Poverty Task Force Localizing MDGs for Poverty Reduction in Viet Nam: Ensuring Good Governance for Poverty Reduction June 2002 Strategies for Achieving the Viet Nam Development Goals Acknowledgements The bulk of the preparation of this draft paper was undertaken by Edmund Attridge, Staff Consultant, in ADB Vietnam Resident Mission (VRM). Stefan Nachuk provided research and drafting assistance, and Dao Viet Dung, also from VRM, provided research support. The paper benefited from close interaction with members of a Sub-group on Governance and Public Management Indicators which included: Mr Phan Van Diem, International Cooperation Department, GCOP; Mr Nguyen Minh Man, Director, PAR Department, OOG; Mr Tranh Quoc Phuong, PSRP Assistant, General Economic Department, MPI; Ms Nguyen Thi Kim Thanh, Deputy Director, Monetary Policy Department, SBV; Mr Nguyen Huy Ngat, Director, International Cooperation Department, MOJ; Mr Le Huu Cat Dien, Assistant to Resident Representative, Growth and Government Unit, UNDP; Mr Soren Davidsen, Programs Officer, UNDP; Ms Lindy Cameron, Governance Adviser, DFID; Mr Takao Shimakao , Representative, JBIC; Ms Amatsu Kuniaki, Project Formulation Advisor, JICA; Ms Luong Mai Dung, Assistant Program Officer, JICA; Mr Mark McPeak, Country Director, Plan International; Ms Rosemary Greve, Director, ILO Hanoi; Ms Nisha Agrawal, Chief Economist, World Bank, Hanoi; Ms Mandy Woodhouse, Country Representative, Oxfam; Mr Isabeau Vilandre, Country Representative, CECI Vietnam; and Mr Alessandro Pio, Principal Country Officer, ADB. FOREWORD BY THE POVERTY TASK FORCE * This series of papers on the Vietnam Development Goals (VDGs) reflects a collective effort by the Poverty Task Force to propose a set of goals and intermediate indicators, which represent both the core developmental vision of Vietnam as well as the Governments efforts to meet international goals. This analytical work was carried out during 2001 and early 2002 as the Government of Vietnam drafted a Comprehensive Poverty Reduction and Growth Strategy (CPRGS) and was trying to establish a clear accountability framework for monitoring future progress. This process involved looking across the many goals and targets incorporated in key strategy documents (especially the Ten Year Socio-Economic Development Strategy and the ten-year sectoral strategies) to select a small number of goals that could reflect the strong national strategic emphasis on economic growth, poverty reduction and social equity. Although national strategies were used as a starting point, the CPRGS drafting team was also aware that international commitment to achieving important poverty and social outcomes across the globe had intensified an effort expressed in the Millennium Development Goals (MDGs). The MDGs are a set of goals embodied in the Millennium Declaration, which has been adopted by 180 countries including Vietnam. Areport on progress made in Viet Nam towards achieving the goals was prepared by the UN Country Team in July 2001. The Government wanted to ensure that the CPRGS reflected their commitment to the international targets. For a number of reasons, however, it was important to adapt the MDGs to fit local circumstances rather than adopting them in their original form. First, Vietnam has reached, or nearly reached some of the MDGs. Poverty, for example, has already halved between 1990 and 2000. It makes sense, then, for Vietnam to define a new localized version of the poverty goal in order to motivate policy formulation over the coming years. Secondly, thoughVietnam performs well on some of the access targets for example in basic education there are urgent challenges associated with improving the quality of those services to international levels. While it is clearly still important to strive for universal primary education, for example, it is also important to make sure that the children in school are attaining standards that are similar to other countries. Thirdly, Vietnam has its own strategic planning cycle with different start and endpoints from the MDGs. It is helpful to align the 25-year cycle of the MDGs with the five and ten year cycles of the Vietnamese planning horizons so that measures and actions can be tailored to outcome targets for 2005 and 2010 which are, in turn, consistent with targets for 2015. Fourthly, there is a call for establishing subnational targets to capture, for example, issues related to ethnic minority development or inequality. Finally, there are areas which are particularly challenging for Vietnam at its current stage of development but which are not covered by the MDGs. As an example, although Vietnam has performed well in delivering basic social services, it has lagged behind in initiating necessary governance reforms which will be crucial to attaining some of the other outcome targets proposed in the national strategies. This series of papers was prepared to contribute to the Governments thinking on target-setting and monitoring in eight thematic areas: Eradicating poverty and hunger; Reducing vulnerability and providing social protection; Providing quality basic education for all; Improving health status and reducing inequalities; Ensuring environmental sustainability; Promoting ethnic minority development; Enhancing access to basic infrastructure ; and, Ensuring good governance for poverty reduction. *The Government-donor-NGO Poverty Task Force has been working collaboratively on poverty analysis (World Bank et al, 1999) and strategic planning since 1999. While the CPRSG was being drafted, the PTF comprises 16 Government ministries, 6 donors, 4 international NGOs and 4 local NGOs. FOREWORD BYTHE POVERTYTASK FORCE No separate paper was produced on promoting gender equity for two reasons. First, it was considered important that gender issues were mainstreamed across these eight areas. Secondly important issues outside these eight areas were already being addressed as the Government formulated its Second Plan ofAction for theAdvancement of Women. Early versions of these draft papers were discussed at a 3-day workshop held in September 2001 attended by nearly 100 policymakers and practitioners. Government agencies, NGOs and donors have all participated in the working groups established to oversee the production of these documents. Further consultations on the drafts took place with sectoral ministries and agencies over the early part of 2002, the most intensive drafting period of the CPRGS. The CPRGS has been approved by the Prime Minister in May 2002 and outlines a set of goals and indicators which clearly reflect the analytical work and debates that have taken place over the last year. A slightly shortened, summarized table of VDGs (as articulated in the CPRGS) is included at the end of this paper. Now that these papers are finalized, we hope that they will serve as a useful input for the implementation of the CPRGS, including the preparation of annual action plans. CONTENTS EXECUTIVE SUMMARY ....................................................................................................................... iv PART I: INTRODUCTION ....................................................................................................................... 1 PART II: GOOD GOVERNANCE AND POVERTY REDUCTION ......................................................... 2 PART III: SELECTING INDICATORS IN GOVERNANCE / PUBLIC MANAGEMENT .................... 5 A. Improved governance is not an end in itself but a means to an end .............................................. 5 B. Applying four principles of good governance to poverty reduction ................................................ 6 C. A brief overview of governance indicators ................................................................................. 6 D. Choosing the indicators ............................................................................................................7 E. Possible governance / public management outcome indicators ..................................................... 8 F. Recommended indicators .......................................................................................................... 8 PART IV: BASELINE AND TRENDS: IMPROVING GOVERNANCE AND PUBLIC MANAGEMENT SO AS TO SUPPORT POVERTY REDUCTION ............. 13 A. The experience in reform of governance / public management in Vietnam ................................. 13 B. Recent development in good governance in Vietnam ................................................................ 14 PART V: KEY FACTORS TO ACHIEVE GOALS AND RELATED POLICIES .................................. 16 PART VI: MONITORING ....................................................................................................................... 19 A. Developing process indicators ................................................................................................. 19 PART VII: NEXT STEPS ........................................................................................................................ 21 BIBLIOGRAPHY .................................................................................................................................... 22 Poverty Task Force: Ensuring Good Governance for Poverty Reduction iii EXECUTIVE SUMMARY Governance is a cross-cutting issue. It affects every government, particularly at local levels; and a sector of development. Weak governance, due to a government which fights corruption and waste at all combination of inefficient service delivery, inadequate levels. policy settings and other causes, has a disproportionate impact on the poor. Improvements in governance are Based upon these parameters, eight core governance therefore essential to poverty reduction. indicators have been developed for future use and then for refinement through more specifically expressed There are four pillars of good governance, which support indicators at the sectoral level: building more effective and efficient institutions of government: accountability, transparency, participation, 1. Level of information publicly available and predictability. Reforms to governance should regarding services, policies and planning embrace these four principles. arrangements at all levels. 