged six ministries.  Nonetheless, government and donor officials reported that recruitment continued to be driven often by corruption, that even doubled salaries often did not cover the cost of living, that training was rarely relevant to civil servants' work, and that tasks continued to be duplicated in most of the merged ministries.  In order to concentrate on human resource management reforms, this case study does not consider other aspects of the Public Administration Reform agenda, including, for example, the institution of so-called one-stop shops designed to simplify administrative procedures.  Because public sector reform remained a sensitive topic in Vietnam in 2009, many interviewees asked that their names be withheld.

David Hausman drafted this case study on the basis of interviews conducted in Hanoi, Vietnam, in August and September 2009. 

Associated Interview(s):  Clay Wescott

In 1996, Mongolia’s newly elected government, led by a group of market-oriented politicians, decided to reform civil service on the New Zealand New Public Management model, which required managers to sign contracts promising results in exchange for freedom to spend their budgets as they chose. The reforms were intended to modernize a civil service that, while legally changed since democratization in 1990, retained many of the characteristics, and staff, of the previous Soviet-modeled system. Reformers confronted a lack of robust accountability procedures, salary arrears and a lack of central control over local expenditures. The Democratic Coalition government, led by an economic team strongly committed to market-oriented reforms, settled on the contract-based New Public Management model as a way of preserving agency-level decentralization while making agencies’ managers directly accountable to the national government. When enacted, the system met with difficulty at every stage: in specifying outputs for agencies and individuals, in measuring performance, and in rewarding good performance. By 2009, thirteen years after the reforms started, officials reported that the contracts remained largely a formality.

David Hausman wrote this case study based on interviews conducted in Ulaanbaatar, Mongolia, in December 2009. 

Associated Interview(s):  Mendsaikhany Enkhsaikhan