ISSUE 75
October 2005
 
 
   
    Egypt: Civil Service Union Members Approve Contract
Nigeria: 30,000 May Go in Civil Service Reforms
Kenya: Civil Service Should Be Neutral
Ethiopia: Civil Service Reform Programme to Be Introduced into Somali Region
Nigeria: FG Approves Payment of Monetised Benefits to Public Servants
   
    Japan: Japanese Government Aims to Cut 10 Percent of Civil Service Jobs over Five Years
Fiji: More than 20,000 Fiji Public Servants Win Pay Rise
Pakistan: High Courts Can't Interfere in Transfer of Civil Servants: SC
New Zealand: Ideology And Pragmatism In Public Policy
China: 16,000 Cvil Servants Laid Off in 7 Years
   
    Italy: Civil Service: Minister Online All the Time
Malta: Public Service Collective Agreement: 'Family Measures' Introduced
Italy: Civil Service: Toll-free Complaints Number Established
EU Summit: Globalization Fund Need Recognized By EU
Denmark: Public Servant Strike Cripples the Faeroe Islands
   
    USA: Public Policy May Offer Co-term
USA: Good Governance Requires Good Public Service, Senior UN Official Says
Bahamas: Government To Present New Contract Proposal To Public Servants Today
USA: Louis Schimmel: Revolutionary Public Servant
 
   
    South Africa: E Cape's Consultant Civil Service
   
    India: Sebi Clause 49 To Make Corporate Governance More Effective
Japan: Government To Cut Civil Servant Workforce by 10% Over 5 Years
Brunei: Civil Servant Jailed For Raping Daughter
   
    United Kingdom: EU Commissioner Speaks Out on Internet Governance
Scotland A Civil Servant's Lot Is Not a Clear One...
Ireland: Top civil Servant Suggests Private Sector Recruitment
United Kingdom: Top Civil Servant Moves to Bank
Ireland: The View from the ICT Management Board
Italy: Civil Service Minister Online All the Time
Germany: Call for German Schemes to Adopt Governance Code
   
    Israel: Disciplined Civil Servant Gets Bonus
Saudi Arabia: Low-Salaried Civil Servant Rejects SR2 Million Bribe
   
    Venezuela: Expropriations, Cooperatives and Co-management
Cayman Islands: Civil Service Accountability
   
    The Net Is Anarchy: Keep It That Way
Pan-African Forum on Corporate Governance
Good Governance Requires Good Public Service, Senior UN Official Says
Internet Governance Still Burning Issue @ Wsis-05
 
   
    Nigeria: Nigeria Warns 'Corrupt' Governors
Malawi: Malawi President - Impeachment Will Not Stop Anti-Corruption Moves
   
    Japan: Government to Cut civil Servant Workforce by 10% over 5 years
Brunei: Civil Servant Jailed For Raping Daughter
Australia: Boardroom Ethics Aren't for Everyone
China: China Uncovers 240 Bank Corruption Cases in First Half: Report
Taiwan: Regulator Charged with Corruption
Vietnam: NA Deputies Discuss Proposed Law to Prevent, Fight Corruption
Solomon Islands: Solomon Islands Chiefs Welcome New Team Investigating Corruption
China: China Ratifies UN Convention Against Corruption
   
    Ireland: 'Police Corruption' Probe Begins
Scotland: A Civil Servant's Lot Is Not a Clear One
Ireland: Top Civil Servant Suggests Private Sector Recruitment
United Kingdom: Top Civil Servant Moves to Bank
Russia: Khodorkovsky Lawyers Cleared of Ethics Abuse Charges
Russia: Russia Tops UN's Oil-for-Food Corruption Report
France: France Sets Up Ethics Committee for Diplomats
   
    Israel: Disciplined Civil Servant Gets Bonus
Saudi Arabia: Low-Salaried Civil Servant Rejects SR2 Million Bribe
Iran: President Vows to Fight Corruption, Promote Justice
   
    Brazil: Brazil Lawmakers Face Expulsion
USA: House Democrats Propose Ethics Reforms that Shun Sweeping Changes
USA: Executives Talk Ethics to Students
USA: Louisiana Officials Bristle at Washington's Focus on Corruption
USA: Ethics of Stem Cell Research Front and Center
   
    Worst Corruption Offenders Named
 
   
    Nigeria: Osun State Embraces E-government
   
    Knowledge Management Asia 2005
India: Contract Research Industry Unaware of Gains from IT
   
    United Kingdom: Knowledge Management From BSI
Learning@Europe
United Kingdom: Knowledge Economy Series: An introduction
United Kingdom: PART 1. Knowledge Economy: Are We Ready to Capitalise on It?
United Kingdom: PART 2. Q&A: Stephen Aldridge Director Prime Minister's Strategy Unit
Belgium: Sun Powers Belgian E-Government Electronic Identity Card Program
Ireland: State Falls Short in 60% of E-government Projects
United Kingdom: UKvisas Picks Up Top E-government Award
   
    United Arab Emirates: Steering Committee Reviews Progress of e-Government Projects
   
    USA: North Carolina Knowledge Management Organization Formed
   
    Partnership: The New Way Forward for Outsourcing
 
   
    South Africa: Bhisho in R52m Grants Fiasco
Malawi: Probe Finance Minister - House Committee
   
    Vietnam: Vietnam Pledges More Transparency in Public Finance
Vietnam: Vietnam Modernizes Public Financial System
Korea: Fitch Raises Korea's Rating
Vietnam: Experts Praise Nation's Public Finance System
   
    IChech Republic: Finance Ministry Sees Public Finance Gap Below 4.8 Percent of GDP
Bulgaria: Bulgarian Prime Minister: Much Money Are Drained Through Public Finance
United Kingdom: MPs Want Pension Deal Extended to LGPS
Italy: Public Accounts: Tremonti, Selling State Property Not Easy
Hungary: Flying in the Face of EC Reason?
   
    Saudi Arabia: Sharp Rise in Initial Public Offerings in Saudi Arabia
   
    Virgin Islands: Turnbull Bypasses Public Bidding to Speed Woodson Mold Cleanup
Canada: Finance Minister Lashes Out at Bay Street Investment Dealer
 
   
    Tanzania: Public-Private Partnership Strengthens Capacity to Fight HIV/Aids
Nigeria: Nigerian Privatization Agency Concludes 18 Port Cconcessions
Ghana: Private Sector Must Pool Resources
   
    India: Government Plans Setting Up National Fisheries Development Board
India: Public-private Partnership May Suffer
India: Setting Up of Public Private Partnership Appraisal Committee
Pakistan: PM for Public Private Partnership in Rehabilitation Work
Fiji: Partnership Law for Revision
China (Taiwan): Government Needs Clarity on Goals of Financial Reform
Australia: Federal Government Encourages Public and Private Partnerships
Australia: Carr Ddefends Private Sector Jobs
Pakistan: Bush Announces Private-sector Campaign for Quake Aid
Sri Lanka: Sri Lanka Government Shelves Private Sector Funded Oil Refinery Project
   
    Slovenia: Official Says Public-Private Partnership Act Is Crucial
France: France Gives Up Privatization of Nuclear Company Areva
Romania: All 7 CEC Bidders Enter Second Phase of Privatization
Ukraine: Krivorozhstal's Privatization Will Aid Ukraine's Reforms
Armania: Government Encourages Private Sector Investments in Innovation Projects
   
    Bahrain: Growth of Private Sector Top Priority
Qatar: Minister Urges Private Sector to Cash in on Country's Booming Economy
Iran: Private Sector Steps into Iran's Renewable Energy
   
    Canada: Providence Won't Rule Out a Public-private Deal
Venezuela: Private Sector Paying Off Foreign Debt
 

Civil Service Union Members Approve Contract

Nearly 200 of the University's lowest-paid civil service workers will soon see an additional boost in their paychecks, with the help of a $250,000 annual reallocation by the administration. On Wednesday, members of the Association for Civil Service Employees overwhelmingly ratified the union's first revised contract since 2001. The civil service union represents 450 workers at 80 different sites on the Carbondale campus. Union officials said the $250,000 parity pay for these workers is a good first step toward a similar system for all civil service employees. "My priority this year was to help the poorest of the poor ˜ the lowest paid employees among us," Union President Ruth Pommier said. The announcement was greeted by loud applause from those who attended Wednesday's meeting.

The union president, who will retire in June, said the organization used the Northern Study to determine who could receive the parity pay. The study, to which all state public universities report salaries, showed that 197 SIUC employees fell below the state average for civil service workers. Union officials had estimated that $600,000 would be needed to give all represented workers parity pay, but the University could only spare $250,000. Pommier said the additional money was a two-year effort that will give these workers money they deserve as well as the blanket 3-percent salary increase that was given to all represented employees. "No, he didn't willingly give them up," Pommier said of her two-year push with Chancellor Walter Wendler to get the parity pay, "but it was the drip, drip, drip that made him come around."

In a prepared statement, Brent Patton, who worked with the union to negotiate the contract, said the raises and parity pay was something the chancellor has been trying to do for two years with Pommier. Patton and Wendler could not be reached for comment. All increases will be retroactive to July 1, when the contract expired. The current contract is set to end in 2007. "The real issue on this campus is not parity ˜ its compression," said Jim Clark, representative of the Illinois Education Association. Because of that, Clark and union leaders also incorporated a longevity clause into the contract. This will ensure that people who have worked at the University for many years will get due compensation and will help to avoid newer employees being hired at the same rate as those who have served for years.

Also, the new contract includes an additional 20 days for sick time under the Family Leave Act. Clark said this provision was very important because 90 percent of the represented employees were women and many have families and loved ones to care for when they get sick. When the state's budget crisis began in 2001 and it took back 8.25 percent of the University's budget, administrators feared they would have to layoff about 80 employees. In the end, the number was contained to 42, and some of those people were reassigned to other positions on campus. Clear layoff language now exists in the contract, and no one can be laid-off because of a failed evaluation, Pommier said. This language and others were cleaned up to make the new contract much more user-friendly and help people know their rights, Clark said.

Pommier also spoke about the union's historical membership problems. "I hope this collective bargaining agreement gives you an opportunity to re-sell the union," she said. She said the state's budget problems of recent years have been hard on civil service workers, with no salary appropriations set aside for them by the General Assembly. The upcoming gubernatorial elections will be very important, she said. She also encouraged all civil service employees to go to Springfield as much as possible to help lobby for their fellow workers. Pommier said she plans to spend the rest of her term lobbying in Springfield to help save civil service workers' pensions.

From Daily Egyptian , October 26, 2005

30,000 May Go in Civil Service Reforms

Head of Service, Alhaji Ahmed Yayale, said yesterday that the proposed reforms of the Civil Service of the Federation would affect no fewer than 30,056 public servants while the Federal Government would pay a severance package of N25.9bn. Addressing the senate Committee on Establishment and Public Service at the public hearing on the downsizing and rightsizing of the federal public service at the Senate Hearing Room 1, Yayale said, "The exercise has been meticulously designed to ensure that those affected are carefully selected based on the severance criteria already approved by government."

Yayale, who was represented at the event by the Permanent Secretary, Public Service Office, Mrs. Grace Achibong, noted that these criteria are: medically unfit; inefficient unsatisfactory character; voluntary retirement; monetised outsourced abolished cadres; without entry qualification mandatory skills; failed promotion three times; disciplinary cases; and, redundancy. According to him, "the civil service is a very important institution in any country. It is even more so in developing countries, including Nigeria where the rate and impact of national development depends on the strength and resilience of the civil service. "Similarly, appropriateness of government policies and their successful implementation is determined by the efficiency, effectiveness and competence of its civil service.

"The cost effectiveness of the civil service reform can be looked at from two mutually reinforcing perspectives. The first is the financial cost to government in terms of the benefits to be paid to those to be affected by the exercise. The cost has been computed according to the number of those expected to be affected." Itemising those affected as medical cases 457; inefficiency unsatisfactory character 2,102; voluntary retirement 611; monetised outsourced abolished cadres 10,425; without entry qualification mandatory skills 6,168; failed promotion 3 times 646; disciplinary cases 1,645; and, redundancy 8,002 bringing the total of staff to be affected to 30,056.

Yayale said that "it is estimated that about 30,056 workers will be affected in the civil service at a total cost of N25,891,133,927 consisting of terminal benefits and training cost to equip the outgoing workers with skills to enable them establish small scale businesses of their own. He, however, revealed that "the on-going rightsizing of the core Federal Civil Service arose from the approved recommendations in the Interim Report of the Presidential Committee on the Review and Revision of the Public Service Rules, Regulations and Procedures. "It is aimed at shedding redundant and other inappropriate personnel and to inject fresh blood and re-skill of existing staff. A basic policy of government is that staff to be severed shall be given a soft landing by being paid their lawful benefits in full and timely, in addition to some social assistance by way of pre-exit training/counselling," he said.

On the financial requirement he said, "The severance exercise will entail expenditure on the following elements: terminal benefits to the existing staff are based on existing rules and provisions of the Pensions Act; gratuity; pension (budgeted) for one year; 10% of one-year pension;r epatriation allowance - to enable the disengaged officer transport himself and his family to hometown; pre-exit training/counselling - 5% of total severance cost; and administrative cost of the severance - 1% of total cost. "It is also imperative to stress that conscious efforts were made by the Civil Service Reform Implementation Committee to insulate the staff severance exercise against forces of persecution, nepotism and fraudulent manipulations, and to ensure strict compliance with approved criteria.

"In this regard, submissions by Ministries, Departments and Agencies with respect to staff listed to be eased out of the service were carefully reviewed and scrutinised by a number of sub-committees constituted for that purpose. "In carrying out the scrutiny, submissions by MDAs were thoroughly examined, whilst the various establishments were tasked to defend same. It is gratifying to note that the review exercise has added considerable value and credibility to the rightsizing project. "Indeed care has been taken to ensure that those unskilled staff presently undergoing approved courses in recognised higher institutions are spared, in acknowledgement of their courageous efforts to enhanced knowledge and skill," he said.

As Achibong presented Yayale's address, tempers of the representatives of the various cadres of public servants which crowded the Senate Hearing Room 2 flared as they shouted and yelled at the Permanent Secretary particularly when she said that the Federal Service is burdened with excess junior staff and that figures being bandied about concerning the number to be relieved of their services were wrong. But the Nigeria Labour Congress (NLC) President, Comrade Adams Oshiomhole, who also addressed the committee, argued that Achibong is not in a position to answer questions bordering on the proposed purge of the federal workforce, urging the Senate to invite the leadership of the Economic Reform Team. "The sack is meant to satisfy external forces. The Federal Civil Service Commission should have been responsible for deciding what should be, nobody has the answers here.

"The Senate should invite the leadership of the Economic Reform Team. They are responsible for this and simply threw it on the Head of Service to work on," Oshiomhole said. The labour leader also contended that the Head of Service briefing was full of contradictions, noting that President Olusegun Obasanjo has no reason keeping about 50 ministers and several special advisers. "The salaries earned by these people are higher than what they earmarked for the sack. Any reform that does not carry the people along has never worked anywhere in the world," he added. According to him, "NEEDS was meant to create seven million jobs by 2007. Today, NEEDS is halfway through but it has not created 3.5 jobs. The objective of NEEDS has been defeated. "The Senate should ask the executive to stay action indefinitely until the private sector is able to absorb those that will be affected by the downsizing or rightsizing."

Earlier in his welcome address, the Senate Committee chairman, Senator Felix Ibru (PDP, Delta State), said "government has a responsibility to take care of the needs and problems of society and in order to fulfil this obligation, relevant policies are introduced to guide the machinery of delivery. In the long run, some of these policies translate into laws for good governance.

From This Day (Lagos), October 18, 2005

Civil Service Should Be Neutral

The role to be played by civil servants in the coming referendum has arisen pursuant to the assertion by the Minister for Justice and Constitutional Affairs that they shall play an active role due to the fact that the referendum is a government project. Civil servants, like other Kenyans, have a right to take part in any electoral process whether it is the general elections or by- elections for both presidential and parliamentary elections or even a referendum, as the case may be, as the one slated for November 21, 2005 under section 26, 27 28 and 28A of the Constitution of Kenya Review Act cap 3A. In any event as registered voters they have a right to exercise their constitutional right as mandated by section 28 (2) of cap 3A. However, the right of civil servants to take part in the democratic process is not absolute as it is limited. The right is subject to the Laws of Kenya, which limit the extend to which the right may be exercised.

Civil servants, as persons charged with the responsibility of the day to day management and execution of government duties, have to be neutral in the process of electioneering and during the campaign period without openly airing their views on political issues. The requirement for neutrality is pegged on the fact that despite a change of government, the civil service remains intact and guarantees continuity to the citizens of the country to discharge the obligations of the government notwithstanding the political party holding the reigns of the government at any time. The Civil Service does not serve any political party but the public interest. It is accountable to ministers who are accountable to Parliament. There is a delicate balance here between the Government and the party. The Civil Service serves the former never touching on the latter.

Despite the existence of laws in Kenya prohibiting public servants in taking part in active politicking or openly manifesting their support for one party as against the other this has not been successful due to the sheer power the executive has over the civil service. An array of intimidating and arm twisting tactics have been employed by the government to push the Civil Service into submission. This includes hiring and firing of staff at will, promotion not based on merit but on sycophancy and hiring of staff perceived to have a soft spot towards the government in power. The Public Officer Ethics Act No. 4 of 2003 vide section 15 which provides for political neutrality of public officers states that a public officer shall not, in or in connection with the performance of his duties as such: act as an agent for, or so as to further the interest of, a political party; or indicate support for or opposition to any political party or candidate in an election also a public officer is barred from engaging in political activity that may compromise or be seen to compromise the political neutrality of his office.

The constitutional and practical role of the Civil Service is, with integrity, honesty, impartiality and objectivity, to assist the duly constituted Government of Kenya, whatever its political complexion, in formulating its policies, carrying out decisions and in administering public services for which they are responsible. These goals are only achievable if the Service is neutral and protected from the political machinations as the executive is bent on doing the world over. On the same issue of political neutrality, the National Assembly and Presidential Election Act cap 7, through section 17B, similar to the provisions of the Public Officer Ethics Act bars public officers from engaging in activities of political parties and from acting as agents of any party or indicating support or opposition for any party or candidate participating in an election.

However, unlike Act No. 4 of 2003, it is an offence under cap 7 to engage in the prohibited activity and it is punishable by a fine not exceeding Sh50,000 or a term of imprisonment not exceeding six months or both. In light of the provisions of the law highlighted above, it is obvious that public officers cannot take any active part in the process by supporting any side, be it the government side or the opposition. Whatever opinion they may have or decision they are bound to take shall only be known by the ballot on the date set for the referendum exercise to take place. The referendum shall be conducted under the instrumentality of the Constitution of Kenya Review Act cap 3A, which applies cap 7 to the process subject to the laws and regulations as shall be made by the Electoral Commission.

Thus, any direction or fiat from politicians, to openly associate themselves with the banana or orange gravy train, to civil servants is illegal and contrary to the express provisions of the Law. In any event under section 9 of the Public Officer Ethics Act, public officers are required to carry out their duties in accordance with the Law. So if and when such directive is issued public officers are at liberty to ignore it. The turn of events, which the campaigns by the proponents and opponents of the proposed draft has taken, which is invariably a political activity, demands the Civil Service to maintain neutrality from the exercise without manifesting any bias towards any of the groups, but have a right to state their position only at the ballot box on November 21, 2005.

From allafrica.com, October 10, 2005

Civil Service Reform Programme to Be Introduced into Somali Region

The new civil service reform programme will soon be implemented in the Somali Region. Speaking to reporters at his office on Wednesday, the chairman of the Somali Peoples' Democratic Party (SPDP), Ambassador Mohammud Dirir, who is also the Minister of Mines, said in the process of the implementation of the reform documents of the personnel in the various departments of the region will be strictly verified for authencity and posting will be made accordingly.

In the event of lack of qualified persons, the Minister said, qualified candidates will be welcomed from other regions. Speaking about the recent elections in the region, the Minister said the participation of the majority of the people had made the outcome of the election fruitful. He, however, said that three districts out of 51 in the region had decided to exclude themselves from the elections. "We want to have a discussion with them and reach a consensus for we want them to take part in the development programme of the region," he stated.

From Addis Tribune, October 3, 2005

FG Approves Payment of Monetised Benefits to Public Servants

Federal Government has approved the immediate payment of monetisation benefits to workers in all its parastatals and agencies. A circular from the National Income, Salaries and Wages Commission (NISWC) in the presidency dated September 26 and addressed to the affected establishments, said the implementation takes effect from October 1. Signed by E. C. Bosah on behalf of the permanent secretary of the commission, the circular stated that President Olusegun Obasanjo has approved the new rates. A copy of the circular stated that: "The Federal Government has approved the rates for the monetisation of fringe benefits in all federal parastatals and government-owned agencies funded from the federal budget."

``The new rates take effect from October 1, 2005, and affect accommodation, transport, meal subsidy, utility, domestic servant leave grant, medical allowance, furniture allowance and car loan," it added. It, however, said the approval covers only parastatals on harmonised public service salary structure, parastatals on harmonised tertiary institutions salary structure and for university staff salary structure restricted only to the university academic staff." According to the document, entertainment allowance has been cancelled to save cost, all staff will receive 10 per cent of their basic salary as medical allowance, while workers occupying official quarters will forfeit their rent subsidy.

On vehicle loans, the circular added: "Vehicle loans are not to be granted directly by the Federal Government." "They are to be granted by financial institutions, preferably on a single digit interest rate and with government's guarantee, subject to the repayment capacity of the beneficiary. Where it is not possible for a single digit interest rate to be secured, government will intervene," it added. It, therefore, advised all organisations and agencies in federal public service which are funded from the annual federal budget, but which operate different salary structures than HASPS to implement the monetisation policy in consultation with the commission.

From Independent Newspapers Limited, October 5, 2005

 

Japanese Government Aims to Cut 10 Percent of Civil Service Jobs over Five Years

The Japanese government approved plans to cut jobs equivalent to 10 pct of the country's public servants and to redirect resources as part of Prime Minister Junichiro Koizumi's reform efforts. However, the total number of government servants is not expected to decrease by as much as 10 pct because Japan is considering reinforcing personnel in priority areas such as policing, immigration and prisons. Koizumi's cabinet ministers today approved a plan to reduce the 331,000-strong government workforce by 27,681 between April 2006 and March 2010, officials said.

This comes on top of an earlier plan to cut 5,549 jobs in the current fiscal year, raising the total number of planned job cuts over five years to 33,230, excluding military personnel. 'It is a task politicians should tackle as it would be impossible for bureaucrats,' Internal Affairs Minister Taro Aso said of the job cuts. The job reductions would be achieved by natural attrition or relocating employees, a ministry official said. 'Financial resources that had been used for the jobs shed would be saved to finance different jobs needed,' he said, adding the government would strive to reduce jobs on a net basis.

From forbes.com, October 4, 2005

More than 20,000 Fiji Public Servants Win Pay Rise

More than 20,000 Fiji public servants have been given a pay increase for 2004 known as the Cost of Living Adjustment or COLA. The government had refused to pay but the matter went to arbitration when the public servants threatened a nationwide strike. The government's permanent arbitrator, William Callancini, has handed down a graduated increase ranging from F$14 a week to the lowest paid, F$10 a week for those on middle incomes and F$7 a week for those at the higher end of the pay bracket. The labour minister, Kenneth Zinck, says the payments backdated to January 2004 will be made before Christmas. The general secretary of the Fiji Public Service Association, Rajeshwar Singh, says they are very happy with the award. Mr. Singh says apart from this award, civil servants will receive another two per cent increase based a previous agreement between the unions and the public service commission.

From Radio New Zealand International, October 21, 2005

High Courts Can't Interfere in Transfer of Civil Servants: SC

Lahore - A Supreme Court bench headed by Chief Justice Iftikhar Muhammad Chaudhry on Thursday held that according to Article 199 of the Constitution, the high courts had no authority to interfere in posting and transfers of civil servants. The SC bench observed this while accepting an application by the Punjab Small Industries Corporation (PSIC), challenging a Lahore High Court (LHC) order by which the court had declared the transfer of a regional director Sheikh Abdul Salam illegal. The PSIC submitted that its managing director had twice transferred Salam and sent him on secondment to the Punjab Islamic Research Centre but the LHC had declared the transfer illegal on both occasions. The corporation said that transferring employees was its discretion and the LHC could not interfere in the matter. The PSIC requested the SC to annul the LHC's order.

DPOs must monitor SHOs: SC - LAHORE: A Supreme Court (SC) bench headed by Chief Justice Iftikhar Muhammad Chaudhry on Thursday held that it is the duty of police officials to arrest suspects and action would be taken against district police officers (DPOs) who do not check the performance of their station house officers. The SC bench observed that DPOs should be aware of the happenings in their respective districts. The bench made these remarks while taking suo moto notice for the recovery of a man Muhammad Altaf's six-year-old girl Sadia Naz. The bench asked the Pakpattan DPO to explain why he did not find Sadia and why shouldn't the court take action against him. The DPO sought time from the bench to find the girl and was told to produce the girl in court in the second week of November. The bench also ordered the DPO to suspend City SHO Rana Saeed and initiate departmental proceedings against him for supporting the suspected kidnappers. The SC chief justice took suo moto action after reports of Sadia's kidnapping from the shrine of Baba Fareed were published in the press.

SC orders DIG to arrest Lyallpur nazim and Saddar SHO - A Supreme Court bench comprising Chief Justice Iftikhar Muhammad Chaudhry and Justice Tassadaq Hussain Gillani while taking suo moto notice has ordered the Faisalabad DIG to register a case against Lyallpur Union Council Nazim Rana Zahid Mahmood and the Saddar SHO nazim for detaining a citizen Muhammad Akram. The DIG was also directed to arrest the nazim and the SHO and send the challan to trial court after investigations. The court, taking suo moto action on Akram's letter, ordered the DIG to find Akram and produce him in court. Akram was produced in court and said that Rana Zahid and his brother-in-law Israr abducted and tortured him because he contested the union council election against Zahid. He added that his family moved several applications to the Saddar SHO for his recovery but he did not take any action. The court ordered Akram's release and action against Zahid and the SHO.

From Daily Times, October 28, 2005

Ideology And Pragmatism In Public Policy

Roger Kerr Executive Director Wellington New Zealand Business Roundtable - Delivered at Stokes Valley Rotary Club - An exchange at the meeting between representatives of the Green Party and the business community in Wellington a fortnight ago stimulated the reflections in this talk. One of the Greens present described support for free trade as an 'ideological' position. What did the speaker mean by ideological, I wondered? After all, Adam Smith, Karl Marx and John Maynard Keynes were all free traders. A pretty broad ideological spectrum, you might think. That's not the first time I've had occasion to reflect on the term ideology, of course. Critics of New Zealand's post-1984 economic reforms bandied it around freely. Indeed, as a recent book on globalisation put it:

It is close to a conventional wisdom that over the past two decades a group of ideological fanatics, called 'neo-liberals', have succeeded in imposing their creed on an innocent humanity, at the expense of democracy, prosperity, equality, the environment, human rights, decent treatment of labour and, indeed, everything that is good and wholesome. This view of the history of the past two decades is almost entirely mistaken.

First, while liberal ideas (not 'neo-liberal', since that is an incomprehensible piece of neo-Marxist jargon) have made progress over the past two decades, they have not done so through the offices of passionate liberals. On the contrary, the policy changes that go under the heading of 'neo-liberal' have been introduced as often by long-standing socialists and communists as by parties that would be considered on the political right. The principal reason for this transformation was failure of the alternatives, symbolized so powerfully by the collapse of the Soviet empire between 1989 and 1991.

For a time, some theoreticians of the left, including some in New Zealand's Labour Party, tried to find a 'third way' between socialism and a market economy. The project failed; we seldom hear talk of the 'third way' today. In reality, the drive behind the market-oriented reforms in New Zealand was the practical recognition that alternative policies had been tested to destruction. The focus of the reformers was on policies that worked – as demonstrated by orthodox economic reasoning and results.

From New Zealand Business Roundtable , October 12, 2005

16,000 Cvil Servants Laid Off in 7 Years

China laid off over 16,000 civil servants from 1996 to 2003, said Zhang Bolin, deputy chief of the CPC Central Committee's Organization Department and Minister of Personnel. Zhang explained the current status of China's civil service in an article published in the latest issue of the Seeking Truth magazine, saying that the "iron rice bowls" (guaranteed job security) of civil servants had been broken. In China, members of the civil service need to take an exam to qualify. All government organs have commenced open recruitment from the public through exams.

The Central Government's Party and governmental organs have employed 31,000 people since 1994, and over 630,000 people have become civil servants through exams in all parts of China since 2000. As the system of competition for posts has become popular, it has also been introduced in the promotion of civil servants. This has led to the promotion of outstanding staff. From 2000 through 2004, 645,000 people were promoted to upper management positions through this system. Training for civil servants is arranged regularly in a systematic way. Since 1994, more than 20 million civil servants participated in various training programs nationwide, which further enhanced the quality of civil servants. The system of reward and punishment functions effectively, rewarding civil servants for remarkable performances and penalizing those who violate discipline. This system has created a clean and honest administration of civil servants, Zhang said.

From AP, October 27, 2005

 

Civil Service: Minister Online All the Time

The civil service has set up a "contact the minister" link. "Users can contact the minister directly - when available - with regards to crucial issues relating to the civil service and the provision of public services - says PA Minister Baccini - I am available at all times". The PA's overhauled website will also feature a discussions forum, and a questionnaire on the quality of public service.

