State Modernization: Dangerous Signs
Julio Francisco Báez Cortés
A legislative agenda has been lacking, local governments are waiting for decentralization, the Comptroller is a besieged institution, and so far there have been no spaces for citizen participation. Evaluating 100 days of the new government implies looking for and interpreting trends, as well as identifying corrective measures for the immediate future. That evaluation should take place without ever forgetting to observe recent history. After the first 100 days of the Liberal government, a preliminary evaluation of the progress in the state modernization process suggests establishing as a take-off point the first babblings on the issue that began at the end of the 1980s and in particular during the six years of the transition government of Violeta Barrios de Chamorro.
It is also appropriate to put on the table three legal-political incidents that took place before the government of Doctor Arnoldo Alemán was inaugurated:
The constitutional reforms of July 4, 1995 set new guidelines for the state and correlations among its governmental bodies. The institutional framework of governability was redefined by new principles particularly applicable to the state reform process.
Apart from the legal aberration of its content, the so-called Framework Law for the Implementation of the Constitutional Reforms was a complementary factor to the constitutional reforms. This law politically expressed a pact between the branches of state with some thirty commitments, some of them closely linked to state modernization.
The legislative crisis of December 1996, sealed by the Supreme Court through Decision No. 1 on January 7, 1997, annulled all legislation passed by the National Assembly in its lame duck period. This gave greater evidence of an inconclusive agenda in terms of state modernization.
A Smaller, More Intelligent StateMy general hypothesis is this: only a joint vision around which all Nicaraguans agree over the short, medium and long haul will make it possible to attempt to reform and modernize the state as an integral process of the nation's social, economic and political life, beyond the narrow administrative or sectoral sphere of the state apparatus.
The development of institutionality-strengthening the rule of law-will thus allow us to imprint history and movement on the well-known constitutional reference to the state's function in Article 98 of the Magna Carta: "...to develop the country materially; to overcome backwardness and inherited dependence; to improve the people's living conditions and to implement an ever more just distribution of wealth." Above all, this will allow us to bring this article up to date.
The state reform that we should put our money on is not a simple change of face, or some kind of organizational shuffle, or a mere quantitative reduction of the state apparatus. It assumes that the intent is more serious. In the words of Tomassini, it means consolidating a "smaller, but more intelligent, better informed, more enterprising and catalytic" state.
No Normative SubstanceWhat legislation has been implemented in the first 100 days of the Liberal government?
A general trend is the "urgency" character attached to bills the President has sent to the National Assembly for approval, meaning that they bypass preliminary legislative commission studies. There is also evidence of the absence of a national legislative agenda.
So far the Alemán administration has issued 254 presidential accords-already the average that the executive office normally issues in 12 months. This rain of resolutions is explained by the fact that we are in the presence of a new government. The majority of these accords have been appointments and removals, with no legal support.
The Presidency of the Republic has also issued 17 Executive Decrees, of which 12 are administrative and 4 have not yet been published.
There have been 9 National Assembly laws, but only 4 have been given legal life. Of the other 5, 4 have not been published and 1 was vetoed by the President. Of the 4 published laws, 3 were unnecessary because they are legislative decrees, one an amnesty law, for example. The fourth was the Migratory Incentive Law, a political response to the President's electoral promise: outside the purview of the tax reform, it was designed "with urgency" to offer incentives to Nicaraguans to repatriate. This is the first tax law to be passed since the constitutional reforms and the first that the National Assembly has been responsible for issuing in 15 years.
Among the bills debated and approved by the new National Assembly, the 1997 Budget Law is transcendental, but it is still not valid because it has not yet been published. For this reason, Nicaragua today finds itself in financial anarchy from the point of view of public finances. To publish a law is not simple ritual; it confers legal life on any disposition and is the final step in the formation of laws.
In conclusion, the legislative leitmotif is the "emergency," both for laws that have been approved and for those being introduced; over 60% of the laws submitted to the National Assembly are termed "of urgent character."
In addition to no national agenda, there's no legislative agenda. In fact, not one of the 93 Assembly representatives has come forward with a legislative proposal aimed at rescuing the focal points of a national agenda.
The Program in ProcessEven though no State Modernization Law exists in Nicaragua as a sort of global legal framework for all reform, nor has the new bill on Organization and Functions of the Executive Branch been approved, the Program to Reform and Modernize the Public Sector, initiated in 1994, deserves special mention. Its field of action is concentrated in the executive branch and its central elements are:
- Development and improvement of the financial-administrative system.
- Integrated financial administration system.
- Strengthening and modernizing collection systems.
- Program to improve and de-bureaucratize the services offered by public institutions.
- Structural institutional reforms.
- Development of a civil service system and administrative career in labor mobility.
- Deconcentration and decentralization program.
- Reforms of public enterprise.
- Technological advances and development.
- Integral public sector training program.