2. Extent of access of the poor to basic To date, reforms to governance and public management, government services such as health, such as through restructuring, have only had a limited education, infrastructure, water and power at impact on the poor. Reforms affecting the poor have the local level. included establishing administrative courts, simplifying 3. Level of budget transparency regarding bureaucratic procedures such as under the Enterprise provincial and local taxation, budgeting, and Law; setting up a small number of one-stop shops for spending patterns in each sector. service delivery. Further reforms are planned under the recently-approved PublicAdministration Reform (PAR) 4. Extent to which, at the national level, the Master Program that should have a beneficial impact level of expenditure that is targeted to pro- on the lives of the poor. poor purposes is predictable from year to year. Greater focus is needed on whether improvements in 5. Extent to which the decisions and verdicts governance do benefit the poor. This depends on the of courts and tribunals are publicly available. outcomes in fact achieved. These outcomes include 6. Extent to which local government is increasing the empowerment of the poor; making the responsive and follows up on service delivery market economy work from the poors perspective, and problems that are raised with them by the poor. the building of the capability of the State in key areas so as to guarantee the equitable and universal provision 7. Extent to which the Grass Roots Democracy of effective basic services. Decree has been implemented in each commune so as to improve opportunities for The recent report Vietnam 2010: Entering the 21st public participation. Century1, identified five key areas for improved 8. Extent to which laws combating corruption governance. These are: a stronger, more efficient public are effective service which is capable of implementing policy and delivering better services to the people at all levels; better The indicators could be measured quantitatively using and more transparent public financial management; existing systems such as budget documents or, wider access to justice and ensuring that the same rules qualitatively, using client survey techniques such as a apply to all; more participative and responsive scorecard. 1Produced by the World Bank, Asian Development Bank and United Nations Development Program, November 2000 iv Poverty Task Force: Ensuring Good Governance for Poverty Reduction PART I. INTRODUCTION This paper proposes a series of governance and public next outlines baseline information on the governance management indicators to be used in assessing progress and public management experience in Vietnam and in meeting the poverty reduction targets in Vietnam, refers to some of the key factors and policies to achieve having regard to the Millennium Development Goals goalsinthisfield. Thepaperconcludeswithadiscussion (MDGs) for poverty reduction. This work is intended of arrangements for monitoring the indicators. to support the Government of Vietnams2 development of a Comprehensive Poverty Reduction and Growth Targets for governance and public management are not Strategy (CPRGS) The paper reflects the work and specifically covered in the International Development discussion undertaken by the sub-group (SG) that was Targets (IDGs) or the Millennium Development Goals formed by the Poverty Task Force (PTF) to consider (MDGs). In these circumstances, the PTF has asked these issues. the SG to consider international best practice and the Governments sectoral targets for the purpose of Governance is concerned with the overall institutional developing relevant indicators. environment in which citizens interact and within which economic, political, legal and administrative authority The SG recognizes that there is a natural desire to see are exercised to manage a countrys affairs at all levels. quite specifically expressed indicators put in place in It involves all the institutions of the State at the national Vietnam. However, there is a real difficulty in and sub-national level, including the executive developing precise governance and public management Government, the Ministries and other Government indicators for this very broad and overarching subject. agencies, the National Assembly, the Supreme Court This was mainly because, if the indicators that are to and other courts and tribunals, Peoples Committees and be applied in this field are to be expressed to cover the Peoples Councils and State organizations at the entire field of governance and public management, the provincial, district and commune level. language in which they are expressed is likely to be quite broad. The SG felt this was nevertheless an Good governance is the process of translating societal important task that should be undertaken. However, in demands into choices, resulting in policy formulation doing so, it recognized there is also a risk that some and implementation. Good governance is epitomized by indicators could be seen as abstract and as lacking the predictable, open and enlightened policy making (that preciseness that enables measurement. For this reason is transparent processes); a bureaucracy imbued with the SG sees these indicators as only a first step. It a professional ethos; an executive arm of government therefore recommends that, after appropriate accountable for its actions; and a strong civil society3 consultation, further work is undertaken to develop from participating in public affairs; and all behaving under the generally-expressed indicators more specific the rule of law.4 As such, there are four main pillars of governance/public management indicators for each good governance: transparency, accountability, sector. participation, and predictability. The existence of each of these factors will promote higher quality public Together with the assistance being provided by the seven management. other sub-groups that were set up by the PTF, the work of the Governance and Public Management SG will be In this paper the linkage between governance/public used to support the Governments development of a management and poverty reduction is explored, before CPRGS. outlining possible governance and public management indicators and the choices made by the SG. The paper Halting and reversing the spread of HIV/Aids by 2015 2The Government will be used in this paper to refer to the national government. References to the government cover all levels of government, both national and local. 3Civil society embraces all members and elements of society outside Government including local communities at village level, to NGOs, to representative organisations and various interest groups, to the private sector etc. 4 World Bank, Governance: The World Banks Experience, 1994 Poverty Task Force: Ensuring Good Governance for Poverty Reduction 1 PART II. GOOD GOVERNANCE AND POVERTY REDUCTION Making the linkage between national strategies for unfavorable policy settings; through inappropriate poverty reduction and improvements in governance and allocationsofpublicresourcesawayfromsociallyuseful public management is essential to the success of the goods such as education; through corruption; or through CPRGS. The empirical research in a number of the inability to enforce their legal rights- the poor are countries establishes that where there is weak often the most adversely affected by poor governance governance this reinforces poverty5: and public management. Unlike people on higher incomes, poor people often lack the power and the · Knack and Keefer establish a linkage in their resources to respond effectively to weak governance.10 research between measures of trust and civic cooperation and economic growth6; Implementation of a range of strategies to reduce · La Portas work establishes a relationship poverty, which includes the improvement of governance between trust and efficiency of the judiciary, as an integral and critical part, is thus required to corruption,bureaucraticquality,taxcompliance overcome the disadvantage suffered by the poor. and civic participation;7 · Kaufman8 found a significant causal The work of donor agencies also suggests that in relationship between the rule of law and pursuing the range of strategies that are needed to income of nations, and also with reduced infant reduce poverty, one main pillar must be improvements mortality and literacy; in governance and public management. By way of · The Voices of the Poor study9 conducted in example, Box 1 describes the three strategic pillar 60 countries in 2000 found that the common approach taken by the Asian Development Bank element that ties the poor together was lack of (ADB)11 . power and voice. Thus, the empirical research, and the development The impact of poor standards of governance in fact experience of a number of donors, suggests that the usually falls most heavily on the poor. Poor people are achievementofanumberofthepovertyreductiontargets generally excluded from the institutions that put in place and the indicators that will be included in the CPRGS plans, policies and rules determinative of their rights which is now being developed, may be compromised and obligations; that make decisions that affect their unless there are improvements to the capability and lives; and which allocate and administer public performance of the Public Sector. A number of the resources to programs affecting them. Whether it is Interim Poverty Reduction Plans (IPRSPs) that have through inefficient service delivery; through been developed in other countries explicitly recognize 5 See D.Narayan, draft Staff Guidance Paper on Empowerment prepared for the World Bank,August 2000; M. Moore, Polity Qualities: How Governance Affects Poverty, Institute of Development Studies, 1999; United Nations Development Program (UNDP), Choices for the Poor- Lessons from National Poverty Strategies, edited by A.Grinspun, 2000 6 S Knack and P.Keefer, Does Social Capital Have an Economic Payoff? A Cross-Country Investigation The Quarterly Journal of Economics, 1997 7 R.La Porta, F.Lopez de Silanes, Aheifer, R Vishny, Trust in Large Organisations, American Economic Review, Vol. 87, No. 2, p. 333 8 D. Kaufmann et al, Governance Matters, World Bank paper, 1999 9 D. Narayan et al, Voices of the Poor: Can Anyone Hear Us? World Bank paper, 2000 10See UK Department for International Development, Making Government Work for Poor People, June 2000; World Bank, Poverty Reduction Strategy Sources Book, Volume 1,Chapter on Governance and Poverty Reduction, 2001- it cites as an example household surveys that indicate that the poor pay a larger share of their income in bribes. 11SeeADB, Fighting Poverty in Asia and the Pacific, The Poverty Reduction Strategy, 1999. As to the element of decentralization, there have been difficulties in implementation of decentralization in many countries flowing in particular from poor design, too ambitious strategies and/ or from capability issues. Decentralization should be pursued carefully and in a phased manner (see pages 13-14 of the Strategy). 