From (AGI) - Rome, Italy, October 24, 2005

Public Service Collective Agreement: 'Family Measures' Introduced

A new collective agreement for public service employees was signed yesterday by Prime Minister Lawrence Gonzi, flanked by finance ministry parliamentary secretary Tonio Fenech. Yesterday's signing, a visibly satisfied Dr Gonzi said, was the result of some seven to eight months of difficult negotiations. Unions representing public service employees – the Union Haddiema Maghqudin, General Workers' Union, Medical Association of Malta, Malta Union of Teachers, Malta Union of Midwives and Nurses and the Malta Union of Professional Psychologists – said they were happy with the agreement. Retroactive from 1 January, it will remain in force until December 2010, with the option that after three years new clauses could be negotiated so long as any new conditions did not have any financial impact on the agreement signed yesterday.

At the beginning of negotiations, the government had floated the idea of freezing salary increments in the public service, a proposed measure that was met with a good deal of opposition from the unions. The final agreement, however, provides for the maintenance of the current increment system. The new agreement includes a number of what Dr Gonzi described as "family measures", including the introduction of added flexibility in parental leave and in the utilisation of reduced working hours for parents. The agreement also provides that civil service parents with adopted children are to enjoy the same rights that natural parents enjoy. As per the agreement, the previous one-year parental leave mothers are entitled to for each new child will now be able to be taken in three, six or nine month stretches.

The new periods can be split up according to the family's needs, instead of taking an entire year period. Parents working with the civil service will also enjoy the right to reduced working hours until their children reach the age of 12, an improvement over the previous system, which allowed for the working of reduced hours until children reach eight years of age. The additional "career break" leave has also been raised from three to five years. The agreement has also identified avenues for flexitime work, job sharing and teleworking. Vacation leave, meanwhile, will now be calculated by the hour instead of by the day, as long as leave taken is not of below four hours. A full-time (40 hours per week) civil servant will now be entitled to 192 hours of leave per annum. The adherence to working hours will be enforced through the introduction of attendance -registering electronic or mechanical systems.

The new agreement has provided for the first-time establishment of a Conciliation Board within the Civil Service, which could be referred to for conciliation meetings should an industrial dispute be on the cards. Changes have also been made to the pre-retirement leave structure. Although the government had proposed the removal of the three-month pre-retirement leave, the final agreement provides for a maximum period of three months for such leave. Public service employees will now be given a day of pre-retirement leave for every four days of unutilised sick leave – up to a maximum of seven days per year. Entitlement to pre-retirement leave hinges on whether the employee had taken more than an annual average of 15 days of sick leave during employment in the public service, in which case an employee would not qualify.

From Malta Independent Online, October 28, 2005

Civil Service: Toll-free Complaints Number Established

The Civil Service have set up a toll-free number where to lodge complaints at. The number is 800.118.855.. "The number is dedicated to all those citizens that want to have their say on delays and inefficiencies in the civil service - says civil service minister Mario Baccini -. The initiative starts off as a means to simplify bureaucracy".

From AGI Online, October 24, 2005

EU Summit: Globalization Fund Need Recognized By EU

The idea of the globalization fund to back the retraining of sacked workers forms part of a paper presented to the summit by European Commission President Jose Manuel Barroso, which outlines the E.U.'s proposed response to the challenges of globalization. But outgoing German chancellor Gerhard Schroeder has concerns about how it will be funded, given Germany's budget constraints. The incoming government, to be headed by Angela Merkel, is also said to have reservations about the idea. Schroeder told leaders at the summit that while a resolution on talks about the E.U. budget were "very desirable," the German government had already reached its limit and beyond for further contributions. He said this was also the view of the incoming German government.

The U.K. Prime Minister's spokesman reiterated his words from earlier this week that there would be no detailed discussions about the E.U.'s EUR100 billion annual budget during the one-day summit, which he said would be more about the E.U.'s "strategic vision." "Today we are focusing on the E.U.'s strategic vision to shape the budget priorities," the spokesman said. "It is important to get the horse and cart in the right order...But we accept that a consensus on the questions doesn't mean there will be a consensus on the answers. The proof of the pudding (with regard to the budget) will come in December."

He added that there had been no change to the U.K.'s position on its EUR5.7 billion annual rebate from the E.U. The U.K. has said it is prepared to put the rebate "on the table," in return for an indication that other countries, notably France, are prepared to discuss reform of the Common Agricultural Policy. A French government official said the summit was expected to pass by with little incident, with a "gentleman's agreement" made in advance that it should pass without the public disagreements that often characterize E.U. summits. "Of course last-minute sparkles are always possible, but expectations are that no one will remember the summit or have reason to," the official said.

From The Business Online, October 27, 2005

Public Servant Strike Cripples the Faeroe Islands

Public servants in the Faeroe Islands are striking after the North Atlantic nation's minister of finance refused to grant them a 1 percent raise. The Faeroe Islands are paralysed by a public servant strike after wage negotiations broke down between the Home Rule Ministry of Finance and Economy and the nation's biggest labour organisation, the Confederation of Public Servants. After two days of talks with two negotiators, Minister of Finance Barour Nielsen scrapped a compromise proposal granting public servants a 1percent raise. Chairman of the Confederation of Public Servants, Gunnleivur Dalsgaard, had approved the negotiators' proposal, and said the decision to scrap it could only be interpreted as a lockout. He had subsequently sent word out to every union member in the Faeroe Islands to abandon work.

The strike has every public workplace, including government offices, closed. The national broadcaster's radio and television channels are not in operation, as journalists there are members of the union. More than 30 unions of public employees have wage agreements pending with the Faeroese Home Rule government, most of which will expire before the end of the year. The unions await the results of the negotiations with the Confederation of Public Servants, as they usually set the tone for other organisations' wage agreements with the government of the 47,000 strong North Atlantic nation.

From denmark.dk, October 14, 2005

 

Public Policy May Offer Co-term

The public policy undergraduate major at Stanford has recently undergone a change of department and is currently considering offering a master's degree in public policy. In an attempt to bring together researchers with related teaching programs, the public policy major is now a part of the Stanford Institute for Economic Policy Research (SIEPR), an interdisciplinary research-oriented organization. Prof. Bruce Owen, a senior fellow at SIEPR, is the new director of this interdisciplinary program. "The undergraduate public policy major focuses on subjects and skills that are closely related to the SIEPR research program," Owen said in an e-mail to The Daily. "Therefore, it made sense to have the major administered by SIEPR."

The program had previously been administered by Sharon Long, the dean of humanities and sciences, who will remain responsible for the academic oversight of the public policy major. According to Owen, the changes made to the program have thus far been largely administrative. He stated that "the presnt program is excellent and is not in need of fundamental change." "We hope to bring greater administrative stability and of course we will review the entire program to see where improvements could be made," Owen said. Fifth year co-terminal student Ethan Cantil-Voorhees, a public policy major, said he hopes that the change of administration will provide "the benefit of having more resources" due to the nature of the SIERP.

As for the possibility of instituting graduate public policy studies, Owen said it will take "at least a year to formulate and gain approval of any new graduate program." While many other schools across the country have already created a master's program in public policy, Owen said that the reason Stanford is just beginning to create one is that "no previous proposal has garnered sufficient support." According to Owen, the graduate program would provide the practical basis for "professional students, such as lawyers, engineers, doctors and so on, the opportunity to learn the language of modern policy analysis and to participate in interdisciplinary teams to address real world policy problems."

Cantil-Voorhees explained that if a master's program were implemented during his time as an undergraduate "I would have taken it rather than co-term in sociology, which is what I ended up doing." According to Owen, the process of creating a graduate program is still in the early stages of development. "We are just beginning to define the proposal," Owen said. "We have started by focusing on joint or 'dual' degrees in cooperation with Stanford's various graduate and professional schools. Later, this could be expanded to co-terminal undergraduates. There are no immediate plans to offer the degree on a stand-alone basis."

Senior Laura Villanueva said she did not place "nearly as much importance" on the changes to public policy undergraduate administration as she did on the possibility of a graduate option, stating that "something should be done about a master's program for future students." Owen acknowledged that "over the years many of Stanford's undergraduate policy majors have expressed strong support for a master's program." "At this point we have not focused on a co-terminal program and therefore have not yet begun a systematic assessment of undergraduate views," Owen said. "That will come later."

Junior public policy major Shawn Chen said he believed the creation of a master's program should go smoothly as certain public policy classes already include "a lot of master's work." "We basically wrote a master's thesis in one of these classes," Chen said. Undeclared freshman James Hohmann claimed that in majoring in public policy he is pursuing a passion. "One of the reasons I came to Stanford was the inter-disciplinary program," Hohmann said. "I would definitely consider pursuing graduate studies in public policy at Stanford. So far all the classes fascinate me."

From The Stanford Daily, Zewde Yeraswork , October 18, 2005

Good Governance Requires Good Public Service, Senior UN Official Says

Jose Antonio Ocampo briefs journalists - In a world where internal and external pressures are forcing governments to redefine the role of the State, they are also grappling with ways to create a public service that provides responsive governance, greater openness and new partnerships with civil society, a new United Nations report says. Good governance needs, above all, a good public sector, Josι Antonio Ocampo, the Under-Secretary-General who heads the Department of Economic and Social Affairs, said at a news conference in New York as he introduced "The World Public Sector Report 2005: Unlocking the Human Potential for Public Sector Performance."

Summing up the main message of the report, he said: "There is no shortcut to building a quality civil service." Appointment by merit was the single most important factor in determining the quality, prestige and integrity of a public service, followed by an effective performance management system to develop staff, the quality of the country's public and political leadership and the professionalism and strategic planning of its human resource management, Mr. Ocampo said.

The challenges to maintaining a high-quality civil service included sustaining the pension system, especially in countries where the benefits have been generous, offering adequate pay to balance monetary and non-monetary benefits and coping with the "brain drain" as highly skilled personnel migrate, the report says. As the proportion of people over 50 in the global population increases to 30 per cent by 2050 and fertility rates decline, rich countries are trying to solve their personnel problems by outsourcing, or shifting some of their activities to countries where comparable labour is available at a lower price, according to the report. This intensifies the existing pressures on the civil service in developing countries to attract well educated, skilled recruits.

From United Nations News, October 26, 2005

Government To Present New Contract Proposal To Public Servants Today

If the weather permits, the government intends to hand over a draft industrial agreement to The Bahamas Public Services Union (BPSU) today, hoping to end the long dispute with the union over increased salaries for its members. BPSU President John Pinder has been quite vocal over the last few months in lobbying for a $150 increase per month for his members. The government had offered a $1,300 lump sum proposal. However, the union rejected that sum and gave a counter proposal, requesting a $150 per month raise. But government officials have indicted that there is not enough money in the public treasury to support the increases being requested. Minister of Foreign Affairs and Public Service Fred Mitchell said at a press conference yesterday he hopes the union will find the new proposal to be satisfactory.

"It is the hope of the government that they will be accepted in the spirit in which they are offered and that with the exchange of proposals expected Monday that negotiations for a new agreement will ensue…and reach a successful and reasonable conclusion by Christmas," Minister Mitchell said. He indicated that this latest draft industrial agreement was approved during a Cabinet meeting last Tuesday. In drafting the proposal, Minister Mitchell indicated that there were a number of facts and rationales that were considered. "First there was the need to be responsible in the use and deployment of public funds for and on behalf of the government," he said. "Then there was the need to respond to the specific requests made by The Bahamas Public Services Union in their proposal for an industrial agreement presented to the government earlier in the year."

Minister Mitchell said during the discussions for the industrial agreement the prime minister had indicated that unless the financial part of the package was reasonable and within budget, the government would have been forced to raise taxes. "The prime minister said that he was not prepared to go to the Bahamian people with additional taxes simply to accommodate salaries in the public sector," Minister Mitchell said. "The underlying rationale then with regard to financial matters was to provide public servants with a wage that is fair and reflective of their responsibilities, but with a requirement for productivity and emphasis on merit in order to receive raises." Without revealing specifics of the new proposal, Minister Mitchell said that the draft covers education and training, addresses health and safety issues, and seeks to implement provisions on conflict of interest, and sexual harassment.

The draft proposal also covers increases in allowances, wages and productivity and it accepts the union's position on shift work, he said. The Cabinet sub-committee's press conference came two hours after Mr. Pinder's press conference yesterday. Mr. Pinder was joined by leaders of the Bahamas Union of Teachers and the Prison Staff Association. He said under no circumstance would the groups accept the $1,300 originally offered by the government.

From Bahama Journal, October 24, 2005

Louis Schimmel: Revolutionary Public Servant

On May 3, The Mackinac Center for Public Policy presented Louis Schimmel with its prestigious Lives, Fortunes and Sacred Honor Award for his unique and exemplary public service. Rarely has one man done so much with so little in such thankless tasks.Schimmel was a longtime executive director of the Municipal Advisory Council of Michigan, a statistical clearinghouse that tracked Michigan municipal bonds and Michigan municipal finance. He thoroughly understood the need for market incentives in city government and was thus well prepared in December 1986 when a Wayne County Circuit Court judge appointed him receiver for the small Michigan city of Ecorse, south of Detroit.

Ecorse had repeatedly failed to pay its water, sewer and utility bills, and its budget deficits were widely viewed as irreversible. But in less than four years, Schimmel completely erased the City's $6 million deficit by eliminating sinecures, privatizing a number of city services and creatively renegotiating the city's employee union contracts. The success was so stunning that it received regional and national media attention. A decade later, the state appointed Schimmel as "emergency financial manager" of the small Detroit-area city of Hamtramck, which had amassed a $2.4 million debt that threatened it with bankruptcy. Schimmel once again fought small-town politics and strong union resistance in order to privatize services, lay off unnecessary staff, renegotiate city contracts and end unwise management practices.

Schimmel bore these years of battling crisis, cronyism and local criticism with implacable determination and gruff good humor. The Center was thus honored to present him an award fashioned after the memorable closing line of the Declaration of Independence, where the signers pledged "our Lives, our Fortunes and our sacred Honor." Mackinac Center President Lawrence W. Reed and an intimate gathering of family and friends surprised Schimmel with the award at a dinner honoring him. As Reed observed: "(Louis) Schimmel redefined 'public service.' By word and deed, he made it abundantly clear that it means serving the public, not serving one's self at public expense." The idea, though simple and timeless, is revolutionary. John E. Coonradt is vice president for advancement for the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich. Permission to reprint in whole or in part is hereby granted, provided that the author and the Center are properly cited.

From mackinac.org, October 7, 2005

 
 

E Cape's Consultant Civil Service

The Eastern Cape government spent R3-billion on consultants - 15 times more than it spent on training its own employees - between 2002 and last year, according to a comprehensive report by the Public Service Accountability Monitor (PSAM) based in Grahamstown. The report, titled Staff Shortages, Incapacity and the Excessive Use of Consultants by the Eastern Cape Provincial Government and written by PSAM senior researcher Dr Neil Overy, examines the use of consultants in the provincial government during the 2002/03 and 2003/04 financial years. It highlights the relationship between institutional incapacity and high staff vacancy rates and the increasing reliance on consultants.

Overy based his research on departmental annual reports and budget statements and found that in the past financial year the Eastern Cape administration spent 7% of its total budget on consultants and professional services - up from 6% the year before. "This carries the danger of consultant spending increasingly crowding out spending on core departmental programmes," the report notes. In nominal terms, the provincial government spent R3-billion on consultants versus R220-million on training its own staff over the two-year period. The average vacancy rate across all 13 provincial departments in 2002/03 was 30%. This increased to 32% the following year. The report found that the average critical-post vacancy rate was 39% in 2002/03 and 47% in 2003/04.

An extreme example is the provincial education department, which, over the past two years, has underspent its -conditional grant - which is specifically geared to improving capacity - by 50%. The report also found that, despite public service regulations that performance management systems had to be fully implemented by April 2001, "there is little evidence to suggest that such systems have been properly implemented within Eastern Cape provincial government departments". It also appears that the use of consultants in the province is totally unchecked. "During the two years under review no recommendation has been made by any provincial portfolio committee in relation to the use of consultants by the provincial government," the report notes.

From Mail & Guardian Online, October 28, 2005

 

Sebi Clause 49 To Make Corporate Governance More Effective

Come January 1, 2006, corporate governance is all set to become more effective and efficient, thanks to clause 49 introduced by Sebi in the new corporate governance guidelines. The issue of corporate guidelines acquired centrestage as a result of the huge foreign investmets coming into India. These foreign investors wish to be assured that the companies they invest their money in will be managed well, and expect the law of the land to be open and transparent in functioning.

To further enhance their confidence and to safeguard retail investors, Sebi has revised clause 49 of its "listing agreement," which stipulates that at least one-third of the directors on the boards of the companies should be independent professionals. These directors should in no way be connected to the interests of promoters. Corporate governance is vital to integrity and efficiency of financial markets. It implies a well-defined, well-structured and well-communicated system to manage, direct and control the conduct of business of a company.

Major changes have been made to the definition of 'independent directors', strengthening of the responsibilities of audit committee and improving the quality of financial disclosure. The board as a whole has been tasked with the adoption of a formal code of conduct for senior management and the certification of financial statements issued by the CEO/CFO. The companies are required to form various committees like nomination committee, compensation committee, governance committee, to adhere to corporate governance.

The main objective of these committee is to bring about objectivity in determining the remuneration package while striking a balance between the interest of the company and the shareholders. The new law also requires the nomination committee of the board to be composed entirely of independent directors, who in return would be responsible for the evaluation and nomination of board members. This, hopefully, will open a new chapter in Indian corporate governance procedures and compliance.

From The Financial Express, October 23, 2005

Government To Cut Civil Servant Workforce by 10% Over 5 Years

The government decided Tuesday to cut the number of civil servants by 33,230, or at least 10% of its total workforce as of the end of fiscal 2004, on a net basis over the next five years, officials said. The plan includes cutting 5,549 jobs for fiscal 2005, which has been already approved, and 27,681 jobs from fiscal 2006 to 2009, the officials said.

From Japan Today, October 5, 2005

Civil Servant Jailed For Raping Daughter

A 34-year-old civil servant was sentenced to 11 years in jail and 12 strokes of the cane after he pleaded guilty before the Bandar High Court to raping his 14year-old daughter. Justice Datin Paduka Hayati heard from Prosecuting Officer Dk Hjh Hana Molina that the father of three girls had raped his eldest daughter at their house on two occasions. The two incidents occurred on October 13, 2004 and September 20, 2005 in the victim's bedroom.

From Borneo Bulletin, October 13, 2005

 

EU Commissioner Speaks Out on Internet Governance

The European Commission's Viviane Reding, the Commissioner responsible for Information Society and Media has made a speech on 'Opportunities and challenges of the Ubiquitous World and some words on Internet Governance 2005'. This is the text of what she said: "Recent years have witnessed important developments: decreases in prices, the expansion of the Internet, and the spread of broadband – there are now almost 50 million broadband subscribers in the EU. This is a critical mass. It sets the scene for new ways of delivering content. A new landscape is emerging based on fixed and mobile broadband communications, the digitisation of content, the addition of new functionalities to devices, increased storage capacity.

This convergence of voice, data and images is the new commercial reality. Telecom operators are broadcasting TV and broadcasters provide Internet services and telephony. Triple-play offers are becoming increasingly widespread. Voice over IP is ascendance. Television and radio programmes, movies, games, music and books are already available on both fixed and mobile platforms. Convergence is one of the drivers of the next phase of the Information Society. It is transforming European information, communication and media industries. It brings in new players and modifies the traditional value chains. And it is therefore at the heart of the policies of the European Commissioner for Information Society and Media.

I2010 - The new i2010 policy framework, which the Commission launched in June, takes full account of the reality of convergence as a technological challenge, a regulatory test and source of growth. Our first set of priorities for the coming years will be to adapt European rules to convergence in order to create a "single European information space". In particular, the Commissioner aims to modernise the rules on European audiovisual content and to give it legal certainty by putting it into a single market framework. We will also be reviewing the regulatory framework for electronic communications to see how well our current rules are performing and whether they will equip us adequately for the next generation of high bandwidth services. We will also work on interoperability and security, because as these services become multiplatform and ever more widely used a safe, secure and seamless web will be become a priority.

Our second set of priorities concern enhancing the role of ICT as a motor of growth in Europe. In Europe, ICTs explain 25% of economic growth and 40% of productivity increases. In other countries their impact is even more significant, in the United States for example. Our second aim therefore is to stimulate investment ICT research and innovation as the seedbed of Europe's future economic success. The third set of priorities emphasise the role of ICT in delivering benefits to the citizen. A more inclusive European Information Society will also be a more efficient and productive one. ICT is crucial to improving health care, learning, government services, and environmental quality.

Internet governance - The i2020 is a strategy framework for Europe, but the Commission is aware of the need to achieve our objectives in co-operation with the rest of the world. For this reason, I will give most of my attention today to the topical issue of internet governance. In recent days there have been numerous press reports about the apparent EU attempt to "wrest" control of the Internet from the US government. While making good headlines perhaps, this depiction of the EU position is a very misleading simplification that misses the key issues at stake in this important area.

First the World Summit on the Information Society process is not an EU-US bilateral. It is a World Summit - more than 100 countries from around the world are involved - not just their governments but all stakeholders private sector and civil society are working together to build consensus in the run-up to the summit that will take place in Tunis in November. Second, on Internet governance there is already an impressive degree of consensus on most issues. The difference of opinion that is grabbing the headlines is between the US and most of the rest of the world the small but important question of who and how names and addresses are allocated on the web.

For historic reasons, the US government has traditionally exercised a unilateral role in overseeing these key functions. At the beginning of the Internet, this was not particularly important - most users were academics and researchers. But the success of the world-wide web, which I'm proud to say was a European invention, has made the internet a central and strategically important part of each countries communications infrastructure, directly impacting economic growth and social development. The Domain Name System – which is at dispute – has become an integral part of the Internet's core architecture. What has changed?

No one is denying that the US government has done an excellent job in ensuring that the administration of this system has been fair and efficient. But, many countries are questioning if it is appropriate for one government alone to supervise such an important part of the infrastructure. The problem is that the US government effectively has the right to decide who can run each country's Top Level Domain such as dot.jp, dot.kr or dot.cn, while the governments of the countries concerned are only indirectly involved through an advisory committee to ICANN. It is the US government as well that has the sole right to decide when a new Top Level Domain can be introduced into cyberspace, whether it be a new country-code or a new so-called "generic" Top Level Domain such as .com or .net.

The recent controversy around a possible new .xxx Top Level Domain for adult content highlighted this bizarre situation. Several public administrations have expressed concern over this initiative, including the European Commission, but it will be the sole right of the US government to decide whether this Top Level Domain enters cyberspace or not, even though it will be visible on the screens of net users in countries all around the world.

These concerns are not new. The EU was expressing them as far back as the mid 1990's. In 1998 the Clinton administration conceded the legitimacy of foreign government's concerns in their White Paper on the Domain Name System. Indeed, the setting up of ICANN (Internet Corporation for Assigned Names and Numbers) in 1998 was in part to enable supervision to be "internationalised". The EU has always participated fully in the ICANN process. But the US government has never transferred this unilateral power. And several countries are concerned that in the US has now gone back on this intention. In particular, in June the US Government announced without warning that it had decided to "maintain its historic role in authorizing changes or modifications to the authoritative root zone file."

This is very disappointing to Europe and others who have worked towards a cooperative global approach since 1998. The US statement is a recipe for stalemate in the Geneva discussions on this point. The European position - Europe, far from being in an extreme position, is in the middle between US unilateralism and much stronger demands from other countries for multilateralism. But our position of deal broker cannot work unless the US recommits to its historic compromise to internationalise the Internet governance regime I would re-emphasise that the EU approach to the Internet is pro-industry and pro freedom of expression. It is mostly similar and often identical to that of the US. We fully appreciate the primary role of the private sector in developing and deploying the Internet technologies and services. We understand that governments must not interfere in the day-to-day operations that underpin the management of the Internet. We fully support ICANN.

The EU position is therefore not an attempt by governments to take control of the Internet, as has unfortunately been suggested in some quarters of the press. The EU proposal - The EU position is rather a recognition of the obligation of governments to help the Internet deliver on its potential. The Internet is not an unregulated space - anything that is illegal in the off-line world is illegal on-line. Citizens expect governments to take measures to deal with fraud, spam, hacking, violations of data protection and all forms of cyber-crime. Governments also need to do what they can to ensure the stability and security of their national communications networks such as the Internet.

Governments need to be able to cooperate with each other at the global level to fulfil these responsibilities. But there is no natural home where issues requiring such cooperation, between governments and stakeholders can be addressed, where problems can be identified and the necessary corrective or preventative action can be engaged. The EU is proposing a new model for international cooperation and a forum based on a set of fundamental principles. This forum would not replace existing mechanisms or institutions, but complement them and adhering to the key principles of the Internet – interoperability, openness and the end-to-end principle. A predictable and well co-ordinated public policy environment is an advantage for business. The same is true for the governance of the Internet.

That's why the forthcoming summit in Tunis provides us all with an important opportunity to take the first steps in building a truly global consensus on how to achieve this aim for the benefit of all the world's businesses, citizens and users. Good governance and government are not necessarily mutually exclusive. The Internet was, and is still being built and developed in a spirit of partnership, consensus and openness. The EU is only arguing that governments need to adopt the same cooperative model if they are to ensure their role is a positive one in the continuing story of this amazing technology.

From PublicTechnology.net, October 24, 2005

Scotland A Civil Servant's Lot Is Not a Clear One...

I have to admit that my knowledge of the civil service comes from watching repeats of Yes Minister. In my mind, the people who populate government buildings are grey-suited men bamboozling cabinet ministers with endless jargon and pointless meetings. And I don't think I'm alone in that respect. Aside from the bureaucrats themselves and - possibly - their political masters, few people have a clue about the inner workings of government. Which lends itself to the suspicion that all civil servants do is create more work for themselves, with meetings that only lead to more meetings, while administrators, supervisors and co-ordinators just administer, supervise and co-ordinate the growing ranks of civil servants. After all, the number at Holyrood has risen by 31 per cent since devolution to 4411. What do they all do?

Earlier this year, John Elvidge, Scotland's most senior civil servant, challenged any critic to spend time with staff to see how hard they work - arguing that every one of his workers was "fully and productively used". That's how I ended up, besuited, at the Scottish Executive's offices at Victoria Quay, ready to shadow the civil servants drafting the forthcoming Licensing Bill, which is due to go before the Scottish Parliament in November. The Bill aims to reform the licensing laws, tackle underage boozing and crack down on Scotland's binge drinking culture. Instead of giving every pub and club the same opening hours, the Bill proposes treating them on a "premises to premises" basis.

All very laudable, but it's already been two years in development. What have they been doing? I shadow Jacqueline Conlan for the day, the Executive's head of the licensing team, a civil servant with 13 years' experience. First stop Stirling, via public transport, of course - on this occasion the train, from Edinburgh. There we meet five suited figures and Jacqueline spends 90 minutes discussing terms such as "over-provision" with them. I hit the coffee. The one fact I do manage to glean from this is that most of these guys aren't happy with this nearly-completed legislation.

It was, it transpires, a meeting of the Overprovision Sub Group of the National Licensing Forum - a group of pub chain chief executives, alcohol abuse charities, police officers, solicitors and licensing bosses who advise the Executive. They were scrutinising the paperwork to argue about what the effects of having too many pubs in towns and cities across Scotland could be. Consultation meetings about legislation sound fine, for our open, in-touch, shiny Scottish democracy, but two years' worth? Apparently though, if the slightest thing is wrong with the Bill - if it isn't worded correctly - then it could create a loophole for pubs to exploit or could just end up as bad law. As a result, it can take years of work to get it right, particularly when every pub and club in the country will be affected.

Back in Edinburgh, we'd missed lunch, so went straight into another meeting, this time with Jacqueline's team, their solicitor and draughtsmen - the guys who actually write the new law - for another technically-incoherent few hours. Amendments and corrections needed to be made to the already sizeable document, and these were the people who had to come up with the suggestions for approval by their political masters - our next port of call. A quick drive to Holyrood and we were ushered into the study of George Lyon, the minister overseeing the Licensing Bill. Again, technicalities were discussed but this time they seemed to be far more direct, with simple yes or no answers on both sides. Hmm . . . I wonder why?

By the end of the meeting, it was 6.30pm. But that wasn't the end of my day. At 11.30pm I rendezvoused with the team at a city nightclub. I was entirely suspicious that this late-night excursion happened to be on the day I was there - surely it couldn't be usual? - but they were adamant that this close to a piece of legislation's deadline, late working is the norm. We were there for a tour of the club's security measures, such as CCTV. The point club owners are making is, if pubs are going to be allowed to open club-hours, they should be forced to put the same, expensive, measures in place. Fair enough, but did we have to be here at midnight to see it?

So at the end of a very long day, can I honestly say civil servants earn their taxpayers' crust? When you understand little of the jargon, it's a difficult one to answer. Consultation is only worthwhile if the views being gathered are genuinely relevant, and a line has to been drawn somewhere. Just what was really achieved that day, I don't know. On the other hand, no-one wants loopholes in laws and rushed, botched legislation.The only thing I know for sure is that I'm glad it's not me who has to do it.

From Scotsman.com, October 14, 2005

Top Civil Servant Suggests Private Sector Recruitment

One of the State's most powerful civil servants has said the public sector should consider recruiting managers from the private sector to ensure people with the right skills end up in top positions. The Secretary General of the Department of the Taoiseach, Dermot McCarthy, called for a re-examination of how people were recruited into the public service. "We . . . need to look at our system and how we get the right people with the right skills into leadership positions," he said. "Recruiting from the private sector is a clear and attractive option." He also said the levels of change and productivity in the public sector should be benchmarked against those in the private sector, if salaries were to be benchmarked in this way. The benchmarking process justified a new approach to hiring management and rewarding staff, he said.

