report. 2 index current system reform of spanish public administration (cora) new strategy

THE BETTER REGULATION STRATEGY

IN THE SPANISH ADMINISTRATION REFORM

REPORT

2

THE BETTER REGULATION STRATEGY IN SPAIN

INDEX

CURRENT SYSTEM

REFORM OF SPANISH PUBLIC ADMINISTRATION (CORA)

NEW STRATEGY

3


One-off measures 41.8bn€ have been injected in the economy, paying over 8,000,000 invoices to 230,000

suppliers, through the Fund for the Financing of Payments to Suppliers (FFPP).

Liquidity injection of almost 40bn€ for regional and local administrations, through the Regional Liquidity Mechanism (FLA).

Structural measures Plan to eradicate Late Payments in the public sector: A new legislation has been passed to

ensure monitoring and compliance with legal payment period to suppliers.

• Public Sector Commercial Debt Control Act: Inclusion of the commercial debt in the principle of financial sustainability and guarantee of compliance with the maximum payment period.

• E-Invoicing and New Accounts Register Act: Guarantee of expenses control and protection of suppliers in their commercial relations with the public administrations.

The average payment period of current expenditure operations for Central Administration goods and services has been reduced, in the fourth quarter of 2013, to 30 days.

1. Framework for approval of general legislation.

The regulatory governance cycle begins with the drafting of the rule.

There is no general explicit legal requirement to consult on legislative proposals (primary laws).

The Law mandates public hearings for secondary legislation “once the draft is produced”.

Regulatory impact assessment (RIA):

Guidelines on RIA were approved in 2009 promoting a more integrated approach.

The General Directorate of Administrative Modernization (Secretary of State of Public

Administration, SEAP) coordinates and verifies the content of the RIA (“ticking-box

control”).

The ministry elevates the draft regulation to the General Commission of State Secretariats

and Deputy Secretariats, which carries out a strict scrutiny of legislative initiatives.

The Council of Ministers approves the draft Law and requires the mandatory reports (i.a. Council

of State), before passing the Draft Law and sending the proposed regulation to the Parliament.

CURRENT SYSTEM: FLOW OF REGULATION

4


One-off measures 41.8bn€ have been injected in the economy, paying over 8,000,000 invoices to 230,000

suppliers, through the Fund for the Financing of Payments to Suppliers (FFPP).

Liquidity injection of almost 40bn€ for regional and local administrations, through the Regional Liquidity Mechanism (FLA).

Structural measures Plan to eradicate Late Payments in the public sector: A new legislation has been passed to


• Public Sector Commercial Debt Control Act: Inclusion of the commercial debt in the principle of financial sustainability and guarantee of compliance with the maximum payment period.

• E-Invoicing and New Accounts Register Act: Guarantee of expenses control and protection of suppliers in their commercial relations with the public administrations.

The average payment period of current expenditure operations for Central Administration goods and services has been reduced, in the fourth quarter of 2013, to 30 days.

2. Administrative simplification and burden reduction:

In May 2007 the Government committed to reduce administrative burdens on businesses by

30% by 2012 (estimated savings of €15bn).

Establishment of a Simplified Method for Measuring Administrative Burdens, based on the

European Standard Cost Model.

The General Directorate of Administrative Modernization (SEAP) is in charge of leading this

policy, encouraging departments to reduce administrative costs. It offers technical and

technological support to the departments.

Since 2008 seven Council of Ministers Agreements on Administrative burdens reduction

containing 346 concrete measures have been approved. The goal of 30% reduction in 2012

have been achieved, estimated savings of €18bn have been accounted for citizens and

businesses.

CURRENT SYSTEM: STOCK OF REGULATION

5

Public hearings take place too late and there is less scope to influence policy

outcome (and consider alternatives to regulatory instruments).

Lack of monitoring of compliance of the measures and the results obtained.

There is no unit in charge of challenging the RIA, which faces just a “ticking-box

control”.

Guidelines on RIA do not provide any orientation on data collection or

assessment methodologies.

Administrative simplification effort varies between different ministries. Initiative

comes from each single department as there is no compulsory systematic routine.


