In the mid 2000s, Indonesia’s Directorate General of Taxes (DGT) was still struggling to recover from the shock of the Asian financial crisis of the previous decade. Tax revenue had plummeted during the crisis, and the collection rate remained well below accepted standards, as well as below the standards of many peers in the region. In 2006, the directorate’s new leaders launched a nationwide overhaul, drawing lessons from a successful pilot program that had reorganized the DGT’s biggest offices and enabled large taxpayers to settle all of their tax-related affairs with a single visit to one office rather than having to go through multiple steps. Expanding that pilot to more than 300 locations across a 3,000-mile archipelago presented no small challenge. The implementers built a digital database that linked all offices to a central server in the capital of Jakarta, developed competency testing and training that bolstered the quality of staff, and created new positions to improve relationships with taxpayers. Other measures aimed to reduce corruption and tax fraud. When political and practical crosswinds frustrated the DGT’s efforts to build the workforce its leaders thought it needed, the agency turned to big-data analytics to improve compliance and broaden the tax base. By 2018, domestic revenue mobilization had plateaued, but the changes introduced had produced important improvements. The question was then what to do to broaden the base further without decreasing incentives for investment or raising administrative costs to unsustainable levels.

Leon Schreiber drafted this case study based on interviews conducted in Jakarta in January and February 2018. Case published April 2018.

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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.

In 2002, Lithuania was struggling to defeat corruption, which had flourished during the Soviet occupation. Once viewed as the key to survival in an administered economy, offering gifts for services had become an accepted social norm. More than a decade after Lithuania regained independence, polling showed that although 77% of Lithuanians considered this form of corruption a problem, few were willing to change behaviors they saw as practical. The country’s recently created anti-corruption agency, the Special Investigation Service, faced the challenge of changing those social expectations. It decided to focus on a new generation of Lithuanians. The Modern Didactics Center, an educational nongovernmental organization, and a dedicated group of teachers stepped in to help the agency work toward the ambitious goal of changing the attitudes of students across the country. The group experimented with a variety of educational approaches both in and outside the classroom, including a curriculum that integrated anti-corruption elements into standard subjects and projects that encouraged students to become local activists. Despite resistance from educators that limited the program’s scale, the effort developed new approaches that illuminated the ethical and practical downsides of corruption for students across the country.

Maya Gainer drafted this case based on interviews conducted in Vilnius, Mažeikiai, and Anykščiai, Lithuania, during February 2015. Case published June 2015.

Lagos State began the twenty-first century as a boomtown crippled by crime, traffic, blight, and corruption. A regional economic hub and burgeoning state of 13.4 million people, the megalopolis had a global reputation for government dysfunction. Two successively elected governors, Bola Tinubu and Babatunde Fashola, worked in tandem to set the state on a new course. Beginning in 1999, their administrations overhauled city governance, raised new revenues, improved security and sanitation, reduced traffic, expanded infrastructure and transit, and attracted global investment. By following through on their promises to constituents and forging a new civic contract between Lagos and its taxpayers, Tinubu and Fashola laid the foundations of a functional, livable, and sustainable metropolis.
 
Gabriel Kuris drafted this case study based on interviews conducted by Graeme Blair in Lagos, Nigeria, in August 2009 and by Kuris in Lagos, in October 2011 and in Providence, Rhode Island, in November 2012. Case published July 2014.

Associated Interview(s):  Babatunde Fashola, Bola Tinubu

A once proud city, Bogotá was on the verge of ruin by the late 1980s. Its government was corrupt and dysfunctional, and the Colombian city regularly ranked among the worst places in the world in which to live. In 1986, then-president and former Bogotá Mayor Virgilio Barco lamented that “of that booming city that I governed, today all that is left is an urbanized anarchy, tremendous chaos, immense disorder, a colossal mess.” Beginning in 1992, however, Bogotá enjoyed a string of mayors who succeeded in turning the city around. The first of these mayors, Jaime Castro (1992-1994), fought to establish the financial and political framework that would empower the mayor’s office to function as a nucleus of reform. Castro’s successor, Antanas Mockus (1995-1997 and 2001-2003), built on that legacy, consolidating gains in the face of entrenched opposition on the city council and bringing tangible benefits to the population in the form of exemplary public-service delivery. By 2002, the United Nations had selected Bogotá as a “model city” to be emulated across Latin America and by early 2010, Mockus had emerged as a front-runner in Colombia’s presidential elections.

Matthew Devlin and Sebastian Chaskel drafted this case study based on interviews conducted in Colombia during October and November 2009.

Associated Interview(s):  Jaime Castro Castro,  Liliana Caballero, Maria Isabel Patiño

GENERAR Y CONSOLIDAR UNA VUELTA DE PÁGINA: GOBERNABILIDAD EN BOGOTÁ, 1992-2003

SINOPSIS: La otrora ciudad imponente, hacia fines de los años '80 Bogotá se encontraba al borde de la ruina. El gobierno distrital se caracterizaba por la corrupción y el mal funcionamiento, y la capital colombiana frecuentemente se ganaba un lugar en el ranking mundial de los peores lugares para vivir. En 1986, el antiguo alcalde de la capital y por ese entonces presidente Virgilio Barco se lamentó, "De la ciudad vibrante que yo goberné, hoy sólo queda una anarquía urbana, un caos tremendo, un desorden inmenso, un desastre colosal." Sin embargo, a partir de 1992 Bogotá tuvo la suerte de tener una serie de alcaldes que consiguieron pasar la página en la historia de la ciudad. El primero de aquellos alcaldes, Jaime Castro (1992-94), luchó para establecer la infraestructura financiera y política que le otorgaría a la Alcaldía el poder para funcionar como un núcleo de reforma. El sucesor de Castro, Antanas Mockus (1995-97 y 2001-03), siguió construyendo sobre los cimientos legados por su predecesor, y así consolidó victorias a pesar de la oposición profundamente arraigada del Concejo de la Ciudad, trayendo beneficios tangibles para la población en la forma de mejoras en la prestación de servicios públicos. Al llegar el año 2002, las Naciones Unidas habían seleccionado a Bogotá como una ciudad modelo a ser emulada a través de Latinoamérica, y para comienzos del año 2010, Mockus había surgido como un candidato formidable a la presidencia colombiana. Matthew Devlin y Sebastian Chaskel redactaron este estudio practico basado en entrevistas que se llevaron a cabo en Colombia, en octubre y noviembre del 2009. El caso fue publicado en diciembre del 2010. Melina Meneguin-Layerenza tradujo este estudio en febrero de 2013.

Matthew Devlin y Sebastian Chaskel redactaron este estudio practico basado en entrevistas que se llevaron a cabo en Colombia, en octubre y noviembre del 2009. El caso fue publicado en diciembre del 2010. Melina Meneguin-Layerenza tradujo este estudio en febrero de 2013.
 

Inaugurated as mayor of Medellín at the beginning of 2004, Sergio Fajardo inherited a city roiled by decades of violence and corruption. During his four years in office, the charismatic former university professor turned Medellín around. He broke up clientelistic political networks, raised tax receipts, improved public services, introduced transparency fairs, established civic pacts, and restored citizens’ sense of hope. Fajardo left office at the end of 2007 with an unprecedented approval rating of nearly 90%. Though Medellín still faced significant challenges, the city was later identified as an exemplary case of good public administration by cities across Latin America and the Inter-American Development Bank. By 2010, Fajardo had been named the vice-presidential running mate of former Bogotá mayor Antanas Mockus in that year’s presidential elections.