His comments at the weekend, at the Dublin Economics Workshop in Kenmare, come after weeks of controversy over wasteful public spending on private sector consultants. Mr McCarthy said that while the way the public sector did business had changed, this had not resulted in an equivalent improvement in "outputs" or performance. "It's not always evident that changes in processes have produced changes in outputs. This is in part because it's very difficult to measure output, but also because we have not put enough effort into both measuring and reporting on what is to be achieved. We need to stick with the development and fine tuning of performance indicators", said Mr McCarthy, who was speaking in a private capacity.

On measuring public service performance, the chairman of the Civil Service Performance Verification Group, Mr Donal de Butleir, said complex objectives and a lack of competition were hindering change management in the public sector. "If you have a choice, to change or go out of business then change becomes attractive. The impetus to change is absent from the public sector," he said. Mr de Butleir said many improvements had been delivered in recent years as a result of the Sustaining Progress - agreement in areas such as paying car tax, filing taxes, receiving social welfare benefits and obtaining passports. Promotions in the public service were increasingly based on competition, while the system of dispute arbitration had been greatly improved.

But he also said the scope of Government activity should be narrowed. "Government is in the business of making briquettes, growing trees, providing health insurance, selling gas, running buses and trains; running ports and airports; providing electricity; running greyhound races, running a postal service and a broadcasting service. "In my view, the public sector should concentrate on its key role as legislator and provider (or funder) of public goods and leave the provision of services to competitive markets as far as possible". Further action was needed in the public sector to manage performance and reward, control pension costs and improve accounting and information systems, he said.

From The Irish Times, by Marc Coleman, Economics Editor, October 17, 2005

Top Civil Servant Moves to Bank

The Bank of England has named a top civil servant, Sir John Gieve, as its new deputy governor. He will replace Sir Andrew Large on the Monetary Policy Committee (MPC) which sets interest rates. With the MPC closely divided on whether to cut interest rates, Sir John could tip the balance towards further cuts. Sir Andrew Large was one of the most hawkish members of the MPC, arguing that it was too early to conclude that inflationary pressures had eased. Blunkett scandal - Sir John Gieve is currently the permanent secretary at the Home Office, where he faced questions over the role of the civil service in the scandal which led to David Blunkett's resignation. He and other civil servants were criticised for failing to recall how the visa for Mr Blunkett's ex-lover's nanny came to be fast-tracked.

However, Sir Alan Budd, who led an inquiry into the affair, said he had no reason to believe anyone involved had deliberately withheld information. Sir John was knighted in December 2004. He has spent much of his career at the Treasury, where he was in charge of the first two spending reviews led by Gordon Brown, and has also been in charge of policy on financial stability. "Sir John brings a wealth of experience to the job," Mr Brown said in a statement released by the Treasury. "He has held some of the most senior positions in government. He has extensive expertise of the financial stability and regulatory issues which form part of the remit of Deputy Governor." Previously, Sir John had been tipped to be in the running to become the head of the civil service - a job that ultimately went to Gus O'Donnell, the permanent secretary at the Treasury.

Civil servants - He is the second civil servant to move over to the Bank, following the appointment of Rachel Lomax as deputy governor. Sir John will replace Sir Andrew Large - former deputy head of Barclays - who resigned his five-year term at the Bank early in order to return to the City. Sir Andrew was among the most hawkish bank governors, voting to raise interest rates in 12 of the 36 MPC meetings he attended. "Clearly the departure of the most hawkish member of the committee suggests a risk of a marginally more dovish balance," said Alan Clarke, UK economist at BNP Paribas. The Bank cut interest rates in August but has since kept them on hold, caught between the slowing UK economy and fears that higher oil prices will feed through to higher inflation. Bank Governor Mervyn King has warned that the Bank faces uncertain times ahead, and that the era of stable prices and high growth might be drawing to an end.

From BBC News, October 18, 2005

The View from the ICT Management Board

ICT Ireland's primary objective is for this country to be a worldwide leader in information and communications technology industries, and ICT's management board, chaired by Michael Daly, IBM, and comprised of 14 chief executives drawn from a cross-section of ICT companies, has a strong role to play in the delivery of that objective. Lionel Alexander, vice-president and managing director HP Inkjet Operations Ireland, and a member of the management board said the board "is responsible for strategy, setting the on-going work programme and establishing and monitoring the working committees. We interact with the directorate to ensure that ICT Ireland's agenda is current and relevant to the members' needs''.

The ICT Management Board meets six times a year to ensure that it keeps abreast of the challenges and ever changing issues facing the sector. Companies represented on the current board include, Atlantic Bridge Ventures Ltd, Chorus, Commergy, HP, IBM, Intel, Iona Technologies, Microsoft, Oracle, SteelTrace and Xilinx. By its nature ICT is not a sector to rest on its laurels, and although it accounts for 25 per cent of Ireland's exports, and the 1300 companies which comprise the sector are responsible for the provision of 90,000 jobs, the future is always the main priority within ICT. "If you look forward to 2015, 80 per cent of the Irish population will still be in employment. Given this high percentage, it is all the more important to nurture and facilitate growth within ICT. A key role for the Management Board is therefore to build a stable and sustainable environment for future growth in ICT'', Alexander said.

"It is important that the board influences positive changes within ICT. Critical to the sector's long-term future is the ability to innovate and to create intellectual property. Innovation in technology and in business models is vital to the evolution of the ICT industry. The ICT sector needs to continue to transform, so that it can remain a key driver within the Irish economy. As I see it the Management Board's role is to support this transformation, by stimulating innovation so businesses can prosper''. To deliver on its objective, Alexander agreed that attracting, developing and retaining the right talent is critical to the transformation of the industry.

"Skills shortages pose a major challenge. We have a hot job market in Ireland at present. If you are a company that has invested heavily in R&D, this situation is of serious concern. Many companies invest heavily on developing talent in say R&D, and in doing so, also create a very marketable talent and therefore, the ability to retain that talent in a tight job market becomes difficult. For companies to make a huge investment in developing people and to then lose them, is a very significant factor." As the cost of doing business in Ireland continues to rise, competitiveness is eroded. That's why Lionel Alexander believes that Ireland should focus on the creation of "high road businesses'' - value-added businesses involved in the creation of intellectual property, the type of businesses Ireland Inc can develop and sustain in the future.

"Costs are key in many areas of business and the ICT sector is no different. It is vital to keep ahead of the curve. To do so, we need to maintain competitive tax structures and we need continued improvement in infrastructure in order to attract more ICT investment'', Alexander said. While he is mindful of the challenges ahead, he also sees plenty of opportunities for Ireland's ICT sector. "Ireland is well placed to become a global hub for ICT. We have the advantage of being in Europe, being centrally located, and this gives ICT companies here a distinct advantage when it comes to elevating themselves to operate at a global level. In the future, organisations will need to be knowledge based, global businesses. "That's a journey, and for our ICT sector it's a journey which involves upgrading and rebalancing skills. You do not become a value-added, global player overnight, you have to invest in the future strategic development needs of your organisation'', commented Alexander.

Taking an introspective look at the sector here in Ireland, Alexander acknowledged, that ICT has come a long way and ICT Ireland has done much to facilitate that growth and development, allowing companies with a lot of common ground to come together to help one another, to lobby with one voice and basically to provide the sector with leveraging power. "You will always have competitiveness amongst ICT firms, but there are a significant number of areas where we can work towards helping one another to the betterment of the sector'', Alexander said, adding, "ICT Ireland should not be viewed as a solution for all problems, but it certainly elevates our standing to help us lobby more effectively at government and international level''.

Looking to the future, Alexander said, "Companies such as HP, Intel, IBM and Microsoft who have been in Ireland for more then ten or fifteen years have moved on from the traditional model of startups in Ireland, which involved job creation through manufacturing, to where we are now, with a strong emphasis on value-added R&D activities. We have received great support from the government, to create that bridge from manufacturing to development. What's required now is additional funding to help such companies move into the high end of research." According to Alexander, what's required to progress R&D activities in companies is an aggressive approach towards achieving Ireland's R&D spending target of 2.5 of GNP by 2010.

From The Post.IE, October 23, 2005

Call for German Schemes to Adopt Governance Code

Professor Wolfgang Gerke, a financial expert who recently unveiled a corporate governance code for asset managers, has called for the code to be embraced by German pension funds. Gerke unveiled the code, whose adoption is voluntary, last April. According to him, the code is essential in improving investor protection and transparency on capital markets. Although the code was originally understood to apply to asset managers only, Gerke noted that it was relevant for all capital market players - including pension funds that manage their own assets. "It's not that I suspect that there are hidden risks among pension funds. No, the reason why I believe that they should consider it is simply because they are huge market participants," Gerke told IPE on the margins of the autumn conference for German occupational association aba.

Among other things, Gerke's code recommends that the supervisory board for an asset manager include one member who has nothing to do with the manager, its shareholders or even its business partners. The code also suggests that the manager's supervisory board create a special committee to boost oversight of the company. And it recommends that the manager regularly inform investors about its corporate governance via the internet and in its annual report. Klaus Stiefermann, managing director of aba, said the association's members welcomed Gerke's code.

"It's an important development in the European debate about improving pension fund governance and transparency on capital markets," Stiefermann said, adding that both he and German pension fund representatives would "intensely discuss" Gerke's proposals. Aba's pension fund members have €366bn in assets, almost 60% of which are held as book reserves but are being increasingly financed by external funds. Elsewhere, the Financial Times, citing official sources, said the government plans to raise the retirement age to 67 from 65.

From IPE.com, October 27, 2005

 

Disciplined Civil Servant Gets Bonus

Civil Service Commission disciplinary court finds former consul general to San Francisco guilty of scheming against subordinate, exploiting seniority, but Foreign Ministry appoints him to another prestigious post in U.S.; employee who filed complaint against consul general says, 'I do not believe such a person can represent Israel. It is very frustrating that he continues to do his job as though nothing has happened' - Vered Luvitch. Can a senior civil servant who was disciplined for scheming against one of his employees be permitted to hold a prestigious post in the U.S.? Apparently so: Yossi Amrani, the former Israeli consul general in San Francisco, was recently appointed to a similar position in another consulate in the U.S.

It all started when an employee in the Israeli consulate in San Francisco filed a complaint against then-Consul General Yossi Amrani, claiming Amrani had continuously schemed against him. "He was obsessive towards me," the employee, who agreed to speak under condition of anonymity, said. The employee was initially hired as the consul's clerk; he was later appointed to a higher-ranking position, but was eventually fired after he had spoken to Amrani about two job offers he had received from the Jewish Federation of San Francisco. Amrani met with the Federation's director and told him the employee's performance level had dropped and that he had lost trust in the employee.

Following the meeting the consulate fired the employee, claiming his performance level at work was deteriorating, that he lacked credibility and that he attempted to obtain a license to work in the U.S. 'What kind of message does this send to the public?' Amrani ordered that the termination go into effect immediately thereafter and instructed consulate staff to prevent the employee from entering the premises. The worker's complaint led to an investigation, and last February Amrani was brought before the Civil Service Commission disciplinary court, where he was convicted, among other things, of exploiting his seniority, scheming against an employee and violating the Civil Servants' Ethics Code Law.

The court withheld Amrani's salary for one month and froze his diplomatic ranking for nine months. However, the conviction did not deter the Foreign Ministry from recently appointing Amrani to the post of consul general in Houston - if only temporarily and informally. Foreign Ministry spokeswoman Rachel Shani told Ynet in response, "The investigation into the matter did not find that Amrani harassed the employee, and his appointment to the Houston position is only temporary." "The Civil Service Commission's decision did not pose any constraints regarding Amrani's future posts," she added. The employee said, "I do not believe such a person can represent Israel. It is very frustrating that he continues to do his job as though nothing has happened." Attorney Eyal Shternberg, who is representing the former employee, said in response to Amrani's appointment, "What kind of message does this send to the public?"

From Ynetnews, October 10, 2005

Low-Salaried Civil Servant Rejects SR2 Million Bribe

Mohammad Saeed Al-Ghamdi, a low-salaried Saudi government employee in Jubail, has set an example for all civil servants by refusing a bribe of SR2 million. Custodian of the Two Holy Mosques King Abdullah commended Al-Ghamdi for his honesty and rewarded him with a promotion and a salary increase. According to a report carried by Al-Watan Arabic daily, a real estate developer offered Al-Ghamdi the bribe in order to establish ownership of land worth SR100 million. The bribe was offered while Al-Ghamdi was working at Jubail Court. "I did not want the SR2 million bribe because I know it is not lawful money. I will never feed my children with money from a bribe. If I had done what he asked, I would have felt guilty for the rest of my life," the paper quoted Al-Ghamdi as saying.

The developer selected Al-Ghamdi because he mistakenly believed that a man receiving a monthly salary of only SR1,500 would be easy to bribe. The developer wanted Al-Ghamdi to remove a document and make some changes to it. "The developer came to me and wanted me to do some paper work related to land he owned in eastern Jubail. I showed the document to the judge and he ordered me to compare it with the original. When I did, I found that the paper the developer had given me was not the same as the original. I planned to go back to the judge to tell him about it when the developer approached me and offered me SR1 million if I would use the fake document and complete the formalities. I asked for some time to think; then I went to the judge and told him about it. He informed the authorities."

Al-Ghamdi continued, "Four days later, the developer came back to me. This time he asked me to bring the original document so he could make the changes to it. I told him that was impossible and he then offered me SR2 million." Al-Ghamdi cooperated with the authorities who arrested the real estate developer. Officers had recorded the conversation between him and Al-Ghamdi and as a result, he is now in jail. "I found out that the land he was talking about was worth SR100 million and the reason he chose me to abet him in this crime was my low salary. He told me that if I helped him my life would change forever and improve completely," Al-Ghamdi said.

From Arab News, October 5, 2005

 

Expropriations, Cooperatives and Co-management

Some 500 residents of the township of Cumanacoa, in the state of Sucre - mostly workers and cooperative members directly or indirectly employed by the local sugar processing plant, Central Azucarero Cumanacoa - turned out on September 23 to hear the news that the Venezuelan parliament would be expropriating the plant on September 26. Present at the assembly was Jose Gregorio Villaroel, the north-east regional coordinator of the labour ministry. After the event, he explained to Green Left Weekly: "In this case, the expropriation will be carried out to benefit the 172 workers, 533 [sugar-cane] producers and more than 3230 workers on sugar plantations. If we multiply that by five members in each family we are talking about the whole municipality that is going to benefit from this."

Since early September, the Venezuelan government of socialist President Hugo Chavez has moved to expropriate a number of factories, the owners of which had closed them down and which were deemed by the government to be strategic to the Venezuelan economy and the welfare of its people, particularly with regard to what has been termed "food sovereignty" - the ability of the country to be self-sufficient in food production. This was the case with the Central Azucarero Cumanacoa. Opened in 1954, the plant reached a peak production of 320,000 tonnes of sugar in 1975, generating 3075 direct jobs and 18,400 indirect jobs. With its privatisation in 1992, however, production dropped to 54,000 tonnes in 2004 (the same level of output it had 50 years earlier when it first opened).

Former employees told GLW that before the owners closed the plant many of them had been paid the wages owing to them in sugar, which they then had to sell in order to recuperate the money. "This is the heart of the economy", said Rafael Emilio Barrios, mayor of the municipality of Montes, in which Cumanacoa is located. "Putting it in the hands of the people will be the biggest guarantee that it will have a positive effect for the community." The Montes municipal council has supported the workers' struggle, initiating the legal proceedings in the federal parliament for the adoption of a resolution for the plant's expropriation.

"With articles 299 and 115 of the constitution, it is possible to expropriate for the cause of public utility", said Villaroel. "What does that mean? We go through a legal process and it is declared of public utility. It is not that the property right is not recognised, but the state assumes the payment for that property, which is what is going to be done with this sugar plant." Buy-outs - In some cases - like that of the recent takeover of the Heinz tomato processing plant in the state of Monagas -the owners are willing to negotiate before expropriation proceedings are completed. Having offered the plant, which had been shutdown for a number of years, to the government for the sum of US$600,000, the two came to an agreement that the government would purchase it for $260,000.

"Once the expropriation is declared, we negotiate", said Villaroel. "We say, 'Look Mr, the state values this property at so much, but from this we will discount the debts you have to the workers' entitlements, the debts you have with Venezuelan banks and so on. All this was a mafia because they would receive benefits from the state, but they never gave anything to the population." The government expropriated Central Azucarero Cumanacoa, with compensation paid to the owner, and will enter into a process of co-management with those directly and indirectly employed at the plant. Two cooperatives, one consisting of the 172 former employees and another with the 533 sugar-cane farmers, will be involved in the running of the plant.

Luis Sanchez, the vice president of the farmers' cooperative, explained to GLW that the aim was to integrate the two cooperatives, as well as help to organise the workers on the sugar plantations and the truck drivers into cooperatives. The idea of co-management, self-management and cooperatives, of the participation of the workers in the running of their workplaces, is part of the Chavez government's promotion of an alternative economy based on solidarity and humanist principles. The idea is that alongside of, but in some cases working with, the private sector the government will promote new forms of production based on the democratisation of workplaces to replace the still dominant capitalist economy.

For Villaroel, this is part of changing the "perverse dynamic of the capitalist economy". He said: "Here, what we are trying to bring in is horizontality, where the workers are the collective owners of their companies." The government has encouraged the small- and medium-sized private businesses to involve themselves in the process of co-management, offering credits and loans for businesses that are in financial trouble in return for the managers involving the workers in the running of the business, something that a number of firms have already taken up. In an interview in the September 30 Caracas Temas daily, Minister for Popular Economy Elias Jaua explained the government's view on this issue: "We have policies directed towards this sector, the small and medium-size industries. We are developing policies of financing through this ministry. We are working together in experiences of co-management."

Jaua went on to explain that at this stage, the capitalist economy and the alternative economy "are not mutually exclusive, but the development of this historical process makes it incompatible with the [big-business] oligarchy and monopolies that are an essential part of the capitalist model ... "The national private sector can understand the process and incorporate itself into the new dynamic of society or it will be simply displaced by the new productive forces which have a better quality production, a vision based much more on solidarity than consumption."

Company for social production - On the 40-minute trip to the Cumana, state capital of Sucre, I stopped at Cacao Sucre, an expropriated sugar mill that the workers received a loan from the government to purchase and run as a cooperative. The factory had been closed for eight years by its private owners, leaving 120 workers out on the street. The state governor put a call out for the workers to form themselves into a cooperative and receive the necessary training in Mission Vuelvan Caras so that they could come back to work, and also take over the running of the factory. The 94 workers now employed at the sugar processing plant Cacao Sucre have integrated their cooperative with the 3665-strong sugar-cane farmers' cooperative. The food hall at the factory is run by a cooperative of 18 women, graduates from Mission Vuelvan Caras.

At the formal handing over of the factory to the workers in July, Chavez declared that Cacao Sucre would be the first "company for social production" (EPS). He explained that these EPS would be aimed at "the production of goods and services to satisfy the needs of the community, but at the same time they would assume a social responsibility with the community". To facilitate this, the EPS would set a portion of their profits into a fund to help pay for health, education and other projects of benefit to the local community. Chavez said that it was necessary that all the public sector companies be transformed into EPS.

For these projects to be truly successful, Villaroel said, "there needs to be a change in the mentality of the workers". Marcela Maspero, one of the national coordinators of the UNT labour federation agreed, commenting to GLW: "Our biggest preoccupation with this process of co-management ... is that we make sure not to run the risk of converting our comrades into another neoliberal capitalist and we are able to see beyond that towards the necessity of the community, how we use this to benefit those who have been excluded, who aren't employed, how we go about creating a whole new socialist culture surrounding property and the generation of benefits."

Villaroel told GLW that the EPS were aimed at breaking "with the capitalist economy, which promotes greed, individualism, the lack of solidarity ... It is impossible to explain how a sugar plant can exist here and belts of misery exist next to it. But the company never invested, never assumed its social responsibility. The workers at the sugar plant have to assume this responsibility. They have to attend to the problems of malnutrition, they have to open up the food hall and put it to function not just for the workers but for the people who don't have the resources, extend their hand to Mission Barrio Adentro, the Cuban doctors ... "This is part of a company which has a social function, not like the monster that we see stealing from the workers their labour power and their surplus value."

From Green Left Weekly, October 26, 2005

Civil Service Accountability

Some three weeks ago we congratulated the Minister of Education, Hon Alden McLaughlin for publicly identifying and facing up to certain administrative shortcomings within his portfolio. It is, therefore, pleasing to see that the government as a whole has now grasped this particular nettle with the introduction of new legislation aimed at bringing performance standards and accountability into the civil service. We all know individuals within this country's civil service who have taken advantage of or abused the absence of any real supervision of their work habits. And we all know or have come across civil servants who seem to offer little in the way of competence in the position they occupy.

Such individuals, and indeed the entire 'General Orders' culture and tradition, may experience some difficulties in adapting to the new environment. But adapt they must, or otherwise face removal from the equation. After all, civil servants are spending, and being paid out of public funds in their day to day employment and the public accordingly has the right to expect efficiency, effectiveness and economy. In other words, value for money.

In addition, now that hiring and firing will, to a much greater extent, be devolved from the Governor to the heads of department (or equivalent), those individuals in whom these new powers are reposed must expect a far greater degree of public scrutiny and perhaps criticism. In other words, accountability. However, effective public sector management is more than just modernising the country's institutions; it is also about fostering a dynamic partnership with civil society in general and the private sector in particular, in order to improve the quality of service delivery, enhance social responsibilities and encourage the participation of citizens in decision-making.

Not only do inefficiencies, unethical practices and lack of accountability contribute to economic difficulties and/or act as a brake on economic progress and development, they also adversely affect the responsiveness, legitimacy and transparency of government; the effective implementation of its stated policies; and its efforts to bring about recovery and/or development in general. Unfortunately, the situation is a complex one, given that political, cultural and economic factors all lie at the root of what is a multidimensional problem.

In addition, we are just emerging from a period of several years when questionable behaviour was seemingly rampant at the top level of government and politics. As we suggested on an earlier occasion, it is not too far-fetched to associate such behaviour on the part of elected officials with the apparently contemporaneous decline in standards in the country, culminating in what has frequently been referred to as a "crime wave". After all, if those perceived to be in positions of authority demonstrate such behaviour then why should that not be taken as an example to be followed by all and sundry?

By the same token, substantive progress in improving the efficiency, ethics and economy of the public sector ought to be seen as an example to be emulated by everyone else and, whilst by no means the complete answer, may at least go some way towards the restoration of traditional Caymanian standards of behaviour and order. Even the best of practices under democratic systems of governance can give way to abuses. For this reason, a crucial safeguard of high standards of public ethics and accountability has to reside in the ability of the people to hold public officials and politicians accountable for their acts and also to ensure that public institutions fulfill their functions properly and responsibly. The ongoing process of civil service reform in the Cayman Islands should enhance such opportunities.

From Cayman Net News, October 21, 2005

 

The Net Is Anarchy: Keep It That Way

The internet, long seen as a neutral realm free of government interference, is now hot political property. Not surprisingly, therefore, both the European Union and the United Nations are now trying to grab control of the internet. This has major consequences for business and for individuals. Since 1998, a non-profit organisation named ICANN (Internet Corporation for Assigned Names and Numbers) has been responsible for managing and coordinating the internet's domain names. ICANN ensures that what is typed in the address bar matches the site trying to be accessed. Such an organisation is necessary to ensure the stability and growth of the internet.

At the moment, the internet is an ungoverned, unregulated, anarchic medium - merely a mutual agreement between computer users all around the world to connect to each other in a certain way. Given this blank slate, business and innovation has thrived online. Business to business commerce has exploded over the past few years. In Australia, 31 per cent of businesses reported placing orders over the internet in 2004. This will grow as business uptake of broadband intensifies. Until now, ICANN's role has been merely to facilitate and smooth this explosion of internet activity.

The European Union, as well as a motley collection of less-than-democratic nations such as Iran, Cuba and China, are forcefully trying to replace ICANN with an as-yet-unspecified UN department. Such a proposal will be under consideration at the United Nations Working Group on Internet Governance meeting next month in Tunis. Arguing that the internet is a global resource, the European Union insists that the private sector must share its responsibility of overseeing it with the UN. By ceding this power over to governments, every aspect of the anarchic freedom that the internet represents is under threat. The UN wants to use the internet's structure to pursue specific goals - to close the "digital divide" and to "harness the potential of information" for the world's impoverished.

But the inequalities the UN claims it wants to overcome stem not from the internet itself, but from government policy. Syria has even advocated taxing domain names to subsidise an international universal service right. No matter how hard the new UN body will try to reverse the "digital divide" by reallocating domain names and shifting the location of servers, the only way that internet uptake can be increased internationally is through action within the countries themselves. That is, the same way any technological advance has filtered down to the poorer countries. By building stable institutions, maximising economic freedom, and ensuring prosperity, which creates consumer demand. No amount of political action by the UN can replace this process.

The defining characteristic of the internet is not intelligence or its capacity to fulfil specific aims, but its simplicity. It is a "dumb" medium, which is only structurally suited to transmitting data from one computer to another. It can't conduct public policy. Businesses and individuals have come to rely on the internet to carry out their personal and commercial interactions. UN control threatens this. What this new bureaucracy would clearly be able to do is restrict and censor websites and addresses, as well as place heavy regulatory burdens on their authentication, maintenance and pricing structure. This is a prospect no doubt relished by European social democrats who would like to extend their national content and industry policies across national borders.

Consider the countries most actively pushing for the UN takeover. Leading the charge is Iran, with Saudi Arabia, China, Cuba and Venezuela hot on its heels. None of these nations is known for their promotion of political, economic or social freedoms. Iran bans more than 10,000 websites on charges of immorality, and jails journalists and bloggers who disagree with the ruling elite. The "Great Firewall of China" has a similar effect. Should the internet be under the control of a network of regulators hammering out compromises about what is and isn't proper online activity? Member states in the UN run the gamut from the totalitarian to the democratic. Any attempt to assert control will result in an approach contrary to the liberal democratic ideals that dominate online activity. The internet needs the technicians of ICANN, not the policy committees of the UN.

From The Age, October 24, 2005

Pan-African Forum on Corporate Governance

The Third Pan-African Consultative Forum on Corporate Governance (PACFCG) will be held November 8-10, 2005 at Le Meridien President Hotel in Dakar, Senegal. The forum is being hosted by the West African Bankers Association and organized with the support of leading international and regional institutions including the African Development Bank, the Centre for Corporate Governance, the Center for International Private Enterprise, the Global Corporate Governance Forum, the International Finance Corporation, and the New Partnership for Africa's Development.

Good corporate governance is crucial not only for the effective internal management of companies, it also demands related public institutions and practices that support sustainable development, such as capital markets, disclosure rules, and accountability systems. The forum will include representatives from Africa's private sector and state-owned enterprises, policymakers, regulators, and leading corporate governance organizations experienced in effecting reform and building capacity. National, regional, and international institutions with an interest in corporate governance and the activities of the PACFCG will also be in attendance. Participants will: Discuss the current status of corporate governance in Africa;

Review key issues identified at the previous Pan-African Forum, including the role of banks, state-owned enterprises, and investors; Examine the issue of corporate governance in small, micro, and medium-sized enterprises and other structures such as cooperatives; Share lessons learned from different sectors of enterprise and society through country-level and corporate case studies; and Draft a list of next steps to advance the implementation of corporate governance principles. The forum will consist of panel discussions and breakout sessions as well as speeches and presentations by experts in the field. CIPE is a non-profit affiliate of the U.S. Chamber of Commerce and one of the four core institutes of the National Endowment for Democracy. CIPE has supported more than 800 local initiatives in over 90 developing countries, involving the private sector in policy advocacy and institutional reform, improving governance, and building understanding of market-based democratic systems.

From Accra Daily Mail, October 27, 2005

Good Governance Requires Good Public Service, Senior UN Official Says

In a world where internal and external pressures are forcing governments to redefine the role of the State, they are also grappling with ways to create a public service that provides responsive governance, greater openness and new partnerships with civil society, a new United Nations report says. Good governance needs, above all, a good public sector, Josι Antonio Ocampo, the Under-Secretary-General who heads the Department of Economic and Social Affairs, said at a news conference in New York as he introduced "The World Public Sector Report 2005: Unlocking the Human Potential for Public Sector Performance."

Summing up the main message of the report, he said: "There is no shortcut to building a quality civil service." Appointment by merit was the single most important factor in determining the quality, prestige and integrity of a public service, followed by an effective performance management system to develop staff, the quality of the country's public and political leadership and the professionalism and strategic planning of its human resource management, Mr. Ocampo said.

The challenges to maintaining a high-quality civil service included sustaining the pension system, especially in countries where the benefits have been generous, offering adequate pay to balance monetary and non-monetary benefits and coping with the "brain drain" as highly skilled personnel migrate, the report says. As the proportion of people over 50 in the global population increases to 30 per cent by 2050 and fertility rates decline, rich countries are trying to solve their personnel problems by outsourcing, or shifting some of their activities to countries where comparable labour is available at a lower price, according to the report. This intensifies the existing pressures on the civil service in developing countries to attract well educated, skilled recruits.

From UN News, October 26, 2005

Internet Governance Still Burning Issue @ Wsis-05

Following the failure to reach a consensus at the third Preparatory Committee meeting (PrepCom-3) held in Geneva, last month, Internet Governance would still be a burning issue at the second phase of World Summit on the Information Society (WSIS), just few weeks away. The second phase is scheduled to hold in northern African country of Tunisia, between November 16 and 18 at the Kram PalExpo, Tunis. This indication was given by the Communication Officer at the WSIS Executive Secretariat, Mr. Sanjay Acharya, saying that the summit would serve as the stage for key decisions on the future of Internet governance. He stressed that negotiations are anticipated to resume prior to the opening of WSIS and are expected to be lively, "as pressure to finalise the summit output documents would bring the remaining contentious issues to a solution.