CURRENT SYSTEM: SHORTCOMINGS AND IMPROVEMENTS

NEW MEASURES NEW STRATEGYCORA

6

Participants:

CORA Commission: Representatives of every ministry organised in plenary sessions and 4 Working Groups.

CORA Council: Ombudsman, trade unions, employers’ association, consumers representatives, Chamber of Commerce, Consulting Firms’ association.

Citizen’s participation box: 2,239 suggestions.

International Advice:

Organisation for Economic Cooperation and Development (OECD). Public Governance.

Contacts with several Member States and analysis of EC best practices.

Multinational companies’ best practices.

2 international Workshops on Public management and Administration reform.

Sub-Commission on Administrative simplification:

Proposals were collected in a standard format (purpose, legislation to be amended, implementation calendar, estimated savings,…).

903 public proposals were analysed by the Working Group, 400 proposals were accepted and 42 projects selected to be implemented in the short and medium term.


THE CORA REPORT: REFORM OF SPANISH PUBLIC ADMINISTRATION

7


THE CORA REPORT: AREAS OF ACTION

Budgetary discipline, restructuration of public

sector

Public transparency at all levels of government

Public sector rationalisation Effectiveness and efficiency

of government

Administration at the service of citizens and businesses

8

One-off measures

Fund for the Financing of Payments to Suppliers (FFPP): 41.8bn€, paying over 8,000,000

invoices to 230,000 suppliers.

Regional Liquidity Mechanism (FLA): 40bn€ for regional and local administrations.

Structural measures

Plan to eradicate Late Payments in the public sector: A new legislation has been passed to


Public Sector Commercial Debt Control Act.

E-Invoicing and New Accounts Register Act.

The average payment period of current expenditure operations for Central Administration

goods and services has been reduced, in the fourth quarter of 2013, to 25 days.

1. Fight against late payment in the public sector.


THE CORA REPORT: HORIZONTAL MEASURES

9

2. Market Unity Principle and Regulatory Simplification

Market Unity Guarantee Act: Tackles the fragmentation of the domestic market emerging from

differences and overlapping of central, regional and local regulation.

Objective: Ensure that any product or service produced under a regional legislation can be

traded throughout the country, based on the single license and home country principles.

Measures: Rationalizing the regulatory framework on economic activities, eliminating

duplicities and simplifying. It also reinforces coordination among competent authorities and

introduces a mechanism to rapidly solve operator’s problems.

Market Unity Legislative Rationalisation Plan: Identification phase of Central and Regional

legislation has been completed with 2,700 regulations.

Estimated Impact: A 35% reduction in the administrative burden associated with company

creation. An increase of 1.52% of GDP in the long run (over the next 10 years).


THE CORA REPORT: HORIZONTAL MEASURES (II)

10

Codification of the scattered regulations: A Bill to enable the Government to draft eight

consolidated texts is currently under consideration by Parliament.

Common-commencement-dates: A restricted number of dates will be established on which

domestic laws affecting businesses will come into force.

One in-one out rule: Each administrative burden introduced would at least be offset with the

elimination of another burden of equivalent cost.

Guide to detecting and avoiding duplications: Identify the main types of inefficiencies and

duplications and the mechanisms to avoid them.

Burden reduction manual: Advance in the implementation of a system of measuring file-

processing time to estimate the "reasonable" time –different from the “legal” time- to completion of

a procedure.

3. Better Regulation programme.


THE CORA REPORT: HORIZONTAL MEASURES (III)

11

Environmental procedures: Profound modification of the environmental legislation to simplify

and reduce the administrative burdens.

Customs procedures: «One stop» virtual office for foreign trade.

Import procedures can involve 6 different agencies: Customs, Health, Agriculture, Port

Authority…

Reducing the processing and turnaround times, consolidating formats, decreasing paper

documents required and accelerating the clearance of merchandise.

1. Major simplification projects.

2. Enhance e-Government.

Data intermediation platform, to allow citizens’ and businesses’ not to submit documents that are already held by the Administration.