2 Poverty Task Force: Ensuring Good Governance for Poverty Reduction GOODGOVERNANCEANDPOVERTYREDUCTION Box 1- ADB Poverty Reduction Strategy 675$7(*,& ,17(59(17,216 3,//$56 6KRUWWHUP 0HGLXPWHUP /RQJWHUP 3ULYDWH 6HFWRU 'HYHORSPHQW 3UR3RRU 5HJLRQDO &RRSHUDWLRQ 6XVWDLQDEOH (FRQRPLF *URZWK $JULFXOWXUH 5XUDO 'HYHORSPHQW (QYLURQPHQW DQG 1DWXUDO 5HVRXUFH 0DQDJHPHQW 7UDQVSRUW &RPPXQLFDWLRQV (QHUJ\ DQG )LQDQFH *RRG *RYHUQDQFH 3XEOLF ([SHQGLWXUH 0DQDJHPHQW DQG $GPLQLVWUDWLRQ 'HFHQWUDOL]DWLRQ 'HYROXWLRQ 6WDNHKROGHUV 3DUWLFLSDWLRQ 6RFLDO 'HYHORSPHQW 6RFLDO 3URWHFWLRQ +HDOWK DQG (GXFDWLRQ :DWHU 6XSSO\ DQG 8UEDQ 'HYHORSPHQW that risk as a very real one12. The Governments IPRSP does not automatically trickle down to benefit the poor. of March 2001 already recognizes that implementing There is a need to empower the poor, by targeting the reform of governance and public administration must structures that create poverty.The quality of governance be one of the key strategies to promote economic growth at the central and local level is often the crucial link to and to create resources for poverty alleviation13. make poverty reduction effective. A conceptual framework developed by the ADB, Good governance for poverty reduction comprises, presented in Figure 1 (next page), shows that poverty among other matters: (i) focussing poverty reduction reduction rests on a foundation of civil and social order, resources and creating accountability in the use of public good governance, and institutional rules, effective funds in the interests of the poor, (ii) building national markets, and pro-poor growth and focused poverty capacities for pro-poor policy formulation and interventions. Weaknesses toward the bottom of this implementation,(iii)improvingadministrationandprivate framework, such as weak governance, hurt the poor in sector participation for better services delivery to the two broad ways: first, they weaken the effectiveness poor, (iv) shifting decision making nearer to the poor of markets, and thus hold down economic growth. and helping the poor to organise themselves, (v) Cross-national research has shown that growth in the preventing corruption as it affects the poor most, (vi) overall economy is on average accompanied by the same strengthening the rule of law with clearly pro-poor growth in the income of the poor14. Without strong enforcement procedures, and (vii) involving, in a growth, there is little chance of reducing poverty; and participatory way, a diversified range of stakeholders second, weak governance hurts the poor through non- including NGOs representing the poor15. However, economic channels. Growth and human development where some of these elements of good governance are 12These can be accessed on the World Bank website (http: //www.worldbank.org) 13See page 21 of the Interim Poverty Reduction Strategy of the Government of Vietnam 14Dollar, D. and Kraay, A. 2000. Growth Is Good for the Poor, Washington: World Bank, 15See the ADB, Fighting Poverty in Asia and the Pacific: The Poverty Reduction Strategy of the Asian Development Bank, 19 October 1999, R179-99 Poverty Task Force: Ensuring Good Governance for Poverty Reduction 3 GOODGOVERNANCEANDPOVERTYREDUCTION not present and there are difficulties in governance such it is the critical foundation for long-term sustainable as through lack of information, high transaction costs socio-economic development for the nation. It is andweakenforcementofrules,thisislikelytobebecause essential therefore to note that the Governments the institutional environment is weak. 16 poverty reduction programs as well as community participation approaches in its targeted poverty and Thus, the most effective manner in which the infrastructure programs among others, such as Governmentcanplayitsroleinfacilitatinggreatersocio- Programs 133 on Hunger Eradication and Poverty economic development and bringing prosperity is by Reduction, and Program 135 on Support to Especially seeking ways of enhancing an increase in productivity, Poor Communes, will have a far greater impact if they efficiency and effectiveness. Good governance not only are addressed and implemented in a broader context of promotes a sound development management system but good governance. Figure 1: Linkages in Poverty Reduction Poverty Reduction Pro-poor Growth Poverty Intervention Pro-poor Investment Effective Markets Contract and Institutional Rules and Regulations Good Governance Civil And Social Order 16S. Nachuk, Key Issues Regarding Asian Development Bank Technical Assistance on Institutional Strengthening for the Central Region Poverty Reduction in Vietnam, a paper prepared for DFID and ADB, July 2001 4 Poverty Task Force: Ensuring Good Governance for Poverty Reduction PART III- SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT A. Improved Governance is not an End in It may be that these reforms will be very efficiently itself but a Means to an End carried out and that they do in fact have very laudable objectives of helping the situation of the poor. But the In monitoring the progress achieved in the future in real question to be measured should always be, not making the improvements needed in governance and whether the reform was implemented, but whether it public sector management in order to reduce poverty, it eventually made any difference to the poor in terms would have been relatively straightforward for the SG of any impact made on their lives. to recommend indicators based just on whether a reform has been implemented. This would involve treating the The SG has therefore tried to focus on what are the reform as an end in itself. However, it seems that some governance indicators that might be best used to of the problems in progressing particular public determine what are the outcome on poor peoples lives. management reforms in Vietnam have been due to focusing on process as an indication of progress rather As the Governments PAR Master Program itself than focusing more on ensuring that there are outcomes recognizes: attributable to the governance reform that ensure the poor are in fact better off. The SG did not want to apply PAR is meant to move towards delivering this practice. services to people in a better and more effective manner; it is not meant to bring benefits to The SG, therefore, has avoided suggesting governance/ administrative agencies (on their own) public management indicators to the PTF that were merely the implementation of a reform such as Indicators should therefore be practical and results- restructuring in a Ministry or the introduction of some oriented rather than being concerned overly with the innovation in service delivery. reform process itself or being technocratic in nature. Box 2. Linkages between Poverty Reduction and Governance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· )URP (FRQRPLF 6KRFNV 6DIHJXDUGV IRU HFRQRPLF YXOQHUDELOLW\ · )URP &RUUXSWLRQ (QIRUFHPHQW PHFKDQLVPV &ULPH DQG 9LROHQFH (IILFLHQW FRXUWV ZLWK FRPSHWHQW MXGLFLDU\ DQG OHJDO SHUVRQQHO Poverty Task Force: Ensuring Good Governance for Poverty Reduction 5 SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT To give one example of an outcomes-approach, namely · Predictability- refers to the rule of law and that which is taken by the World Bank, the Bank results primarily from laws and regulations and identifies four key outcomes of its poverty framework budgets that are clear, known in advance and that good governance can help to achieve. These are uniformly and effectively enforced.18 through: If these four principles are complied with, government · Empoweringthepoor,inparticularbyimproving is also likely to be efficient in the use of resources and transparency and by improving the poors also more effective in the sense of better achieving participation in governance17; desired program outcomes. Thus, in applying these · Improving coverage, efficiency and principles: effectiveness and sustainability of basic services; · Accountability, can be promoted through mechanisms for requiring that responses be · Improving the access of the poor to markets made in respect of institutional conduct, and so that they can improve their standard of through appropriate incentives, good living; supervision, and high levels of citizen · Providing security from economic shocks and participation; from corruption, crime and violence. · Transparency, can be promoted by regular publicationanddisseminationofinformation,as B. Applying Four Principles of Good Governance well as through enhanced feedback loops to Poverty Reduction among citizens, officials, and policy-makers; Having regard to international best practice, the SG · Participation, can be promoted through decided to apply four good governance principles to mechanisms that enable citizens to be more examining possible outcome indicators to be used to involved in the conduct of government, test the actual progress being made in the reduction of particularly through the implementation of poverty. These are: appropriate decentralization policies; and · Accountability- the obligation placed on · Predictability, can be promoted through government institutions and officials to give consistent application of rules and policies. answers and explanations and to take responsibility for the impact of their actions on Applying these principles impinges very directly on the citizens-thisprovidestheopportunityforcitizens issue of what are the outcomes that are being achieved to have a voice and to participate in the affairs for the poor. They concern what is being achieved in of Government; empowerment of the poor in the sense of increasing their ability to contribute to government; to avail · Transparency- this entails the free flow of low themselves of government services; to take advantage cost information that is understandable, reliable of economic and social opportunities that are available and timely; to them; and to do so in an environment in which their security is protected and their rights can be enforced. · Participation- this refers to the opportunities available to citizens to participate in the affairs C. A Brief Overview of Governance Indicators of government through mechanisms that give them a voice and influence in policy-making As outlined earlier in this paper, in recent years, and program delivery; researchers have demonstrated strong links between 17For a recent discussion of empowerment issues see also Part III of the World Development Report, 2000-2001 18SeeADB, PromotingGoodGovernance:ADBs Medium TermAgendaandActionPlan, October 2000;ADB, Governance:Sound Development Management, 17 August 1995 6 Poverty Task Force: Ensuring Good Governance for Poverty Reduction SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT good governance and higher levels of socio-economic the following criteria have been used for development development. However, until recently, most cross- of governance indicators in Vietnam: country measures of governance were too broad to be of specific use to policy-makers. For example, measures 1. Is the indicator relevant for helping address like, the capacity of the State are interesting to measure, concerns regarding governance addressed but findings are too general to lead to specific policy in the other sectoral papers? This implies changes. that high level governance indicators may be less relevant for this exercise than indicators Frustration with this lack of specificity has led to further that address issues surrounding access to and research being pursued regarding the development of quality of basic services. second generation indicators. These