Conceived as a "Summit of Solutions" he said, the Declaration of Principles and 15-point Action Plan developed at the first phase would be translated into tangible strategies during the event. These strategies, Mr. Acharya said, would be aimed at building a more equitable and inclusive Information Society (IS). He also informed that the second phase is billed to host about 12,000 participants from the United Nations agencies, Organised Private Sector (OPS), Civil Society Organisations (CSOs) as well as leading media entities globally. Mr. Acharya further said that some eminent personalities have confirmed attendance including the UN Secretary General, Mr. Kofi Annan. "Final preparations are now underway for arrival of an expected 50 heads of state and government," he said. In addition, the Communication Officer said that the summit would feature about 250 parallel events at the three-day plenary sessions. This, he said, would be focused on presentations and debates of relevant topics to the future development of Information Society.

From allAfrica.com, October 27, 2005

 
 

Nigeria Warns 'Corrupt' Governors

Nigeria's leading anti-corruption investigator says his agency is pursuing certain state governors who have been "stealing with impunity".
Nigeria's 36 state governors are immune from prosecution while in office. But Economic and Financial Crimes Commission head Nuhu Ribadu told the BBC his agency and the government were very serious about tackling fraud. He refused to name any state governors under investigation, or to indicate how many were suspected of wrongdoing.
Mr Ribadu said that many state governors had failed to grasp that Nigeria, viewed as one of the world's most corrupt countries, was changing. "Whoever is stealing is definitely being pursued," he told the BBC's Network Africa. "We believe there are a lot of them out there who are still not getting the message. People are used to stealing with impunity."

Help - Earlier this week, Mr Ribadu said he was seeking international help to return to Nigeria billions of dollars allegedly stolen by governors. Two of Nigeria's current state governors face legal proceedings in the UK, after being found with large amounts of cash in their possession. Bayelsa State Governor Diepreye Alamieyeseigha is currently being held in the UK, charged with laundering 1.8m Pounds ($3.2m) found in cash and in bank accounts. Last year, another Nigerian state governor, Joshua Dariye of Plateau State, skipped bail after being quizzed by police on money laundering allegations involving more than 1m Pounds ($1.7m). President Olusugun Obasanjo set up the EFCC after his election in 1999. Although a number of senior officials have been put under investigation for alleged corruption, there has not been any significant conviction during his six years in power.

From BBC News, October 17, 2005

Malawi President - Impeachment Will Not Stop Anti-Corruption Moves

Malawi's President, Bingu wa Mutharika, says a motion in parliament to impeach him will not stop his campaign against corruption. Addressing a church service Sunday, Mr. wa Mutharika said there are those in parliament who want to remove him from office because of his anti-corruption campaign. But he said no threat of impeachment would stop his so-called "zero tolerance" policy. On Friday, the speaker of parliament, Louis Chimango, introduced an impeachment motion charging him with ignoring the constitution in setting up his own party and with misuse of public funds. Mr. wa Mutharika, a former economist, has won praise from donor nations and aid agencies for his efforts to adopt economic reforms and stamp out corruption.

From Reuters, October 23, 2005

 

Government to Cut civil servant workforce by 10% over 5 years

The government decided Tuesday to cut the number of civil servants by 33,230, or at least 10% of its total workforce as of the end of fiscal 2004, on a net basis over the next five years, officials said. The plan includes cutting 5,549 jobs for fiscal 2005, which has been already approved, and 27,681 jobs from fiscal 2006 to 2009, the officials said.

From Japan Today, October 5, 2005

Civil Servant Jailed For Raping Daughter

A 34-year-old civil servant was sentenced to 11 years in jail and 12 strokes of the cane after he pleaded guilty before the Bandar High Court to raping his 14year-old daughter. Justice Datin Paduka Hayati heard from Prosecuting Officer Dk Hjh Hana Molina that the father of three girls had raped his eldest daughter at their house on two occasions. The two incidents occurred on October 13, 2004 and September 20, 2005 in the victim's bedroom.

From Borneo Bulletin, October 13, 2005

Boardroom Ethics Aren't for Everyone

Conflicts of interest and environmental considerations don't rate as core issues for boards that claim to consider ethical issues when making business decisions, according to a survey of the chairmen of Australia's top 200 companies. The survey, conducted by the Australian Council of Superannuation Investors, the lobby group for large super funds, drew a low response - 16 per cent - but ACSI said the sample size was big enough for it to make observations. The research was conducted by Professor Jack Flanagan of the Centre for Research into Ethics and Decision Making in Organisations (CREDO) at Australian Catholic University. Its aim was to discover what ethical values, if any, influenced board decision making with regard to governance practices and codes of conduct. But it appears many chairman were either too busy to respond to the survey or chose not to.

The study found that many boards, while talking about having a stakeholder focus, really only concentrated on a narrow group of stakeholders - their own investors. Other concerns, such as community interests, environmental concerns and even consumers, tended to be regarded as second grade. The majority of chairmen emphasised in the survey that ethics were at the core of all decision making and some stressed that the behaviour of all directors and staff should reflect the ethics of the organisation. "In summary, our findings suggest that ethics is firmly on the agenda of most companies, and that the right words are being circulated to soothe those who might be sceptical about directors' and executives' integrity," the ACSI report said.

ACSI executive officer Phil Spathis said "ACSI commissioned CREDO to undertake this research following a challenge posed by a prominent Australian board director to get to know boards better and to go beyond box ticking when looking at ethical and corporate governance issues within listed companies". A related research project into what is said in literature and reports about companies and major associations and institutes both in Australia and overseas found mutual funds that invest in companies with independent directors with good governance characteristics achieved superior returns over three-year and five-year periods. It also found that firms with stronger shareholder rights had, on average, higher values and higher sales growth.

But a majority of Australian chief financial officers believed the new corporate governance rules would not prevent a repeat of large corporate collapses. Among other findings, the interests of chief executives and shareholders tended to diverge as bosses neared the end of their careers and tended to concentrate more on their own financial futures. There also was no strong link between pay and performance at the executive level. While ACSI concluded companies made the right noises about ethics, concerns remained. "The survey revealed several contradictions in the way that ethics, mission statements and codes of conduct were being used," ACSI said. "There was an absence of clear evidence from which to verify that any company complied with its code of conduct. "There also appeared to be reluctance at board level to issue majority decisions, with consensus reigning supreme."

From Sydney Morning Herald, October 22, 2005

China Uncovers 240 Bank Corruption Cases in First Half: Report

China uncovered 240 cases of corruption in its state-owned commercial banks in the first half of the year, with losses totalling 1.6 billion yuan (198 million dollars), state media said. The Xinhua news agency, citing a State Banking Regulatory Commission official, said the money stolen from commercial banks from January to June amounted to about half of the country's total sum lost to bank embezzlement. About 25 percent of the cases involved more than one million yuan (123,500 dollars) each, Xinhua said. Shen Xiaoming, deputy director of the commission's supervision department, attributed the large number of scandals to bank reforms and improved government efforts to crack down on financial crimes.

The past year has seen an increase in the number of arrests and trials on corruption charges of bank officials, from branch managers to the vice chairman of the state-run Bank of China in Hong Kong. But the report revealed that graft remains a serious problem in China, even as the government pushes forward with reforms in hopes of getting the top banks listed overseas and improving overall management of the system. China has 189 banks and more than 30,000 credit cooperatives with total assets amounting to 30 trillion yuan (3.7 trillion dollars). The big four state-owned commercial banks - the China Construction Bank, Agricultural Bank of China, Industrial and Commercial Bank of China and Bank of China - have a combined market share of 55 percent.

In an interview published by Economic Information Daily Saturday, Shen said China would soon strip governors of state-run commercial banks of their power to approve loans, in a bid to prevent corruption. The power of top managers, approving loans without questions, is blamed for contributing to the large amount of non-performing loans in the banking system. Shen said the government wants to reduce the managers' authority to the equivalent of a university president. "Their future job is only in charge of administrative affairs, local marketing and business expansion," Shen was quoted saying.Shen said China's banks in future would adopt the practice of foreign banks and make decisions collectively.

Some Chinese state-owned commercial banks have already set up a loan-approval committee and bank governors are no longer allowed to directly take part in the loan approval process, Shen said. China's 2004 state audit report uncovered 9.06 billion yuan (1.1 billion dollars) in misappropriated funds at central government departments and 14.5 billion yuan in such funds by top state companies, prompting the state-run media to question the government's resolve in fighting corruption.

From AFP, October 24, 2005

Regulator Charged with Corruption

Concluding their probe into the "vultures" insider-trading scandal that has rocked the nation's financial community, Taipei prosecutors yesterday indicted a former top financial regulator on corruption charges. Prosecutors yesterday recommended an eight-year jail sentence for Lee Chin-chen, former director-general of the Financial Supervisory Commission's (FSC) Examination Bureau, for leaking confidential information about a government probe into Power Quotient International Co (PQI) to an investor who profited from the information. Prosecutors further say that a note written by Lee also proves that he attempted to profit himself. "Lee seriously damaged the government's image," Taipei District Prosecutors' Office spokesman Lin Ban-liang said yesterday. "[He was] an official in charge of monitoring the nation's finances, but used his office to commit a crime."

Lee was indicted for violating the Statute for the Punishment of Corruption and for offences against privacy. Lin Ban-liang said Lee leaked inside information to Lin Ming-da, an investor who he met with at least 36 times from January to June. Lee released a statement after the indictment yesterday claiming that he is innocent, and went to work as usual. Lee was transferred from his former post to serve as an FSC counselor after the scandal surfaced in July. Taipei prosecutors first launched an investigation into PQI in January, after the company posted suspicious revenue figures for last year. Prosecutors say that while those anomalies were under investigation, Lee on March 11 told Lin that PQI's headquarters would soon be raided. Lin immediately borrowed substantial amount of money against PQI to sell it short.

On March 15, according to prosecutors, Lee also told a reporter surnamed Ko from the Chinese- language newspaper United Daily News that PQI's headquarters would be searched in one or two days. Ko's article, which was published the next day, sent the firm's share price down, and Lin made profits. Prosecutors also said they found a note in Lin's office written by Lee on June 23, in which he asked Lin to borrow money against PQI's shares on his behalf. That discovery prompted prosecutors to launch a probe into Lee himself. But Lee, in his statement, says that the note he gave to Lin Ming-da in May was just part of the FSC's investigation into "vulture" groups that profit through insider trading.

The timing was after short sales in PQI were halted in April, and the note had nothing to do with the illegal trading, Lee said. Three investors, Lin Ming-da, Chen Chun-chi, Chen Yung-cheng, and a senior employee at the Taiwan Stock Exchange, Chang Hsi-kuan, were also indicted for violating the Securities and Exchange Law. Prosecutors said the five - who became known in the media as the "vultures" - made a total profit of about NT$15 million (US$444,000) from trading PQI's shares based on this information.

From Taipei Times, October 26, 2005

NA Deputies Discuss Proposed Law to Prevent, Fight Corruption

The way in which the proposed Law to Prevent and Fight Corruption, or the Anti-Corruption Law should work dominated debate in the National Assembly yesterday. Discussion ranged from identifying the property of State officials and the protection of whistle blowers to deciding which agency should have responsibility for enforcing the law. Many deputies argued that any entity given responsibility for the law should be controlled by the National Assembly or the Vietnam Communist Party. The Prime Minister should not be in charge, they said. National Assembly Chairman Nguyen Van An responded by saying that the Party leads the war against corruption, but neither it, nor the National Assembly chairman, should control the agency with responsibility for enforcing the law.

The effort to prevent and fight corruption should be taken by the Government and the Prime Minister, he said. Deputy Huynh Van Ti, central Binh Thuan Province, said: "We don't lack organisations to prevent and fight corruption. "But we lack the mechanism necessary to monitor and supervise activities for preventing and fighting corruption and we do not treat transgressors severely enough." The constitution identified the Government's responsibility to fight bureaucracy and corruption. Therefore, the Government should establish an organisation to do the job, he said. But the National Assembly should also appoint a committee to oversee the battle. Many deputies complained that the draft law would have State officials declare the property of their under-age children and this was not enough.

Deputy Huynh Thi Huong, central Quang Nam Province, said no one would use his name to register property illegally gained. Many officials sent their children to school in the major cities where they bought houses for them. Therefore, officials must declare the property of all their children, she said. Deputy Tran Huynh Men, southern Dong Thap Province, said accountants should also have to declare their assets because they were amid the opportunities for corruption. In addition, the State officials should have to declare scholarships for their children to study outside Vietnam and stocks held by their family members. Deputy Huynh Van Ti, central Binh Thuan Province, said the more public disclosure the better. Capital for hunger eradication and poverty alleviation and funds for people who have contributed to the revolution could also be embezzled.

As a result, all details about projects related to the people's right and benefit should be made public. Deputy Huynh Thi Huong, central Quang Nam Province, said the proposed law should be specific about protecting people who lay accurate accusations. Otherwise those accused would be able to victimise them. Deputy Duong Thi Loi, northern Bac Giang Province, said the draft law allowed for compensation to the accused by their accuser. But it did not deal with an accuser who was proven right and in danger. Deputy Huynh Van Ti, central Binh Thuan Province, said the possibility of revenge being taken against accusers was real and the Fatherland Front of Vietnam and its member organisations should ensure that those who made an accurate accusation were protected.

From Vietnam Net, October 26, 2005

Solomon Islands Chiefs Welcome New Team Investigating Corruption

The chiefs of east Are'Are coast villages of Malaita, in Solomon Islands, have welcomed the new Corruption Investigating Team set up by local police and the Regional Assistance Mission. The Solomon Islands Broadcasting Corporation reports, representative of the Chiefs, Constantine Iama'a, says the initiative is important in rooting out corruption at all levels. He has warned if the malpractice continues in government institutions it will have an adverse impact on government services meant for the people. Mr Iama'a says the corruption investigators are vital because the country needs legislators and officials to ensure public money is used properly.

From ABC Asia Pacific, October 26, 2005

China Ratifies UN Convention Against Corruption

To curb out-flowing of corruption officials who abscond with public funds abroad for evasion of punishment, China's top legislature Thursday ratified the United Nation's Convention Against Corruption in a unanimous vote. "The unanimous vote demonstrates the strong determination of the top lawmaking body to stamp out the prevailing corruption in collaboration with the international community," said Li Mingyu, member of the Standing Committee of the National People's Congress. With the approval vote by 157 member of the Standing Committee, China will become one of the first group of more than 30 countries to enforce the international law, which will go into effect on December 14 this year. The convention "is conducive to the repatriation of corrupt criminals fleeing abroad and the recovery of Chinese assets illegally transferred to foreign lands," Premier Wen Jiabao said in a bill submitted to the legislature on Saturday.

Chinese police authorities said that by the end of last year, more than 500 Chinese suspects of economic crimes, mostly corrupt officials or executives of state-owned companies, were at large in foreign countries. They stole away with them a total of 70 billion yuan (8.4 billion US dollars) of public funds, and only a fraction of them have been extradited back to China. The UN anti-corruption convention, adopted by the UN General Assembly in October 31, 2003, stipulates on the prevention, criminalization, international cooperation, assets recovery and implementation mechanism in the fight against transnational crimes of corruption. China signed the document in December in 2003. By September 15,30 countries have ratified the convention, which will goes into effect on December 14 this year.

The convention is consistent with China's anti-corruption strategy of putting equal emphasis on punishment and prevention of such a crime and has no contradictions with Chinese domestic laws in this regard, said Wu Dawei, vice-minister of foreign affairs. "Most importantly, it will provide a strong international legal basis for China to overcome the difficulties in investigating, extraditing criminal suspects of corruption and recovering Chinese assets in foreign countries," Wu said. China has been active in seeking international cooperation in fighting against corruption. Chinese prosecutors have captured a total of about 70 criminal suspects of corruption from abroad through legal assistance channels with foreign countries since 1998.

The successful extradition from the United States of a local branch head of the Bank of China in Guangdong Province in 2004 was lauded as the most powerful deterrence for Chinese corrupt officials, since the country used to be taken as the safest destination to escape from punishment. Yu Zhendong, the banker, misappropriated 483 million US dollars before fleeing to the United States. Chinese police have also seized more than 230 Chinese criminal suspects from more than 30 countries and regions during the period of 1993 to January this year with the help of Interpol, the international police body. Fan Xin, another lawmaker, told Xinhua that China should go on right now with the formulation or revision of its laws, including criminal code, statutes on money laundry and bribery in private sectors, to better adapt Chinese legal system to the UN anti-corruption convention.

Source: China View, October 27, 2005

 

'Police Corruption' Probe Begins

Detectives have begun a criminal investigation into alleged police corruption, as recommended by a High Court judge.
It follows a case in which the judge said there was evidence someone within the PSNI had undermined a firm which lost a vehicle armour-plating contract.
The contract ended up going to another firm at a much greater cost. The PSNI said its fraud squad had begun an inquiry which was being personally supervised by a senior detective. Sam Kinkaid, Assistant Chief Constable for Crime Operations, will be advised by an "external independent expert", the police added.

Some politicians had called for an outside force to investigate following last Wednesday's judgement. The Policing Board, which holds the PSNI to account, has asked for the chief constable to submit a report on the case by Thursday. The judge, Sir Liam McCollum, awarded 400,000 Pounds in damages to NI Sheet Metal Works Ltd. The Belfast-based company took an action for breach of contract after Firth Rixson Castings Ltd was awarded the contract, at an extra cost of 350,000 Pounds . The judge said once legal costs had been taken into account, the wasteful loss of public funds was in the region of 1m Pounds.

From BBC News, 17 October, 2005

A Civil Servant's Lot Is Not a Clear One

I have to admit that my knowledge of the civil service comes from watching repeats of Yes Minister. In my mind, the people who populate government buildings are grey-suited men bamboozling cabinet ministers with endless jargon and pointless meetings. And I don't think I'm alone in that respect. Aside from the bureaucrats themselves and - possibly - their political masters, few people have a clue about the inner workings of government. Which lends itself to the suspicion that all civil servants do is create more work for themselves, with meetings that only lead to more meetings, while administrators, supervisors and co-ordinators just administer, supervise and co-ordinate the growing ranks of civil servants. After all, the number at Holyrood has risen by 31 per cent since devolution to 4411. What do they all do?

Earlier this year, John Elvidge, Scotland's most senior civil servant, challenged any critic to spend time with staff to see how hard they work - arguing that every one of his workers was "fully and productively used". That's how I ended up, besuited, at the Scottish Executive's offices at Victoria Quay, ready to shadow the civil servants drafting the forthcoming Licensing Bill, which is due to go before the Scottish Parliament in November. The Bill aims to reform the licensing laws, tackle underage boozing and crack down on Scotland's binge drinking culture. Instead of giving every pub and club the same opening hours, the Bill proposes treating them on a "premises to premises" basis. All very laudable, but it's already been two years in development. What have they been doing?

I shadow Jacqueline Conlan for the day, the Executive's head of the licensing team, a civil servant with 13 years' experience. First stop Stirling, via public transport, of course - on this occasion the train, from Edinburgh. There we meet five suited figures and Jacqueline spends 90 minutes discussing terms such as "over-provision" with them. I hit the coffee. The one fact I do manage to glean from this is that most of these guys aren't happy with this nearly-completed legislation. It was, it transpires, a meeting of the Overprovision Sub Group of the National Licensing Forum - a group of pub chain chief executives, alcohol abuse charities, police officers, solicitors and licensing bosses who advise the Executive. They were scrutinising the paperwork to argue about what the effects of having too many pubs in towns and cities across Scotland could be.

Consultation meetings about legislation sound fine, for our open, in-touch, shiny Scottish democracy, but two years' worth? Apparently though, if the slightest thing is wrong with the Bill - if it isn't worded correctly - then it could create a loophole for pubs to exploit or could just end up as bad law. As a result, it can take years of work to get it right, particularly when every pub and club in the country will be affected. Back in Edinburgh, we'd missed lunch, so went straight into another meeting, this time with Jacqueline's team, their solicitor and draughtsmen - the guys who actually write the new law - for another technically-incoherent few hours.

Amendments and corrections needed to be made to the already sizeable document, and these were the people who had to come up with the suggestions for approval by their political masters - our next port of call. A quick drive to Holyrood and we were ushered into the study of George Lyon, the minister overseeing the Licensing Bill. Again, technicalities were discussed but this time they seemed to be far more direct, with simple yes or no answers on both sides. Hmm . . . I wonder why? By the end of the meeting, it was 6.30pm. But that wasn't the end of my day. At 11.30pm I rendezvoused with the team at a city nightclub. I was entirely suspicious that this late-night excursion happened to be on the day I was there - surely it couldn't be usual? - but they were adamant that this close to a piece of legislation's deadline, late working is the norm.

We were there for a tour of the club's security measures, such as CCTV. The point club owners are making is, if pubs are going to be allowed to open club-hours, they should be forced to put the same, expensive, measures in place. Fair enough, but did we have to be here at midnight to see it? So at the end of a very long day, can I honestly say civil servants earn their taxpayers' crust? When you understand little of the jargon, it's a difficult one to answer. Consultation is only worthwhile if the views being gathered are genuinely relevant, and a line has to been drawn somewhere. Just what was really achieved that day, I don't know. On the other hand, no-one wants loopholes in laws and rushed, botched legislation. The only thing I know for sure is that I'm glad it's not me who has to do it.

From Scotsman.com, October 14, 2005

Top Civil Servant Suggests Private Sector Recruitment

One of the State's most powerful civil servants has said the public sector should consider recruiting managers from the private sector to ensure people with the right skills end up in top positions. The Secretary General of the Department of the Taoiseach, Dermot McCarthy, called for a re-examination of how people were recruited into the public service. "We . . . need to look at our system and how we get the right people with the right skills into leadership positions," he said. "Recruiting from the private sector is a clear and attractive option." He also said the levels of change and productivity in the public sector should be benchmarked against those in the private sector, if salaries were to be benchmarked in this way. The benchmarking process justified a new approach to hiring management and rewarding staff, he said.

His comments at the weekend, at the Dublin Economics Workshop in Kenmare, come after weeks of controversy over wasteful public spending on private sector consultants. Mr McCarthy said that while the way the public sector did business had changed, this had not resulted in an equivalent improvement in "outputs" or performance. "It's not always evident that changes in processes have produced changes in outputs. This is in part because it's very difficult to measure output, but also because we have not put enough effort into both measuring and reporting on what is to be achieved. We need to stick with the development and fine tuning of performance indicators", said Mr McCarthy, who was speaking in a private capacity.

On measuring public service performance, the chairman of the Civil Service Performance Verification Group, Mr Donal de Butleir, said complex objectives and a lack of competition were hindering change management in the public sector. "If you have a choice, to change or go out of business then change becomes attractive. The impetus to change is absent from the public sector," he said. Mr de Butleir said many improvements had been delivered in recent years as a result of the Sustaining Progress - agreement in areas such as paying car tax, filing taxes, receiving social welfare benefits and obtaining passports. Promotions in the public service were increasingly based on competition, while the system of dispute arbitration had been greatly improved.

But he also said the scope of Government activity should be narrowed. "Government is in the business of making briquettes, growing trees, providing health insurance, selling gas, running buses and trains; running ports and airports; providing electricity; running greyhound races, running a postal service and a broadcasting service. "In my view, the public sector should concentrate on its key role as legislator and provider (or funder) of public goods and leave the provision of services to competitive markets as far as possible". Further action was needed in the public sector to manage performance and reward, control pension costs and improve accounting and information systems, he said.

From The Irish Times, by Marc Coleman, Economics Editor, October 17, 2005

Top Civil Servant Moves to Bank

The Bank of England has named a top civil servant, Sir John Gieve, as its new deputy governor. He will replace Sir Andrew Large on the Monetary Policy Committee (MPC) which sets interest rates. With the MPC closely divided on whether to cut interest rates, Sir John could tip the balance towards further cuts. Sir Andrew Large was one of the most hawkish members of the MPC, arguing that it was too early to conclude that inflationary pressures had eased. Blunkett scandal - Sir John Gieve is currently the permanent secretary at the Home Office, where he faced questions over the role of the civil service in the scandal which led to David Blunkett's resignation. He and other civil servants were criticised for failing to recall how the visa for Mr Blunkett's ex-lover's nanny came to be fast-tracked.

However, Sir Alan Budd, who led an inquiry into the affair, said he had no reason to believe anyone involved had deliberately withheld information. Sir John was knighted in December 2004. He has spent much of his career at the Treasury, where he was in charge of the first two spending reviews led by Gordon Brown, and has also been in charge of policy on financial stability. "Sir John brings a wealth of experience to the job," Mr Brown said in a statement released by the Treasury.' "He has held some of the most senior positions in government. He has extensive expertise of the financial stability and regulatory issues which form part of the remit of Deputy Governor."

Previously, Sir John had been tipped to be in the running to become the head of the civil service - a job that ultimately went to Gus O'Donnell, the permanent secretary at the Treasury. Civil servants - He is the second civil servant to move over to the Bank, following the appointment of Rachel Lomax as deputy governor. Sir John will replace Sir Andrew Large - former deputy head of Barclays - who resigned his five-year term at the Bank early in order to return to the City. Sir Andrew was among the most hawkish bank governors, voting to raise interest rates in 12 of the 36 MPC meetings he attended.

"Clearly the departure of the most hawkish member of the committee suggests a risk of a marginally more dovish balance," said Alan Clarke, UK economist at BNP Paribas. The Bank cut interest rates in August but has since kept them on hold, caught between the slowing UK economy and fears that higher oil prices will feed through to higher inflation. Bank Governor Mervyn King has warned that the Bank faces uncertain times ahead, and that the era of stable prices and high growth might be drawing to an end.

From BBC News, October 18, 2005

Khodorkovsky Lawyers Cleared of Ethics Abuse Charges

The Moscow Bar Association concluded Friday there was no evidence to disbar three lawyers of jailed Russian tycoon Mikhail Khodorkovsky's defense team for alleged ethics abuse. Earlier this month, the Prosecutor General's Office requested that Anton Drel, Yelena Levina and Denis Dyatlev be disbarred for "breaching lawyers' ethics" by refusing to represent the former Yukos chief in an appeal hearing instead of their hospitalized colleague Genrikh Padva. The prosecutors accused Khodorkovsky's lawyers of deliberately "dragging out" the appeal to enable their client to run for a parliamentary seat in a December by-election. The Moscow City Court rejected the man's appeal on September 23, but reduced his prison sentence from nine to eight years.

From RIA Novosti, October 21, 2005

Russia Tops UN's Oil-for-Food Corruption Report

The report into the corrupt UN oil-for-food program has named more than 2,500 companies from 60 countries that paid illegal surcharges and kickbacks to Saddam Hussein, with Russia being the country with the most companies involved, Reuters reported Thursday. The final report from the Independent Inquiry Committee aims to show how companies all over the world, as well as individuals and governments, rorted the program on a grand scale, sabotaging diplomatic efforts to bring Saddam under control. Russia was closely followed by France, the report says.The inquiry was led by Paul A. Volcker, former chairman of the US Federal Reserve Board. The report details how companies from more than 60 countries were able to evade UN controls and make money for themselves as well as for Saddam's government.

Executive director of the committee, Reid Morden, said: "The manipulation of the program, which led companies, entities and individuals to pay, directly or indirectly, surcharges and kickbacks will be the focus of the report." Illegal payments on oil and other goods are estimated at more than $1.31 billion, sources close to the investigation said. The surcharges on oil were finally stopped in 2001 by the United States and Britain in the UN Security Council. Previous reports from the inquiry, which has probed the $84 billion humanitarian program for 19 months, castigated UN Secretary-General Kofi Annan and other UN officials for mismanagement and faulted the 15- member Security Council for turning a blind eye to known oil smuggling outside of the program.

The operation, which began in December 1996 and ended in 2003, was aimed at easing the impact of the UN sanctions, imposed in 1990 after Baghdad's troops conquered Kuwait. It achieved considerable success in feeding Iraqis, and allowed Iraq to sell oil in order to pay for food, medicine and other goods. But illicit oil sale surcharges, kickbacks and smuggling schemes provided Saddam with access to hard currency. Iraq was allowed to write its own contracts and choose the contractors.

From The Moscow News, October 27, 2005

France Sets Up Ethics Committee for Diplomats

France announced Thursday the creation of an "ethics committee" for its diplomats after two former ambassadors were accused of corruption in the UN oil-for-food program for Iraq. "The case of the two former ambassadors should not be merged in the principles that our country has maintained in the Iraq war," Foreign Minister Philippe Douste-Blazy wrote in an article published by the French daily La Liberation. "The principles are based on the respect of rules of law and the values of tolerance and dialogue," he said, noting he has ordered the establishment of an "ethics committee" for diplomats in order to "avoid in the future any dysfunction."

France's former ambassador to the UN Security Council from 1991 to 1995, Jean-Bernard Merimee, 68, was put under investigation this month. Serge Boidevaix, 77, a former number two at the foreign ministry who carried the title "ambassador" was placed under investigation last month. Both are accused of "influence-peddling" and "active corruption of foreign officials" in breach of the oil-for-food programme which was run by the UN from 1996 to 2003 as a way of ensuring Iraq's sanctions-hit population had access to food and medicine through supervised oil sales.

They were reported to have received oil vouchers from Baghdad as compensation for their perceived sympathy towards Saddam's regime. Former Iraqi President Saddam Hussein is believed to have granted vouchers to individuals known to oppose sanctions against Iraq. These were then sold on for a mark-up to oil companies that were authorized to trade with Baghdad. The "oil-for-food" program, established by the UN in 1996 and terminated in 2003, was intended to allow Iraq to sell oil in exchange for food, medicine and other humanitarian needs for ordinary Iraqis who suffered from international economic sanctionsin the wake of the first Gulf War breaking out in 1991.

