Public administration wage increases vs. The motivation to be corrupt
The government is implementing new measures to link its workers’ compensation to compliance to tackle corruption with a clear focus: no company or person is above the law.
This refreshed approach aims to prevent corrupt relationships primarily with businesses, before they happen, aiming to transfer responsibility directly to the individual. Through effective compliance programs and solid anti-corruption governance, senior leaders of institutions must prevent bad practices and, in cases of corruption, detect, sanction and report to the relevant anti-corruption unit.
In this context, still far from the expectations of the fight against corruption through strengthening the performance and quality of public services, in 2023 the Prime Minister also presented the increase in public sector salaries, as a strong financial support for the motivation of human resources and against corruption. The financial measure with a high cost for budget expenditures aim to reduce the relative benefit of corruption and increase the relative cost of most punishments.
However, this solution in all that we described above can be both costly and politically unpopular.
An alternative and potentially more cost-effective solution that we suggest based on the good experiences of several partner countries with Albania includes the implementation of the payment of salaries depending on performance and not in a uniform manner and without deeply analyzing the existing and new issues.
Paying employees based on performance has become a widely used tool to improve productivity and reduce costs in the public sector.
This, at least, was the hope and expectation even in the case when the reform in public administration began to be built mainly on this basic principle.
The logic that applies is that if salary increases were conditioned on the quality of public employees’ performance, they could serve as a substitute for money obtained through corruption, allowing bureaucrats to maintain (or even increase) their incomes without engaging in corrupt acts. In this sense, performance pay can be considered a “legal bribe”, effective regardless of whether the corruption is motivated by necessity or greed.
From the many references to studies conducted, despite some apparent successes as well as some apparent failures, the results have generally been inconclusive. The reason is that if pay for performance is not carefully designed and supported by a long-term objective by a strong political will, then pay schemes do not seem to have the potential to make civil service units more productive and cost-effective[1].
Another reason can be found in the dilemma of who and how those who control the performance themselves are controlled.
In order to update the idea of payment based on performance, we have conducted an analysis based on surveys conducted with citizens in several municipalities of the country, regarding the citizen’s perception of the political decision to increase salaries and the impact on the local administration.
We have received feedback that tipping (corruption) depends on low wages. But it does not decrease if political or nepotistic employments are made, as well as if performance evaluation is
not done responsibly based on the criteria of the civil servant law. Meanwhile, we also received as feedback that the influence of political patronage or dependence of the local administration on extra-legal forms, tipping decreases if the salary increase increases to higher levels than the indexation[2]. This feedback of the citizens is valid in the case of the high salary increase for the central institutions, but not in the case of the local administration, where the salary increase is smaller[3].
So, the characteristics and specifics of the implementation of a certain reform are important for its effectiveness, if equality in the treatment of employees is not equal. This inequality in the treatment of local public employees less than the central ones creates a compromising situation for the reform. If the local administration will not feel fulfilled by this measure, this will only further hinder their productivity and the quality of the administration and distancing themselves from the lure of tips.
These arguments hold, as pay for performance should only motivate employees to the extent that performance and rewards are (perceived to be) actually correlated, where pay and bonus increases should be based only on honest performance appraisals and not on differentiation according to levels of government. However, accurate and unbiased performance measurement and evaluations are difficult. If there will be no self-cleansing actions from the patron-Nazi model after the wage increase, this reform is in potential danger of being fulfilled, or will continue to be carried out in vain.
In such contexts, pay for performance can be used to reward covert behavior, encouraging rather than reducing corruption. In contrast to the capture of the state by private interests, the capture of incentive programs with reward policies for corrupt public servants undermines the public service performance of those who have taken responsibility to fight corruption (Hellman et al., 2003).
From the analysis of the performance of public institutions in fulfilling the governing program, but also the annual programs of the institutions, it is observed that by using competitive elections to select an individual in relation to the party in power, we identify the presence of a significant political favoritism in public employment, where being a political supporter of the ruling party increases the chance of having a job in the public sector.
This favoritism is great at all levels of the hierarchy of institutions, but it is more disturbing at the top levels of the hierarchy, which in recent years have been caught in the act of corrupt acts, as an indicator of the lack of control, as well as the effect of patronage.
Patronage is the decisive mechanism behind favoritism in public employment, leading to the selection of less qualified public employees, which is evidenced by the lack of fulfillment of institutional objectives[4], but also in their performance[5].
Assuming a constant ratio of employment in the public sector in relation to the total population, starting from the predictive statistics for the future of the country, it is necessary to have a master plan precisely for the employment ratios for each sector so that the distribution of resources and the incentive for recruitment meritocratic to be harmonized with the bill. salary budget as a long-term offer in the labor market, where the offer of young men and women for this labor market should be valued more than all other offers.
This connection should harmonize the labor market of the public sector, firstly with the universities of the country, and secondly with the entire labor market outside the borders of the country.
In conclusion, although the approaches above provide evidence-based arguments on how digital government can potentially contribute to reducing corruption, this whole mechanism is not expected to have a significant impact on curbing corruption. Digitization can be seen in the context of citizens’ access to technology, the level of developing skills to use technology and its actual use will increase during any digital government initiative, as it is vital to serve as a transparency and anti-corruption tool. But at the same time, this mechanism does not mean success as the administration and the country still face many different social challenges, which are reflections of actions and interactions between different groups within the Albanian people.
The achievement of reforming the public administration and social life in the country cannot change even after the decision to increase the salaries of the public administration, without first implementing all the tasks that are described in the relations for measuring performance based on meritocracy and distancing from political patronage of administration.
The country has already taken important steps in implementing anti-corruption measures in many corruption response plans. But what is still missing is the commitment based on the open government program and a transformation of the mindset for inclusion, connection and communication with all sectors and layers of society.
There are other relevant non-state actors, such as: the media, civil society and businesses that need to be involved in the fight against corruption, directly or indirectly acting as monitors for tracking all actions taken by the government to not react after corrupt actions have taken place.
[1] https://www.mfa.gov.tr/making-performance-pay-more-successful-in-public-sector.tr.mfa
[2] Public sector wage increases with an average of over 30%
[3] The wage increase for the local administration is 5,000 ALL/month gross or 60,000 ALL gross per year
Leave a Reply
You must be logged in to post a comment.