indicators are morespecific,andprovideinformationthatismoreuseful 2. Do the indicators measure key issues for policy application. For example, instead of rule of addressed both in this paper and in the law, a second generation indicator might be, percent Vietnam 2010 report? of citizen respondents who submitted a dispute to the court system reporting that the dispute was resolved There are many different frameworks that one quickly and at reasonable cost. could use for addressing governance concerns. For reasons of consistency and coherence, the While still being piloted around the world, in one recent following two parameters will be used in the paper (Knack, Kugler, and Manning, 2001), the authors matrix that the SG has developed. The first attempt to develop a group of second-generation parameter is the vision of good governance, as indicators for cross-country use. The authors include a summarized by the five key governance issues variety of criteria for development of these indicators, outlinedintheVietnam2010report(seeChapter including the Indicator implicates specific institutional 7). The second parameter is the four pillars of arrangements; lends itself to valid and reliable good governance that have been discussed in quantitative measurement; time series or cross-country this paper. data exists for the indicator; and there is an independent association between the indicator and pro-poor The five key messages outlined in the outcomes. Vietnam 2010 report 19 are: A stronger, more efficient public service which is capable While these criteria may be appropriate for drawing of implementing policy and delivering better conclusions based upon large data sets, the governance services to the people at all levels; better and indicators below have been selected according to more transparent public financial somewhat different criteria. Developing and using management; wider access to justice and the governance indicators in the one country creates the same rules applying to all; more participative possibilityofprovidinghighquality,reliableinformation and responsive government, particularly at that can be used by Vietnamese policy-makers. local levels; and a government which fights corruption and waste at all levels. The four principles of good governance as D. Choosing the Indicators outlined earlier in this paper are: accountability; transparency; participation; and predictability. Indicators will be used to monitor progress regarding good governance/public management As noted above, 3. While being comprehensive, are the there is no standard set of governance indicators used indicators specific enough to be meaningful worldwide. To ensure that indicators are specific and for the future policy process? The purpose relevant,inadditiontotheissuessetoutinPartIVabove, of this exercise is to gather information that 19Vietnam 2010, Entering the 21st Century, Vietnam Development Report, Pillars for Development, December 2000 Poverty Task Force: Ensuring Good Governance for Poverty Reduction 7 SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT can be used by policymakers; if the information is suitable only for research papers, for Improving service delivery is one priority under the PAR example, then the indicators will not have Master Program. Provision of information supports achieved their purpose. transparency in government in Vietnam. Having access to information assists the poor to seek services; to take 4. Are the indicators measurable? Specifically, advantage of opportunities available under government is there (a) enough information available, or programs; to exercise their legal rights; to pursue potentially available? and (b) a small enough economic opportunities available in the market; and to number of indicators to enable easy and hold the government accountable. Information, whether frequent data collection? There is always a providedinawritten,oralorsomeotherform,isessential tradeoff in developing governance indicators to the poor being in a position to take action to improve between generating useful information and the their situation. Lack of information about program rules high cost and difficulty of collection. For this and benefits leaves poor people vulnerable to corrupt exercise, a group of core indicators are practices.20 proposed. To gather information, improved and more systematic data gathering tools are Often the information is theoretically available to those proposed. who are seeking it but there are barriers to accessing it by reason of remoteness of location, the bureaucratic 5. Are the indicators relevant for policy-makers language used in the explanations provided, the and appropriate in the Vietnamese context? complexity of the administrative process such as the Not all indicators are relevant for this exercise. forms to be filled in, or the ethnic language of the person For example, indicators regarding national seeking the information. All of these barriers need to security are probably not necessary to gather, be addressed and resolved in ensuring that information as Vietnam has internal peace, and there is no is readily available. imminent threat to national security from external powers, as Vietnam is at peace with Under the PAR Master Program, service delivery is to its neighbors. be decentralized and administrative procedures and formssimplified.Thesereformsshouldassisttoimprove E. Possible Governance/Public Management the flow of information to the poor, provided that Outcome Indicators attention is also given to improving information about the quality of service performance. These are outlined in Table 1 next page. 2. Extent of access of the poor to basic The indicators marked in bold in Table 1 are those government services such as health, education, recommended by the SG for further consideration by infrastructure, water and power at the local the PTF. In making these recommendations the SG level. focused on three factors in particular: access to information, participation in government, and Poor people lack the resources to satisfy the bare responsiveness of government. It also has endeavored necessities of life. Pro-poor strategies needs to to align the indicators with the current reform initiatives involve increasing the effectiveness of government of the Government. so that it enables the poor to develop their own capability; to improve their income; and to move out F. Recommended Indicators of poverty. Where government provides access to a range of basic services such as health, education, 1. Level of Information publicly available to civil infrastructure, water and power, this significantly society regarding services, policies and planning enhances the ability of poor people to improve their arrangements at all levels. economic and social well being. 20Voices of the Poor, Chapter 3 on State Institutions, World Bank, 2000 8 Poverty Task Force: Ensuring Good Governance for Poverty Reduction SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT Table 1. 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The level and form of basic services that are needed by the poor in a particular province needs further 4. Extent to which, at the national level, the level discussion at the sectoral level and specific indicators of expenditure that is being targeted to pro-poor then need to be devised. purposes is predictable from year to year. Recent research conducted in Vietnam also suggests Improving the situation of the poor is not assisted where that there is a relationship between lack of access to expenditure of significant sources of government funds health and education and low human capital and that goes to economic, social or other programs that should poverty is becoming concentrated amongst people with be a lower priority than pro-poor programs. Often this low human capital which is in turn linked to lack of in turn reflects weaknesses in the current policy settings ability to access education and health services.21 In of government as well as underlying problems with the particular, their ability to access services is being policy formulation process that also need to be adversely affected by cost and by location of some addressed. services at localities that are remote from the poor. The PER recommended in its 2000 report that the Better-targeted interventions are needed from Government should give more attention to the extent to government so as to ensure the availability of basic which funds were being directed to pro-poor services and to avoid the poor remaining so, regardless expenditure. It referred in particular to education and of the economic growth that is now occurring around health. them in Vietnam. A related issue is the extent to which expenditure on 3. Level of budget transparency regarding pro-poor programs is being properly targeted to its provincial and local taxation, budgeting, and intended recipients. The recent report on the Human spending patterns in each sector. Capital of the Poor suggests that spending in some sub- sectors of education and health disproportionately Budget transparency is critical to the poors benefits the non-poor. In respect of health, for example, understanding of how money is being spent and to the report found that government subsidies, in some sub- ensuring that it is properly targeted on pro-poor sectors have been regressive and have been programs. It is also critical to ensuring accountability. disproportionately captured by the non-poor. It While the transparency of the national Budget has recommended that policy-makers needed to rationalize improved since 1997, the PER22 recommended further resourceallocationsoastoimproveequityandefficiency transparency reforms should be made and these are of expenditure. planned under PAR. In particular, there is a need for further disaggregation of expenditure at the provincial The proposed indicator draws on proposed reforms to and sectoral level so as to establish the flow of budget public financial management to introduce medium term funding to the poor more precisely. budgetary arrangements. These reforms should provide greater certainty about the level of expenditure from Transparency at the local government level is very year to year on pro-poor programs. uneven, both in respect of revenue-raising and expenditure, and needs significant improvement. For 5. Extent to which the decisions and verdicts of example, the extent of compliance by communes with courts and tribunals are publicly available. the Decree 23 requirement to post their budgets outside commune offices appears to be low. Lack of Much of the literature concerning the linkages between transparency hinders the poor from pursuing governance and poverty reduction points to the 21 ADB, Human Capital of the Poor, 2001 22 Joint Report of the Government of Vietnam- Donor Working Group on Public Expenditure Review, Managing Public Resources Better, 2000 10 Poverty Task Force: Ensuring Good Governance for Poverty Reduction SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT importance of a country having a legal system that not being well suited to the person situation and the supports rather than hurts the poor. The effectiveness question then becomes to what extent can government of the rule of law has a profound impact on the conduct be flexible and adaptable to the situation. In either case, of economic and social relations and on the security of the poor are often not well equipped to access the right person and property. agency, to put their concern clearly, and to seek a better and more appropriate response from the Government. Making available the decisions of courts and tribunals would be one effective way of ensuring there is greater The PAR Master Program acknowledges the extent of transparency in the legal system. This would in turn the current problems with service delivery across enable greater scrutiny and accountability within the government. However, the likelihood in the near future legal system. Thisindicatorisconsistentwiththethinking of a significant level of decentralization of responsibility oftheMinistryofJusticeonthedirectionsoflegalreform. down to the local government level could accentuate current shortcomings in service unless there is increased The SG did consider recommending an indicator which responsiveness. PAR also promises simplified is that is concerned with the way that all institutions of bureaucratic processes to overcome red tape and the government applied the law in its dealings with the reduce the transaction costs. Participation of the poor poor. This indicator would have been intended to in design and implementation of these reforms could encompass both the executive, the legislative, the assist in ensuring that these reforms are properly framed administrative and the judicial function at all levels of so as to improve responsiveness and the interaction of government. the poor with government. The evolution to a State based on the operation of the Improvements in responsiveness will require rule of law is underway. For its success one basic improvements in institutional capacity and changes in feature must be that all government agencies behave the current attitude and performance of many public as bound by the law. As the Governments PAR Master servants. The poor have most to gain from such changes Plan states, there must be: as by reason of their powerlessness they are often the most disadvantaged by the weaknesses in service effective measures to curb acts which violate delivery. democracy freedom and indulge in arbitrariness, red tape, corruption, harassment 7. Extent to which the Grass Roots Democracy for bribes and trouble-making people. It is Decree has been implemented in each commune importanttostrengthenadministrativediscipline so as to improve opportunities for public and individual accountability, to equally and participation severely discipline those cadres and civil servants who commit violations.23 The Grass Roots Democracy Decree (Decree 29 of 1998) is particularly concerned with improving peoples 6. Extent to which local government is responsive participation in decision-making on local planning, in to, and follows up on, problems in service delivery, major construction works, budget and related matters, that are raised with it by the poor. as well as establishing mechanisms of accountability and transparency. Much of the reform that is underway in governance around the world is concerned with how can government Participation in local government gives the poor the bemademoreresponsivetocivilsocietyandparticularly opportunity to discuss and to influence economic in relation to service delivery. Sometimes it is a problem development, commune policies, budgets, plans, of service quality either related to timeliness, to programs, building infrastructure and service delivery administrative error or to difficulties in access. arrangements in ways that are more suited to their needs Sometimes it is a problem of the service that is provided and circumstances. For example, many communes have 23PAR Master Plan at page 11 Poverty Task Force: Ensuring Good Governance for Poverty Reduction 11 SELECTING INDICATORS IN GOVERNANCE/ PUBLIC MANAGEMENT extensively discussed how to develop new job of cases. However, the complicated and unclear opportunities and in their planning have then tried to administrative process, low rates of remuneration, send people to other areas where they can learn new excessive regulation, the opaque nature of decision- jobskills. making, lack of public information, bureaucratic discretion on the part of middle level officials, and long While implementation of the Decree has been underway delays, all contribute to corruption. across Vietnam for some years, progress achieved to date varies from commune to commune. GCOP rates The poor are disproportionately affected by corruption about 40% of communes as giving a very good because it increases the costs of utilizing the performance in implementing the Decree. In around administrative system for them and can deprive them 17% of communes implementation has not gone much of a higher percentage of their income than others who beyond formality. The full implementation of Decree live in more fortunate circumstances. 29 has considerable potential to empower the poor. While the Government introduced an ordinance against 8. Extent to which laws combating corruption are corruption in 1998, and related legislation, if they are to effective be a disincentive to corruption, they must create an environment where corruption is effectively addressed The Government has in recent years confirmed a number and sanctioned. Therefore, the enforcement of those of times its commitment to stamp out corruption, while laws must be determined and strong. It is important acknowledging that corruption continues to be a major that the emphasis is not just on dealing with corruption problem. Firm sanctions have been applied in a number that has occurred but should also be more oriented to preventing corruption from occurring at all. 12 Poverty Task Force: Ensuring Good Governance for Poverty Reduction PART IV- BASELINE AND TRENDS: IMPROVING GOVERNANCE AND PUBLIC MANAGEMENT SO AS TO SUPPORT POVERTY REDUCTION A. The Experience in Reform of Governance/ been established24. Remaining policy gaps are Public Management In Vietnam now likely to be addressed following development of the CPRGS. In Vietnam the early part of the process of reform (Doi Moi) focused on building the foundations for the · ServiceDelivery-Capabilitybuildingbothatthe introduction of a socialist-oriented market economy. grassroots and national level has had some Much of the early focus was on economic development. limited impact on improving service delivery This led to a period of rapid economic growth, up to such as through the reduction of bureaucratic 1997, and to a remarkable reduction in the overall level processes and the creation of one stop shops. of poverty in Vietnam. The economic changes that But the scale of service delivery problems were made also had considerable implications for the remains large at all levels. role of the State as it sought to put in place the necessary · Rule of Law- Many laws have been passed macro-economic and policy settings, the institutional althoughthebasicframeworkisstillincomplete; arrangements and the regulatory framework. However, programs have been launched to disseminate recent progress has been slow, and much remains to be legal information to the public; legal institutions done by way of further developing the private sector; have been strengthened; legal education has instituting the rule of law; improving the performance been improved; the number of lawyers has of the public sector; and re-orienting and restructuring increased; and legal aid is now available in the State owned enterprise (SOEs) sector. nearly all provinces; · Honest and Accountable Government- A In reviewing the reforms to governance the SG number of laws prohibiting corruption have recognizes that there has been progress in a number of been passed and in some instances this has been areas affecting the poor, over the last 20 years: followed up, either through inspectorates and · Political level- The National Assembly (NA) in the courts, in enforcement action. Modest continues to strengthen its capability to increases have been made to the salaries of scrutinize the performance of Government. public servants as part of the governments The Grassroots Democracy Decree which systemic approach to countering corruption seeks to strengthen the opportunities for the participation of the masses was passed in 1998. The PublicAdministration Reform (PAR) was launched Some donors and NGOs have since conducted in 1995. PAR implementation has led to date to a number projects aimed at strengthening stakeholder of changes such as the passage of new laws and participation in governance. ordinances; review and adjustment of legal regulatory · Macro-economic stability- The economy is documentation; streamlining of a number of relatively stable; foreign investment rules have administrative procedures; improvements in personnel been made more flexible, new markets for tea, management through a new law which has established rice etc have been opened up; access to land a system of ranks and grades covering all public for agricultural purposes has been improved; employees; reduction of the number of governmental the Enterprise Law has expanded the agencies, especially the number of Ministries. opportunities for operation of the private sector; Improvements in transparency in Budget information the opportunities for private sector growth are have also been achieved through the publication of a still constrained in some areas and the national budget but there is still room for greater continuation of some inefficient and subsidized transparency in revenue collection and in the level of State Owned Enterprises has an impact on expenditure data provided, particularly at the local level. government expenditure. By contrast with the slower pace of change in · Policy framework supporting the poor- a governance, Vietnam has under Doi Moi demonstrated number of specific Government programs have a capacity to put in place decisively far-reaching 24Program 133 on Hunger Eradication and Program 135 on Support to Especially Poor Communes Poverty Task Force: Ensuring Good Governance for Poverty Reduction 13 BASELINE AND TRENDS: IMPROVING GOVERNANCE AND PUBLIC MANAGEMENT SO AS TO SUPPORT POVERTY REDUCTION economic changes to cope with changing circumstances. Thus, when you review the actual impact of governance One such example is the Governments decision in 1998 and public management reforms on the daily lives of to disband agricultural co-operatives and turn land over people at the rural level, while there has been some to the farmers to farm themselves leading to Vietnam change,itisperhapsunsurprisingtofindthatitisdifficult