From China View, October 27, 2005

 

Disciplined Civil Servant Gets Bonus

Civil Service Commission disciplinary court finds former consul general to San Francisco guilty of scheming against subordinate, exploiting seniority, but Foreign Ministry appoints him to another prestigious post in U.S.; employee who filed complaint against consul general says, 'I do not believe such a person can represent Israel. It is very frustrating that he continues to do his job as though nothing has happened' - Vered Luvitch. Can a senior civil servant who was disciplined for scheming against one of his employees be permitted to hold a prestigious post in the U.S.? Apparently so: Yossi Amrani, the former Israeli consul general in San Francisco, was recently appointed to a similar position in another consulate in the U.S.

It all started when an employee in the Israeli consulate in San Francisco filed a complaint against then-Consul General Yossi Amrani, claiming Amrani had continuously schemed against him. "He was obsessive towards me," the employee, who agreed to speak under condition of anonymity, said. The employee was initially hired as the consul's clerk; he was later appointed to a higher-ranking position, but was eventually fired after he had spoken to Amrani about two job offers he had received from the Jewish Federation of San Francisco.

Amrani met with the Federation's director and told him the employee's performance level had dropped and that he had lost trust in the employee. Following the meeting the consulate fired the employee, claiming his performance level at work was deteriorating, that he lacked credibility and that he attempted to obtain a license to work in the U.S. 'What kind of message does this send to the public?' Amrani ordered that the termination go into effect immediately thereafter and instructed consulate staff to prevent the employee from entering the premises.

The worker's complaint led to an investigation, and last February Amrani was brought before the Civil Service Commission disciplinary court, where he was convicted, among other things, of exploiting his seniority, scheming against an employee and violating the Civil Servants' Ethics Code Law. The court withheld Amrani's salary for one month and froze his diplomatic ranking for nine months. However, the conviction did not deter the Foreign Ministry from recently appointing Amrani to the post of consul general in Houston - if only temporarily and informally.

Foreign Ministry spokeswoman Rachel Shani told Ynet in response, "The investigation into the matter did not find that Amrani harassed the employee, and his appointment to the Houston position is only temporary." "The Civil Service Commission's decision did not pose any constraints regarding Amrani's future posts," she added. The employee said, "I do not believe such a person can represent Israel. It is very frustrating that he continues to do his job as though nothing has happened." Attorney Eyal Shternberg, who is representing the former employee, said in response to Amrani's appointment, "What kind of message does this send to the public?"

From Ynetnews, October 10, 2005

Low-Salaried Civil Servant Rejects SR2 Million Bribe

Mohammad Saeed Al-Ghamdi, a low-salaried Saudi government employee in Jubail, has set an example for all civil servants by refusing a bribe of SR2 million. Custodian of the Two Holy Mosques King Abdullah commended Al-Ghamdi for his honesty and rewarded him with a promotion and a salary increase. According to a report carried by Al-Watan Arabic daily, a real estate developer offered Al-Ghamdi the bribe in order to establish ownership of land worth SR100 million. The bribe was offered while Al-Ghamdi was working at Jubail Court. "I did not want the SR2 million bribe because I know it is not lawful money. I will never feed my children with money from a bribe. If I had done what he asked, I would have felt guilty for the rest of my life," the paper quoted Al-Ghamdi as saying.

The developer selected Al-Ghamdi because he mistakenly believed that a man receiving a monthly salary of only SR1,500 would be easy to bribe. The developer wanted Al-Ghamdi to remove a document and make some changes to it. "The developer came to me and wanted me to do some paper work related to land he owned in eastern Jubail. I showed the document to the judge and he ordered me to compare it with the original. When I did, I found that the paper the developer had given me was not the same as the original. I planned to go back to the judge to tell him about it when the developer approached me and offered me SR1 million if I would use the fake document and complete the formalities. I asked for some time to think; then I went to the judge and told him about it. He informed the authorities."

Al-Ghamdi continued, "Four days later, the developer came back to me. This time he asked me to bring the original document so he could make the changes to it. I told him that was impossible and he then offered me SR2 million." Al-Ghamdi cooperated with the authorities who arrested the real estate developer. Officers had recorded the conversation between him and Al-Ghamdi and as a result, he is now in jail. "I found out that the land he was talking about was worth SR100 million and the reason he chose me to abet him in this crime was my low salary. He told me that if I helped him my life would change forever and improve completely," Al-Ghamdi said.

From Arab News, October 5, 2005

President Vows to Fight Corruption, Promote Justice

President Mahmoud Ahmadinejad here Saturday that vowed to fight corruption and rein in embezzlers of public finances. Speaking at a gathering of university professors and students, he added the government will carry on with revolutionary zeal and continue reforms in implementing development programs. "We are for kindness and compassion, but we will accept no considerations when the time comes for confrontation." He said the his election was due to culmination of a national will, adding "the government is not indebted to anybody and is preoccupied with the country's independence and national interests." Ahmadinejad also stressed the importance of justice in the ideology of the Islamic Revolution.

Elsewhere in his speech, President Ahmadinejad promised to deal with high tuition fees of universities and other higher education institutions. The president also castigated the current pervasive materialistic atmosphere prevailing in the society as hindrance to the achievement of the lofty goals of the revolution. There is no trade-off between economic justice and economic growth, he stated. "Justice means providing equal opportunity to all talented individuals," he underlined. Ahmadinejad also said fair distribution of incomes in the country is a "must." "Our views on justice is not superficial and sloganeering and that various establishments and institutions ought to be reformed," he said.

"We will definitely reform banking system and state-owned companies," he said. What has been done over the past 16 years were just contrary to the slogans chanted to justify the transfer of state-owned companies to the private sector, Ahmadinejad said. "We will strive to distribute the national wealth commensurate with the degree of deprivation in the regions," the president said. He also cautioned that the government has to tolerate heavy pressure in implementing its policies.

From Islamic Republic News Agency, October 23, 2005

 

Brazil Lawmakers Face Expulsion

The Brazilian Congress has begun expulsion hearings against 11 deputies accused of involvement in a vote-buying scandal that has hit the government. The former speaker of the lower house, Joao Paulo Cunha, is among those who could be expelled. He is a member of the governing Workers' Party, which is accused of buying the support of its coalition allies. The scandal has damaged President Luiz Inacio Lula da Silva's popularity. Two deputies had already resigned before the proceedings were announced. By doing so, they retained the right to run in elections.

If the other 11 are expelled as result of the probe, they will be banned from political office for eight years. The Workers' Party admitted that unofficial payments were made, but said it was common practice in Brazilian politics. Correspondents say the government hopes the disciplinary proceedings will draw a line under a scandal that has eroded its popularity. President Lula is hoping to run for a second term in next year's elections. He has not been implicated in the scandal.

From BBC News October 18, 2005

House Democrats Propose Ethics Reforms that Shun Sweeping Changes

House Democrats are pushing a plan to crack down on unethical behavior in state government that doesn't include more sweeping changes pushed by fellow Democrats. The proposal outlined today to a House committee would tighten disclosure and conflict of interest rules for all state and local pension systems. It also would strengthen requirements for state emergency purchases, clarify ethics rules for state employees and put new restrictions on naming rights at universities and state agencies. The plan doesn't include limits on campaign contributions pushed by the governor and other state officials. But House Democrats say it is just a framework for discussion as legislators return Tuesday for their fall veto session and they're willing to consider other ideas.

From Associated Press, October 24, 2005

Executives Talk Ethics to Students

The students, clad in blue jeans, shorts and red-and-white football jerseys, straggled into their personal-finance class. They barely noticed the tall, thin guy with snowy hair and a crisp white shirt, his button-down collar open at the throat. Rick Sharp waited quietly yesterday morning while the students at Mills E. Godwin High School in Henrico County settled into their chairs. But make no mistake: Sharp was on a mission. And he was not alone. Local high schools were invaded this week by more than 80 top-level business executives. Each one was ready to talk about ethics. The effort, sponsored by Junior Achievement of Central Virginia, reached about 2,000 students in Richmond and in Chesterfield, Hanover and Henrico counties.

Sharp, the chairman of CarMax Inc. and former chief executive of Circuit City Stores Inc., defined ethics as "doing what is right even when no one is looking, even if it costs more money." He used the corporate scandals at Enron and elsewhere to illustrate the widespread damage that can be unleashed by unethical behavior. "Because there were a few - really a very, very few - bad apples in the corporate world, Congress jumps in and passes all these rules and regulations," he told the 19 sophomores, juniors and seniors in teacher Hunter Thomas' class.

Honest companies, and their shareholders and employees, now pay the price for the misdeeds of a few, Sharp said. Some businesses are even being driven out of the stock market, making it harder to raise capital to finance growth and expansion. "That would not have happened if the people running companies like Enron had been ethical." Sharp offered some advice. "The way I deal with ethics is I try to put myself in the other person's position." His tip for financial success: "Find something you enjoy doing, work hard at it, be ethical, and the money will come as a byproduct." Anne Marie McHugh, president of the local Junior Achievement, said the response of the Richmond-area business community has been astonishing.

"This is the first time we've done this," she said. Her recruiting plan was simple. "We just sent out some letters." Next thing she knew, she was deploying dozens of heavy-hitting volunteers grocery-store moguls, Fortune 500 CEOs, accountants, lawyers, stock brokers, entrepreneurs, even Richmond Police Chief Rodney Monroe. Junior Achievement is a nonprofit group that works with young people to help them understand business and economics and appreciate the importance of free enterprise. At the Maggie L. Walker Governor's School for Government and International Studies in Richmond, David Williams told a dozen students in Ed Slipek's senior architecture class that ethics - sometimes - is simply common sense.

"Maybe it's just the old golden rule: Treat someone else the way you'd like to be treated," said Williams, managing director at Grubb & Ellis/Harrison & Bates, a commercial real estate firm. Sometimes it's more complex. To illustrate his point, he passed out the multipage code of ethics for architects. "You might think, 'How can I get it all right?'" Williams said. "You have to put it into day-to-day practice. Ethics to me is when you internalize it." Slipek's students said they discussed professional ethics in his class earlier this year. To an extent, ethical behavior springs from your personal set of beliefs, which may be formed well before graduating from high school, said James McCulla. P.K. Hunsaker sees gray areas, where the right approach may not be obvious. "Like most things, ethics are not absolute. There are special cases."

From Times-Dispatch, October 24, 2005

Louisiana Officials Bristle at Washington's Focus on Corruption

Louisiana has been painted broadly and regularly as a state teeming with corruption, a place where politics is a sport that many unethical, roguish and thieving people like to play. Now, the reputation that many of Louisiana's own residents reveled in - or at least joked about - is the state's albatross as leaders try to persuade the rest of the nation and the holders of the federal purse strings that Louisiana is worth repairing. The struggle was never more evident than last week when Gov. Kathleen Blanco, Lt. Gov. Mitch Landrieu and New Orleans Mayor Ray Nagin appeared before congressional committees asking for help to rebuild after Hurricanes Katrina and Rita, in a series of speeches that each included a defense of the state.

With several members of Congress openly suggesting since Katrina that Louisiana isn't trustworthy enough to handle billions of dollars in disaster relief aid, Blanco pledged accountability in spending. She said the state was hiring a nationally recognized accounting firm to review the flow of federal dollars through Louisiana and that she would hire another accounting firm to audit those first auditors. "I want to emphasize that the financial affairs of Louisiana will be transparent and wide open. I believe that we will stand well to expected scrutiny by the public, the Congress and the media," she told a meeting of House subcommittees that oversee the U.S. Army Corps of Engineers, the Environmental Protection Agency, FEMA and other agencies crucial to Louisiana's recovery.

"I expect to account for every single penny of federal money that is received by the state of Louisiana," she said. New Orleans Mayor Ray Nagin urged the lawmakers to Google his record. "You will see that since I have been in office almost four years, my whole focus has been on reform of government, honesty and integrity," he said. Louisiana's officials have been repeatedly trying to assure the White House, Congress, the national media and the public that they won't waste the financial help sent their way, that the state won't live up to its reputation. But they often add - somewhat bitterly - that New York didn't have to make such pledges when billions of federal dollars flooded into the state after the Sept. 11 attacks, nor did Florida after its multiple hurricanes last year. Louisiana's leaders are clearly angered by the distinction.

"All manner of ugly words have been used to describe us by people sitting in their ivory towers. We have moved a million miles, but our old reputation continues to haunt us," Blanco said earlier this month. And Landrieu was particularly straightforward when he appeared before the U.S. House committees with Blanco and Nagin. The lieutenant governor said Louisiana doesn't corner the market on public corruption, noting that seven states with members on those subcommittees had more public corruption convictions than his state did. In a letter he submitted to the subcommittees, Landrieu said New York, Illinois and Florida have twice as many federal public corruption convictions than Louisiana, and California has three times as many.

He said in the past decade, governors of New Jersey, Connecticut, Rhode Island, Arizona, Illinois, Ohio and Alabama all have been indicted - though he failed to mention that Louisiana's former four-term governor, Edwin Edwards, also is behind bars for a corruption scheme. "I question the political tactics of basically 'kicking our state' while it is down," he wrote. "Now, we come to Congress - the voice of the American people to seek help. And yet, in the media, at the office water cooler, at the family dinner table and even in the hallways of the Capitol, we have been made to feel corrupt, selfish and unworthy of aid."

The problem is Louisiana officials have gone to jail over the years. One of its congressmen currently is under investigation. Federal prosecutors set up shop before the hurricanes in the Orleans Parish school board offices. Jefferson Parish judges have been convicted recently as part of a wide-ranging corruption investigation. Unfortunately, the list tends to go on, so Louisiana officials will have to keep pleading their case - and promising to be more ethical and upstanding than many of their predecessors.

From The Associated Press, October 23, 2005

Ethics of Stem Cell Research Front and Center

Leon Kass speaks about life, cloning - A top Bush bioethics adviser kicked off a new series of discussions about the ethics of stem cell and other scientific research on Thursday (Oct. 20), tangling with Harvard faculty members over the meaning of life and of family, and over the limits that society ought to impose on itself. The discussion, at times brutally frank, centered on reproductive cloning, a procedure most within the scientific community firmly oppose and against which Harvard University has taken an official stand. Leon Kass, chairman of the President's Council on Bioethics from 2001 to 2005, presented a chapter of his 2002 book, "Life, Liberty and the Defense of Dignity: The Challenge for Bioethics," to the group, gathered for the lunchtime event in the Barker Center's Thompson Room.

In his presentation, Kass said that traditional human reproduction is tied into the essence of what people, society, and families are. Tinkering with that through reproductive cloning, he said, would diminish all three. He also warned that the use of reproductive technologies such as in vitro fertilization (IVF) desensitize society, making it more likely that extreme measures such as reproductive cloning will take place. "Thirty-five years ago, it would be inconceivable to all but a few, hard-nosed people that the early stages of human life would be a resource to be mined," Kass said. "Do it if you have to, but don't say [a human embryo] is not a living organism. Don't say it's just a bag of cells." Several faculty members applauded Kass' courage for agreeing to appear before what was a decidedly hostile audience. During the discussion, several faculty members indicated they disagreed with virtually everything Kass said or wrote on the subject.

Johnstone Family Professor of Psychology Steven Pinker was among Kass' harshest critics, saying he disagreed with "every single sentence" of Kass' chapter on cloning. Pinker said he believed that if reproductive cloning could be done without risk to the child the government shouldn't ban it, comparing it with the birth of identical twins, though at different times. Pinker took particular issue with Kass' assertion that a feeling of "repugnance" for certain scientific practices ought to be heeded, saying that repugnance has been used to justify misdeeds against Jews and as an excuse to ban many things now commonly deemed acceptable. "Time after time, the argument of repugnance has argued against things that are now morally acceptable," Pinker said.

The discussion, titled "Between Two Cultures," was the first of a series to explore the ethical and social aspects of scientific advances. The event was sponsored by Rothenberg Professor of English and American Literature and Language and Director of the Humanities Center Homi Bhabha; Bass Professor of Government Michael Sandel; and Cabot Professor of the Natural Sciences and Co-Director of the Harvard Stem Cell Institute Douglas Melton. Bhabha said there are issues raised by stem cell research that would benefit from a cross-disciplinary examination involving both the sciences and the humanities. "There's a very crucial constellation of issues to be addressed between the humanities and the sciences," Bhabha said.

In introducing the event, Provost Steven Hyman said though ethical issues have been raised by stem cell research, stem cells are "just the tip of the iceberg," with other scientific technologies raising similar questions. "Ultimately, these are questions about our very humanity," Hyman said. Kass agreed, applauding the event's organizers and saying the ethical discussion touches on issues of "immense importance." "These issues have been growing in importance since science first started coming to the aid of the human condition," Kass said. Kass said people's differences over these issues may be "unbridgeable" but that an important consideration is whether we can govern ourselves concerning them. In order to avoid reproductive cloning, Kass said he is willing to forego possible medical therapies and disease treatments if the technology used in them could also be used in reproductive cloning.

In vitro fertilization was held up as an example of a procedure once thought extreme and morally questionable that is done routinely today. Kass, who once warned against the use of in vitro fertilization, said that on reflection, he does not wish he could have prevented its use. But, Kass said, society has paid a price for the use of technologically intensive reproductive procedures, and he reminded his audience that he'd predicted in the 1970s, when IVF was first used, that it could lead to cloning. "We may not be aware of the price we pay for the blessings we have," Kass said. "It is increasingly possible to regard the child as a product of our will. Society is not the same for it. I think we have paid a big price for it."

With Kass emphasizing the importance of the natural bond between parent and child, faculty questioned Kass about his thoughts on adoption. He said that, though relationships between parent and adopted child are important once the child is in the home, the parent often goes through a sense of loss at not being able to have natural children before exploring adoption. Kass said the bitterness of the battle over these ethical issues around cloning has left the United States without a national policy on them. Scientists are suspicious of government's motives, biotech firms want as little regulation as possible, and opponents of the research don't want the nation on record with anything other than a total ban. "The U.S. is the outlying nation on this because most players are hostile to any kind of regulation," Kass said.

From Harvard University Gazette, October 27, 2005

 

Worst Corruption Offenders Named

Corruption is on the rise in some rich countries as well as poorer ones, research by anti-corruption watchdog Transparency International suggests. The group's Corruption Perceptions Index labels Bangladesh and Chad as the most corrupt places on the planet. The situation worsened in countries such as Costa Rica, Russia and Sri Lanka - as well as Canada and Ireland. But nations where perceptions of corruption are declining include Hong Kong, Turkey and even Nigeria. TI's survey asks businesspeople, academics and public officials about how countries they live in or do business with are perceived. The results are used to gauge how corrupt public officials are. The CPI does not deal directly with private-sector corruption.

Usual suspects? At both the top of the list and the bottom, the index shows little change from 2004. Topping the list, the cleanest countries are Iceland, Finland and New Zealand, with Switzerland not far behind. The UK is equal 11th with the Netherlands, with the US back at 17. Bangladesh and Chad - joint 158th - share the bottom end of the table with the likes of Haiti and Turkmenistan. Several other parts of the former Soviet Union also fare badly. Russia itself is joint 126th, while Georgia, Kyrgyzstan, Azerbaijan, Uzbekistan and Tajikistan rank even lower. Resource-rich African states are seen as particularly corrupt, the CPI says. Nigeria, Angola, Equatorial Guinea, Sudan and the Democratic Republic of Congo are all in the bottom 20. But Nigeria has managed to move up the rankings, from being ranked third-bottom last year.

TI said the survey demonstrated that the corruption continued to threaten development by hampering growth and putting off investors. THE BEST AND THE WORST - 5 least corrupt states: Iceland, Finland, New Zealand, Denmark, Singapore. 5 most corrupt states: Chad, Bangladesh, Turkmenistan, Burma, Haiti (Source: Transparency International). "Corruption is a major cause of poverty as well as a barrier to overcoming it," said TI chairman Peter Eigen. "The two scourges feed off each other, locking their populations into a cycle of misery." But although poor countries stood to gain the most from fighting corruption, TI said richer countries needed to take responsibility too, by investigating and prosecuting companies suspected of corrupt practices abroad and barring them from public contracts.

Action - Corruption has been high on the official development agenda for some years, but campaigners have often argued that governments only pay lip-service to it. Recently, however, attitudes appear to be changing. The United Nations Convention against Corruption comes into force in December 2005, enshrining in international law rights to pursue looted resources sent overseas. In the UK, the government's Commission for Africa has called for a much tougher line on the proceeds of corruption and their repatriation. Similarly, London's Metropolitan Police is working on an initiative to strengthen economic crime prevention, including anti-corruption activities, across the Commonwealth.

From BBC News, October 18, 2005

 
 

Osun State Embraces E-government

The Osun State government on Tuesday in Osogbo unveiled an expansive Information Communication Technology (ICT) infrastructure that is to usher the state into electronic governance (e-Government). The entire project consists of a bureau of computer service and IT, complete with Local Area Network (LAN) for e-Governance, an Internet access backbone with VSAT, Fibre optic inter-connectivity to all agencies of government, wireless radio inter-connectivity to remote agencies of government, fibre optic cable inter-connectivity to Internet-access backbone to official quarters as well as live streaming capacity website for radio and TV live broadcast.

The ICT project also has an official website www.osunstate.gov.ng through which people anywhere in the world could learn of developments in the state. The project and its components cost the state about N160 million to put in place. But according to the state Governor, Prince Olagunsoye Oyinlola the project would help government to save costs by eliminating wastage in time and resources.
The project also incorporates online documentation that will make access to important public information easy.

"Part of the package being commissioned today is the identity card scheme designed to combat the problem of the existence of ghost workers on the payroll of government. It has also enabled government to keep track of the records of service of its workers from time to time.
"One of the basic advantages of the identity card scheme is that authenticated staff records would henceforth form the basis for all personnel related matters, including the computerized pension scheme which has already started" said Prince Oyinlola.

The governor said one of the greatest issues that gave the administration concern upon its inception was the dearth of timely information, especially records of government activities which, no doubt, could adversely affect management decision making processes.
"As at today, I feel proud to state that Osun State government has successfully deployed and completed the first phase of its global computerization project.
"It is heartwarming to state that, government has been connected to the World Wide Internet Service via a VSAT, which guarantees continuous and uninterrupted communication between our State and the outside world," said Governor Oyinlola. The governor said that his government would also link all the 30 local government councils as well as higher educational institutions to the state's central information network.

In his welcome address, the state Commissioner for Finance, Alhaji Tajudeen Oladipo said various officers were already being trained to acquire the knowledge on the usage of Computer. He said with the Information and Communication Technology Infrastructure in place, Government would increase its participatory processes for transparency, probity and accountability in governance.

From The Sun News October 13, 2005

 

Knowledge Management Asia 2005

Running for its 5th year, the KM Asia conference has grown alongside the demands and needs of knowledge practitioners regionally. This year, KM Asia 2005 has taken one step further to address how knowledge management can improve your organisation's competitive edge. Headlined by three of the world's most admired thought leaders - John Seely Brown, Larry Prusak and Dave Snowden: KM Asia will explore the how KM plays a key role in the areas of innovation, organisational learning and productivity. Asides from exploring new frontiers in the economics of knowledge or developing sustainable innovative thinking, delegates will also find out how leading global and Fortune 500 companies, managed to successfully chart out their new paths with knowledge management as their cornerstone. For more information, visit www.kmasia.com

From Knowledge Board (at http://www.knowledgeboard.com), October 2005

Contract Research Industry Unaware of Gains from IT

The contract research business in India is estimated at Rs 480 crore and growing at the rate of 80 per cent year-on-year, according to a latest study. As the contract research industry grows at a rapid pace, the adoption of information technology by individual firms is also growing, the study released by Global Lifesciences and Healthcare practice of Tata Consultancy Services (TCS). Consolidated IT spending by the players in the industry, however, is less than one per cent of the total revenues. The report has pointed out that most players seem unaware of the potential gains from investments in IT in value chain. Most companies are in the level 1 of IT adoption with some presence of function specific applications in the overall value chain. Over 65 per cent of companies are implementing data management applications in some shape or form.

The contract research organisations surveyed for the study acknowledged that IT outsourcing will be helpful in the long run but were keen to see the IT industry introduce global practices of the CRO industry. However, no company seemed to be looking at complete outsourcing. Players in the industry are keen to implement knowledge management solutions in an effort to create and share institution al knowledge cost. The report identifies security issues and concerns about validation as impediments for adoption of IT initiatives among the industry players. The Report was developed over a period of six months covering 17 COntract Research Organisations including 13 domestic and 14 multinational companies across five cities. The sample adequately represented services offered by CROs such as Bioequivalence (BE), Clinical Operations (CO), Clinical Data Management among others.

From The Economic Times, October 23, 2005

 

Knowledge Management From BSI

According to Royal Dutch/Shell, knowledge management practice can be broadly defined as "the capabilities by which communities within an organization capture the knowledge that is critical to them, constantly improve it and make it available in the most effective manner to those people who need it, so that they can exploit it creatively to add value as a normal part of their work". Over the years many companies have informally been using many techniques to capture and share knowledge across their operations. There is now an increased focus on implementing more ordered and systematic knowledge management (KM) schemes.

BSI's David Keech said: "BSI is working with acknowledged experts, thought leaders and practitioners to produce current and up-to-date materials, guidance and other resources on KM. Such guidance enables businesses, government, and other organizations to make their own rational and informed assessments and decisions about KM". The benefits of investing in KM allows companies to provide:

- Better service and products for their customers
- Faster generation and application of ideas and innovations
- Access to industry best practices and best-in-class methodologies
- Access to competitor and market intelligence
- Access to internal and external networks of expertise
- Ability to deliver continuous learning
- Likelihood of lower cost administrative processes
- More efficient and timely marketing and communications
- Greater (cultural and linguistic) geographic reach
- Reduced loss of knowledge through staff turnover.

BSI (British Standards Institute) Business Information is about to publish three new documents on KM adding to the already well known PAS 2001 Knowledge Management: A Guide to Good Practice produced in conjunction with PwC. These are: -Skills for Knowledge Working: A Guide to Good Practice. Price 25 Pounds BSI order ref PD 7505 ISBN 0 580 46527 6; - Linking Knowledge with Other Organizational Functions and Disciplines: A Guide to Good Practice. Price 25 Pounds* BSI order ref PD 7506 ISBN 0 580 46526 8; - Knowledge Management in the Public Sector: A Guide to Good Practice. Price 25 Pounds* BSI order ref PD 7504 ISBN 0 580 46528 4. For more details on these three publications, visit www.bsi-global.com/KM.

From Managing Information (at http://www.managinginformation.com) October 11, 2005

Learning@Europe

Learning@Europe is a collaborative educational project that blends technology with traditional learning methodologies to enhance and motivate learning. The Learning@Europe experience is designed for secondary students between the ages of 14 to 19 years, irrespective of achievement level. Each experience includes 4 classes of students from schools in 4 European countries. Full details are available on the Learning@Europe website at http://www.learningateurope.net

From Knowledge Board (at http://www.knowledgeboard.com), October 8, 2005

Knowledge Economy Series: An introduction

Many opportunities, much competition and major challenges: eGov monitor explores the knowledge economy through perspectives from policy makers, influencers and other stakeholders in this series. Knowledge Economy, Information Society, "e" with everything, whatever label you attatch to it, the fundamental point is that the pervasive nature of technology is embedding itself into all aspects of our lives. It is changing our society, culture, outlook and expectations. Governments around the world have recognised this and are busying jockeying for position in the global Knowledge Economy.

The developed countries are investing vast sums of money and intellectual capital to "re-align" social, economic, cultural and political policies to ensure they are not left behind in the race to top the new world order. Fear of the potential of developing countries, in particular India and China, an aging population, work-life balance, future public expenditure/income, environmental concerns and a whole host of other issues are contributing to this inexorable shift away from an industry-based society. The developing countries are also racing ahead. For some, there lies the promise of wealth and global domination (again India and China), for others it is simply learning the lessons of the past and ensuring they do not get left behind.

The foundation for the Knowledge Economy is based not on geographical proximity to natural resources, rather the intellectual capital that all nations possess to a lesser or greater degree. The countries that succeed will be those that can maximise the potential of their citizens. In this series, eGov monitor examines the key challenges and opportunities from a British and European perspective, how these are being addressed and whether they are sufficient to sustain the continent's competitive advantage.

From E-Gov Monitor (http://www.egovmonitor.com/), October 10, 2005

PART 1. Knowledge Economy: Are We Ready to Capitalise on It?

The European Commission President, Josι Manuel Barroso, while launching the renewed Lisbon Strategy in February 2005 of "growth and jobs" stated: "...Our goal is to combine economic dynamism with sustainable growth, building a society with more opportunity for all." The "Knowledge Economy" is driven by high technology and is global in dimension. This new economy has provided limitless opportunities to continuously improve efficiency and create wealth across national and continental boundaries. On a public policy level, it has provided policy makers with the opportunities to forgo the false choices of return on investment or improving the quality of life of the workforce. The "Knowledge Economy" provides opportunities to do both and assist all parts of the society.

However, this new economy poses serious challenges to both UK and the European Union. While it is agreed by economists from all quarters, that the global economy including outsourcing has a net benefit impact on developed economies, it is a harder concept to accept for displaced workers who have recently lost jobs to India or China. In an ideal world, the displaced workers would be hired into higher paying more skilled jobs and overall competitiveness of UK would increase substantially. This can be achieved, as suggested by the Kok report of 2004[1], through proactive government involvement in setting and implementing strategies to ensure appropriate investment is made in developing knowledge, skills, innovation, higher education, in urban regeneration and in help for small businesses.

The UK has been at the forefront of developing the "Knowledge Economy" since 2000. The Government has recently launched its Digital Strategy[2] – a road map to ensure a sustainable information society in UK. However, there are serious challenges that we need to address and soon if we seek to capitalise on the opportunities of the Knowledge Economy. The time is now - Whatever the barriers to change, this change must happen now. It requires developing effective social and economic policies to support growth and jobs. As the Prime Minister has recently said in his speech to the European Parliament that social Europe and economic Europe cannot operate in distinct boxes and it is important for the political leadership to set policies that support the social and economic agenda of Europe.