Electronic record of powers of attorney, valid for every procedure and administration.

Single electronic tender portal, in judicial and administrative areas.

Public Sector Contracts Platform: Allows companies to access aggregate information on public contracts.


THE CORA REPORT: SPECIFIC MEASURES

12

3. Simplification of start-up procedures and support of entrepreneurship.

Eliminating municipal licenses for opening retail shops up to 750m2, subject to only a “responsible declaration”.

Streamlining access by entrepreneurs to public procurement:

Facilitate contact between small entrepreneurs that wish to form joint ventures by registering them in the Official Register of Bidders and State Classified Companies.

Increased thresholds for classification requirements in public contracts.

Adaptation of the system of collateral to increase entrepreneurs participation.

Responsible declarations substantiating compliance with conditions for submitting a bid.

Express prohibition on discrimination in favour of previous contractors.

Fight against late payment.

Eliminating the minimum capital requirement to establish a limited responsibility company.

“Entrepreneur in 3 steps”: The electronic platform enables the completion of necessary paperwork with all three tiers of government simultaneously.


THE CORA REPORT: SPECIFIC MEASURES (II)

13

An office for the execution of the administrative reform (OPERA) has been established.

As of May 2014, out of the 222 measures included in CORA’s report:

77 are completed (35%)

145 are in process of execution (65%): 4 are in an initial stage, 61 in a medium stage; and 80 in a final stage of execution


Just 11 months after publishing the CORA report, all measures are underway.

July 2013 Sep. 2013 Nov. 2013 Jan. 2014 Mar. 2014 May 20140

25

50

75

100

125

150

175

200

225

174

8

20

82

3512 7

15

90

114

106

7761

7 15 2851 63 7722

42

50

7480

Not started Initial stage Middle stage Final stage Completed

THE CORA REPORT: DEGREE OF IMPLEMENTATION

14

1. Framework for approval of general legislation.

Better Regulation Unit at the highest level of the Government (Ministry of Presidency):

Consultation: Public hearing starts the legislative process, before drafting the regulation.

Ex-ante evaluation: Before elevating the Draft Law for the first time to the Council of Ministers.

Analysis of draft regulation to ensure quality from the point of view of legislative technique.

Guarantee compliance with horizontal measures to reduce administrative burdens (i.a. SME test, one in-one out, market unity,…).

Ensure the correct completion of the RIA with common systematic measurements of burdens and costs and challenge its quality.

Prevent gold-plating, when transposing EU legislation.

Ensure the consistency with amendments during the Parliamentary procedure.

Ex-post evaluation: The Unit will enforce the evaluation of results by the departments, according to the calendar established in the RIA.


NEW STRATEGY: FLOW OF REGULATION

15

2. Administrative simplification and burden reduction.

The goal is to promote a more comprehensive, systematic and standardized simplification process for the whole Administration.

The process will consist of the coordinated action of two units:

General Directorate of Administrative Modernization (SEAP): Maintains the initiative to propose measures to reduce administrative and regulatory burdens, will elaborate the burden reduction manual and work with the departments to make reform happen.

Better Regulation Unit (Ministry of Presidency):

Promote horizontal simplification projects and ensure compliance with existing ones.

As the unit in charge of reviewing the RIAs, will know, follow and systematically quantify all specific simplification initiatives (coming from the SEAP and other departments).

Encourage compliance with simplification measures by the departments and verify that the responsible departments monitor the outcomes of their policies.

Inform the Council of Ministers on the state of implementation and results.


NEW STRATEGY: STOCK OF REGULATION

16

Spanish Commission for Public Administration Reform:

http://www.seap.minhap.gob.es/es/areas/reforma_aapp.html

Organisation for Economic Cooperation and Development:

http://www.oecd.org/spain/spains-public-sector-reform-plans-on-the-right-track-says-oecd-report.htm

http://www.oecd.org/gov/eNGLISH%20SUMMARY%20WITH%20COVER.pdf

Thank you very much for your attention!

MORE INFORMATION


http://www.seap.minhap.gob.es/es/areas/reforma_aapp.html




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