moving from being a rice importer to one of the to discern many lasting and practical improvements. For worlds biggest exporters. This experience suggests example, in many rural areas what makes people that the conditions needed for reform in Vietnam continue to be poor is their limited access to health care, include: education, water, sanitation, roads and transportation. · Strong Government ownership of the change B. Recent Developments in Good Governance in and consensus on the action needed; Vietnam · A sense of crisis that needed decisive resolution; Part of the difficulty in achieving a higher rate of change in governance and public administration that will confer · A strong interest on the part of central and local benefits on the poor has been the lack of an agreed public servants in implementing the reform; visiononwhatmustbeachieved,untilrelativelyrecently. · Active feedback and assistance from citizens Now, the declared vision of the Government, based on regarding the need for and implementation of official statements contained in the 10-Year SEDS for the reform; and 2001-2010 and the next 5-Year Plan, is for a country that has efficient Government institutions at all levels, · Immediate and recognizable results. is governed by the rule of law, and ensures a fair, equitable society for all Vietnamese citizens, whilst However, when the success factors listed above are ensuring national security and being compatible with examined against the actual experience in implementing the needs of a more market-oriented economy as governance reform it may go some way to explaining well as uplifting the standard of living, particularly the relatively modest level of change achieved so far in the poor governance and public management reform. In pursuing these outcomes, there are a number of As the recent report of the Central Committee to the reform streams in the field of governance and public 9th National Congress of the Communist Party of management that are underway. They include: Vietnam stated: · The PAR Review, and now the PAR Master Administrative reform has been slow and Program, which has recently been approved irresolute, and results meagre. The State by the Government; apparatus has been organizationally · cumbersome, with overlapping functions, The joint Government Public Expenditure numerous intermediaries and harassing Review (PER) which was released in mid 2000; administrative procedures; with not a few cases · The joint Government/donor Legal Needs of disharmonious actions between higher and Analysis (LNA) that is currently being lower levels, and central and local authorities, undertaken as a basis for development of a hindering socio-economic development and comprehensive plan for the legal sector, under reducing development motives. Certain the leadership of the Ministry of Justice (MOJ). individuals, due to personal or local interests, have been reluctant to step up administrative The PAR Master Program identifies seven programs reforms and reform of the State organization covering four main areas of reform. The four areas and apparatus. Not a small number of public are: (i) institutional reform based on building a legal officials and employees have been substandard and institutional framework; (ii) reform of the both in ethics and integrity, and in job organizational structures of public administration; (iii) qualifications, professional capacities and building the contingent of cadres and public servants; vocational skills. and (iv) public finance reform. 14 Poverty Task Force: Ensuring Good Governance for Poverty Reduction BASELINE AND TRENDS: IMPROVING GOVERNANCE AND PUBLIC MANAGEMENT SO AS TO SUPPORT POVERTY REDUCTION Many of the Governments PAR strategies, when they · Improvingthecapacityandmotivationofpublic are implemented, should have an impact on the poor. servants through better training, and an These include: improved incentive system, should assist in improving the capability of organizations · The redesign of the overall machinery of the involved in policy formulation and service Government could affect what organizations delivery affecting the poor; are in future involved in serving the interests of the poor; · Decentralization of functions to the provincial level could provide greater empowerment to · The proposed development of new legal the poor both to be involved in decisions that institutions could enhance the ability of the poor affect their daily lives and to hold local officials to enforce their rights; accountable for their performance. · The development of new laws relating to the institutionsofGovernmentisintendedtoreduce Similarly the PER recommended changes to budget and arbitrarybehaviorbydelimitingthelegalpowers financial management including greater transparency they have over the poor; to revenue raising and to budget allocations and enhancing the pro-poor bias of public spending. · The reduction of red tape by development of new simplified and transparent administrative The LNA is covering issues affecting the poor such as procedures will affect the way in which the improving transparency of legal information systems; poor will access Government services; improved the capability of legal institutions to enforce · Better defining mandates and functions of the law; improving the law-making process and the institutions, and restructuring those with a consultation process on draft laws; strengthening legal service delivery role, could enable institutions education; and improving access to legal aid. to better focus on serving the poor; Poverty Task Force: Ensuring Good Governance for Poverty Reduction 15 PART V- KEY FACTORS TO ACHIEVE GOALS AND RELATED POLICIES Improving the livelihood of the poor depends in part on opportunity and security, should be considered. The implementing reforms to governance and public man- three factors might be explained as: agement that improve the performance of public insti- tutions on issues that affect the poor. If the required · Empowerment means the extent to which the improvements to governance and public management Government provides information about its ob- are to be implemented in a way that actually benefits jectives, policies and plans and provides the the poor the Government needs to put in place the nec- opportunity to the poor to influence them in pro- essary policy and institutional arrangements for that poor ways. It also means the extent to which purpose.As outlined in Part IV, the Governments PAR Government seeks to assist the poor to develop Master Program has recently been finalized. The LNA the capabilities required to better their lives, will not lead to a definitive plan for the legal sector be- whether that it is through provision of educa- fore 2002. The political will that is apparent in the de- tion, health, infrastructure, social or other ser- velopment of these visions for improved governance vices. now needs to be converted into strong support for imple- mentation. · Opportunity is concerned with the extent to which Government is creating the environment, Implementing the reforms to governance and public through the legal and regulatory framework, for management under the PAR Master Program will be the poor to gain access to markets so as to extremely challenging. Effective leadership and coor- improve their income and living standards. This dination from the central agencies such as the Govern- includesensuringtherearelowtransactioncosts ment Committee of Organization and Personnel and that factors preventing access to the mar- (GCOP) and the Office of the Government (OOG) is ket are addressed through policy settings. essential. The implementation of reform will be a long- term process and this will require meticulous planning, · Security is concerned with ensuring that land, considerable guidance in implementation and careful property and personal rights are protected; that sequencing of action. Capability is a major constraint the rules regulating economic and social activ- andimprovementswillprobablyoccuronlyslowly.Some ity are reliably enforced (eg. access to credit); resistance to change can be expected. For reform to that access to basic Government services is succeed, the Public Service needs to develop a higher guaranteed; and that there is a social safety level of ownership and commitment to reform and to net to protect the economically vulnerable. play an active supportive role in implementing the changes. The next important factor in evaluating the reform of governance is concerned with the degree of stake- However, on the other hand, there are risks, if the re- holder support for making governance/public manage- forms are not successful that the poor will be worse ment more pro-poor through the implementation of the off. For example, as demonstrated in some other coun- reforms earlier described in this paper. tries, decentralization measures, if not well designed and carefully managed in implementation, will be counter- The World Bank has suggested four key questions in productive in their impact on the poor25. These risks gauging support for governance reform. These are: suggest that the reform process needs to be managed are there champions for reform; is there a long-term pragmatically and flexibly depending on the different vision for fundamental change; is there dedication to local contexts. creating a knowledge society; and is there engagement with civil society?26 If these conditions are not met the In assessing the relevance of governance/public man- chances of success in implementing reform are de- agement reforms to the poor, the impact on the lives creased. In applying this learning to the situation of of the poor in terms of three factors: empowerment, Vietnam, the SG believes it is best to be cautious about 25World Bank, Poverty Reduction Strategy Source Book, 2001, at Volume I, Chapter on Governance and Poverty Reduction at page 15 26World Bank, Assessing Aid, 1998 16 Poverty Task Force: Ensuring Good Governance for Poverty Reduction KEYFACTORSTOACHIEVE GOALSAND RELATED POLICIES the prospects for immediate improvements through re- However, skills need to be enhanced not just in manag- form unless the stakeholder support for implementation ing and delivering programs that serve the poor but also is apparent. Building stakeholder support requires in- in the formulation of the relevant policies and programs. formation dissemination, consultation and involvement Without these skills being enhanced, the achievement of stakeholders in the reform process. of some of the sectoral indicators that will be included in the CPRGS could be compromised. Another important factor is concerned with the institu- tional capacity for pro-poor reform implementation. The level of skills development required at all levels This is an issue at all levels in government, but the most through training and other learning is very large. But immediate impact for the poor may be if local govern- this first requires that the capability of training institu- ment does not develop the capability to serve the poor tions themselves be enhanced. PAR requires that the better. While it depends on the particular province, the Public Servants who are serving the poor take on new capability of local government in many areas of Viet- and quite different attitudes and behaviors to perfor- nam is still quite weak. mance in their jobs such as seeing the poor as clients with rights and entitlements to be provided with ser- There are many examples of reform programs that have vices to the requisite standards. failed around the world because the necessary institu- tional or individual capability did not exist and was not The approach taken for example by the United created. Kingdoms Department of International Development (DFID) to supporting the development of pro-poor gov- Governance and public management reform in Viet- ernance focuses particularly on the development of the nam has some major capability hurdles to be surmounted capabilities that it believes are needed by the State to in implementation. For example UNDPs evaluation of be able to meet the IDTs. It has identified seven such its poverty projects in seven provinces in Vietnam in capabilities28. These are set out in Box 3 below. 