The Prime Minister, as EU President has also called for action and urged EU members to "...implement the Lisbon Agenda. On jobs, labour market pariticpation, school leavers, lifelong learning, we are making progress that nowhere matches the precise targets we set out at Lisbon. The Agenda told us what to do. Let us do it". Higher Education Funding and Research - During the 1990's under the Clinton Administration, the US economy fuelled by technological innovation experienced unprecedented growth and all parts of American society benefited from it. One of the key ingredients of this success was the substantial research that was carried out in all sectors especially in the country's higher education institutions. Critically, this is where Europe lags behind.

It is not that we do not have superb scientists and researchers, but rather our Universities do not enjoy the sustained levels funding that higher education institutions in the US typically have. An alarming statistic is that the top 150 universities in the US have more endowment funds than any European University, which in turn makes it far easier for the US to attract the best researchers from around the globe. Many of these researchers are from Europe and most of them don't return to Europe and contribute towards our success.

What is more interesting is the fact that on a number international measures US school children lag significantly behind their counterparts in Asia and Europe, but when it comes to higher education, the US is the envy of the world. It is an accepted fact that only two or three universities in Europe fall within the top 20 Universities in the World – the remainder are all American. The British Government and the EU in general need to address this issue quickly as we are not only competing with the US, but as well as with countries such as India and China, who are catching up quickly. In reality, the Asian countries produce far more technology graduates than any other part of the world including the US.

Digital and Social Divide - In UK, we still have a significant part of the adult population who do not have the necessary ICT skills, our productivity growth faces challenges from developing countries such as India and China, and unless we manage this transformation to knowledge economy effectively there is a threat of a large part of our society being left behind. This has a potential of creating social divisions that would significantly harm the cohesion of our society. In the next part of this series, eGov monitor will present the thoughts and perspectives from the Director of the Prime Minister's Strategy Unit on UK's opportunities and challenges in the Knowledge Economy

Related Links: [1] "Facing the Challenge: The Lisbon strategy for growth and employment" http://europa.eu.int/growthandjobs/pdf/kok_report_en.pdf (512KB - PDF); [2] "Connecting the UK: The digital strategy" http://www.dti.gov.uk/industries/telecoms/pdf/digital_strategy.pdf (1.17MB - PDF)

From E-Gov Monitor (http://www.egovmonitor.com/), October 10, 2005

PART 2. Q&A: Stephen Aldridge Director Prime Minister's Strategy Unit

Dr. Stephen Aldridge, Director of the Prime Minister's Strategy Unit, highlights his views and sheds insight into UK's opportunities and challenges in the Knowledge Economy. Can you give us an insight into your role as the head of the Prime Minister's Strategy Unit (PMSU) as well as highlight the aspirations of the Unit? The PMSU provides the Prime Minister with strategy advice and policy analysis on his priority areas. My role is to ensure that we are clear about these priorities; that we have the people and resources in place to deliver the high-quality advice and analysis that the PM expects; as well as providing strategic leadership for the Unit.

The PMSU also: Works with departments to help them build their strategic capability; and conducts occasional strategic audits of the progress made by, and the challenges facing, the UK and UK government. More details can be found on the unit's website at: www.strategy.gov.uk

Question: The Strategy Unit recently released a comprehensive strategic audit of the United Kingdom. Can you provide a high level overview of your findings?

Answer: This was the second Strategic Audit – the first was published in 2003. It showed that Britain has made considerable and sustained progress in many key areas, including the overall performance and stability of the economy; closing productivity gaps; improving educational attainment; tackling child and pensioner poverty; substantially reducing crime; and improving health outcomes and the capacity of the NHS. But in other areas, the challenges are long running and structural, such as meeting the growing demands on transport infrastructure, ensuring enough houses are built, getting the hardest-to-reach groups back into work, and further improving the life chances of those born into the poorest households.

Question: Government is committed to developing a sustainable information society with opportunities for all in the UK. What do you perceive to be the key challenges UK faces in developing a sustainable knowledge society and how can they be best addressed?

Answer: ICT is central to developing a sustainable knowledge society. The UK has moved into the premiership of digital excellence. We now have one of the most competitive broadband markets in the G7. In early 2002 there were only 350,000 broadband subscribers. Now, 7 million addresses have broadband connections with a new connection being made about every ten seconds. Prices are falling, data speeds are increasing, and services are becoming more compelling.These developments combine to place the UK in a strong position internationally. However, a digital divide persists which prevents those from low income backgrounds from benefiting. To address this, the Government has set out an e-strategy that focuses on what ICT technology can do for informing and advising citizens, for supporting children, young people, and adult learners, and for transforming the experience of learning. It includes measures to:

Create an electronic portfolio for lifelong learning to support individuals in their efforts to develop new skills.
Ensure more opportunities for e-dialogue between parents and their children's school.
Encourage lease of laptops and PCs to pupils as evidence suggests that pupils who have access to computers at home have higher educational attainment than those who do not.
Set up a "Digital Challenge" for Local Authorities to achieve both excellence and equity in ICT.
Reform the Home Computing Initiative to boost the penetration of computers into the home and benefit those most in need of Government help in accessing ICT.
The Government will carry out a review in 2008 to establish whether further action is needed to close any remaining digital divide. The Strategy can be viewed at: www.dfes.gov.uk/publications/e-strategy

Question: What structural and regulatory reforms do you feel are necessary for the UK to take best advantage of the opportunities offered by the convergence of digital technologies?

Answer: The UK has one of the world's best regulatory environments for adapting to, and enabling, media convergence. The establishment of the converged media regulator OFCOM – which replaced five major regulators - has been praised worldwide for its vision and professional implementation. The recent Communications Act gives the new regulator the flexibility to respond to changing circumstances within a strong governance framework. OFCOM's early and well regarded moves on the Voice Over Internet Protocol (VOIP) for example – which lets people use the Internet for cheap phone calls - show that flexibility in action.

Question: How do you think the EU and European commission policies and directives affect the UK in building a sustainable knowledge society?

Answer: To realise the goal of creating an inclusive information society, the European Union has devised a variety of initiatives and policies which complement the UK's digital strategy. They include: e-Europe which aims to develop modern public services and a dynamic environment for e-business through widespread availability of secure broadband access at competitive prices; i2010, or 'European Information Society 2010' is a new strategic framework which aims to close the gap between the information society 'haves and have nots';
Structural Funds can be used to improve the telecommunications infrastructure and develop infrastructures such as broadband networks access, applications and services; Funding through EU framework programmes helps the UK to fund research for the media industries, such as digital TV and the promotion of take-up of new technologies; Under the Lisbon Strategy, the EU seeks out to ensure that every citizen has the skills needed to live and work in the new Information Society and to exploit the potential of ICT to overcome traditional forms of exclusion.

Question: Finally, what would you envision a strategic audit of the UK in 2010 would show if the Government is able successfully to implement the Digital Strategy?

Answer: The UK would be a world leader in digital excellence, with public services that are as responsive, personalised and efficient as those offered by the leading companies that have successfully deployed the Internet to serve their customers. Consumers will have been protected from the dangers of the "darker side" of the digital world. We will have used ICT to minimise social exclusion and to ensure that the UK has become the first nation to succeed in closing the digital divide – particularly for families with children.

From E-Gov Monitor (http://www.egovmonitor.com/), October 10, 2005

Sun Powers Belgian E-Government Electronic Identity Card Program

Sun Microsystems (Nasdaq: SUNW) today announced it has successfully demonstrated to the Belgian Federal Government ICT (FEDICT) the integration /interoperability of the Belgian Electronic Identity (eID) cards with multiple Sun products. Based on Java Card(TM) technology, the eID cards provide Belgian citizens with identification, strong authentication and signature capabilities. Belgium's eID initiative is helping to improve government efficiency, reduce paperwork and make interactions with Belgian citizens quicker and more secure. Currently, more than 1 million Belgians have eID cards and additional cards are being issued at a rate of 150,000 cards per month. The Belgian government estimates that by the end of 2009, 8,2 million citizens age 12 years and older will have eID cards, based on Java Card technology, allowing them to access enhanced government and enterprise services.

Belgian citizens can already use the new eID card for identification, authentication and authorization for many public facing services, including: secure online tax form declaration, official document requests (marital status, birth certificate, etc.), electronic submission of court case conclusions, as well as access to the public library, swimming pool and other community services. The eID card infrastructure can also be used by enterprises to secure their electronic applications and services. Technology vendors are teaming with Belgian companies to develop applications using the eID infrastructure to provide additional services like more secure online ticket purchases, online opening of e-commerce accounts and as a qualified signature for contract signing.

Sun has demonstrated the integration/interoperability of the Belgian eID card with the Solaris(TM) 10 Operating System, Sun Ray(TM) ultra-thin client and the Sun identity management platform. The integration with the Sun Ray ultra-thin client provides desktop mobility using the eID card and complements the Sun (SM) Secure Network Access Platform solution. Peter Van Van Velthoven, Secretary of State for Information of the State in Belgium welcomes Sun Microsystems' initiative to provide eID Card integration through Sun identity management technologies. P. Van Velthoven explains, "By demonstrating the eID integration with the Sun identity management platform, Sun is contributing to secure web applications and services used by the citizens."

The integration with Sun Java System Access Manager, a key component of the Sun identity management platform, will provide a solution to help companies secure their web applications by offering strong access controls for eID card users. Sun Java System Access Manager provides certificate based strong authentication with the eID card for accessing web applications and real-time validation of the citizen certificate within the Public Key Infrastructure (PKI (1)) of the Belgian government.

"Belgium is considered the most advanced deployment of eID cards, based on Java Card technology, by a single government entity in Europe. Sun sees the Belgian eID project as key enabler for the deployment of identity management solutions for the government and for enterprises. Several European countries are closely monitoring what is happening with the Belgian card (UK, Spain, France, Portugal). We are sure that the deployment of the eID card and the implementation of the PKI by the Belgian government will gain additional recognition for Belgium as a country that is pioneering secure access to critical information for its citizens," said Luc Opdebeeck, Managing Director, Sun Microsystems Belux.

From PR Newswire, October 18, 2005

State Falls Short in 60% of E-government Projects

Almost 60 per cent of technology projects given priority status by the government three years ago have yet to be implemented, were not finished on time or have been scrapped. Just 29 out of 70 flagship e-government projects have been finished on schedule, despite significant government investment into a host of technology systems, according to analysis conducted by The Sunday Business Post. In 2002, the government published the strategy document New Connection, outlining what e-government services should be given priority and setting out a definitive timetable for their implementation.

However, it has emerged that government departments and state bodies have not met the specified targets in 41 of the 70 initiatives. While many were completed after their initial deadline, as many as 20 are still not finished or have been put on hold. The initiatives, which range from applying for a driving licence online to the controversial integrated service project for the Department of Health, were described by the government in 2002 as "central to how we evolve as an information society''. The Department of Education was charged with implementing four e-government projects. Of those, just one has been implemented on time, while a system allowing the payment of student grants online and a "further education management information system'' have been deferred.

The Department of Foreign Affairs was due to have a facility enabling people to apply for a passport online by the end of 2003. However, that project has stalled due to problems over security and electronic signatures. The Office of Public Works has fulfilled its obligations, although three of its four initiatives were late, while the fourth, online viewing of the state art collection, has been introduced in a limited form due to copyright issues.

From ThePost.ie, Ian Kehoe, October 16, 2005

UKvisas Picks Up Top E-government Award

UKvisas, the joint Foreign Office/Home Office unit running the UK's overseas visa service, has been awarded a prestigious e-government award. The unit picked up the National ICT Innovators category in the DTI E-Commerce Awards for their on-line visa application system, Visa4UK. The award was presented at the National DTI E-Commerce Wards ceremony in London on October 6. Lord Triesman, Foreign Office Minister responsible for visa issues, said: "I am very proud that Visa4UK has won this award. It recognises the hard work and innovation that has gone into developing this system to improve the efficiency of our visa operation.

"It has helped to make our visa application system faster, easier to use and more accessible. It is a triumph for a highly dedicated team." The system was initiated in 2002 and has been rolled out across 27 Embassies worldwide, with two more due to be added before the end of October 2005. According to the Home Office, development of many aspects continues, including work to improve accessibility of the website for the visually impaired.

From Jon Land, 24dash.com, Oct ober 14, 2005

 

Steering Committee Reviews Progress of e-Government Projects

The UAE e-Government steering committee, chaired by H.E. Dr. Mohammed Khalfan bin Khirbash, UAE Minister of State for Finance and Industry, recently discussed the current progress made in the e-Government project and reviewed the 2006 plan for this major initiative. The meeting focused on some foundation projects such as e-Portal, Messaging, and also discussed ongoing e-Projects, such as the Human Resources Management System (e-HRMS), the Ministry of Agriculture and Fisheries e-Government implementation plan and the Financial Management Information System (e-FIMS).

At the conclusion of the meeting Dr. Khirbash welcomed the progress that was made. 'It is evident from today's meeting that the committee and various teams involved at the implementation level are making real headway in their efforts to bring the e-Government project to fruition. What we have achieved by implementing some components of this vital project reflects the depth of the commitment of everyone involved and our determination to move into e-Economy and e-Society.'

The e-Portal, the UAE government electronic gateway, will see the launch of its Content Management System by November 2005. In addition, thee-government project team will hold individual meetings with ministries to assist in the adoption of new standards for government websites. The team will also work to develop web sites for other ministries while conducting workshops and seminars to increase awareness. 'Our aim is to achieve a world-class UAE e-Government with cutting edge ITC technology. This objective complements our efforts toward bringing higher performance and efficiency standards to government, and enhances our efforts to provide the corporate sector and individuals, UAE nationals and residents, with up-to-date solutions for any anticipated problem,' added Dr. Khirbash.

The e-Projects spearhead by Ministry of Public Works has launched its first eservice-eQualification, and is expected to launch other eservices, eQuality and eEvaluation this December. The fifth and sixth services to be offered under the e-Projects umbrella in 2006 are the Project Initiation Workspace and eCompetition. e-Projects is a budgeting and tracking tool for Federal Government projects. This project will enable the Federal government to access, monitor and manage infrastructure and building projects through a central system. It will also enable it to report accurately on project progress, management and financing.

The e-HRMS team held a number of meetings and workshops to ensure stakeholders are informed about the project. System requirements have been identified and two services will be launched in October and December. These are the electronic legislations and laws, and MyInfo Prototype. e-HRMS will allow the government to better manage its human capital when it becomes fully operational. The system will allow for the management of government employment on the macro and micro levels, covering all areas from demographic influences to workforce mobility and the identification of skill shortages.

The committee also reviewed progress made in the FMIS that will ensure unified financial and accountancy procedures for all government transactions. In November and December 2005, the FMIS team will be training personnel from the federal ministries and will test the system in the Ministry of Finance and Industry. In early 2006, FMIS will be launched officially across the federal ministries. FMIS facilitates the design and implementation of budgets programs to each ministry together with the appropriate financial resources. FMIS is regarded as one of the main pillars supporting performance based budgeting as it strengthens auditing and financial oversight.

Also reviewed at the meeting was the progress made by the Ministry of Agriculture and Fisheries which already offers 97 of its total services electronically and has launched a website with related comprehensive details. The Ministry is currently implementing the 'knowledge Management' and full automation projects. The e-Government project has been designed in such a way as to allow the government officials responsible for the project to implement the programs and systems in structured 'wave' stages. Each wave of changes has its own milestones and benchmarks. Projects can span more than one wave or overlap. The initiative was introduced as a tool to improve the efficiency and effectiveness of the UAE Federal Government and is a key component in sustaining the country's competitiveness.

From AMEinfo.com, October 17, 2005

 

North Carolina Knowledge Management Organization Formed

Charlotte - John Barrett, principal of ITI Associates, a collaboration and knowledge management consulting firm, is leading the formation of a new Knowledge Management organization in North Carolina. The Knowledge Management Network of North Carolina (KMNNC) has been formed to promote the sharing of Knowledge Management (KM) best practices, to provide a forum for group learning and discussion about KM and to encourage networking and professional collaboration in the area of KM. The initial KMNNC event is scheduled for Oct. 27, 7 p.m., in the Sharon Room at the Charlotte Westin Hotel, 601 S College Street, Charlotte, NC 28202.

The meeting will coincide with the 2005 International Conference on KM (http://www.ickm2005.org/) being held at the same hotel on October 27 and 28. This free event will give those interested in KM from NC and surrounding states an opportunity to network and have a dialog about the direction and focus of KMNNC.You can join by visiting http://finance.groups.yahoo.com/group/KMNNC/. Barrett remains an active member of the executive committee of the Philadelphia KM Group, where he resided prior to relocating his firm to North Carolina in 2004. "The North Carolina group will be patterned after the the Philadelphia group, the third oldest KM organization in the country, formed in April 1999," Barrett says. "Attendance at the Philadelphia group's monthly meetings is around 40 people," he adds. Barrett's expertise in knowledge management (KM) led him to create ITI Associates, a firm devoted to helping organizations share, capture and leverage what they know.

ITI Associates helps businesses accelerate informal learning, improve collaboration among work teams, identify and use lessons learned, preserve organizational knowledge when employees leave, and other business knowledge issues. Barrett writes and speaks frequently about collaboration and KM issues. He is the author of a recent book chapter on Collaboration, serves as editor of a periodic KM newsletter, and continues to speak at numerous seminars and conferences, including the upcoming ICKM conference in Charlotte on October 28th where his topic will be Collaboration: It Just Doesn't Happen. For more information about collaboration and knowledge management, visit the ITI Associates web site at www.iti-associates.com.

From dBusinessNews, October 10, 2005

 

Partnership: The New Way Forward for Outsourcing

eGov monitor explores the "consortia" trend in public sector outsourcing projects highlighting it as an opportunity for the private sector to add value to the Government's efficiency agenda. In the past couple of years, there is a growing trend to award large-scale public sector outsourcing projects to a "consortium of suppliers" rather than a single provider. Recently, the MoD announced it was awarding its mammoth £4 billion defence information infrastructure (DII) to a consortium led by EDS. Whether you look at NHS or Inland Revenue's "Aspire" it seems that consortia approach to outsourcing major projects is growing in popularity.

This reflects an understanding and acceptance by both the public sector and the supplier community that successful delivery on projects on a mammoth scale will most likely require expertise beyond a single supplier's organisational resources or capabilities. Any organisation, like an individual, cannot realistically be an expert at everything. A consortium arrangement is a way of skirting the issue of "jack of all trades, master of none". Similarly, we see more of these projects being broken down in incremental phases, where the existing consortium has to meet the performance targets before they are awarded the next phase.

This is a good example where the public and the private sector are working together to define and deliver measurable value and drive forward the efficiency agenda of the UK government. This also leads to a better supplier-client relationship management environment where both parties are working together to develop realistic business goals and service level agreements and not take a "us" and "them" approach. For the public sector, the consortium approach and working in partnership with suppliers has many benefits. First, with regard to the close monitoring every public sector project faces from the public, press and Parliament, it is important for the public sector professionals to establish transparent and realistic parameters for project management.

Second, the whole consortia approach is far less risky - as the public bodies within the framework of a single contract are getting access to more professional resources and expertise necessary to successfully deliver the project. Also, public sector managers will only require a single point of contact through the lead supplier responsible for the overall management of the project. Third and finally, this approach allows public sector managers to captialise on the strength of individual suppliers in specific areas rather than be saddled with the strengths and weakness of a single supplier across the board. The members of the consortium can be selected to ensure that the required expertise is available to all aspects of the project.

The contributions of the supplier community towards ensuring better value for their public sector clients must not be neglected either. Competitors are working together on projects while competing on others based on requirements, expertise and organisational knowledge. This willingness to work together sends a strong signal to the public sector community and the public at large that the private sector is fully committed to adding value to the government's agenda to gain efficiency and improve public service delivery through ICT.

It must be accepted by all that this just the beginning and these consortia along with their public sector clients are under the spotlight to deliver successfully on these projects. Outsourcing in the public sector is a reality now and as a supplier to the public sector that has been under the spotlight, the MOD deal provides an excellent opportunity for EDS to reassert its leadership and demonstrate how the private sector can add value to the public sector's drive towards a more efficient and effective government.

From Gov Monitor, October 3, 2005

 
 

Bhisho in R52m Grants Fiasco

Taxpayers will have to foot this huge bill for legal costs. "The department must stop using the courts as a delaying tactic to give it more time to process social grant applications". UNWILLINGNESS or inefficiency on the part of the Eastern Cape Social Development Department to manage the social grant system has landed taxpayers with a R52 million bill for legal costs. The department's failure to pay out legitimate social grants had forced thousands of needy citizens to appeal to the courts for social assistance. The resulting court costs have been R52m since 2001. And Rhodes University's Public Service Accountability Monitor (PSAM) researcher Tracey-Leigh Joseph has found that current evidence from court rolls indicates the figure will rise in the foreseeable future. In a recent social grant litigation case, Acting Judge Keith Matthee noted that the response of the department to the case had been "breathtaking" because of its "failure to grasp the duties placed on it by the Constitution".

In a hard-hitting report, Joseph said the costs were incurred because the department appeared to be using the courts to allow it to have more time to process social grants. Litigation had become the only way that needy citizens had access to their grants, she said. "The action, or more generally inaction, of the department is unconstitutional because the Constitution states that all citizens have the right to administrative justice which is 'lawful, reasonable and procedurally fair'." PSAM said Social Welfare needed to take its accountability obligations seriously and to act in a way that was consistent with the Constitution. In a serious indictment of the department's functions, Joseph said "the department has to be brought to court in order to process grants, rather than attend to them in the ordinary course of its day-to-day functions as it is constitutionally mandated to do".

Joseph said the money spent on litigation was not budgeted for and had to come from the budgets of the department's core programmes - compromising its ability to meet its mandate of assisting the poor. "The department must stop using the courts as a delaying tactic to give it more time to process social grant applications," wrote Joseph. It should meet its mandate by processing grants internally, rather than forcing the neediest of citizens to resort to litigation in order to access the said grants. PSAM said that, in terms of the Public Finance Management Act, the costs associated with such tactics could be defined as "fruitless and wasteful expenditure". By allowing such costs to accrue against the department, the accounting officer of the department is, in fact, committing financial misconduct for which he/she should be disciplined.

PSAM said department staff should be warned that courts of law were entitled to award costs against the defaulting official personally. Joseph highlighted a media briefing earlier this year during which former Social Development MEC Neo Moerane-Mamase attempted to explain the department's position with regard to social grant litigation. According to Moerane-Mamase, the department had been making a concerted effort to deal with court cases, which, she claimed, had resulted in a decrease in the number of cases brought before the courts. "Despite these assurances, High Court rolls in the Eastern Cape are still clogged with cases involving litigation between social grant applicants and the department," found Joseph.

PSAM said there was little doubt that the crisis of social grant litigation would continue. "Little will change in the province if structural weaknesses relating to staff shortages and infrastructural backlogs are not speedily addressed," wrote Joseph. Social Development spokesperson Gcobani Maswana was out of the office and could not deal with the Daily Dispatch's request for comment. MEC Thoko Xasa's office said she was also not available but an attempt would be made to obtain departmental comment. At the time of going to press no comment had been provided.

From EDDIE BOTHA, October 28, 2005

Probe Finance Minister - House Committee

Public Accounts Committee of Parliament has recommended that Minister of Finance Goodall Gondwe be investigated for abuse of office and also that the President and Cabinet should refund before the end of the year K2.8 million used to fund political activities. Presenting a report on the investigations into the operations and management of Credit Scheme Account in the Ministry of Finance, the committee's chairman Respicious Dzanjalimodzi observed that lack of a majority in Parliament put the Executive under pressure to use public resources to have support. "The committee further recommends that the former Minister of Education Honourable Yusuf Mwawa and the Minister of Finance Honourable Dr Goodall Gondwe should be investigated for abuse of office in facilitating financial transactions that were tantamount to defrauding public finances," said Dzanjalimodzi.

He added: "The President and Cabinet should refund the sums of K300,000 and K2.5 million corruptly used in the political and clandestine operations and provide documentary evidence through the Accountant General before the end of this calendar year." The report among its 10 recommendations also said Ministry of Education officials who were responsible for disbursement of funds to MPs should be investigated for theft and forgery allegedly committed in the course of paying bribes to the MPs who were targeted for wooing. According to the report, some MPs who had their signatures on the payment vouchers did not actually sign for or receive the money. The committee noted that the alleged abuse of funds started when government, during one of its meetings chaired by the President, formed a task force to handle programmes aimed at enticing MPs to support government. Mwawa was appointed convener of the task force.

Other members of the task force were Ken Lipenga, Minister of Labour; Foreign Affairs Minister Davis Katsonga; Agriculture Minister Uladi Mussa; Health Minister Hetherwick Ntaba; Henry Phoya, Justice Minister; Attorney General Ralph Kasambara; Elizabeth Aipira, Deputy Minister for Statutory Corporations; Minister of Home Affairs, Anna Kachikho; Frank Mwenifumbo, Deputy Minister of Irrigation; Henry Mumba, Deputy Minister of Agriculture; and RP MPs Aaron Sangala, Good Kayira, Steve Malamba and Abbie Shawa. Dzanjalimodzi said the committee established that following a request from Mwawa, the Ministry of Finance transferred K5 million to the Ministry of Education's Special Client Account for the task force of which part of it was used to pay chiefs to influence their MPs for support. "The money was for allowances, transport refund, accommodation and other transactions relating to the functions of the task force. Chiefs too had to be palm-oiled with a view to getting their assistance. The money was also meant for lobbying MPs," observed the report.

The report however said some of the money from the K20 million was later returned to the consolidated funds. The report also indicated that some of the money was used in the establishment of the Malawi Rural Development Fund (Mardef) loan although it established that government finance management rules and regulations were not followed in the opening of the account. The report however, noted that during interviews Gondwe indicated that he was not party to the transactions of giving money to Mwawa and that when he queried why money was being transferred in cash he was asked by Kutengule to keep away from the matter. Gondwe is also said to have advised Kutengule not to deal with a request from Mwawa for money for promoting government business in Parliament. The report, however, said Mwawa told the committee that all what he was doing was with the blessing of the task force.

Mwawa disclosed that for the task and on request to Gondwe he was given K300,000 and K5 million. "Hon. Yusuf Mwawa emphasised that he was working closely with the Minister of Finance Hon Goodall Gondwe," reads the report. Mwawa is also said to have told the committee that after the issue came out he was promised by Mutharika that he would handle it. "In conclusion Hon Mwawa stated that he never knew anything about the activities of Dr Kutengule, since he was dealing directly with his colleague, the Minister of Finance Hon. Gondwe," said the report. Kutengule was arrested last week and charged with theft by public servant in connection with his opening and single-handedly withdrawing cash from the K20 million Credit Scheme Account. Part of the funds were used in the Ministry of Education Special Client Account. Mwawa is also answering charges of theft after he is alleged to have paid for his wedding bills at a hotel from the Special Client Account. But soon after presenting the report government protested against debating the report since the matter was now in court and after a long debate, Speaker Louis Chimango reserved his ruling but stopped debate on the matter.

From Nation Online, October 28, 2005

 

Vietnam Pledges More Transparency in Public Finance

Vietnam is committed to improving transparency and openness in public finance policies, heard an international forum hosted in central Vietnam Oct. 14. "Vietnam has pursued public finance management reforms with the utmost aim of enhancing openness, transparency, and efficiency as well as democracy in State budget administration," said Nguyen Duc Kien, chairman of the Vietnam National Assembly's Economy and Budget Committee at the forum.

Parliamentary representatives from India, Cambodia, Laos, Czech Republic, Denmark, Hungary, South Africa, New Zealand, Australia and Sweden and international organizations attended the forum on the role of parliamentarians in public finance supervision. The country also aims to assign agencies and organizations with specific rights and responsibilities in public finance management, Mr. Kien added. "Vietnam is well on its way to fall in line with international rules on the issue," he said. Issues related to public finance reforms in other countries were also discussed at the forum.

From thanhniennews.com, Xuan Hoa, October 15, 2005

Vietnam Modernizes Public Financial System

Many factors have built up an ideal infrastructure for Vietnam to develop a modern public financial system, said foreign experts at a recent high-level forum on public finance in Central Vietnam. Perran Penrose, a budgetary expert from Britain, who has been working for ten years in Vietnam, described the country's budget estimating system, which is based on input-output balance, as a progressive decision that many other economies should follow. He told the Vietnam News Agency that by signing budget allocations to the leaders of agencies, the Government was giving agencies more independence and autonomy in budget spending.

This was a difficult first step that Vietnam had overcome to advance towards modern state management and spending in line with the world trend for reforming public financial system, the British budgetary expert said. Meanwhile, Jan Bergqvist, former Director of the Swedish Parliament's Finance Committee, said many countries have envied Vietnam for its budget estimating system, which has often seen budget spending larger than collection. This showed that the economy has a high growth rate, and that the demand for development investment was always high, Jan analyzed.

For his part, UNDP resident representative Jordan Ryan said he strongly supported Vietnam for spending budget money on the poor. He also pledged to help Vietnam in training people-elected officials, enabling them to work independently and effectively. Many foreign experts suggested that Vietnam set up an independent auditing agency, under the National Assembly's Economic and Budgetary Committee, to examine conclusions made by auditing entities. Tao Huu Phung, Deputy Director of the NA Economic and Budgetary Committee pledged to consider this suggestion. Vietnamese officials said a transparent, open, and clearly responsibility-defining financial system is what Vietnam is working for.