A positive sign observed during the first 100 days of the Liberal government was that this program was transferred from the Finance Ministry to direct management by the Vice Presidency of the Republic. However, the incoherencies and contradictions became apparent immediately; according to Ministerial Accord Number 16, published in La Gaceta No. 61 on April 3, 1997, the Finance Ministry "dictates regulations, with the understanding that the Program still pertains to it." To avoid duplications, the efforts of the team of highly qualified technical and professional specialists must be harmonized with the commitment of the Liberal Alliance, which proposes in the section on state reforms to:
- "Create a law of Administrative Contention.
- Sign an Austerity Pact among the different public administration arms to promote state deregulation.
- Introduce new budget and public spending control instruments.
- Regulate the administrative career.
- Draw up a strategic plan for transparent privatizations accessible to all."
Deconcentration or Decentralization?Decentralization is a basic objective of state reforms, one that implies the irreversible passing of power to local governments. Transferring functions without disconnecting them from a superior hierarchical connection, which could be termed "deconcentration," is not the same thing as transferring decision-making power with full organic autonomy or "decentralization." In practice, there is still no minimally acceptable implementation for decentralization. This is one of the weakest points of this administration in its first 100 days. On page 27 of the Liberal Government Plan, specifically in the section on Commitments to State Reform, it says the following: "The municipalities will be given greater liberties and more responsibilities." In the Commitments to Municipal Autonomy of this same document, it offers "to promote a large municipal financing accord, effective decentralization and fiscal co-responsibility, all combined with corresponding institutional support of the municipalities." As if this were not enough, President Alemán promised in his inauguration speech on January 10, 1997, to create permanent institutions, "with municipal autonomy and economic reinforcement, the cornerstone of democracy and community life, the primary institution closest to the citizen and daily life." He added that "the people want decentralization and state modernization in all its facets."
In practice, however, the Municipal Law has been in legislative debate for some years and has still not been approved. In the proposed Tax Justice Law, none of the measures that will have municipal impact -- reduction of the income tax from 2% to 1%, the land tax, etc. -- were consulted with the authorities of any municipality.
Guarantee of TransparencyWith respect to state transparency, the office of the Comptroller General of the Republic is the body that promotes efficacy and efficiency in public administration and guarantees transparency and responsibility in state management. Its constitutional objective and function go beyond the borders of any particular branch of state.
According to the document "Liberal Alliance Government Commitments," the chapter on plans for a healthy administration explicitly takes on responsibility to "strengthen the actions of the Comptroller General of the Republic." Nonetheless, three destabilizing incidents were observed in Alemán's first 100 days:
The executive reduced the Comptroller General's 1997 budget request for 34 million córdobas to 23.4 million córdobas, plus an additional 4.6 million pending eventual successful passage of the tax reform. It is the lowest budget for a Comptroller General in all of Central America and, in relative terms, is equal to or less than the institution's 1996 budget.
The Liberal bench endeavored to set up an Accounts Tribunal to review the resolutions of the Comptroller. This proposal was an attempt to install a parallel institution that would substitute and castrate the Comptroller General's office. As of today this plan has not moved beyond dangerous intentions.
Issue No. 57 of La Gaceta, March 21, 1997 attempted to give legal validity to Decree 17-97, called "The Creation of a System of Supervision of Public Sector Financial Operations." It is a violent transgression of the Political Constitution in its title VIII, chapter IV, articles 154 to 157, which assigns the Comptroller General the task of being "the directing body of the public administration control system and auditor of state goods and resources." Why does the executive branch insist on "creating" its own comptroller?
Finally, we should add the question that invites large-scale exploration: What about the reforms to the judicial and electoral systems?
And Civil Society?The most important element to consider in the success of an adequate state reform and modernization takes us to the starting point and, at the same time, to the arrival point of this national project: the human resources of public administration and the active presence of civil society. Two sides of the same coin.
In the 100 days of Liberal government, civil service and the administrative career have suffered the thrashings of a "party-based full employment policy," which translates into the massive replacement of public servants and brains with invaluable accumulated experience by inexperienced people to whom the Liberal Alliance has political commitments. This has been a bitter experience that threatens stability and weakens the advances in the professionalization of public service.
On the other hand, civil service in its diverse expression and organizational forms awaits fulfillment of the Liberal offer-to which the President pledged himself in his inaugural speech: "Governing is not the task of just one man, nor of one party nor one Alliance. It is the task of all Nicaraguans. I exhort and invite active participation by the citizenry in their diverse levels and sectors. Civil society has a very important role to play. We want to open a broad space, inviting it as of today to join consulting bodies in each Ministry. Opening a channel of communication through unity at the presidential level will be one of my first initiatives. With similar objectives we will create another body to attend the public: their problems, complaints, requests, suggestions and needs." In the first 100 days we have seen no sign of that respect for and promotion of citizen participation. And at the conclusion of those 100 days, the top-down formulation and failure to consult on the tax bill is a clear demonstration of the self-sufficiency of power, more negative than the worst of taxes. But since there are still five years minus 100 days of Liberal government, we still have time to move forward.