1998 showed the need for greater capacity-building in local government and village organizations.27 Box 3- Capability Framework used by the United Kingdom Department of International Development in Addressing Poverty Issues Related To Governance The Department of International Development (DFID) in the United Kingdom has developed a framework of seven capabilities that Government needs to develop, in partnership with the private sector and civil society, in order to meet the IDTs: · To operate political systems which provide opportunities for all people, including the poor and disadvantaged, to influence government policy and practice; · To provide macro-economic stability and to facilitate private sector investment and trade to so as to promote the growth necessary to reduce poverty; · To develop a policy framework which can meet the poverty eradication targets and to raise, allocate and account for resources in accordance with these pro-poor policies; · To guarantee the equitable and universal provision of effective basic services; · To ensure personal safety and security with access to justice for all; · To manage national security accountably and to resolve differences between communities before they develop into violent conflicts; and · To develop honest and accountable government that can combat corruption. 27See UNDP Poverty Report 2000, Chapter 6 on Pro-Poor Local Governance: the Neglected Reforms 28DFID. Strategies For Achieving the International Development Targets: Making Government Work for Poor People, June 2000 Poverty Task Force: Ensuring Good Governance for Poverty Reduction 17 KEYFACTORSTOACHIEVE GOALSAND RELATED POLICIES There are also likely in some circumstances to be a government, poor feedback loops to civil society, number of potential constraints to reform inadequate incentive systems, corrupt practices, uneven implementation. As M. Grindle 29 has pointed out, the enforcement of laws and decrees and a failure to apply poorest countries are often in the weakest position to sanctions for inadequate or improper bureaucratic make the necessary governance reforms to support performance. poverty reduction because the reforms required can be quite overwhelming in dimension and scope and may Indeed the very fact of the conduct of a long-term also all seem to have a similar degree of urgency. exercise of reform implementation, if it is not well managed, could become a constraint. The Government Thus, reforming of governance can produce is now engaged in developing more detailed action comprehensive and multi-faceted lists of reform that programsthatwillneedtoprovidearealisticpathforward are quite difficult to come to terms with. for implementing changes in governance and public management. In promoting reform to support reduction of poverty, it is important to be realistic about what the constraints The relative availability of resources will also be are likely to be, without wishing to be seen in any sense some constraint on the pace with which reform can as critical of the aspirations that lie behind reform. proceed. The resource costs of making the changes to governance and public management are difficult to In Vietnam the constraints that are likely to be faced quantify but could be significant. GCOP and others include inadequate resources, unclear organizational are currently assessing through the resource mandates, the quality of leadership at particular levels, implications of the PAR Master Program. weaknesses in coordination between different levels of 29See paper by M. Grindle, The PSRP Process: What Next? April 2001 18 Poverty Task Force: Ensuring Good Governance for Poverty Reduction PART VI- MONITORING A. Developing Process Indicators 1. One quantitative method that can be measured using existing systems. There are two steps in ensuring that indicators are monitored accurately. First, the indicators must be clear 2. One qualitative method that will require sys- and mutually comparable among different regions of tematic client surveys of selected citizens and Vietnam. civil servants. Second, where data gathering systems are currently Table 2 below sets out the proposed framework for insufficient, new systems must be created (as has been measuring the eight outcome indicators recommended proposed by the World Bank). For each indicator, two in Table 1. data gathering methods are proposed: Table 2: Proposed Governance/Public Management Monitoring Framework 2XWFRPH ,QGLFDWRU IURP 7DEOH 3URFHVV ,QGLFDWRU /HYHO RI LQIRUPDWLRQ DYDLODEOH WR FLYLO RI FRPPXQHV SURYLGLQJ LQIRUPDWLRQ VKHHWV RQ VRFLHW\ UHJDUGLQJ VHUYLFHV SROLFLHV DQG VHUYLFHV HWF SODQQLQJ DUUDQJHPHQWV &OLHQW VXUYH\ RI FLWL]HQV UHJDUGLQJ ORFDO DZDUHQHVV RI VHUYLFHV HWF ([WHQW RI DFFHVV RI WKH SRRU WR EDVLF RI SRRU ZLWK DFFHVV WR SDUWLFXODU EDVLF VHUYLFH LQ JRYHUQPHQW VHUYLFHV VXFK DV KHDOWK HDFK SURYLQFH HGXFDWLRQ LQIUDVWUXFWXUH ZDWHU DQG SRZHU &OLHQW VXUYH\ RI DYDLODELOLW\ RI SDUWLFXODU VHUYLFHV DW SURYLQFLDO OHYHO /HYHO RI EXGJHW WUDQVSDUHQF\ UHJDUGLQJ ,QIRUPDWLRQ SXEOLVKHG LQ WKH 1DWLRQDO %XGJHW FHQWUDO SURYLQFLDO DQG ORFDO WD[DWLRQ HQDEOHV LGHQWLILFDWLRQ RI H[SHQGLWXUHUHYHQXH E\ EXGJHWLQJ DQG VSHQGLQJ SDWWHUQV IRU HDFK VHFWRU DQG SURYLQFH VHFWRU 3HUFHQWDJH RI EXGJHWV WKDW DUH SXEOLVKHG DQG DYDLODEOH DW SURYLQFLDO GLVWULFW DQG FRPPXQH OHYHO ([WHQW WR ZKLFK H[SHQGLWXUH LV SURSRRU DQG RI H[SHQGLWXUH RI 1DWLRQDO %XGJHW LGHQWLILHG DV LV LQFXUUHG LQ DFFRUGDQFH ZLWK EXGJHW SURSRRU DOORFDWLRQV DQG SODQV $XGLWUHYLHZ RI H[SHQGLWXUH LQGLFDWHV WKDW EXGJHW ZDV LQ IDFW VSHQW RQ WKH SRRU 7KH ODZ LV DSSOLHG E\ DOO LQVWLWXWLRQV IDLUO\ 7KH LQFUHDVHG LQGHSHQGHQFH RI OHJDO LQVWLWXWLRQV LV DQG SUHGLFWDEO\ LQFOXGLQJ LQ WKH UHVROXWLRQ SURYLGHG IRU E\ WKH ODZ RI DGPLQLVWUDWLYH GLVSXWHV &LWL]HQV VXUYH\V UHJDUGLQJ SHUFHSWLRQV RI WKH DSSOLFDWLRQ RI WKH UXOH RI ODZ E\ JRYHUQPHQW ,PSDFW RI LPSOHPHQWDWLRQ RI WKH *UDVVURRWV 3HUFHQWDJH RI FRPPXQHV WKDW SURYLGH 'HPRFUDF\ 'HFUHH RQ LQYROYHPHQW RI FLYLO DUUDQJHPHQWV IRU ORFDO SDUWLFLSDWLRQ LQ ORFDO VRFLHW\ LQ ORFDO JRYHUQPHQW JRYHUQPHQW &LWL]HQV VXUYH\ RI SHUFHSWLRQV RI WKH OHYHO RI LQYROYHPHQW RI FLYLO VRFLHW\ LQ ORFDO JRYHUQPHQW ([WHQW WR ZKLFK ODZV IRU FRPEDWLQJ (IIHFWLYHQHVV RI PHFKDQLVPV SURYLGHG E\ ODZ ODZV FRUUXSWLRQ DUH HIIHFWLYH 5HVXOWV RI FOLHQW VXUYH\V RQ SHUFHSWLRQV RI HIIHFWLYHQHVV RI ODZV Poverty Task Force: Ensuring Good Governance for Poverty Reduction 19 MONITORING One key finding from experience of the joint As to quantitative data, the Government Statistic Office Government-Donor working group that researched and would need to consider playing a role. wrote Attacking Poverty two years ago was that exclusive reliance upon either qualitative or quantitative As to the use of citizens surveys, this could be data gathering methods resulted in incomplete findings. conducted by government or by independent groups. Quantitative data provided robust information that could One such approach is the use of citizens scorecards beeasilycomparedamongdifferentlocalitiesinVietnam, as piloted by the Public Affairs Centre in Bangalore. while qualitative data (based upon four participatory There are also examples of projects that have utilized poverty assessments) provided deeper insights into participatory approaches involving the poor to monitor specific issues than information from close-ended project involving public sector reform, judicial reform quantitative questionnaires could. and financial management reform 20 Poverty Task Force: Ensuring Good Governance for Poverty Reduction PART VII- NEXT STEPS Because governance has not, to date, been future use. Much of the quantitative systematically addressed by a joint Donor-GOV team, information can be captured through the use of there is much to do to ensure that indicators are the existing GOV data, though some monitored accurately, information is properly disaggregation will have to be done to promote summarized and analyzed, and findings are fed into the greater understanding of the impact of policy process. governance upon different socio-economic and/ or regional groups in the country. The following steps should be taken to ensure that this process is more than a paper exercise, and feeds into 4. Based upon discussions between GOV and the Vietnamese policymaking system. donors, develop specific modalities for gathering both quantitative and qualitative 1. Based upon comments, finalize indicators information. Resource staff time and funds. presented in this paper, at Part III. In It is foreseen that qualitative and quantitative coming months, a number of stakeholders in information will have to be gathered in a the government and the donor community will different manner. Much of the quantitative reviewtheindicatorslistedabove.Whileasmall information can be gathered from existing GOV number of government agencies have been records, though some information may not be involved in the SGs work, there is in particular available at the central level. The qualitative a need to develop stronger government information will likely have to be gathered in a ownership of the indicators that are finally stand-alone survey process, or in combination decidedon.Finalizationofindicatorswillrequire with qualitative information from other sectoral a more inclusive process during which many surveys. It is expected that this can be finalized stakeholders offer their opinions regarding the in the first quarter of 2002. appropriateness and measurability of the draft indicators listed above. Drawing on this work, 5. Field test qualitative questionnaires, and It will also be necessary to develop more revise based upon initial findings. It is precise indicators that relate to specific sectors. anticipated that there will be some difficulties in