From VNA, October 24, 2005

Fitch Raises Korea's Rating

Fitch Ratings Monday raised South Korea's sovereign credit rating by one notch to `A plus' from `A,' citing eased geopolitical risks triggered by North Korea's nuclear standoff. Still, the rating of `A plus' is one notch below `AA minus,' the level given before the financial crisis hit the country in late 1997.It is the same as Taiwan's and one notch above China's. The U.K.-based global credit ratings agency said that North Korea's recent agreement to scrap its nuclear weapons program has eased tensions on the Korean Peninsula and paved the way to upgrading its credit rating. ``South Korea's rating has been constrained by concerns over the threat posed by a nuclear-armed North,'' said James McCormack, head of Asia Sovereigns at Fitch Ratings. ``These concerns have not been alleviated in full, but the risks have diminished with the focus of the six-party negotiations now shifting from whether North Korea would abandon its weapons program to how and when the program will be abandoned,'' he added.

In September, North Korea agreed to scrap all its nuclear weapons and rejoin an international non-proliferation regime in exchange for political and economic benefits at the six-party talks held in Beijing, ending the three-year nuclear deadlock. Fitch pointed out that there may be disputes over implementation of the various commitments, but achieving an agreement in principle at the six-party talks ensures they will remain the forum in which the remaining issues are addressed. It added that the nation's credit ratings are also supported by continued prudent public finance management and the country's strong external position, citing sustainable government surplus and low government's debt ratio.

Earlier in September, Fitch hinted at a rating upgrade by placing the Korea's long-term foreign currency `A' rating on `rating watch positive.' It kept the credit rating at `A' with a stable outlook for three straight years since it last raised the rating to `A' from `BBB plus' in June 2002. ``Other credit appraisers, such as Moody's Investors Service, may also upgrade the nation's sovereign rating if the six-nation talks to be held in November bring about good results,'' said Deputy Finance-Economy Minister Kwon Tae-shin. In July, Standard & Poor's raised Korea's sovereign credit rating by one notch to `A' from `A minus,' setting the ratings outlook at stable. The rating agency cited a stronger banking sector and a flexible monetary stance for the rating upgrade. U.S.-based Moody's has kept Korea's rating at `A3' since March 2002, when the agency raised the ratings by two notches from `Baa2.'

From The Korea Times, October 24, 2005

Experts Praise Nation's Public Finance System

Hanoi - Many factors and initiatives have created an ideal framework for Viet Nam to develop a modern public financial system, said foreign experts at a recent high-level forum on public finance held in Khanh Hoa Province. Perran Penrose, a budget expert from Britain who has been working in Viet Nam for 10 years, described the country's budget estimating system, which is based on input-output balance, as a progressive system that other developing nations should try to replicate. He told the Viet Nam News Agency that by offering budget allocations to the heads of State agencies, the Government is giving agencies more independence and autonomy in spending.

The move was a difficult first step that needed to be taken to advance the country towards modern state management and spending in line with global trend, the British budgetary expert said. Jan Bergqvist, former Director of the Swedish Parliament's Finance Committee, said many countries respect Viet Nam's budget estimating system, which has often seen budget spending larger than collection. This shows that the economy has a high growth rate, and that the demand for development investment remains high, Jan analysed. For his part, UNDP resident representative Jordan Ryan said he strongly supports Viet Nam's effort to fund programmes for the poor. He also pledged to help Viet Nam in training elected officials, enabling them to work independently and effectively.

Some foreign experts suggested that Viet Nam set up an independent auditing agency, under the National Assembly's Economic and Budgetary Committee, to examine conclusions made by auditing entities. Tao Huu Phung, Deputy Director of the NA Economic and Budgetary Committee pledged to consider the suggestion. Vietnamese officials said a transparent, open, and clearly defined financial system is what Viet Nam is working toward.

From Xuan Hoa, October 15, 2005

 

Finance Ministry Sees Public Finance Gap Below 4.8 Percent of GDP

The Czech Finance Ministry said yesterday it expected the country's public finance gap to be lower than the 4.8 percent of GDP previously projected for this year. Government debt should amount to CZK 1,086 billion, or 37.2 percent of GDP, the ministry said on its website. "The state budget performance in particular has been developing favourably," the ministry said. Eurostat, the EU's statistical office, said Czech public finance gap reached CZK 83.5 billion or 3 percent of GDP in 2004. Government debt amounted to CZK 1,012 billion or 36.8 percent of GDP. "The most important factor of the year-on-year increase in the total expected government sector result will be the expected growth in the central government deficit," said the ministry.

From CTK News, October 25, 2005

Bulgarian Prime Minister: Much Money Are Drained Through Public Finance

Much money are being drained through public finance and this field needs serious reform, the Bulgarian Prime Minister Sergey Stanishev said in an interview for BNT. According to the Prime Minister the thesis that Coalition for Bulgaria has rejected its campaign promises is being constantly taken into people's heads. This has nothing to do with reality and the participants in the three-party coalition did not forget their promises, Stanishev said. He added that the Government is now facing new, unpredicted challenges like oil prices and increase of the current account deficit. "We won't be able to keep all of our promises, especially during the first year. But we haven't forgotten all engagements and will do everything possible to realize them within our mandate and, I should say, even exceed what has been promised", Stanishev said.

From Focus News Age, October 21, 2005

Public Accounts: Tremonti, Selling State Property Not Easy

Selling off state-owned property is not an easy thing to do, at least according to Finance Minister Giulio Tremonti. Speaking at a press conference earlier today, Mr Tremonti said that the government was forced to add another 5 billion euro to the budget bill when it realised it had failed to collect the planned amount of money from massive securitization of state-owned property, a move which had been devised by Mr Tremonti's predecessor, Domenico Siniscalco. Asked by reporters whether he was indirectly criticising Mr Siniscalco, Mr Tremonti hastily pointed out that it was not his wish to "evaluate the work of other ministers. I'm just saying the state could make bombastic returns from selling its property. But that requires a complex bureaucratic procedure."

Recalling his early days as Finance Minister in 2001 (well before he was replaced by Mr Siniscalco), Mr Tremonti said that "estimates back then were based on the 2000 budget passed by the centre-left government and suggesting a potential 8,000 billion lira could be made from selling state-owned property. I remember someone in a position of authority telling me that nobody had ever managed to sell state-owned property, particularly if owned by the Defence Ministry. So why did the left insist on selling that property? Clearly, they were just campaigning ahead of the next elections." On the contrary, his government has estimated making 1 billion euro from such sales, Mr Tremonti said. "And it's an approximation by defect, which means public finances are absolutely under control."

From AGI Online, October 28, 2005

Finance Minister Lashes Out at Bay Street Investment Dealer

Finance Minister Ralph Goodale lashed out Thursday at a Bay Street investment dealer's efforts to rally public opposition to Ottawa's controversial review of the booming income trust sector. Mr. Goodale accused Canaccord Capital Corp., of playing "partisan politics" and following the wishes of Opposition Conservatives with its call for Canadians to lobby their MPs to fight Mr. Goodale's plans to reform the sector. The report was first shown to him by Conservative MP John Reynoldse, whose son is a senior employee at the Toronto-based brokerage, Mr. Goodale said outside a regular meeting of the federal cabinet. "Obviously this particular firm has chosen to take a very political, a very partisan approach," Mr. Goodale said. "It was John Reynoldse ... the former interim leader of the Conservative Party, that presented the document to me, while he was informing me ... that it was his son that basically runs the company - which I thought was an interesting partisan comment on his part."

One day earlier, Canaccord - a well-known Bay Street investment dealer - issued a condemnation of Mr. Goodale's review of income trusts, suggesting it threatens billions of dollars in retirement income by potentially destroying the sector. "We question whether the consultation process with the Department of Finance will be balanced or is it just a sham," wrote Canaccord Capital analysts. "Bay Street cannot protect your investments on this issue, as it alone does not carry political weight," adds the report, which includes the names, phone numbers and e-mail addresses of every Member of Parliament. "The intentional or unintentional destruction of the existing trust market does not need to happen." The comments weren't politically motivated but instead designed to warn the Liberal government the review is creating huge uncertainty for global investors, added Chris Rankin, one of the authors of the Canaccord report.

"We don't know what policy their contemplating because they're not being transparent about it ... they have reduced the credibility of Canadian capital markets worldwide." Mr. Reynoldse denied the report was partisan or represented the Conservative party. He simply passed it on to Mr. Goodale because his son Paul Reynoldse hopes to arrange a meeting between Canaccord and the finance minister, Mr. Reynoldse said. Mr. Goodale's allegations are "very unprofessional ... it had nothing to with the Conservative Party," said Mr. Reynoldse. "He should get his head out of the sand, or someplace else." Mr. Goodale touched off a major financial controversy last month when he announced his review of the income trust sector by federal Finance bureaucrats and called for public input by year-end. Things got hotter still several days later when he warned that federal authorities also wouldn't issue any more advance tax rulings on new trusts until the review is complete - effectively freezing the sector. Outrage was swift and frank from Bay Street as several planned trust conversions ground to a halt and existing rules - along with the sector's future - were thrown up in the air.

From Sandra Cordon Canadian Press, October 28, 2005

Flying in the Face of EC Reason?

Speaking on public television over the weekend, Hungary's Finance Minister Janos Veres once again stated that the country would be able to meet conditions for introducing the euro by 2008 and would be able to switch over to the common currency by 2010, as scheduled. Veres said he continues to consider 2008 a realistic date for adopting the euro, while still maintaining support for the budget now before parliament. "This budget includes a large number of development projects for Hungary and also requires managers of organizations supported by public finances to implement streamlined budgets." The minister's statements would seem to fly in the face of the European Commission's estimates; the EC on Thursday, October 20, said that Hungary's 2005 and 2006 budget deficit targets will not be met due to spending on military aircraft, higher social spending and proposed taxation cuts.

These tax cuts, the EC said, run counter to EU recommendations, "which tie the timing of tax cuts to hitting deficit targets. The substantial deviation, both in 2005 and 2006, from the planned adjustment path is worrying and puts into question the credibility of the correction of the excessive deficit by 2008," said European Commissioner for Economic and Monetary Affairs Joaquin Almunia. Hungary has not complied with the recommendations of EU finance ministers to take action to reduce its budget shortfall below the EU ceiling of 3% of GDP by 2008, the EC concluded. Hungary must bring its budget deficit to below 3% in 2008 to adopt the euro two years later. Veres, however, said the public finance deficit could not be cut more than planned without reducing welfare or healthcare expenditures, or withdrawing funding from local governments.

For Hungary to join the euro zone in 2010, both the government and the opposition should undertake major reform steps, Gabor Horn of the junior governing liberal Free Democrats (SzDSz) said after the EC expressed concern over Hungary's ability to meet the Maastricht criteria for euro membership by 2010. European Union regulations allow for convergence subsidies to be suspended if member states fail to observe directives issued in Brussels. However, last week Commissioner Almunia said the EC was not considering such measures.

From Budapest Sun, October 27, 2005

 

Sharp Rise in Initial Public Offerings in Saudi Arabia

Issuance of IPOs (initial public offerings) is becoming a growing trend in Saudi Arabia. Nearly 60 companies in the Kingdom either have gone through or are undergoing the process. In the latest instance, the Middle East Specialised Cables (MESC) is to turn into a joint stock company and has signed an agreement for the purpose with Saudi Hollandi Bank (SHB) and Ernst & Young appointing them as joint financial advisers for the company's IPO of its shares on Tadawul. After being approved by the Capital Markets Authority (CMA) and Ministry of Commerce and Industry, the IPO is expected in the second half of 2006. Some 30 per cent of its shares would be on sale to the public once the IPO goes through. "The IPO will provide MESC with access to the public capital markets and facilitate future fund raising through a second offering to fund its anticipated future growth.

After developing and re-engineering the commercial operations over the past many years, MESC is now ready for a public listing," Abdulaziz Al-Namlah, the majority shareholder, said on behalf of MESC. "Our company has come a long way since its inception, and a public listing will enhance our market position as a leading player in the industry, Al-Namlah added. He said that the cable market in the Kingdom and the GCC was worth an estimated $ 2 billion presenting a huge potential. He said MESC was prepared to face competition following the Kingdom's accession to the World Trade Organisation (WTO). He explained that the company had gone through a five-fold expansion since its inception in 1992, which attested to the quality of its products. The signing ceremony was held at the headquarters of SHB in Riyadh on Tuesday.

Al-Namlah, and Abdulelah Al-Shaikh, general manager of corporate banking group signed the agreement on behalf of MESC and SHB respectively. MESC concluded a similar pact with Ernst & Young represented by its managing partner, Abdulaziz Al-Sowailim. "This agreement reinforces our commitment to provide comprehensive financial advisory services to our clients. It gives us great pleasure to be signing the second pact during this week, which clearly reflects that we are now a significant player in the capital markets arena in Saudi Arabia," Al-Shaikh said after the signing ceremony. "We have a highly competent team comprising local and foreign experts with significant experience in capital market transactions.

We believe we are well-positioned to advise MESC on its IPO, he added. He said MESC could look forward to the future with confidence, since it had gone through five expansions in a market in which it was the dominant player as the manufacturer of specialised cables. Al-Sowailim said the agreement highlighted the advantage their regional presence provides to the clients from its offices in Riyadh, Dubai and Amman to match the regional presence of MESC's operations in support of the IPO. Mark Hanson, head of corporate finance, and Tom Lind, head of structured finance and syndication (both from corporate banking group), said SHB's high level of expertise had enabled the bank in providing comprehensive financial advisory services to their clients.

From Khaleej Times Online, October 28, 2005

 

Turnbull Bypasses Public Bidding to Speed Woodson Mold Cleanup

Charles Turnbull has signed a proclamation to expedite repairs and renovations to Woodson Junior High School a little more than a month after the school was shut down because of a mold infestation. In declaring "a state of public exigency," the V.I. Education Department will be able to purchase supplies, materials, equipment, contractual services and other tools necessary for the cleanup and repair of Woodson classrooms, offices and other areas of the campus impacted by mold, moisture and flooding. According to a statement released by Government House, such purchases can be made "without observing the advertising for public competitive bidding required by statute." Woodson principal Vaughn Hewitt said Wednesday that he was pleased the governor acted as quickly as he did.

"This is good news," Hewitt said. "This will allow the department to move forward quickly and get our students and teachers back in our school." Woodson was shut down on Sept. 13 for mold testing after teachers staged protests, refusing to teach until the school was free of mold and mildew. The department began holding two sessions of classes at Elena Christian Junior High School on Sept. 26 to get Woodson students back into classrooms. Elena students attend one session in the morning, and Woodson students go in the afternoon. Hewitt said engineers are developing a complete scope of work that will be done before Woodson reopens. Hewitt said he did not know when major construction would begin. Calls to Education spokeswoman Juel Anderson were not returned Wednesday.

Before efforts to remove the mold begin, the source of excessive moisture and flooding at Woodson must first be taken care of, Education Commissioner Noreen Michael told senators during a recent public hearing on Woodson's mold problem. A construction company began repairing the school's roof, gutters, pipes and drainage systems last week. According to an assessment and mitigation report on Woodson, some of the projects are estimated to cost more than $700,000 and include installing air conditioning and humidifiers in classrooms, improving ventilation and replacing faulty downspouts and piping. Estimates on projects to improve drainage and reduce flooding were not available.

Last week Turnbull signed off on $5 million for maintenance work on the territory's schools as part of the Omnibus Authorization Act of 2006. At least $1.5 million of those funds must be spent on repairs to Woodson. Officials said an additional $1 million in Public Finance Authority funds already have been earmarked for repairs at Woodson. In a released statement, Turnbull called on the V.I. Public Works, Finance, Justice, Management and Budget departments to assist in the procurement process and provide full support to the initiative. "The education of our children is top priority, and this administration will continue to give it the full attention and importance that it deserves," Turnbull said.

School officials said the mold problem has existed for years but has worsened in the last year. Teachers and students long have complained of itchy throats and breathing problems. According to an indoor air-quality report on Woodson by Environmental Concepts Inc., "very high" concentrations of mold spores were detected throughout the school. In the Virgin Islands, the acceptable level for total mold spore concentration per cubic meter is 300 during the rainy season. Technicians reported that the highest level detected at Woodson was 137,000 per cubic meter.

From Virgin Island Daily News, October 27, 2005

MPs Want Pension Deal Extended to LGPS

Sixty-six MPs have signed a parliamentary motion urging Deputy Prime Minister John Prescott to extend last week's surprise deal on unfunded public sector pensions to local government. The growing support for concessions on employees' retirement plans to be extended to the Local Government Pension Scheme has heaped pressure on Prescott in advance of a critical LGPS meeting. Prescott will chair the government/ employers/trade union tripartite committee on November 2. He will be presented with evidence from Unison of widespread MPs' support for the Public Services Forum deal on pensions to be extended to town halls. Trade and Industry Secretary Alan Johnson last week reached agreement with unions representing millions of health, education and civil service staff that he would not raise the pension age for existing pension scheme members from 60.

In return, the unions involved have provisionally agreed that new members to occupational schemes would have a pension age of 65 from 2006. The LGPS was exempted from the PSF agreement on the grounds that it is a funded scheme that has been subject to a pension age of 65 for new members since the mid-1990s. Unison, the T&G and the GMB are leading the campaign to protect payouts for members who joined the scheme before the switch – a benefit that the Employers' Organisation for local government wants removed on cost grounds. As Public Finance went to press, signatories to an early day motion calling for the PSF deal to be extended included Labour stalwarts Paddy Tipping, Dennis Skinner, Angela Eagle and Diane Abbott. Members of the Commons influential public administration and ODPM select committees, including Gordon Prentice and John Cummings, also backed the motion. Heather Wakefield, Unison's national officer for local government, said: 'There is significant support for the PSF deal at local government level. The Cabinet has backed it, MPs have backed it – we just need John Prescott to see sense now.'

From Publicfinance.co.uk, October 28, 2005

 
 

Public-Private Partnership Strengthens Capacity to Fight HIV/Aids

The Tanzanian government has joined forces with the US-based Abbott Fund to enhance capacity in the health system and "dramatically improve" HIV/AIDS care with a state-of-the-art treatment centre and clinical laboratories costing US $35 million. The new facilities at Muhimbili National Hospital in the capital, Dar es Salaam, will treat up to 1,000 patients a day. According to Abbott Chief Executive Officer Miles White, "By modernising the facilities, improving hospital management and training staff we are fundamentally expanding the country's capacity to provide quality testing and treatment of HIV and other lifelong diseases." Tanzanian President Benjamin William Mkapa noted that the initiative would further the goal of expanding the national treatment programme to reach more Tanzanians living with HIV.

From allafrica.com, October 7, 2005

Nigerian Privatization Agency Concludes 18 Port Cconcessions

Nigeria privatization agency said Tuesday it had concluded 18 out of 25 concessions of the country's ports with gross proceeds of 4.93 billion US dollars. The Bureau of Public Enterprises said in a statement that about 12 million dollars has however been received from concessionaires as entry fees in respect of three terminals at Apapa Port Complex in Lagos, its largest city. "Among those that have paid the mandatory entry fees are ( Danish shipping giant) AP Moeller and the ENL Consortium (of the United States)," it said. "The payments followed the signing of concession agreements by the companies with the federal government. "

The bureau had on March 10 this year opened the financial bids of prospective concessionaires for Apapa Port Complex which includes the Container Terminal and terminals C and D. ENL won the terminals C and D with a bid price of 42.71 million dollars for ten years. AP Moeller beat International Container Services Inc. to emerge the preferred bidder for Apapa Container Terminal with a total lease fee of 3.62 billion dollars over 25 years. Nigerian commenced reform in the port sector in January 2004 aimed at developing of a new legal and regulatory framework and promoting greater private sector participation through the concession of 25 terminals.

From Xinhua, October 26, 2005

Private Sector Must Pool Resources

The Minister of Regional Co-orperation and NEPAD Dr Konadu Apraku has called on the private sector to play an active role in the integration process of the Economic Community of West Africa States (ECOWAS). He, therefore urged businessmen in the sub-region to pool their resources so as to put themselves in a better position to compete globally on the international market. Dr Apraku said this at the inaugural meeting of the West African Pharmaceutical Manufacturers Association (WAPMA) in Accra on the theme "Providing Regional Healthcare Solution". The minister expressed appreciation of the level of co-operation through institutions and regional groups such as the West African Network (WAEN),Federation of West African Chamber of Commerce,African Business Roundtable and Federation of West African Manufacturers Association.

Dr Apraku said the formation of cross-border business associations would develop networks that would enable them to acquire firsthand knowledge about the problems and the needs of their members. "This will place you in much better positions to provide policy makers with valuable information that will help shape government policies and make them more acceptable," he said. He urged the association not to be preoccupied with enforcing its constitution and code of ethics but should be concerned with exploring avenues for undertaking joint investment projects in the drug manufacturing sector for its members to benefit from economies of scale. The Deputy Minister of Health,Dr Mrs Gladys Ashitey, congratulated all stake holders for efforts to realise this vision. Nana Akuamoah Boateng-Saka,a participant, appealed to governments in the sub-region to reduce taxes on medical products to enhance access to other countries within the sub-region.

From Graphic Ghana, October 26, 2005

 

Government Plans Setting Up National Fisheries Development Board

The Government is considering establishing a National Fisheries Development Board to optimally tap the potential for increased production of fish with a special focus on inland aquaculture, Union Minister of Agriculture & Consumer Affairs, Food and Public Distribution Sharad Pawar, announced here today. Delivering the Valedictory address at the two-day International Conference on Public Private Partnership in rainfed Agriculture, Mr Pawar said, ''We are all painfully aware of the many instances of farmers' suicides from different parts of the country'', and added that ''such instances are practically non-existent in those regions where the farmers had an opportunity to earn some income from allied activities like livestock rearing and fisheries.''

The Conference was jointly organised by Federation of Indian Chambers of Commerce and Industry (FICCI), International Food Policy Research Institute (IFPRI) and International Crops Research Institute for Semi-Arid Tropics (ICRISAT). The Agriculture Minister further said, ''We feel that it is possible to reach growth rates of 8-10 per cent in the fisheries sector mainly through inland aquaculture'', and saw a big role for the private sector in seed production, human resource development, post-harvest management and marketing in the fisheries sector. He said rainfed agriculture calls for addressing critical issues such as availability of adequate credit at reasonable rates and expansion of irrigation coverage and adoption of better water management techniques.

''It was equally important to focus on increasing public-private partnerships to harness the potential in horticulture, livestock and fishery - inland as well as marine.'' Mr Pawar said in order to bridge the gap between the demand and supply of horticulture products and achieve sustainability in production it was imperative to put in place adequate marketing infrastructure, suitable policy environment and mechanisms for articulating the technological needs of producers and processors. He also emphasised the need to stimulate private investment particularly in the field of infrastructure, marketing and R&D with particular emphasis on organizing production programmes to cater to the needs of processing industry and exports.

Mr P M Sinha, Chairman FICCI Agriculture & Rural Development Committee, suggested that the Government should announce the wastelands available for acquisition by the private sector with a transparent policy for allocation of wastelands on long-term lease. He called for the development of a well-conceptualised weather insurance covering a wide range of crops to reduce the risk of farmers. The Central Government should create an Agriculture Risk Fund and design a special insurance product and dispensation mechanism, he pointed out.

The Director General of IFPRI, Dr Joachim Von Braun, said India faces the challenge of scaling up from the experiences gained so far with sharp increases in productivity in drought-prone areas especially in watershed management. Dr Ashok Gulati, Director, Markets, Trade & Institutions Division, IFPRI, called for multi-coloured revolution in the country by putting a design experiment in place wherein the Government underwrites risks.

From news.webindia123.com, October 20, 2005

Public-private Partnership May Suffer

NR Narayana Murthy has quit as chairman of Bangalore International Airport Limited (BIAL), dealing a severe blow to potential infrastructure development in India's silicon valley. His move may also adversely impact the process of public-private partnership for which Karnataka has become famous. Murthy, the chairman and chief mentor of Infosys Technologies, quit the post today after HD Deve Gowda, Janata Dal (S) leader and former prime minister, accused him of making little contribution to the Bangalore airport project. Murthy had been appointed head of the BIAL board by former Chief Minister SM Krishna, a Congress leader, in order to get the much-delayed project moving. Deve Gowda is at loggerheads with Krishna and is seeking to question his record when he was the chief minister.

In a hard-hitting letter to Karnataka Chief Minister Dharam Singh, Murthy said, "The media reports of October 17, 2005 refer to your coalition partner Deve Gowda speaking to the press about the lack of my contribution to the Bangalore International Airport Limited during the last five years. I wish he had asked me personally before going to the press, or talked to you or ascertained it from members of the board. I am disappointed that a former prime minister did not accord me this basic courtesy." He went to add, "I am pained, more so, that leaders in the government like you did not even clarify my role in the company and the work that has been done. I have spent enormous amounts of time and energy in interacting with the government in New Delhi and the government here to make this work. The records prove themselves."

Murthy had played a strong facilitating role in getting the airport project to clear the final hurdles and achieve financial closure. The construction work for the prestigious Rs 1,300-crore project has already started. The project is being showcased by the state government as one of its achievements on the infrastructure front. Industry leaders from across the state reacted sharply to the resignation, stating this would have a negative impact on the public-private partnership model. Kiran Mazumdar Shaw, CMD, Biocon, who also plays an active role in the development of Karnataka, said, 'It is a sad development that people like Mr Murthy quit such positions. It will send out wrong signals and other people will be reluctant to take up such initiatives like he had done. The politicisation of the issue of infrastructure should not have happened and efforts should have focused on development.'

She added that the public-private partnership model in the state was healthy and this development would have a negative impact on it. People like Mr Murthy and I have spent an enormous amount of time in building up processes for PPP in the state. Obviously, Mr Murthy is pretty hurt to have taken such a decision. He is a respectable man and it should not have happened.' Anant Koppar, chairman, Bangalore Chamber of Industry and Commerce, said, 'It is an unfortunate event to have happened in the PPP model here. The people's faith that the PPP will enhance the present and future infrastructure and service obligations of the state will be shaken. This will delay the progress of the international airport project.'

His public role - At the height of the controversy surrounding the IIMs last year, Murthy was among a handful of Indian corporate bosses who stood up to the HRD ministry's decision to slash fees at the institutes. Murthy called off the infotech industry's boycott of Asia's premier technology event, the BangaloreIT, in October 2005 after the Karnataka government assured him that infrastructure concerns in the city would be addressed. Murthy has now quit the chairmanship of Bangalore International Airport Ltd after former Prime Minister HD Deve Gowda accused him of lack of contribution to the airport project.


The airport story - May 1999: MoU for the project signed; Aug 1999: Global tenders floated; June 2001: Consortium of Siemens, Unique Zurich and Larsen & Toubro chosen as strategic joint venture partners; Jan 2002: Shareholders agreement executed. June 2004: Cabinet approves the concession agreement; June 2005: Bangalore International Airport Ltd achieves financial closure; Mar 2008: Target opening date of the airport.

From www.business-standard.com, October 21, 2005

Setting Up of Public Private Partnership Appraisal Committee

Cabinet Committee on Economic Affairs(CCEA) today gave its approval for setting up of the Public Private Partnership Appraisal Committee, on the model of Public Investment Board (PIB), with the authority to appraise projects where the capital cost or the cost of underlying assets of the project exceeds Rs.100 crore. Once these projects cleared by the Appraisal Committee, the project would be put up to the Competent Authority for final approval. In case there are departures from the Model Concession Agreement (MCA)which are not material or substantive, such departures will be cleared by the PPPAC with the approval of Finance Minister. Where the departures are material or substantive, approval of the authority that approved the MCA would be necessary.

The Committee would comprise the following: (a) Secretary, Deptt. of Economic Affairs (In Chair); (b) Secretary, Planning Commission; (c) Secretary, Deptt. of Expenditure; (d) Secretary, Deptt. of Legal Affairs; and (e) Secretary of the Department sponsoring a project. The Committee would be serviced by the Department of Economic Affairs, which will set up a special cell for servicing such proposals. The Committee will co-opt experts, as necessary. CCEA also authorized the PPPAC to determine the process of approval of projects as per following:

(i) The Ministry concerned would develop individual proposals using legal, financial and technical consultants and also avail the benefit of an inter-ministerial consultative group, if necessary. The proposal, as formulated by the Ministry, would be considered by the PPP Appraisal Committee for 'in-principle' clearance before inviting expressions of interest from prospective investors. (ii) Following the 'in principle' clearance of the PPPAC, the concerned Ministry will invite expressions of interest and develop the documents further. Where necessary inter-ministerial consultations and pre-bid conferences with bidders will also be held. The concession agreements thus finalized for the purposes of inviting financial bids should be cleared by the PPPAC before technical and financial bids are invited. (iii) In cases where the PPP project is based on a duly approved MCA, 'in principle' clearance by the PPPAC would not be necessary. In such cases, approval of the PPPAC would be obtained only before inviting the technical and financial bids.

For projects where the capital costs or underlying value of the assets is less than Rs.100 crore the Department of Expenditure would issue detailed guidelines for appraisal of concession agreements. Such projects would not require appraisal/approval of the PPPAC and would be cleared by the SFC/EFC as applicable. The PPPAC would be set up within one month and would result in improving the efficiency of such projects.

From Press Information Bureau - Government of India, October 27, 2005

PM for Public Private Partnership in Rehabilitation Work

Prime Minister Shaukat Aziz Monday said the government was committed to speeding up relief and rehabilitation work in the earthquake affected areas through public-private partnership. He was talking to a delegation of DHL and SHV which called on him to discuss the relief and rehabilitation work in the earthquake affected areas. Representatives of the two organizations made some suggestion for improving the logistics for dispatch of relief goods to affected areas as well as to improve facilities to bring efficiency in the reconstruction and rehabilitation activities. Prime Minister Shaukat Aziz said the two agencies.

