Once upon a time, Yugoslavia stood out among Central and East European states for having retained a professional public service system, contrary to the ‘politbürokratie’ that dominated the ‘Eastern Bloc’. Ten years of heavy politicization in the 1990s undid much of this advantage, creating a hollowed out and politicized public administration on top of a demotivated and disillusioned cadre of teachers, doctors, nurses and other public service professionals.
In the first half of the last decade there was an attempt to modernize the public sector: Serbia adopted new legislation for the core civil service, created the basis for a transparent public sector wage system (with performance elements), and started a (timid) rationalization of core public sector institutions. Alas, the promise of a more effective system, based on merit and performance, didn’t go far enough. Legislative reform stopped with the core civil service and next steps, promised in 2006, to modernize employment conditions for all public sector workers, and introduce merit and performance elements, were not delivered on. The system of performance appraisal, which was designed to motivate better performers and weed out non-performers, has been captured. It became mere toothless formality, which makes it unnecessarily difficult to remove non performing staff and provides little motivations for those that make a real effort to contribute. Finally, employment in public sector institutions increased, without a serious rationale.
When EU membership negotiations start, these issues will be looked at with special interest. The EU has learned the hard lesson of taking in members that were not (administratively) ready and will not want to repeat the mistake. In any case, not being administratively ready is not just a formal issue: it means that countries still have the obligation to pay their dues, but cannot fully benefit from EU funds, thus taking away many of the advantages of membership. It also means the FDI that can flow from membership will be slower to come, and that citizens do not get the services they are entitled to. Lastly, most of all, a non-performing public sector is a costly drag on fiscal resources.
The recent statements by the new Minister of Finance that public sector management needs to be revamped and that Serbia needs to do ‘more with less’ is more than a simple slogan. It is also more than a reaction to fiscal distress. It most of all represents an understanding that Serbia, if it is serious about becoming an economically performing member state of the EU, will need to rapidly pick up where it left off in the middle of the last decade and ‘leap ahead’. This means; rapidly revamping legislation on public sector employment, across the public sector; taking a serious look at staffing levels and functions of government, and make sure that performance, and not complacency, becomes the central principle of public sector management. In doing so, it is important to look beyond the near neighborhood, and consider, for instance, what has been achieved in some (but from all!) the states of Brazil, countries in East Asia and elsewhere, where public sector transformation became a reality, and not yet another disappointment.