gathering reliable, mutually comparable 2. Identify clear monitoring responsibilities for information from respondents throughout the carrying out, analyzing, and finalizing country. An initial field test may be needed in indicators. There must be a lead government the first quarter of 2002. agency, and individual within this agency, who will take primary responsibility for monitoring 6. Insert the governance questionnaires as one indicators in the future. Similarly, one donor of Government Statistics Offices rotating agency (or a coalition of agencies) must take modules of questions for periodic use in responsibility for liaising with the GOVagency, the future. and providing technical and financial support, as appropriate and necessary. Oncetheindicatorsarefinalized,andinplace,theyshould provide a basis not just for monitoring the progress made 3. Write specific quantitative and qualitative in addressing poverty, but also serve as a good measure questionnaires for used in future monitoring. of the success of the governance and public management After indicators are finalized, draft reform process. They should also provide a more than questionnaires will need to be developed for useful input to the future policy development process. Poverty Task Force: Ensuring Good Governance for Poverty Reduction 21 BIBLIOGRAPHY Asian Development Bank, Fighting Poverty inAsia and D.Narayan, draft Staff Guidance Paper on the Pacific: The Poverty Reduction Strategy, November EmpowermentpreparedfortheWorldBank,August2000; 1999 D. Narayan et al, Voices of the Poor: Can Anyone Asian Development Bank, Human Capital of the Poor, Hear Us? World Bank paper, 2000 June 2001 United Nations Country Team (Vietnam), IDT/MDG DFID (United Kingdom Department for International Progress, July 2001 Development),StrategiesforAchievingtheInternational Development targets, Making Government Work for United Nations Development Program, Consultants Poor People, June 2000 Report on Implementation of the Grass Roots Democracy Decree, July 1999 Government of Vietnam, Third Draft of the Strategy for Public Administration Reform, March 2001 United Nations Development Program, UNDP Poverty Report 2000 M.Grindle, The PSRP Process: What Next?, April 2001 (Paper prepared for DFID) United Nations Development Program, Choices for the Poor, Lessons from the National Poverty Joint Report of the Government of Vietnam- Donor Strategies, 2000 Working Group on Public Expenditure Review, Managing Public Resources Better, 2000 Vietnam 2010, Entering the 21st Century, Vietnam Development Report 2001: Pillars of Development D. Kaufmann et al, Governance Matters, World Bank paper, 1999 Vietnam 2010, Entering the 21st Century, Vietnam Development Report 2001: Partnerships for S Knack and P.Keefer, Does Social Capital Have an Development Economic Payoff? A Cross-Country Investigation The Quarterly Journal of Economics, 1997 World Bank, Governance: The World Bank Experience, 1994 M.Moore, Polity Qualities: How Governance affects Poverty, Institute of Development, 1999 World Bank, Poverty Reduction Strategy Sources Book, 2000 S.Nachuk, Key Issues Regarding Asian Development Bank Technical Assistance on Institutional World Bank, World Development Report, 2001/2001 Strengthening for the Central Region Poverty Reduction in Vietnam, a paper prepared for DFID and World Bank, Vietnam: Assessment of the Interim ADB, July 2001 Poverty Reduction Strategy Paper, March 2001 22 Poverty Task Force: Ensuring Good Governance for Poverty Reduction Millennium Development Goals (MDGs) Goals and Targets Indicators Goal 1: Eradicate poverty and hunger Target 1: Halve, between 1990 and 2015, the proportion 1. Proportion of population below $1 per day of people whose income is less than one dollar 2. Poverty gap ratio [incidence x depth of poverty] a day 3. Share of poorest quintile in national consumption Target 2: Halve, between 1990 and 2015, the proportion 4. Prevalence of underweight children (under-five years of age) of people who suffer from hunger 5. Proportion of population below minimum level of dietary energy consumption Goal 2: Achieve universal primary education Target 3: Ensure that, by 2015, children everywhere, 6. Net enrolment ratio in primary education boys and girls alike, will be able to complete a 7. Proportion of pupils starting grade 1 who reach grade 5 full course of primary schooling 8. Literacy rate of 15-24 year olds Goal 3: Reach gender equality and empower women Target 4: Eliminate gender disparity in primary and 9. Ratio of girls to boys in primary, secondary and tertiary secondary education preferably by 2005 and to education all levels of education no later than 2015 10. Ratio of literate females to males of 15-24 year olds 11. Share of women in wage employment in the non-agricultural sector 12. Proportion of seats held by women in national parliament Goal 4: Reduce child mortality Target 5: Reduce by two-thirds, between 1990 and 2015, 13. Under-five mortality rate the under-five mortality rate 14. Infant mortality rate 15. Proportion of 1 year old children immunised against measles Goal 5: Improve maternal health Target 6: Reduce by three-quarters, between 1990 and 16. Maternal mortality ratio 2015, the maternal mortality ratio 17. Proportion of births attended by skilled health personnel Goal 6: Combat HIV/AIDS, malaria and other diseases Target 7: Have halted by 2015, and begun to reverse, the 18. HIV prevalence among 15-24 year old pregnant women spread of HIV/AIDS 19. Contraceptive prevalence rate 20. Number of children orphaned by HIV/AIDS Target 8: Have halted by 2015, and begun to reverse, the 21. Prevalence and death rates associated with malaria incidence of malaria and other major diseases 22. Proportion of population in malaria risk areas using effective malaria prevention and treatment measures 23. Prevalence and death rates associated with tuberculosis 24. Proportion of TB cases detected and cured under DOTS (Directly Observed Treatment Short Course) Goal 7: Ensure environmental sustainability Target 9: Integrate the principles of sustainable 25. Proportion of land area covered by forest development into country policies and 26. Land area protected to maintain biodiversity programmes and reverse the loss of environmental resources 27. GDP per unit of energy use (as proxy for energy efficiency) 28. Carbon dioxide emissions (per capita) Target 10: Halve, by 2015, the proportion of people 29. Proportion of population with sustainable access to improved without sustainable access to safe drinking water sources water Target 11: By 2020, to have achieved a significant 30. Proportion of people with access to basic sanitation improvement in the lives of at least 100 million 31. Proportion of people with access to secure tenure slum dwellers. [Urban/rural disaggregation of several of the above indicators will be relevant for monitoring improvement in the lives of slum dwellers] Vietnam Development Goals* (VDGs) Vietnam Development Goals directly based on the MDGs Goal 1: Reduce the percentage of poor and hungry households Target 1: Reduce by 40% the proportion of people living below the international poverty line between 2001 and 2010 Target 2: Reduce by 75% the number of people living under the international food poverty line by 2010 Goal 2: Universalize education and improve education quality Target 1: Increase net enrolment in primary school to 97% by 2005 and to 99% by 2010 Target 2: Increase net enrolment rate in junior secondary school to 80% by 2005 and 90% by 2010 Target 3: Eliminate the gender gap in primary and secondary education by 2005, and the gap with ethnic minorities by 2010 Target 4: Increase literacy to 95% of under-40-year-old women by 2005 and 100% by 2010 Target 5: By 2010 have improved the quality of education and increase full-day schooling at primary level (exact target depends on funding) Goal 3: Ensure gender equality and women empowerment Target 1: Increase the number of women in elective bodies at all levels Target 2: Increase the participation of women in agencies and sectors [includes ministries, central agencies and enterprises] at all levels by 3-5% in the next 10 years Target 3: Ensure that the names of both husband and wife appears on the land-use right certificates by 2005 Target 4: Reduce the vulnerability of women to domestic violence Goal 4: Reduce child mortality, child malnutrition and reduce the birth rate Target 1: Reduce the infant mortality rate to 30 per 1000 live births by 2005 and 25 by 2010 and at a more rapid rate in disadvantaged regions (see below) Target 2: Reduce the under-5 mortality rate to 36 per 1000 live births by 2005 and 32 by 2010 Target 3: Reduce under five malnutrition to 25% by 2005 and 20% by 2010 Goal 5: Improve maternal health Target 1: Reduce the maternal mortality rate to 80 per 100,000 live births by 2005 and 70 by 2010 with particular attention to disadvantaged areas Goal 6: Reduce HIV/AIDS infection and eradicate other major diseases Target 1: Slow the increase in the spread of HIV/AIDs by 2005 and halve the rate of increase by 2010 Goal 7: Ensure environmental sustainability Target 1: Extend forest cover to 43% by 2010 (from 33% in 1999) Target 2: Ensure that 60% of the rural population has access to clean and safe water by 2005 and 85% by 2010. This should be the case for 80% of urban people by 2005. Target 3: Ensure there are no slums and temporary houses in all towns and cities by 2010 Target 4: Ensure that all waste-water in towns and cities is treated by 2010 Target 5: Ensure that all solid waste is collected and disposed of safely in all towns and cities by 2010 Target 6: Air and water pollution must attain national standards by 2005 Vietnam Development Goals and Targets not directly based on MDGs Goal 8: Reducing vulnerability Target 1: By 2005, increase the average income of the lowest expenditure quintile to 140% of that in 2000 and to 190% of that by 2010 Target 2: Reduce by half the rate of poor people falling back into poverty due to natural disasters and other risks by 2010 Goal 9: Improving governance for poverty reduction Target 1: Effectively implement grass-roots democracy Target 2: Ensure budget transparency Target 3: Implement legal reform agenda Goal 10: Reducing ethnic inequality Target 1: Preserve and develop the reading and writing ability of ethnic languages Target 2: Ensure entitlement of individual and collective land-use rights in ethnic minority and mountainous areas Target 3: Increase the proportion of ethnic minority people in authority bodies at various levels Goal 11: Ensuring pro-poor infrastructure development Target 1: Provide basic infrastructure to 80% of poor communes by 2005 and 100% by 2010 Target 2: Expand the national transmission grid to 900 poor commune centres by 2005 *Note: This is a summary of a fuller set of VDGs outlined in the CPRGS. The VDG papers have more targets and indicators. Source: Govt of Vietnam (2002). Comprehensive Poverty Reduction & Growth Strategy.