Federal Relief Commission and Earthquake Rehabilitation Authority were working in close coordination with all related agencies for the relief and rescue work as well as for reconstruction and rebuilding of the affected areas. The Prime Minister appreciated the spirit of volunteerism shown by the people and international community to contribute into the government's efforts in the relief and rescue work. However, he said much more needs to be done and government and the people need to sustain this spirit.

The Prime Minister said the magnitude of problem in the earthquake affected areas has increased manifold due to the particular nature of terrain of earthquake affected areas. He lauded the role of army in providing relief to the affected areas.The Prime Minister appreciated the private sector for effective coordination with various government agencies. The meeting was also attended by the Principal Secretary to the Prime Minister Federal Relief Commission Faisal Ali Khan, Director, DHL, Sadiq N. Khan. Awan, DHL, Pervaiz Akhtar, General Manager Corporate Affairs and Company Secretary, SHV Energy Pakistan (Pvt) Ltd., and Patrick J. Gregory. Chief Executive Officer, SHV Energy Pakistan (Pvt) Ltd.

From Government of Pakistan, October 25, 2005

Partnership Law for Revision

The draft legislation on the Public Private Partnership is expected to be finetuned through a stakeholder consultation prior to Cabinet's consideration. Public Private Partnership is a contractual arrangement under which the private sector agree (with the government or public agency)to finance, construct and operate an infrastructure for an agreed period of time and transfer it to the government or the public agency concerned on expiry of the stipulated period. Key stakeholders include the Ministries of Finance and National Planning; Works and Energy; Attorney General's Office, and the Office of the Prime Minister. Deputy secretary of the Public Enterprises ministry, Lenaitasi Korodrau says the draft legislation was followed through from the PPP Policy Paper that was approved by Cabinet sometime in September.

Mr Korodrau said the draft legislation is expected to go through a stakeholder consultation to ensure that the views, interests and concerns from the relevant stakeholders are taken into account and addressed. He said once the consultation process was completed, the Bill would be taken up for consideration of Cabinet. Provisions in the Bill contain the Governments' authority to undertake the PPP arrangement and basically laying down a statutory framework and procedures for formalising the participation of the private sector in building infrastructure in the country. Others include the institutional mechanism for the identification, categorisation and prioritisation of projects for development of infrastructure under PPP as well as the setting up of a regulatory authority.

The contractual arrangement may be entered into on the basis of BOT (build, operate and transfer) BOO (build, operate and own ) or ROT (rehabilitate, operate and transfer), etc. According to Mr Korodrau, Government has agreed that PPPs were mostly used for financing of the construction and management of large infrastructure projects where large amounts of funds would be required for such projects. He said this arrangement was being pursued with the assistance of the Asian Development Bank (ADB) that is currently providing technical assistance in connection with the Fiji Road Upgrading Project IV.

From Fiji Times, October 25, 2005

Government Needs Clarity on Goals of Financial Reform

Last week, senior officials of the Democratic Progressive Party Cabinet, including Vice Premier Wu Rong-i, held a televised debate with legislators from the pan-blue opposition Kuomintang on the question of the second-phase financial reform now being promoted by the DPP government. Although there was an apparent consensus on the need for the privatization of state-owned or controlled banks, there was no agreement on the issue of whether such privatization efforts could avoid resulting in the control of Taiwan's major financial institutions by big corporations or conglomerates. The debate showed that the Executive Yuan gravely lacks a comprehensive and integrated strategy to realize the second-phase financial reform before the end of 2006 and, no less seriously, lacks appreciation for the fundamental significance of this reform.

We should first of all recall that virtually all of Taiwan's banking system prior to 1992 was controlled by the former ruling Kuomintang party-state, which it consciously used to further its own interests as well as Taiwan's economic development. The banking sector was only partially liberalized in the 1990s and only became relatively free of KMT party control upon the realization of Taiwan's first transfer of political power in May 2000 to the DPP. In the early 1990s, the former KMT government, then under President Lee Teng-hui, allowed the formation of 15 "new private banks," most of which were controlled by local conglomerates or fronts for the KMT. Contrary to the expectations of free market theorists, the operation of the market over the subsequent decade did not led to a reduction of the number of banks nor allow any private banks to develop reasonable scale.

Instead, the saturation of the market and the resulting cutthroat competition, especially for high risk construction loans, low profit margins combined with a depression in the property market, business official collusion, weak regulation and other problems generated the native financial crisis that erupted in October 1998. The result was the near collapse of the financial system and a NT$1 trillion-plus mountain of bad loans and assets which the KMT regime left for the incoming DPP administration. Besides pressuring banks to retire bad loans, the first phase of financial reform promoted by the DPP government in President Chen Shui-bian's first term also featured efforts to promote mergers between financial and non-financial institutions and among financial institutions to curb overbanking.

With the help of the official financial restructuring fund, the government also encouraged sound banks to liquidate failing grassroots financial institutions and even some of the formerly touted new private banks. The effort succeeded in the initial goal of reducing the mountain of bad debt, as shown by the reduction in the average non-performing loan ratio for domestic banks from and creating the precondition for the revival of positive growth in domestic bank loans and investments by late 2003. Moreover, in the process of the first phase financial reform, a total of 14 financial holding companies were established that offered hopes of consolidating the banking sector. Reducing bad debt - However, conditions all too similar to those witnessed in the early 1990s still persist, indicating that the objective of realizing the formation of financial institutions with reasonable scale and able to compete globally simply cannot be achieved by relying solely on market mechanisms.

Given this reality, President Chen announced last October four major goals for a second phase financial reform, including the formation of at least three banks with individual market shares of at least 10 percent, the halving of the number of banks with public stock holdings and the halving of the number of financial holding companies to seven. The current practice of the Ministry of Finance to decide the buyer of public-owned bank shares by the price offered may be favorable to the enhancement of bank market shares, but actually will make it more difficult for other targets to be realized. First, the purpose of the sale of public shareholdings in banks should not simply be to reduce the number of public-share banks, but should also aim to realize simultaneously the even more important goal of reducing the number of financial holding companies.

But once the government has sold off its shares in various public banks, it will lose its bargaining chips to promote mergers among financial holding companies that currently have public share banks. Based on this logic, publicly owned shares should be sold to financial holding companies that are willing to engage in a mutually agreed merger to simultaneously boost individual bank market share and promote the halving of the number of financial holding companies. In addition to obtaining better earnings, it should be recalled that public owned or public share banks have policy responsibilities. Taiwan is a small-scale open economy and has relatively weak capacity to bear the impact of international factors or shocks. To avoid excessive blows to the domestic financial system, the government must maintain a suitably sized public banking system in addition to allowing private banks to enjoy a more open and freer competitive environment in the process of market liberalization. Many countries in Europe feature a coexistence of public and private banks.

Private banks may sacrifice the quality or provision of financial services to peripheral or outlying areas, smaller enterprises or poorer social groups in order to maintain profitability. However, the existence of a certain number of reasonably sized public banks can place priority consideration in their provision of financial services on the promotion of economic and financial reform policies and the welfare of all citizens. Even if the number of publicly-owned and public stock banks can be halved, we strongly advocate that the government must retain a number of public banks. A clear reaffirmation of a commitment to the maintenance of a public bank sector that can respond to the financial needs of small enterprises and ordinary people and safeguard national economic security will help win citizen support for financial reform.

From Taiwan News, October 26, 2005

Federal Government Encourages Public and Private Partnerships

Despite the problems plaguing the New South Wales Government and the private operator of Sydney's Cross City Tunnel, the Federal Government is actively encouraging public and private partnerships – or PPPs as they're known. The New South Wales experience has raised questions about whether PPPs cost taxpayers more than publicly funded projects in the long run. Dr Sharman Stone is the Parliamentary Secretary to the Minister for Finance and Administration and has responsibility for PPP policy. She is meeting state and territory ministers this morning to discuss ways to improve these partnerships. Dr Stone has been speaking to our reporter, Andrew Geoghegan.

SHARMAN STONE: Well a PPP will be the best value for money when you've got a project with particular criteria or characteristics. We have just changed our budget consideration for example to say that if there's a project over some $100 million and long term life, then every one of our government departments or agencies need to have demonstrated that they have thoroughly considered a PPP, and if they haven't taken it up as an option, we want to know in Cabinet exactly why not, because we always want to deliver best value for money for the taxpayer.

ANDREW GEOGHEGAN: Well let's take Sydney as an example where the partnership between the New South Wales Government and a private consortium to build the cross-city tunnel has obviously been a bad deal for the State's taxpayers. Do you concede that PPPs can cost taxpayers dearly in the long run?

SHARMAN STONE: Well of course like any major project, some are more successful than others it would appear in the first instance. But you can't always judge a project in its first weeks or months of operation. Typically, big, large complex projects – say for schools, hospitals, roads and so on - the completion of the project under a PPP has been more timely, more likely to be on budget, and the stakeholders at the end of the day have been very satisfied with the service that's been delivered as a result of the partnership. There's always a risk, and that's one of the skills we need to further develop in the public sector, and in the private sector, how to evaluate the risk up front.

ANDREW GEOGHEGAN: Is that risk really necessary when we consider for instance that a report authored by Professor Bob Walker from the University of Sydney argues that governments are becoming more adverse to using public debt to fund these projects, even though they can service the debt more cheaply?

SHARMAN STONE: Well financing isn't the key driver necessarily of a PPP partnership, especially in a country like ours where there's not a shortage necessarily of public sector finance. What drives a successful PPP is a combination of where the project is completed perhaps in a more timely way, or that's the aim of course, and indeed on budget, but also there's innovation that the private sector can bring.

ANDREW GEOGHEGAN: Do you envisage a day when governments will simply manage and it'll be the private sector that funds, builds and owns all infrastructure?

SHARMAN STONE: Very often when you ask the question, who can do the job best? - it's the commercial sector or the business sector, or if you like the private sector who can do the ownership and facility management of a piece of physical infrastructure more efficiently and better, leaving the Government and the government service sector to deliver the services. And that's what we're trying to do.

From abc.net, October 28, 2005

Carr Ddefends Private Sector Jobs

Former NSW premier Bob Carr says his previous job should not prevent him from working in related roles in the private sector. Since leaving public office in August, Mr Carr has become a highly paid consultant for Macquarie Bank, which played an instrumental role in a host of major NSW infrastructure projects including the controversial Cross City Tunnel. He also has an unpaid position as chairman of the advisory council of the new Climate Institute, which will lobby governments to take drastic action to address climate change. Mr Carr fended off questions today from reporters about whether his role as an environmental lobbyist put him at odds with his consultancy job for Macquarie Bank and some of the decisions made when he was premier.

Asked whether his work for Macquarie Bank and the Climate Institute represented a conflict of interest, Mr Carr said: "You could say that about ... almost everything I do, as a former premier.""You could say what I'm doing today involves a conflict of interest," he said. "I'm using the knowledge I've got, I've acquired as premier, any influence I've got as premier, to push a particular policy outcome. "You can say that about anything a former politician does, but I reject the notion that I alone of former politicians (am) going to be subject to some sort of artificial restraint." Mr Carr defended his environmental record during his 10-year reign as premier, during which his Government built numerous motorways. The Climate Institute, to be headed by prominent academic and researcher Clive Hamilton, was established through a $10 million donation from the Poola Charitable Foundation.

From Daily Telegraph, October 27, 2005

Bush Announces Private-sector Campaign for Quake Aid

US President George W Bush said on Thursday that executives from some of the world's best-known firms would spearhead efforts to raise private-sector aid for victims of the massive earthquake in Pakistan. "In the coming days, they will ask Americans to donate directly to a fund set up to provide help to the earthquake victims," Bush said in a statement released by the White House. The October 8 quake sent a 7.6-magnitude shockwave through South Asia, killing at least 54,000 people in Pakistan and 1,300 in India, as well as leaving more than three million without roofs over their heads.

The executives leading the aid drive were Jeff Immelt, chairman and chief executive of General Electric; Hank McKinnell, chairman and CEO of Pfizer; Sandy Weill, chairman of Citigroup; Anne Mulcahy, chairman and CEO of Xerox; and Jim Kelly, former chairman and CEO of the United Parcel Service of America, Bush said. "These leaders will work with other Americans to raise awareness and resources to help those in need as a result of this disaster," Bush said.

From Daily Times, October 28, 2005

Sri Lanka Government Shelves Private Sector Funded Oil Refinery Project

Sri Lanka government shelves private sector funded oil refinery project in Sapugaskanda under trade union pressure. Last week, Cabinet gave the green light for a US$ 800 million oil refinery project financed by US company Global Energy Industrial Operations. Global Energy was to build the new refinery in the State owned Ceylon Petroleum Corporation (CPC) land, operate it for 30 years and hand it over to the CPC. The new facility was expected to treble Sri Lanka's oil refining capacity brining it up to six million tonnes per year. But plans are now "differed" until "further study," Cabinet spokesman Nimal Siripala de Silva told journalists on Thursday, after trade unions threatened to strike, if the deal went ahead.

"The Prime Minister and the Minister of Power and Energy have both requested time to further study the matter and this has now been differed," said de Silva. Last week CPC trade unions threatened to strike unless the project was stopped. Trade unions also met Prime Minister Mahinda Rajapaksa on Monday and extracted a promise that the deal will come under closer scrutiny before it gets government approval. Unions say they are not fully informed about the legalities of the agreement and are now waiting for an explanation of the nuts-and-bolts of the deal.

From Lanka Business Online, October 27, 2005

 

Official Says Public-Private Partnership Act Is Crucial

An official of the National Audit Commission has stressed that Slovenia must pass an umbrella act on public-private partnership because the companies act does not state how the state should find a private partner. "Because certain cases are not dealt with in existing laws, we need an umbrella act to determine which act should be applied in which case. This will not be solved simply by changing certain regulations," Aleksij Muzina told a conference on efficiency in the public sector on Thursday, 6 October. Deputy head of the Court of Audits Tomaz Vesel agreed that public-private partnership was not yet clearly defined. However, it can be seen as a relationship between private businesses and public entities in infrastructure projects and services, where the private partner must take on the business risk.

This manner of financing could be used in Slovenian infrastructure projects and services despite the unsuitable normative framework. The act should determine that a preliminary assessment must be made to establish whether it is reasonable to finance a certain project in public-private partnership. Luka Vesnaver of the Nova Ljubljanska banka (NLB) said this type of partnership could extend financing, which provides an additional opportunity for private businesses and lower prices along with better quality for target users. Slovenia is lagging behind other EU member states in public-private partnership and is one of the rare countries that lacks a normative framework definition, he told the conference, held in Ljubljana.

From Slovene Press Agency STA, October 19, 2005

France Gives Up Privatization of Nuclear Company Areva

France Thursday said it will not carry out the controversial partial privatization of energy group Areva, the world's biggest builder of nuclear power reactors. Prime Minister Dominique de Villepin said at his monthly news conference that "Regarding Areva, the opening up to private capital is not one of the projects of my government." Finance Minister Thierry Breton earlier indicated Areva would be partially privatized and started its initial public offering in 2006. Villepin said, "In a sector as strategic as the provision of fission materials, the enrichment and treatment of nuclear waste, state control must provide the necessary guarantees to our citizens as well as to our foreign clients."

He also played down talk of privatizing the state-owned railway company SNCF and the post office, saying both "were not the order of the day." But Villepin gave green light to the privatization of the airport operator Aeroports de Paris (ADP), saying he would give his agreement at the right time. "In a more and more competitive environment, Aeroports de Paris must modernize its infrastructure and create the most modern and secure airline terminals." Privatization of the big public services is a highly sensitive political issue in France.

From Xinhua News Agency, October 28, 2005

All 7 CEC Bidders Enter Second Phase of Privatization

The Savings Bank CEC privatization commission analyzed the conclusions of the 7 preliminary offers and decided that all bids submitted, will participate in the second stage of the privatization process, stated the Ministry of Public Finances. The prices haven't been made public due to confidentiality reasons. The seven bidders are: The Monte dei Paschi di Siena SpA Bank, Dexia Bank, EFG Eurobank, Erste Bank, National Bank of Greece, OTP Bank, Raiffeisen Zentralbank Oesterreich Aktiengesellschaft with Raiffeisen International Bank - Holding AG. The French bank Societe Generale was the only bidder that withdrew from the race, after the submitting of the letters of intent. According to sources close to the matter, the price will represent 70 to 90 percent of the score.

The international financing institutions interested in remaining in the race for the acquisition of the majority stake of the National Savings Bank (CEC), must file the final binding offers by November 28. The privatisation commission decided that all seven banks which filed the preliminary non-binding offers meet the conditions for participating in the second stage of the sale process. The banks to continue the race for taking over the 50 plus one stake or 75 per cent of CEC's stake are the Bank Monte dei Paschi di Siena S.p.A.; EFG Eurobank; the National Bank of Greece; OTP Bank, Raiffeisen Zentralbank Oesterreich Aktiengesellschaft in consortium with Raiffeisen International Bank - Holding A.G; Dexia and Erste Bank.

The non-binding preliminary offers which have been filed show that the bidders accepted the clauses of the privatisation contract and that there is the willingness of paying a unitary value per share, higher than the stake put up for sale. Sources close to the transaction claimed the price will represent 70-90% from the score for choosing the investors. If the difference of points between the first and the second placed institution is smaller than 10%, the privatisation commission will ask the two bidders to improve their offers. CEC is the sixth Romanian bank according to the value of its assets and owns the largest territorial network, of approximately 1,400 units.

From reporter.gr, October 26, 2005

Krivorozhstal's Privatization Will Aid Ukraine's Reforms

The funds received from Krivorozhstal's privatization will be spent on national development programs that will ensure quality reforms of Ukraine's economy and social sphere, the country's President Viktor Yushchenko said. In particular, a range of projects on modernization the housing and communal sector, development of high technologies and support of Ukrainian science will be launched in 2005 and 2006, the President's press service told RBC. Commenting on the auction in general, the head of state declared that Ukraine had proven that "the political will is capable of creating a new reality where the interests of bushiness and investors harmonize with the interests of the public." As reported earlier, the tender for 93.02 percent of shares in Krivorozhstal, Ukraine's largest iron and steel works, took place on October 24, 2005. Mittal Steel Germany GmbH won the tender having offered $4.8bn for the stake.

From RBC, October 26, 2005

Government Encourages Private Sector Investments in Innovation Projects

The government hopes its new proposed legislation will encourage private businessmen to invest more in innovative technologies. Today, the cabinet approved a draft law on "State Assistance to Innovative Activities" which officials say is "the first step towards establishing a science-intense economy in the republic". Deputy Minister of Trade and Economic Development Gagik Vartanian, like many other experts, believes that there is no alternative to engaging intellectual capacities in Armenia, a landlocked country deprived of oil and other major energy resources and situated in a geopolitically hostile environment. "This law can in some way contribute that economic interest is created, incentives for private sector to make investments," Vartanian said in a press briefing on Thursday.

According to him, with this new legislation the state promises direct and indirect privileges to businessmen making investments in high-risk technological initiatives. So far Armenia's private entrepreneurs have been reluctant to invest in high-risk projects not only because of large expenses, but also because of the long term of expected profit. Now officials assure that the government will make the first steps in this direction, taking into consideration the presence of certain possibilities. "You saw the high rates of economic growth in recent years. There is a certain possibility to direct some resources also into this sphere. It is the experience of the world and we will apply it, of course, proceeding from our peculiarities. We simply have no alternative," said Vartanian.

Another obstacle standing in the way of the development of innovation projects is the lack of adequate protection of intellectual property rights. For this purpose the government today also approved changes in the Law on "Copyright and Associated Rights", toughening punishments for piracy. Giving explanations in this regard, Intellectual Property Rights Agency Director Armen Azizian said that unlike the current legislation envisaging criminal responsibility for breaking copyrights laws that results in a damage of 500,000 dram (about $1,100) and more, the planned changes will reduce the size of damage to 200,000 drams. "This toughening is aimed at intensifying the struggle against piracy in our country," Azizian explained.

From Armania Liberty, October 27, 2005

 

Growth of Private Sector Top Priority

Fuelling growth amongst small and medium-sized enterprises (SMEs) is central to the election manifesto of a new bloc. The 18-strong Economy and Development Group (EDG) is contesting the Bahrain Chamber of Commerce and Industry (BCCI) elections, with private sector growth as its main platform. To further develop the national economy in Bahrain, its various sectors must be healthy, says bloc member Dr Tawfeeq Almoayed. "The economy functions properly if its components are functioning in the right direction," he said. "The marketing of a product or depends on wholesale and retail trading. "The large firms which import huge amounts of goods need the small firms for distribution on a smaller scale. "The turnover of marketing by retail benefits the wholesalers.

"This mechanism is an example of how the economy works and that is how economic growth gets affected. "We, the Economy and Development Group, are aware of the inter-relationships that hold the economy together. "Our expertise qualifies us to achieve all our objectives and we hope that the BCCI members will support us to accomplish them." MP and current BCCI board member Jehad Bukamal said hopes to help the private sector improve its productivity. "Eighty per cent of the GNP (Gross National Product) is controlled by the government, while only 20pc is controlled by the private sector," he said. "We need to reverse these positions and, in order to do so, the private sector must take a proactive initiative."

Jehad Bukamal's views extend to the political arena too. He believes that the private sector does not play a sufficient political role. "Businessmen should not shy away from politics," he said. Jawad Al Hawaj believes that both clients' and customers' trust play a vital role in the success of any business. "All members of the group put a great deal of emphasis on building trust through strong administrative skills, extensive capabilities and a long term vision," he said. "We hope that, by evaluating this important aspect of our group, businessmen will support us in leading the BCCI in the next term."

BCCI board member Hassan Ebrahim Kamal believes in supporting small and medium-sized firms, which make up approximately 80pc of the private sector. "No one can deny the vital role small and medium-sized enterprises play and we will push for their support and assistance to form a link between SMEs, the chamber and the government, a consolidated trio to further strengthen this field," he said. Nominations are still open for the elections, which are set for November 16.

From Gulf Daily News, October 24, 2005

Minister Urges Private Sector to Cash in on Country's Booming Economy

Encouraging the private sector to cash in on Qatar's booming economy, Minister of Economy and Commerce HE Sheikh Mohamed bin Ahmed bin Jassim al-Thani has said the Government has set the goals of improving physical, social and governmental infrastructure.
"The state rejects monopoly and encourages fair competition and the private sector should take its position in the wake of development," Sheikh Mohamed said addressing business leaders here recently. Highlighting that there are three strategic goals like building physical, social and governmental infrastructure to build strong economy, he said, adding "these goals are moving in the right direction and reflected positively in the economy." A study undertaken by global management consulting firm Bain Company on 'How to stimulate the growth of the private sector in Qatar' also came up for review at the discussions with the Minister. The Bain study found out that between 1998 and 2003 when the oil and gas sectors had clocked a compounded annual growth of 26.6%, the other sectors had a flat growth of 3.2%

Based on a survey on the private sector, it found out efficiency in government services and the availability of human resources are critical to the success of companies. Finding short and long term challenges for Qatar's private sector, which is still emerging, the study said "the growth challenge is not as much about quantity as it is about quality and sustainability." The short-term challenge is to seize opportunities from the current economic boom in trade and infrastructure and at the same time avoiding risk of overheating, speculation and over built up of capacity, it said. The long term challenges are developing sustainable and profitable activities in sector that will durably support the economy, adapting to external competition in the traditional sectors and finding alternative sources of income. It said the requirements for sustainable quality growth are building scale, increasing capabilities and productivity, raising the ability to compete at regional level and reducing reliance on the Government.

Government should spelt out three initiatives – formalise long-term economic development priorities, re-engineer the business environment and define a vision for the sector and role of the state. The Ministries of Energy and Industry and Economy and Commerce should prepare a 10-year strategic development plan for the clusters and identify development opportunities for the private sector, the study said. Regarding re-engineering the business environment, it called for efficient system for regulation, promotion, control and enforcement and said "there is a need to re-engineer the legal and regulatory framework and align it with the requirements of the global economy." It is also imperative to build a marketing strategy and co-ordinate key investment promotion activities for non-oil and gas sectors, the study said.

In the short-term, the study recommended creation of credit bureau and review of credit risk management parameters of bank loan and transformation of the Qatar Industrial Develop-ment Bank into private sector development fund. It also recommended transformation of the New Doha Industrial Area into an Industrial Park to promote specialised industrial areas and said the country should adopt needs-based management of Visas and promote employment of Qataris in private sector. Observing that the domestic economy is experiencing strong growth, accompanied by "internal and external challenges", the study said the Government and the private sector should work hand-in-hand to overcome these challenges.

From Gulf Times, October 22, 2005

Private Sector Steps into Iran's Renewable Energy

More than 10 domestic private companies have taken the lead to invest in new and renewable energies, acting director of Energy Ministry Hamid Chitchian said, according to MNA. The activities in this field in Iran are focused on scientific and research aspects, and research part is aimed at reduction of capital required for exploitation of related resources, he added. The second step is to work research results into scientific dimension of this field for practical means, i.e. establishing electricity power plants. Due to recent advancements in wind energy, many investors in the country have become interested in investing in this type of energy. At the moment, projects assuming 130 MW of wind power plants are underway, of which, 25 MW is operational, the director stated.

Based on the planning in the 4th Socioeconomic and Cultural Development Plan (2005-2010), private sector is expected to have a share of at least 270 MW in renewable energies. However, it is the government?s duty to take the first step for investment in biomass and solar power plants; private sector may then play its part once the infrastructures to this end are laid out, Chitchian continued. At the moment, a 250-KW plant is under construction in Shiraz and two more geothermal units with 5 and 50 MW capacities will follow. Moreover, two biomass and solar energy plants, standing at 10 MW and 17 MW respectively, are of other upcoming projects.

From Iran Mania, October 26, 2005

 

Providence Won't Rule Out a Public-private Deal

Providence Health Care, the Vancouver Coastal Health Authority, and Partnerships BC, a provincially owned company, are preparing a "business case" for the replacement of St. Paul's Hospital. Providence spokesperson Shaf Hussain told the Georgia Straight that the project will cost hundreds of millions of dollars. "The two main options are the redevelopment of the current Burrard site or a brand-new hospital, research, and academic facility at the Station Street site," Hussain said. Hussain didn't rule out a public-private partnership, in which a private-sector company would bid to design, build, and operate the facility under a long-term contract. The B.C. government chose this option for the new $1.4-billion Abbotsford Hospital and Cancer Centre. Aaron Jasper, chair of the Save St. Paul's Coalition, told the Straight that Providence officials have told his group they won't reveal the "business case" before it is sent to the provincial government. "They won't let us see the plan in any detail, or the finances," Jasper said.

Meanwhile, a British researcher who studies P3 projects has warned that public-private partnerships cost taxpayers much more money in the long run. Allyson Pollock, a public-health professor at University College London, has published several papers in the British Medical Journal on P3 hospitals in the U.K. She told the Straight that whenever a private partner operates a public hospital, money that would normally go to clinical services gets diverted into the pockets of bankers and shareholders. "The public should be seeing what are the rates of returns for investors," Pollock said. "What about the equity stakes? What are the rates of return for the venture capitalists? And what are the predictions for the refinancing windfalls? The problem is a lot of these data are not in the public domain."

For these projects, Pollock noted, the private partner borrows money to cover construction costs. It recovers its investment and posts a profit by collecting annual service payments from the public authority. Her research has suggested that under this approach, governments pay much more - sometimes up to 40 percent more over the life of the contract - than they would by borrowing the money themselves and keeping the hospital in the public sector. "The government uses a lot of technical and arcane language to disguise the way it is attempting to dupe the public," Pollock claimed. She added that this is done by inventing a "discount rate", which she described as "a piece of economic sorcery". This rate, set at the outset, estimates the potential savings by having a private company involved in the deal. She claimed that it hides the true cost of privately financed hospitals.

"If the public really want to know, they won't be fooled by discount rates," Pollock said. "They'll use cash costs." In the past, the British government arbitrarily decided that a private operator's involvement automatically reduced costs by six percent. Pollock said that this has since been reduced to 2.5 percent. Federal NDP Leader Jack Layton has suggested that his party might trigger an election if the federal Liberals don't stop the privatization of health care. Former MP Svend Robinson, who is seeking the federal NDP nomination in Vancouver-Centre, told the Straight that he will make this an issue if he wins his party's nod and runs against Liberal MP Hedy Fry in the next election. "We've seen a significant increase in privatization while the federal Liberals shovel more money to the provinces without any strings attached whatsoever," Robinson said. "There is no place for profit maximization in the delivery of hospital health care."

From Charlie Smith (straight.com), October 27, 2005

Private Sector Paying Off Foreign Debt

Private sector companies are reported to have paid off a little under 10 percent of the total they owe to foreign creditors. The companies are reported to have repaid around $900 million out of a total of $9.53 billion owed to their creditors, and have apparently set a target of total repayments this year of $1.5 billion. This would pave the way for lower rates of debt amortization in coming years. The idea is that repayments would average between $500 million and $600 million a year between 2006 and 2017. The estimate for repayments this year so far came from the Foreign Exchange Administration Commission, Cadivi, whose chief, Mary Espinoza Robles, acknowledged that companies were pressing for authorization so that they could make payments on a monthly, quarterly or six-monthly basis.

Cadivi is seen to have visibly eased the foreign exchange controls that were imposed to impede capital flight as an opposition-led two-month national strike against President Hugo Chavez fizzled out in early February 2003. Business leaders, who ideally would like to see the system ended altogether, appear to have accepted that this is highly unlikely in the near future. The government has repeatedly stated that it has no intention of returning to a free market in currency dealings in the foreseeable future. Espinoza Robles said Cadivi had cleared access to 70 percent of the dollars needed to pay for imports - some $14 billion in all, although she was not reported to have indicated the timespan over which this took place. The daily rate of authorizations was now running at $81 million, Espinoza Robles said. That compared with around $50 million a couple of months ago.

From Daily Journal, October 18, 2005